Natalia Realty, Inc.

and Estate Developer and Investors Corp vs DAR

GR No 103302                                                                                     August 12, 1993

Facts:
Natalia is the owner of 3 contiguous parcels of land with an area of 120.9793 hectares,
1.3205 hectares and 2.7080 hectares or a total of 125.0078 hectares, which are covered by
TCT No. 31527. Presidential Proclamation No. 1637 set aside 20,312 hectares of land 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. Since private landowners were allowed to develop their
properties into low-cost housing subdivisions with the reservation, petitioner EDIC as
developer of Natalia applied for and was granted preliminary approval and location
clearances by the Human Settlements Regulatory Commission, which Natalia thereafter
became Antipolo Hills Subdivision. On June 15 1988, Ra 6657 went to effect. Respondent
issed a Notice of Coverage on the undeveloped portions of Antipolo Hills Subdivision.
Natalia and EDIC immediately registered its objection to the notice of coverage and
requested the cancellation of the Notice of Coverage.

Natalia and EDIC both argued that the properties ceased to be agricultural lands when they
were included in the areas reserved by Presidential Proclamation for the townsite
reservation. DAR then contended that the permits granted were not valid and binding since
they did not comply with t he implementing Standards, Rules and Regulations of PD 957
(The Subdivision and Condominium Buyers Protective Decree), and that there was no valid
conversion of the properties.

Issue:
Whether or not lands not classified for agricultural use, as approved by the Housing and
Land Use Regulatory Board and its agencies prior to June 15, 1988 covered by RA 6657.

Ruling:
No, Sec. 4 of RA 6657 provides that CARL shall cover, regardless of tenurial arrangement
and commodity produced, all public and private agricultural lands. And agricultural lands is
referred to as land devoted to agricultural activity and not classified as mineral, forst,
residential, commercial or industrial land. Thus, the underdeveloped portions of the Antipolo
Hills Subdivision cannot be considered as agricultural lands for this land was intended for
residential use. They ceased to be agricultural land by virtue of the Presidential
Proclamation No. 1637.

NATALIA REALTY, INC., AND ESTATE DEVELOPERS AND INVESTORS CORP. vs

DEPARTMENT OF AGRARIAN REFORM

G.R. No. 103302 August 12, 1993

Facts:

Petitioner Natalia Realty, Inc. is the owner of three (3) 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.

Since private landowners were allowed to develop their properties into low-cost housing subdivisions
within the reservation, petitioner 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, which
consisted of 13.2371 hectares, was issued sometime in 1982; for Phase II, with an area of 80,000
hectares, on 13 October 1983; and for Phase III, which consisted of the remaining 31.7707 hectares, 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.

Issue:

Whether or not DAR incurred grave abuse of discretion for including undeveloped portions of the
Antipolo Hills Subdivision within the coverage of the CARL.

Held:
Yes. 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.

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.

Supreme Court rule for petitioners and hold that public respondents gravely abused their discretion in
issuing the assailed Notice of Coverage of 22 November 1990 by of lands over which they no longer have
jurisdiction.

WHEREFORE, the petition for Certiorari is GRANTED. The Notice of Coverage of 22 November 1990 by
virtue of which undeveloped portions of the Antipolo Hills Subdivision were placed under CARL coverage
is hereby SET ASIDE.