R.A.

6657

NATALIA REALTY, INC., AND ESTATE DEVELOPERS AND INVESTORS CORP. vs.
DEPARTMENT OF AGRARIAN REFORM, SEC. BENJAMIN T. LEONG and DIR. WILFREDO LEANO, DAR
REGION IV 225 SCRA 278

FACTS:

Natalia Realty, Inc. owns three contiguous parcels of land located in Banaba, Antipolo, Rizal,
with areas of 120.9793 hectares, 1.3205 hectares and 2.7080 hectares, or a total of 125.0078
hectares, and embraced in Transfer Certificate of Title No. 31527 of the Register of Deeds of the
Province of Rizal. On 18 April 1979, Presidential Proclamation No. 1637 set aside 20,312 hectares of
land located in the Municipalities of Antipolo, San Mateo and Montalban 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. Estate
Developers and Investors Corporation as developer of NATALIA properties, applied for and was
granted preliminary approval and locational clearances by the Human Settlements Regulatory
Commission. The necessary permit for Phase I of the subdivision project was issued sometime in
1982, for Phase II on 13 October 1983, and for Phase III on 25 April 1986. Petitioner were likewise
issued development permits after complying with the requirements. Thus the NATALIA properties
later became the Antipolo Hills Subdivision. On 15 June 1988, R.A. 6657, otherwise known as the
"Comprehensive Agrarian Reform Law of 1988" went into effect. Upon compliance with such law,
respondent DAR issued on 22 November 1990 a Notice of Coverage on the undeveloped portions of
the Antipolo Hills Subdivision which consisted of roughly 90.3307 hectares. NATALIA immediately
registered its objection to the notice of Coverage. NATALIA and EDIC both impute grave abuse of
discretion to respondent DAR for including underdeveloped portions of the Antipolo Hills Subdivision
within the coverage of the CARL. They argue that NATALIA properties already ceased to be
agricultural lands when they were included in the areas reserved by presidential fiat for the town
site reservation.

ISSUE:

Whether or not the NATALIA lands which are the undeveloped portions of the Antipolo Hills
Subdivision shall be considered as "agricultural lands” and therefore falling under the coverage of
the CARL.

RULING:

Such lands of NATALIA realty are not covered by R.A. 6657, otherwise known as the
Comprehensive Agrarian Reform Law of 1988. Section 4 of R.A. 6657 provides that the CARL shall
"cover, regardless of tenurial arrangement and commodity produced, all public and private
agricultural lands." As to what constitutes "agricultural land," it is referred to as "land devoted to
agricultural activity as defined in this Act and not classified as mineral, forest, residential, commercial
or industrial land." The deliberations of the Constitutional Commission confirm this limitation.
"Agricultural lands" are only those lands which are "arable and suitable agricultural lands" and "do
not include commercial, industrial and residential lands." 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. 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. As defined by DAR,
Agricultural lands refers to those devoted to agricultural activity as defined in R.A. 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. 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.