Daez vs. Court of Appeals (325 SCRA 856) it ruled in favor of Daez.
it ruled in favor of Daez. Aggrieved, the private respondents sought a review
Topic: Section 6 of RA 6657
Facts:
Daez and her husband declared, in the affidavit they executed, ownership over
41.8 hectares of agricultural lands and 14 hectares of Riceland 16 hectares of
forestland and 10 hectares of “batuhan” and 1.8 hectares of residential lands.
The 4.1 of 14 hectares of Riceland which is being cultivated by the
respondents Soriente Macatulad, Mediana and Umali under sa system of
shared-tenancy was subjected to the “Operation Land Transfer Program”
under PD 27 as amended by LOI 474.
The Ministry of Agrarian reform acquired the subject Riceland and issued
Certificates of Land Transfer (CLT) to respondents as beneficiaries. In 1981,
respondents signed an affidavit, allegedly under duress, stating that they are
hired laborers not shared-tenants. Daez, armed with such document applied
for the exemption of said Riceland from PD 27’s coverage due to non-tenancy
and for the cancellation of the CLTs issued.
The DAR Undersecretary denied Daez’s application for exemption upon
finding that her subject land is covered under the LOI 474 because of her
ownership of agricultural lands exceeding 7 hectares.
In a request for reconsideration, the DAR Secretary affirmed the assailed order
upon finding that respondents are bona fide tenants of the subject land and
that the affidavit executed by them were made under duress.
The Court of Appeals sustained the DAR Secretary’s decision and upon
pursuing her petition before the SC, the same was denied as well as the
subsequent MR.
In 1992, DAR issued Emancipation Patents to private respondents which they
later presented with the Register of Deeds. Eventually they were issued TCTs.
Daez filed an application for retention of the same Riceland this time under RA
6657. The DAR Director allowed retention of Riceland but denied the
application of her 8 children to retain 3 hectares each for their failure to prove
actual tillage of the land or its direct management. The DAR Secretary set aside
the order of DAR’s Director. On appeal before the Office of the President (OP),
of the decision before the CA which reversed the OP’s decision.
Issue: W/N the heirs of Eudosia Daez may exercise their right of retention over
the 4.1 hectares of Riceland.
Ruling: Yes. The right of retention is a constitutionally guaranteed right which
is subject to qualification by the legislature. It serves to mitigate the effects of
compulsory land acquisition by balancing the rights of the land owner and the
tenant and by implementing the doctrine that social justice was not meant to
perpetrate an injustice against the landowner.
In the landmark case of Association of Small Landowners of the Phils vs. Sec.
of Agrarian reform, the Court held that landowners who have not yet exercised
their retention rights under PD 27 are entitled to new retention under RA
6657.
Sec 6 of RA 6654 reads:
SECTION 6. Retention Limits. — Except as otherwise provided in this Act, no
person may own or retain, directly or indirectly, any public or private
agricultural land, the size of which shall vary according to factors governing a
viable family-size farm, such as commodity produced, terrain, infrastructure,
and soil fertility as determined by the Presidential Agrarian Reform Council
(PARC) created hereunder, but in no case shall retention by the landowner
exceed five (5) hectares.
Three (3) hectares may be awarded to each child of the landowner, subject to
the following qualifications: (1) that he is at least fifteen (15) years of age; and
(2) that he is actually tilling the land or directly managing the farm: Provided,
That landowners whose lands have been covered by Presidential Decree No. 27
shall be allowed to keep the areas originally retained by them thereunder:
Provided, further, That original homestead grantees or their direct compulsory
heirs who still own the original homestead at the time of the approval of this
Act shall retain the same areas as long as they continue to cultivate said
homestead.
The right to choose the area to be retained, which shall be compact or
contiguous, shall pertain to the landowner: Provided, however, That in case the
area selected for retention by the landowner is tenanted, the tenant shall have
the option to choose whether to remain therein or be a beneficiary in the same hereby REINSTATED. In the implementation of said decision, the Dept. of
or another agricultural land with similar or comparable features. In case the Agrarian Reform is hereby ORDERED to fully accord private respondents their
tenant chooses to remain in the retained area, he shall be considered a rights under Section 6 RA 6657.
leaseholder and shall lose his right to be a beneficiary under this Act. In case
the tenant chooses to be a beneficiary in another agricultural land, he loses his
right as a leaseholder to the land retained by the landowner. The tenant must
exercise this option within a period of one (1) year from the time the landowner
manifests his choice of the area for retention. In all cases, the security of tenure
of the farmers or farmworkers on the land prior to the approval of this Act shall
be respected.

Upon the effectivity of this Act, any sale, disposition, lease, management,
contract or transfer of possession of private lands executed by the original
landowner in violation of the Act shall be null and void: Provided, however, That
those executed prior to this Act shall be valid only when registered with the
Register of Deeds within a period of three (3) months after the effectivity of this
Act. Thereafter, all Registers of Deeds shall inform the Department of Agrarian
Reform (DAR) within thirty (30) days of any transaction involving agricultural
lands in excess of five (5) hectares.

Section 6 of RA 6657 defines the nature and incidents of a landowner’s right

of retention. For a long as the area retained is compact or contiguous and it
does not exceed the retention ceiling of 5 hectares, a landowner’s choice of
the area to be retained must prevail. Admin Order No.4 series of 1991 likewise
recognizes no limit to the prerogative of the land owner.

Without doubt, this right of retention may be exercised over tenanted land
despite the issuance of CLT to farmer-beneficiaries. What must be protected is
the right of the tenants to opt to either stay on the land chosen to be retained
by the landowner or be a beneficiary in another agricultural land with similar or
comparable features.

In the instant case, the CLTs of private respondents were issued without Daez’s
having been accorded her right of choice as to what to remain among her
landholdings. The TCTs thus issued on the basis of those CLTs cannot operate
to defeat the right of the heirs of deceased Eudosia Daez to retain the 4.1
hectares of Riceland.

WHEREFORE, the instant petition is hereby GRANTED. The decision of the CA

is REVERSED and SET ASIDE and the Decision of the Office of the President is