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MARCH 2011]
 HACIENDA LUISITA V PARC [G.R. NO. 171101. 24 APRIL 2012]

SECTION 17 – RA 6657
SECTION 17. Determination of Just Compensation. — In determining just compensation, the
cost of acquisition of the land, the current value of like properties, its nature, actual use and
income, the sworn valuation by the owner, the tax declarations, and the assessment made by
government assessors shall be considered. The social and economic benefits contributed by the
farmers and the farmworkers and by the Government to the property as well as the non-payment
of taxes or loans secured from any government financing institution on the said land shall be
considered as additional factors to determine its valuation.

SECTION 73. Prohibited Acts and Omissions. — The following are prohibited:

The ownership or possession, for the purpose of circumventing the provisions of this Act, of
agricultural lands in excess of the total retention limits or award ceilings by any person, natural or
juridical, except those under collective ownership by farmer-beneficiaries.

The forcible entry or illegal detainer by persons who are not quali􏰀ed bene􏰀ciaries under this
Act to avail themselves of the rights and benefits of the Agrarian Reform Program.

The conversion by any landowner of his agricultural land into any non- agricultural use with
intent to avoid the application of this Act to his landholdings and to dispossess his tenant farmers
of the land tilled by them.

The willful prevention or obstruction by any person, association or entity of the implementation
of the CARP.

The sale, transfer, conveyance or change of the nature of lands outside of urban centers and city
limits either in whole or in part after the effectivity of this Act. The date of the registration of the
deed of conveyance in the Register of Deeds with respect to titled lands and the date of the
issuance of the tax declaration to the transferee of the property with respect to unregistered lands,
as the case may be, shall be conclusive for the purpose of this Act.

The sale, transfer or conveyance by a bene􏰀ciary of the right to use or any other usufructuary
right over the land he acquired by virtue of being a beneficiary, in order to circumvent the
provisions of this Act.


Facts: Roxas & Co. is a domestic corporation and is the registered owner of three haciendas,
namely,Haciendas Palico, Banilad and Caylaway, all located in the Municipality of Nasugbu,
Batangas. Hacienda Palico is 1,024 hectares in area and is registered under Transfer Certi􏰀cate of
Title (TCT) No. 985. This land is covered by Tax Declaration Nos. 0465, 0466, 0468, 0470, 0234
and 0354. Hacienda Banilad is 1,050 hectares in area, registered under TCT No. 924 and covered
by Tax Declaration Nos. 0236, 0237 and 0390. Hacienda Caylaway is 867.4571 hectares in area
and is registered under TCT Nos. T-44662, T-44663, T-44664 and T-44665.

xxx xxx xxx

On July 27, 1987, the Congress of the Philippines formally convened and took over legislative
power from the President. This Congress passed Republic Act No. 6657, the Comprehensive
Agrarian Reform Law (CARL) of 1988. The Act was signed by the President on June 10, 1988
and took effect on June 15, 1988.

Before the law's effectivity, on May 6, 1988, [Roxas & Co.] 􏰀led with respondent DAR a
voluntary offer to sell [VOS] Hacienda Caylaway pursuant to the provisions of E.O. No. 229.
Haciendas Palico and Banilad were later placed under compulsory acquisition by . . . DAR in
accordance with the CARL. Nevertheless, on August 6, 1992, [Roxas & Co.], through its
President, Eduardo J. Roxas, sent a letter to the Secretary of . . . DAR withdrawing its VOS of
Hacienda Caylaway. The Sangguniang Bayan of Nasugbu, Batangas allegedly authorized the
reclassi􏰀􏰀cation of Hacienda Caylaway from agricultural to non-agricultural. As a result,
petitioner informed respondent DAR that it was applying for conversion of Hacienda Caylaway
from agricultural to other uses.

Essentially, Roxas & Co. 􏰀led its application for conversion of its three haciendas from
agricultural to non-agricultural on the assumption that the issuance of PP 1520 which declared
Nasugbu, Batangas as a tourism zone, reclassi􏰀ed them to non- agricultural uses. Its pending
application notwithstanding, the Department of Agrarian Reform (DAR) issued Certi􏰀cates of
Land Ownership Award (CLOAs) to the farmer- bene􏰀ciaries in the three haciendas

During the pendency before the DAR of its application for conversion following its remand to the
DAR or on May 16, 2000, Roxas & Co. 􏰀led with the DAR an application for exemption from
the coverage of the Comprehensive Agrarian Reform Program (CARP) of 1988 on the basis of PP
1520 and of DAR Administrative Order (AO) No. 6, Series of 1994 3 which states that all lands
already classi􏰀ed as commercial, industrial, or residential before the effectivity of CARP no
longer need conversion clearance from the DAR.


1. Whether PP 1520 reclassi􏰀ed in 1975 all lands in the Maragondon- Ternate-Nasugbu

tourism zone to non-agricultural use to exempt Roxas & Co.'s three haciendas in
Nasugbu from CARP coverage; HSAcaE
2. Whether Nasugbu MSO No. 4, Series of 1982 exempted certain lots in Hacienda Palico
from CARP coverage; and
3. Whether the partial and complete cancellations by the DAR of CLOA No. 6654 subject
of G.R. No. 167505 is valid.

1. Presidential Proclamation 1520 did not automatically convert the agricultural lands in the three
municipalities including Nasugbu to non- Agricultural Lands.

The perambulatory clauses of PP 1520 identi􏰀ed only "certain areas in the sector comprising the
[three Municipalities that] have potential tourism value" and mandated the conduct of "necessary
studies" and the segregation of “speci􏰀c geographic areas” to achieve its purpose. Which is why
the PP directed the Philippine Tourism Authority (PTA) to identify what those potential tourism
areas are. If all the lands in those tourism zones were to be wholly converted to non-agricultural
use, there would have been no need for the PP to direct the PTA to identify what those "speci􏰀c
geographic areas" are.

the DAR Regional O􏰀ce VII, in coordination with the Philippine Tourism Authority, has to
determine precisely which areas are for tourism development and excluded from the Operation
Land Transfer and the Comprehensive Agrarian Reform Program. And su􏰀ce it to state here that
the Court has repeatedly ruled that lands already classi􏰀ed as non-agricultural before the
enactment of RA 6657 on 15 June 1988 do not need any conversion clearance.

The Court made it clear that the "power to determine whether Haciendas Palico, Banilad a n d
Caylaway are non- agricultural, hence, exempt from the coverage of the [Comprehensive
Agrarian Reform Law] lies with the [Department of Agrarian Reform], not with this Court." 10
The DAR, an administrative body of special competence, denied, by Order of October 22, 2001,
the application for CARP exemption of Roxas & Co., it 􏰀nding that PP 1520 did not
automatically reclassify all the lands in the affected municipalities from their original uses. It
appears that the PTA had not yet, at that time, identi􏰀ed the "speci􏰀c geographic areas" for
tourism development and had no pending tourism development projects in the areas.

It bears emphasis that a mere reclassi􏰀cation of an agricultural land does not automatically allow
a landowner to change its use since there is still that process of conversion before one is permitted
to use it for other purposes.

2. Roxas & Co.’s application in DAR Administrative Case for CARP Exemption in Hacienda
Palico cannot be granted in view of discrepancies in the location and identity of the subject
parcels of land.
By Roxas & Co.'s contention, the affected six parcels of land which are the subject of DAR
Administrative Case No. A-9999-142-97 and nine parcels of land which are the subject of DAR
Administrative Case No. A-9999-008-98 involved in G.R. No. 167505, all in Hacienda Palico,
have been reclassi􏰀ed to non-agricultural uses via Nasugbu MZO No. 4 which was approved by
the forerunner of HLURB.

The landholdings covered by the aforesaid titlesdo not correspond to the Certi􏰀􏰀cation dated
February 11, 1998 of the [HLURB], the Certi􏰀􏰀cation dated September 12, 1996 issued by the
Municipal Planning and Development Coordinator, and the Certi􏰀􏰀cations dated July 31, 1997
and May 27, 1997 issued by the National Irrigation Authority. The certi􏰀cations were issued for
Lot Nos. 21, 24, 28, 31, 32 and 34. Thus, it was not even possible to issue exemption clearance
over the lots covered by TCT Nos. 60019 to 60023.

Furthermore, we alsonote the discrepancies between the certi􏰀􏰀cations issued by the HLURB
and the Municipal Planning Development Coordinator as to the area of the specific lots.
3. Roxas & Co.’s application for CARP exemption in DAR Administrative Case for the nine
parcels of land in Hacienda Palico should be granted.

By Order of November 6, 2002, the DAR Secretary granted the application for exemption but
issued the following conditions:

1. The farmer-occupants within subject parcels of land shall be maintained in their peaceful
possession and cultivation of their respective areas of tillage until a 􏰀nal determination
has been made on the amount of disturbance compensation due and entitlement of such
farmer-occupants thereto by the PARAD of Batangas;
2. No development shall be undertaken within the subject parcels of land until the
appropriate disturbance compensation has been paid to the farmer- occupants who are
determined by the PARAD to be entitled thereto. Proof of payment of disturbance
compensation shall be submitted to this O􏰀ce within ten (10) days from such payment;
3. The cancellation of the CLOA issued to the farmer-bene􏰀ciaries shall be subject of a
separate proceeding before the PARAD of Batangas. 36

4. the Certificate of Land Ownership Awards (CLOAs) issued by the DAR in Administrative
Case to the Farmer-Beneficiaries must be cancelled.

It bears recalling that in DAR Administrative Case Nos. A- 9999-008-98 and A-9999-142-97
(G.R. No. 179650), the Court ruled for Roxas & Co.'s grant of exemption in DAR Administrative
Case No. A-9999-008-98 but denied the grant of exemption in DAR Administrative Case No. A-
9999-142-97 for reasons already discussed. It follows that the CLOAs issued to the farmer-
bene􏰀ciaries in DAR Administrative Case No. A-9999-008-98 must be cancelled.

In the main, there is no logical recourse except to cancel the CLOAs issued for the nine parcels of
land identified as Lot Nos. 20, 13, 37, 19-B, 45, 47, 49, 48-1 and 48-2 which are portions of TCT
No. 985 covering 45.9771 hectares in Hacienda Palico (or those covered by DAR Administrative
Case No. A-9999-008-98). As for the rest of the CLOAs, they should be respected since Roxas &
Co., as shown in the discussion in G.R. Nos. 167540, 167543 and 167505, failed to prove that the
other lots in Hacienda Palico and the other two haciendas, aside from the above-mentioned nine
lots, are CARP- exempt.

Roxas & Co. is thus mandated to 􏰀rst satisfy the disturbance compensation of affected farmer-
bene􏰀ciaries in the areas covered by the nine parcels of lands in DAR AO No. A-9999-008-98
before the CLOAs covering them can be cancelled. And it is enjoined to strictly follow the
instructions of R.A. No. 3844.


1) I nG.R. No. 167540, the CourtREVERSES andSETS ASIDE the November 24, 2003 Decision
46 and March 18, 2005 Resolution of the Court of Appeals in CA-G.R. SP No. 72131 which
declared that Presidential Proclamation No. 1520 reclassi􏰀ed the lands in the municipalities of
Nasugbu in Batangas and Maragondon and Ternate in Cavite to non-agricultural use;

2) The Court accordingly GRANTS the Motion for Reconsideration of the Department of
Agrarian Reform in G.R. No. 167543 and REVERSES a n d SETS ASIDE its Resolution of June
20, 2005;

3) In G.R. No. 149548, the Court DENIES the petition for review of Roxas & Co. for lack of

4) I n G.R. No. 179650, the Court GRANTS the petition for review of DAMBA-NSFW and
REVERSES and SETS ASIDE the October 31, 2006 Decision and August 16, 2007 Resolution of
the Court of Appeals in CA-G.R. SP No. 82225;

5) In G.R. No. 167505, the Court DENIES the petition for review of DAMBA- NSFW and
AFFIRMS the December 20, 2004 Decision and March 7, 2005 Resolution of the Court of
Appeals in CA-G.R. SP No. 82226;

6) In G.R. No. 167845, the Court DENIES Roxas & Co.'s petition for review for lack of merit and
AFFIRMS the September 10, 2004 Decision and April 14, 2005 Resolution of the Court of

7) I n G.R. No. 169163, the Court SETS ASIDE the Decisions of the Provincial Agrarian Reform
Adjudicator in DARAB Case No. 401-239-2001 ordering the cancellation of CLOA No. 6654
and DARAB Cases Nos. R-401-003-2001 to No. R-401- 005-2001 granting the partial
cancellation of CLOA No. 6654. The CLOAs issued for Lots No. 21 No. 24, No. 26, No. 31, No.
32 and No. 34 or those covered by DAR Administrative Case No. A-9999-142-97) remain; and

8) Roxas & Co. is ORDERED to pay the disturbance compensation of affected farmer-
bene􏰀ciaries in the areas covered by the nine parcels of lands in DAR Administrative Case No.
A-9999-008-98 before the CLOAs therein can be cancelled, and is ENJOINED to strictly follow
the mandate of R.A. No. 3844.

Facts: At the core of the controversy are several parcels of unirrigated land (303.38545 hectares)
which form part of a larger expanse with an area of 372 hectares situated at Barangay Langkaan,
Dasmariñas, Cavite. Originally owned by the Manila Golf and Country Club, the property was
acquired by the [herein respondent EMRASON] in 1965 for the purpose of developing the same
into a residential subdivision known as "Traveller's Life Homes".

Sometime in 1971, the Municipal Council of Dasmariñas, Cavite, acting pursuant to Republic Act
(R.A.) No. 2264, otherwise known as the "Local Autonomy Act", enacted Municipal Ordinance
No. 1, hereinafter referred to as Ordinance No. 1, entitled "An Ordinance Providing Subdivision
Regulation and Providing Penalties for Violation Thereof".

In May, 1972, [respondent] E.M. Ramos and Sons, Inc., applied for an authority to convert and
develop its aforementioned 372-hectare property into a residential subdivision, attaching to the
application detailed development plans and development proposals from Bancom Development
Corporation and San Miguel Corporation. Acting thereon, the Municipal Council of Dasmariñas,
Cavite passed on July 9, 1972 Municipal Ordinance No. 29-A (Ordinance No. 29-A, for brevity),
approving [EMRASON's] application.

Subsequently, [EMRASON] paid the fees, dues and licenses needed to proceed with property
It appears, however, that the actual implementation of the subdivision project suffered delay
owing to the con􏰀uence of events

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.

On September 23, 1988, the Municipal Mayor of Dasmariñas, Cavite addressed a letter to
[EMRASON], stating in part that the Municipality of Dasmariñas, Cavite has approved the
development of their property situated in Barrios Bukal and Langkaan, Dasmariñas, Cavite into a
residential, industrial commercial and golf course project.

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.

However, the size of the NDC property turned out to be insu􏰀cient for both the demands of the
proposed industrial project as well as the government's commitment to the tenant-farmers. To
address this commitment, the Department of Agrarian Reform (DAR) was thus tasked with
acquiring additional lands from the nearby areas. The DAR earmarked for this purpose the
subject property of [EMRASON].

Issue/s: Whether or not the subject property could be placed under the Comprehensive Agrarian
Reform Program.
Ruling: The DOJ Opinion adverted to, rendered by then Justice Secretary Franklin Drilon,
clari􏰀ed that lands already converted to non-agricultural uses before June 15, 1988 were no
longer covered by CARP.

CARP coverage limited to agricultural land

Section 4, Chapter II of the CARL, as amended,24 particularly de􏰀nes the coverage of the
CARP, to wit:

SEC. 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 􏰀ve (5) hectares and below shall not be covered for acquisition and distribution to
qualified beneficiaries. The CARL took effect onJune 15, 1988. To be exempt from the CARP,
the subject property should have already been reclassi􏰀ed as residential prior to said date.

Section 3 of R.A. No. 2264, otherwise known as the Local Autonomy Act, empowers a Municipal
Council "to adopt zoning and subdivision ordinances or regulations" for the municipality. Clearly,
the law does not restrict the exercise of the power through an ordinance. Therefore, granting that
Resolution No. 27 is not an ordinance, it certainly is a regulatory measure within the intendment
or ambit of the word "regulation" under the provision.

Section 3 (c), Chapter I of the CARL provides that a parcel of land reclassi􏰀ed for non-
agricultural uses prior to June 15, 1988 shall no longer be considered agricultural land subject to
CARP. The Court is now faced with the question of whether Resolution No. 29-A of the
Municipality of Dasmariñas dated July 9, 1972, which approved the subdivision of the subject
property for residential purposes, had also reclassi􏰀ed the same from agricultural to residential.

Zoning classi􏰀cation is an exercise by the local government of police power, not the power of
eminent domain. A zoning ordinance is de􏰀ned as a local city or municipal legislation which
logically arranges, prescribes, de􏰀nes, and apportions a given political subdivision into specific
land uses as present and future projection of needs. 26

It may, therefore, be reasonably presumed that when city and municipal boards and councils
approved an ordinance delineating an area or district in their cities or municipalities as residential,
commercial, or industrial zone, pursuant to the power granted to them under Section 3 of the
Local Autonomy Act of 1959, they were, at the same time, reclassifying any agricultural lands
within the zone for non-agricultural use

Resolution No. 29-A is a valid ordinance, which, upon its approval on July 9, 1972, immediately
effected the zoning and reclassifying of the subject property for residential use. It need not
comply with any of the requirements or conditions which DAR and Buklod are insisting upon.

Since consultation with the NPC was merely discretionary, then there were only two mandatory
requirements for a valid zoning or subdivision ordinance or regulation under Section 3 of the
Local Autonomy Act of 1959, namely, that (1) the ordinance or regulation be adopted by the city
or municipal board or council; and (2) it be approved by the city or municipal mayor, both of
which were complied with by Resolution No. 29- A.

It is manifest, even from just a plain reading of said resolution, that the application for
subdivision covering the subject property was categorically and unconditionally approved by the
Municipality of Dasmariñas. As a consequence of such approval, the subject property is
immediately deemed zoned and reclassi􏰀ed as residential.

In relation to the preceding paragraph, Administrative Order No. 152 dated December 16, 1968
required city and municipal boards and councils to submit proposed subdivision ordinances and
plans or forward approved subdivision ordinances to the NPC. The OP imposed such a
requirement because "it has come to the attention of [the] O􏰀ce that the minimum standards of
such ordinances regarding design, servicing and streets, and open spaces for parks and other
recreational purposes are not being complied with[.]" 39 Review by the NPC of the proposed
subdivision plan was for the purpose of determining "if it conforms with the subdivision
ordinance."40 ACSaHc

It is apparent that Section 16 (a) of Ordinance No. 1 and Administrative Ordinance No. 152
contained the same directive: that the 􏰀nal plat of the subdivision be reviewed by the NPC to
determine its conformity with the minimum standards set in the subdivision ordinance of the

Nonetheless, the Sangguniang Bayan of Dasmariñas in this case, in its exercise of police power
through the enactment of the 1981 Comprehensive Zoning Ordinance, itself abided by the general
rule and included in the very same ordinance an express commitment to honor rights that had
already vested under previous ordinances, rules, and regulations. EMRASON acquired the vested
right to use and develop the subject property as a residential subdivision on July 9, 1972 with the
approval of Resolution No. 29-A by the Municipality of Dasmariñas. Such right cannot be
impaired by the subsequent enactment of the 1981 Comprehensive Zoning Ordinance of
The Court reiterates that since July 9, 1972, upon approval of Resolution No. 29- A by the
Municipality of Dasmariñas, the subject property had been reclassi􏰀ed from agricultural to
residential. The tax declarations covering the subject property, classifying the same as
agricultural, cannot prevail over Resolution No. 29-A.

Since the subject property had been reclassi􏰀ed as residential land by virtue of Resolution No.
29-A dated July 9, 1972, it is no longer agricultural land by the time the CARL took effect on
June 15, 1988 and is, therefore, exempt from the CARP.

Based on the foregoing, it is clear that the undeveloped portions of the Antipolo Hills Subdivision
cannot in any language be considered as "agricultural lands." These lots were intended for
residential use. They ceased to be agricultural lands upon approval of their inclusion in the
Lungsod Silangan Reservation.

Since the NATALIA lands were converted prior to 15 June 1988, respondent DAR is bound by
such conversion. It was therefore error to include the undeveloped portions of the Antipolo Hills
Subdivision within, the coverage of CARL.

On a 􏰀nal note, this Court has stressed more than once that social justice — or any justice for that
matter — is for the deserving, whether he be a millionaire in his mansion or a pauper in his hovel.
It is true that, in case of reasonable doubt, the Court is called upon to tilt the balance in favor of
the poor to whom the Constitution 􏰀ttingly extends its sympathy and compassion. But never is it
justi􏰀ed to give preference to the poor simply because they are poor, or to reject the rich simply
because they are rich, for justice must always be served for poor and rich alike, according to the
mandate of the law. 70 Vigilance over the rights of the landowners is equally important because
social justice cannot be invoked to trample on the rights of property owners, who under our
Constitution and laws are also entitled to protection.


Facts: Before us are two Rule 45 Petitions 1 􏰀led separately by the Department of Agrarian
Reform (DAR), through the O􏰀ce of the Solicitor General, and by the Salvador N. Lopez Agri-
Business Corp. (SNLABC). Each Petition partially assails the Court of Appeals Decision dated
30 June 2006 2 with respect to the application for exemption of four parcels of land — located in
Mati, Davao Oriental and owned by SNLABC — from Republic Act No. 6657, otherwise known
as the Comprehensive Agrarian Reform Law (CARL).

On December 10, 1992, petitioner 􏰀led with the Provincial Agrarian Reform O􏰀ce (PARO),
Davao Oriental, an Application for Exemption of the lots covered by TCT No. T-12637 and T-
12639 from CARP coverage. It alleged that pursuant to the case of Luz Farms v. DAR Secretary
said parcels of land are exempted from coverage as the said parcels of land with a total area of
110.5455 hectares are used for grazing and habitat of petitioner's 105 heads of cattle, 5 carabaos,
11 horses, 9 heads of goats and 18 heads of swine, prior to the effectivity of the Comprehensive
Agrarian Reform Law (CARL).

On March 28, 1995, petitioner 􏰀led before the DAR Regional Director of Davao City an
application for the exemption from CARP coverage of Lots 1454-A and 1296 stating that it has
been operating grazing lands even prior to June 15, 1988 and that the said two (2) lots form an
integral part of its grazing land.

Issue/s: whether the Lopez and Limot lands of SNLABC can be considered grazing lands for its
livestock business and are thus exempted from the coverage of the CARL under the Court's ruling
in Luz Farms v. DAR.

Ruling: In Luz Farms v. Secretary of the Department of Agrarian Reform, 13 the Court declared
unconstitutional the CARL provisions14 that 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. 15 Thus, lands devoted to
the raising of livestock, poultry and swine have been classi􏰀ed as industrial, not agricultural, and
thus exempt from agrarian reform. 16

In the instant case, the MARO in its ocular inspection 22 found on the Lopez lands several heads
of cattle, carabaos, horses, goats and pigs, some of which were covered by several certi􏰀cates of
ownership. There were likewise structures on the Lopez lands used for its livestock business,
structures consisting of two chutes where the livestock were kept during nighttime. The existence
of the cattle prior to the enactment of the CARL was positively a􏰀rmed by the farm workers and
the overseer who were interviewed by the MARO. Considering these factual 􏰀ndings and the fact
that the lands were in fact being used for SNLABC's livestock business even prior to 15 June
1988, the DAR Regional Director ordered the exemption of the Lopez lands from CARP

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 􏰀ndings of the MARO — as a􏰀rmed 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. 23

Exemption from CARP, however, is directly a function of the land's usage, and not of the identity
of the entity operating it. Otherwise stated, lands actually, directly and exclusively used for
livestock are exempt from CARP coverage, regardless of the change of owner. 26 In the instant
case, whether SNLABC was incorporated prior to the CARL is immaterial, since the Lopez lands
were already being used for livestock-grazing purposes prior to the enactment of the CARL, as
found by the MARO.

Furthermore, the presence of coconut trees, although an indicia that the lands may be agricultural,
must be placed within the context of how they 􏰀gure in the actual, direct and exclusive use of the
subject lands. The DAR failed to demonstrate that the Lopez lands were actually and primarily
agricultural lands planted with coconut trees.

It is not uncommon for an enormous landholding to be intermittently planted with trees, and this
would not necessarily detract it from the purpose of livestock farming and be immediately
considered as an agricultural land. It would be surprising if there were no trees on the land.
On the assumption that 􏰀ve thousand 􏰀ve hundred forty-eight (5,548) coconut trees were
existing on the Lopez land (TCT No. T-12637), the DAR did not refute the 􏰀ndings of the
MARO that these coconut trees were merely incidental. Given the number of livestock heads of
SNLABC, it is not surprising that the areas planted with coconut trees on the Lopez lands where
forage grass grew were being used as grazing areas for the livestock.

In contrast, the Limot lands were found to be agricultural lands devoted to coconut trees and
rubber and are thus not subject to exemption from CARP coverage.

In the Report dated 06 April 1994, the team that conducted the inspection found that the entire
Limot lands were devoted to coconuts (41.5706 hectares) and rubber (8.000 hectares) and
recommended the denial of the application for exemption.30 Verily, the Limot lands were
actually, directly and exclusively used for agricultural activities, a fact that necessarily makes
them subject to the CARP.

In the 07 February 1994 Letter-A􏰀davit addressed to the DAR Secretary, SNLABC requested the
exemption of the Limot lands on the ground that the corporation needed the additional area for its
livestock business. As pointed out by the DAR Regional Director, this Letter-A􏰀davit is a clear
indication that the Limot lands were not directly, actually and exclusively used for livestock

The con􏰀uence of these factual circumstances leads to the logical conclusion that the Limot lands
were not being used for livestock grazing and, thus, do not qualify for exemption from CARP


Facts: On December 22, 1988, the Sangguniang Panlalawigan of the Province of Camarines Sur
passed Resolution No. 129, Series of 1988, authorizing the Provincial Governor to purchase or
expropriate property contiguous to the provincial capitol site, in order to establish a pilot farm for
non-food and non-traditional agricultural crops and a housing project for provincial government
employees. cdasia

Pursuant to the Resolution, the Province of Camarines Sur, through its Governor, Hon. Luis R.
Villafuerte, filed two separate cases for expropriation against Ernesto N. San Joaquin and Efren
N. San Joaquin.

The San Joaquins moved to dismiss the complaints on the ground of inadequacy of the price
offered for their property. In an order dated December 6, 1989, the trial court denied the motion
to dismiss and authorized the Province of Camarines Sur to take possession of the property.

In their petition before the Court of Appeals, the San Joaquins asked: (a) that Resolution No. 129,
Series of 1988 of the Sangguniang Panlalawigan be declared null and void; (b) that the
complaints for expropriation be dismissed; and (c) that the order dated December 6, 1989 (i)
denying the motion to dismiss and (ii) allowing the Province of Camarines Sur to take possession
of the property subject of the expropriation and the order dated February 26, 1990, denying the
motion to admit the amended motion to dismiss, be set aside. They also asked that an order be
issued to restrain the trial court from enforcing the writ of possession, and thereafter to issue a
writ of injunction.
It must be noted that in the Court of Appeals, the San Joaquins asked for: (i) the dismissal of the
complaints for expropriation on the ground of the inadequacy of the compensation offered for the
property and (ii) the nullification of Resolution No. 129, Series of 1988 of the Sangguniang
Panlalawigan of the Province of Camarines Sur.

Issue/s: whether the expropriation of agricultural lands by local government units is subject to the
prior approval of the Secretary of the Agrarian Reform, as the implementor of the agrarian reform

Ruling: Under the new concept, "public use" means public advantage, convenience or benefit,
which tends to contribute to the general welfare and the prosperity of the whole community, like
a resort complex for tourists or housing project

The expropriation of the property authorized by the questioned resolution is for a public purpose.
The establishment of a pilot development center would inure to the direct benefit and advantage
of the people of the Province of Camarines Sur. Once operational, the center would make
available to the community invaluable information and technology on agriculture, fishery and the
cottage industry. Ultimately, the livelihood of the farmers, fishermen and craftsmen would be
enhanced. The housing project also satisfies the public purpose requirement of the Constitution.

It is the submission of the Province of Camarines Sur that its exercise of the power of eminent
domain cannot be restricted by the provisions of the Comprehensive Agrarian Reform Law (R.A.
No. 6657), particularly Section 65 thereof, which requires the approval of the Department of
Agrarian Reform before a parcel of land can be reclassified from an agricultural to a non-
agricultural land.

The Court of Appeals, following the recommendation of the Solicitor General, held that the
Province of Camarines Sur must comply with the provision of Section 65 of the Comprehensive
Agrarian Reform Law and must first secure the approval of the Department of Agrarian Reform
of the plan to expropriate the lands of the San Joaquins.

The Solicitor General denigrated the power to expropriate by the Province of Camarines Sur by
stressing the fact that local government units exercise such power only by delegation. (Comment,
pp. 14-15; Rollo, pp. 128-129). cdrep

It is true that local government units have no inherent power of eminent domain and can exercise
it only when expressly authorized by the legislature (City of Cincinnati v. Vester, 281 US 439, 74
L.ed. 950, 50 S Ct. 360). It is also true that in delegating the power to expropriate, the legislature
may retain certain control or impose certain restraints on the exercise thereof by the local

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.

This Court has declared as unconstitutional the Presidential Decrees fixing the just compensation
in expropriation cases to be the value given to the condemned property either by the owners or
the assessor, whichever was lower

WHEREFORE, the petition is GRANTED and the questioned decision of the Court of Appeals is
set aside insofar as it (a) nullifies the trial court's order allowing the Province of Camarines Sur to
take possession of private respondents' property; (b) orders the trial court to suspend the
expropriation proceedings; and (c) requires the Province of Camarines Sur to obtain the approval
of the Department of Agrarian Reform to convert or reclassify private respondents' property from
agricultural to non-agricultural use.