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G.R. No. 170685, September 22, 2010

Enrique Livioco (Livioco) was the owner of sugarland located in Mabalacat,

Pampanga. He then offered his sugarland to the Department of Agrarian
Reform (DAR) for acquisition.

The voluntary-offer-to-sell (VOS) form he submitted to the DAR indicated that

his property is adjacent to residential subdivisions and to an international
paper mill. The DAR referred Liviocos offer to the Land Bank of the
Philippines for valuation.

Livioco was then promptly informed of the valuation and that the cash portion
of the claim proceeds have been kept in trust pending his submission of the
ownership documentary requirements. However, Livioco did not act upon the
notice given to him by both government agencies.

LBP then issued a certification to the Register of Deeds of Pampanga as

compensation for Liviocos hectares. Thereafter, the DAR proceeded to take
possession of Liviocos property and awarded Certificates of Land Ownership
Award (CLOAs) covering Liviocos property to 26 qualified farmerbeneficiaries.

Two years later Livioco requested for a reevaluation of the compensation on

the ground that its value had already appreciated from the time it was first
offered for sale. The request was denied by Regional Director Antonio Nuesa
on the ground that there was already a perfected sale.

Livioco filed separate complaints to cancel the CLOAs and to recover his
property but the same proved futile. Unable to recover his property but
unwilling to accept what he believes was an outrageously low valuation of his
property, Livioco filed a petition for judicial determination of just
compensation against DAR,LBP, and the CLOA holders Regional Trial Court
(RTC) of Angeles City.

He maintained that the area where his property is located has become
predominantly residential hence he should be paid his propertys value as
such. To prove that his property is now residential, Livioco presented a
Certification from the Office of the Municipal Planning and Development
Coordinator of the Municipality of Mabalacat that, as per zoning ordinance,

Liviocos land is located in an area where the dominant land use is

Was the compensation for respondents property determined in accordance
with law?

Law involved:
RA 6655 Sec. 17. Determination of Just Compensation. In determining just
compensation, the cost of acquisition of the land, the current value of the like
properties, its nature, actual use and income, the sworn valuation by the
owner, the tax declarations, and the assessments 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.

The Supreme Court held that the lower courts erred in ruling that the
character or use of the property has changed from agricultural to residential,
because there is no allegation or proof that the property was approved for
conversion to other uses by DAR.

It is the DAR that is mandated by law to evaluate and to approve land use
conversions so as to prevent fraudulent evasions from agrarian reform
coverage. Even reclassification and plans for expropriation by local
government units (LGUs) will not ipso facto convert an agricultural property
to residential, industrial or commercial.

Thus, in the absence of any DAR approval for the conversion of respondents
property or an actual expropriation by an LGU, it cannot be said that the
character or use of said property changed from agricultural to residential.
Respondents property remains agricultural and should be valued as such.

I agree with the ruling of the Supreme Court. For purposes of just compensation,
the fair market value of an expropriated property is determined by its character and
its price at the time of taking. There are three important concepts in this definition
the character of the property, its price, and the time of actual taking. Livioco himself
admitted that his property was agricultural at the time he offered it for sale to DAR
in 1988. It is but proper that the determination of just compensation, a factor of

which is the classification of the property at that time, be computed from the time
of actual taking of the property after a lawful sale done.

Philippine Veterans Bank vs Court of Appeals

GR No. 132767 , January 18, 2000

Philippine Veterans Bank owned four parcels of land in Tagum, Davao which
were taken by the Department of Agrarian Reform for distribution to landless
farmers pursuant to the Comprehensive Agrarian Reform Law (R.A. No. 6657).

Dissatisfied with the valuation of the Land Bank of the Philippines and the
DARAB, petitioner filed a petition for determination of the just compensation
for its property with the Regional Trial Court, Branch 2, Tagum, Davao on
January 1994.

The RTC dismissed the petition on the ground that it was filed beyond the 15day reglamentary period for filing appeals from the orders of the DARAB. The
Decision was affirmed by the Court of Appeals.

Are Special Agrarian Courts considered appellate courts in the determination
of just compensation?
Law involved:
Rule XIII, Section 11 of the DARAB Rules of Procedure
"Land Valuation and Preliminary Determination and Payment of Just
Compensation. The decision of the adjudicator on land valuation and
preliminary determination and payment of just compensation shall not be
appealable to the Board but shall be brought directly to the Regional Trial
Courts designated as Special Agrarian Courts within fifteen (15) days from
receipt of the notice thereof. Any party shall be entitled to only one motion
for reconsideration."

No. As the Supreme Court held in Republic vs. Court of Appeals, this Rule is
an acknowledgement by the DARAB that the power to decide just
compensation cases for the taking of lands under R.A. No. 6657 is vested in
the Courts. The jurisdiction of the Regional Trial Courts is not any less
"original and exclusive" because the question is first passed upon by the DAR,
as the judicial proceedings are not a continuation of the administrative
determination. For that matter, the law may provide that the decision of the

DAR is final and unappealable. Nevertheless, resort to the courts cannot be

foreclosed on the theory that courts are the guarantors of the legality of
administrative action.

Accordingly, as the petition in the Regional Trial Court was filed beyond the
15-day period provided in Rule XIII, 11 of the Rules of Procedure of the
DARAB, the trial court correctly dismissed the case and the Court of Appeals
correctly affirmed the order of dismissal.

I agree with the ruling of the Supreme Court. It is error to think that, because
of Rule XIII, Sec. 11, the original and exclusive jurisdiction given to the courts
to decide petitions for determination of just compensation has thereby been
transformed into an appellate jurisdiction. It simply means that, in
accordance with settled principles of administrative law, primary jurisdiction
is vested in the DAR as an administrative agency to determine in a
preliminary manner the reasonable compensation to be paid for the lands
taken under the Comprehensive Agrarian Reform Program, but such
determination is subject to challenge in the courts.
Rupa vs Court of Appeals and Salipot
GR No. 80129 , January 25, 2000


Gerardo Rupa Sr. filed an action for redemption with damages against Magin
Salipot claiming that he had been a tenant of a parcel of coconut land
formerly owned by Vicente Lim and Patrocinia Yu Lim for more than twenty
(20) years now, sharing the harvests on a 50%-50% basis.

Also, that he is the overseer over four parcels of coconut land owned by the
Lim spouses. However, without any prior written notice, the land tenanted by
the petitioner was sold to Magin Salipot for P5,000.00 in January 1981.

Rupa averred that he only learned of the sale on February 16, 1981, and that
he sought assistance with the local office of Agrarian Reform for the
redemption of the questioned property and even deposited the amount of
P5,000.00 with the trial court.

However, the Regional Trial Court of Masbate rendered a decision dismissing

the complaint on the ground that Rupa was not a tenant of the subject
property and thus, not entitled to a right of redemption over the same.

On appeal, the Court of Appeals finds, in substance, that there is no clear and
convincing evidence to show that plaintiff was a share tenant of the spouses

Lim and that Rupa is bound by his admission in Criminal Case No. 532-U,
entitled People of the Philippines. vs. Mariano Luzong filed six months after
the instant case wherein he admitted that he was the overseer and
administrator of the five parcels of land owned by the Lim spouses.

Thus, negating his claim of tenancy. The CA therefore affirmed on appeal the
decision of the lower court. Hence, this petition seeking the reversal of the
Decision of the Court of Appeals.

Is the petitioner is a lawful tenant of the land entitled to the right of
redemption or a mere
overseer thereof?
Law involved:
Section 5 (a) of Republic Act No. 1199
Definitions of Terms. - As used in this Act:
(a) A tenant shall mean 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

The Supreme Court held that indeed Rupa is a tenant and hence he is entitled
to the right of redemption. It found that there are compelling reasons for it to
apply the exception of non-conclusiveness of the factual findings of the trial
and appellate courts on the ground that the "findings of fact of both courts is
premised on the supposed absence of evidence but is in actuality
contradicted by evidence on record."

For a tenant-landowner relationship to exist, it is necessary that:


The parties are the landowner and the tenant;

The subject is agricultural land;
There is consent;
The purpose is agricultural production;
There is personal cultivation; and
There is sharing of harvests.

The fact that RUPA has been planting coconut seedlings and minor crops in
the vacant portions of the subject land as well as cleaning and gathering
coconuts to process them into copra is borne out by the records. Further
indicating the tenancy relationship between the landlord and RUPA is their
agreement to share 50/50. The sharing arrangement taken together with
other factors characteristic of tenancy shown to be present in the case at bar,
strengthens the claim of RUPA that indeed, he is a tenant.

I agree with the ruling of the Supreme Court. Under common usage, when an
administrator /overseer is at the same time a tenant, the term administrator
can be used interchangeably with tenancy. Upon proof of the existence of the
tenancy relationship, Rupa could avail of the benefits afforded by R.A. No.
3844. As correctly pointed out by the CA, this right of redemption is validly
exercised upon compliance with the following requirements: a) the
redemptioner must be an agricultural lessee or share tenant; b) the land
must have been sold by the owner to a third party without prior written
notice of the sale given to the lessee or lessees; c) only the area cultivated
by the agricultural lessee may be redeemed; d) the right of redemption must
be exercised within 180 days from notice; and e) there must be an actual
tender or valid consignation of the entire amount which is the reasonable
price of the land sought to be redeemed.

Heirs of Daez vs Court of Appeals et al.

GR No. 133507, February 17, 2000


Eudosia Daez applied for exemption of her 4.1685 hectare riceland in Brgy.
Lawa, Meycauayan, Bulacan being cultivated by the herein respondents. DAR
Undersecretary Jose C. Medina denied the application for exemption upon
finding that the subject land is covered under LOI 474, the petitioner's total
properties having exceeded the 7-hectare limit provided by law.

The Secretary of DAR, Benjamin T. Leong, the Court of Appeals and the
Supreme Court all affirmed the said Order and disregarded an Affidavit
executed 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
the meantime, 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. Bernardo allowed
her to retain the subject riceland but denied the application of her children to
retain three (3) hectares each for failure to prove actual tillage or direct
management thereof.

This order was set aside by the DAR Secretary Ernesto Garilao but reinstated
on appeal by the Office of the President. The Court of Appeals again reversed
this Decision and ordered the reinstatement of the previous Decision of DAR
Secretary Ernesto D. Garilao. Hence, this Appeal.

Can Daez still file a petition for retention of the subject landholdings, despite
the fact that a previous decision denying the petition for exemption had long
become final and executory?
Law involved:
Sec. 6 R.A. No. 6657
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,
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. Xxx
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 or another agricultural land with similar or comparable features. In
case the tenant chooses to remain in the retained area, he shall be
considered a 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 lease-holder to the land retained by the
landowner. The tenant must exercise this option within a period of one (1)
year from the time the landowner manifests his choice of the area for

Yes. The Supreme Court has held that it is incorrect to posit that
application for exemption and an application for retention are one and
same thing. Being distinct remedies, finality of judgment in one does
preclude the subsequent institution of the other. There was, thus,


procedural impediment to the application filed by Daez for the retention of

the subject 4.1865 hectare riceland, even after her appeal for exemption of
the same land was denied in a decision that became final and executory.

The issuance of EPs and CLOAs to beneficiaries does not absolutely bar the
landowner from retaining the area covered thereby. Under Administrative
Order No. 2, Series of 1994, an EP or CLOA may be cancelled if the land
covered is later found to be part of the landowner's retained area.

I agree with the ruling of the Supreme Court. An application for exemption
and an application for retention are distinct remedies in law. Finality of
judgement in one must not preclude the subsequent institution of the other.
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 landowner and the
tenant by implementing the doctrine that social justice was not meant to
perpetrate an injustice against the landowner. A retained area as its name
denotes, is land which is not supposed to anymore leave the landowner's
dominion, thus, sparing the government from the inconvenience of taking
land only to return it to the landowner afterwards, which would be a pointless

Hacienda Luisita Inc. (HLI) v. Presidential Agrarian Reform Council (PARC),

et al.
G.R. No. 171101, November 22, 2011

On July 5, 2011, the Supreme Court en banc voted unanimously (11-0) to

DISMISS/DENY the petition filed by HLI and AFFIRM with MODIFICATIONS the
resolutions of the PARC revoking HLIs Stock Distribution Plan (SDP) and
placing the subject lands in Hacienda Luisita under compulsory coverage of
the Comprehensive Agrarian Reform Program (CARP) of the government.

The Court however did not order outright land distribution. Voting 6-5, the
Court noted that there are operative facts that occurred in the interim and
which the Court cannot validly ignore. Thus, the Court declared that the
revocation of the SDP must, by application of the operative fact principle,
give way to the right of the original 6,296 qualified farmworkers-beneficiaries
(FWBs) to choose whether they want to remain as HLI stockholders or
[choose actual land distribution].

It thus ordered the Department of Agrarian Reform (DAR) to immediately

schedule meetings with the said 6,296 FWBs and explain to them the effects,
consequences and legal or practical implications of their choice, after which
the FWBs will be asked to manifest, in secret voting, their choices in the
ballot, signing their signatures or placing their thumbmarks, as the case may
be, over their printed names.

The parties thereafter filed their respective motions for reconsideration of the
Court decision.

Should the ruling in the July 5, 2011 Decision that the qualified FWBs be given
an option to remain as stockholders of HLI be reconsidered?

Law Involved:
Sec. 3, RA 6657
Definitions. For the purpose of this Act, unless the context indicates
(a) Agrarian Reform means redistribution of lands, regardless of crops
or fruits produced, to farmers and regular farmworkers who are
landless, irrespective of tenurial arrangement, to include the totality of
factors and support services designed to lift the economic status of the
beneficiaries and all other arrangements alternative to the physical
redistribution of lands, such as production or profit-sharing, labor
administration, and the distribution of shares of stocks, which will allow
beneficiaries to receive a just share of the fruits of the lands they work.


YES, the ruling in the July 5, 2011 Decision that the qualified FWBs be given
an option to remain as stockholders of HLI should be reconsidered.

The Court reconsidered its earlier decision that the qualified FWBs should be
given an option to remain as stockholders of HLI, inasmuch as these qualified
FWBs will never gain control [over the subject lands] given the present
proportion of shareholdings in HLI.

The Court noted that the share of the FWBs in the HLI capital stock is [just]
33.296%. Thus, even if all the holders of this 33.296% unanimously vote to
remain as HLI stockholders, which is unlikely, control will never be in the
hands of the FWBs.

Control means the majority of [sic] 50% plus at least one share of the
common shares and other voting shares. Applying the formula to the HLI
stockholdings, the number of shares that will constitute the majority is
295,112,101 shares (590,554,220 total HLI capital shares divided by 2 plus
one [1] HLI share). The 118,391,976.85 shares subject to the SDP approved
by PARC substantially fall short of the 295,112,101 shares needed by the
FWBs to acquire control over HLI.]

I agree with the ruling of the Supreme Court. RA 6657 has been enacted
precisely pursuant to and as a mechanism to carry out its constitutional
directives. This piece of legislation, in fact, restates the agrarian reform policy
established in the aforementioned provision of the Constitution of promoting
the welfare of landless farmers and farmworkers.
RA 6657 thus defines "agrarian reform" as "the redistribution of lands to
farmers and regular farmworkers who are landless to lift the economic
status of the beneficiaries and all other arrangements alternative to the
physical redistribution of lands, such as production or profit sharing, labor
administration and the distribution of shares of stock which will allow
beneficiaries to receive a just share of the fruits of the lands they work."
Hence, the qualified farmworkers beneficiaries has the right to choose from
amongst the options given by law to them.