Republic Act No.

9700

August 7, 2009

AN ACT STRENGTHENING THE COMPREHENSIVE AGRARIAN REFORM

PROGRAM (CARP), EXTENDING THE ACQUISITION AND DISTRIBUTION OF
ALL AGRICULTURAL LANDS, INSTITUTING NECESSARY REFORMS, AMENDING
FOR THE PURPOSE CERTAIN PROVISIONS OF REPUBLIC ACT NO. 6657,
OTHERWISE KNOWN AS THE COMPREHENSIVE AGRARIAN REFORM LAW OF
1988, AS AMENDED, AND APPROPRIATING FUNDS THEREFOR
Section 19. Section 50 of Republic Act No. 6657, as amended, is hereby further
amended by adding Section 50-A to read as follows:
"SEC. 50-A. Exclusive Jurisdiction on Agrarian Dispute. - No court or
prosecutor's office shall take cognizance of cases pertaining to the
implementation of the CARP except those provided under Section 57 of
Republic Act No. 6657, as amended. If there is an allegation from any of the
parties that the case is agrarian in nature and one of the parties is a farmer,
farmworker, or tenant, the case shall be automatically referred by the judge
or the prosecutor to the DAR which shall determine and certify within fifteen
(15) days from referral whether an agrarian dispute exists: Provided, That
from the determination of the DAR, an aggrieved party shall have judicial
recourse. In cases referred by the municipal trial court and the prosecutor's
office, the appeal shall be with the proper regional trial court, and in cases
referred by the regional trial court, the appeal shall be to the Court of
Appeals.
"In cases where regular courts or quasi-judicial bodies have competent
jurisdiction, agrarian reform beneficiaries or identified beneficiaries and/or
their associations shall have legal standing and interest to intervene
concerning their individual or collective rights and/or interests under the
CARP.
"The fact of non-registration of such associations with the Securities and
Exchange Commission, or Cooperative Development Authority, or any
concerned government agency shall not be used against them to deny the
existence of their legal standing and interest in a case filed before such
courts and quasi-judicial bodies."

LAND CONVERSION (REFERENCE:

http://afrim.org.ph/IDLS/files/original/4e0171313f02a7b89fdbd08223a517d
6.pdf)
What is an illegal conversion?

It is the conversion of the landowners agricultural land into the following reasons:
With the intent to convert the land into any non-agricultural use and to avoid the
application of RA 6657 to its landholdings;
With the intent to dispossess the landowners tenant farmers; or
To sell, transfer, convey or change the nature of lands outside urban centers and
city limits, either in whole or in part, after the affectivity of RA 6657.

What are the different ways in committing illegal conversion?

There are two ways of committing illegal conversion:
Elements of the 1st type:
The offender is the landowner
He/She converts his/her agricultural land into non-agricultural use without
authority or clearance from DAR
The intention of the conversion is to avoid the application of RA 6657 and to
dispossess the farmers of the land tilled by them
Elements of the 2nd type:
Offender is the landowner
He/She changes the nature of the agricultural land, in whole or in part
Land is located outside urban centers and city limits
Act was committed after 15 June 1988

G.R. No. 78517 February 27, 1989

GABINO ALITA, JESUS JULIAN, JR., JESUS JULIAN, SR., PEDRO RICALDE,
VICENTE RICALDE and ROLANDO SALAMAR, petitioners,
vs.
THE HONORABLE COURT OF APPEALS, ENRIQUE M. REYES, PAZ M. REYES
and FE M. REYES,respondents.
Bureau of Agrarian Legal Assistance for petitioners.

Leonardo N. Zulueta for Enrique Reyes, et al. Adolfo S. Azcuna for private
respondents.

PARAS, J.:
Before us is a petition seeking the reversal of the decision rendered by the
respondent Court of Appeals**on March 3, 1987 affirming the judgment of the court
a quo dated April 29, 1986, the dispositive portion of the trial court's decision
reading as follows;
WHEREFORE, the decision rendered by this Court on November 5, 1982
is hereby reconsidered and a new judgment is hereby rendered:
1. Declaring that Presidential Decree No. 27 is inapplicable to lands
obtained thru the homestead law,
2. Declaring that the four registered co-owners will cultivate and
operate the farmholding themselves as owners thereof; and
3. Ejecting from the land the so-called tenants, namely; Gabino Alita,
Jesus Julian, Sr., Jesus Julian, Jr., Pedro Ricalde, Vicente Ricalde and
Rolando Salamar, as the owners would want to cultivate the
farmholding themselves.
No pronouncement as to costs.
SO ORDERED. (p. 31, Rollo)
The facts are undisputed. The subject matter of the case consists of two (2) parcels
of land, acquired by private respondents' predecessors-in-interest through
homestead patent under the provisions of Commonwealth Act No. 141. Said lands
are situated at Guilinan, Tungawan, Zamboanga del Sur.
Private respondents herein are desirous of personally cultivating these lands, but
petitioners refuse to vacate, relying on the provisions of P.D. 27 and P.D. 316 and
appurtenant regulations issued by the then Ministry of Agrarian Reform (DAR for
short), now Department of Agrarian Reform (MAR for short).
On June 18, 1981, private respondents (then plaintiffs), instituted a complaint
against Hon. Conrado Estrella as then Minister of Agrarian Reform, P.D. Macarambon
as Regional Director of MAR Region IX, and herein petitioners (then defendants) for

the declaration of P.D. 27 and all other Decrees, Letters of Instructions and General
Orders issued in connection therewith as inapplicable to homestead lands.
Defendants filed their answer with special and affirmative defenses of July 8, 1981.
Subsequently, on July 19, 1982, plaintiffs filed an urgent motion to enjoin the
defendants from declaring the lands in litigation under Operation Land Transfer and
from being issued land transfer certificates to which the defendants filed their
opposition dated August 4, 1982.
On November 5, 1982, the then Court of Agrarian Relations 16th Regional District,
Branch IV, Pagadian City (now Regional Trial Court, 9th Judicial Region, Branch XVIII)
rendered its decision dismissing the said complaint and the motion to enjoin the
defendants was denied.
On January 4, 1983, plaintiffs moved to reconsider the Order of dismissal, to which
defendants filed their opposition on January 10, 1983.
Thus, on April 29, 1986, the Regional Trial Court issued the aforequoted decision
prompting defendants to move for a reconsideration but the same was denied in its
Order dated June 6, 1986.
On appeal to the respondent Court of Appeals, the same was sustained in its
judgment rendered on March 3, 1987, thus:
WHEREFORE, finding no reversible error thereof, the decision appealed
from is hereby AFFIRMED.
SO ORDERED. (p. 34, Rollo)
Hence, the present petition for review on certiorari.
The pivotal issue is whether or not lands obtained through homestead patent are
covered by the Agrarian Reform under P.D. 27.
The question certainly calls for a negative answer.
We agree with the petitioners in saying that P.D. 27 decreeing the emancipation of
tenants from the bondage of the soil and transferring to them ownership of the land
they till is a sweeping social legislation, a remedial measure promulgated pursuant
to the social justice precepts of the Constitution. However, such contention cannot
be invoked to defeat the very purpose of the enactment of the Public Land Act or
Commonwealth Act No. 141. Thus,

The Homestead Act has been enacted for the welfare and protection of
the poor. The law gives a needy citizen a piece of land where he may
build a modest house for himself and family and plant what is
necessary for subsistence and for the satisfaction of life's other needs.
The right of the citizens to their homes and to the things necessary for
their subsistence is as vital as the right to life itself. They have a right
to live with a certain degree of comfort as become human beings, and
the State which looks after the welfare of the people's happiness is
under a duty to safeguard the satisfaction of this vital right. (Patricio v.
Bayog, 112 SCRA 45)
In this regard, the Philippine Constitution likewise respects the superiority of the
homesteaders' rights over the rights of the tenants guaranteed by the Agrarian
Reform statute. In point is Section 6 of Article XIII of the 1987 Philippine Constitution
which provides:
Section 6. The State shall apply the principles of agrarian reform or
stewardship, whenever applicable in accordance with law, in the
disposition or utilization of other natural resources, including lands of
public domain under lease or concession suitable to agriculture,
subject to prior rights, homestead rights of small settlers, and the
rights of indigenous communities to their ancestral lands.
Additionally, it is worthy of note that the newly promulgated Comprehensive
Agrarian Reform Law of 1988 or Republic Act No. 6657 likewise contains a proviso
supporting the inapplicability of P.D. 27 to lands covered by homestead patents like
those of the property in question, reading,
Section 6. Retention Limits. ...
... Provided further, That original homestead grantees or their direct
compulsory heirs who still own the original homestead at the time of
the approval of this Act shall retain the same areas as long as they
continue to cultivate said homestead.'
WHEREFORE, premises considered, the decision of the respondent Court of Appeals
sustaining the decision of the Regional Trial Court is hereby AFFIRMED.
SO ORDERED.

[G.R. No. 139083. August 30, 2001]

FLORENCIA PARIS, petitioner, vs. DIONISIO A. ALFECHE, JUAN L. ALFECHE,

MAXIMO N. PADILLA, DIONISIO Q. MATILOS, Heirs of GREG A.
ALFECHE, DIONISIO W. MATILO, SIMPLICIO L. ADAYA, TEOFILO M. DE
GUZMAN, FRANCISCO B. DINGLE and MARIFE NAVARO, respondents.
DECISION
PANGANIBAN, J.:
Homesteads are not exempt from the operation of the Land Reform Law. The
right to retain seven hectares of land is subject to the condition that the landowner
is actually cultivating that area or will cultivate it upon the effectivity of the said law.
The Case
The Petition for Review before us assails the June 4, 1999 Decision of the Court
of Appeals[1] (CA), in CA-GR SP No. 45738, which affirmed the ruling of the
Department of Agrarian Reform Adjudication Board (DARAB). The decretal portion
of the CA Decision reads:
WHEREFORE, [there being] no grave abuse of discretion x x x committed by
DARAB, the instant petition is hereby DENIED DUE
COURSE andDISMISSED. Costs against the petitioner.[2]
The Decision of the DARAB, which was affirmed by the CA, had disposed as
follows:
WHEREFORE, premises considered, the assailed Decision dated March 19, 1992 is
hereby REVERSED and SET ASIDE, and a new one is entered:
1.
Declaring the private respondents to be full owners of the land they till
pursuant to Presidential Decree No. 27 and Executive Order No. 228;
2.
Declaring the validity of the Emancipation Patents issued to private
respondents; and
3.

Dismissing the case.[3]

The Facts
The Court of Appeals narrates the facts thus:

Petitioner is the registered owner of a parcel of land situated at Paitan, Quezon,

Bukidnon with an area of 10.6146 hectares, more or less, covered by Transfer

Certificate of Title No. T-8275 and another property with an area of 13.2614
hectares covered by Original Certificate of Title No. P-4985, also located at Paitan,
Quezon, Bukidnon; the said parcels are fully tenanted by private respondents herein
who are recipients of Emancipation Patents in their names pursuant to Operation
Land Transfer under P.D. 27 (Annexes A, A-1 to A-18) notwithstanding the fact that
neither the tenants nor the Land Bank of the Philippines (LBP) [has] paid a single
centavo for the said land. Petitioner and the tenants have not signed any Land
Transfer Production Agreement. Petitioner and her children have been deprived of
their property without due process of law and without just compensation, especially
so that the tenants have already stopped paying rentals as of December 1988 to
the damage and prejudice of petitioner.
Petitioner contends that since she is entitled to a retention of seven (7) hectares
under P.D. 27 and/or 5 hectares and 3 hectares each for her children under the
Comprehensive Agrarian Reform Law (CARL), the tenants are not supposed to
acquire the subject land and the Emancipation Patents precipitately issued to them
are null and void for being contrary to law. Petitioner further alleged that she owns
the subject property covered by OCT No. P-4985 as original homestead grantee who
still owned the same when Republic Act No. 6657 was approved, thus she is entitled
to retain the area to the exclusion of her tenants. As regards TCT No. 8275,
petitioner has applied for retention of seven hectares per Letter of Retention
attached as Annex B, that the lands subject of the instant petition are covered by
Homestead Patents, and as decided by the Supreme Court in the cases of Patricio
vs. Bayug (112 SCRA 41) and Alita vs. Court of Appeals (170 SCRA 706), the
homesteaders and their heirs have the right to cultivate their homesteads
personally, which is a superior right over that of tenant-farmers.
Petitioner moved for the cancellation and recall of the Emancipation Patents issued
to private respondents-farmers and to restore to petitioner and her children the
ownership and cultivation of the subject lots plus payment of back rentals from the
time they stopped paying the same until ejected therefrom.
Respondents filed their answer dated May 29, 1991 and admitted the generation
and issuance of Emancipation Patents to private respondents as tenant-farmers
thereof and the Supreme Court rulings on the Bayug and Alita cases relative to
homestead patents, but denied the rest of the material allegations for want of
knowledge or information as to the truth relative thereto. Respondents alleged that
when the subject lands were covered under P.D. 27, the petitioner was repeatedly
informed and invited by the DAR Office at Valencia, Bukidnon to thresh out the
matter; that petitioners right to retain seven (7) hectares is not absolute since she
owns other agricultural landholdings, thus disqualifying her to retain the area, aside
from the fact that she has other properties sufficient to support her family as shown
in the Certification of the Provincial Assessors Office listing down the petitioners
landholdings (Annex 2). By way of special affirmative defenses, respondents

averred that the criteria set forth under P.D. 27 were observed before the
generation of the Emancipation Patents; that under Executive Order No. 228, the
tenant-farmers under P.D. 27 are deemed full owners of the lands they till and the
lease rentals paid by them should be considered as amortization payments; that
under LOI 474, petitioner who owns more than seven (7) hectares of lands are not
entitled to retention. Respondents prayed for the dismissal of the case. They
likewise prayed that the Emancipation Patents issued to private respondents and
their peaceful possession of their farm lots be respected.
The Adjudicator a quo conducted a hearing and afforded the parties their day in
court and the opportunity to present their evidence. On August 13, 1991, the
Adjudicator a quo issued an Order for the parties to submit their respective position
papers with evidence to buttress their allegations. On March 10, 1992, the
Adjudicator a quo rendered the decision, thus:
WHEREFORE, in the light of the foregoing, this Adjudicator declares the following:
1. That all the Emancipation Patents issued to tenants-respondents shall be
cancelled and recalled;
2. That the Register of Deeds of Malaybalay, Bukidnon shall cancel all
Emancipation Patents registered under the names of the herein tenantsrespondents; and
3. That back rentals due to the petitioners, which were given to the LBP as
amortizations, shall be given to the said petitioner. [4]
On appeal, the DARAB reversed the adjudicator.
Ruling of the Court of Appeals
The CA rejected the claim of petitioner. It ruled that she could not retain her
homesteads, since she was not the actual cultivator thereof. It also held that she
and her heirs had not been deprived of their right to retain the area mandated by
law, because the records showed that they had other agricultural
landholdings. Finally, it ruled that she had not been deprived of her properties
without just compensation, since Section 2 of Executive Order 228 declared that
tenant-farmers of agricultural lands under P.D. 27 are deemed owners of the land
they till and the lease rentals paid by them shall be considered as amortization
payments.[5]
Hence, this Petition.[6]
The Issues

In her Memorandum,
consideration:

petitioner

submits

the

following

issues

for

our

I. Whether or not the original homesteads issued under the public land act [are]
exempted from the operation of land reform.
II.
Granting arguendo that homesteads are not exempt, whether or not the
Emancipation Patents issued to the respondents are valid notwithstanding lack of
payment of just compensation.
III.
On the assumption that homesteads are exempt from land reform and/or
the emancipation patents are illegally issued hence, void, can the respondents be
ejected from the premises in question? [7]
The Courts Ruling
The Petition is partly meritorious. Respondents are entitled to the lands they till,
subject to the determination and payment of just compensation to petitioner.
First Issue: Petitioners Homesteads Not Exempt from Land Reform
Petitioner contends that because the subject properties are covered by
homestead patents, they are exempt from the operation of land reform. In support
of her position, she cites the cases Alita v. CA[8] and Patricio v. Bayug,[9] in which the
Court ruled that homesteaders had a superior right to cultivate their homesteads as
against their tenants.
Petitioners contention is without legal basis. Presidential Decree (PD) No. 27,
under which the Emancipation Patents sought to be cancelled here were issued to
respondents, applies to all tenanted private agricultural lands primarily devoted to
rice and corn under a system of share-crop or lease-tenancy, whether classified as
landed estate or not.[10] The law makes no exceptions whatsoever in its
coverage. Nowhere therein does it appear that lots obtained by homestead patents
are exempt from its operation.
The matter is made even clearer by Department Memorandum Circular No. 2,
Series of 1978, which states: Tenanted private agricultural lands primarily devoted
to rice and/or corn which have been acquired under the provisions of
Commonwealth Act 141, as amended, shall also be covered by Operation Land
Transfer. Unquestionably, petitioners parcels of land, though obtained by
homestead patents under Commonwealth Act 141, are covered by land reform
under PD 27.

Petitioners claimed entitlement to retain seven (7)

untenable. PD 27, which provides the retention limit, states:

hectares

is

also

In all cases, the landowner may retain an area of not more than seven (7) hectares
if such landowner is cultivating such area or will now cultivate it.
Clearly, the right to retain an area of seven hectares is not absolute. It is
premised on the condition that the landowner is cultivating the area sought to be
retained or will actually cultivate it upon effectivity of the law.
In the case at bar, neither of the conditions for retention is present. As admitted
by petitioner herself, the subject parcels are fully tenanted; thus, she is clearly not
cultivating them, nor will she personally cultivate any part thereof. Undoubtedly,
therefore, she has no right to retain any portion of her landholdings.
Even under the current primary law on agrarian reform, Republic Act (RA) No.
6657, to which the application of PD 27 is suppletory, petitioners lands are subject
to land reform. The said Act lays down the rights of homestead grantees as follows:
SEC. 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-sized 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. Three (3) hectares
may be awarded to each child of the landowner, subject to the following
qualifications: (1) that he is at least fifteen (15) years of age; and (2) that he is
actually tilling the land or directly managing the farm; Provided, That landowners
whose lands have been covered by PD 27 shall be allowed to keep the area
originally retained by them thereunder; Provided, further, That original homestead
grantees or their direct compulsory heirs who still own the original homestead at
the time of the approval of this Act shall retain the same areas as long as they
continue to cultivate said homestead. (italics supplied)
Indisputably, homestead grantees or their direct compulsory heirs can own and
retain the original homesteads, only for as long as they continue to
cultivatethem. That parcels of land are covered by homestead patents will not
automatically exempt them from the operation of land reform. It is the fact of
continued cultivation by the original grantees or their direct compulsory heirs that
shall exempt their lands from land reform coverage.
In the present case, as previously pointed out, neither petitioner nor her heirs
are personally cultivating the subject homesteads. The DAR and the CA found that

respondents were the ones who had been cultivating their respective portions of the
disputed properties.
However, petitioner can retain five (5) hectares in accordance with Section 6 of
RA 6657, which requires no qualifying condition for the landowner to be entitled to
retain such area. This ruling is in line with Association of Small Landowners in the
Philippines, Inc. v. Secretary of Agrarian Reform, from which we quote:
x x x. In any event, assuming that the petitioners have not yet exercised their
retention rights, if any, under PD No. 27, the Court holds that they are entitled to
the new retention rights provided for by RA No. 6657, which in fact are on the whole
more liberal than those granted by the decree.
Petitioners heirs, however, are not entitled to awards of three (3) hectares
each, since they are not actually tilling the parcels or directly managing the farm.
Patricio v. Bayug and Alita v. CA
Not Applicable
Petitioner insists that the appellate court ignored the ruling of the Court
in Patricio v. Bayug[11] and Alita v. CA.[12] She relies on the following pronouncement
in Patricio: We hold that the more paramount and superior policy consideration is
to uphold the right of the homesteader and his heirs to own and cultivate personally
the land acquired from the State without being encumbered by tenancy
relations.[13] She also cites the statement in Alita that the inapplicability of P.D. 27
to lands covered by homestead patents like those of the property in question finds
support in the aforecited Section 6 of RA 6657. [14] A closer look at these cases shows
that they are not applicable to the issues in the present case.
In Patricio, the owner and his heirs had previously cultivated the homestead,
which was later sold but subsequently reconveyed to the former. After the
reconveyance, the owners heirs wanted to resume their cultivation of the
homestead, but the previous buyers tenants did not want to leave it. In Alita, the
owner was also desirous of personally cultivating the homestead; but the tenants,
not wanting to relinquish it, were asserting their own right to continue cultivating
it. Thus, under these circumstances, the Court upheld the right of the homestead
owners over that of the tenants.
In the case at bar, petitioner herself has not personally cultivated the parcels of
land. Neither has she or her heirs expressed, at any time, any desire to cultivate
them personally. She is invoking, yet is clearly not intending to ever actually
exercise, her alleged right as homesteader to own and personally cultivate them.

Thus, the rulings in both Patricio and Alita, which are in line with the state
objective of fostering owner cultivatorship[15] and of abolishing tenancy,[16] would be
inapplicable to the present case. Since petitioner and her heirs have evinced no
intention of actually cultivating the lands or even directly managing the farm, they
will undoubtedly continue to be absentee landlords. Therefore, to blindly and
indiscriminately apply the ruling in the cited cases would be tantamount to
encouraging feudalistic practices and going against the very essence of agrarian
reform. This we cannot sanction.
Second Issue: Just Compensation
It is undisputed that the subject parcels were covered by Operation Land
Transfer under PD 27, and that private respondents were identified as
beneficiaries. In fact, Emancipation Patents have already been issued to them.
Petitioner, however, claims that she was not paid just compensation and, thus,
prays for the cancellation of the Emancipation Patents issued to respondents under
PD 27. She contends that it is illegal for the DAR to take property without full
payment of just compensation[;] until full payment is done the title and ownership
remain with the landholder. [17]
Petitioners contention has merit. Section 2 of PD 266 states:
After the tenant-farmer shall have fully complied with the requirements for a grant
of title under Presidential Decree No. 27, an Emancipation Patent and/or Grant shall
be issued by the Department of Agrarian Reform on the basis of a duly approved
survey plan.
On the other hand, paragraphs 8 and 9 of PD 27 reads as follows:
For the purpose of determining the cost of the land to be transferred to the tenantfarmer pursuant to this Decree, the value of the land shall be equivalent to two and
one-half (2 ) times the average harvest of three normal crop years immediately
preceding the promulgation of this Decree;
The total cost of the land, including interest at the rate of six (6) per centum per
annum, shall be paid by the tenant in fifteen (15) years of fifteen (15) equal annual
amortizations[.]
Although, under the law, tenant farmers are already deemed owners of the land
they till, they are still required to pay the cost of the land, including interest, within
fifteen years before the title is transferred to them. Thus, the Court held
in Association of Small Landowners in the Philippines v. Secretary of Agrarian
Reform:[18]

It is true that PD 27 expressly ordered the emancipation of tenant-farmers as of

October 21, 1972 and declared that he shall be deemed the owner of a portion of
land consisting of a family-sized farm except that no title to the land owned by him
was to be actually issued to him unless and until he had become a full-fledged
member of a duly recognized farmers cooperative. It was understood, however,
that full payment of the just compensation also had to be made first, conformably
to the constitutional requirement.
In the case at bar, there is no showing that respondents complied with the
requirement of full payment of the cost of the parcels of land. As they themselves
admitted,[19] their value had not even been determined yet. In the absence of such
determination, the Court cannot rule that just compensation has already been fully
paid.
Presidential Decree 27 and subsequently Executive Order (EO) 228, which
recognized the rights acquired by tenant-farmers under PD 27, provide in detail the
computation to be used in arriving at the exact total cost of the parcels of
land. Evidently, therefore, the law recognizes that their exact value, or the just
compensation to be given to the landowner, cannot just be assumed; it must be
determined with certainty before the land titles are transferred.
Although EO 228 provides that the total lease rentals paid for the lands from
October 21, 1972 shall be considered as advance payment, it does not sanction the
assumption that such rentals are automatically considered as equivalent to just
compensation for the land. The provision significantly designates the lease rentals
as advance, not full, payment. The determination of the exact value of the lands
cannot simply be brushed aside, as it is fundamental to the determination of
whether full payment has been made.
Necessarily, the lease rentals admittedly paid by respondents until December
1988 cannot, at this point, be considered as full settlement of the value of the lands
or as just compensation for them. The value of the subject lands was never
determined; thus, there is no amount that can be used as basis for applying the
lease rentals.
Under the circumstances, actual title to the subject lands remains with
petitioner. Clearly then, under PD 27 and EO 228, the application of the process of
agrarian reform to the subject lands is still incomplete.
Considering the passage of RA 6657 before the completion of the application of
the agrarian reform process to the subject lands, the same should now be
completed under the said law, with PD 27 and EO 228 having only suppletory
effect. This ruling finds support in Land Bank of the Philippines v. CA,[20] wherein the
Court stated:

We cannot see why Sec. 18 of RA 6657 should not apply to rice and corn lands
under PD 27. Section 75 of RA 6657 clearly states that the provisions of PD 27 and
EO 228 shall only have a suppletory effect. Section 7 of the Act also provides --Sec. 7. Priorities. The DAR, in coordination with the PARC shall plan and program
the acquisition and distribution of all agricultural lands through a period of (10)
years from the effectivity of this Act. Lands shall be acquired and distributed as
follows:
Phase One: Rice and Corn lands under P.D. 27; all idle or abandoned lands; all
private lands voluntarily offered by the owners for agrarian reform; x x x and all
other lands owned by the government devoted to or suitable for agriculture, which
shall be acquired and distributed immediately upon the effectivity of this Act, with
the implementation to be completed within a period of not more than four (4) years
emphasis supplied).
This eloquently demonstrates that RA 6657 includes PD 27 lands among the
properties which the DAR shall acquire and distribute to the landless. And to
facilitate the acquisition and distribution thereof, Secs. 16, 17 and 18 of the Act
should be adhered to. In Association of Small Landowners of the Philippines v.
Secretary of Agrarian Reform this Court applied the provisions (of) RA 6657 to rice
and corn lands when it upheld the constitutionality of the payment of just
compensation for PD 27 lands through the different modes stated in Sec. 18.
In determining the amount to be paid petitioner, all lease rentals paid by
respondents to her after October 21, 1972 should be deducted therefrom. This
formula is intended to put into effect the provision of Section 2 of EO 228.
Third Issue: Tenants Cannot Be Ejected
Petitioner submits that aside from cancelling the Emancipation Patents issued to
respondents, the ejectment of the latter from the premises should be ordered by the
Court, in accordance with the doctrine in Patricio.
Petitioners position is unfounded. As earlier explained, Patricio finds no
application to the case at bar. Thus, there is no justification for ejecting
respondents. Besides, Section 22 of RA 6657 expressly states that actual tenanttillers in the landholding shall not be ejected or removed therefrom. Furthermore,
there is no reason for ejecting the tillers with respect to the area of five hectares,
which petitioner may choose to retain. Section 6 of RA 6657 further states:
The right to choose the area to be retained, which shall be compact or contiguous,
shall pertain to the landowner; Provided, however, That in case the area selected
for retention by the land owner is tenanted, the tenant shall have the option to

choose whether to remain therein or be a beneficiary in the same or another

agricultural land with similar or comparable features. In case the tenant chooses to
remain in the retained area, he shall be considered a lease holder and shall lose his
right to be a beneficiary under this Act. In case the tenant chooses to be a
beneficiary in another agricultural land, he loses his right as a lease-holder to the
land retained by the landowner. The tenant must exercise this option within a
period of one (1) year from the time the landowner manifests his choice of the area
for retention.
In all cases, the security of tenure of the farmers or farm workers on the land prior
to the approval of this Act shall be respected.
The current provision on retention removes the necessity, present under PD 27,
of ejecting actual tillers. Under the current law, landowners who do not personally
cultivate their lands are no longer required to do so in order to qualify for the
retention of an area not exceeding five hectares. Instead, they are now required to
maintain the actual tiller of the area retained, should the latter choose to remain
therein.
WHEREFORE, the Petition is partially GRANTED. The assailed Decision of the
Court of Appeals is hereby SET ASIDE. The Decision of the provincial agrarian
reform adjudicator is REINSTATED with the modification that the lease rentals, which
respondents have already paid to petitioner after October 21, 1972, are to be
considered part of the purchase price for the subject parcels of land.
SO ORDERED.

G.R. No. 86044 July 2, 1990

VICTORINO TORRES, petitioner,
vs.
LEON VENTURA, respondent.
Public Attorney's Office for petitioner.
Melosino Respicio for private respondent.

GANCAYCO, J.:
This nation has a wealth of laws on agrarian reform. Such laws were enacted not
only because of the constitutional mandate regarding the protection to labor and

the promotion of social justice but also because of the realization that there is an
urgent need to do something in order to improve the lives of the vast number of
poor farmers in our land.
Yet, despite such laws, it is a fact that the agrarian problems which beset our nation
have remained unsolved. Majority of our farmers still live a hand-to-mouth
existence. The clamor for change has not died down.
One need not go far in order to search for the reason behind this. We all know that
our beautifully-worded agrarian laws have never really been effectively
implemented. Unscrupulous individuals have found various ways in order to get
around the laws. Loopholes in the law and the ignorance of the poor farmers have
been taken advantage of by them. Consequently, the farmers who are intended to
be protected and uplifted by the said laws find themselves back to where they
started or even in a worse position. We must put a stop to this vicious cycle and the
time to do it is now.
This case serves to remind those who are involved in the execution of agrarian laws
that it is the farmer-beneficiary's interest that must be primarily served. This also
holds that agrarian laws are to be liberally construed in favor of the farmerbeneficiary. Anyone who wishes to contest the rights of the farmer to land given to
him by the government in accordance with our agrarian laws has the burden of
proving that the farmer does not deserve the government grant.
Posed before Us for resolution in this petition for review on certiorari is the question
of to whom ownership and possession of a certain landholding rightfully belongs: to
petitioner who was the tiller of the land when Presidential Decree No. 27 was
promulgated, or to private respondent in whose favor petitioner transferred his
rights over the land in consideration of P5,000.00.
The following facts can be gathered from the records of this case:
Petitioner was the leasehold tenant of a 4,000 square-meter parcel of land included
in the Florencio Firme Estate and located at Caloocan, Cabatuan, Isabela. In 1972,
when Presidential Decree No. 27 was signed into law, petitioner was the tiller of the
aforementioned piece of land and was automatically deemed owner of the property.
Under Presidential Decree No. 27, any form of transfer of those lands within the
coverage of the law is prohibited except as otherwise provided therein.
In 1978, urgently in need of money, petitioner was forced to enter into what is
called a "selda" agreement, with private respondent, wherein he transferred his
rights of possession and enjoyment over the landholding in question to the latter in
consideration of a loan in the amount of P5,000.00 to be paid not earlier than 1980.
As part of the agreement, petitioner signed an "Affidavit of Waiver" whereby he

waived all his rights over the property in favor of private respondent. According to
petitioner, it was also agreed upon by them that upon the payment of the loaned
amount, private respondent will deliver possession and enjoyment of the property
back to petitioner.
Two years later or in 1980, petitioner offered to pay the loaned amount but private
respondent asked for an extension of one more year to continue cultivating the land
and enjoying its fruits. Because of this, the money being offered by petitioner to pay
for the loan was utilized for other purposes. In 1981, though petitioner really wanted
to get the property back, he could not do so because he lacked the necessary funds.
It was only in 1985 when petitioner was able to save enough money to make
another offer but this time private respondent categorically denied said offer and
refused to vacate the land.
Hence, petitioner filed a complaint with the barangay captain of Magsaysay,
Cabatuan, Isabela stating therein that he mortgaged his land to private respondent
and that he already wanted to redeem it. On the scheduled date of hearing, private
respondent failed to appear.
Upon the issuance by the barangay captain of a certificate to file action, petitioner
filed a complaint with the Regional Trial Court of Cauayan, Isabela for the recovery
of possession of the parcel of land in question. After due trial, the said court
rendered a decision in favor of petitioner with the following dispositive portion:
WHEREFORE, in view of the foregoing considerations, judgment is
hereby rendered:
(1) DECLARING the affidavit of waiver (Exh. 1) executed by the plaintiff
waiving his right as a leasehold tenant to the defendant null and void;
(2) ORDERING the defendant, his agents, tenants or any person or
persons acting on his behalf to deliver immediately the possession of
the land in question to the plaintiff;
(3) DECLARING the loan of P5,000.00 received by the plaintiff from the
defendant in 1979 including interest thereon considered paid as of
December 1, 1983;
(4) ORDERING the defendant to pay the plaintiff total damages and in
the amount of P5,200.00 up to December 1, 1986; and
(5) ORDERING the defendant to pay the plaintiff 6 cavans of palay at
50 kilos per planting season from December 1, 1986, or their

equivalent at the NFA price of P3.50 per kilo, until the possession of the
land in question is delivered to the plaintiff. 1
On appeal to the Court of Appeals, the decision of the trial court was
reversed. Hence, this petition for review on certiorari. 2
Taking into consideration the circumstances surrounding this case and bearing in
mind the constitutional mandate on the promotion of agrarian reform, We rule in
favor of petitioner.
It is not disputed by private respondent that petitioner was in fact the tiller of the
subject land when Presidential Decree No. 27 was promulgated in 1972. As a
consequence of the law, petitioner was granted the right to possess and enjoy the
property for himself.
The conflict arose when petitioner, by force of circumstances, transferred
possession of his land to private respondent in consideration of a sum certain. As to
what was actually the contract that was entered upon is being contested by the two
parties herein. Petitioner has insisted from the very beginning that the agreement
entered into between him and private respondent was one of mortgage and that
private respondent promised to give back to him his landholding upon payment of
the loaned amount. The stand of private respondent, on the other hand, is that
petitioner relinquished all his rights over the property in his favor, as expressly
written in the Affidavit of Waiver that petitioner signed.
In its decision, the trial court ruled in favor of petitioner having found his version
more convincing than that of private respondent whose evasive attitude did not go
unnoticed therein. The trial court further ruled that the transfer of property from
petitioner to private respondent is null and void for being violative of Presidential
Decree No. 27. The Court of Appeals, on the other hand, believed that petitioner
completely waived his rights over the land as evidenced by the Affidavit of Waiver
he executed. According to the Court of Appeals, the said Affidavit of Waiver is valid
because at the time of its execution, petitioner was not yet the owner of the land
there having been no title issued to him yet. As such, continued the Court of
Appeals, the Affidavit of Waiver did not violate Presidential Decree No. 27. The Court
of Appeals further added that petitioner abandoned his landholding and received
benefits under the agreement, hence, should not be rewarded at the expense of
private respondent.
After a careful scrutiny of the two conflicting decisions and an exhaustive study of
the laws and jurisprudence applicable to this case, We affirm the judgment of the
trial court. First, of all, We have given much weight to the finding of the trial court
that what was entered upon by the parties herein was a contract of mortgage. It
need not be stressed that in the matter of credibility of witnesses, We rely heavily

on the findings of the trial court because it had the opportunity to meet them face
to face. As the trial court observed, petitioner's version is more convincing because
of the apparent evasive attitude of private respondent as compared to the candid
testimony of the petitioner. 3
Indeed, We find it hard to believe that petitioner, who has been tilling the land in
question for a long, long time would suddenly lose interest in it and decide to leave
it for good at a time when he knew that full ownership over the same was soon
going to be in his hands. Furthermore, if the situation were otherwise, petitioner
would not have made repeated offers to pay for the amount he borrowed from
private respondent and demand from the latter the possession of the land. He
would not have even thought of bringing an action for the recovery of the same if
he honestly believed that he had already given it up in favor of private respondent.
Petitioner, or anyone in his right mind for that matter, would not waste his time,
effort and money, especially if he is poor, to prosecute an unworthy action. If at all,
petitioner is an example of a poor tenant farmer who, due to sheer poverty, was
constrained to mortgage his only land 4 to somebody else 5 situation which
Presidential Decree No. 27 sought to prevent by providing an explicit prohibition on
transfers.
The above finding notwithstanding, and assuming that petitioner really waived his
tenancy rights in favor of private respondent, this case should still be resolved
against private respondent. The transfer would still be void for being made in
violation of Presidential Decree No. 27.
We shall now take a closer look at the law.
Presidential Decree No. 27 was signed into law in view of the fact that the old
concept of land ownership by a few has spawned valid and legitimate grievances
that gave rise to violent conflict and social tension. 6 The law points out that
reformation must start with the emancipation of the tiller from the bondage of the
soil. 7
The fundamental policy of the law is reflected in its title, to wit: PRESIDENTIAL
DECREE NO. 27 DECREEING THE EMANCIPATION OF TENANT FROM THE BONDAGE
OF THE SOIL, TRANSFERRING TO THEM THE OWNERSHIP OF THE LAND THEY TILL
AND PROVIDING THE INSTRUMENTS AND MECHANISM THEREFOR. This policy is
intended to be given effect by the following provisions:
xxx xxx xxx
The tenant farmer, whether in land classified as landed estate or not,
shall be DEEMED OWNER of a portion constituting a family size farm of

five (5) hectares if not irrigated and three (3) hectares if irrigated;
(Emphasis supplied).
xxx xxx xxx
TITLE TO LAND ACQUIRED PURSUANT TO THIS DECREE OR THE LAND
REFORM PROGRAM OF THE GOVERNMENT SHALL NOT BE
TRANSFERABLE except by hereditary succession or to the Government
in accordance with the provisions of this Decree, the Code of Agrarian
Reforms and other existing laws and regulations; (Emphasis supplied).
xxx xxx xxx

The law is clear and leaves no room for doubt. Upon the promulgation of
Presidential Decree No. 27 on October 21, 1972, petitioner was DEEMED OWNER of
the land in question. As of that date, he was declared emancipated from the
bondage of the soil. As such, he gained the rights to possess, cultivate, and enjoy
the landholding for himself. Those rights over that particular property were granted
by the government to him and to no other. To insure his continued possession and
enjoyment of the property, he could not, under the law, make any valid form of
transfer except to the government or by hereditary succession, to his successors.
Yet, it is a fact that despite the prohibition, many farmer-beneficiaries like petitioner
herein were tempted to make use of their land to acquire much needed money.
Hence, the then Ministry of Agrarian Reform issued the following Memorandum
Circular:
Despite the above prohibition, however, there are reports that many
farmer-beneficiaries of PD 27 have transferred the ownership, rights,
and/or possession of their farms/homelots to other persons or have
surrendered the same to their former landowners. All these
transactions/surrenders are violative of PD 27 and therefore, null and
void. 9 (Emphasis supplied.)
We do not agree with the Court of Appeals when it ruled that petitioner's land is not
included in the legal prohibition since petitioner has not yet acquired absolute title
to the land having failed to comply with all the conditions set forth by the law. With
regard to the legal prohibition, We hold that title refers not only to that issued upon
compliance by the tenant-farmer of the said conditions but also includes those
rights and interests that the tenant-farmer immediately acquired upon the
promulgation of the law. To rule otherwise would make a tenant farmer falling in
the category of those who have not yet been issued a formal title to the land they
till easy prey to those who would like to tempt them with cash in exchange for
inchoate title over the same. Following this, absolute title over lands covered by

Presidential Decree No. 27 would end up in the name of persons who were not the
actual tillers when the law was promulgated.
Furthermore, the evidence on hand shows that Certificate of Land Transfer No.
096267 covering the land in question is in the name of petitioner Victorino
Torres. 10 This is admitted by private respondent. 11 In Gloria de Oliver vs. Sisenando
Cruz, et al., 12 the Court of Appeals correctly ruled that:
The rights and interests covered by the Certificate of Land Transfer are
beyond the commerce of man. They are not negotiable except when it
is used by the beneficiary as a collateral for a loan with the rural bank
for an agricultural production.
Having settled that the contract of transfer entered into between petitioner and
private respondent is void ab initio, We now go to the issue of whether or not the
principle of pari delicto 13 applies to this case. We rule in the negative. Public policy
and the policy of the law must prevail. To hold otherwise will defeat the spirit and
intent of Presidential Decree No. 27 and the tillers will never be emancipated from
the bondage of the soil.
In Catalina de los Santos vs. Roman Catholic Church, 14 this Court ruled that the pari
delicto doctrine is not applicable to a homestead which has been illegally sold in
violation of the homestead law. One of the reasons given by this Court for the ruling
is that the policy of the law is to give land to a family for home and cultivation.
In Acierto, et al. vs. De los Santos, et al., 15 where the principle was reiterated, this
Court, through Justice Alex Reyes, made the following pronouncement:
Appellants, however, contend that the voiding provision of the Act may
not be invoked in favor of plaintiffs as their predecessor in interest
was in pari delicto, and that, since the same provision says the illegal
sale shall have the effect of annulling the grant and cause the
reversion of the property and its improvements to the State, plaintiffs
may no longer claim the homestead. Similar contentions were made in
the case of Catalina de los Santos vs. Roman Catholic Church of
Midsayap et al., G.R. No.
L-6088, decided February 25, 1954, but they were there overruled, this
Court holding that the pari delicto doctrine may not be invoked in a
case of this kind since it would run counter to an avowed fundamental
policy of the State, that the forfeiture of the homestead is a matter
between the State and the grantee or his heirs, and that until the State
had taken steps to annul the grant and asserts title to the homestead
the purchaser is, as against the vendor or his heirs "no more entitled to
keep the land than any intruder. 16

The pronouncements in the two above-mentioned cases were adopted by this Court
in Angeles, et al. vs. Court of Appeals, et al., 17 wherein We ruled that the sale of the
homestead by the homesteader is null and void and his heirs have the right to
recover the homestead illegally disposed of.
In view of all the foregoing, We hold that the contract, being void ab initio, must be
given no effect at all. The parties in this case are to be placed in status quo which
was the condition prevailing prior to the execution of the void contract.
WHEREFORE, the Decision of the Court of Appeals in CA-G.R. CV No. 15482 is
REVERSED AND SET ASIDE. The Decision of the Regional Trial Court of Cauayan,
Isabela in Civil Case No. Br. XIX-167 is hereby ordered REINSTATED. Costs against
private respondent.
SO ORDERED.

G.R. No. 103125 May 17, 1993

PROVINCE OF CAMARINES SUR, represented by GOV. LUIS R. VILLAFUERTE
and HON. BENJAMIN V. PANGA as Presiding Judge of RTC Branch 33 at Pili,
Camarines Sur, petitioners,
vs.
THE COURT OF APPEALS (THIRD DIVISION), ERNESTO SAN JOAQUIN and
EFREN SAN JOAQUIN,respondents.
The Provincial Attorney for petitioners.
Reynaldo L. Herrera for Ernesto San Joaquin.

QUIASON, J.:
In this appeal by certiorari from the decision of the Court of Appeals in AC-G.R. SP
No. 20551 entitled "Ernesto N. San Joaquin, et al., v. Hon. Benjamin V. Panga, et al.,"
this Court is asked to decide whether the expropriation of agricultural lands by local
government units is subject, to the prior approval of the Secretary of the Agrarian
Reform, as the implementator of the agrarian reform program.
On December 22, 1988, the Sangguniang Panlalawigan of the Province of Camarines
Sur passed Resolution No. 129, Series of 1988, authorizing the Provincial Governor
to purchase or expropriate property contiguous to the provincial capitol site, in

order to establish a pilot farm for non-food and non-traditional agricultural crops and
a housing project for provincial government employees.
The "WHEREAS" clause o:f the Resolution states:
WHEREAS, the province of Camarines Sur has adopted a five-year
Comprehensive Development plan, some of the vital components of
which includes the establishment of model and pilot farm for non-food
and non-traditional agricultural crops, soil testing and tissue culture
laboratory centers, 15 small scale technology soap making, small scale
products of plaster of paris, marine biological and sea farming research
center,and other progressive feasibility concepts objective of which is
to provide the necessary scientific and technology know-how to
farmers and fishermen in Camarines Sur and to establish a housing
project for provincial government employees;
WHEREAS, the province would need additional land to be acquired
either by purchase or expropriation to implement the above program
component;
WHEREAS, there are contiguous/adjacent properties to be (sic) present
Provincial Capitol Site ideally suitable to establish the same pilot
development center;
WHEREFORE . . . .
Pursuant to the Resolution, the Province of Camarines Sur, through its Governor,
Hon. Luis R.Villafuerte, filed two separate cases for expropriation against Ernesto N.
San Joaquin and Efren N. San Joaquin, docketed as Special Civil Action Nos. P-17-89
and P-19-89 of the Regional Trial Court, Pili, Camarines Sur, presided by the Hon.
Benjamin V. Panga.
Forthwith, the Province of Camarines Sur filed a motion for the issuance of writ of
possession. The San Joaquins failed to appear at the hearing of the motion.
The San Joaquins moved to dismiss the complaints on the ground of inadequacy of
the price offered for their property. In an order dated December 6, 1989, the trial
court denied the motion to dismiss and authorized the Province of Camarines Sur to
take possession of the property upon the deposit with the Clerk of Court of the
amount of P5,714.00, the amount provisionally fixed by the trial court to answer for
damages that private respondents may suffer in the event that the expropriation
cases do not prosper. The trial court issued a writ of possession in an order dated
January18, 1990.

The San Joaquins filed a motion for relief from the order, authorizing the Province of
Camarines Sur to take possession of their property and a motion to admit an
amended motion to dismiss. Both motions were denied in the order dated February
1990.
In their petition before the Court of Appeals, the San Joaquins asked: (a) that
Resolution No. 129, Series of 1988 of the Sangguniang Panlalawigan be declared
null and void; (b) that the complaints for expropriation be dismissed; and (c) that
the order dated December 6, 1989 (i) denying the motion to dismiss and (ii)
allowing the Province of Camarines Sur to take possession of the property subject of
the expropriation and the order dated February 26, 1990, denying the motion to
admit the amended motion to dismiss, be set aside. They also asked that an order
be issued to restrain the trial court from enforcing the writ of possession, and
thereafter to issue a writ of injunction.
In its answer to the petition, the Province of Camarines Sur claimed that it has the
authority to initiate the expropriation proceedings under Sections 4 and 7 of Local
Government Code (B.P. Blg. 337) and that the expropriations are for a public
purpose.
Asked by the Court of Appeals to give his Comment to the petition, the Solicitor
General stated that under Section 9 of the Local Government Code (B.P. Blg. 337),
there was no need for the approval by the Office of the President of the exercise by
the Sangguniang Panlalawigan of the right of eminent domain. However, the
Solicitor General expressed the view that the Province of Camarines Sur must first
secure the approval of the Department of Agrarian Reform of the plan to expropriate
the lands of petitioners for use as a housing project.
The Court of Appeals set aside the order of the trial court, allowing the Province of
Camarines Sur to take possession of private respondents' lands and the order
denying the admission of the amended motion to dismiss. It also ordered the trial
court to suspend the expropriation proceedings until after the Province of Camarines
Sur shall have submitted the requisite approval of the Department of Agrarian
Reform to convert the classification of the property of the private respondents from
agricultural to non-agricultural land.
Hence this petition.
It must be noted that in the Court of Appeals, the San Joaquins asked for: (i) the
dismissal of the complaints for expropriation on the ground of the inadequacy of the
compensation offered for the property and (ii) the nullification of Resolution No. 129,
Series of 1988 of the Sangguniang Panlalawigan of the Province of Camarines Sur.

The Court of Appeals did not rule on the validity of the questioned resolution;
neither did it dismiss the complaints. However, when the Court of Appeals ordered
the suspension of the proceedings until the Province of Camarines Sur shall have
obtained the authority of the Department of Agrarian Reform to change the
classification of the lands sought to be expropriated from agricultural to nonagricultural use, it assumed that the resolution is valid and that the expropriation is
for a public purpose or public use.
Modernly, there has been a shift from the literal to a broader interpretation of
"public purpose" or "public use" for which the power of eminent domain may be
exercised. The old concept was that the condemned property must actually be used
by the general public (e.g. roads, bridges, public plazas, etc.) before the taking
thereof could satisfy the constitutional requirement of "public use". Under the new
concept, "public use" means public advantage, convenience or benefit, which tends
to contribute to the general welfare and the prosperity of the whole community, like
a resort complex for tourists or housing project (Heirs of Juancho Ardano v. Reyes,
125 SCRA 220 [1983]; Sumulong v. Guerrero, 154 SC.RA 461 [1987]).
The expropriation of the property authorized by the questioned resolution is for a
public purpose. The establishment of a pilot development center would inure to the
direct benefit and advantage of the people of the Province of Camarines Sur. Once
operational, the center would make available to the community invaluable
information and technology on agriculture, fishery and the cottage industry.
Ultimately, the livelihood of the farmers, fishermen and craftsmen would be
enhanced. The housing project also satisfies the public purpose requirement of the
Constitution. As held in Sumulong v. Guerrero, 154 SCRA 461, "Housing is a basic
human need. Shortage in housing is a matter of state concern since it directly and
significantly affects public health, safety, the environment and in sum the general
welfare."
It is the submission of the Province of Camarines Sur that its exercise of the power
of eminent domain cannot be restricted by the provisions of the Comprehensive
Agrarian Reform Law (R.A. No. 6657), particularly Section 65 thereof, which requires
the approval of the Department of Agrarian Reform before a parcel of land can be
reclassified from an agricultural to a non-agricultural land.
The Court of Appeals, following the recommendation of the Solicitor General, held
that the Province of Camarines Sur must comply with the provision of Section 65 of
the Comprehensive Agrarian Reform Law and must first secure the approval of the
Department of Agrarian Reform of the plan to expropriate the lands of the San
Joaquins.
In Heirs of Juancho Ardana v. Reyes, 125 SCRA 220, petitioners raised the issue of
whether the Philippine Tourism Authority can expropriate lands covered by the

"Operation Land Transfer" for use of a tourist resort complex. There was a finding
that of the 282 hectares sought to be expropriated, only an area of 8,970 square
meters or less than one hectare was affected by the land reform program and
covered by emancipation patents issued by the Ministry of Agrarian Reform. While
the Court said that there was "no need under the facts of this petition to rule on
whether the public purpose is superior or inferior to another purpose or engage in a
balancing of competing public interest," it upheld the expropriation after noting that
petitioners had failed to overcome the showing that the taking of 8,970 square
meters formed part of the resort complex. A fair and reasonable reading of the
decision is that this Court viewed the power of expropriation as superior to the
power to distribute lands under the land reform program.
The Solicitor General denigrated the power to expropriate by the Province of
Camarines Sur by stressing the fact that local government units exercise such
power only by delegation. (Comment, pp. 14-15; Rollo, pp. 128-129)
It is true that local government units have no inherent power of eminent domain
and can exercise it only when expressly authorized by the legislature (City of
Cincinnati v. Vester, 28l US 439, 74 L.ed. 950, 50 SCt. 360). It is also true that in
delegating the power to expropriate, the legislature may retain certain control or
impose certain restraints on the exercise thereof by the local governments (Joslin
Mfg. Co. v. Providence, 262 US 668 67 L. ed. 1167, 43 S Ct. 684). While such
delegated power may be a limited authority, it is complete within its limits.
Moreover, the limitations on the exercise of the delegated power must be clearly
expressed, either in the law conferring the power or in other legislations.
Resolution No. 129, Series of 1988, was promulgated pursuant to Section 9 of B.P.
Blg. 337, the Local Government Code, which provides:
A local government unit may, through its head and acting pursuant to
a resolution of its sanggunian exercise the right of eminent domain and
institute condemnation proceedings for public use or purpose.
Section 9 of B.P. Blg. 337 does not intimate in the least that local government, units
must first secure the approval of the Department of Land Reform for the conversion
of lands from agricultural to non-agricultural use, before they can institute the
necessary expropriation proceedings. Likewise, there is no provision in the
Comprehensive Agrarian Reform Law which expressly subjects the expropriation of
agricultural lands by local government units to the control of the Department of
Agrarian Reform. The closest provision of law that the Court of Appeals could cite to
justify the intervention of the Department of Agrarian Reform in expropriation
matters is Section 65 of the Comprehensive Agrarian Reform Law, which reads:

Sec. 65. Conversion of Lands. After the lapse of five (5) years from
its award, when the land ceases to be economically feasible and sound
for, agricultural purposes, or the locality has become urbanized and
the land will have a greater economic value for residential, commercial
or industrial purposes, the DAR, upon application of the beneficiary or
the landowner, with due notice to the affected parties, and subject to
existing laws, may authorize the reclassification or conversion of the
land and its disposition: Provided, That the beneficiary shall have fully
paid his obligation.
The opening, adverbial phrase of the provision sends signals that it applies to lands
previously placed under the agrarian reform program as it speaks of "the lapse of
five (5) years from its award."
The rules on conversion of agricultural lands found in Section 4 (k) and 5 (1) of
Executive Order No. 129-A, Series of 1987, cannot be the source of the authority of
the Department of Agrarian Reform to determine the suitability of a parcel of
agricultural land for the purpose to which it would be devoted by the expropriating
authority. While those rules vest on the Department of Agrarian Reform the
exclusive authority to approve or disapprove conversions of agricultural lands for
residential, commercial or industrial uses, such authority is limited to the
applications for reclassification submitted by the land owners or tenant
beneficiaries.
Statutes conferring the power of eminent domain to political subdivisions cannot be
broadened or constricted by implication (Schulman v. People, 10 N.Y. 2d. 249, 176
N.E. 2d. 817, 219 NYS 2d. 241).
To sustain the Court of Appeals would mean that the local government units can no
longer expropriate agricultural lands needed for the construction of roads, bridges,
schools, hospitals, etc, without first applying for conversion of the use of the lands
with the Department of Agrarian Reform, because all of these projects would
naturally involve a change in the land use. In effect, it would then be the
Department of Agrarian Reform to scrutinize whether the expropriation is for a
public purpose or public use.
Ordinarily, it is the legislative branch of the local government unit that shall
determine whether the use of the property sought to be expropriated shall be
public, the same being an expression of legislative policy. The courts defer to such
legislative determination and will intervene only when a particular undertaking has
no real or substantial relation to the public use (United States Ex Rel Tennessee
Valley Authority v. Welch, 327 US 546, 90 L. ed. 843, 66 S Ct 715; State ex rel Twin
City Bldg. and Invest. Co. v. Houghton, 144 Minn. 1, 174 NW 885, 8 ALR 585).

There is also an ancient rule that restrictive statutes, no matter how broad their
terms are, do not embrace the sovereign unless the sovereign is specially
mentioned as subject thereto (Alliance of Government Workers v. Minister of Labor
and Employment, 124 SCRA 1 [1983]). The Republic of the Philippines, as sovereign,
or its political subdivisions, as holders of delegated sovereign powers, cannot be
bound by provisions of law couched in general term.
The fears of private respondents that they will be paid on the basis of the valuation
declared in the tax declarations of their property, are unfounded. This Court has
declared as unconstitutional the Presidential Decrees fixing the just compensation in
expropriation cases to be the value given to the condemned property either by the
owners or the assessor, whichever was lower ([Export Processing Zone Authority v.
Dulay, 149 SCRA 305 [1987]). As held in Municipality of Talisay v. Ramirez, 183
SCRA 528 [1990], the rules for determining just compensation are those laid down
in Rule 67 of the Rules of Court, which allow private respondents to submit evidence
on what they consider shall be the just compensation for their property.
WHEREFORE, the petition is GRANTED and the questioned decision of the Court of
Appeals is set aside insofar as it (a) nullifies the trial court's order allowing the
Province of Camarines Sur to take possession of private respondents' property; (b)
orders the trial court to suspend the expropriation proceedings; and (c) requires the
Province of Camarines Sur to obtain the approval of the Department of Agrarian
Reform to convert or reclassify private respondents' property from agricultural to
non-agricultural use.
The decision of the Court of Appeals is AFFIRMED insofar as it sets aside the order of
the trial court, denying the amended motion to dismiss of the private respondents.
SO ORDERED