CASE DIGEST: DAR VS.

SUTTON

G.R. No. 162070 October 19, 2005

DEPARTMENT OF AGRARIAN REFORM, represented by SECRETARY

JOSE MARI B. PONCE (OIC), Petitioner
vs.
DELIA T. SUTTON, ELLA T. SUTTON-SOLIMAN and HARRY T.
SUTTON, Respondents.

FACTS:

In this case the respondents inherited land in Aroroy, Masbate, which has
been used exclusively for cattle-raising. In order to take advantage of
specific legal incentives, respondents submitted a voluntary offer to sell
(VOS) their landholdings to petitioner DAR on October 26, 1987, as part of
the government’s pre-existing agrarian reform program.

CARL (the Comprehensive Agrarian Reform Law of 1988) went into

effect on June 10, 1988.

Respondents officially requested that their VOS be withdrawn from petitioner

DAR in the context of the Luz Farms ruling because their landholding was
solely used for cattle-raising and was hence exempt from the CARL’s scope.

DAR issued A.O. No. 9, series of 1993, which stated that the CARL would not
apply to any private agricultural properties utilized for the production of
cattle, poultry, or swine as of June 15, 1988. The A.O. used the extent of
land to be excluded as criteria specified a 1:1 animal-to-land ratio as the
retention limit.

DAR Secretary Ernesto D. Garilao partially approved the application of

respondents for the exemption from CARL’s coverage. Reconsideration was
requested by respondents. They argued that because all of their property is
used for cattle-raising, it should be excluded. Their request was denied.

The DAR order was confirmed by the Office of the President.

The Court of Appeals decided in favor of the respondents in the appeal. The
DAR A.O. No. 9, s. 1993 was declared null and void since it violated the

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 CASE DIGEST: DAR VS. SUTTON

1987 Constitutional Commission’s intention to exclude animal farms from the

government’s land reform program.

ISSUE:

Whether or not the DAR A.O. No. 9, series of 1933, which prescribes a
maximum retention limit for owners of lands devoted to livestock raising is
constitutional.

RULING:

No. In the case at bar, we determine that the contested Administrative

Order is void because it contravenes the Constitution. The A.O. included
animal farms in the scope of agrarian reform and set a maximum ownership
retention restriction in an effort to manage them. However, the 1987
Constitutional Commission’s proceedings make it clear that they intended to
exclude inter alia– all areas used only for producing cattle, swine and
poultry. In the Luz Farms ruling the Supreme Court clarified that raising
livestock, including swine and poultry, is an industrial activity and does not
fit under the concept of agriculture or agricultural activity. The farming of
crops or trees is distinct from the cultivation of livestock, including swine and
poultry.

A significant portion of the investment in this business is made in the form of

industrial fixed assets, including animal housing structures and facilities,
drainage, waterers and blowers, a feed mill with grinders, mixers,
conveyors, exhausts and generators, extensive warehousing facilities for
feeds and other supplies, anti-pollution equipment like bio-gas and digester
plants augmented by lagoons and concrete ponds, deep wells, elevated
water tanks, pump houses, sprayers, and other technological appurtenances.

It is apparent that the petitioner DAR lacks the authority to control livestock
farms that are not subject to agrarian reform since they are protected by the
Constitution. In issuing the disputed A.O., it exceeded beyond its authority.