LAND BANK OF THE PHILIPPINES, 

Petitioner, v. HON. ELI G. C. NATIVIDAD, Presiding Judge of the Regional

Trial Court, Branch 48, San Fernando, Pampanga, and JOSE R. CAGUIAT represented by Attorneys-in-fact
JOSE T. BARTOLOME and VICTORIO MANGALINDAN, Respondents.

This is a Petition for Review1 dated December 6, 1996 assailing the Decision2 of the Regional Trial Court3 dated July
5, 1996 which ordered the Department of Agrarian Reform (DAR) and petitioner Land Bank of the Philippines
(Land Bank) to pay private respondents the amount of P30.00 per square meter as just compensation for the
State's acquisition of private respondents' properties under the land reform program.

The facts follow.

On May 14, 1993, private respondents filed a petition before the trial court for the determination of just
compensation for their agricultural lands situated in Arayat, Pampanga, which were acquired by the government
pursuant to Presidential Decree No. 27 (PD 27). The petition named as respondents the DAR and Land Bank. With
leave of court, the petition was amended to implead as co-respondents the registered tenants of the land.

After trial, the court rendered the assailed Decision the dispositive portion of which reads:

WHEREFORE, judgment is hereby rendered in favor of petitioners and against respondents, ordering respondents,
particularly, respondents Department of Agrarian Reform and the Land Bank of the Philippines, to pay these lands
owned by petitioners and which are the subject of acquisition by the State under its land reform program, the
amount of THIRTY PESOS (P30.00) per square meter, as the just compensation due for payment for same lands of
petitioners located at San Vicente (or Camba), Arayat, Pampanga.

Respondent Department of Agrarian Reform is also ordered to pay petitioners the amount of FIFTY THOUSAND
PESOS (P50,000.00) as Attorney's Fee, and to pay the cost of suit.

SO ORDERED.4

DAR and Land Bank filed separate motions for reconsideration which were denied by the trial court in
its Order5 dated July 30, 1996 for being pro forma as the same did not contain a notice of hearing. Thus, the
prescriptive period for filing an appeal was not tolled. Land Bank consequently failed to file a timely appeal and the
assailed Decision became final and executory.

Land Bank then filed a Petition for Relief from Order Dated 30 July 1996,6 citing excusable negligence as its ground
for relief. Attached to the petition for relief were two affidavits of merit claiming that the failure to include in the
motion for reconsideration a notice of hearing was due to accident and/or mistake.7 The affidavit of Land Bank's
counsel of record notably states that "he simply scanned and signed the Motion for Reconsideration for Agrarian
Case No. 2005, Regional Trial Court of Pampanga, Branch 48, not knowing, or unmindful that it had no notice of
hearing"8 due to his heavy workload.

The trial court, in its Order9 of November 18, 1996, denied the petition for relief because Land Bank lost a remedy
in law due to its own negligence.

In the instant Petition for Review , Land Bank argues that the failure of its counsel to include a notice of hearing
due to pressure of work constitutes excusable negligence and does not make the motion for reconsideration pro
forma considering its allegedly meritorious defenses. Hence, the denial of its petition for relief from judgment was
erroneous.

According to Land Bank, private respondents should have sought the reconsideration of the DAR's valuation of
their properties. Private respondents thus failed to exhaust administrative remedies when they filed a petition for
the determination of just compensation directly with the trial court. Land Bank also insists that the trial court
erred in declaring that PD 27 and Executive Order No. 228 (EO 228) are mere guidelines in the determination of
just compensation, and in relying on private respondents' evidence of the valuation of the properties at the time of
possession in 1993 and not on Land Bank's evidence of the value thereof as of the time of acquisition in 1972.

Private respondents filed a Comment10 dated February 22, 1997, averring that Land Bank's failure to include a
notice of hearing in its motion for reconsideration due merely to counsel's heavy workload, which resulted in the
motion being declared pro forma, does not constitute excusable negligence, especially in light of the admission of
Land Bank's counsel that he has been a lawyer since 1973 and has "mastered the intricate art and technique of
pleading."

Land Bank filed a Reply11 dated March 12, 1997 insisting that equity considerations demand that it be heard on
substantive issues raised in its motion for reconsideration.

The Court gave due course to the petition and required the parties to submit their respective memoranda.12 Both
parties complied.13

The petition is unmeritorious.

At issue is whether counsel's failure to include a notice of hearing constitutes excusable negligence entitling Land
Bank to a relief from judgment.

Section 1, Rule 38 of the 1997 Rules of Civil Procedure provides:

Sec. 1. Petition for relief from judgment, order, or other proceedings. 'When a judgment or final order is entered, or
any other proceeding is thereafter taken against a party in any court through fraud, accident, mistake, or excusable
negligence, he may file a petition in such court and in the same case praying that the judgment, order or proceeding
be set aside.

As can clearly be gleaned from the foregoing provision, the remedy of relief from judgment can only be resorted to
on grounds of fraud, accident, mistake or excusable negligence. Negligence to be excusable must be one which
ordinary diligence and prudence could not have guarded against.14

Measured against this standard, the reason profferred by Land Bank's counsel, i.e., that his heavy workload
prevented him from ensuring that the motion for reconsideration included a notice of hearing, was by no means
excusable.

Indeed, counsel's admission that "he simply scanned and signed the Motion for Reconsideration for Agrarian Case
No. 2005, Regional Trial Court of Pampanga, Branch 48, not knowing, or unmindful that it had no notice of hearing"
speaks volumes of his arrant negligence, and cannot in any manner be deemed to constitute excusable negligence.

The failure to attach a notice of hearing would have been less odious if committed by a greenhorn but not by a
lawyer who claims to have "mastered the intricate art and technique of pleading."15

Indeed, a motion that does not contain the requisite notice of hearing is nothing but a mere scrap of paper. The
clerk of court does not even have the duty to accept it, much less to bring it to the attention of the presiding
judge.16 The trial court therefore correctly considered the motion for reconsideration pro forma. Thus, it cannot be
faulted for denying Land Bank's motion for reconsideration and petition for relief from judgment.

It should be emphasized at this point that procedural rules are designed to facilitate the adjudication of cases.
Courts and litigants alike are enjoined to abide strictly by the rules. While in certain instances, we allow a
relaxation in the application of the rules, we never intend to forge a weapon for erring litigants to violate the rules
with impunity. The liberal interpretation and application of rules apply only in proper cases of demonstrable merit
and under justifiable causes and circumstances. While it is true that litigation is not a game of technicalities, it is
equally true that every case must be prosecuted in accordance with the prescribed procedure to ensure an orderly
and speedy administration of justice. Party litigants and their counsel are well advised to abide by, rather than
flaunt, procedural rules for these rules illumine the path of the law and rationalize the pursuit of justice.17

Aside from ruling on this procedural issue, the Court shall also resolve the other issues presented by Land Bank,
specifically as regards private respondents' alleged failure to exhaust administrative remedies and the question of
just compensation.

Land Bank avers that private respondents should have sought the reconsideration of the DAR's valuation instead of
filing a petition to fix just compensation with the trial court.

The records reveal that Land Bank's contention is not entirely true. In fact, private respondents did write a
letter18 to the DAR Secretary objecting to the land valuation summary submitted by the Municipal Agrarian Reform
Office and requesting a conference for the purpose of fixing just compensation. The letter, however, was left
unanswered prompting private respondents to file a petition directly with the trial court.

At any rate, in Philippine Veterans Bank v. Court of Appeals,19 we declared that there is nothing contradictory
between the DAR's primary jurisdiction to determine and adjudicate agrarian reform matters and exclusive
original jurisdiction over all matters involving the implementation of agrarian reform, which includes the
determination of questions of just compensation, and the original and exclusive jurisdiction of regional trial courts
over all petitions for the determination of just compensation. The first refers to administrative proceedings, while
the second refers to judicial proceedings.

In accordance with settled principles of administrative law, primary jurisdiction is vested in the DAR to determine
in a preliminary manner the just compensation for the lands taken under the agrarian reform program, but such
determination is subject to challenge before the courts. The resolution of just compensation cases for the taking of
lands under agrarian reform is, after all, essentially a judicial function.20

Thus, the trial did not err in taking cognizance of the case as the determination of just compensation is a function
addressed to the courts of justice.

Land Bank's contention that the property was acquired for purposes of agrarian reform on October 21, 1972, the
time of the effectivity of PD 27, ergo just compensation should be based on the value of the property as of that time
and not at the time of possession in 1993, is likewise erroneous. In Office of the President, Malacañang, Manila v.
Court of Appeals,21 we ruled that the seizure of the landholding did not take place on the date of effectivity of PD 27
but would take effect on the payment of just compensation.

Under the factual circumstances of this case, the agrarian reform process is still incomplete as the just
compensation to be paid private respondents has yet to be settled. Considering the passage of Republic Act No.
6657 (RA 6657)22 before the completion of this process, the just compensation should be determined and the
process concluded under the said law. Indeed, RA 6657 is the applicable law, with PD 27 and EO 228 having only
suppletory effect, conformably with our ruling in Paris v. Alfeche.23

Section 17 of RA 6657 which is particularly relevant, providing as it does the guideposts for the determination of
just compensation, reads as follows:

Sec. 17. Determination of Just Compensation. 'In determining just compensation, the cost of acquisition of the land,
the current value of like properties, its nature, actual use and income, the sworn valuation by the owner, the tax
declarations, and the assessment made by government assessors shall be considered. The social and economic
benefits contributed by the farmers and the farm-workers and by the Government to the property as well as the
non-payment of taxes or loans secured from any government financing institution on the said land shall be
considered as additional factors to determine its valuation.
It would certainly be inequitable to determine just compensation based on the guideline provided by PD 27 and EO
228 considering the DAR's failure to determine the just compensation for a considerable length of time. That just
compensation should be determined in accordance with RA 6657, and not PD 27 or EO 228, is especially
imperative considering that just compensation should be the full and fair equivalent of the property taken from its
owner by the expropriator, the equivalent being real, substantial, full and ample.24

In this case, the trial court arrived at the just compensation due private respondents for their property, taking into
account its nature as irrigated land, location along the highway, market value, assessor's value and the volume and
value of its produce. This Court is convinced that the trial court correctly determined the amount of just
compensation due private respondents in accordance with, and guided by, RA 6657 and existing jurisprudence.

WHEREFORE, the petition is DENIED. Costs against petitioner.

SO ORDERED.

LAND BANK vs. NATIVIDAD

FACTS:

 Private respondents Caguiat and Mangalindan filed a petition for the determination of just compensation for
their agricultural lands in Arayat, Pampanga. It was taken by the gov’t pursuant to PD 27.
 The RTC ordered DAR and Land Bank to pay petitioners Php 30/sqm. DAR and Land Bank filed MR but it was
denied for being pro forma, not containing a notice of hearing. The decision eventually became final and
executory.
 Land Bank filed Petition for Relief citing excusable negligence as its ground. It alleges that its counsel failed to
include the notice due to pressure of work and he simply scanned the MR. It must still be heard on the
substantive issues raised.

ISSUES:

 W/N failure to include a notice of hearing constitutes excusable negligence entitling Land Bank to a relief from
judgment- NO.
 W/N court has jurisdiction over petition for determination of just compensation- YES.

HELD:

 That his heavy workload prevented him from ensuring the MR included a notice of hearing is not an excuse.
Every case must be prosecuted in accordance with prescribed procedure to ensure an orderly and speedy
administration of justice.
 Respondents wrote a letter to DAR Secretary objecting to the land valuation summary and requested a
conference for the fixing of just compensation. It was unanswered. So, private respondents filed a petition with
court.
 Nothing contradictory between DAR and RTC jurisdiction. DAR has primary jurisdiction to determine agrarian
reform matters (administrative proceedings) while RTC has original and exclusive jurisdiction over all
petitioners for determination of just compensation (judicial proceedings).
 DAR may make a preliminary determination of just compensation for lands taken under agrarian reform but it is
subject to challenge before the courts.
 RA 6657 was passed during pendency of the agrarian reform process. The just compensation here should be
determined in accordance with RA 6657, not PD 27.

Land Bank of the Phils. vs. CA GR No. 118712

Facts: Separate petitions for review were filed by petitioners Department of Agrarian Reform (DAR) (G.R. No.
118745) and Land Bank of the Philippines (LBP) (G.R. No. 118712) following the adverse ruling by the Court of
Appeals, granting private respondents' Petition for Certiorari and Mandamus. However, upon motion filed by
private respondents, the petitions were ordered consolidated. Likewise, petitioners seek the reversal of the
Resolution, denying their motion for reconsideration.

Private respondents are landowners whose landholdings were acquired by the DAR and subjected to
transfer schemes to qualified beneficiaries under the Comprehensive Agrarian Reform Law (CARL). Aggrieved by
the alleged lapses of the DAR and LBP with respect to the valuation and payment of compensation for their land
pursuant to the provisions of RA 6657, private respondents filed with the Court a Petition for Certiorari and
Mandamus with prayer for preliminary mandatory injunction. Private respondents argued that Administrative
Order No. 9, Series of 1990 was issued without jurisdiction and with grave abuse of discretion because it permits
the opening of trust accounts by the LBP, in lieu of depositing in cash or bonds in an accessible bank designated by
the DAR, the compensation for the land before it is taken and the titles are cancelled as provided under Section
16(e) of RA 6657. Private respondents also assail the fact that the DAR and the LBP merely "earmarked",
"deposited in trust" or "reserved" the compensation in their names as landowners despite the clear mandate that
before taking possession of the property, the compensation must be deposited in cash or in bonds. The respondent
court rendered the assailed decision in favor of private respondents. Petitioners filed a motion for reconsideration
but respondent court denied the same, hence, the instant petitions.

Issue: Whether or not the deposit may be made in other forms besides cash or LBP bonds

Held: In the present suit, the DAR clearly overstepped the limits of its power to enact rules and regulations when
it issued Administrative Circular No. 9. There is no basis in allowing the opening of a trust account in behalf of the
landowner as compensation for his property because Section 16(e) of RA 6657 is very specific that the deposit
must be made only in "cash" or in "LBP bonds". If it were the intention to include a "trust account" among the valid
modes of deposit that should have been made express, or at least, qualifying words ought to have appeared from
which it can be fairly deduced that a "trust account" is allowed.

The ruling in the "Association" case merely recognized the extraordinary nature of the expropriation to be
undertaken under RA 6657 thereby allowing a deviation from the traditional mode of payment of compensation
and recognized payment other than in cash. It did not, however, dispense with the settled rule that there must be
full payment of just compensation before the title to the expropriated property is transferred.

Issue: Whether or not there should be a distinction the deposit of compensation and determination of just
compensation

Held: To withhold the right of the landowners to appropriate the amounts already deposited in their behalf as
compensation for their properties simply because they rejected the DAR's valuation, and notwithstanding that they
have already been deprived of the possession and use of such properties is an oppressive exercise of eminent
domain. It is unnecessary to distinguish between deposit of compensation (provisional) under Section 16(e) and
determination of just compensation (final) under Section 18 for purposes of exercising the landowners' right to
appropriate the same. The immediate effect in both situations is the same the landowner is deprived of the use and
possession of his property for which he should be fairly and immediately compensated.

Landbank of the Philippines

vs Court of Appeals, Pedro Yap, Heirs of Emiliano Santiago, Agricultural Management and Development
Corp.
Ponente: Francisco
Facts:
Yap and Santiago are landowners whose landholdings were acquired by the DAR, subjecting it for transfer to
qualified CARP beneficiaries. Aggrieved by the compensation valuation of DAR and LBP, respondents filed a
petition for certiorari and mandamus with a preliminary mandatory injunction. The case was referred to CA for
proper determination and disposition.

Respondents argued that DAR and LBP committed grave abuse of discretion and acted without jurisdiction when
they opened trusts accounts in lieu of the depositing in cash or bonds, before the lands was taken and the titles are
cancelled. Respondents claim that before the taking of the property, the compensation must be deposited in cash or
bonds.

DAR, maintained that the certificate of deposit was a substantial compliance with the rule on taking and
compensation. LBP confirms that the certificate of deposit expresses "reserved/deposited".

CA ruled in favor of Yap and Santiago. DAR filed a petition.  DAR, maintain that the word "deposit" referred merely
to the act of depositing and in no way excluded the opening of a trust account as form of deposit.

Issue: Whether the opening of trust account tantamount to deposit.

Ruling:
Contention of DAR is untenable. Section 16 of RA 6657 provides: (e)        Upon receipt by the landowner of the
corresponding payment or, in case of rejection or no response from the landowner, upon the deposit with an
accessible bank designated by the DAR of the compensation in cash or in LBP bonds in accordance with this Act,
the DAR shall take immediate possession of the land and shall request the proper Register of Deeds to issue a
Transfer Certificate of Title (TCT) in the name of the Republic of the Philippines. . . . (emphasis supplied)

It is very explicit that the deposit must be made only in cash or LBP bonds, there is no ambiguity.

Lubrica vs Land Bank G.R. No. 170220, Nov. 20, 2006, 507 SCRA 415 (2006)

Facts:
Petitioners own parcels of agricultural lands in Mindoro Occidental which were placed under land reform pursuant
to PD 27.
The land was thereafter subdivided and distributed to farmer beneficiaries.

Petitioners rejected Land Bank’s valuation of their properties: P5,056,833.54 for the 311.7682 hectares (TCT No.
T-31) and P1,512,575.05 for the 128.7161 hectares.
On January 29, 2003, the PARAD fixed the preliminary just compensation at P51,800,286.43 for the 311.7682
hectares (TCT No. T-31) and P21,608,215.28 for the 128.7161 hectares.

LBP filed for judicial determination of just compensation before RTC. RTC ordered LBP to deposit the amounts
provisionally determined by the PARAD as there is no law which prohibits LBP to make a deposit pending the
fixing of the final amount of just compensation.

Court of Appeals  initially upheld Regional Trial Court decision.

However, CA, in its Amended Decision, held that the immediate deposit of the preliminary value of the
expropriated properties is improper because it was erroneously computed. Citing Gabatin v. Land Bank of the
Philippines, it held that the formula to compute the just compensation should be: Land Value = 2.5 x Average Gross
Production x Government Support Price. Specifically, it held that the value of the government support price for the
corresponding agricultural produce (rice and corn) should be computed at the time of the legal taking of the
subject agricultural land, that is, on October 21, 1972 when landowners were effectively deprived of ownership
over their properties by virtue of P.D. No. 27. According to the Court of Appeals, the PARAD incorrectly used the
amounts of P500 and P300 which are the prevailing government support price for palay and corn, respectively, at
the time of payment, instead of P35 and P31, the prevailing government support price at the time of the taking in
1972.

Issue: Whether or not the court a quo has decided the case in a way not in accord with the latest decision of the
Supreme Court in the case of Land Bank of the Philippines vs. Hon. Eli G.C. Natividad, et al., G.R. No. 127198, prom.
May 16, 2005

Held:
YES. The Natividad case reiterated the Court’s ruling in Office of the President v. Court of Appeals that the
expropriation of the landholding did not take place on the effectivity of P.D. No. 27 on October 21, 1972 but seizure
would take effect on the payment of just compensation judicially determined.
Likewise, in the recent case of Heirs of  Tantoco, Sr. v. Court of Appeals, we held that expropriation of landholdings
covered by R.A. No. 6657 take place, not on the effectivity of the Act on June 15, 1988, but on the payment of just
compensation.

In the instant case, petitioners were deprived of their properties in 1972 but have yet to receive the just
compensation therefor. The parcels of land were already subdivided and distributed to the farmer-beneficiaries
thereby immediately depriving petitioners of their use. Under the circumstances, it would be highly inequitable on
the part of the petitioners to compute the just compensation using the values at the time of the taking in 1972, and
not at the time of the payment, considering that the government and the farmer-beneficiaries have already
benefited from the land although ownership thereof have not yet been transferred in their names. Petitioners were
deprived of their properties without payment of just compensation which, under the law, is a prerequisite before
the property can be taken away from its owners. The transfer of possession and ownership of the land to the
government are conditioned upon the receipt by the landowner of the corresponding payment or deposit by the
DAR of the compensation with an accessible bank. Until then, title remains with the landowner.

Estribillo vs. Department of Agrarian Reform G.R. No. 159674 June 30, 2006

Doctrines: (a) Certificate of Title issued pursuant to Emancipation Patents are as indefeasible as TCTs issued in
registration proceedings; (b) The certificate of title becomes indefeasible and incontrovertible upon the expiration
of one year from the date of the issuance of the order for the issuance of the patent; (c) The Emancipation Patents
themselves, like the Certificate of Land Ownership Award (CLOAs) in Republic Act No. 6657 (the Comprehensive
Agrarian Reform Law of 1988), are enrolled in the Torrens system of registration.

Facts: This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, seeking the review and
reversal of the Resolutions of the Court of Appeals.

The petitioners are the recipients of Emancipation Patents (EPs) over parcels of land located at Barangay Angas,
Sta. Josefa, Agusan del Sur.

The parcels of land in this case, were formerly part of a forested area, which have been denuded as a result of the
logging operations of respondent Hacienda Maria, Inc. (HMI). Petitioners, together with other persons, occupied
and tilled these areas.

HMI acquired such forested area from the Republic of the Philippines through Sales Patent No. 2683 in 1956 by
virtue of which it was issued OCT No. P30771661.
On 21 October 1972, Presidential Decree No. 27 was issued mandating that tenanted rice and corn lands be
brought under Operation Land Transfer and awarded to farmer-beneficiaries.

HMI, through a certain Joaquin Colmenares, requested that 527.8308 hectares of its landholdings be placed under
the coverage of Operation Land Transfer. Receiving compensation therefor, HMI allowed petitioners and other
occupants to cultivate the landholdings so that the same may be covered under said law.

HMI, through its representatives, actively participated in all relevant proceedings, including the determination of
the Average Gross Production per hectare at the Barangay Committee on Land Production, and was a signatory of
an undated Landowner and Tenant Production Agreement (LTPA), covering the 527.8308 hectares. The LTPA was
submitted to the Land Bank of the Philippines (LBP) in 1977.

In 1982, a final survey over the entire area was conducted and approved. From 1984 to 1988, the corresponding
TCTs and EPs covering the entire 527.8308 hectares were issued to petitioners, among other persons.

In December 1997, HMI filed with the Regional Agrarian Reform Adjudicator (RARAD) of CARAGA, Region XIII,
petitions seeking the declaration of erroneous coverage under Presidential Decree No. 27 of 277.5008 hectares of
its former landholdings. HMI claimed that said area was not devoted to either rice or corn, that the area was
untenanted, and that no compensation was paid therefor.

RARAD: On 27 November 1998, after petitioners failed to submit a Position Paper, the RARAD rendered a Decision
declaring as void the TCTs and EPs awarded to petitioners because the land covered was not devoted to rice and
corn, and neither was there any established tenancy relations between HMI and petitioners when Presidential
Decree No. 27 took effect on 21 October 1972.

DARAB: Petitioners appealed to the Department of Agrarian Reform Adjudication Board (DARAB), which affirmed
the RARAD Decision.

CA: The Court of Appeals dismissed the petition for violation of Sec. 5, Rule 7 of the 1997 Rules of Civil Procedure.

Hence, this petition contending that there had been compliance with Rule 7, Section 5 of the 1997 Rules of Civil
Procedure. Moreover, reiterating that EPs are ordinary titles, which become indefeasible one year after the
registration.

Issue: Whether or not the transfer certificates of title issued pursuant to Emancipation Patents acquire the same
protection accorded to other Transfer Certificates of Title.

Rule: The Supreme Court granted the petitions. The resolutions of the Court of Appeals are reversed and
set aside. The EPs and the corresponding TCTs issued to petitioners or to their successors-in-interest are
declared valid and subsisting.

Procedural issue (I included this because it’s important in the case and the Supreme Court reiterated the concept of
Social Justice in determining the validity of the petition): With the CA dismissing the petition for violation of Sec. 5,
Rule 7 of the 1997 Rules of Civil Procedure, the Supreme Court ruled that the Petitioners have sufficiently complied
with Rule 7, Section 5 of the 1997 Rules of Civil Procedure concerning the Certification Against Forum Shopping. In
the case, Petitioner Samuel A. Estribillo, in signing the Verification and Certification Against Forum Shopping, falls
within the phrase “plaintiff or principal party” who is required to certify under oath the matters mentioned in Rule
7, Section 5 of the 1997 Rules of Civil Procedure. Moreover, even if we assume for the sake of argument that there
was violation of Rule 7, Section 5 of the 1997 Rules of Civil Procedure, a relaxation of such rule would be justified
for two compelling reasons: social justice considerations and the apparent merit of the Petition.

Substantial issue: YES. Certificate of Title issued pursuant to Emancipation Patents are as indefeasible as TCTs
issued in registration proceedings. After complying with the procedure, therefore, in Section 105 of Presidential
Decree No. 1529, otherwise known as the Property Registration Decree (where the DAR is required to issue the
corresponding certificate of title after granting an EP to tenant-farmers who have complied with Presidential
Decree No. 27), the TCTs issued to petitioners pursuant to their EPs acquire the same protection accorded to other
TCTs. “The certificate of title becomes indefeasible and incontrovertible upon the expiration of one year from the date
of the issuance of the order for the issuance of the patent, x x x. Lands covered by such title may no longer be the
subject matter of a cadastral proceeding, nor can it be decreed to another person (Ybañez v. Intermediate Appellate
Court). ”
The EPs themselves, like the Certificates of Land Ownership Award (CLOAs) in Republic Act No. 6657 (the
Comprehensive Agrarian Reform Law of 1988), are enrolled in the Torrens system of registration. The Property
Registration Decree in fact devotes Chapter IX on the subject of EPs. Indeed, such EPs and CLOAs are, in
themselves, entitled to be as indefeasible as certificates of title issued in registration proceedings.
Heirs of Deleste v. Land Bank of the Philippines NOTES:
[G.R. No. 169913, Jun. 08, 2011]
TOPIC: Substantive due process – Due process and
property rights
PONENTE: Velasco, Jr., J.
FACTS:

 Spouses Gregorio Nanaman and Hilaria Tabuclin – owners of a parcel of agricultural land in Tambo, Iligan
City; they were childless and only had Virgilio Nanaman (son of Gregorio by another woman)
 Gregorio died in 1945, Hilaria and Virgilio administered the Iligan property and subsequently sold this to
Dr. Jose Deleste
 Hilaria died in 1954, Gregorio’s brother – Noel was appointed as regular administrator of the estate, he
then filed an action for reversion of the title of the property, this case went up to the SC where it was
ruled that the property was the conjugal property of Nanaman spouses and so Hilaria can only sell ½ of
the land
 Deleste and the intestate estate of Gregorio were then held to be co-owners of the property
 PD 21 was issued in 1972 - DECREEING THE EMANCIPATION OF TENANTS FROM THE BONDAGE OF
THE SOIL, TRANSFERRING TO THEM THE OWNERSHIP OF THE LAND THEY TILL AND PROVIDING THE
INSTRUMENTS AND MECHANISM THEREFOR – property was placed under the Operation Land Transfer
program, however only the heirs of Gregorio were identified by Department of Agrarian Reform as
landowners
 In 1975, the City of Iligan passed an ordinance -- “Zoning Regulation of Iligan City” which reclassified the
land into commercial/residential
 In 1984, the DAR issued Certificates of Land Transfer in favor of private respondents who were the
tenants and actual cultivators of the land
 In 2001, Emancipation Patents and Original Certificates of Title were issued to the private respondents
 City of Iligan expropriated a part of the property – as the issue of ownership was pending, the just
compensation was deposited with the Development Bank of the Philippines held in trust for the RTC of
Iligan City
 Petitioners Heirs of Deleste filed with the Department of Agrarian Reform Adjudication Board (DARAB) a
petition seeking to nullify the EP’s issued to the private respondents
 Provincial Agrarian Reform Adjudicator (PARAD) declared the EP’s null and void, in view of the
pending issues of ownership, the subsequent reclassification of the property into a
residential/commercial land and the violation of petitioner’s constitutional right to due process of
law
 Private respondents filed a Notice of Appeal, while the petitioners filed a Motion for Writ of Execution
 DARAB reversed the ruling of PARAD and held the EP’s were valid and that the petitioners Heirs of
Deleste should have been the one informed by DAR at the time the property was placed under the OLT
program
 Petitioners filed a petition for review with the CA which was denied for failure to attach the writ of
execution, a subsequent motion for reconsideration was filed and denied
 Petitioners filed with the SC a petition for review which was denied as no reversible error was shown,
they then filed an MR which the SC granted and gave due course – hence this proceeding
ISSUE(S):
1. Were the petitioner’s constitutional right to due process violated by DAR (for failure to send notice)?

2. Is the property covered by the agrarian reform program?

3. Is the property covered by PD 27?

HELD:

1. YES. DAR violated the petitioner’s right to due process when it failed to notify them that the property
will be covered by the agrarian reform program

2. NO. It is outside the coverage of the agrarian reform program in view of the enactment of the local
zoning ordinance.

3. NO. Even if under PD 27, tenant-farmers are deemed owners as of October 21, 1972, this is not to be
Department of Agrarian Reform, Quezon City v. Carriedo

FACTS: The land in dispute is originally part of the agricultural land owned by Roman De Jesus. Petitioner Pablo
Mendoza became the tenant of the land by virtue of a Contrato King Pamamuisan executed between him and
Roman. On November 7, 1979, Roman died leaving the entire 73.3157 hectares to his surviving wife Alberta
Constales, and their two sons Mario and Antonio De Jesus. On June 26, 1986, Mario sold approximately 70.4788
hectares to respondent Romeo C. Carriedo.

The area sold to Carriedo included the land tenanted by Mendoza (TCT No. 17680). Mendoza alleged that the sale
took place without his knowledge and consent. Carriedo sold all of these landholdings to the Peoples’ Livelihood
Foundation, Inc. (PLFI), except the land tenanted by Mendoza. The landholding covered by TCT No. 17680 with an
area of 12.1065 hectares was divided into sub-lots. 7.1065 hectares was transferred to Bernabe Buscayno et al.
through a Deed of Transfer under PD No. 27. And the remaining lots consisting of approximately 5.0001 hectares
and which is the land being occupied by Mendoza, were registered in the name of Carriedo.

Carriedo then filed a Complaint for Ejectment and Collection of Unpaid Rentals against Mendoza. A decision was
rendered in favor of Carriedo and declared him as the absolute owner of the five(5) hectare land. Mendoza then
filed a Petition for Redemption. The CA ruled that Carriedo’s ownership of the land had been conclusively
established and even affirmed by this Court. Mendoza, his daughter Corazon Mendoza and Orlando Gomez filed a
Petition for Coverage of the land under RA No. 6657. They claimed that they had been in physical and material
possession of the land as tenants since 1956, and made the land productive. However, the CA declared the land as
Carriedo’s retained area.

Hence, this petition.

ISSUE: Whether Carriedo has the right to retain the land.

RULING: YES, Carriedo did not waive his right of retention over the land.

The 1987 Constitution expressly recognizes landowner retention rights under Article XIII, Section 4. Further, Sec.6
of RA No. 6657 implements this directive, thus:

Section 6. Retention Limits. — Except as otherwise provided in this Act, no person may own or retain, directly or
indirectly, any public or private agricultural land, the size of which shall vary according to factors governing a
viable family-size farm, such as commodity produced, terrain, infrastructure, and soil fertility as determined by the
Presidential Agrarian Reform Council (PARC) created hereunder, but in no case shall retention by the
landowner exceed five (5) hectares.

To interpret Section 6 of RA No. 6657, DAR issued Administrative Order No. 02, Series of 2003 (DAR AO 02-03),
which provides for the instances when a landowner is deemed to have waived his right of retention. Petitioners
claim that Carriedo lose his right of retention by disposing of his agricultural land on the ground of paragraph 4
Section 6 of RA No. 6657 (6.4 Execution of a Landowner Tenant Production Agreement and Farmer’s
Undertaking (LTPA-FU) or Application to Purchase and Farmer’s Undertaking (APFU) covering subject property).

However, Section 6 clearly shows that the disposition of agricultural land is not an act constituting waiver of the
right of retention. Thus, as correctly held by the CA, Carriedo “[n]ever committed any of the acts or omissions
above-stated (DAR AO 02-03). Not even the sale made by the herein petitioner in favor of PLFI can be considered
as a waiver of his right of retention. Likewise, the Records of the present case is bereft of any showing that the
herein petitioner expressly waived (in writing) his right of retention as required under sub-section 6.3, section 6,
DAR Administrative Order No. 02-S.2003.”

Under the facts of this case, the reasonable reading of Sections 6, 70 and 73 (a) of RA No. 6657 clearly do not
provide that a sale or disposition of land in excess of 5 hectares results in a forfeiture of the five hectare retention
area. In relation to the constitutional right of retention, the consequence of nullity pertains to the area/s which
were sold, or owned by the transferee, in excess of the 5-hectare land ceiling. Thus, the CA was correct in declaring
that the land is Carriedo’s retained area. Item no. 4 of DAR AO 05-06 imposes a penalty where none was provided
by law. As a necessary consequence of the invalidity of Item no. 4 of DAR AO 05-06 for being ultra vires, we hold
that Carriedo did not waive his right to retain the land, nor can he be considered to be in estoppel.

Department of Agrarian Reform vs. Carriedo G.R. No. 176549; 10 October 2018

Doctrine:
The equity in the policy of AO 05-06 is apparent. By sharing his landholdings, it is reasonably presumed
that the landowner already received an amount (as purchase price) commensurate to the just compensation
comfortable with the constitutional and statutory requirement. At this point, equity dictates that he cannot claim
anymore, either in the guise of his retention area or otherwise, that which he already received in the previous sale
of his land.
Facts:
In its 20 January 2016 Decision, the Supreme Court ruled that Carriedo did not waive his right of retention over
the subject landholding when he sold the same to the People’s Livelihood Foundation, Inc. (PLFI) without DAR
clearance, applying Section 6 of A.O. No. 02-03, which states that the disposition of agricultural land is not an act
constituting waiver of the right of retention. Moreover, in the same decision, the Court declared Item No. 4 of AO
No. 05-06 as void for being ultra vires because it appeared to provide terms that expand or modify some
provisions of the CARL.
The DAR filed for a motion for reconsideration of this Decision, arguing that the subject landholding cannot
be considered as the retained area of Carriedo because he has already exercised his right of retention when he
previously sold his landholdings with approximately 58.3723 hectares without DAR clearance. DAR contends that
Carriedo’s act of disposing his landholdings is tantamount to the exercise of his right of retention under the law.
DAR posits that the Decision “will provide landowners unbridled freedom to dispose any or all of their agricultural
properties without DAR clearance and still at a moment’s notice decide which of those lands he wishes to retain, to
the prejudice not only of the tenants and/or farmer beneficiaries but of the entire CARP as well.”
Furthermore, DAR argues that the objective of Item 4 of AO 05-06 is equitable— that in order to ensure the
effective implementation of the CARL, previous sales of landholdings without DAR clearance should be treated as
the exercise of retention rights of the landowner.
Issues:

(1) W/n Item No.4 of A.O. 05-06 is valid.

(2) W/n Carriedo’s sale of his landholdings to PLFI can be treated as the exercise of his retention rights such that
he cannot lawfully claim the subject landholding as his retained area anymore.
Ruling:

(1) YES, Item No. 4 of A.O. 05-06 is valid.

The equity in the policy of AO 05-06 is apparent. By sharing his landholdings, it is reasonably presumed
that the landowner already received an amount (as purchase price) commensurate to the just
compensation comfortable with the constitutional and statutory requirement. At this point, equity
dictates that he cannot claim anymore, either in the guise of his retention area or otherwise, that which he
already received in the previous sale of his land.

AO 05-06 is in consonance with the Stewardship Doctrine, which has been held to be the property concept in
Section 6, Article II of the 1987 Constitution. Under this concept, private property is supposed to be held by
the individual only as a trustee for the people in general, who are its real owners. The objective of the agrarian
reform program, which is to distribute land to the landless farmers and farmworkers, is carried out by Item 4
of AO 05-06 as it provides for the consequences in situations where a landowner had sold portions of his/her
land with an area more than the statutory limitation of 5 hectares. In this scenario, Item 4 of AO 05-06 treats
the sale of the first five hectares as the exercise of the landowner’s retention rights. The reason is that,
effectively, the landowner has already chosen, and in fact has already disposed of, and has been duly
compensated for, the area he is entitled to retain under the law. This legal consequence arising from the
previous sale of land therefore eliminates the prejudice, in terms of equitable land distribution, that may befall
the landless farmers and farmworkers.

(2) YES, Carriedo can no longer lawfully claim the subject landholding as his retained area.

The Court notes that the previous sale of Carriedo’s landholdings was made in violation of the law, being made
without the clearance of the DAR. To rule that Carriedo is still entitled to retain the subject landholding
will, in effect, reward the violation, which the Court cannot allow.

The right of retention serves to mitigate the effects of compulsory land acquisition by balancing the rights of
the landowner and the tenant, and by implementing the doctrine that social justice was not meant to
perpetrate an injustice against the landowner. In this case, however, Carriedo claims his right over the subject
landholding not because he was “deprived” of a portion of his land as a consequence of compulsory land
coverage, but precisely because he already previously sold his landholdings, so that the subject landholding is
the only portion left for him.