Sigre vs. Court of Appeals

SUPREME COURT REPORTS ANNOTATED VOLUME 387 24/06/2019, 1*17 PM
VOL. 387, AUGUST 8, 2002 15

Sigre vs. Court of Appeals
*
G.R. No. 109568. August 8, 2002.
ROLANDO SIGRE, petitioner, vs. COURT OF APPEALS

and LILIA Y. GONZALES, as co-administratrix of the
Estate of Matias Yusay, respondents.
*
G.R. No. 113454. August 8, 2002.
LAND BANK OF THE PHILIPPINES, petitioner, vs.

COURT OF APPEALS and LILIA Y. GONZALES, as co-
administratrix of the Estate of Matias Yusay, respondents.
Agrarian Reform; Statutes; Presidential Decree No. 27;

Presidential Decree No. 27, issued on 21 October 1972 by then Pres.
Ferdinand E. Mar-
_______________
51 Zamudio v. Peñas, 286 SCRA 367, 375 [1998], citing Nicolas v. Judge
Yuzon, A.M. No. RTJ-89-303, 15 August 1990.
* FIRST DIVISION.
16
16 SUPREME COURT REPORTS ANNOTATED
http://www.central.com.ph/sfsreader/session/0000016b87e832d6cff1f867003600fb002c009e/p/AQM958/?username=Guest Page 1 of 20
cos, proclaimed the entire country as a „land reform area‰ and

decreed the emancipation of tenants from the bondage of the soil,
transferring to them the ownership of the land they till.·
Presidential Decree No. 27, issued on October 21, 1972 by then
Pres. Ferdinand E. Marcos, proclaimed the entire country as a „land
reform area‰ and decreed the emancipation of tenants from the
bondage of the soil, transferring to them the ownership of the land
they till. To achieve its purpose, the decree laid down a system for
the purchase by tenant-farmers, long recognized as the backbone of
the economy, of the lands they were tilling. Owners of rice and corn
lands that exceeded the minimum retention area were bound to sell
their lands to qualified farmers at liberal terms and subject to
conditions. It was pursuant to said decree that the DAR issued
Memorandum Circular No. 6, series of 1978.
Same; Same; Same; Administrative Law; The power of
subordinate legislation allows administrative bodies to implement
the broad policies laid down in a statute by „filling in‰ the details,
and all that is required is that the regulation should be germane to
the objects and purposes of the law and that the regulation be not in
contradiction to but in conformity with the standards prescribed by
the law.·The power of subordinate legislation allows
administrative bodies to implement the broad policies laid down in
a statute by „filling in‰ the details. All that is required is that the
regulation should be germane to the objects and purposes of the
law; that the regulation be not in contradiction to but in conformity
with the standards prescribed by the law. One such administrative
regulation is DAR Memorandum Circular No. 6. As emphasized in
De Chavez v. Zobel, emancipation is the goal of P.D. 27, i.e., freedom
from the bondage of the soil by transferring to the tenant-farmers
the ownership of the land theyÊre tilling.
Same; Same; Same; Same; Since DAR Memorandum Circular
No. 6 essentially sought to accomplish the noble purpose of P.D. 27,
it is therefore valid and has the force of law.·The rationale for the
Circular was, in fact, explicitly recognized by the appellate court
when it stated that „(T)he main purpose of the circular is to make
certain that the lease rental payments of the tenant-farmer are
applied to his amortizations on the purchase price of the land. x x x
The circular was meant to remedy the situation where the tenant-
farmerÊs lease rentals to landowner were not credited in his favor
against the determined purchase price of the land, thus making him
a perpetual obligor for said purchase price.‰ Since the assailed
Circular essentially sought to accomplish the noble purpose of P.D.

27, it is therefore valid. Such being the case, it has the force of law
and is entitled to great respect.
17
VOL. 387, AUGUST 8, 2002 17
Same; Same; Same; Same; The Court cannot see any

„irreconcilable conflict‰ between P.D. No. 816 and DAR
Memorandum Circular No. 6.·The Court cannot see any
„irreconcilable conflict‰ between P.D. No. 816 and DAR
Memorandum Circular No. 6. Enacted in 1975, P.D. No. 816
provides that the tenant-farmer (agricultural lessee) shall pay lease
rentals to the landowner until the value of the property has been
determined or agreed upon by the landowner and the DAR. On the
other hand, DAR Memorandum Circular No. 6, implemented in
1978, mandates that the tenant-farmer shall pay to LBP the lease
rental after the value of the land has been determined.
Same; Same; Same; Same; Both Memorandum Circular No. 6
and P.D. 816 were issued pursuant to and in implementation of P.D.
27·these must not be read in isolation, but rather, in conjunction
with each other.·Private respondent, however, „splits hairs,‰ so to
speak, and contends that the Curso case is premised on the
assumption that the Circular implements P.D. 816, whereas it is
expressly stated in the Circular that it was issued in
implementation of P.D. 27. Both Memorandum Circular No. 6 and
P.D. 816 were issued pursuant to and in implementation of P.D. 27.
These must not be read in isolation, but rather, in conjunction with
each other. Under P.D. 816, rental payments shall be made to the
landowner. After the value of the land has been
determined/established, then the tenant-farmers shall pay their
amortizations to the LBP, as provided in DAR Circular No. 6.
Clearly, there is no inconsistency between them. Au contraire, P.D.
816 and DAR Circular No. 6 supplement each other insofar as it
sets the guidelines for the payments of lease rentals on the
agricultural property.
Same; Same; Same; That P.D. 27 does not suffer any
constitutional infirmity is a judicial fact that has been repeatedly
emphasized by the Supreme Court.·Further, that P.D. 27 does not

suffer any constitutional infirmity is a judicial fact that has been
repeatedly emphasized by this Court in a number of cases. As early
as 1974, in the aforecited case of De Chavez v. Zobel, P.D. 27 was
assumed to be constitutional, and upheld as part and parcel of the
law of the land, viz.: „There is no doubt then, as set forth expressly
therein, that the goal is emancipation. What is more, the decree is
now part and parcel of the law of the land according to the revised
Constitution itself. Ejectment therefore of petitioners is simply out
of the question. That would be to set at naught an express mandate
of the Constitution. Once it has spoken, our duty is clear; obedience
is unavoidable. This is not only so because of the cardinal postulate
of constitutionalism, the supremacy of the fundamental law. It is
also because any other approach would run the risk of setting at
naught this basic aspiration to do away with all remnants of a
feudalistic order at war with the promise
18
and the hope associated with an open society. To deprive petitioners

of the small landholdings in the face of a presidential decree
considered ratified by the new Constitution and precisely in
accordance with its avowed objective could indeed be contributory to
perpetuating the misery that tenancy had spawned in the past as
well as the grave social problems thereby created. There can be no
justification for any other decision then whether predicated on a
juridical norm or on the traditional role assigned to the judiciary of
implementing and not thwarting fundamental policy goals.‰
Same; Same; Same; Eminent Domain; Just Compensation; The
determination of just compensation under P.D. No. 27, like in
Section 16 (d) of R.A. 6657 or the CARP Law, is not final or
conclusive·unless both the landowner and the tenant-farmer accept
the valuation of the property by the Barrio Committee on Land
Production and the DAR, the parties may bring the dispute to court
in order to determine the appropriate amount of compensation, a
task unmistakably within the prerogative of the court.·The
determination of just compensation under P.D. No. 27, like in

Section 16 (d) of R.A. 6657 or the CARP Law, is not final or
conclusive. This is evident from the succeeding paragraph of Section
2 of E.O. 228: „x x x In the event of dispute with the landowner
regarding the amount of lease rental paid by the farmer beneficiary,
the Department of Agrarian Reform and the Barangay Committee
on Land Production concerned shall resolve the dispute within
thirty (30) days from its submission pursuant to Department of
Agrarian Reform Memorandum Circular No. 26, series of 1973, and
other pertinent issuances. In the event a party questions in court
the resolution of the dispute, the landownerÊs compensation shall
still be processed for payment and the proceeds shall be held in
trust by the Trust Department of the Land Bank in accordance with
the provisions of Section 5 hereof, pending the resolution of the
dispute before the court.‰ Clearly therefrom, unless both the
landowner and the tenant-farmer accept the valuation of the
property by the Barrio Committee on Land Production and the
DAR, the parties may bring the dispute to court in order to
determine the appropriate amount of compensation, a task
unmistakably within the prerogative of the court.
Same; Same; Same; Republic Act No. 6657; The Court need not
belabor the fact that R.A. 6657 or the CARP Law operates distinctly
from P.D. 27·R.A. 6657 did not repeal or supersede, in any way,
P.D. 27; While R.A. 6657 covers all public and private agricultural
lands including other lands of the public domain suitable for
agriculture as provided for in Proclamation No. 131 and Executive
Order No. 229, P.D. 27 covers rice and corn lands.·The Court need
not belabor the fact that R.A. 6657 or the CARP Law operates
distinctly from P.D. 27. R.A. 6657 covers all public and private
agricultural land including other lands of the public domain suit-
19
VOL. 387, AUGUST 8, 2002 19
able for agriculture as provided for in Proclamation No. 131 and

Executive Order No. 229; while, P.D. 27 covers rice and corn lands.
On this score, E.O. 229, which provides for the mechanism of the
Comprehensive Agrarian Reform Program, specifically states:

„(P)residential Decree No. 27, as amended, shall continue to operate
with respect to rice and corn lands, covered thereunder. x x x‰ It
cannot be gainsaid, therefore, that R.A. 6657 did not repeal or
supersede, in any way, P.D. 27. And whatever provisions of P.D. 27
that are not inconsistent with R.A. 6657 shall be suppletory to the
latter, and all rights acquired by the tenant-farmer under P.D. 27
are retained even with the passage of R.A. 6657.
PETITIONS for review on certiorari of a decision of the

Court of Appeals.
The facts are stated in the opinion of the Court.

Miguel Gonzales, Norberto L. Martinez and Danilo
Beramo for petitioner in G.R. No. 113454.
Delfin B. Samson for petitioners in G.R. No. 109568.
Ramon Gonzales for respondent L. Gonzales.
AUSTRIA-MARTINEZ, J.:
In a not-so-novel attempt to challenge the long-settled

constitutionality of Presidential Decree No. 27, private
respondent Lilia Y. Gonzales, as co-administratrix of the
Estate of Matias Yusay, filed with the Court of Appeals on
September 15, 1992, a petition for prohibition and
mandamus docketed as CA-G.R. SP No. 28906, seeking to
prohibit the Land Bank of the Philippines (LBP) from
accepting the leasehold rentals from Ernesto Sigre
(predecessor of petitioner Rolando Sigre), and for LBP to
turn over to private respondent the rentals previously
remitted to it by Sigre. It appears that Ernesto Sigre was
private respondentÊs tenant in an irrigated rice land located
in Barangay Naga, Pototan, Iloilo. He was previously
paying private respondent a lease rental of sixteen (16)
cavans per crop or thirty-two (32) cavans per agricultural
year. In the agricultural year of 1991-1992, Sigre stopped
paying his rentals to private respondent and instead,
remitted it to the LBP pursuant to the Department of
Agrarian ReformÊs Memorandum Circular No. 6, Series of
1978, which set the guidelines in the payment
20

of lease rental/partial payment by farmer-beneficiaries

under the land transfer program of P.D. No. 27. The
pertinent provision of the DAR Memorandum Circular No.
6 reads:
„A. Where the value of the land has already been
established.
„The value of the land is established on the date the Secretary or

his authorized representative has finally approved the average
gross production data established by the BCLP or upon the signing
of the LTPA by landowners and tenant farmers concerned
heretofore authorized.
„Payment of lease rentals to landowners covered by OLT shall
terminate on the date the value of the land is established. Thereafter,
the tenant-farmers shall pay their lease rentals/amortizations to the
LBP or its authorized agents: provided that in case where the value
of the land is established during the month the crop is to be
harvested, the cut-off period shall take effect on the next harvest
season. With respect to cases where lease rentals paid may exceed
the value of the land, the tenant-farmers may no longer be bound to
pay such rental, but it shall be his duty to notify the landowner and
the DAR Team Leader concerned of such fact who shall ascertain
immediately the veracity of the information and thereafter resolve
the matter expeditiously as possible. If the landowner shall insist
after positive ascertainment that the tenant-farmer is to pay
rentals to him, the amount equivalent to the rental insisted to be
paid shall be deposited by the tenant-farmer with the LBP or its
authorized agent in his name and for his account to be withdrawn
only upon proper written authorization of the DAR District Officer
1
based on the result of ascertainment or investigation.‰ (Emphasis
ours)
According to private respondent, she had no notice that the

DAR had already fixed the 3-year production prior to2
October 1972 at an average of 119.32 cavans per hectare,
and the value of the land was pegged at Thirteen Thousand
Four Hundred 3
Five Pesos and Sixty-Seven Centavos
(P13,405.67). Thus, the petition filed before the Court of
Appeals, assailing, not only the validity of Memorandum
Circular No. 6, but also the constitutionality of P.D. 27.

The appellate court, in its decision dated March 22,
1993, gave due course to the petition and declared
Memorandum Circular No.
_______________
1 Rollo, CA-G.R. SP No. 28906, pp. 25-26, Annex „C‰.

2 Ibid., p. 23, Annex „A‰.
3 Ibid., p. 24, Annex „B‰.
21
VOL. 387, AUGUST 8, 2002 21

4
6 null and void. The LBP was directed to return to private
respondent the lease rentals paid by Sigre, while Sigre was5
directed to pay the rentals directly to private respondent.
In declaring Memorandum Circular No. 6 as null and void,
the appellate court ruled that there is nothing in P.D. 276
which sanctions the contested provision of the circular;
that said circular is in conflict with P.D. 816 which provides
that payments of lease rentals shall be made to the
landowner, and the7
latter, being a statute, must prevail
over the circular; that P.D. 27 is unconstitutional in laying
down the formula for determining the cost of the land as it
sets limitations on8 the judicial prerogative of determining
just compensation; and that it is no longer9
applicable, with
the enactment of Republic Act No. 6657.
Hence, this present recourse, which is a consolidation of
the separate petitions for review filed by Rolando Sigre
(who substituted his predecessor Ernesto Sigre), docketed
as G.R. No. 109568 and the LBP, docketed as G.R. No.
113454.
Petitioner Sigre, in G.R. No. 109568, alleges that:
„I
„PUBLIC RESPONDENT COURT OF APPEALS ACTED WITH

GRAVE ABUSE OF DISCRETION IN RULING THAT DAR
MEMORANDUM CIRCULAR NO. 6, SERIES OF 1978 RUNS
COUNTER TO PRESIDENTIAL DECREE NO. 816.
„II
„PUBLIC RESPONDENT ERRED IN RULING THAT DAR

MEMORANDUM CIRCULAR NO. 6, SERIES OF 1978 AMENDS
OR EXPANDS PRESIDENTIAL DECREE NO. 27.
_______________
4Ibid., p. 80.
5Ibid., p. 92.
6Ibid., pp. 86-87.
7Ibid., p. 88.
8Ibid., pp. 89-90.
9Ibid., p. 92.
22

„III
„PUBLIC RESPONDENT ERRED IN RULING THAT PROVISION

OF PRESIDENTIAL DECREE NO. 27 ON THE FORMULA FOR
DETERMINING THE COST OF THE LAND IS
UNCONSTITUTIONAL.
„IV
„PUBLIC RESPONDENT ERRED IN RULING THAT THE

PROVISION OF PRESIDENTIAL DECREE NO. 27 ON FIXING
THE JUST COMPENSATION OF THE LAND HAS BEEN
10
REPEALED BY REPUBLIC ACT NO. 6657.‰
Petitioner LBP, in G.R. No. 113454, claims that:
„A
„THE COURT OF APPEALS GRAVELY ERRED IN NOT FINDING

THAT MAR CIRCULAR NO. 6 IS A VALID PIECE OF
ADMINISTRATIVE RULES AND REGULATION COVERING A
SUBJECT GERMANE TO THE OBJECTS AND PURPOSES OF
PRESIDENTIAL DECREE NO. 27, CONFORMING TO THE

STANDARDS OF SAID LAW AND RELATING SOLELY TO
CARRYING INTO EFFECT THE GENERAL PROVISIONS OF
SAID LAW.
„B
„THE COURT OF APPEALS SERIOUSLY ERRED IN RULING

THAT MAR CIRCULAR NO. 6 IS INVALID IN THAT IT SUFFERS
ÂIRRECONCILABLE CONFLICTÊ WITH PRESIDENTIAL
DECREE NO. 816, THUS GROSSLY DISREGARDING THE
APPLICABLE DECISION OF THE SUPREME COURT THAT
THERE IS NO ÂINCONSISTENCY OR INCOMPATIBILITYÊ
BETWEEN MAR CIRCULAR NO. 6 AND P.D. 816.
„C
„THE COURT OF APPEALS GRAVELY ERRED IN RULING

THAT P.D. 27, INSOFAR AS IT SETS FORT (sic) THE FORMULA
FOR DETERMINING THE VALUE OF THE RICE/CORN LAND,
IS UNCONSTITUTIONAL, THUS GROSSLY DISREGARDING
THE EXISTING JURISPRUDENCE THAT CONSISTENTLY
RULED THAT P.D. 27 IS SUS-
_______________
10 Rollo, G.R. No. 109568, p. 4.
23
VOL. 387, AUGUST 8, 2002 23

TAINED AGAINST ALL CONSTITUTIONAL OBJECTIONS

RAISED AGAINST IT.
„D
„THE COURT OF APPEALS GRAVELY ERRED IN FINDING

THAT P.D. 27 HAS BEEN IMPLIEDLY REPEALED BY
11
REPUBLIC ACT NO. 6657.‰
12
Presidential Decree No. 27, issued on October 21, 1972 by
then Pres. Ferdinand E. Marcos, proclaimed the entire
country as a „land reform area‰ and decreed the

emancipation of tenants from the bondage of the soil,
transferring to them the ownership of the land they till. To
achieve its purpose, the decree laid down a system for the
purchase by tenant-farmers, long recognized as the
backbone of the economy, of the lands they were tilling.
Owners of rice and corn lands that exceeded the minimum
retention area were bound to sell their lands to qualified
13
farmers at liberal terms and subject to conditions. It was
pursuant to said decree that the DAR issued Memorandum
Circular No. 6, series of 1978.
The Court of Appeals held that P.D. No. 27 does not
sanction said Circular, particularly, the provision stating
that payment of lease rentals to landowners shall
terminate on the date the value of the land is established,
after which the tenant-farmer shall pay their lease
rentals/amortizations to the LBP or its authorized agents.
We disagree. The power of subordinate legislation allows
administrative bodies to implement the broad policies laid
down in a statute by „filling in‰ the details. All that is
required is that the regulation should be germane to the
objects and purposes of the law; that the regulation be not
in contradiction to but14
in conformity with the standards
prescribed by the law. One such administra-
_______________
11 Rollo, G.R. 113454, pp. 9-10.

12 Entitled, „Decreeing the Emancipation of Tenants from the Bondage
of the Soil Transferring to Them the Ownership of the Land they Till and
Providing the Instruments and Mechanism therefore.‰
13 Pagtalunan v. Tamayo, 183 SCRA 252, 258 [1990].
14 The Conference of Maritime Manning Agencies, Inc. vs. POEA, 243
SCRA 666, 675 [1995].
24

tive regulation is DAR Memorandum15

Circular No. 6. As
emphasized in De Chavez v. Zobel, emancipation is the
goal of P.D. 27, i.e., freedom from the bondage of the soil by
transferring to the tenant-farmers the ownership of the
land theyÊre tilling. As noted, however, in the whereas
clauses of the Circular, problems have been encountered in
the expeditious implementation of the land reform
program, thus necessitating its promulgation, viz.:
„1. Continued payment of lease rentals directly to

landowners by tenant-farmers may result to
situations wherein payments made may even
exceed the actual value of the land. x x x
„2. There is difficulty in recording lease rental
payments made by tenant-farmers to landowners
specifically in cases where landowners concerned
refuse to issue acknowledgment/official receipts for
payments made;
„3. Payments made by tenant-farmers to landowners
after the establishment of Farmer Amortization
Schedule (FAS) through the National Computer
Center were found to be ineffectively captured or
accounted for. x x x
„4. The prolonged disagreement between parties
concerned on the total payments made by the
tenant-farmers has delayed program
implementations.‰
The rationale for the Circular was, in fact, explicitly

recognized by the appellate court when it stated that „(T)he
main purpose of the circular is to make certain that the
lease rental payments of the tenant-farmer are applied to
his amortizations on the purchase price of the land. x x x
The circular was meant to remedy the situation where the
tenant-farmerÊs lease rentals to landowner were not
credited in his favor against the determined purchase price
of the land, thus16 making him a perpetual obligor for said
purchase price.‰ Since the assailed Circular essentially
sought to accomplish
17
the noble purpose of P.D. 27, it is
therefore valid. Such being the18 case, it has the force of law
and is entitled to great respect.
_______________
15 55 SCRA 26 [1974].
16 Rollo, CA-G.R. SP No. 28906, pp. 87-88.
17 Grego vs. Commission on Elections, 274 SCRA 481, 498 [1997].
18 Vinzons-Magana vs. Estrella, 201 SCRA 536, 540 [1991].
25
VOL. 387, AUGUST 8, 2002 25

The Court cannot

19
see any „irreconcilable conflict‰ between
P.D. No. 816 and DAR Memorandum Circular No. 6.
Enacted in 1975, P.D. No. 816 provides that the tenant-
farmer (agricultural lessee) shall pay lease rentals to the
landowner until the value of the property has been
determined or agreed upon by the landowner and the DAR.
On the other hand, DAR Memorandum Circular No. 6,
implemented in 1978, mandates that the tenant-farmer
shall pay to LBP the lease rental after the value of the land
has been determined. 20
In Curso v. Court of Appeals, involving the same
Circular and P.D. 816, it was categorically ruled that there
is no incompatibility between these two. Thus:
„Actually, we find no inconsistency nor incompatibility between

them. Of significance are the two ÂwhereasÊ clauses of P.D. 816
quoted hereunder:
xxx
Clearly, under P.D. No. 816, rentals are to be paid to the
landowner by the agricultural lessee until and after the valuation of
the property shall have been determined.
In the same vein, the MAR Circular provides:
xxx
In other words, the MAR Circular merely provides guidelines in
the payment of lease rentals/amortizations in implementation of
P.D. 816. Under both P.D. 816 and the MAR Circular, payment of
lease rentals shall terminate on the date the value of the land is
established. Thereafter, the tenant farmers shall pay amortizations
to the Land Bank (LBP). The rentals previously paid are to be
credited as partial payment of the land transferred to tenant-
21
farmers.‰
Private respondent, however, „splits hairs,‰ so to speak,

and contends that the Curso case is premised on the
assumption that the Circular implements P.D. 816,
whereas it is expressly stated in the
_______________
19 Presidential Decree No. 816 entitled, „Providing that Tenant-

Farmers/Agricultural Lessees Shall Pay the Leasehold Rentals When
They Fall Due and Providing Penalties Therefor,‰ issued on October 21,
1975.
20 128 SCRA 567 [1984].
21 Ibid., pp. 573-574.
26

22
Circular that it was issued in implementation of P.D. 27.
Both Memorandum Circular No. 6 and P.D. 816 were
issued pursuant to and in implementation of P.D. 27. These
must not be read in isolation, but rather, in conjunction
with each other. Under P.D. 816, rental payments shall be
made to the landowner. After the value of the land has
been determined/established, then the tenant-farmers shall
pay their amortizations
23
to the LBP, as provided in DAR
Circular No. 6. Clearly, there is no inconsistency between
them. Au contraire, P.D. 816 and DAR Circular No. 6
supplement each other insofar as it sets the guidelines for
the payments of lease rentals on the agricultural property.
Further, that P.D. 27 does not suffer any constitutional
infirmity is a judicial fact that has been repeatedly
emphasized by this Court in a number of cases. As24early as
1974, in the aforecited case of De Chavez v. Zobel, P.D. 27
was assumed to be constitutional, and upheld as part and
parcel of the law of the land, viz.:
„There is no doubt then, as set forth expressly therein, that the goal
is emancipation. What is more, the decree is now part and parcel of
the law of the land according to the revised Constitution itself.
Ejectment therefore of petitioners is simply out of the question.
That would be to set at naught an express mandate of the

Constitution. Once it has spoken, our duty is clear; obedience is
unavoidable. This is not only so because of the cardinal postulate of
constitutionalism, the supremacy of the fundamental law. It is also
because any other approach would run the risk of setting at naught
this basic aspiration to do away with all remnants of a feudalistic
order at war with the promise and the hope associated with an open
society. To deprive petitioners of the small landholdings in the face
of a presidential decree considered ratified by the new Constitution
and precisely in accordance with its avowed objective could indeed
be contributory to perpetuating the misery that tenancy had
spawned in the past as well as the grave social problems thereby
created. There can be no justification for any other decision then
whether predicated on a juridical norm or on the traditional role
assigned to the judiciary of implementing and not thwarting
25
fundamental policy goals.‰
_______________
22 Rollo, pp. 178-179; Memorandum, pp. 4-5.

23 Supra, Curso vs. Court of Appeals; see also P.D. 816 and DAR
Memorandum Circular No. 6.
24 55 SCRA 26 [1974].
25 Ibid., p. 31.
27
VOL. 387, AUGUST 8, 2002 27

26
Thereafter, in Gonzales v. Estrella, which incidentally
involves private respondent and counsel in the case at
bench, the Court emphatically declared that „Presidential 27
Decree No. 27 has survived the test of constitutionality.‰
Then, in 1982, P.D. 27, once again, was stamped with
judicial imprimatur in Association of Rice & Corn
Producers of the28 Philippines, Inc. v. The National Land
Reform Council, to wit:
„x x x If as pointed out in the opening paragraph, the validity of

Presidential Decree No. 27 was assumed as early as 1974, on the
first anniversary of the present constitution, in De Chavez v. Zobel
and specifically upheld in Gonzales v. Estrella five years later, there

cannot be any justification for holding that it is unconstitutional on
29
its face without any factual foundation.‰
Further, in Association of Small Landowners in the 30

Philippines, Inc. v. Secretary of Agrarian Reform,31
involving32 the constitutionality
33
of P.D. 27, E.O. Nos. 228
and 229, and R.A. 6657, any other assault on the validity
of P.D. 27 was ultimately foreclosed when it was declared
therein that „R.A. No. 6657, P.D. No. 27, Proc. No. 131, and
E.O. Nos. 228 and 229 are SUSTAINED against all34 the
constitutional objections raised in the herein petition.‰
_______________
26 91 SCRA 294 [1979].

27 Ibid., p. 295.
28 113 SCRA 798 [1982].
29 Ibid., p. 801.
30 175 SCRA 343 [1989].
31 Issued on July 17, 1987, entitled „Declaring Full Land Ownership to
Qualified Farmer Beneficiaries Covered by Presidential Decree No. 27;
Determining the Value of Remaining Unvalued Rice and Corn Lands
Subject of P.D. 27; and Providing for the Manner of Payment by the
Farmer Beneficiary and Mode of Compensation to the Landowner.‰
32 Issued on July 22, 1987, entitled „Providing the Mechanisms for the
Implementation of the Comprehensive Agrarian Reform Program.‰
33 Signed into law on June 10, 1988, entitled „An Act Instituting a
Comprehensive Agrarian Reform Program to Promote Social Justice and
Industrialization; Providing the Mechanism for its Implementation, and
For Other Purposes.‰
34 Supra, note no. 19, p. 393.
28

The objection that P.D. 27 is unconstitutional as it sets

limitations on the judicial prerogative of determining just
compensation is bereft of merit. P.D. 27 provides:
„For the purpose of determining the cost of the land to be

transferred to the tenant-farmer pursuant to this Decree, the value
of the land shall be equivalent to two and one half (2 1/2) times the
average harvest of three normal crop years immediately preceding
the promulgation of this Decree‰;
E.O. 228 supplemented such provision, viz.:
„SEC. 2. Henceforth, the valuation of rice and corn lands covered by

P.D. 27 shall be based on the average gross production determined
by the Barangay Committee on Land Production in accordance with
Department Memorandum Circular No. 26, series of 1973 and
related issuances and regulation of the Department of Agrarian
Reform. The average gross production per hectare shall be
multiplied by two and a half (2.5), the product of which shall be
multiplied by Thirty Five Pesos (P35.00), the government support
price for one cavan of 50 kilos of palay on October 21, 1972, or
Thirty One Pesos (P31.00), the government support price for one
cavan of 50 kilos of corn on October 21, 1972, and the amount
arrived at shall be the value of the rice and corn land, as the case
may be, for the purpose of determining its cost to the farmer and
compensation to the landowner.‰
The determination of just compensation under P.D. No. 27,

like in Section 16 (d)
35
of R.A. 6657 or the CARP Law, is not
final or conclusive. This is evident from the succeeding
paragraph of Section 2 of E.O. 228:
„x x x In the event of dispute with the landowner regarding the

amount of lease rental paid by the farmer beneficiary, the
Department of Agrarian Reform and the Barangay Committee on
Land Production concerned shall resolve the dispute within thirty
(30) days from its submission pursuant to Department of Agrarian
Reform Memorandum Circular No. 26, series of 1973, and other
pertinent issuances. In the event a party questions in court the
resolution of the dispute, the landownerÊs compensation shall still
be processed for payment and the proceeds shall be held in trust by
the Trust Department of the Land Bank in accordance with the
_______________
35 Vinzons case, note 18, p. 541; Association of Small Landowners in the

Philippines, Inc. case, note 30, p. 382.
29
VOL. 387, AUGUST 8, 2002 29

provisions of Section 5 hereof, pending the resolution of the dispute

before the court.‰
Clearly therefrom, unless both the landowner and the

tenant-farmer accept the valuation of the property by the
Barrio Committee on Land Production and the DAR, the
parties may bring the dispute to court in order to
determine the appropriate amount of compensation, a task
unmistakably within the prerogative of the court.
Finally, the Court need not belabor the fact that R.A.
6657 or the CARP Law operates distinctly from P.D. 27.
R.A. 6657 covers all public and private agricultural land
including other lands of the public domain suitable for
agriculture as provided for36
in Proclamation No. 131 and
Executive Order No. 229; while, P.D. 27 covers rice and
corn lands. On this score, E.O. 229, which provides for the
mechanism of the Comprehensive Agrarian Reform
Program, specifically states: „(P)residential Decree No. 27,
as amended, shall continue to operate with 37respect to rice
and corn lands, covered thereunder. x x x‰ It cannot be
gainsaid, therefore, that R.A. 6657 did not repeal or
supersede, in any way, P.D. 27. And whatever provisions of
P.D. 27 that are not inconsistent
38
with R.A. 6657 shall be
suppletory to the latter, and all rights acquired by the
tenant-farmer under39P.D. 27 are retained even with the
passage of R.A. 6657.
WHEREFORE, the consolidated petitions filed by
Rolando Sigre and the Land Bank of the Philippines are
hereby GRANTED. The assailed Decision of the Court of
Appeals is hereby NULLIFIED and SET ASIDE and the
petition in CA-G.R. SP No. 28906 is DISMISSED for lack of
merit.
SO ORDERED.
Davide, Jr. (C.J., Chairman) and Vitug, J., concur.
_______________
36 Section 2 of R.A. 6657.

37 Section 27 of E.O. 229.
38 Section 75 of R.A. 6657.
39 Association of Small Landowners in the Philippines, Inc. case, note
30, p. 391.
30

Ynson vs. Court of Appeals
Kapunan and Ynares-Santiago, JJ., No part.
Petition granted, judgment annulled and set aside.
Notes.·The exercise of the rights of ownership are

subject to limitations that may be imposed by law, such as
the Tenancy Act and P.D. 27. (Philippine National Bank vs.
Court of Appeals, 275 SCRA 70 [1997])
The policy of the courts as regards the factual findings of
administrative bodies is not to interfere with actions of the
executive branch on administrative matters addressed to
the sound discretion of government agencies, a policy
especially applicable in the grant of licenses, permits, and
leases, or the approval, rejection, or revocation of
applications therefor. (Sañado vs. Court of Appeals, 356
SCRA 546 [2001])
Parcels of land, though obtained by homestead patents
under Commonwealth Act 141, are covered by land reform
under P.D. 27. (Paris vs. Alfeche, 364 SCRA 110 [2001])
··o0o··
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SUPREME COURT REPORTS ANNOTATED VOLUME 387 24/06/2019, 1*17 PM

VOL. 387, AUGUST 8, 2002 15

ROLANDO SIGRE, petitioner, vs. COURT OF APPEALS

LAND BANK OF THE PHILIPPINES, petitioner, vs.

Agrarian Reform; Statutes; Presidential Decree No. 27;

16 SUPREME COURT REPORTS ANNOTATED