February 28, 2018

G.R. No. 187423

LANDBANK OF THE PHILIPPINES v. EDNA MAYO ALCANTARA
MARTIRES, J.:

FACTS:

Edna Mayo Alcantara and the heirs of Cristy Mayo Alcantara were the registered owners of the
subject agricultural land. The land was originally composed of 34 hectares. The DAR issued a
Notice of Land Valuation and Acquisition over 22 hectares of the land. LBP, the financial
intermediary of the CARP, thus gave its valuation for the acquired portion. Respondents did not
question their land's acquisition but disagreed with its valuation, alleging that the subject land
has been converted to a residential subdivision.

ISSUE:

WON conversion of land use have any effect on the determination of the property’s just
compensation under CARP

RULING:

NO, conversion should not have any bearing in the determination of the subject property's just
compensation.

Available records do not indicate that the DAR Secretary had authorized the alleged
conversion. The same records also do not indicate the existence of a zoning ordinance
reclassifying said land as to lawfully allow the establishment of a residential subdivision
thereon. Neither were these decisive facts pleaded before this court. The subject land's alleged
conversion to a residential subdivision, therefore, is poorly supported. Why the SAC relied
solely on the verbal say-so of the municipal assessor is puzzling.

On this note, it should also be said, if only in passing, that if it were true that the land use of the
subject agricultural land – the acquisition of which for purposes of the state's agrarian reform
program was fait accompli – was converted to residential pending the determination of its just
compensation, then what we have here is a gravely anomalous situation. Such conversion
would be antithetical to the agrarian reform program, to say the very least.

At any rate, its alleged conversion should not have any bearing in the determination of the
subject property's just compensation. The government cannot be compelled to pay for a CARP
land the price that it would have fetched in the competitive residential real estate market. It
goes without saying, there is nothing in R.A. No. 6657 or in the pertinent DAR administrative
issuances that authorizes that the just compensation for a CARP land should be based
exclusively on its market value.
March 29, 2017
G.R. No. 191545
HEIRS OF AUGUSTO SALAS, JR. v. MARCIANO CABUNGCAL, et al.
LEONEN, J.:

FACTS:

Petitioners are the heirs of the registered owner of a vast tract of land, while respondents are
agrarian reform beneficiaries under the CARP. Pursuant to the approved town plan (Town
Plan/Zoning Ordinance), the subject land was reclassified as farmlot subdivision for cultivation,
livestock production, or agro-forestry. While portion of the land was sold, more than half
remained unsold. Hence, petitioner heirs assailed the inclusion of their landholdings from CARP.

ISSUES:

Whether the reclassification of petitioners' agricultural land as a farmlot subdivision exempts

the Estate of Salas from the coverage of the CARP

HELD:

NO, the Comprehensive Agrarian Reform Law covers all agricultural lands, save for those not
used or suitable for agricultural activities.

The reclassification of Salas' landholding into a farmlot subdivision, although effected before
Republic Act No. 6657, has not changed the nature of these agricultural lands, the legal
relationships existing over such lands, or the agricultural usability of the lands. Thus, these
lots were properly subjected to compulsory coverage under the Comprehensive Agrarian
Reform Law.

This case involves a land that was reclassified as a "farmlot subdivision," intended for "intensive
agricultural activities." Likewise, located away from the city center, the farmlot subdivision has
not been developed into an urban zone. When Salas' agricultural land was reclassified as a
farmlot subdivision, the applicable law was Republic Act No. 3844, as amended.

Section 166 (1) of Republic Act No. 3844 defined an agricultural land as "land devoted to any
growth, including but not limited to crop lands[.]" The law neither made reference to a "farmlot
subdivision," nor did it exclude a farmlot from the definition of an agricultural land.

Not being excluded, Salas' landholdings were thus contemplated in the definition of an
agricultural land under Republic Act No. 3844.

Likewise, Republic Act No. 6657 does not exclude a farmlot subdivision from the definition of an
agricultural land. Section 3(c) of Republic Act No. 6657 states that agricultural lands refer to
"land devoted to agricultural activity . . . and not classified as mineral, forest, residential,
commercial, or industrial land." Section 76 expressly provides that any other definition
inconsistent with Republic Act No. 6657 has been repealed by this law.
 Agricultural lands consist of lands:
(1) Devoted to agricultural activity, as defined in Republic Act No. 6657;
(2) Not classified as mineral or forest by the Department of Environment and Natural
Resources; and
(3) Prior to June 15, 1988, not classified for residential, commercial, or industrial use
under a local government town plan and zoning ordinance, as approved by the BLURB
(or its predecessors, the National Coordinating Council and the Human Settlements
Regulatory Commission).

Salas' farmlot subdivision fulfills these elements.

For the first element, the lots are devoted to agricultural activity. Agricultural activity refers to
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 persons whether
natural or juridical." Petitioners never denied the continued existence of agricultural activity
within these lots.

For the second element, it is undisputed that the lots have not been declared as mineral or
forest lands by the Department of Environment and Natural Resources. No application has been
filed to declare the landholdings as mineral or forest lands, and neither has the Department of
Environment and Natural Resources ever declared the properties as such.

As to the third element, the lands were not classified by the Lipa City Town Plan/Zoning
Ordinance as commercial, residential, or industrial lands prior to June 15, 1988. Rather, the
reclassification, which was approved by HLURB's predecessor agency, was that of a "farmlot
subdivision."
January 12, 2016
G.R. No. 178110
AYALA LAND, INC. v. SIMEONA CASTILLO, ET AL.
SERENO, C.J.:

FACTS:

Petitioner CCFI owned two parcels of land with a total area of 221 which was mortgaged in
favor of one of its creditors, MBC. When MBC was placed under receivership, DAR issued a
Notice of Coverage placing the property under compulsory acquisition under the
Comprehensive Agrarian Reform Law of 1988. In the meantime, CCFI was unable to comply
with its mortgage obligations to MBC. The latter foreclosed on the lien, and the land was
awarded to it in an auction sale. In a Deed of Partial Redemption, the down payment, which
was 30% of the purchase price, would be payable to the bank only upon approval of the
exemption of the two parcels of land from the coverage of CARL or upon their conversion to
non-agricultural use.

MBC requested DAR to issue an order exempting the landholdings of MBC from CARL and to
declare a moratorium on the compulsory acquisition of MBCs landholdings, which was denied.
The order was reversed by the Office of the President, and DAR eventually issued a resolution
granting MBC’s Request for Clearance to Sell applying Section 73-A of R.A. 6657 that allows the
sale of agricultural land where such sale or transfer is necessitated by a banks foreclosure of a
mortgage

ISSUES:

1- Whether or not the subject property has been converted into non-agricultural use

2- Whether or not the LGC provision requiring an ordinance for a valid reclassification was
violated (from 2011 Decision)

3- Whether or not the subject property is covered by CARL

HELD:

1- YES, conversion is still possible despite the non-existence of a zoning ordinance.

Although a zoning ordinance as approved by the HLURB was a requirement for the
approval of the application for conversion under DAR A.O. No. 12-94, if the
city/municipality does not have a comprehensive development plan and zoning
ordinance duly approved by HLRB/SP but the dominant use of the area surrounding the
land subject of the application for conversion is no longer agricultural, or if the proposed
use is similar to, or compatible with the dominant use of the surrounding areas as
determined by the DAR, conversion may be possible.
 Here, the Municipality of Silang does not have an approved town plan/zoning
ordinance/comprehensive land use plan. Moreover, the submission of an ordinance was
by recommendation of the CLUPPI-1, and that the ordinance has not been adopted by
DAR.

2- NO, because conversion is different from reclassification.

Conversion and reclassification are separate procedures. Paragraph B (3), Part VI of DAR
AO 12-94 allows conversion when the land will have greater economic value for
residential, commercial or industrial purposes “as certified by the Local Government
Unit.” It is clear that the thrust of the community and the local government is the
conversion of the lands. To this end, the two Resolutions, one issued by the
Sangguniang Bayan of Silang, the other by the Sangguniang Panlalawigan ofCavite, while
not strictly for purposes of reclassification, are sufficient compliance with the
requirement of the Conversion Order.

3- NO, the DAR has already conclusively found that the topography is hilly and has an
average slope of more than 18%. Hence, the land is exempt from CARP coverage under
Section 10 of R.A. 6657
July 15, 2015
G.R. No. 197127
NOEL L. ONG v. NICOLASA O. IMPERIAL, et al.
LEONARDO-DE CASTRO, J.:

FACTS:

Petitioners are registered owners of a parcel of land with an area of 405,000 square meters.
The Municipal Agrarian Reform Officer (MARO) of Daet issued a Notice of Coverage to
petitioners. Petitioners protested to the coverage of the subject property under compulsory
acquisition under Comprehensive Agrarian Reform Law (CARL). Petitioners then filed an
application for exemption clearance with the Department of Agrarian Reform (DAR) claiming
that subject property had already been reclassified as residential built-up area pursuant to the
Town Plan and Zoning Ordinance of Daet dated September 21, 1978 and Zoning Ordinance No.
04, series of 1980.

ISSUE:

Whether the subject property is exempt from CARP

RULING:

YES, to be exempt from CARP, all that is needed is one valid reclassification of the land from
agricultural to non- agricultural by a duly authorized government agency before June 15, 1988,
when the CARL took effect. It was also emphasized therein that "[t]he power of the local
government to convert or reclassify lands [from agricultural to non-agricultural lands prior to
the passage of RA 6657] is not subject to the approval of the [DAR]."

Since the subject property had been reclassified as residential/commercial land with the
enactment of City Ordinance No. 1313 in 1975, it can no longer be considered as an
"agricultural land" within the ambit of RA 6657. Indeed, lands not devoted to agricultural
activity are outside the coverage of CARL. These include lands previously converted to non-
agricultural uses prior to the effectivity of CARL by government agencies other than respondent
DAR.

Be that as it may, the Secretary of Justice, responding to a query by the Secretary of Agrarian
Reform, noted in an Opinion that lands covered by Presidential Proclamation No. 1637, inter
alia, of which the NATALIA lands are part, having been reserved for townsite purposes "to be
developed as human settlements by the proper land and housing agency," are "not deemed
‘agricultural lands’ within the meaning and intent of Section 3(c) of R.A. No. 6657." Not being
deemed "agricultural lands," they are outside the coverage of CARL.

These lands no longer need any conversion clearance from the Department of Agrarian
Reform (DAR).
June 9, 2014
G.R. No. 200491
KASAMAKA-CANLUBANG, INC v. LAGUNA ESTATE DEVELOPMENT CORPORATION
PERALTA, J.:

FACTS:

Laguna Estate Development Corporation (LEDC) filed for the conversion of 10 parcels of land
consisting of an aggregate area of 216 hectares from agricultural to residential land, pursuant
to Republic Act (RA) No. 3844. Respondent’s request was granted provided that certain
conditions are complied with, one of which was that the development of the site shall
commence within 2 years from receipt of the order of conversion.

KASAMAKA-Canlubang, Inc. filed a petition for the revocation of the conversion order, alleging
that LEDC failed to develop the subject parcels of land. Then DAR Secretary issued an Order
partially revoking the conversion order as 8/10 parcels of land. The remaining 2 parcels of land
were excluded from the revocation by virtue of a DAR Exemption which removed said lands
from the ambit of RA No. 6657.

Respondent filed a motion for reconsideration, alleging that the 8 parcels of land in question
are likewise outside the ambit of the CARL on the basis of zoning ordinances issued by the
municipalities concerned reclassifying said lands as non-agricultural.

ISSUES:

1- Whether lands classified as non-agricultural on the basis of zoning ordinances (which took
effect prior to CARL) are outside the ambit of CARL

2- Whether municipal zoning ordinances classifying lands to non-agricultural ipso facto change
the nature of said lands

HELD:

1- YES, lands already classified as commercial, industrial or residential before the effectivity of
the CARL, or June15, 1988, are outside the coverage thereof.

In Natalia Realty, Inc. v. Department of Agrarian Reform, for instance, we held that the DAR
committed grave abuse of discretion when it placed undeveloped portions of land intended
for residential use under the ambit of the CARL.

Similarly, in Pasong Bayabas Farmers Association, Inc. v. Court of Appeals, we nullified the
decision of the Department of Agrarian Reform Adjudication Board (DARAB) declaring the
land in dispute as agricultural and, thus, within the coverage of the CARL, when the same
had already been reclassified as residential by several government agencies prior to the
effectivity of the law.
 We likewise held in Junio v. Garilao that properties identified as zonal areas not for
agricultural use prior on June 15, 1988 are exempted from CARL coverage, even without
confirmation or clearance from the DAR.

Applying the doctrines cited above, it cannot be denied that the disputed lands are likewise
outside the ambit of the CARL. As mentioned previously, by virtue of zoning ordinances
issued by the Municipality of Calamba, Laguna, as accepted by the Sangguniang Bayan of
Cabuyao and approved by the Human Settlements Regulatory Commission, the subject
lands were effectively converted into residential areas. These ordinances were issued and
accepted in 1979 and 1980, or before the effectivity of the CARL which took effect on June
15, 1988. It necessarily follows, therefore, that the properties herein can no longer be
subject to compulsory coverage of the CARL.

2- YES, even from a plain reading of the order of conversion in this case, that the respondent’s
application for converting the disputed lands from agricultural to residential is granted. As a
consequence of such approval, the fact that the subject property is deemed zoned and
reclassified as residential upon compliance with the conditions imposed cannot be
questioned.

Petitioner failed to sufficiently prove respondent’s non-compliance with the condition

provided by the conversion order to commence the development of the subject lands
herein. Petitioner further failed to refute the application of the rule that lands already
classified as commercial, industrial or residential before the effectivity of the CARL, or June
15, 1988, are outside the coverage thereof. In the absence, therefore, of any convincing
proof that the CA committed errors in its appreciation of facts, this Court will refrain from
disturbing the ruling of the same.
January 23, 2013
G.R. No. 188299
HEIRS OF LUIS A. LUNA v. RUBEN S. AFABLE, et al
PEREZ, J.:

FACTS:

Petitioners are co-owners of a parcel of land with an area of 158 hectares. 100 hectares of the
landholding was subjected to compulsory acquisition under the Comprehensive Agrarian
Reform Program (CARP) through a Notice of Land Valuation and Acquisition issued by the
Provincial Agrarian Reform Officer (PARO).

Respondents were identified by the DAR as qualified farmer-beneficiaries; hence, the

corresponding Certificates of Land Ownership Award (CLOAs) were generated, issued to
respondents and duly registered in their names.

Petitioners filed before the DAR Adjudication Board (DARAB) a Petition for "Cancellation of
CLOAs, Revocation of Notice of Valuation and Acquisition and Upholding and Affirming the
Classification of Subject Property and Declaring the same outside the purview of RA No. 6657”
anchored mainly on the reclassification of the land in question into a light intensity industrial
zone pursuant to Municipal Ordinance No. 21, series of 1981 thereby excluding the same from
the coverage of the agrarian law.

ISSUE:

Whether the subject land had been reclassified as non-agricultural as early as 1981 (prior to the
effectivity of the CARL) and, therefore, exempt from its coverage.

HELD:

YES, petitioners’ land is outside the coverage of the agrarian reform program.

Section 4 of RA No. 6657 states that the coverage of the CARL is as follows:

SEC. 4. Scope. – The Comprehensive Agrarian Reform Law of 1989 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.

More specifically, the following lands are covered by the Comprehensive Agrarian
Reform Program:

(a) All alienable and disposable lands of the public domain devoted to or suitable
for agriculture;
 (b) All lands of the public domain in excess of the specific limits as determined by
Congress in the preceding paragraph;

(c) All private lands devoted to or suitable for agriculture regardless of the
agricultural products raised or that can be raised thereon.

"Agricultural land" is defined under Section 3(c) of the CARL as that which is "devoted to
agricultural activity x x x and not classified as mineral, forest, residential, commercial or
industrial land."

The meaning of "agricultural lands" covered by the CARL was explained further by the
DAR in its AO No. 1, Series of 1990, dated 22 March 1990, entitled "Revised Rules and
Regulations Governing Conversion of Private Agricultural Land to Non-Agricultural
Uses," issued pursuant to Section 49 of the CARL. Thus:

Agricultural land refers to those devoted to agricultural activity as defined in RA 6657

and not classified as mineral or forest by the Department of Environment and Natural
Resources (DENR) and its predecessor agencies, and not classified in town plans and
zoning ordinances as approved by the Housing and Land Use Regulatory Board (HLURB)
and its preceding competent authorities prior to 15 June 1988 for residential,
commercial or industrial use.

It is clear from the last clause of the afore-quoted provision that a land is not agricultural, and
therefore, outside the ambit of the CARP if the following conditions concur:

1. the land has been classified in town plans and zoning ordinances as residential,
commercial or industrial; and

2. the town plan and zoning ordinance embodying the land classification has been
approved by the HLURB or its predecessor agency prior to 15 June 1988.

The regulation by local legislatures of land use in their respective territorial jurisdiction through
zoning and reclassification is an exercise of police power. The power to establish zones for
industrial, commercial and residential uses is derived from the police power itself and is
exercised for the protection and benefit of the residents of a locality. Ordinance No. 21 of the
Sangguniang Bayan of Calapan was issued pursuant to Section 3 of the Local Autonomy Act of
1959 and is, consequently, a valid exercise of police power by the local government of Calapan.

The power of local government units to convert or reclassify lands from agricultural to non-
agricultural prior to the passage of Republic Act (RA) No. 6657 – the Comprehensive Agrarian
Reform Law (CARL) – is not subject to the approval of the Department of Agrarian Reform
(DAR). In this sense, the authority of local government units to reclassify land before 15 June
1988 – the date of effectivity of the CARL – may be said to be absolute.

The second requirement – that a zoning ordinance, in order to validly reclassify land, must have
been approved by the HLURB prior to 15 June 1988 – is the result of Letter of Instructions No.
729, dated 9 August 1978. According to this issuance, local governments are required to submit
their existing land use plans, zoning ordinances, enforcement systems and procedures to the
Ministry of Human Settlements – one of the precursor agencies of the HLURB – for review and
ratification.