Heirs of Dr. Jose Deleste v. Land Bank of the Philippines et. al.

Facts:
1. Spouses Gregorio Nanaman and Hilaria Tabuclin owned a parcel of land consisting of 34.7
hectares. The Spouses were childless, but Gregorio had a son named Virgilio (Gregorio’s son
with another woman) who had been raised by the couple since he was 2 years old.
2. When Gregorio died in 1945, Hilaria and Virgilio administered the subject property. On
February 16, 1954 the property was sold to Dr. Jose Deleste.
3. On May 15, 1954, Hilaria died. Edilberto Noel, who was the appointed administrator of the
estate, filed a reversion of the property on April 30, 1963. It was ruled by the Supreme Court
that the property is conjugal and that Hilaria could only sell a half of the estate. As a result,
the intestate estate of Gregorio and Deleste became co-owner of the property.
4. While such case was pending, PD 27 was issued, mandating tenanted rice and corn land be
brought under the Operation Land Transfer (OLT) Program to be awarded to farmer
beneficiaries. Thus, the subject property was placed under such program.
5. In 1975, the City of Illigan passed City Ordinance No. 1313 (Zoning Regulation of Illigan City)
reclassifying the property as commercial/residential.
6. February 12, 1984 Department of Agrarian Reform (DAR) issued Certificate of Land Transfer
(CLT) in favor of private respondents who were tenants and actual cultivators of the subject
property. The CLTs were registered on July 15, 1986.
7. In 1991, the land was surveyed, a total of 20.2611 hectares was designated as Lot No. 1407,
approved on January 8, 1999. Thereafter, Emancipation Patents (EPs) and Original
Certificate of Title (OCT) were issued on August 1, 2001 and October 1, 2001 in favor of
private respondents.
8. Heirs of Deleste (Petitioners) filed with the Department of Agrarian Reform Adjudication
Board (DARAB) a petition seeking to nullify the respondents’ EPs. The Provincial Agrarian
Reform Adjudicator (PARAD) rendered the EPs null and void due to subsequent
reclassification of the property and violation of petitioners’ right to due process.
9. Private respondents appealed. DARAB reversed the ruling of PARAD, it held that the EPs are
valid stating that there are is evidence that the City Ordinance was approved by the Housing
and Land Regulatory Board (HLURB) as mandated by DAR Admin. No. 1.
10. Petitioners appealed to the Court of Appeals but was denied for failure to attach writ of
execution, order nullifying the writ of execution, and material portion of the record referred
to in the petition and the other supporting papers as required under Section 6 of Rule 43 of
the Rules of Court. Petitioners appealed to the Supreme Court after the Motion for
Reconsideration was denied by the Court of Appeals.

Issue/s:
1. Whether or not Petitioners’ land is covered by Agrarian Reform given that the City of Illigan
passed a City Ordinance reclassifying the area into residential area in 1975.
2. Whether or not the issuance of the Emancipation Patents and Original Certificate of Titles
were legal.

Ruling:
1. Subject property Lot No. 1407 is outside the coverage of Agrarian Reform Program in view
of the enactment of the City Ordinance No. 1313. Local Government Units have the power
of reclassifying agricultural lands, and is not subject to approval of DAR. DARAB however,
believes that the approval of HLURB is necessary for the reclassification to be valid.
However, the City Ordinance was enacted in 1975 to which HLURB did not exist during those
times. It was only in 1978 that zoning ordinances were required to be submitted to the
Ministry of Human Settlements. The Human Settlements Regulatory Commission
(predecessor of HLURB) was the regulatory arm of the Ministry of the Human Settlements.
It was found that the ordinance was indeed approved under the Human Settlements
Regulatory Commission and is therefore valid.
2. The respondents alleged however, that the property was covered by PD 27 since October
21, 1972. They alleged that the reclassification cannot be applied to defeat vested rights of
tenant-farmers under PD 27. The Court ruled that this applies only after certain
requirements are complied with, which is after being full-fledged members in the farmer’s
cooperative, full payment of just compensation and the full payment of the amortizations
due them. But since the CLTs were only issued in 1984, the respondents only have inchoate
right over the property during that time. in actuality, even during those times no rights are
vested to the tenant-farmers considering that the reclassification was enacted prior to the
issuance of the CLTs. The Original Certificate of Title and Emancipation Patents issued are
likewise invalid since they were only issued in 2001, which is 26 years after the enactment of
the reclassification.