SOCIAL LEGISLATION CASES

Fe n. Sulit, petitioner,
V. Employees compensation commission and government service insurance
system (cavite naval shipyard naval shore establishment), respondents.
[g.r. No. L-48602. June 30, 1980.]

Facts:
This is a claim for employees compensation. Gregorio s. Sulit was employed as a
mechanic in the cavite naval shipyard, cavite naval base of the philippine navy. His dutie is
to repair and service other mechanical accessories on board pn vessels and may perform
other duties as directed. Due to persistent backaches and bilateral lumbar pains,
accompanied by fever and chills, he was confined in the philippine general hospital. He died
of acute pyelonephritis and bronchopneumonia.
Fe n. Sulit, the widow of the deceased mechanic, filed a claim for employees
compensation under presidential decree no. 626. She contended that her husbands work
was postural in nature and time consuming and that his repairing of a motor vehicle while in
a prone position under it for long perspiring hours daily in the span of his working career
produced a kinking of his ureters, thereby causing a constant and progressive stagnancy of
urine flow which led to infection in the urinary tract and stone formation therein.
The government service insurance system and the employees compensation
commission rejected the claim because pyelonephritis and bronchopneumonia are not
occupational diseases since they do not usually and directly result from the occupation or
profession of the worker. Furthermore, the risks of contracting such diseases were not
increased by the working conditions concomitant with the decedents employment.
Issue:
Whether or not mrs. Sulit can claim for employees compensation under presidential
decree no. 626.
Held:
No. Article 166 of the labor code provides that "the state shall promote and develop a
tax-exempt employees compensation program whereby employees and their dependents,
in the event of work-connected disability or death, may promptly secure adequate income
benefit, and medical or related benefits." pyelonephritis was not caused by her husbands
work as a mechanic. The contracting of such a disease was not increased by the working
conditions of his job. Hence, that disease is not compensable in this case. The same
observations apply to bronchopneumonia.
Carmen santos, petitioner
vs.
Employees' compensation commission and government service insurance system
(philippine navy), respondents
[G.r. No. 89222. April 7, 1993.]
Facts:
Francisco santos was employed as welder at the philippine navy and its naval
shipyard. He spent the last 32 years of his life in the government service, the first year as a
welder helper and the last two years as shipyard assistant.francisco was admitted at the
naval station hospital in cavite city, his case was diagnosed as bleeding peptic ulcer disease
(pud), cholelithiasis and diabetes mellitus. On january 11, 1987, he died, the cause of which
as indicated in the death certificate was liver cirrhosis.
Mrs. Carmen a. Santos filed a claim for the death benefit of her husband, francisco,
pursuant to presidential decree no. 626, as amended. However, the government service
insurance system (gsis), denied the claim on the ground that upon proofs and evidence
submitted, francisco's ailment cannot be considered an occupational disease as
contemplated under p.d. 626, as amended.mrs. Santos then sought the assistance of the
commander of nascom, pn, who in turn wrote the gsis requesting for a favorable action on
her claim.
On appeal to the employees' compensation commission (ecc), the commission
affirmed the denial of the gsis on petitioner's claim relying on the fact that the diagnosis on
francisco's illness did not specify the type of cirrhosis which caused his death.
Issue:
Whether or not petitioner can still claim when an illness is not listed in the table
occupational diseases.
Held:
Yes. As a welder, francisco was exposed to heat, gas fumes and chemical substances
coming from the burning electrodes caused by welding. These are industrial hazards to
which francisco was exposed. And in the long course of time, 32 years at that, his
continuous exposure to burned electrodes and chemicals emitted therefrom would likely
cause poisoning and malfunction of the liver.
The policy is to extend the applicability of pd 626 to a greater number of employees
who can avail of the benefits under the law, which is in consonance with the avowed policy
of the state to give maximum aid and protection to labor. Liver cirrhosis, although not one
among those listed as compensable ailment, as considered in the case at bar as covered
under the act, on the ground that the nature of the work of petitioner's husband, exposed
him to the risk of contracting the same.
Luz latagan, petitioner, v. Employees compensation commission & government
service insurance system (philippine navy), respondents.
[g.r. No. 55741. September 11, 1992.]
Facts:
Petitioner, a pauper litigant, seeks compensation benefits under p.d. 626 for the
death of her husband, t/sgt. Josue a. Latagan, who was employed in the philippine navy from
1949 up to the time he died in 1978. She claims that his fatal ailment known as
bronchogenic carcinoma was caused by his employment, and that the risk of contracting the
disease was aggravated by the working conditions attendant to his duties as gunnersmate in
the philippine navy.
Josue a. Latagan who was admitted for the first time because of chest pains started 3
months prior to admission. Where patient expired after almost 2 years of stay in the
hospital. Subsequently, josues wife filed a claim for death benefits with the survivorship
benefits department, government service insurance system (gsis). Gsis denied her claim,
and on 15 december 1978 her motion for reconsideration. On 27 september 1979,
respondent employees compensation commission (ecc), in ecc case no. 1221, rendered a
decision on appeal 3 affirming the denial by gsis, ecc find no reason to reverse the decision
of the respondent system. When the illness is admittedly not an occupational disease, the
law requires proof that the risk of contracting the illness is increased by the working
conditions. As already ruled by the respondent system, substantial evidence must show that
the development of the ailment which caused the death of appellants husband was brought
about largely by the conditions present in the decedents employment. Cralaw virtua1aw
library

Issue:
Whether or not respondent is meritorious on saying that the fatal ailment was not an
occupational disease, hence, not compensable.
Held:
Yes. Contrary to petitioners assertion, the cause of her husbands death,
bronchogenic carcinoma, is not an occupational disease. Her reliance on avendao, where
cancer of the lungs was listed as occupational disease, is misplaced because lung cancer, as
shown in the list therein, is occupational only in respect to "vinyl chloride workers" and
"plastic workers." a careful review of the records show that petitioner did not present any
evidence to establish work connection. She relied solely on the theory of aggravation and
presumption of compensability under the old compensation law. In the absence of proof, and
none appears on record, we cannot conclude that the employment of the decedent
increased the risk of his contracting the disease, bronchogenic carcinoma.
PHILIPPINE BLOOMING MILLS VS SSS

facts:

this suit is brought by the employer, pbmco. inc. and its alien employees against sss. PBMC
is a domestic corporation since 1957 which has employed japanese technicians for
employment contracts ranging from 6-24 months from april 28, 1957 t october 26, 1958. it
employed six japanese technicians. PBMC inquired with sss if the said aliens are subject to
compulsory coverage under sss, to which the latter replied that while they are compulsory
covered, they are entitled to rebate a proportionate amount of their sss contribution. their
employer shall also be entitled the same.
However, when PBMC filed a claim with sss for refund, sss controverted it by saying at least
2 years of membership in the system s required to be entitled to a rebate. this requirement
was made through an amendment of the sss rules and regulations which became effective
on jan. 14,
1958 before the termination of the employment of the subject aliens appellants contend that
this amendment impaired their contract with sss.

issue:
whether or not the said amendment violated the non impairment clause
whether due process was observed in implementing the sss law resulting in the denial of
appellants claim for refund.

held: no, there was no violation of the non-impairment cause. Invoking the non-impairment
clause assumes the existence of a contract, which is not the case here. membership in sss is
not the result of bilateral, consensual agreement where the rights and obligations of the
parties are defined by and subject to their will. ra 1161 requires compulsory coverage of
employers and employees, designed to provide social security to the workingmen.
membership in the sss is therefore, in compliance with a lawful exercises of the police power
of the state, to which the principle of nonimpairment of the obligation of contract is not a
proper defense.

yes, due process was observed. amendments are effective from the time provided for by the
statute, which in this case is the time of approval of the president. the date of publication in
the
official gazette is material only when the statute does not provide a specific date of
effectivity. rule
1 sec 3 (d) and rule ix was ammended. (read) - in the present case, the original rules and
regulations of the sss specificallyprovide that any amendment thereto subsequently adopted
by the
commission, shall take effect on the date of its approval by the president. consequently, the
delayed publication of the amended rules in the go did not affect the date of their effectivity,
which
is jan 14, 1958, when their were approved by the president. it follows that when the
japanese
technicians were separated from employment in october, 1958 the rule governing refund of
premiums is rule ix of the amended rules and regulation, which requires for a 2 year
membership
before legibility for it.
BEN STA. RITA , petitioner, vs. THE COURT OF APPEALS, THE
PEOPLE OF THE PHILIPPINES and THE SOCIAL SECURITY
SYSTEM, respondents.
Facts:
Sta. Rita was charged for violating the provisions of the Social Security Law. It was alleged
that he
was a President/General manager of B. Sta. Rita Co., Inc. a compulsorily covered employer
under
the Social Security Law, as amended, did then and there wilfully and unlawfully fail, neglect
and
refuse and still fails, neglects and refuses to remit to the Social Security System
contributions for
SSS, Medicare and Employees Compensation for its covered employees." Petitioner Sta. Rita
moved to dismiss said criminal case alleging that the facts charged do not constitute an
o_ense
and that the RTC has no jurisdiction over the case.
WHY CRIMINAL? WHAT WAS THE BASIS OF THE CRIMINAL ASIDE FROM ESTAFA WHEN IT
IS NOT REMITTED? criminal liability for violation of Section 22 (a) and (b) in relation to
Section 28
(e) of RA 1161, as amended. Section 28 being the PENAL CLAUSE of the said law (e)
Whoever
fails or refuses to comply with the provisions of this Act or with the rules and regulations
promulgated by the Commission, shall be punished by a ?ne of not less than Five thousand
pesos
(P5,000 nor more than Twenty thousand pesos (P20,000), or imprisonment for not less than
six
(6) years and one (1) day nor more than twelve (12) years or both, at the discretion of the
court:
Provided, That where the violation consists in failure or refusal to register employees or
himself,
in case of the covered self-employed, or to deduct contributions from the employees'
compensation and remit the same to the SSS, the penalty shall be a _ne of not less than Five
thousand pesos (P5,000) nor more than Twenty thousand pesos (P20,000) and imprisonment
for
not less than six (6) years and one (1) day nor more than twelve (12) years.
The RTC sustained petitioners motion and dismiss the criminal case. It ruled that the
Memorandum of Agreement entered into between the Department of Labor and
Employment
("DOLE") and the Social Security System ("SSS") extending the coverage of Social Security,
Medical Care and Employment Compensation laws to Filipino seafarers on board foreign
vessels
was null and void as it was entered into by the Administrator of the SSS without the sanction
of the
Commission and approval of the President of the Philippines, in contravention of Section 4(a)
of
R.A. No. 1161, as amended. However, the people, through the OSG, _led in the CA a petition
for
certiorari assailing the order of dismissal by the trial court. Respondent CA granted the
petition and
ordered the reinstatement of the criminal case.
In the Petition for Review, petitioner Sta. Rita contends that the Filipino seafarers recruited
by B.
Sta. Rita Co. and deployed on board foreign vessels outside the Philippines are exempt from
the
coverage of R.A. No. 1161 under Section 8 (j) (5) thereof:
"Terms Defned: EMPLOYMENT Any service performed by an employee for his employer,
except
(5) Service performed on or in connection with an alien vessel by an employee if he is
employed
when such vessel is outside the Philippines
Issue:
Whether or not Filipino seafarers on board vessels are exempted from the SSS Law
Ruling:
No. What the Memorandum of Agreement did was to record the understanding between the
SSS
on the one hand and the DOLE on the other hand that the latter would include among the
provisions of the Standard Contract of Employment required in case of overseas
employment, a
stipulation providing for coverage of the Filipino seafarer by the SSS. The Memorandum of
Agreement is not an implementing rule or regulation of the Social Security Commission
which is subject to the approval of the President. Indeed, as a matter of strict law, the
participation
of the SSS in the establishment by the DOLE of a uniform stipulation in the Standard
Contract of
Employment for Filipino seafarers was not necessary; the Memorandum of Agreement
related
simply to the administrative convenience of the two (2) agencies of government. The Court
finds
no merit in petitioner's contention that Section 8 (j) (5) of R.A. No. 1161, as amended,
absolutely
exempts Filipino seafarers on board foreign vessels from the coverage of the SSS statute.
Section
8 (j) (5) simply defnes the term "employment" and does not in any way relate to the scope
of
coverage of the Social Security System. That
coverage is, upon the other hand, set out in Section 9 of R.A. No. 1161 as amended, which
defnes
the scope of SSS coverage in the following terms:
"SECTION 9. Compulsory Coverage. (a) Coverage in the SSS shall be compulsory upon all
employees not over sixty years of age and their employers; Provided, . . . (b) Filipinos
recruited in
the Philippines by foreign-based employers for employment abroad may be covered by the
SSS on
a voluntary basis. (The SSS law coverage is written into the contract) The extension of the
coverage of the Social Security System to Filipino seafarers arises by virtue of the assent
given in
the contract of employment signed by employer and seafarer; that same contract binds
petitioner
Sta. Rita or B. Sta. Rita Company, who is solidarily liable with the foreign
shipowners/employers. It
is, Finally, worthy of special note that by extending the benefits of the Social Security Act to
Filipino
seafarers on board foreign vessels, the individual employment agreements entered into with
the
stipulation for such coverage contemplated in the DOLE-SSS Memorandum of Agreement,
merely
give effect to the constitutional mandate to the State to afford protection to labor whether
"local or
overseas. " Nullification of the SSS stipulation in those individual employment contracts,
through
nullification of the Memorandum of Agreement, constituted serious reversible error on the
part of
the trial court. That petitioner should seek to deprive his countrymen of social security
protection
after his foreign principal had agreed to such protection, is cause for dismay and is to be
deplored.
CORPORAL SR. VS. NLRC
341 SCRA 658
[G.R. No. 129315. October 2, 2000]
Facts: 5 male barbers and 2 female manicurists (Petitioners) worked at New Look
Barbershop, a sole proprietorship owned and managed by Vicente Lao which in 1982 was
taken over by Lao Enteng Co., Inc., (respondent corporation) a corporation formed by
Vicente Laos children. The petitioners were allowed to work there until April 1985 when they
were told that the barbershop building was sold and their services are no longer needed.

Petitioners filed with the Arbitration branch of NLRC a complaint for illegal dismissal, illegal
deduction, separation pay, non-payment of 13th month pay and salary differential. Also they
seek for refund of P1.00 collected from each of them daily as salary of the barbershops
sweeper.

Respondent Corporation alleged that petitioners were Joint Venture (JV) partners receiving
50% commission (Petitioners admitted in receiving 50-60%), therefore no employer-
employee relationship existed. And assuming arguendo that employer-employee relationship
existed, petitioners were not entitled to separation pay since cessation of the business was
due to serious business losses. Also, they allege that the barbershop had always been a JV
partnership with the operation and management left entirely to petitioners and that the
former had no control over the latter who could freely come and go as they wish. Lastly,
they allege that some of the petitioners were allowed to register in SSS only as an act of
accommodation.

The Labor Arbiter dismissed the complaint and found that there was a JV and no employer-
employee relationship. Also that the business was closed due to serious business losses or
financial reverses and the law does not compel the establishment to pay separation pay to
whoever were its employees. On appeal, NLRC affirmed the decision but held that petitioners
were considered independent contractors and not employees. The MR was also denied by
NLRC, hence, this petition on certiorari.

Issue: WON there was an employer-employee relationship.

Held: YES. Petitioners are employees of Respondent Corporation and shall be accorded the
benefits given in Art. 283 of the Labor Code granting separation pay equivalent to 1 month
pay for every year of service and also to 13th month pay. The other claims of petitioners are
found to be without basis.
No documentary evidence of the existence of JV other than the self-serving affidavit
of the company president.
The power of control in the 4-fold test (employer-employee relationship) refers to the
EXISTENCE and NOT THE EXERCISE of such power the following elements must be present
for an employer-employee relationship to exist: (1) the selection and engagement of the
workers; (2) power of dismissal; (3) the payment of wages by whatever means; and (4) the
power to control the worker's conduct, with the latter assuming primacy in the overall
consideration.

The records show that Vicente Lao engaged the petitioners to work for the barbershop and
retained them after it was taken over by the respondent corporation who continuously paid
their wages. Also, the fact that the petitioners worked in the barbershop owned and
operated by respondents, and that they were required to report daily, observing definite
hours of work, they were not free to accept employment elsewhere and devoted their full
time working in the barbershop proves the existence of the power of control.

The petitioners are not independent contractors. An independent contractor is one

who undertakes "job contracting", i.e., a person who (a) carries on an independent business
and undertakes the contract work on his own account under his own responsibility according
to his own manner and method, free from the control and direction of his employer or
principal in all matters connected with the performance of the work except as to the results
thereof, and (b) has substantial capital or investment in the form of tools, equipment,
machineries, work premises, and other materials which are necessary in the conduct of the
business. Petitioners have neither of the above since the tools used such as scissors, razors,
nail cutters, polishes, etc. cannot be considered substantial capital or investment.
While it is no longer true that membership to SSS is predicated on the existence of an
employee-employer relationship since the policy is now to encourage even the self-
employed dressmakers, manicurists and jeepney drivers to become SSS members, we could
not agree with private respondents that petitioners were registered with the Social Security
System as their employees only as an accommodation. As we have earlier mentioned
private respondent showed no proof to their claim that petitioners were the ones who solely
paid all SSS contributions. It is unlikely that respondents would report certain persons as
their workers, pay their SSS premium as well as their wages if it were not true that they were
indeed their employee.
G.R. No. 125837
Chua vs CA

FACTS:

A petition for review of the decision of the Court of Appeals affirming the Order of the
Social Security Commission which held that the private respondents in this case were
regular employees of the petitioner and ordered him to pay SSS for its unpaid
contributions, as well as penalty for the delayed remittance.

Respondents (Andres Paguio, Pablo Canale, Ruel Pangan, Aurelio Paguio, Rolando Trinidad,
Romeo Tapang and Carlos Maliwat) filed a petition with the SSC for SSS coverage and
contributions against Reynaldo Chua (owner of Prime Mover Construction Development)
claiming that they were all regular employees of Chua.

- They alleged that Chua dismissed all of them without justifiable cause and without
notice.

The petitioner contends that the respondents were project employees and that such
employees were not entitled to coverage under Social Security Act.

SSC declared that the respondents are regular employees of Chua, and that the
respondents are covered under SSS. Chua appealed to CA, but the CA affirmed the
decision of the SSC that the respondents were all regular employees since the various
projects of employment lasted for at least one year and that their work was necessary and
desirable to the petitioners business.

ISSUE:

W/N the respondents are regular employees of the petitioner

HELD:

The SC reaffirmed the decision of CA.The private respondents were Chuas regular
employees. Such relationship can be easily determined by the application of the control
test and such will hold true that they were his regular employees since he had control over
the results of the work done, as well as the means and methods by which the same were
accomplished. Chua cannot claim that the respondents were merely project employees.

It is not enough that an employee is hired for a specific project or phase of work, there must
also be a determination of, or a clear agreement on, the completion or termination of the
project at the time the employee was engaged if the objectives of Article 280 of the Labor
Code are to be achieved. Chuadid not able to show that the private respondents were
appraised of the nature of their employment, the specific projects themselves or any phase
thereof undertaken by him and for which private respondents were hired, thus he failed to
substantially give evidence that the private respondents were his projects employee only.
GR. No L-21448
Poblete Construction Co., vs Asiain

FACTS:

Miguel Asiain was an employee of the Poblete Construction Company from 1956 until his
death on November 22, 1959, with a monthly salary of P300. Upon his death, his wife,
Judith Asiainfiled a petition before the Social Security Commission against the company
and its manager, Domingo Poblete to recover the sum of:

1. P3,600.00 equivalent to one year's salary of the deceased,

2. P600.00 representing his unpaid salary for two months,
3. P288.00"representing the cash received by respondents from their laborers as
contribution to the family of the deceased;"
4. P2,000.00 by way of attorney's fees.

The respondents moved to dismiss the petition on the grounds that the Social Security
Commission had no jurisdiction and Judith Asiain had no capacity to sue. The claim must
be filed in an ordinary court.

The Commission denied the motion to dismiss and ordered the respondents to file
their answer.

In its resolution of September 15, 1960 the Commission declared itself without jurisdiction
to entertain the claims in the petition except the one for the sum of P3,600, which it
awarded on the basis of the evidence adduced at the hearing and pursuant to Section 24
of Republic Act No. 1161.

A subsequent motion for reconsideration filed by the respondents was denied, and they
elevated the case for review by the Court of Appeals, which upon proper application issued
a writ of preliminary injunction to stop all further proceedings below, including execution of
the award.

ISSUE:

W/N the Social Security Commission has jurisdiction over the matter

HELD:

This claim was filed under Section 24 of the Social Security Act (R.A. 1191 as amended),
which provides:

Sec. 24. Employment records and reports.(a) Each employer shall report
immediately to the System the names, ages, civil status, occupations, salaries and
dependents of all his employees who are in his employ and who are or may later be
subject to compulsory coverage: Provided, That if an employee subject to
compulsory coverage should die or become sick or disabled without the System
having previously received a report about him from his employer, the said employer
shall pay to the employee or his legal heirs damages equivalent to the benefits to
which said employee would have been entitled had his name been reported on time
by the employer to the System.

Although the deceased, Miguel Asiainhad accomplished SSS Form E-1 and transmitted the
same to the said company's Manila Office, it was never filed with the Social Security System
for the reason, according to the company, he refused to have his share of the corresponding
monthly contributions deducted from his salary. Upon these facts the company maintains
that the deceased was not a member of the System when he died and hence the
adjudication of the claim for damages under Section 24, does not pertain to the Commission
but to the courts of justice.

There is no question that the deceased Miguel Asiain was subject to compulsory coverage in
the Social Security System. It was the duty of the employer to "report immediately to the
System" his name, age, civil status, occupation, salary and dependents. Compliance with
this duty did not depend upon the employee's willingness to give his share of the
contribution. Section 24 is mandatory, to such an extent that if the employee
should die or become sick or disabled without the report having been made by the
employer, the latter is liable for an amount equivalent to the benefits to which the
employee would have been entitled had such report been made. It is true that the
provision uses the word "damages" in referring to the amount that may be claimed. But this
fact alone does not mean that the Social Security Commission lacks jurisdiction to award the
same. Section 5(a) of the Social Security Act provides that "the filing,
determination and settlement of claims shall be governed by the rules and
regulations promulgated by the Commission;" and the rules and regulations thus
promulgated state that "the effectivity of membership in the System, as well as the final
determination and settlement of claims, shall be vested in the Commission." The term
"claims" is broad enough to include a claim for "damages" under Section 24. Otherwise an
employer could nullify the jurisdiction of the Commission by the simple expedient of not
making a report as required by said Section. The collection of the employee's share is a
duty imposed by law, and his unwillingness to have it deducted from his salary
does not excuse the employer's failure to make the report aforesaid.
G.R. No. L-26298
CMS Estate, Inc vs SSS and SSC

FACTS:

Petitioner is a domestic corporation organized primarily for the purpose of engaging in real
estate business. On December 1, 1952, it started doing businesswith only six (6)
employees.- January 28, 1957: petitioner entered into a contract of management with one
Eufracio D. Rojas for the operation and exploitation of the forest concession. Thelogging
operation actually started on April 1, 1957 with four monthly-salaried employees.

September 1, 1957, petitioner had 89 employees and laborersin the logging operation.

December 26, 1957: petitioner revoked its contract of management with Mr. Rojas.

August 1, 1958: petitioner became a member of the Social Security System with respect to
its real estate business.

On September 6, 1958:petitionerremitted to the System the sum of P203.13 representing

theinitial premium on the monthly salaries of the employees in its logging business.

October 9, 1958: petitioner demanded the refund of the said amount.

On November 10, 1958: petitioner filed a petition with the Social Security Commission
praying for the determination of the effectivity date of the compulsorycoverage of
petitioner's logging business.

January 14, 1960: the instant petition was denied and petitioner was adjudged to be
subject to compulsory coverage as Sept. 1, 1957 and the Social SecuritySystem was
directed to effect such coverage of petitioner's employees in its logging and real estate
business conformably to the provisions of Rep. Act No. 1161,as amended.

Petitioners Claim

CMS Estate, Inc. is not yet subject to compulsory coverage with respect to its logging
business because it does not have the minimum required number ofemployees (per
company).

Respondents Comments

The logging business was a mere expansion of petitioner's activities and for purposes of the
Social Security Act, petitioner should be considered a member of theSystem since December
1, 1952 when it commenced its real estate business.

ISSUES:

1. W/N the contributions required of employers and employees under the Social Security
Act of 1954 are obligatory because the said Act was allegedly enactedby Congress in the
exercise of the police power of the State, not of its taxing power

2. W/N a contractee-independent contractor relationship existed between petitioner and

Eufracio Rojas. during the time that he was operating its forestconcession at Baganga,
Davao
3. WON Section 9 of the Social Security Act on the question of compulsory membership and
employers should be given a liberal interpretation
HELD

1 The said enactment implements the general welfare mandate of the Constitution
andconstitutes a legitimate exercise of the police power of theState.

The Social Security Law was enacted pursuant to the policy of the government to
develop, establish gradually and perfect a social security system whichshall be
suitable to the needs of the people throughout the Philippines, and shall provide
protection against the hazards of disability, sickness, oldage and death" (Sec. 2,
RA 1161, as amended).- Membership in the SSS isnot a result of bilateral, consensual
agreement where the rights and obligations of the parties are defined by and
subject totheir will, RA 1161 requires compulsory coverage of employees and employers
under the System. It is actually a legal imposition on said employers andemployees,
designed to provide social security to the workingmen. The principle of non-impairment of
the obligation of contract as provided in the Bill of Rights isnot a proper defense, the
enactment being a lawful exercise of the police power of the State.- The taxing power of
the State is exercised for the purpose of raising revenues.

However, under our Social Security Law, theemphasis is more on thepromotion of the
general welfare. The Act is not part of out Internal Revenue Code nor are the
contributions and premiums therein dealt with and provided forcollectible by the Bureau of
Internal Revenue. The funds contributed to the System belong to the members who will
receive benefits, as a matter of right,whenever the hazards provided by the law occur.-
Together with the contributions imposed upon employees and the Government, they are
intended for the protection of said employees against the hazards ofdisability, sickness,
old age and death in line with the constitutional mandate to promote social justice to
insure the well-being and economic security of all thepeople.

3. Rojas was not an independent contractor but merely an employee of the petitioner. He
was appointed as operations manager of the logging concession; he has no power to
appoint or hire employees; as the term implies, he only managesthe employees and it is
the petitioner who furnishes him the necessary equipment for use in the logging
business; and he is not free from the control and direction ofhis employer in matter
connected with the performance of his work. Rojas should be entitled to the compulsory
coverage of the Act.

4. Because of the broad social purpose of the Social Security Act, all doubts in construing
the Act should favor coverage rather than exemption. Prior to its amendment, Sec. 9 of
the Act provides that before an employer could be compelled to become a member of
the System, he must have been inoperation for at least two years and has at the time of
admission at least six employees.It should be pointed out that it is the employer,
either natural, or judicial person, who is subject to compulsory coverage and
not the business.
 Employees CompensationCommission
vs
Sanico
GR.No. 134028 ; December 17, 1999
Facts:
Petitioner, Employees Compensation Commission seeks to set aside the decision of CA,
reversing petioners decision and granting Sanico, respondents claim for compensation
benefits.
Private respondent was a former wood filer in a private company from 1986 until he was
separated from employment on 31 December 1991 due to his illness. His medical evaluation
report, dated 31 September 1991, showed that he was suffering from pulmonary
tuberculosis (PTB).
On 9 November 1994, private respondent filed with the SSS a claim for compensation
benefits under PD No. 626, as amended. The SSS denied private respondent claimed on the
ground of prescription. The SSS ruled that under Article 201 of the Labor Code, a claim for
compensation shall be given due course only when the same is filed with the system three
(3) years for the time the cause of action accrued. In private respondent case, the SSS
reckoned the three-year prescriptive period on 21 September 1991 when his PTB first
became manifest. When he filed his claimed on 9 November 1974, the claim had allegedly
already prescribed.
Issue:
Whether or not private respondent claim for compensation benefit had already prescribed
when he filed his claim on 9 November 1994.
Ruling:
No. Respondent claim for compensation benefit has not yet prescribed when he filed his it.
Under Article 201 of the Labor Code, filing of compensation claims should reckoned from the
time the employee lost his earning capacity, i.e. terminated from employment, due to his
illness and not when the same first became manifest. Indeed, a person disability might not
emerge at one precise moment in time but rather over a period of time. In this case, private
respondent employment was terminated on 31 December 1991 due to his illness, he filed his
claim for compensation benefits on 9 November 1994.
Accordingly, the private respondent claim was filed within the three-year prescriptive period
under Art. 201 of the Labor Code.

The Court consistently ruled that disability should not be understood more on its medical
significance but on the loss of earning capacity.
In disability compensation, it is not the injury which is compensated, but rather it is the
incapacity to work resulting in the impairment of ones earning capacity.
 SSS vs CA

[G.R. No. 152058. September 27, 2004]

FACTS:

This is a petition for the review of the decisionof CA granting respondent Rago request
to convert his monthly pension from permanent partial disability to permanent total
disability.

Private respondent,Rago worked as an electrician while working on the ceiling of a

building, he fell into the corridor twelve feet below. The x-rays taken revealed that he had a
(1) marked compression fracture of L1 vertebra without signs of dislocation and bone
destruction; and (2) slight kyphosis at the level of L1 vertebrae, with the alignment of the
spine still normal.He was confined in the hospital for 24 daysand thereafter confined in his
housefor 8 months.

Rago filed a claim for permanent partial disability and to convert his SSS disability with
the EC disability with the SSS-Cebu and was approved.

He then filed a claim for Employees Compensation sickness benefit, which was approved
for a maximum of 120 days. And two years later he claimed for the extension of his EC
partial disability and was granted.

Thereafter, Rago filed several requests for the adjustment of his partial disability to total
disability. This time, his requests were denied by the SSS-Cebu. The denial was based on the
medical findings of the Cebu City office that he was not totally prevented from engaging in
any gainful occupation.

When Rago filed with the SSC a petition for total permanent disability benefits, it was
denied for lack of merit. The SSC ruled that he was not entitled to permanent partial
disability more than what was already granted, more so to permanent total disability
benefits since he was already granted the maximum allowable benefit for his injury.

Without filing a motion for reconsideration, Ragoappealed to the CA by filing a petition

for review and reiterating his claim for permanent disability benefits under Section 13-A (g)
of R.A. No. 1161, as amended by R.A. No. 8282. CA reversed the SSC resolution.

The petitioners assert that the CA erred in disregarding the established jurisprudence
that the filing of a motion for reconsideration is a prerequisite to the filing of a petition for
review to enable the tribunal, board or office concerned to pass upon and correct its
mistakes without the intervention of the higher court. Failure to do so is a fatal procedural
defect.

ISSUES:
 (1)Whether or not motion for reconsideration with the SSC, is mandatory, before filing a
petition for review with the Court of Appeals;

(2) Whether or not Rago is entitled of permanent total disability.

RULING:

1. Rago had the option to file a motion for reconsideration before the SSC, it
was nevertheless mandatory that he do so if he wanted to subsequently
avail of judicial remedies.

A combined reading of Section 5 of Rule VI and Section 1 of Rule VII of the SSCs 1997
Revised Rules of Procedure reveals that the petitioners are correct in asserting that a motion
for reconsideration is mandatory in the sense that it is a precondition to the institution of an
appeal or a petition for review before the Court of Appeals. Stated differently, this rule is
explicit in Rule 43 of the Rules of Court, which provides that appeal shall be taken within 15
days from notice of the award, judgment, final order or resolution, or from the date of its last
publication, if publication is required by law for its effectivity, or of the denial of petitioners
motion for new trial or reconsideration duly filed in accordance with the governing law of the
court or agency a quo. Only one (1) motion for reconsideration shall be allowed.Rago has an
option to file his appeal in the court.

However, the court are not unmindful of the doctrine that the principle of exhaustion of
administrative remedies is not an ironclad rule. It may be disregarded. Nevertheless, to
require Rago to comply with the principle of exhaustion of administrative remedies at this
stage of the proceedings would be unreasonable, unjust and inequitable. It would prolong
needlessly and uselessly the resolution of his claim.

2. Rago is entitled to permanent total disability benefits.

The CA correctly observed that Ragos injury made him unable to perform any gainful
occupation for a continuous period exceeding 120 days. The SSS had granted Rago sickness
benefit for 120 days and, thereafter, permanent partial disability for 38 months. Such grant
is an apparent recognition by the SSS that his injury is permanent and total. This is in
conformity with Section 2 (b), Rule VII of the Amended Rules on Employees Compensation
which defines a disability to be total and permanent if, as a result of the injury or sickness,
the employee is unable to perform any gainful occupation for a continuous period exceeding
120 days, and Section 1, b (1) of Rule XI of the same Amended Rules which provides that a
temporary total disability lasting continuously for more than 120 days, shall be considered
permanent.
 Employees CompensationCommission
vs
Sanico
GR.No. 134028 ; December 17, 1999
Facts:
Petitioner, Employees Compensation Commission seeks to set aside the decision of CA,
reversing petioners decision and granting Sanico, respondents claim for compensation
benefits.
Private respondent was a former wood filer in a private company from 1986 until he was
separated from employment on 31 December 1991 due to his illness. His medical evaluation
report, dated 31 September 1991, showed that he was suffering from pulmonary
tuberculosis (PTB).
On 9 November 1994, private respondent filed with the SSS a claim for compensation
benefits under PD No. 626, as amended. The SSS denied private respondent claimed on the
ground of prescription. The SSS ruled that under Article 201 of the Labor Code, a claim for
compensation shall be given due course only when the same is filed with the system three
(3) years for the time the cause of action accrued. In private respondent case, the SSS
reckoned the three-year prescriptive period on 21 September 1991 when his PTB first
became manifest. When he filed his claimed on 9 November 1974, the claim had allegedly
already prescribed.
Issue:
Whether or not private respondent claim for compensation benefit had already prescribed
when he filed his claim on 9 November 1994.
Ruling:
No. Respondent claim for compensation benefit has not yet prescribed when he filed his it.
Under Article 201 of the Labor Code, filing of compensation claims should reckoned from the
time the employee lost his earning capacity, i.e. terminated from employment, due to his
illness and not when the same first became manifest. Indeed, a person disability might not
emerge at one precise moment in time but rather over a period of time. In this case, private
respondent employment was terminated on 31 December 1991 due to his illness, he filed his
claim for compensation benefits on 9 November 1994.
Accordingly, the private respondent claim was filed within the three-year prescriptive period
under Art. 201 of the Labor Code.

The Court consistently ruled that disability should not be understood more on its medical
significance but on the loss of earning capacity.
In disability compensation, it is not the injury which is compensated, but rather it is the
incapacity to work resulting in the impairment of ones earning capacity.
G.R. No. 117572 Jnauary 29, 1998
GSIS vs CA
Facts:
This is a petition for review on certiorari seeking to annul and set aside the decision
of the Court of Appeals (CA) dated October 17, 1994 which reversed the decision
issued by the Employees Compensation Commission (ECC), affirming the decision of
petitioner Government Service Insurance System (GSIS) that private respondent Rosa
Balais is not entitled to conversion of compensation benefits from partial disability for
a 9month period after retirement to total disability.
Private respondent, Rosa Balais, was an employee of the National Housing Authority
(NHA) since1952. At the age of sixty-two (62), she was forced to retire from the
government service because she was diagnosed to be sufferingfrom Subarachnoid
Hemorrhage Secondary to Ruptured Aneurysm.
Her claim for temporary total disability (TTD) benefitsfor the period starting from
December 17, 1989 to January 31, 1990 and subsequently, permanentpartial
disability (PPD) benefits for nine months starting on March 2, 1990 was granted by
the Government Service Insurance System (GSIS).
However, her request for the conversion ofthe classification of her disability benefits
from PPD to permanent total disability (PTD) was denied by the GSIS. When her
request for reconsideration was also denied, which denial was later affirmed on
appeal by the Employees Compensation Commission (ECC) prompted respondent to
file a petition for review with the Court of Appeals whichpromulgated a decision in her
favor, hence this appeal by petitioner GSIS.

Issue:
Whether or not private respondent is entitled to conversion of herbenefits from permanent
partial disability to permanent total disability.

Held:
Yes. While it is true that the degree of private respondents physical condition at the time of
herretirement was not considered as permanent total disability, yet, it cannot be denied that
her conditionsubsequently worsened after her head operation and consequent retirement. In
fact, she sufferedafterwards from some ailments like headaches, dizziness, weakness,
inability to properly sleep,inability to walk without support and failure to regain her memory.
All these circumstances ineluctablydemonstrate the seriousness of her condition, contrary to
the claim of petitioner. More than that, it wasalso undisputed that private respondent was
made to take her medication for life.

A persons disability may not manifest fully at one precise moment in time but rather over a
periodof time. It is possible that an injury which at first was considered to be temporary may
later on becomepermanent or one who suffers a partial disability becomes totally and
permanently disabled from thesame cause.

The Supreme Court has ruled that disability should not be understood more on its
medicalsignificance but on the loss of earning capacity.Judicial precedents likewise show that
disability is intimately related to ones earning capacity. Ithas been a consistent
pronouncement of the Court that permanent total disability means disablementof an
employee to earn wages in the same kind of work, or work of a similar nature that she
wastrained for or accustomed to perform, or any kind of work which a person of her
mentality andattainment could do. It does not mean state of absolute helplessness, but
inability to dosubstantially all material acts necessary to prosecution of an occupation for
remuneration or profit insubstantially customary and usual manner.

It is also important to note that private respondent was constrained to retire at the age of 62
yearsbecause of her impaired physical condition. This, again, is another indication that her
disability ispermanent and total. As held by this Court, the fact of an employees disability is
placed beyondquestion with the approval of the employees optional retirement, for such is
authorized only when theemployee is `physically incapable to render sound and efficient
service.

In the case at bar, the denial of the claim for permanent total disability benefit of private
respondent who, for 38 long years during her prime had rendered her best service with
anunblemished record and who was compelled to retire on account of her worsening
condition, wouldindeed subvert the salutary intentions of the law in favor of the worker. The
Court, therefore, affirmsthe decision of the respondent Court of Appeals decreeing
conversion of private respondentsdisability from permanent partial disability to permanent
total disability
G.R. No. 80157 February 6, 1990
Narazo vs Employees Compensation Commission
Facts:
This is a petition for review of the decision of the Employees Compensation
Commission (ECC) dated 19 May 1987, 1 denying petitioners claim for compensation
benefits under PD 626, as amended, for the death of her husband, Geronimo Narazo.
On 14 May 1984, Geronimo Narazo died at the age of fifty seven (57). Narazo was
employed for thirty eight (38) years as Budget Examiner in the Office of the
Governor, Province of Negros Occidental. His was diagnosed to be suffering from
"obstructive nepropathy due to benign prostatic hypertrophy", commonly known as
"Uremia.".
Government Service Insurance System (GSIS) denied the Claim for death benefits
filed by the Petitioner, as the widow of the deceased, on the ground that the cause of
death of Narazo is not listed as an occupational disease, and that there is no showing
that the position and duties of the deceased as Budget Examiner had increased the
risk of contracting "Uremia.". Petitioners motion for reconsideration was also denied
by the GSIS.
On appeal, the Employees Compensation Commission (ECC) affirmed the decision of
the GSIS on the ground that the ailments of the deceased could not be attributed to
employment factors and as impressed by medical experts, benign prostatic
hypertrophy is quite common among men over fifty (50) years of age, regardless of
occupation, while uremia is a complication of obstructive nephropathy due to benign
prostatic hypertrophy; hence, this petition.

Issue:
Whether or not Geronimo Narazo is entitled to death benefit under the Employees
Compensation Law (PD626 as amended).
Held:
Yes. The death of petitioners husband was caused by "Uremia due to obstructive
nephropathy and benign prostatic hypertrophy," which is admittedly not among those listed
as occupational diseases.

The nature of the work of the deceased as Budget Examiner in the Office of the Governor
dealt with the detailed preparation of the budget, financial reports and review and/or
examination of the budget of other provincial and municipal offices. Full concentration and
thorough study of the entries of accounts in the budget and/or financial reports were
necessary, such that the deceased had to sit for hours, and more often than not, delay and
even forego urination in order not to interrupt the flow of concentration.
In the case of Ceniza v. ECC, the Court held that: ". . . . It may be added that teachers have a
tendency to sit for hours on end, and to put off or postpone emptying their bladders when it
interferes with their teaching hours or preparation of lesson plans. From human experience,
prolonged sitting down and putting off urination result in stagnation of the urine. This
encourages the growth of bacteria in the urine, and affects the delicate balance between
bacterial multiplication rates and the host defense mechanisms. Delayed excretion may
permit the retention and survival of micro-organisms which multiply rapidly, and infect the
urinary tract. These are predisposing factors to pyelonephritis and uremia. Thus, while we
may concede that these illnesses are not directly caused by the nature of the duties of a
teacher, the risk of contracting the same is certainly aggravated by their working habits
necessitated by demands of job efficiency."
Thus, it was held that the cause of death of petitioners husband is work-connected, i.e. the
risk of contracting the illness was aggravated by the nature of the work, so much so that
petitioner is entitled to receive compensation benefits for the death of her husband. Hence,
petition is granted. ECCs decision is reversed and set aside.
G.R. No. L-58445 April 27, 1989
ZAIDA G. RARO, petitioner,
vs.
EMPLOYEES' COMPENSATION COMMISSION and GOVERNMENT SERVICE INSURANCE SYSTEM
(Bureau of Mines and Geo-Sciences), respondents.

Facts:
Petitioner states that she was in perfect health when employed as a clerk by the
Bureau of Mines and Geo-Sciences at its Daet, Camarines Norte regional office on March
1975. About four years later, she began suffering from severe and recurrent headaches
coupled with blurring of vision. Forced to take sick leaves, she sought medical treatment in
Manila. She was then a Mining Recorder in the Bureau.
The petitioner was diagnosed at the Makati Medical Center with brain tumor. By that
time, her memory, sense of time, vision, and reasoning power had been lost.
A claim for disability benefits filed by her husband with the GSIS was denied. A
motion for reconsideration was similarly denied. An appeal to the Employees' Compensation
Commission resulted in the Commission's affirming the GSIS decision.
Issues:
1. Whether brain tumor which causes are unknown but contracted during
employment is compensable under the present compensation laws.
2. Whether the presumption of compensability is absolutely inapplicable under the
present compensation laws when a disease is not listed as occupational disease.
Held:
1. No. The Court recognized the fact that cancer is a disease of still unknown origin
which strikes people in all walks of life, employed or unemployed. Unless it be shown that a
particular form of cancer is caused by specific working conditions, we cannot conclude that it
was the employment which increased the risk of contracting the disease.The law requires
the claimant to prove a positive thing the illness was caused by employment and the risk
of contracting the disease is increased by the working conditions. To say that since the proof
is not available, therefore, the trust fund has the obligation to pay is contrary to the legal
requirement that proof must be adduced. The existence of otherwise non-existent proof
cannot be presumed.
2. Yes. The Workmen's Compensation Act was replaced by a novel scheme under the
new Labor Code. The new law discarded the concept of "presumption of compensability" and
substituted a system based on social security principles. The present system is also
administered by social insurance agencies (GSIS and SSS) under the Employees'
Compensation Commission. Now, we have a social insurance scheme where regular
premiums are paid by employers to a trust fund and claims are paid from the trust fund to
those who can prove entitlement.If diseases not intended by the law to be compensated are
inadvertently or recklessly included, the integrity of the State Insurance Fund is endangered.
Compassion for the victims of diseases not covered by the law ignores the need to show a
greater concern for the trust fund to which millions of workers and their families look for
compensation whenever covered accidents, salary and deaths occur.
G. R. No. 84777 January 30, 1992
JOSE A. BEJERANO, petitioner,
vs.
EMPLOYEES COMPENSATION COMMISSION, respondent.

Facts:
Petitioner Jose Bejerano was a cash supervisor of the Development Bank of the
Philippines, Zamboanga City Branch Office. He retired at the age of 62 after having served
the bank for almost 29 years.
Medical records show that sometime in 1985, petitioner complained of dyspnea or
shortness of breath accompanied by productive cough. He was admitted to the Brent
Hospital, where he was medically diagnosed with Chronic Obstructive Lung Disease
Emphysema with severe asthmatic component. The medical certificate states that petitioner
was admitted 3 times to Brent Hospital in 1985 for treatment of chronic obstructive lung
disease. In the same medical certificate, the attending physician classified petitioner's
disability as permanent total. Due to his disability, petitioner was forced to retire at the age
of 62 on December 31, 1985 and received the sum of P60,890.57 corresponding to 5 years
lump sum of his annuity.
In 1987, petitioner was again confined at the Zamboanga Regional Hospital on 3
different dates. Subsequently, petitioner filed a claim for compensation benefits with the
GSIS, which was favorably acted upon. The GSIS awarded petitioner Bejerano benefits for
temporary total disability for the period of December 6-9, 1985 and permanent partial
disability from January 1986 to July 1987.

Not satisfied with the award, petitioner requested the GSIS for a change of the
classification of his disability benefits from permanent partial to permanent total. Such
request was denied by the GSIS. Petitioner then filed a request for reconsideration of the
earlier denial of his request. GSIS again denied such request. Hence, this petition.

Issue:

Whether or not petitioner's disability would entitle him to compensation benefits

corresponding to permanent total disability
Held:
Yes, petitioner is entitled to said benefits.
It has been repeatedly held by the Court that "permanent total disability means
disablement of an employee to earn wages in the same kind of work, or work of a similar
nature that she was trained for or accustomed to perform, or any kind of work which a
person of her mentality and attainment could do." Permanent total disability is the lack of
ability to follow continuously some substantially gainful occupation without serious
discomfort or pain and without material injury or danger to life.It is therefore clear that the
loss of one's earning capacity determines the disability compensation one is entitled to.
The petitioner's claim is substantiated with enough evidence to show that his
disability is permanent and total. Firstly, the attending physician diagnosed petitioner's
condition as Chronic Obstructive Lung Disease and classified petitioner's disability as
permanent and total. Secondly, petitioner was forced to retire at the age of 62 because of
his physical condition which is another indication that petitioner's disability is permanent
and total.
BEBERISA RIO vs. ECC and SSS, G.R. No. 132558, May 9, 2000

Facts:
Virgilio T. Rio Sr., husband of herein petitioner, was employed by Allied Port Services Inc. as
stevedore since July, 1982. His duties included: (1) handling of steel cargoes; (2) loading and
unloading of silica sand; (3) handling, loading and unloading of lumber products; (4)
supervising other stevedores; and (5) performing other related work.

Rio Sr., as a stevedore died of Uremia secondary to chronic renal failure three days after
he was rushed to the hospital after collapsing at work.

His widow claimed for death benefits from the SSS. The claim was denied by the system.

On appeal, the ECC affirmed the findings of the SSS. Ruling that petitioner failed to present
relevant evidence to establish the causal connection between the deceaseds ailment and
his work as stevedore.

After the ECC denied the Motion for Reconsideration, petitioner appealed to the CA.
However, the CA affirmed the decision of ECC and SSS.

Petitioner is seeking to set aside the June 30, 1997 Decision of the Court of Appeals (CA) in
CA-GR SP No. 41257, affirming the decision of ECC and SSS.

Issue:Whether or not Rios Death was compensable under PD626 by virtue of the
increased risk theory.

Ruling:The Court held that the decedents death was non-compensable.The Petition has no
merit.

Death benefits under the Labor Code, as amended, are awarded only when the cause of
death is listed as an occupational disease by the Employees Compensation Commission, or
when the claimant presents proof that the working conditions increased the risk of
contracting the fatal disease.

The primary and antecedent causes of VirgilioRios death are not listed as occupational
diseases. Hence, petitioner should have presented substantial evidence, or such relevant
evidence which a reasonable mind might accept as adequate to justify a conclusion, showing
that the nature of her husbands employment or working conditions increased the risk of
uremia, chronic renal failure or chronic glomerulonephritis. Bare allegations do not ipso facto
make the death compensable. Since the petitioner failed to must adduce evidence to prove
work-connection, the denial of claim was held proper.

Held:The Petition is hereby DENIED and the assailed Decision and Resolution AFFIRMED. No
pronouncement as to costs.
 G.R. NO. 89168
Rosa Lentejas vs Employees Compensation Commission

Facts:
VictorioLentejas, the husband of petitioner Rosa Lentejas, entered the government service
on 13 January 1968. Eventually, he was promoted as General Foreman at the City Engineer's
Office of Calbayog City. His official working hours were from 8:00 A.M. to 5:00 P.M.

On 25 July 1984, Victorio as general foreman of the City Engineer's Office, went to Barangay
Banti, Tinambacan District, Calbayog City, there to inspect work being done on a damaged
seawall protecting the shoreline against encroachment by the sea. At around 4:30 P.M.,
being then (according to the police report) on his way home from that place, Victorio was
suddenly attacked and stabbed with a knife by Arnulfo Luaton who inflicted upon him
multiple stab wounds on different parts of the body causing his instantaneous death.

Police investigation showed that the killing was brought about by a personal grudge. The
deceased Victorio and the killer Arnulfo were owners of adjoining lots situated in
San Vicente St., Tinambacan District, Calbayog City and they were in
disagreement as to the correct boundary between their respective lots. About six
(6) months earlier, petitioner and Arnulfo's father had a heated argument
regarding this boundary dispute.

Because of Victorio's death, petitioner as the surviving spouse filed with the Government
Service Insurance System (GSIS) a claim for compensation benefits under the provisions of
Presidential Decree No. 626, as amended.

Issue:
The GSIS denied her claim upon the ground that the killing was not work-connected since
the motive of the assailant in slaying her husband was a personal grudge. Petitioner filed a
motion for reconsideration, which motion was denied by the GSIS. This denial was elevated
by the petitioner to public respondent Employees' Compensation Commission (ECC). The
ECC, however, in its decision dated 24 May 1989, affirmed the decision of the GSIS denying
petitioner's claim for compensation benefits on the same basis that the cause of Victorio's
death was not work-connected.

Under, the Amended Rules on Employees' Compensation promulgated by the ECC and
relating to both government and private sector employees, more particularly Section 1 of
Rule III, the requirements for compensability of an injury and the resulting death are as
follows:

a) For the injury and the resulting death to be compensable, the injury must be the
result of an employment accident satisfying all of the following conditions:
1. the employee must have been injured at the place where his work requires
him to be;
2. the employee must have been performing his official function petitions;
3. if the injury is sustained elsewhere, the employee must have been
executing an order for the employer.
Ruling:
Deliberating on the instant Petition for Review on Certiorari, the Court believes that the
decision of the ECC should be reversed and petitioner's claim for compensation benefits
granted.

It is not disputed that on 24 July 1984, VictorioLentejas, a general foreman at the City
Engineer's Office, Calbayog City, was assigned the task of inspecting the construction or
rehabilitation work then in process on the damaged seawall along the shoreline of Barangay
Banti. While he was on his way from Barangay Banti, Arnulfo Luaton attacked and stabbed
him with deadly effect. He was dead when the police reached the scene of the crime; the
circumstances of Victorio's death were related by an eyewitness to the police officers. Thus,
there was no definite evidence to show that the deceased was actually on his way home at
the time of the attack upon him. The killing took place at 4:30 P.M., that is, during the
deceased's official hours of work and hence, Victorio might well have been on his way back
to the City Engineer's Office when he was set upon and killed. He was, in other words, on
official time and in the course of performing his official functions when he was attacked.

After careful examination of the Vda. de Torbela, Alano and Lazo cases, we believe and so
hold that the case at bar falls within the scope of the rule set out in those cases. There is no
question that the deceased in the instant case did not foresee, and could not have foreseen,
the attack on himself when he undertook to go to Barangay Banti to inspect and oversee the
municipal construction work then on-going in that place. In so far as the mind and will of the
victim were concerned, the homicidal intent on the part of Arnulfo Luaton was as external
and fortuitous an event as a speeding mini-bus or a recklessly negligent jeepney driver. In
other words, we do not think that the third person's criminal intent should be regarded as a
supervening cause having the effect of nullifying the circumstance that, when Victorio was
attacked and killed, he was where his work required him to be and that he was then in the
course of performing his official duties.

Held:
ACCORDINGLY, the Court Resolved to GRANT due course to the Petition for Review, to TREAT
the Comment of respondent Commission as its Answer, and to REVERSE and SET ASIDE the
decision of the Employees' Compensation Commission dated 24 May 1989. The case is
hereby REMANDED to the ECC and the GSIS for disposition conformably with this Resolution.
 ROBERTO R. BENEDICTO, petitioner,
vs.
HON. QUIRINO D. ABAD SANTOS, JR., in his capacity as Presiding Judge of the
Regional Trial Court of Negros Occidental, and SOCIAL SECURITY SYSTEM,
respondents.
G.R. No. 74689 March 21, 1990
FACTS:
This is a Petition for Prohibition and Mandamus with preliminary injuction of petitioner
Roberto Benedicto who seeks to set aside the Orders of the respondent Judge denying,
respectively, petitioner's Motion to Quash Criminal Case No. 3863 and his related Motion for
Reconsideration.
Salvador Pillon is an employee in the business of respondent Benedicto. He was
employed as a truck driver in that business but Benedicto did not report to SSS his
employment and did not pay his SSS contribution. After the death of Pillon, SSS came to the
knowledge that Benedicto did not report Pillons employment to the Social Security System
for compulsory coverage and did not pay the corresponding SSS contribution. Mr. Antonio
Obillos, Jr., an investigator of SSS Regional Office in Bacolod City conducted an inquiry
regarding the alleged violation of Benedicto of Republic Act no. 1161 or the Social Security
Act. In his report, he mentioned that Benedicto admitted that he failed to report and to
register with the SSS Pillons employment from 1971 up to the time of Pillons death in 1974
and he also failed to pay Pillons contribution. Upon the suggestion of Obillos, Benedicto had
accomplished and submitted SSS Forms E-1 and R-1A reporting himself and Pillon for SSS
compulsory coverage and he was assessed SSS premiums in the total amount of 491.70
pesos excluding the penalty. Then, it was recommended that his report needs to be
transmitted to the Legal Department of the SSS for appropriate action.
Ten years later, on July 1985, the Legal Department of the SSS, the Assistant City
Fiscal of Bacolod City filed an information charging Benedicto with violations of Section 24
(a) in relation to Section 28 (e) of the Social Security Act, as amended. However, before
arraignment, petitioner Benedicto moved to quash the information asserting that his liability
thereunder had already been extinguished by prescription. The complainant SSS opposed
the Motion to Quash contending that the offense charged in the information had not yet
prescribed since the applicable prescriptive period was twenty (20) years and since the
information was filed within this 20-year period.
The trial judge denied Benedictos Motion to quash. Benedicto further argued that the
20-year prescriptive period established in Section 22 (b) of the Social Security Act relied
upon by the respondent Judge, applies only in respect of administrative and civil actions
involving delinquency in the remittance of contributions to the SSS, and not to a criminal
action.Benedicto filed a motion for reconsideration but it was also denied. Hence, this
petition.
ISSUE:
Whether or not the offense with which petitioner Benedicto is charged has
prescribed.
RULING:
The court ruled that the offense charged to Benedicto has already prescribed since
the information was filed against petitioner Benedicto ten (10) years after the alleged
violations had been discovered by the SSS. The Supreme Court asserted that, the 20-year
prescriptive period found in Section 22 of the Social Security Act deals generally with the
remittance of contributions to the SSS and Section 22 (b) does not deal with penal sanctions
for violations of provisions of the Social Security Act nor of the rules and regulations
promulgated by the Social Security Commission. Also, Section 22 (b) will show that the
"necessary action against the employer" referred to in the second paragraph thereof is an
action that is brought against the employer for the collection of contributions payable under
the Social Security Act which the employer has refused or neglected to pay. The prescriptive
period applicable in this case is four years.
The Petition for Prohibition and Mandamus with preliminary injunction was granted.
CASE NO. 20
PEOPLE OF THE PHILIPPINES, Appellant, vs. SALVADOR MONTEIRO, Appellee.
[G.R. No. 49454 : December 21, 1990.]

FACTS:

The appellant is questioning the order of the Court of First Instance of Laguna
granting the motion to quash the following information against Salvador Monteiro:

Monteiro Footwear is an establishment engaged in the manufacture of footwear

while Elizabeth Collantes is a member of SSS and was employed in the said establishment.
From January 1964 to May 31, 1974 at Liliw, Laguna within the jurisdiction of Honorable
Court, Montieros Footwear being the operator and owner of the said establishment did
willfully, unlawfully and feloniously fail to register and/or report to the Social Security System
the employment of Elizabeth Collantes. Collantesonly learned that she was not a member
when she wanted avail herself of SSS benefits because of the hospitalization of her
husband.Despite the demands of Collantes the petitioner failed to register her.The reason for
the quashal was prescription.

The trial court reckoned the 4-year prescriptive period from January 1964, holding that the
crime was deemed committed from the time the private respondent failed to register the
employee. No other act was needed to complete the crime.The appellant contends
otherwise, the 4-year period should commence, not in January 1964, when the violation
started, but in May 1974, when it was discovered. However, Montiero argues that the
appellant cannot change its theory on appeal from its original position that the offense was a
continuing one. He insists that the prescriptive period should be counted from the date of
the alleged violation as this was not concealed and did not have to be discovered.Hence,
this petition.

ISSUE:

Whether or not the prescriptive period should commence when the violation started
or when it was already discovered.

RULING:

The Supreme Court ruled that the prescriptive period should begin from the day of
the discovery of the violation and not when the violation started. In Benedicto v. Abad
Santos, the court said that, the information was filed against petitioner Benedicto ten years
after the alleged violations had been discovered by the SSS. We hold that the statutory
crime here charged had prescribed by then, the prescriptive period here applicable being
four years. Despite the fact that it was not the ratiodecidendi of that case, Supreme Court
affirm the conclusion that the period of prescription for the offense of failure to register with
the SSS shall begin from the day of the discovery of the violation if this was not shown at the
time of its commission.

In the case of People v Dinsay where the Court dismissed the information because it
had been filed beyond the prescriptive period is not in point. The estafa committed by the
accused was known to the offended party from the very start; one would say the
commission and the discovery of the offense were simultaneous. However, in the case at
bar, it does not appear that Collantes knew at the outset, that is, from January 1964, that
she had not been registered by the appellee with the SSS. The challenged order is set aside.
 AGRARIAN REFORM CASES
Daez vs CA
G.R. No. 133507 (February 17, 2000)

Facts:

EudosiaDaez applied for exemption of her 4.1685 hectare riceland in Brgy.Lawa,

Meycauayan, Bulacan being cultivated by the herein respondents. DARUndersecretary Jose
C. Medina denied the application for exemption uponfinding that the subject land is covered
under LOI 474, the petitioner's totalproperties having exceeded the 7-hectare limit provided
by law.

The Secretary of DAR, Benjamin T. Leong, the Court of Appeals and theSupreme Court all
affirmed the said Order and disregarded an Affidavitexecuted by the respondents stating
that they are not the tenants of the land.Their findings was that the Affidavit was merely
issued under duress. In themeantime, Emancipation Patents (EPs) were issued to the
respondents.

Undaunted, Daez next filed an application for retention of the same Riceland under R.A. No.
6657. DAR Region III OIC-Director Eugenio B. Bernardoallowed her to retain the subject
riceland but denied the application of herchildren to retain three (3) hectares each for failure
to prove actual tillage ordirect management thereof. This order was set aside by the DAR
SecretaryErnesto Garilao but reinstated on appeal by the Office of the President. TheCourt of
Appeals again reversed this Decision and ordered the reinstatementof the previous Decision
of DAR Secretary Ernesto D. Garilao. Hence, thisAppeal.

Issue:
Whether or not petitioner can still file a petition for retention of the subjectlandholdings,
despite the fact that a previous decision denying the petitionfor exemption had long become
final and executory

Ruling:

It is incorrect to posit that an application for exemption and an application forretention are
one and the same thing. Being distinct remedies, finality of judgment in one does not
preclude the subsequent institution of the other.There was, thus, no procedural impediment
to the application filed by EudosiaDaez for the retention of the subject 4.1865 hectare
riceland, even after herappeal for exemption of the same land was denied in a decision that
becamefinal and executory.

The right of retention is a constitutionally guaranteed right, which is subject toqualification

by the legislature. It serves to mitigate the effects of compulsoryland acquisition by
balancing the rights of the landowner and the tenant by implementing the doctrine that
social justice was not meant to perpetrate aninjustice against the landowner. A retained area
as its name denotes, is landwhich is not supposed to anymore leave the landowner's
dominion, thus sparing the government from the inconvenience of taking land only to return
itto the landowner afterwards, which would be a pointless process.

The issuance of EPs and CLOAs to beneficiaries does not absolutely bar thelandowner from
retaining the area covered thereby. Under AdministrativeOrder No. 2, Series of 1994, an EP
or CLOA may be cancelled if the landcovered is later found to be part of the landowner's
retained area.
 GR No. 171972
LUCIA RODRIGUEZ AND PRUDENCIA RODRIGUEZ
vs.
TERESITA V. SALVADOR
Facts:
On May 22, 2003, respondent Teresita V. Salvador filed a Complaint for Unlawful
Detainer, docketed as Civil Case No. 330, against petitioners Lucia (Lucia) and Prudencia Rodriguez,
mother and daughter, respectively before the Municipal Trial Court (MTC) of Dalaguete, Cebu.
Respondent alleged that she is the absolute owner of a parcel of land covered by Original Certificate
of Title (OCT) No. P-27140 issued by virtue of Free Patent No. (VII-5) 2646 in the name of the Heirs of
Cristino Salvador represented by Teresita Salvador; that petitioners acquired possession of the
subject land by mere tolerance of her predecessors-in-interest; and that despite several verbal and
written demands made by her, petitioners refused to vacate the subject land.
In their Answer, petitioners interposed the defense of agricultural tenancy. Lucia claimed
that she and her deceased husband, Serapio, entered the subject land with the consent and
permission of respondents predecessors-in-interest, siblings Cristino and Sana Salvador, under the
agreement that Lucia and Serapio would devote the property to agricultural production and share
the produce with the Salvador siblings. Since there is a tenancy relationship between the parties,
petitioners argued that it is the Department of Agrarian Reform Adjudication Board (DARAB) which
has jurisdiction over the case and not the MTC.

On July 10, 2003, the preliminary conference was terminated and the parties were ordered
to submit their respective position papers together with the affidavits of their witnesses and other
evidence to support their respective claims.

Issues:
I.
WHETHER OR NOT THE COURT OF APPEALS ACTED WITH GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OR IN EXCESS OF JURISDICTION IN RULING THAT
PETITIONERS-DEFENDANTS ARE NOT TENANTS OF THE SUBJECT LAND.

II.
WHETHER OR NOT SUCH RULING OF THE COURT OF APPEALS HAS FACTUAL AND
LEGAL BASIS AND IS SUPPORTED WITH SUBSTANTIAL EVIDENCE.

Ruling:
The petition lacks merit.

Agricultural tenancy relationship does not exist

in the instant case.
Agricultural tenancy exists when all the following requisites are present: 1) the parties are
the landowner and the tenant or agricultural lessee; 2) the subject matter of the relationship is an
agricultural land; 3) there is consent between the parties to the relationship; 4) the purpose of the
relationship is to bring about agricultural production; 5) there is personal cultivation on the part of
the tenant or agricultural lessee; and 6) the harvest is shared between landowner and tenant or
agricultural lessee.

In this case, to prove that an agricultural tenancy relationship exists between the parties,
petitioners submitted as evidence the affidavits of petitioner Lucia and their neighbors. In her
affidavit, petitioner Lucia declared that she and her late husband occupied the subject land with the
consent and permission of the original owners and that their agreement was that she and her late
husband would cultivate the subject land, devote it to agricultural production, share the harvest with
the landowners on a 50-50 basis, and at the same time watch over the land. Witness Alejandro Arias
attested in his affidavit that petitioner Lucia and her husband, Serapio, have been cultivating the
subject land since 1960; that after the demise of Serapio, petitioner Lucia and her children continued
to cultivate the subject land; and that when respondents predecessors-in-interest were still alive, he
would often see them and respondent get some of the harvest.The affidavit of witness
ConsesoMuoz stated, in essence, that petitioner Lucia has been in peaceful possession and
cultivation of the subject property since 1960 and that the harvest was divided into two parts, for
the landowner and for petitioner Lucia.
The statements in the affidavits presented by the petitioners are not sufficient to prove the
existence of an agricultural tenancy.
As correctly found by the CA, the element of consent is lacking. Except for the self-serving
affidavit of Lucia, no other evidence was submitted to show that respondentspredecessors-in-
interest consented to a tenancy relationship with petitioners. Self-serving statements, however, will
not suffice to prove consent of the landowner; independent evidence is necessary.

Aside from consent, petitioners also failed to prove sharing of harvest. The affidavits of
petitionersneighbors declaring that respondent and her predecessors-in-interest received their share
in the harvest are not sufficient. Petitioners should have presented receipts or any other evidence to
show that there was sharing of harvest and that there was an agreed system of sharing between
them and the landowners.

As we have often said, mere occupation or cultivation of an agricultural land will not ipso
facto make the tiller an agricultural tenant. It is incumbent upon a person who claims to be an
agricultural tenant to prove by substantial evidence all the requisites of agricultural tenancy.

In the instant case, petitioners failed to prove consent and sharing of harvest between the
parties. Consequently, their defense of agricultural tenancy must fail. The MTC has jurisdiction over
the instant case. No error can therefore be attributed to the CA in reversing and setting aside the
dismissal of respondents complaint for lack of jurisdiction. Accordingly, the remand of the case to
the MTC for the determination of the amount of damages due respondent is proper.

Respondent is entitled to the fair rental value

or the reasonable compensation for the use
and occupation of the subject land.

We must, however, clarify that the only damage that can be recovered [by respondent] is
the fair rental value or the reasonable compensation for the use and occupation of the leased
property. The reason for this is that [in forcible entry or unlawful detainer cases], the only issue
raised in ejectment cases is that of rightful possession; hence, the damages which could be
recovered are those which the [respondent] could have sustained as a mere possessor, or those
caused by the loss of the use and occupation of the property, and not the damages which [she] may
have suffered but which have no direct relation to [her] loss of material possession.

WHEREFORE, the petition is DENIED. The assailed August 24, 2005 Decision and the
February 20, 2006 Resolution of the Court of Appeals in CA G.R. SP No. 86599 are AFFIRMED. This
case is ordered REMANDED to the Municipal Trial Court of Dalaguete, Cebu, to determine the
amount of damages suffered by respondent by reason of the refusal and failure of petitioners to turn
over the possession of the subject land, with utmost dispatch consistent with the above disquisition.
 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.
Facts:
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
Issue:
Whether or not lands obtained through homestead patent are covered by the Agrarian
Reform under P.D. 27.
Ruling:
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.'
Natalia Realty, Inc. and Estate Developer and Investors Corp vs DAR
Facts:
Natalia is the owner of 3 contiguous parcels of land with an area of 120.9793 hectares,
1.3205 hectares and 2.7080 hectares or a total of 125.0078 hectares, which are covered by
TCT No. 31527. Presidential Proclamation No. 1637 set aside 20,312 hectares of land as
townsite areas to absorb the population overspill in the metropolis which were designated as
the Lungsod Silangan Townsite. The Natalia properties are situated within the areas
proclaimed as townsite reservation. Since private landowners were allowed to develop their
properties into low-cost housing subdivisions with the reservation, petitioner EDIC as
developer of Natalia applied for and was granted preliminary approval and location
clearances by the Human Settlements Regulatory Commission, which Natalia thereafter
became Antipolo Hills Subdivision. On June 15 1988, Ra 6657 went to effect. Respondent
issed a Notice of Coverage on the undeveloped portions of Antipolo Hills Subdivision. Natalia
and EDIC immediately registered its objection to the notice of coverage and requested the
cancellation of the Notice of Coverage. Natalia and EDIC both argued that the properties
ceased to be agricultural lands when they were included in the areas reserved by
Presidential Proclamation for the townsite reservation. DAR then contended that the permits
granted were not valid and binding since they did not comply with t he implementing
Standards, Rules and Regulations of PD 957 (The Subdivision and Condominium Buyers
Protective Decree), and that there was no valid conversion of the properties.
Issue:
Whether or not lands not classified for agricultural use, as approved by the Housing and
Land Use Regulatory Board and its agencies prior to June 15, 1988 covered by RA 6657.
Ruling:
No, Sec. 4 of RA 6657 provides that CARL shall cover, regardless of tenurial arrangement
and commodity produced, all public and private agricultural lands. And agricultural lands is
referred to as land devoted to agricultural activity and not classified as mineral, forst,
residential, commercial or industrial land. Thus, the underdeveloped portions of the Antipolo
Hills Subdivision cannot be considered as agricultural lands for this land was intended for
residential use. They ceased to be agricultural land by virtue of the Presidential Proclamation
No. 1637.
Luz Farms vs Sec. of Agrarian Reform
Facts:
On June 10, 1988, the President of the Philippines approved R.A. No. 6657, which includes
the raising of livestock, poultry and swine in its coverage. Luz Farms, petitioner in this case,
is a corporation engaged in the livestock and poultry business and together with others in
the same business allegedly stands to be adversely affected by the enforcement of Section
3(b), Section 11, Section 13, Section 16(d) and 17 and Section 32 of R.A. No. 6657 otherwise
known as Comprehensive Agrarian Reform Law and of the Guidelines and Procedures
Implementing Production and Profit Sharing under R.A. No. 6657 promulgated on January 2,
1989 and the Rules and Regulations Implementing Section 11 thereof as promulgated by the
DAR on January 9, 1989. Hence, this petition praying that aforesaid laws, guidelines and
rules be declared unconstitutional. Meanwhile, it is also prayed that a writ of preliminary
injunction or restraining order be issued enjoining public respondents from enforcing the
same, insofar as they are made to apply to Luz Farms and other livestock and poultry
raisers.

Issue:
Whether or not livestock and poultry lands should be included in agrarian reform.

Held:
No, Sections 13 and 32 of RA6657 directing corporate farms which include livestock and
poultry raisers to implement production sharing plans whereby they are called upon to
redistribute 3% of their gross sales and 10% of their gross profits to their workers is
Unreasonable for being confiscatory. Therefore, violates the due process.
DAR vs Sutton
Facts:
Respondent inherited a land in Aroroy, Masbate devoted exclusively to cow and calf
breeding. On October 26, 1987, pursuant to the existing agrarian reform program of the
government, respondent made a voluntary offer to sell (VOS) their landholdings to petitioner
DAR to avail incentives under the law. On June 10, 1988, a new agrarian law, RA 6657 known
as Comprehensive Agrarian Reform Law (CARL) of 1988 took effect. It included in its
coverage farms used for raising livestock, poultry and swine. An en banc decision in the case
of Luz Farms vs. Secretary of DAR, ruled that land devoted to livestock and poultry-raising
are not included in the definition of agricultural land. In view of the Luz Farm ruling,
respondent filed with petitioner DAR a formal request to withdraw their VOS as their
landholding was exclusively to cattle-raising and thus exempted from the coverage of the
CARL. Petitioner ignored their request. DAR issue A.O No. 9, series of 1993, which provided
that only portion of private agricultural lands used for the raising of livestock, poultry and
swine as of June 15, 1988 shall be excluded from the coverage of the CARL. In determining
the area of land to be excluded the A.O fixed the following retention limits, viz 1:1 animal-
land ratio and the ration of 1.7815 hectares for livestock infrastructure for every 21 heads of
cattle shall likewise be excluded from the operation of the CARL. DAR Secretary Garilao issue
an Order partially granting the application of respondents for exemption from the coverage
of CARL applying the retention limit outlined in the DAR A.O No. 9. Petitioner ordered the
rest of respondents landholding to be segregated and placed under Compulsory Acquisition.
On October 2001, the Office of the President affirmed the impugned Order of petitioner DAR.
It ruled that DAR A.O. no. 9 does not run counter to the Luz Farm case as the A.O provided
the guidelines to determine whether a certain parcel of land is being used for cattle-raising.
Issue:
Whether of not DAR A.O No.9 is unconstitutional?
Ruling:
In the case at bar, SC find that the impugned A.O. is invalid as it contravenes the
Constitution. The A.O. sought to regulate livestock farms by including them in the coverage
of agrarian reform and prescribing a maximum retention limit for their ownership. However,
the deliberations of the 1987 Constitutional Commission show a clear intent to exclude, inter
alia, all lands exclusively devoted to livestock, swine and poultry- raising. The Court clarified
in the Luz Farms case that livestock, swine and poultry-raising are industrial activities and do
not fall within the definition of agriculture or agricultural activity. The raising of
livestock, swine and poultry is different from crop or tree farming. It is an industrial, not an
agricultural, activity.
G.R. No. 182332 : February 23, 2011

MILESTONE FARMS, INC.,Petitioner,v. OFFICE OF THE PRESIDENT,Respondent.

NACHURA,J.:
FACTS:

Petitioner Milestone Farms, Inc. was incorporated with the SEC. On June 10, 1988, a new
agrarian reform law, Republic Act (R.A.) No. 6657, otherwise known as the Comprehensive
Agrarian Reform Law (CARL), took effect, which included the raising of livestock, poultry, and
swine in its coverage. However, on December 4, 1990, this Court, sitting en banc, ruled in
Luz Farms v. Secretary of the Department of Agrarian Reform that agricultural lands devoted
to livestock, poultry, and/or swine raising are excluded from the Comprehensive Agrarian
Reform Program (CARP).

Thus, in May 1993, petitioner applied for the exemption/exclusion of its 316.0422-hectare
property. Meanwhile, on December 27, 1993, the Department of Agrarian Reform (DAR)
issued Administrative Order No. 9, Series of 1993 (DAR A.O. No. 9), setting forth rules and
regulations to govern the exclusion of agricultural lands used for livestock, poultry, and
swine raising from CARP coverage. Thus, on January 10, 1994, petitioner re-documented its
application pursuant to DAR A.O. No. 9.

Acting on the said application, the DARs Land Use Conversion and Exemption Committee
(LUCEC) of Region IV conducted an ocular inspection on petitioners property and arrived at
the following findings:

The LUCEC, thus, recommended the exemption of petitioners 316.0422-hectare property

from the coverage of CARP. Adopting the LUCEC's findings and recommendation, DAR
Regional Director Percival Dalugdug (Director Dalugdug) issued an Order dated June 27,
1994, exempting petitioners 316.0422-hectare property from CARP.

The Southern Pinugay Farmers Multi-Purpose Cooperative, Inc. (Pinugay Farmers),

represented by Timiano Balajadia, Sr. (Balajadia), moved for the reconsideration of the said
Order, but the same was denied by Director Dalugdug in his Order dated November 24,
1994.Subsequently, the Pinugay Farmers filed a letter-appeal with the DAR Secretary.

Correlatively, on June 4, 1994, petitioner filed a complaint for Forcible Entry against
Balajadia and company before the Municipal Circuit Trial Court (MCTC) of Teresa-Baras, Rizal,
docketed as Civil Case No. 781-T.The MCTC ruled in favor of petitioner, but the decision was
later reversed by the Regional Trial Court, Branch 80, of Tanay, Rizal. Ultimately, the case
reached the CA, which, in its Decision dated October 8, 1999, reinstated the MCTCs ruling,
ordering Balajadia and all defendants therein to vacate portions of the property covered by
TCT Nos. M-6013, M-8796, and M-8791. In its Resolution dated July 31, 2000, the CA held
that the defendants therein failed to timely file a motion for reconsideration, given the fact
that their counsel of record received its October 8, 1999 Decision; hence, the same became
final and executory.

In the meantime, R.A. No. 6657 was amended by R.A. No. 7881,which was approved on
February 20, 1995. Private agricultural lands devoted to livestock, poultry, and swine raising
were excluded from the coverage of the CARL.

On January 21, 1997, then DAR Secretary Ernesto D. Garilao issued an Order exempting from
CARP only 240.9776 hectares of the 316.0422 hectares previously exempted by Director
Dalugdug, and declaring 75.0646 hectares of the property to be covered by CARP.

On February 4, 2000, the Office of the President rendered a decision reinstating Order
declared the entire 316.0422-hectare property exempt from the coverage of CARP.

Consequently, petitioner sought recourse from the CA. the CA found that, based on the
documentary evidence presented, the property subject of the application for exclusion had
more than satisfied the animal-land and infrastructure-animal ratios under DAR A.O. No. 9.
The CA also found that petitioner applied for exclusion long before the effectivity of DAR A.O.
No. 9, thus, negating the claim that petitioner merely converted the property for livestock,
poultry, and swine raising in order to exclude it from CARP coverage. Hence, the instant
petition is hereby granted.

Finally, petitioners motion for reconsideration was denied by the CA.

ISSUE: Whether the land is exempted from CARL coverage?

HELD: The decision of the Court of Appeals is sustained.

POLITICAL LAW validity of the administrative order

In the case at bar, we find that the impugned A.O. is invalid as it contravenes the
Constitution. The A.O. sought to regulate livestock farms by including them in the coverage
of agrarian reform and prescribing a maximum retention limit for their ownership. However,
the deliberations of the 1987 Constitutional Commission show a clear intent to exclude, inter
alia,all lands exclusively devoted to livestock, swine and poultry-raising. The Court clarified
in the Luz Farms case that livestock, swine and poultry-raising are industrial activities and do
not fall within the definition of "agriculture" or "agricultural activity." The raising of livestock,
swine and poultry is different from crop or tree farming. It is an industrial, not an
agricultural, activity. A great portion of the investment in this enterprise is in the form of
industrial fixed assets, such as: animal housing structures and facilities, drainage, waterers
and blowers, feedmill 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, deepwells, elevated water tanks,
pump houses, sprayers, and other technological appurtenances.

Clearly, petitioner DAR has no power to regulate livestock farms which have been exempted
by the Constitution from the coverage of agrarian reform. It has exceeded its power in
issuing the assailed A.O.
G.R. No. 100091 October 22, 1992

CENTRAL MINDANAO UNIVERSITY REPRESENTED ITS PRESIDENT DR. LEONARDO A.

CHUA, petitioner,
vs.
THE DEPARTMENT OF AGRARIAN REFORM ADJUDICATION BOARD, THE COURT OF
APPEALS and ALVIN OBRIQUE, REPRESENTING BUKIDNON FREE FARMERS
AGRICULTURAL LABORERS ORGANIZATION (BUFFALO), respondents.

FACTS:
Petitioner Central Mindanao University is an Agricultural University which is devoted in
training people for the development of agricultural economy in Mindanao. Upon issuance of
Proclamation No. 476 , late president Carlos P Garcia reserves 3080 hectare of land area
devoted for the future campus of CMU. As the population of the students expanded,
educational facilities were improved by self help measures and by the government. A
livelihood program was approved by CMU known as Kilusang Sariling Sikap Program,
Resolution No. 160, Land resources were leased to its employees with a written contract
stating that faculty and staff should combine themselves to group of five members each.
They provided assistance to enable each group to cultivate 4-5 hectares of land for the low
land project. The contract restricts participants and their hired workers to establish houses
or live in the project area and to use the cultivated land as a collateral for any kind of loan. It
was expressly stated that landlord-tenant relationship existed between CMU and its
employees are not allowed.
Petitioner Dr. Leonardo Chua became president of the CMU in July 1986, the agri-business
was stopped due to losses incurred while carrying on the said project. Some CMU employees
were laid off upon the stoppage of the project. Obrique, a physics instructor and a
participant was found guilty of mishandling the CMU funds and was separated from service
by virtue of executive order no. 17, the re-organization law of the CMU.
Chua conducted a self help project called CMU-Income Enhancement Program which will
develop unutilized land resources, mobilize and promote the spirit of self-reliance, provide
socio-econimic and technical training field project implementation and augment the income
of the faculty and the staff.
A 3-party memorandum of agreement 2 was issued among the parties, the CMU, CMU-
IDF and groups of seldas of 5 CMU employees, the CMU would provide the use of 4-5
hectares of land to a selda for one calendar year. It is also expressly stated here that there
should be no tenant-landlord relationship in the agreement.
Only the current members and staff workers enjoys the CMU-IEP and not those who were
previous employees. But in the middle of 1987, they were allowed to participate as special
participants in order to cushion the impart of the discontinuance of the rice, corn, and sugar
cane project on the lives of its former workers.
The filing of the complaint was a result of the contract expirations, non-renewals,
discontinuance of the rice, corn, sugar cain project, loss of jobs due to termination,
harassment by school authorities.
DARAB found that the private repondents were not tenants and cannot therefore be
beneficiaries under the CARP. They also ordered the segragation of the 400 hectares of
suitable , compact and contiguous portions of the CMU land and their inclusion in the CARP
for distribution to qualified beneficiaries.
ISSUE: Whether or not the DARAB has jurisdiction to hear and decide Case No. 005 for
Declaration of Status of Tenants and coverage of land under CARP.
Whether or not respondent Court of Appeals committed serious errors and GADALEJ
in dismissing the Petition for Review on Certiorari and affirming the decision of DARAB
HELD:
We agree with the DARAB's finding that Obrique, et. al. are not tenants. Under
the terms of the written agreement signed by Obrique, et. al., pursuant to the livelihood
program called "KilusangSarilingSikap Program", it was expressly stipulated that no landlord-
tenant relationship existed between the CMU and the faculty and staff (participants in the
project). The CMU did not receive any share from the harvest/fruits of the land tilled by the
participants. What the CMU collected was a nominal service fee and land use participant's
fee in consideration of all the kinds of assistance given to the participants by the CMU.
In the same paragraph of their complaint, complainants claim that they are landless
peasants. This allegation requires proof and should not be accepted as factually true.
Obrique is not a landless peasant. The facts showed he was Physics Instructor at CMU
holding a very responsible position was separated from the service on account of certain
irregularities he committed while Assistant Director of the Agri-Business Project of cultivating
lowland rice. Others may, at the moment, own no land in Bukidnon but they may not
necessarily be so destitute in their places of origin. No proof whatsoever appears in the
record to show that they are landless peasants.
The evidence on record establish without doubt that the complainants were originally
authorized or given permission to occupy certain areas of the CMU property for a definite
purpose to carry out certain university projects as part of the CMU's program of activities
pursuant to its avowed purpose of giving training and instruction in agricultural and other
related technologies, using the land and other resources of the institution as a laboratory for
these projects. Their entry into the land of the CMU was with the permission and written
consent of the owner, the CMU, for a limited period and for a specific purpose. After the
expiration of their privilege to occupy and cultivate the land of the CMU, their continued stay
was unauthorized and their settlement on the CMU's land was without legal authority. A
person entering upon lands of another, not claiming in good faith the right to do so by virtue
of any title of his own, or by virtue of some agreement with the owner or with one whom he
believes holds title to the land, is a squatter. Squatters cannot enter the land of another
surreptitiously or by stealth, and under the umbrella of the CARP, claim rights to said
property as landless peasants. Under Section 73 of R.A. 6657, persons guilty of committing
prohibited acts of forcible entry or illegal detainer do not qualify as beneficiaries and may
not avail themselves of the rights and benefits of agrarian reform. Any such person who
knowingly and willfully violates the above provision of the Act shall be punished with
imprisonment or fine at the discretion of the Court. Therefore, private respondents, not
being tenants nor proven to be landless peasants, cannot qualify as beneficiaries under the
CARP.
The questioned decision of the Adjudication Board, affirmed by the Court of Appeals,
segregating 400 hectares from the CMU land is primarily based on the alleged fact that the
land subject is "not directly, actually and exclusively used for school sites, because the same
was leased to Philippine Packing Corporation (now Del Monte Philippines)".
In support of this view, the Board held that the "respondent University failed to show
that it is using actually, really, truly and in fact, the questioned area to the exclusion of
others, nor did it show that the same is directly used without any intervening agency or
person",and "there is no definite and concrete showing that the use of said lands are
essentially indispensable for educational purposes".The reliance by the respondents Board
and Appellate Tribunal on the technical or literal definition from Moreno's Philippine Law
Dictionary and Black's Law Dictionary, may give the ordinary reader a classroom meaning of
the phrase "is actually directly and exclusively", but in so doing they missed the true
meaning of Section 10, R.A. 6657, as to what lands are exempted or excluded from the
coverage of the CARP. The construction given by the DARAB to Section 10 restricts the
land area of the CMU to its present needs or to a land area presently, actively exploited and
utilized by the university in carrying out its present educational program with its present
student population and academic facility overlooking the very significant factor of growth of
the university in the years to come. By the nature of the CMU, which is a school established
to promote agriculture and industry, the need for a vast tract of agricultural land and for
future programs of expansion is obvious.It was in this same spirit that President Garcia
issued Proclamation No. 476, withdrawing from sale or settlement and reserving for the
Mindanao Agricultural College (forerunner of the CMU) a land reservation of 3,080 hectares
as its future campus. It was set up in Bukidnon, in the hinterlands of Mindanao, in order that
it can have enough resources and wide-open spaces to grow as an agricultural educational
institution, to develop and train future farmers of Mindanao and help attract settlers to that
part of the country.
The first land use plan of the CARP was prepared in 1975 and since then it has
undergone several revisions in line with changing economic conditions, national economic
policies and financial limitations and availability of resources. The CMU, through Resolution
No. 160 S. 1984, pursuant to its development plan, adopted a multi-disciplinary applied
research extension and productivity program called the "KilusangSarilingSikap Project"
(CMU-KSSP).
The portion of the CMU land leased to the Philippine Packing Corporation (now Del
Monte Phils., Inc.) was leased long before the CARP was passed. The agreement with the
Philippine Packing Corporation was not a lease but a Management and Development
Agreement, a joint undertaking where use by the Philippine Packing Corporation of the land
was part of the CMU research program, with the direct participation of faculty and students.
Said contracts with the Philippine Packing Corporation and others of a similar nature were
made prior to the enactment of R.A. 6657 and were directly connected to the purpose and
objectives of the CMU as an educational institution. As soon as the objectives of the
agreement for the joint use of the CMU land were achieved as of June 1988, the CMU
adopted a blue print for the exclusive use and utilization of said areas to carry out its own
research and agricultural experiments.
As to the determination of when and what lands are found to be necessary for use by
the CMU, the school is in the best position to resolve and answer the question and pass upon
the problem of its needs in relation to its avowed objectives for which the land was given to
it by the State. Neither the DARAB nor the Court of Appeals has the right to substitute its
judgment or discretion on this matter, unless the evidentiary facts are so manifest as to
show that the CMU has no real for the land.
It is our opinion that the 400 hectares ordered segregated by the DARAB and affirmed
by the Court of Appeals in its Decision dated August 20, 1990, is not covered by the CARP
becauase (1) It is not alienable and disposable land of the public domain;(2) The CMU land
reservation is not in excess of specific limits as determined by Congress;(3) It is private land
registered and titled in the name of its lawful owner, the CMU;(4) It is exempt from coverage
under Section 10 of R.A. 6657 because the lands are actually, directly and exclusively used
and found to be necessary for school site and campus, including experimental farm stations
for educational purposes, and for establishing seed and seedling research and pilot
production centers.
Under Section 4 and Section 10 of R.A. 6657, it is crystal clear that the jurisdiction of
the DARAB is limited only to matters involving the implementation of the CARP. It is
restricted to agrarian cases and controversies involving lands falling within the coverage of
the aforementioned program. It does not include those, which are actually, directly, and
exclusively used and found to be necessary for, among such purposes, school sites and
campuses for setting up experimental farm stations, research and pilot production centers.
Consequently, the DARAB has no power to try, hear and adjudicate the case pending
before it involving a portion of the CMU's titled school site, as the portion of the CMU land
reservation ordered segregated is actually, directly and exclusively used and found by the
school to be necessary for its purposes. The CMU has constantly raised the issue of the
DARAB's lack of jurisdiction and has questioned the respondent's authority to hear, try and
adjudicate the case at bar. Despite the law and the evidence on record tending to establish
that the fact that the DARAB had no jurisdiction, it made the adjudication now subject of
review.
In this case, DARAB found that the complainants are not share tenants or lease
holders of the CMU, yet it ordered the "segregation of a suitable compact and contiguous
area of Four Hundred hectares, more or less", from the CMU land reservation, and directed
the DAR Regional Director to implement its order of segregation. Having found that the
complainants in this agrarian dispute for Declaration of Tenancy Status are not entitled to
claim as beneficiaries of the CARP because they are not share tenants or leaseholders, its
order for the segregation of 400 hectares of the CMU land was without legal authority.
We do not believe that the quasi-judicial function of the DARAB carries with it greater
authority than ordinary courts to make an award beyond what was demanded by the
complainants/petitioners, even in an agrarian dispute. Where the quasi-judicial body finds
that the complainants/petitioners are not entitled to the rights they are demanding, it is an
erroneous interpretation of authority for that quasi-judicial body to order private property to
be awarded to future beneficiaries. The order segregation 400 hectares of the CMU land was
issued on a finding that the complainants are not entitled as beneficiaries, and on an
erroneous assumption that the CMU land which is excluded or exempted under the law is
subject to the coverage of the CARP. Going beyond what was asked by the complainants who
were not entitled to the relief prayed the complainants who were not entitled to the relief
prayed for, constitutes a grave abuse of discretion because it implies such capricious and
whimsical exercise of judgment as is equivalent to lack of jurisdiction.
The education of the youth and agrarian reform are admittedly among the highest
priorities in the government socio-economic programs. In this case, neither need give way to
the other. Certainly, there must still be vast tracts of agricultural land in Mindanao outside
the CMU land reservation which can be made available to landless peasants, assuming the
claimants here, or some of them, can qualify as CARP beneficiaries. To our mind, the taking
of the CMU land which had been segregated for educational purposes for distribution to yet
uncertain beneficiaries is a gross misinterpretation of the authority and jurisdiction granted
by law to the DARAB.
It is the opinion of the Court that the evidence is sufficient to sustain a finding of
grave abuse of discretion by respondents Court of Appeals and DAR Adjudication Board.
Declaring the decision of the DARAB dated September 4, 1989 and the decision of the Court
of Appeals dated August 20, 1990, affirming the decision of the quasi-judicial body, as null
and void and ordered to be set aside.

DAR v DECS

The subject land, lot 2509 and 817-D in Negros was donated by late Esteban Jalandoni to the
DECS with a transfer of title. For 10 agricultural crop years, 1984-1994, it was leased to
Anglo Agricultural Corporation, the contract was subsequently renewed for another ten
years starting crop year 1994-1995 until 2004- 2005.

In June 1993, a petition for Compulsory Agrarian Reform Program (CARP) coverage with the
MARO Escalante 5 was filed by Eugenio Alpar and others claiming to be permanent and
regular farm workers of the subject lands. After an investigation conducted by MARO Piosa,
respondents received a Notice of Coverage stating that the lands are now covered by the
CARP and inviting its representatives for a conference with the farmer beneficiaries.
The recommendation for coverage was approved by DAR regional director Dominador B.
Andres which states that: Respondents DECS appealed the case to the Secretary of Agrarian
Reform which affirmed the Order of the Regional Director. Respondents DECS filed a petition
for certiorari with the court of Appeals, which set aside the decision of the Secretary of the
Agrarian reform. Hence, the instant petition for review

ISSUE: Whether the subject properties are exempted from the coverage of CARL

HELD: No.

As respondent DECS sought exemption from CARP coverage on the ground that all the
income derived from its contract of lease with Anglo Agricultural Corporation were actually,
directly and exclusively used for educational purposes, such as for the repairs and
renovations of schools in the nearby locality, the court is inclined with the petitioners
argument that the lands subject hereof are not exempt from the CARP coverage because the
same are not actually, directly and exclusively used as school sites or campuses, as they are
in fact leased to Anglo Agricultural Corporation. Further, to be exempt from the coverage, it
is the land per se, not the income derived therefrom, that must be actually, directly and
exclusively used for educational purposes.
Section 10 of R.A. No. 6657 enumerates the types of lands which are exempted from the
coverage of CARP as well as the purposes of their exemption specifying those lands
actually, directly and exclusively used and found to be necessary for national defense,
school sites and campuses, including experimental farm stations operated by public or
private schools for educational purposes, , shall be exempt from the coverage of this Act.
Clearly, a reading of the paragraph shows that, in order to be exempt from the coverage: 1)
the land must be "actually, directly, and exclusively used and found to be necessary;" and 2)
the purpose is "for school sites and campuses, including experimental farm stations
operated by public or private schools for educational purposes."
BUKLOD NANG MAGBUBUKID SA LUPAING RAMOS, INC., VS. E. M. RAMOS AND
SONS, INC.
FACTS:
The case is about the petition for review filed by Buklod nang Magbubukid sa Lupaing
Ramos. Inc. on the of the Court of Appeals decision wherein it declared the parcels of land
owned by E.M. Ramos and Sons, Inc. (EMRASON) in Cavite exempt from the coverage of the
Comprehensive Agrarian Reform Program (CARP), thus, nullifying and setting aside the
Decision of the Office of the President.
Unirrigated properties were acquired by EMRASON from Manila Golf and Country Club for the
purpose of developing the same into a residential subdivision known as "Traveller's Life
Homes". The conversion of the property into a residential property as applied for by
EMRASON was approved by the Municipal Council of Dasmarinas Cavite pursuant to Republic
Act No. 2264, otherwise known as the "Local Autonomy Act", thru Municipal Ordinance No. 1
entitled "An Ordinance Providing Subdivision Regulation and Providing Penalties for Violation
Thereof. However, the actual implementation of the subdivision project suffered delay
because the property was mortgaged to, and the titles thereto were in the possession of, the
Overseas Bank of Manila, which during the period material was under liquidation. On June
15. 1988, Republic Act No. 6657, otherwise known as the Comprehensive Agrarian Reform
Law or CARL, took effect, ushering in a new process of land classification, acquisition and
distribution. Then came the Aquino government's plan to convert the tenanted neighboring
property of the National Development Company (NDC) into an industrial estate to be
managed through a joint venture scheme by NDC and the Marubeni Corporation. Part of the
overall conversion package called for providing the tenant-farmers, opting to remain at the
NDC property, with three hectares each. However, the size of the NDC property turned out to
be insufficient for both the demands of the proposed industrial project as well as the
government's commitment to the tenant-farmers. DAR eyed the properties of EMRASON to
cover for the additional needs of NDC, assailing that the conversion of the aforesaid
properties failed to comply with the mandatory requirements and conditions of Municipal
Ordinance Nos. 1 and 29-A, specifically, among others, the need for approval of the National
Planning Commission through the Highway District Engineer, and the Bureau of Lands
before final submission to the Municipal Council and Municipal Mayor, and there was a
certification of the Human Settlements Regulatory Commission (HSRC) in 1981 and the
Housing and Land Use Regulatory Board (HLRB) in 1992 that the property is agricultural.
Court of Appeals ruled in favor of EMRASON because the subject property was already
converted/classified as residential by the Municipality of Dasmarinas prior to the effectivity
of the CARL. CA reasoned mainly that the municipality, conformably with its statutory-
conferred local autonomy, had passed a subdivision measure, I.e., Ordinance No. 1, and had
approved in line thereto, through the medium of Ordinance No. 29-A, [EMRASON's]
application for subdivision, or with like effect approved the conversion/classification of the
lands in dispute as residential. However, DAR contested the decision and cited that the
subject property could be compulsorily acquired by the State from EMRASON and distributed
to qualified farmer-beneficiaries under the CARP since it was still agricultural land when the
CARP became effective on June 15, 1988. Ordinance Nos. 1 and 29-A, approved by the
Municipality of Dasmarinas on July 13, 1971 and July 9, 1972, respectively, did not reclassify
the subject property from agricultural to non-agricultural. The power to reclassify lands is an
inherent power of the National Legislature under Section 9 of Commonwealth Act No. 141,
otherwise known as the Public Land Act, as amended, which, absent a specific delegation,
could not be exercised by any local government unit (LGU). The Local Autonomy Act of 1959
- in effect when the Municipality of Dasmarinas approved Ordinance Nos. 1 and 29-A -
merely delegated to cities and municipalities zoning authority, to be understood as the
regulation of the uses of property in accordance with the existing character of the land and
structures. It was only Section 20 of Republic Act No. 7160, otherwise known as the Local
Government Code of 1991, which extended to cities and municipalities limited authority to
reclassify agricultural lands. Even conceding that cities and municipalities were already
authorized in 1972 to issue an ordinance reclassifying lands from agricultural to non-
agricultural, Ordinance No. 29-A of the Municipality of Dasmarinas was not valid since it
failed to comply with Section 3 of the Local Autonomy Act of 1959, Section 16(a) of
Ordinance No. 1 of the Municipality of Dasmarinas, and Administrative Order No. 152, which
all required review and approval of such an ordinance by the National Planning Commission
(NPC).
ISSUE:
The issue in this case is whether or not the subject property is subject to CARP.
HELD:
The Supreme Court ruled in favour of the decision of CA.
The aforesaid properties is not subject to CARP citing the provisions of Section 4, Chapter II
of the CARL, as amended concerning the coverage of CARL.
4. Scope. - The Comprehensive Agrarian Reform Law of 1988 shall cover, regardless of
tenurial arrangement and commodity produced, all public and private agricultural lands as
provided in Proclamation No. 131 and Executive Order No. 229, including other lands of the
public domain suitable for agriculture: Provided, That landholdings of landowners with a total
area of five (5) hectares and below shall not be covered for acquisition and distribution to
qualified beneficiaries. More specifically, the following lands are covered by the CARL: (d) All
private lands devoted to or suitable for agriculture regardless of the agricultural products
raised or that can be raised thereon. Section 3(c), Chapter I of the CARL further narrows
down the definition of agricultural land that is subject to CARL to "land devoted to
agricultural activity as defined in this Act and not classified as mineral, forest, residential,
commercial or industrial land."
The CARL took effect on June 15, 1988. To be exempt from the CARL, the subject property
should have already been reclassified as residential prior to said date. In addition, the Local
Autonomy Act impliedly provides power to the Local Government to Convert the
classification of Lands, which EMRASON has complied with. The Municipal Ordinance is a
valid exercise of police power by the local government unit.
Lastly, since the property is an unirrigated land, it is not subject to CARP.
CASE #11

REPUBLIC OF THE PHILIPPINES, represented by the DEPARTMENT OF AGRARIAN

REFORM, through the HON. SECRETARY NASSER C. PANGANDAMAN,
Petitioner,
- versus -

SALVADOR N. LOPEZ AGRI-BUSINESS CORP., represented by SALVADOR N. LOPEZ,

JR., President and General Manager,
Respondent.
x- - - - - - - - - - - - - - - - - - - - - xSALVADOR N. LOPEZ AGRI-BUSINESS CORP.,
represented by SALVADOR N. LOPEZ, JR., President and General Manager,
Petitioner,

G.R. No. 178895

January 10, 2011

FACTS:

Subject of this petition are four (4) parcels of land with an aggregate area of 160.1161
hectares registered in the name of Salvador N. Lopez Agri-Business Corporation. On 1991,
Municipal Agrarian Reform Officer (MARO) issued a Notice of Coverage to petitioner with
regards to the aforementioned landholdings which were subsequently placed under
Compulsory Acquisition pursuant to R.A. 6657.Petitioner filed with the Provincial Agrarian
Reform Office (PARO) an Application for Exemption, as the said parcels of land with a total
area of 110.5455 hectares are used for grazing and habitat of petitioners 105 heads of
cattle, 5 carabaos, 11 horses, 9 heads of goats and 18 heads of swine, prior to the effectivity
of the (CARL). The MARO then conducted an onsite investigation on the two parcels of land
confirming the presence of the livestock as enumerated.
The DAR Regional Director, after inspecting the properties, denied the application for
exemption of Lots 1454-A and 1296 on the ground that it was not clearly shown that the
same were actually, directly and exclusively used for livestock raising since in its application,
petitioner itself admitted that it needs the lots for additional grazing area, and such was
affirmed by the DAR on appeal. The application for exemption, however of the other two (2)
parcels of land was approved. The CA partially granted the SNLABC Petition and excluded
the two (2) parcels of land from coverage of the CARL. However, it upheld the Decisions of
the Regional Directorand the DAR Secretary denying the application for exemption with
respect to Lots 1454-A and 1296. These lots were already covered by a new title under the
name of the Republic of the Philippines (RP T-16356).

ISSUE:

Whether the subject lands of SNLABC can be considered grazing lands for its livestock
business and are thus exempted from the coverage of the CARL.

HELD:
In Luz Farms v. Secretary of the Department of Agrarian Reform,the Court declared
unconstitutional the CARL provisionsthat included lands devoted to livestock under the
coverage of the CARP. The transcripts of the deliberations of the Constitutional Commission
of 1986 on the meaning of the word "agricultural" showed that it was never the intention of
the framers of the Constitution to include the livestock and poultry industry in the coverage
of the constitutionally mandated agrarian reform program of the government. Thus, lands
devoted to the raising of livestock, poultry and swine have been classified as industrial, not
agricultural, and thus exempt from agrarian reform.
Under the rules then prevailing, it was the (MARO) who was primarily responsible for
investigating the legal status, type and areas of the land sought to be excluded;and for
ascertaining whether the area subject of the application for exemption had been devoted to
livestock-raising as of 15 June 1988. As the primary official in charge of investigating the
land sought to be exempted as livestock land, the MAROs findings on the use and nature of
the land, if supported by substantial evidence on record, are to be accorded greater weight,
if not finality.The Court generally accords great respect, if not finality, to factual findings of
administrative agencies because of their special knowledge and expertise over matters
falling under their jurisdiction.Hence, the Court looks with favor on the expertise of the
MARO in determining whether livestock-raising on the Lopez lands has only been recently
conducted or has been a going concern for several years already. Absent any clear showing
of grave abuse of discretion or bias, the findings of the MARO - as affirmed by the DAR
Regional Director - are to be accorded great probative value, owing to the presumption of
regularity in the performance of his official duties.

The Court finds that the Lopez lands of SNLABC are actually and directly being used for
livestock and are thus exempted from the coverage of the CARL while the Limot lands are
not actually and directly being used for livestock and thus, should be covered by the CARL.
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.

Facts:
On December 1988, SangguniangPanlalawigan of CamSur authorized 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.
Pursuant to the resolution, Gov. Villafuerte filed two separate cases for expropriation against
Ernesto San Joaquin and Efren San Joaquin. Upon motion for the issuance of writ or
possession, San Joaquins failed to appear at the hearing.

The San Joaquins later moved to dismiss the complaints on the ground of inadequacy of the
price offered for their property. The court denied the motion to dismiss and authorized the
province to take possession of the properties.
The San Joaquins filed for motion for relief, but denied as well. In their petition. Asked by the
CA, Solicitor General stated that there is no need for the approval of the president for the
province to expropriate properties, however, the approval of the DAR is needed to convert
the property from agricultural to non-agricultural (housing purpose).

The CA set aside the decision of the trial court suspending the possession and expropriation
of the property until the province has acquired the approval of DAR. Hence, this petition.

Issue:

Whether or not the expropriation of agricultural lands by the local government unit is subject
to the prior approval of the DAR Secretary.

Ruling:

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.

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.

G.R. No. 78214 December 5, 1988

YOLANDA CABALLES, petitioner,

vs.
DEPARTMENT OF AGRARIAN REFORM, HON. HEHERSON T. ALVAREZ and
BIENVENIDO ABAJON, respondents.

FACTS:
This is a petition for certiorari seeking the annulment of an Order issued by public
respondent Department of Agrarian Reform (DAR), through its then Secretary, the Hon.
Heherson Alvarez, finding the existence of a tenancy relationship between the herein
petitioner and the private respondent. The landholding subject of the controversy, which
consists of only sixty (60) square meters was acquired by the spouses Arturo and Yolanda
Caballes (petitioner), by virtue of a Deed of Absolute Sale dated July 24, 1978 executed by
Andrea AlicabaMillenes. This landholding is part of Lot No. 3109-C, which has a total area of
about 500 square meters, situated at Lawa-an, Talisay, Cebu. In 1975, before the sale in
favor of the Caballes spouses, private respondent BienvenidoAbajon constructed his house
on a portion of the said landholding, paying a monthly rental of 2.00 to the owner, Andrea
Millenes. The landowner likewise allowed Abajon to plant on a portion of the land, agreeing
that the produce thereof would be shared by both on a fifty-fifty basis. Abajon planted corn
and bananas on the landholding. For four years, he paid the 2.00 rental for the lot occupied
by his house, and delivered 50% of the produce to the owner. As the property was sold, the
new owners asked Abajon to vacate the premises, saying they needed the property, but
Abajon refused. On April 1, 1982, Yolanda Caballes, executed an Affidavit stating that
immediately after she reprimanded Abajon for harvesting bananas and jackfruit from the
property without her knowledge, the latter, with malicious and ill intent, cut down the
banana plants on the property worth about 50.00. A criminal case for malicious mischief
was filed against Abajon. (Obviously, all the planting on the property, including that of the
banana plants, had been done by Abajon). Upon motion of the respondent in open court, the
trial court ordered the referral of the case to the Regional Office of the Public Respondent for
a preliminary determination of the relationship between the parties. The Regional Director of
DAR held that there is the existence of a tenancy relationship between the parties. On
appeal by the petitioner, the Secretary of DAR, reversed the decision of the Regional
Director. Upon motion for reconsideration filed by the private respondent, the New DAR
Secretary sets aside the previous decision and finds the existence of a tenancy relationship
between the parties.

ISSUE:
Whether or not there is an existence of a tenancy relationship between the parties.

HELD:
There is none. The Higher Court laid down the essential requisites of a tenancy relationship.
All requisites must concur in order to create a tenancy relationship between the parties. The
absence of one does not make an occupant of a parcel of land, or a cultivator thereof, or a
planter thereon, a de jure tenant. The fact of sharing alone is not sufficient to establish a
tenancy relationship. This does not automatically make the tiller-sharer a tenant thereof
especially when the area tilled is only 60 square meters and located in an urban area and in
the heart of an industrial or commercial zone. Tenancy status arises only if an occupant of a
parcel of land has been given its possession for the primary purpose of agricultural
production. The circumstances of this case indicate that the private respondent's status is
more of a caretaker who was allowed by the owner out of benevolence or compassion to live
in the premises and to have a garden of some sort rather than a tenant. Agricultural
production as the primary purpose being absent in the arrangement is a clear proof that the
private respondent was never a tenant.

G.R. No. 86186 May 8, 1992

RAFAEL GELOS, petitioner,

vs.
THE HONORABLE COURT OF APPEALS and ERNESTO ALZONA, respondents.

Facts:
Rafael Gelos was employed by Ernesto Alzona and his parents as their laborer on a 25,000-
sq. m farmland. They executed a written contract which stipulated that as hired laborer
Gelos would receive a daily wage of P5.00. Three (3) years later, Gelos was informed of the
termination of his services and was asked to vacate the property. Gelos refused and
continued working on the land. Alzona filed a complaint for illegal detainer. The lower court
found Gelos as tenant of the property and entitled to remain thereon as such. The decision
was reversed by the Court of Appeals. DHACES
Issue:
What is the nature of the contract between Gelos and Alzona?
Held:
The parties entered into a contract of employment, not a tenancy agreement.It was clear
that the petitioner were not intended to be tenant but a mere employee of the private
respondent as showed in the contract. The petitioner was paid for specific kind of work. The
court stressed many cases that:
"tenancy is not a purely factual relationship dependent on what the alleged tenant does
upon the land. It is also a legal relationship. The intent of the parties, the understanding
when the farmer is installed, and as in this case, their written agreements, provided these
are complied with and are not contrary to law, are even more important."
It should also be considered that a tenant is defined under Section 5(a) R.A 1199 as a
person who himself and with the aid available from within his immediate farm household
cultivates the land belonging to or possessed by another, with the latter's consent, for
purposes of production, sharing the produce with the landholder under the share tenancy
system, or paying to the landholder a price-certain or ascertainable in produce or in money
or both, under the leasehold tenancy system.
Therefore the court laid down the requisites for the tenancy relationship to exist:
1) The parties are the landowner and the tenant;
2) The subject is agricultural land;
3) There is consent;
4) The purpose is agricultural production;
5) There is personal cultivation; and
6) There is sharing of harvest or payment of rental.
Absence of this clearly does not qualify someone to be a tenant. It is clear that it is not a
tenancy relationship that exists between the parties, what they have is employee-employer
relationship.

G.R. No. L-27797 August 26, 1974

TRINIDAD GABRIEL, plaintiff-appellee,

vs.
EUSEBIO PANGILINAN, defendant-appellant.

Mariano Manahan, Jr. for plaintiff-appellee.

Trinidad Gabriel filed a complaint against EusebioPangilinan claiming she is the owner of a
169,507 sq. m. fishpond in barrio Sta. Ursula, Pampanga. An oral contract of lease with a
yearly rental was entered between them. Defendant was notified that the contract would be
terminated, but upon request was extended for another year.
Defendant moved for the dismissal of the complaint claiming that the trial court had no
jurisdiction. It should properly pertain to the Court of Agrarian Relations, there being an
agricultural leasehold tenancy relationship between the parties. Upon opposition by plaintiff,
the motion was denied. The defendant filed his answer that the land was originally verbally
leased to him by the plaintiff's father, Potenciano for as long as the defendant wanted,
subject to the condition that he would convert the major portion into a fishpond and that
which was already a fishpond be improved at his expense, which would be reimbursed by
Potenciano Gabriel or his heirs at the termination of the lease. Plaintiff also assured him that
he could continue leasing as long as he wanted since she was not in a position to attend to it
personally.
The trial court rendered a decision stating that the the lease contract is a civil lease
governed by the New Civil Code. No tenancy relationship exists between the plaintiff and the
defendant as defined by Republic Act No. 1199. Court is vested with jurisdiction to try and
decide this case. Motion for Reconsideration by the defendant was denied. He appealed to
this Court.
ISSUES:
Whether or not the relationship of plaintiff and defendant was that of a civil lease and not a
leasehold tenancy under Rep. Act No. 1199 as amended.

HELD:
There are important differences between a leasehold tenancy and a civil law lease. The
leasehold tenancy is limited to agricultural land; that of civil law lease may be either rural or
urban property. As to attention and cultivation, the law requires the leasehold tenant to
personally attend to, and cultivate the agricultural land, whereas the civil law lessee need
not personally cultivate or work the thing leased. As to purpose, the landholding in leasehold
tenancy is devoted to agriculture, whereas in civil law lease, the purpose may be for any
other lawful pursuits. As to the law that governs, the civil law lease is governed by the Civil
Code, whereas leasehold tenancy is governed by special laws.
The requisites for leasehold tenancy under the Agricultural Tenancy Act to exist:
1. The land worked by the tenant is an agricultural land;
2. The land is susceptible of cultivation by a single person together with members of his
immediate farm household;
3. Theremust be cultivated by the tenant either personally or with the aid of labor available
from members of his immediate farm household;
4. The land belongs to another; and
5. The use of the land by the tenant is for a consideration of a fixed amount in money or in
produce or in both

There is no doubt that the land is agricultural land. It is a fishpond and the Agricultural
Tenancy Act, which refers to "agricultural land", specifically mentions fishponds and
prescribes the consideration for the use thereof. The mere fact that a person works an
agricultural land does not necessarily make him a leasehold tenant within the purview of Sec
4 of Republic Act No. 1199. He may still be a civil law lessee unless the other requisites as
above enumerated are complied with.
The court doesnt want to decide on the second requisite since it wasnt raised. For the third
requisite, the tenancy agreement was severed in 1956 when he ceased to work the fishpond
personally because he became ill and incapacitated. Not even did the members of
appellant's immediate farm household work the land. Only the members of the family of the
tenant and such other persons, whether related to the tenant or not, who are dependent
upon him for support and who usually help him to operate the farm enterprise are included
in the term "immediate farm household".
Republic Act No. 1199 is explicit in requiring the tenant and his immediate family to work the
land. A person, in order to be considered a tenant, must himself and with the aid available
from his immediate farm household cultivate the land. Persons, therefore, who do not
actually work the land cannot be considered tenants; and he who hires others whom he
pays for doing the cultivation of the land, ceases to hold, and is considered as having
abandoned the land as tenant within the meaning of sections 5 and 8 of Republic Act. No.
1199, and ceases to enjoy the status, rights, and privileges of one.
We are, therefore, constrained to agree with the court a quo that the relationship between
the appellee Trinidad Gabriel and appellant Eusebio Pangilinan was not a leasehold tenancy
under Republic Act No. 1199. Hence, this case was not within the original and exclusive
jurisdiction of the Court of Agrarian Relations.
IN VIEW OF THE FOREGOING, the decision of the Court of First Instance of Pampanga in its
Civil Case No. 1823, appealed from, is affirmed, with costs against the appellants.
Chamber of Real Estate and Builders Association, Inc. (CREBA) VS Secretary of
Agrarian Reform
Facts:
The Secretary of Agrarian Reform issued DAR AO No. 07-97 entitled "Omnibus Rules and
Procedures Governing Conversion of Agricultural Lands to Non-Agricultural Uses,". The AO
consolidates all existing implementing guidelines related to land use conversion. The rules
embraces all private agricultural lands regardless of tenurial arrangement and commodity
produced, and all untitled agricultural lands and agricultural lands reclassified by Local
Government Units (LGUs) into non-agricultural uses. In addition, he amended the following
issuances under AO No. 07-97 to widen its coverage to wit: (1) those to be converted to
residential, commercial, industrial, institutional and other non-agricultural purposes; (2)
those to be devoted to another type of agricultural activity such as livestock, poultry, and
fishpond the effect of which is to exempt the land from the Comprehensive Agrarian
Reform Program (CARP) coverage; (3) those to be converted to non-agricultural use other
than that previously authorized; and (4) those reclassified to residential, commercial,
industrial, or other non-agricultural uses on or after the effectivity of Republic Act No.
6657.On15 April 2008 the DAR Secretary issued a memorandum which temporarily
suspended the processing and approval of all land use conversion applications. The issuance
resulted to the slowing down of housing projects which, in turn, aggravated the housing
shortage, unemployment and illegal squatting problems to the substantial prejudice to the
petitioner and its members. Hence this petition for certiorari and prohibition no nullify the
enforcement of DAR AOs.
The issues of the case are as follows:

I. Whether the DAR secretary has jurisdiction over lands that have been reclassified
as residential, commercial, industrial, or for other non-agricultural uses.

II. Whether the DAR secretary acted in excess of his jurisdiction and gravely abused
his discretion by issuing and enforcing [DAR ao no. 01-02, as amended] which
seek to regulate reclassified lands.

Held:
DAR has no jurisdiction over lands that have been reclassified as residential, commercial,
industrial, or for other non-agricultural uses because they are covered by RA 6657 and RA
8435. There is no provision under the aforesaid RAs that DAR has the jurisdiction or authority
to require non-awarded lands or reclassified lands to be submitted to DARs conversion
authority. In addition, DARs AO violates the provisions of the Local Government Code for the
conversion of lands, it usurps the powers vested among the LGU by the Local Government
Code. Lastly, there is deprivation of liberty and property without due process of law because
under DAR AO No. 01-02 lands that are not within its jurisdiction are being affected hence,
other sectors excluding the agricultural sector are being unjustly enriched while the other
sectors such as the residential and commercial sectors suffer.
Sta Rosa Realty Development Corporation VS CA
Facts: The case is about a petition for review on certiorari filed by the Sta. Rosa Realty
Development Corporation (SRRDC) against the decision of the Court of Appeals, affirming
the decision of the Department of Agrarian Reform Adjudication Board (DARAB) for the order
of the compulsory acquisition of SRRDCs property under the Comprehensive Agrarian
Reform Program (CARP). SDRRC was the registered owner of two parcels of land, situated at
Barangay Casile, Cabuyao, Laguna covered by TCT Nos. 81949 and 84891, with a total area
of 254.6 hectares. According to SDRRC, the parcels of land are watersheds, which provide
clean potable water to the Canlubang community, and that ninety (90) light industries are
now located in the area. The problem arose when Amante, et al usurped its rights over the
property, hence destroying the ecosystem. Amante , et al. Filed a civil case with the RTC
seeking an easement of a right of way to and from Brgy. Casile, however as a counterclaim,
SRRDC sought for the ejectment of Amante, et al. After SRRDC filed a case of ejectment,
Amante et al. Went to DAR for the compulsory acquisition of the SRRDC property under the
CARP.
On August 11, 1989, the Municipal Agrarian Reform Officer (MARO) of Cabuyao, Laguna
issued a notice of coverage to petitioner and invited its officials or representatives to a
conference on August 18, 1989. During the meeting, the following were present:
representatives of petitioner, the Land Bank of the Philippines, PARCCOM, PARO of Laguna,
MARO of Laguna, the BARC Chairman of Barangay Casile and some potential farmer
beneficiaries, who are residents of Barangay Casile, Cabuyao, Laguna. It was the consensus
and recommendation of the assembly that the landholding of SRRDC be placed under
compulsory acquisition.

SRRDC filed with the MARO, Cabuyao, Laguna a Protest and Objection to the compulsory
acquisition of the property on the ground that the area was not appropriate for agricultural
purposes. The area was rugged in terrain with slopes of 18% and above and that the
occupants of the land were squatters, who were not entitled to any land as beneficiaries.
However, the farmer beneficiaries together with the BARC chairman answered the protest
and objection stating that the slope of the land is not 18% but only 5-10% and that the land
is suitable and economically viable for agricultural purposes, as evidenced by the
Certification of the Department of Agriculture, municipality of Cabuyao, Laguna.

DARAB proceeded with the valuation of the properties to determine the just
compensation of the properties. Wherein SRRDC contested and said that they have a
pending conversion to a watershed area and was subject to land conversion. However
DARAB ordered that the Land Bank of the Philippines (LBP) should pay SRRDC the amount of
P7,841,997.64 for its 2 parcels of land. Should there be a rejection of the payment tendered,
to open, if none has yet been made, a trust account for said amount in the name of Sta.
Rosa Realty Development Corporation.

The issue in this case is whether the subject parcels of land fall within the coverage of
the Compulsory Acquisition Program of the CARP.

No. The properties are not subject to CARP.

Under Section 10 of RA 6657:
Section 10. Exemptions and Exclusions. Lands actually, directly and exclusively used and
found to be necessary for parks, wildlife, forest reserves, reforestration, fish sanctuaries and
breeding grounds, watersheds and mangroves, national defense, school sites and
campuses including experimental farm stations operated by public or private schools for
educational purposes, seeds and seedlings research and pilot production centers, church
sites and convents appurtenent thereto, communal burial grounds and cemeteries, penal
colonies and penal farms actually worked by the inmates, government and private research
and quarantine centers, and all lands with eighteen percent (18%) slope and over,
except those already developed shall be exempt from coverage of this Act.

In line with this, it was proven that during the hearing at DARAB, there was proof
showing that the disputed parcels of land may be excluded from the compulsory acquisition
coverage of CARP because of its very high slopes.

In addition, the fact that the procedure for the just compensation was not met, since the law
required payment in cash or LBP bonds, not by trust account as was done by DAR. It was, in
a way, usurpation of powers for DAR.
Lastly, the area owned by SRRDC forms a vital part of an area that need to be protected for
watershed purposes, hence, the SC ruled out that even if the classification of the property is
not as a watershed, it is an indispensable part of the watershed per se, the problem was
with the classification issued by DENR on why the said properties did not form part of the
watershed.
Jose Luis Ros, et. al. vs. Department of Agrarian Reform
GR No. 132477, August 31, 2005

Facts:
Petitioners are the owners/developers of several parcels of land located in Arpili, Balamban,
Cebu. By virtue of Municipal Ordinance No. 101 passed by the Municipal Council of
Balamban, Cebu, These lands were reclassified as industrial lands. On April 3, 1995, the
Provincial Board of Cebu approved Balambans land use plan and adopted en toto Balambans
Municipal Ordinance No. 101 with the passage of Resolution No. 836-95 and Provincial
Ordinance No. 95-8, respectively. DAR prepared a development plan for the subject lands as
an industrial park, petitioners secured the permits and certifications. Thereafter, a letter was
received by one of the petitioners from the Director of DAR informing him that DAR was
disallowing the conversion of the subject lands for industrial use. Then, petitioners filed a
complaint for Injunction before the Regional Trial Court (RTC) of Telodo City. RTC rendered a
decision (RTC order) dismissing the complaint for having no jurisdiction over the same.
Subsequently, petitioners filed a petition before the Court of Appeals (CA), however, CA
affirmed the RTC order. Hence, petitioners filed with the Supreme Court.

Issues:
Whether or not the reclassification of the subject lands to industrial use by the Municipality
of Balamban, Cebu pursuant to its authority under Section 20 (a) of RA 7160 or the LGC
1991 has the effect of taking such lands out of the coverage of the CARL and beyond the
jurisdiction of the DAR?
Whether or not the Complaint for Injunction is an appropriate remedy against the order of
the DAR enjoining development works on the subject lands?

Held:
The Comprehensive Agrarian Reform Program (RA 6657) states that agricultural lands,
though reclassified, have to go through the process of conversion, jurisdiction over which is
vested in the DAR. However, agricultural lands already reclassified before the effectivity of
RA 6657 are exempted from conversion. The authority of the DAR to approve conversion of
the agricultural lands covered by RA 6657 to non-agricultural uses has not been pierced by
the passage of the LGC. It was provided that nothing in this section shall be construed as
repealing or modifying in any manner the provisions of RA 6657.

It is being settled that jurisdiction over conversion of land is vested in the DAR, the
complaint was correctly dismissed by the RTC and appellate courts under the doctrine of
primary jurisdiction. The primary jurisdiction precludes the courts from resolving a
controversy over which jurisdiction has initially been lodged with an administrative body of
special competence. Under RA 6657, the DAR retains jurisdiction over all agrarian reforms
matters. Pursuant to Sec. 50 of the RA 6657, the DAR is hereby vested with the primary
jurisdiction to determine and adjudicate agrarian reform matters and shall have exclusive
original jurisdiction over all matters involving the implementation of agrarian reform. In Sec.
68 the same act states that no injunction, restraining order, prohibition or mandamus shall
be issued by the lower courts against the DAR, xxx. Hence, the Petition is denied for lack of
merit.
Chamber of Real Estate and Builders Associations, In. (CREBA) vs. The Secretary
of Agrarian Reform
G.R. No. 183409 June 18, 2010

Facts:
On October 29, 1997, the Secretary of Agrarian Reform (SAR) issued an Omnibus Rules and
Procedures Governing Conversion of Agricultural Lands to Non-Agricultural Uses (DAR AO No.
07-97) which consolidated all existing implementing guidelines related to land use
conversion. On March 30, 1999, SAR issued a Revised Rules and Regulations on the
Conversion of Agricultural Lands to Non-agricultural Uses (DAR AO No. 01-99) and
subsequently issued another Administrative Order entitled 2002 Comprehensive Rules and
Land Use Conversion (DAR AO No. 01-02) which amended DAR AO No. 07-97 and DAR AO
No. 01-99. On April 15, 2008, SAR issued Memorandum No. 88 which temporarily suspended
the processing and approval of all land use conversion applications. Petitioner claims that
there is an actual slow down of housing projects, which in turn aggravated the housing
storage the housing shortage, unemployment and illegal squatting problems. Petitioner
holds that under R.A. No. 6657, the term agricultural lands refer to lands devoted to or
suitable for the cultivation of the soil, planting crops, xxx. Petitioner contended that DAR AO
No. 01-02, was made in violation of Sec. 65 of RA. No. 6657 because it covers all applications
for conversion from agricultural to non-agricultural uses. Petitioner avers that the
promulgation and enforcement of DAR AO No. 01-02 constitutes deprivation of liberty and
property without due process of law.

Issues:
Whether or not DARs AO entitled Omnibus Rules and Procedures Governing Conversion of
Agricultural Lands to Non Agricultural Uses is unconstitutional?

Held:
RA 6657 and 8435 defines agricultural land as lands devoted to or suitable for the cultivation
of the soil, planting of crops, growing of fruit trees, raising of livestock, poultry or fish,
including the harvesting of such farm products, and other farm activities and practices
performed by a farmer in conjunction with such farming operations done by a person
whether natural or juridical, and not classified by the law as mineral, forest, residential,
commercial or industrial land. However, he issued an AO included in this definition - lands
not reclassified as residential, commercial, industrial or other non-agricultural uses before 15
June 1988. In effect, lands reclassified from agricultural to residential, commercial, industrial,
or other non-agricultural uses after 15 June 1988 are considered to be agricultural lands for
purposes of conversion, redistribution, or otherwise. This is violation of RA 6657 because
there is nothing in Section 65 of Republic Act No. 6657 or in any other provision of law that
confers to the DAR the jurisdiction or authority to require that non-awarded lands or
reclassified lands be submitted to its conversion authority. It also violates Section 20 of
Republic Act No. 7160, because it was not provided therein that reclassification by LGUs
shall be subject to conversion procedures or requirements, or that the DARs approval or
clearance must be secured to effect reclassification. The said Section 2.19 of DAR AO No. 01-
02, as amended, also contravenes the constitutional mandate on local autonomy under
Section 25, Article II and Section 2, Article X of the 1987 Philippine Constitution. There is
deprivation of liberty and property without due process of law because under DAR AO No.
01-02, as amended, lands that are not within DARs jurisdiction are unjustly, arbitrarily and
oppressively prohibited or restricted from legitimate use on pain of administrative and
criminal penalties. More so, there is discrimination and violation of the equal protection
clause of the Constitution because the aforesaid administrative order is patently biased in
favor of the peasantry at the expense of all other sectors of society.
Fortich vs Corona 398 SCRA 685
Posted on December 6, 2012
100 SCAD 781
298 SCRA 685
1998

The Office of the President modified its decision which had already become final and
executory.

FACTS:
On November 7, 1997, the Office of the President (OP) issued a win-win Resolution which
reopened case O.P. Case No. 96-C-6424. The said Resolution substantially modified its March
29, 1996 Decision. The OP had long declared the said Decision final & executory after the
DARs Motion for Reconsideration was denied for having been filed beyond the 15-day
reglementary period.
The SC then struck down as void the OPs act, it being in gross disregard of the rules & basic
legal precept that accord finality to administrative determinations.
The respondents contended in their instant motion that the win-win Resolution of
November 7, 1997 is not void since it seeks to correct an erroneous ruling, hence, the
March 29, 1996 decisioncould not as yet become final and executory as to be beyond
modification. They further explained that the DARs failure to file their Motion for
Reconsideration on time was excusable.

ISSUE:
Was the OPs modification of the Decision void or a valid exercise of its powers and
prerogatives?
1. Whether the DARs late filing of the Motion for Reconsideration is excusable.
2. Whether the respondents have shown a justifiable reason for the relaxation of rules.
3. Whether the issue is a question of technicality.

HELD:
1.
No.
Sec.7 of Administrative Order No. 18, dated February 12, 1987, mandates that
decisions/resolutions/orders of the Office of the President shallbecome final after the lapse
of 15 days from receipt of a copy therof xxx unless a Motion for Reconsideration thereof is
filed within such period.
The respondents explanation that the DARs office procedure made it impossibleto file its
Motion for Reconsideration on time since the said decision had to be referred to its different
departments cannot be considered a valid justification. While there is nothing wrong with
such referral, the DAR must not disregard the reglementary period fixed by law, rule or
regulation.
The rules relating to reglementary period should not be made subservient to the internal
office procedure of an administrative body.

2.
No. The final & executory character of the OP Decision can no longer be disturbed or
substantially modified. Res judicata has set in and the adjudicated affair should forever be
put to rest.
Procedural rules should be treated with utmost respect and due regard since they are
designed to facilitate the adjudication of cases to remedy the worsening problem of delay in
the resolution of rival claims and in the administration of justice. The Constitution
guarantees that all persons shall have a right to the speedy disposition of their cases
before all judicial, quasi-judicial and administrative bodies.
While a litigation is not a game of technicalities, every case must be prosecuted in
accordance with the prescribed procedure to ensure an orderly & speedy administration of
justice. The flexibility in the relaxation of rules was never intended to forge a bastion for
erring litigants to violate the rules with impunity.
A liberal interpretation & application of the rules of procedure can only be resorted to in
proper cases and under justifiable causes and circumstances.

3.
No. It is a question of substance & merit.
A decision/resolution/order of an administrative body, court or tribunal which is declared void
on the ground that the same was rendered Without or in Excess of Jurisdiction, or with Grave
Abuse of Discretion, is a mere technicality of law or procedure. Jurisdiction is an essential
and mandatory requirement before a case or controversy can be acted on. Moreover, an act
is still invalid if done in excess of jurisdiction or with grave abuse of discretion.
In the instant case, several fatal violations of law were committed. These grave breaches of
law, rules & settled jurisprudence are clearly substantial, not of technical nature.

When the March 29, 1996 OP Decision was declared final and executory, vested rights were
acquired by the petitioners, and all others who should be benefited by the said Decision.
In the words of the learned Justice Artemio V. Panganiban in Videogram Regulatory Board vs
CA, et al., just as a losing party has the right to file an appeal within the prescribed period,
the winning party also has the correlative right to enjoy the finality of the resolution of
his/her case.