Agrarian Reform Notes
opportunities has reduced the economy’s capacity
Module 1
Agrarian Reform and Democracy: Lessons from
the Philippine Experience; Leonardo A. Lanzona
Jr.
The debate on agrarian reform originally revolves
around two main themes; tenure reform and
categorizing different types of agrarian and land
reforms according to their wider political and
economic intents.
The Agrarian Reform Program has been justified
for two main reasons.
First, to introduce greater efficiency in agricultural
production in terms of land size. This is based on
the notion that smaller-sized farms are more
productive than larger-sized farms.
However, efficiency due to agrarian reform may
have failed to take into account several key factors
than can affect the contracts such as: supervision
costs, technological innovations, organizational
arrangements, land quality, and production risks.
Second, is to see it as a redistributive policy. It is
empirically shown that land redistribution can
benefit the farmers by removing the
intermediaries, such as landlords and lenders, and
increasing their claims on the returns of the land.
However, any form of redistribution should be
accompanied by a set of laws and implementing
modes of governance to restore efficiency once the
socially acceptable distribution has been
determined.
In this scheme, two key factors are important: The
reduction of transaction costs (administrative costs
of implementing the program) and the presence of
credible commitments (development of contract-
enforcing and coercion-constraining institutions).
Increasing agrarian distress for farmers with small
and marginal-sized holdings has caused declining
returns and rising costs, and the resultant reduced
surpluses.
Lack of alternative renumerative employment
to generate sustainable livelihoods.
The current pattern of highly specialized
agriculture has also generated a high degree of
environmental stress through the use of high levels
of chemical fertilizers, pesticides, and groundwater
resources.
With the current systems of regulations and
controls, the elite has found new ways of
maintaining their control. Unless the government
can establish the institutions that can minimize
these transaction costs, the farmers may engage in
various formal or informal arrangements with
other farmers that may be inefficient.
As far as the provisions of the law are concerned,
the political rights of the farmers, as opposed to
the landowner, were protected and even expanded.
In the same way, the policies on the payment of
beneficiaries and support services have been made
to bias the interest of farmers.
Second, despite the enormous power given by the
law to the farmers, there seems to be greater
leeway given to the landowners offered by the
institutions in terms of area cover and complianc.
Although Marcos created an elite-dominated
structure during his dictatorship, Cory Aquino
gave little attention to the necessary institutions
and laws. She made no effort to institutionalize
democracy and seemed not to understand the
consequences of the control of political patrons.
She seemed content in simply restoring the pre-
1972 political system. And in the process, the elite
was able to capture the institutions and resources
that implemented agrarian reform.
To accomplish the transition towards greater
democracy, there must be conditions acceptable to
the elite yet simultaneously place elites in a
situation where it is in their interest to move
towards more impersonal intra-elite arrangements
or work towards greater competition rather than
being more collusive. The second obstacle is
translating and expanding these intra-elite
impersonal arrangements into a larger share of
society. Thus, it is necessary to first secure the
rights of the elites.
Calalang vs Williams
Facts:
The National Traffic Commission recommended
that animal-drawn vehicles be prohibited from
passing along certain traffic and national roads, to
which the Director of Public Works adopted the
measure proposed.
Petitioner, Maximo Calalang, contended that
Commonwealth Act No. 548 by which the
Director of Public Works is authorized to
promulgate rules for the regulation and control of
the use of traffic and national roads and streets is
unconstitutional because it constitutes an undue
delegation of legislative power.
Ruling:
This contention is untenable.
There is a distinction between the delegation of
power to make the law, which necessarily involves
a discretion as to what it shall be, and conferring
an authority or discretion as to its execution, to be
exercised under and in pursuance of the law.
The Legislature may make decisions of executive
departments or subordinate officials thereof, to
whom it has committed the execution of certain
acts, final on questions of fact. (U.S. vs. Kinkead,
248 Fed., 141.) The growing tendency in the
decisions is to give prominence to the 'necessity' of
the case."
CW No 548 does not confer legislative power
upon the Director of Public Works and the
Secretary of Public Works and Communications.
The authority therein conferred upon them and
under which they promulgated the rules and
regulations now complained of is not to determine
what public policy demands but merely to carry
out the legislative policy laid down by the
National Assembly in the said Act.
Said Act, by virtue of which the rules and
regulations complained of were promulgated, aims
to promote safe transit upon and avoid
obstructions on national roads, in the interest and
convenience of the public. In enacting said law,
therefore, the National Assembly was prompted by
considerations of public convenience and welfare.
It was inspired by a desire to relieve congestion of
traffic. which is, to say the least, a menace to
public safety. Public welfare, then, lies at the
bottom of the enactment of said law, and the state
in order to promote the general welfare may
interfere with personal liberty, with property, and
with business and occupations. Persons and
property may be subjected to all kinds of restraints
and burdens, in order to secure the general
comfort, health, and prosperity of the state (U.S.
vs. Gomez Jesus, 31 Phil., 218).
Social justice is "neither communism, nor
despotism, nor atomism, nor anarchy," but the
humanization of laws and the equalization of
social and economic forces by the State so that
justice in its rational and objectively secular
conception may at least be approximated. Social
justice means the promotion of the welfare of all
the people, the adoption by the Government of
measures calculated to insure economic stability of
all the competent elements of society, through the
maintenance of a proper economic and social
equilibrium in the interrelations of the members of
the community, constitutionally, through the
adoption of measures legally justifiable, or extra-
constitutionally, through the exercise of powers
underlying the existence of all governments on the
time-honored principle of salus populi est suprema
lex.
Philippine Sugar Estates Development Co vs
Prudencio
Facts:
Prudencio was a tenant of a certain house to which
plaintiff, Sugar Estates, gave a notice in writing,
terminated her lease, and asked her to vacate the
premises.
Prudencio did not vacate the house within the time
granted by Sugar Estates, and an ejection suit
commenced and was granted by the lower courts.
Prudencio advances the theory that, as a matter of
public policy, courts of justice should abstain from
enforcing the law when the landlords are not in
need of their buildings “for their own dwellings.”
Ruling:
The magic words of social justice are not a
shibboleth which courts may readily avail as a
shield shirking their responsibility in the
appreciation of law.
Before the original complaint was filed, appellant
was arrogant enough to refuse the request of the
plaintiff’s manager to allow a war victim to
occupy the spare room in her house.
Prudencio clamors for social justice, not the one in
the mind of the authors of our Constitution – all
embracing, inspired by the Spirit of Christian
charity, based on the principles of universal
brotherhood, intended to insure the well-being and
economic security of all people – but narrow-
minded, one sided, egoistic, stone-deaf to the cries
of human sufferings, absolutely blind to the
miserable situation of others.
TEDDY CASTRO AND LAURO SEBASTIAN,
petitioners, vs. PABLITO V. MENDOZA, SR.,
on his behalf and as attorney-in-fact of
RICARDO C. SANTOS, ARLENE C.
MENDOZA, MARGIE AC DE LEON, NANCY
S. REYES, MARITA PAGLINAWAN,
NATIVIDAD C. MUNDA, MARILOU DE
GUZMAN RAMOS, LEONCIA PRINCIPIO,
CECILIA DINIO, ANGEL DELA CRUZ,
ZENAIDA SANTOS, LOURDES S. LUZ,
MARIFE F. CRUZ, ANTONIO H. SANTOS,
CONSTANCIA SANTOS, MARCELINA SP.
DAMEG, PLACIDO DE LEON, LILIAN
SANTOS, (collectively organized as Bustos
Public Market II Vendors and Stall Owners
Association) and MUNICIPALITY OF
BUSTOS, BULACAN, respondents, GR No
212778, April 26, 2017
Facts:
The property is part of a parcel of land originally
covered by Transfer Certificate of Title (TCT) No.
T-20427 registered in the name of Simeon Santos,
married to Laura Cruz. Upon the death of Simeon,
his compulsory heirs, surviving spouse, Laura, and
his 7 children executed a deed of extrajudicial
partition with waiver of rights and sale.
Petitioners, on the other hand, are the agricultural
tenants of the original Santos property. Petitioner,
Teddy Castro has been in its actual possession,
occupation, and cultivation, personally performing
all aspects of production with the aid of labor from
the co-petitioner, Lauro Sebastian, and paying the
agreed lease rentals.
The controversy started when Jesus Santos (one of
Simeon’s children) sold his share in the original
Santos property to respondent Municipality. All
phases of the sales transaction between Jesus and
respondent Municipality and the subsequent
construction and completion of the public market
(built on the disputed land), were effected without
issue or complain from the petitioners.
After the inauguration of the public market,
however, petitioners filed their complaint for
Maintenance of Peaceful Possession, Redemption,
and Damages against respondent Municipality.
Petitioners argued that they merely exercised their
rights of pre-emption and redemption provided for
under Sections 11 and 12, Republic Act No. 3844.
The Provincial Agrarian Reform Adjudicator
(PARAD) issued orders of redemption and ruled
that: (1) petitioners are the conclusive tenants of
the entire original Santos property; and (2) both
Jesus and respondent Municipality failed to give
notice of sale of the property to the petitioners.
On appeal by respondents, the Department of
Agrarian Reform Adjudication Board (DARAB)
affirmed that petitioners are the bona fide tenants
of the property. However, it merely directed
respondent Municipality to pay disturbance
compensation to petitioners.
This time, petitioners appealed to the CA, and the
court affirmed the uniform rulings of the PARAD
and DARAB that petitioners are tenants of the
property who did not receive notice of its sale by
Jesus. The decision lapsed into finality.
Thereafter, PARAD issued a resolution favoring
petitioners and their claim to the property,
ordering the execution of a Deed of Conveyance in
petitioners’ favor but denying the issuance of a
Writ of Demolition.
Consequently, private respondents filed various
motions for reconsideration but were all denied by
the PARAD. But private respondents remained
persistent and directly sought relief from the CA
and their petition was granted.
The CA declared that private respondents were
lessees of the market stalls and that the PARAD
committed grave abuse of discretion when it failed
to timely exercise their right of redemption.
The main contention among the parties is
possession and occupation of the property in their
various capacities: (i) petitioners, as possessors-
holders of the real right pertaining to the property,
agricultural tenants with a right of redemption; (ii)
respondent Municipality, as actual owner and
lessor of the public market constructed thereon;
and (iii) respondents, as owners of the market
stalls, vendors-lessees in the public market.
Issue:
Whether PARAD acted correctly when it amended
the decretal portion of its Decision and ordered the
redemption and consequent transfer of the
ownership of the property.
Ruling:
We emphasize that the right of
redemption is a different property right
owned and held by petitioners against the
ostensible ownership of respondent
Municipality of the lot sold to it by Jesus,
where the public market stands.
In this case, the recognition of the right of
redemption did not assume with it an
adjudication of ownership over the thing
itself, the property. Petitioner’s ownership
of the property is dependent on a valid
and effective exercise of the right of
redemption. Clearly, in the
implementation of the PARAD’s ruling, it
remained incumbent upon petitioners to
effect a timely and valid redemption,
without which they cannot gain
ownership of the property.
It is apparent however, that despite their
decreed expulsion and dispossession from
the property, private respondents have not
been given their day in court. They were
simply decreed deprived of their market
stalls upon their refusal to pay rentals to
petitioners who, curiously, do not appear
to be in continuous cultivation of the
property. Thus, their intervention even
after finality of judgment, only at the
execution proceedings, should have been
allowed.
We are not unaware that private
respondents, vendor-owner of the market
stalls, merely derived their right to
possess the property from their contract
of lease with respondent Municipality
such that the final and executor judgment
against respondent Municipality is
likewise conclusive upon them.
Considering the nature and devotion to
public use of the property, the
questionable redemption made by
petitioners, the continued existence of the
public market on the property, and the
absence of proof of petitioners’ continued
cultivation of the property, we allow the
intervention filed by respondents even at
the late stage.
We find that the amendment and the subsequent
issuances of the PARAD did not simply clarify an
ambiguity in the dispositive portion of its decision.
It expanded the original ruling, ordering a transfer
of ownership despite petitioners' invalid
redemption of the property.
We are not unaware that the new owner,
respondent Municipality, is bound to respect and
maintain petitioners as tenant of the property
because of the latter's tenancy right attached to the
land regardless of who the owner may be.
Under the law, the existence of an agricultural
leasehold relationship is not terminated by changes
in ownership in case of sale, as in this case, since
the purpose of the law is to strengthen the security
of tenure of tenants. However, petitioners cannot
gain possession and continue tenancy of the
property which is undeniably devoted to public
use.

Our holding that the property has been devoted to

public use and cannot be appropriated and
possessed by petitioners is unavoidable. The
reclassification and public use of the property were
recognized in the PARAD's original ruling in
DARAB Case No. 739-Bulacan '94.

By contrast, petitioners are not registered owners,

but possessors who ought to be in continuous
cultivation and possession of the property.
Nonetheless, as valid tenants-possessors of the
property, petitioners are entitled to disturbance
compensation under Sec 36(1) of RA 3844, as
amended.