LAND TITLE & DEEDS

AEJAY V. BARIAS
PCU-COLLEGE OF LAW
CHAPTER IX
CERTIFICATE OF LAND TRANSFER, EMANCIPATION PATENT ,
AFFIDAVIT OF NON-TENANCY
THE COMPREHENSIVE AGRARIAN REFORM PROGRAM (CARP),

The Supreme Court, through the exhaustive ponencia of Justice Cruz in the landmark case of
Association of Small Landowners in the Philippines v. Secretary of Agrarian Reform,1 gives a
profound background of the agrarian reform program aimed at emancipating the tenant from
the bondage of the soil, thus ––
“Land for the Landless” is a slogan that underscores the acute imbalance in the distribution of
this precious resource among our people. But it is more than a slogan. Through the brooding
centuries, it has become a battlecry dramatizing the increasingly urgent demand of the
dispossessed among us for a plot of earth as their place in the sun.
Recognizing this need, the Constitution in 1935 mandated the policy of social justice to
“insure the well-being and economic security of all the people,” especially the less privileged.
In 1973, the new Constitution affirmed this goal, adding specifically that “the State shall
regulate the acquisition, ownership, use, enjoyment and disposition of private property and
equitably diffuse property ownership and profits.” Significantly, there was also the specific
injunction to “formulate and implement an agrarian reform program aimed at emancipating
the tenant from the bondage of the soil.”
AGRARIAN REFORM PROVISIONS
Constitutional provisions
Section 12, Article XIV of the 1973 Constitution provides:
“SEC. 12. The State shall formulate and implement an agrarian reform program aimed
at emancipating the tenant from the bondage of the soil and achieving the goals
enunciated in this Constitution.
Such program may include the grant or distribution of alienable and disposable lands
of the public domain to qualified tenants, farmers and other landless citizens in areas
which the President may by or pursuant to law reserve from time to time, not
exceeding the limitations fixed in accordance with the immediately preceding section.
The State shall moreover undertake an urban land reform and social housing program
to provide deserving landless, homeless or inadequately sheltered low income resident
citizens reasonable opportunity to acquire land and decent housing consistent with
Section 2 of Article IV of this Constitution.”
On the other hand, Section 4, Article XIII of the 1987 Constitution
provides:
“SEC. 4. The State shall, by law, undertake an agrarian reform
program founded on the right of farmers and regular farmworkers,
who are landless, to own directly or collectively the lands they till or,
in the case of other farmworkers, to receive a just share of the fruits
thereof. To this end, the State shall encourage and undertake the just
distribution of all agricultural lands, subject to such priorities and
reasonable retention limits as the Congress may prescribe, taking into
account ecological, developmental, or equity considerations, and
subject to the payment of just compensation. In determining retention
limits, the State shall respect the right of small land-owners. The State
shall further provide incentives for voluntary land-sharing.”
PD No. 27, or the “Tenant Emancipation Decree”

This shall apply to tenant farmers of private agricultural lands primarily devoted to
rice and corn under a system of sharecrop or lease-tenancy, whether classified as
landed estate or not;

The tenant farmer, whether in land classified as landed estate or not, shall be
deemed owner of a portion constituting a family-size farm of five (5) hectares if not
irrigated and three (3) hectares if irrigated;

In all cases, the landowner may retain an area of not more than seven (7) hectares
if such landowner is cultivating such area or will now cultivate it;

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;

The total cost of the land, including interest at the rate of six (6) per centum per
In case of default, the amortizations due shall be paid by the farmers’ cooperative
in which the defaulting tenant farmer is a member, with the cooperative having a
right of recourse against him;

The government shall guaranty such amortizations with shares of stock in government-
owned and government-controlled corporations;

No title to the land owned by the tenant-farmers under this Decree shall be actually issued
to a tenant farmer unless and until the tenant-farmer has become a full-fledged member of
a duly recognized farmer’s cooperative;

Title to land acquired pursuant to this Decree or the Land Reform Program of the
Government shall not be transferable except by hereditary succession or to the Government
in accordance with the provisions of this Decree, the Code of Agrarian Reforms and other
existing laws and regulations;

The Department of Agrarian Reform through its Secretary is hereby empowered to

promulgate rules and regulations for the implementation of this Decree.

All laws, executive orders, decrees and rules and regulations, or parts thereof, inconsistent
RA No. 6657, or the “Comprehensive Agrarian Reform Law
of 1988”

The agrarian reform program is founded on the right of farmers and regular
farmworkers, who are landless, to own directly or collectively the lands they till
or, in the case of other farm workers, to receive a just share of the fruits thereof.
To this end, the State shall encourage and undertake the just distribution of all
agricultural lands, subject to the priorities and retention limits set forth in the law,
taking into account ecological, developmental, and equity considerations, and
subject to the payment of just compensation.

The State shall respect the right of small landowners, and shall provide incentives
for voluntary land-sharing. Corollary, a more equitable distribution and ownership
of land, with due regard to the rights of landowners to just compensation and to
the ecological needs of the nation, shall be undertaken to provide farmers and
farmworkers with the opportunity to enhance their dignity and improve the
quality of their lives through greater productivity of agricultural lands.
PD NO. 27 LAID DOWN A SYSTEM FOR THE PURCHASE BY
SMALL FARMERS OF THE LANDS THEY WERE TILLING
PD No. 27 was anchored upon the fundamental objective of addressing valid and
legitimate grievances of land ownership giving rise to violent conflict and social
tension in the countryside. More importantly, it recognized the necessity to
encourage a more productive agricultural base of the country’s economy. To achieve
this end, the decree laid down a system for the purchase by small farmers, long
recognized as the backbone of the economy, of the lands they were tilling.
Landowners of agricultural lands which were devoted primarily to rice and corn
production and exceeded the minimum retention area were thus compelled to sell,
through the intercession of the government, their lands to qualified farmers at
liberal terms and conditions. However, a careful study of the provisions of PD No. 27,
and the certificate of land transfer issued to qualified farmers, will reveal that the
transfer of ownership over these lands is subject to particular terms and conditions
the compliance with which is necessary in order that the grantees can claim the
right of absolute ownership over them.
PD NO. 27 DECLARED CONSTITUTIONAL

One of the most far-reaching governmental reforms, acclaimed both here and abroad, is PD
No. 27 issued on October 21, 1972, decreeing the emancipation of the tenants from the
bondage of the soil and transferring the ownership of the land they till. Its validity was
assumed in Chavez v. Zobel,2 and upheld in Gonzales v. Estrella.
Under a Letter of Instruction (LOI) dated October 21, 1976, the President directed the then
Secretary of Agrarian Reform, to “undertake to place under the Land Transfer Program of the
government pursuant to PD No. 27, all tenanted rice/corn lands with areas of seven hectares
or less belonging to landowners who own other agricultural lands of more than seven
hectares in aggregate areas or lands used for residential, commercial, industrial or other
urban purposes from which they derive adequate income to support themselves and their
families.”
The constitutionality of RA No. 6657 was upheld in the case of Association of Small
CONSTITUTIONALITY OFv.RA
Landowners in the Philippines, Inc. NO. 6657
Secrertary UPHELD
of Agrarian Reform.6 The Supreme Court,
through Justice Cruz, held that the requirement of public use has been settled by the
Constitution itself. It noted that “(n)o less than the 1987 Charter calls for agrarian reform
which is the reason why private agricultural lands are to be taken from their owners, subject
to the prescribed maximum retention limits.” The Court also declared that the law is a valid
exercise by the State of the police power and the power of eminent domain. On the alleged
violation of the equal protection clause, the sugar planters have failed to show that they
belong to a different class and should be differently treated. And on the alleged payment of
public money as just compensation without the corresponding appropriation, the Court said
that there is no rule that only money already in existence can be the subject of an
appropriation law. The earmarking of fifty billion pesos as Agrarian Reform Fund, although
denominated as an initial amount, is actually the maximum sum appropriated. The word
“initial” simply means that additional amounts may be appropriated later when necessary.
Finally, on the contention that the law is unconstitutional insofar as it requires the owners of
the expropriated properties to accept just compensation therefor in less than money, which is
the only medium of payment allowed, the Court held that the law “is not an ordinary
expropriation where only a specific property of relatively limited area is sought to be taken by
the State from its owner for a specific and perhaps local purpose,” but deals with “a
revolutionary kind of expropriation (which) affects all private agricultural lands.” “(S)uch a
SCOPE OF THE COMPREHENSIVE AGRARIAN REFORM
PROGRAM (CARP)
The Constitution in Section 4, Article XIII mandates the just distribution of all agricultural
lands, subject to such priorities and reasonable retention limits which Congress may
prescribe, taking into account ecological, developmental or equity considerations and subject
to the payment of just compensation.
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.
Prior to RA No. 6657, the operative law on land distribution was PD No. 27. However, PD No.
27 is limited in scope, covering only tenanted private agricultural lands primarily devoted to
rice and corn operating under a system of share-tenancy or lease tenancy, whether classified
as landed estate or not. The constitutional provision expanded the scope of agrarian reform to
cover all agricultural lands. RA No. 6657 operationalized this constitutional mandate by
providing that the CARP shall cover, regardless of tenurial arrangement and commodity
produced, all public and private agricultural lands, as provided in Proclamation No. 131 and
Specifically, the following lands are covered by CARP:

(a)All alienable lands of the public domain devoted to or suitable

for agriculture;
(b)All lands of the public domain in excess of the specific limits as
determined by Congress;
(c)All other lands owned by the government devoted to or
suitable for agriculture; and
(d) All private lands devoted to or suitable for agriculture
regardless of the agricultural products raised or that can be
raised thereon.
EXEMPTIONS AND EXCLUSIONS

Section 10 of RA No. 6657, as amended by RA No. 7881, dated February 20, 1995, exempts or excludes the
following from CARP coverage:
(a) Lands actually, directly and exclusively used for parks, wildlife, forest reserves, reforestation, fish sanctuaries
and breeding grounds, watersheds and mangroves;
(b) Private lands actually, directly and exclusively used for prawn farms and fishponds; Provided, That said prawn
farms and fishponds have not been distributed and Certificate of Land Ownership Award (CLOA) issued to
agrarian reform beneficiaries under the CARP, and subject further to the conditions prescribed in the law;
(c) Lands actually, directly and exclusively used and found to be necessary for:
— national defense, school sites and campuses, including experimental farm stations operated by public or
private schools for educational purposes, seeds and seedling research and pilot production center;
— church sites and convents appurtenant thereto, mosque sites and Islamic centers appurtenant thereto,
communal burial grounds and cemeteries;
— penal colonies and penal farms actually worked by the inmates;
— government and private research and quarantine centers; and
— all lands with eighteen percent (18%) slope and over, except those already developed.
ONLY AGRICULTURAL LANDS ARE SUBJECT TO AGRARIAN
REFORM COVERAGE
The agrarian reform program, be it under the aegis of PD
No. 27 or RA No. 6657, covers only agricultural lands. PD No.
27, by its terms, applies to tenant-farmers of private
agricultural lands primarily devoted to rice and corn under a
system of share-cropping or lease-tenancy. On the other
hand, RA No. 6657 covers all public and private agricultural
lands, regardless of tenurial arrangement and commodity
produced. Lands classified as mineral, or any area where
mineral resources, or concentration of minerals/rocks with
potential economic value are found, are outside of
Operation Land Transfer (OLT) coverage.
MEANING OF “AGRICULTURAL LAND,” “AGRICULTURAL
ACTIVITY”
Section 3(c) of RA No. 6657 defines agricultural land as “land devoted to agricultural
activity as defined in this Act and not classified as mineral, forest, residential,
commercial or industrial land.” On the other hand, Section 3(b) defines agricultural
activity as “the cultivation of the soil, planting of crops, growing of fruit trees, raising
of livestock, poultry or fish, including the harvesting of such farm products, and
other farm activities and practices performed by a farmer in conjunction with such
farming operations done by person whether natural or juridical.”
In Natalia Realty, Inc. v. Depatment of Agrarian Reform,9 the Supreme Court,
through Justice Bellosillo, held: “Section 4 of R.A. 6657 provides that the CARL
(Comprehensive Agrarian Reform Law) 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,
LANDS CONVERTED TO NON-AGRICULTURAL USES PRIOR TO
THE EFFECTIVITY OF CARL ARE OUTSIDE ITS COVERAGE

The Court in Natalia further held that 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 the
Department of Agrarian Reform (DAR). Thus, for instance, the
conversion of portions of the Antipolo Hills Subdivision for
residential use and developed as such prior to the passage of the
law excluded the area for CARL coverage because it ceased to be
devoted to agricultural activity.
FARMS USED FOR RAISING LIVESTOCK, POULTRY AND SWINE
NOT COVERED
RA No. 6657 originally included in its coverage farms used for raising livestock,
poultry and swine. However, on December 4, 1990, in an en banc decision in the
case of Luz Farms v. Secretary of the Department of Agrarian Reform,10 the Court
ruled that lands devoted to livestock and poultry-raising are not included in the
definition of agricultural land. Hence, it declared as unconstitutional certain
provisions of the CARL insofar as they included livestock farms in the coverage of
agrarian reform. On December 27, 1993, the Department of Agrarian Reform (DAR)
issued AO No. 9, series of 1993, which provided that only portions of private
agricultural lands used for the raising of livestock, poultry and swine as of June 15,
1988 shall be excluded from the coverage of the CARL. But in determining the area
of land to be excluded, AO No. 9 fixed the following retention limits, viz.: 1:1 animal-
land ratio (i.e., 1 hectare of land per 1 head of animal shall be retained by the
landowner), and a ratio of 1.7815 hectares for livestock infrastructure for every 21
heads of cattle shall likewise be excluded from the operations of the CARL.
AGRICULTURAL LANDS RECLASSIFIED BY LGU’S INTO
RESIDENTIAL, COMMERCIAL OR INDUSTRIAL USES
EXCLUDED

If the agricultural land was classified as residential, commercial or industrial by the local
government units (LGU’s) and approved by the Housing and Land Use Regulatory Board
(HLURB), or its predecessor agencies, prior to June 15, 1988, the land will be recognized as so
classified under Section 3(c) of RA No. 6657 and is, therefore, not covered by CARP. However,
an exemption clearance from the DAR is still necessary to confirm or declare its exempt status.
This is based on DOJ Opinion No. 44 (1990) which provides that with respect to the conversion
of agricultural lands covered by RA No. 6657 to non-agricultural uses, the authority of the DAR
to approve such conversion may be exercised from the date of its effectivity or on June 15,
1988. Thus, all lands already classified as commercial, industrial or residential before that date
no longer need any conversion clearance from the DAR.
If an agricultural land is reclassified after June 15, 1988, the provisions on land conversion
under CARL and its implementing rules will apply
LANDS USED FOR ACADEMIC OR EDUCATIONAL PURPOSES
EXEMPTED
In Central Mindanao University v. Department of Agrarian Reform Adjudication
Board,14 the Court, through Justice Campos, held that the 400-hectare land owned
by the Central Mindanao University for school site and campus, including
experimental farm stations for educational purposes, is exempt from CARP coverage
because —
(1) It is not alienable and disposable land of the public domain;
(2) The CMU land reservation is not in excess of specific limits as determined by
Congress;
(3) It is private land registered and titled in the name of its lawful owner, the CMU;
(4) It is exempt from coverage under Section 10 of R.A. 6657 because the lands are
actually, directly and exclusively used and found to be necessary for school site
and campus, including experimental farm stations for educational purposes, and
for establishing seed and seedling research and pilot production centers.
HOMESTEADS ARE EXCLUDED

In Alita v. Court of Appeals,15 the Court, through Justice Paras, held that a homestead
acquired under the provisions of the Public Land Act is exempt from CARP coverage. The
Court said that while PD No. 27 decreeing the emancipation of tenants from the bondage
of the soil and transferring to them ownership of the land they till is a sweeping social
legislation, it cannot defeat the very purpose of the Public Land Act which has been
enacted for the welfare and protection of the poor. The law gives a needy citizen a piece
of land where he may build a modest house for himself and family and plant what is
necessary for subsistence and for the satisfaction of life’s other needs. “The right of the
citizens to their homes and to the things necessary for their subsistence is as vital as the
right to life itself. They have a right to live with a certain degree of comfort as become
human beings, and the State which looks after the welfare of the people’s happiness is
under a duty to safeguard the satisfaction of this vital right.”
JURISDICTION OF THE DAR

Matters involving the administrative implementation of the transfer of the land, such as the giving out of notices of
coverage to the tenant-farmer under PD No. 27 and amendatory and related decrees, rules and regulations, shall be
exclusively cognizable by the Secretary of Agrarian Reform, including the issuance, recall or cancellation of Emancipation
Patents (EPs) or Certificate of Land Ownership Award (CLOA), save when such certificates of land transfer have been
registered with the Register of Deeds, in which instance the recalling authority is the DAR Adjudicating Board (DARAB).
A petition asking for the exclusion of petitioner’s landholding from the coverage of the Comprehensive Agrarian Reform
Program (CARP) involves the implementation of agrarian reform, a matter over which the DAR has original and exclusive
jurisdiction, pursuant to Section 50 of the Comprehensive Agrarian Reform Law (CARL).19 The failure of petitioners to pay
back rentals pursuant to the leasehold contract with private respondent is an issue which is clearly beyond the legal
competence of the trial court to resolve. The doctrine of primary jurisdiction does not warrant a court to arrogate unto itself
the authority to resolve a controversy the jurisdiction over which is initially lodged with an administrative body of special
competence.
Likewise, all controversies on the implementation of the CARP fall under the jurisdiction of the Department of Agrarian
Reform (DAR), even though they raise questions that are also legal or constitutional in nature. All doubts should be resolved
in favor of the DAR, since the law has granted it special and original authority to hear and adjudicate agrarian matters.
CARS ABOLISHED; JURISDICTION NOW VESTED IN RTCS

Ever since agrarian reform legislations began, litigants have invariably sought the aid of the courts. Courts of Agrarian
Relations (CARs) were organized under RA No. 1267 “[f]or the enforcement of all laws and regulations governing the
relation of capital and labor on all agricultural lands under any system of cultivation.” All the powers and prerogatives
inherent in or belonging to the then Courts of First Instance (CFIs), now Regional Trial Courts (RTCs), were granted to
the CARs. PD No. 946 thereafter reorganized the CARs, streamlined their operations, and expanded their jurisdiction.
The CARs were abolished, however, pursuant to Section 44 of BP Blg. 129, approved August 14, 1981, which was fully
implemented on February 14, 1983. Jurisdiction over cases theretofore given to the CAR’s was vested in the RTCs. Then
came EO No. 229. Under Section 17 thereof, the DAR shall exercise “quasi-judicial powers to determine and adjudicate
agrarian reform matters, and shall have exclusive jurisdiction over all matters involving implementation of agrarian
reform, except those falling under the exclusive original jurisdiction of the DENR and the Department of Agriculture
[DA].” The DAR shall also have the “powers to punish for contempt and to issue subpoena, subpoena duces tecum and
writs to enforce its orders or decisions.”
In Quismundo v. Court of Appeals, the provision was deemed to have repealed Section 12(a) and (b) of PD No. 946
which vested the then CARs with “original exclusive jurisdiction over cases and questions involving rights granted and
obligations imposed by presidential issuances promulgated in relation to the agrarian reform program.”
CARS ABOLISHED; JURISDICTION NOW VESTED IN RTCS
Nonetheless, the RTCs have not been completely divested of jurisdiction over
agrarian reform matters. Section 56 of RA No. 6657 confers special jurisdiction on
“Special Agrarian Courts,” which are actually RTCs designated as such by the
Supreme Court. Under Section 57 of the same law, these Special Agrarian Courts
have original and exclusive jurisdiction over the following matters:
(1) all petitions for the determination of just compensation to land-owners, and
(2) (2) the prosecution of all criminal offenses under the Act.

The above delineation of jurisdiction remains in place to this date. Administrative

Circular No. 29-2002 of the Supreme Court stresses the distinction between the
quasi-judicial powers of the DAR under Sections 50 and 55 of RA No. 6657 and the
jurisdiction of the Special Agrarian Courts referred to by Sections 56 and 57 of the
same law.
 RETENTION LIMITS

“SEC. 6. 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-sized farm, 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. Three (3) hectares may be awarded to each child of the landowner, subject
to the following qualifications: (1) that he is at least fifteen (15) years of age; and (2) that he
is actually tilling the land or directly managing the farm; Provided, That landowners whose
lands have been covered by Presidential Decree No. 27 shall be allowed to keep the area
originally retained by them thereunder, further, That original homestead grantees or direct
compulsory heirs who still own the original homestead at the time of the approval of this Act
shall retain the same areas as long as they continue to cultivate said homestead.
RIGHTS OF RETENTION UNDER PD NO. 27 ARE RETAINED
EVEN NOW UNDER RA NO. 6657
It is worth stressing that all rights acquired by the
tenantfarmer under PD No. 27, as recognized under EO No.
228, are retained by him even now under RA No. 6657. This
should counterbalance the express provision in Section 6 of
the said law that “the landowners whose lands have been
covered by PD No. 27 shall be allowed to keep the area
originally retained by them thereunder, further, that original
homestead grantees or direct compulsory heirs who still
own the original homestead at the time of the approval of
this Act shall retain the same areas as long as they continue
to cultivate said homestead
 WAIVER OF RIGHT OF RETENTION
Under Section 7 of DAR AO No. 5, the following acts constitute waiver of the landowner’s right of
retention:
(a) Executing an affidavit or any other document duly attested by the MARO, Provincial Agrarian Reform
Officer (PARO) or Regional Director (RD) indicating that he is expressly waiving his retention right over
subject landholding;
(b) Signing of the Landowner-Tenant Production Agreement and Farmer’s Undertaking (LTPA-FU) or
Application for Purchase and Farmer’s Undertaking (APFU) covering subject property;
(c) Entering into a Voluntary Land Transfer/Direct Payment Scheme (VLT-DPS) agreement as evidenced by
a Deed of Transfer over the subject property;
(d) Offering the subject landholding under VOS scheme and failure to indicate his retained area;
(e) Signing/submission of other documents indicating consent to have the entire property covered, such
as the form letter of the LBP on the disposition of the case and bond portions of a land transfer claim
for payment, and the Deed of Assignment, warranties and undertaking executed in favor the LBP;
(f) Performing acts which constitute estoppel by laches;
(g) Doing such act or acts as would amount to a valid waiver in accordance with applicable laws and
jurisprudence
POLICY FOR ANCESTRAL LANDS UNDER CARP
CARP ensures the protection of the right of ICCs/IPs to their ancestral
lands to ensure their economic, social and cultural well being.
Systems of land ownership, land use, and modes of settling land
disputes of the ICCs/IPs shall be recognized and respected in line with
the principles of self-determination and autonomy. The Presidential
Agrarian Reform Committee (PARC), notwithstanding any law to the
contrary, has the power to suspend the implementation of the CARP
with respect to ancestral lands for the purpose of identifying and
delineating such lands. It shall respect laws on ancestral domain
enacted by the respective legislators of autonomous regions subject
to the provisions of the Constitution and the principles enumerated in
RA No. 6657 and other national laws.
AGRICULTURAL TENANCY

Agricultural tenancy is defined as “the physical possession by a person of land devoted

to agriculture, belonging to, or legally possessed by, another for the purpose of
production through the labor of the former and of the members of his immediate farm
household, in consideration of which the former agrees to share the harvest with the
latter, or to pay a price certain or ascertainable, either in produce or in money, or both.”
Courts determine the existence (or nonexistence) of a tenancy relationship on the basis
of the evidence presented by the parties. Certifications of administrative agencies and
officers declaring the existence of a tenancy relation are merely provisional. They are
persuasive but not binding on courts, which must make their own findings.
In Gelos v. Court of Appeals, it was held that “tenancy is not a purely factual relationship
dependent on what the alleged tenant does upon the land. It is also a legal relationship.
The intent of the parties, the understanding when the farmer is installed, and their
written agreements, provided these are complied with and are not contrary to law, are
even more important.”
ONLY LEASEHOLD TENANCY IS RECOGNIZED

A tenant is defined under Section 5(a) of RA No. 1199 as 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 system.
Agricultural tenancy is classified into share tenancy and leasehold tenancy. But under
RA No. 6657, the only agricultural tenancy relation that is recognized is leasehold
tenancy. Said law expressly repealed Section 35 of RA No. 3844, making all tenanted
agricultural lands throughout the country subject to leasehold.
The area of agricultural land that a lessee may cultivate has no limit, but he should
cultivate the entire area leased. The 3-hectare limit under RA No. 6657 applies only to
the award that may be given to the agrarian reform beneficiary.
FINDING BY DAR OF TENANCY RELATIONSHIP IS MERELY
PRELIMINARY
It is well-settled that the findings of or certifications issued by the
Secretary of Agrarian Reform, or his authorized representative, in a
given locality concerning the presence or absence of a tenancy
relationship between the contending parties is merely preliminary or
provisional and is not binding upon the courts.
One cannot be said to be an agricultural lessee if he has not
personally or by his farm household cultivated the land in question.
The mere fact that the land is agricultural does not ipso facto make
him an agricultural lessee. The law provides conditions or requisites
before he can qualify as one and the land being agricultural is only
one of them. Among others, the law is explicit in requiring the tenant
and his immediate family to work the land.
EXTINGUISHMENT OF AGRICULTURAL LEASEHOLD RELATION
Once a leasehold relation has been established, the agricultural lessee
is entitled to security of tenure and has a right to continue working on
the land except when he is ejected therefrom for cause as provided by
law.
The agricultural leasehold relation shall be extinguished by:
(1)Abandonment of the landholding without the knowledge of the
agricultural lessor;
(2)Voluntary surrender of the landholding by the agricultural lessee,
written notice of which shall be served three months in advance; or
(3)Absence of the persons under section nine to succeed to the lessee,
in the event of death or permanent incapacity of the lessee.
MODES OF ACQUISITION.

The modes by which private agricultural lands may be acquired

are:
(a) Operation Land Transfer (OLT)
(b) Voluntary Offer to Sell (VOS)
(c) Voluntary Land Transfer/Direct Payment Scheme (VLT/ DPS)
(d) Compulsory Acquisition (CA)
(e) Voluntary Stock Distribution (VSD) in the case of corporate farms.
OPERATION LAND TRANSFER
Operation Land Transfer (OLT) is a mechanism established for the implementation of PD No.
27. It is a mode by which ownership of tenanted rice and corn lands is transferred to tenant
beneficiaries. But for the lands to come under OLT, there must first be a showing that they are
tenanted lands.
As earlier stated, Pres. Marcos issued LOI No. 227 (1974) to extend the operations
implementing the land reform program to landholdings of over seven (7) hectares. Then, on
October 21, 1976, he issued LOI No. 474 placing under the Land Transfer Program of the
government pursuant to PD No. 27 all tenanted rice/corn lands with areas of seven hectares
or less belonging to landowners who own other agricultural lands of more than seven
hectares in aggregate areas or lands used for residential, commercial, industrial or other
urban purposes from which they derive adequate income to support themselves and their
families. Landowners who may choose to be paid the cost of their lands by the Land Bank of
the Philippines shall be paid in accordance with the mode of payment provided in LOI No. 273
dated May 7, 1973.
VOLUNTARY OFFER TO SELL
Voluntary Offer to Sell (VOS) is a scheme whereby the landowners
voluntarily offer their agricultural lands for coverage regardless of
phasing. It does not, however, mean that their landholdings
voluntarily offered for sale are automatically accepted by the DAR. A
VOS may be rejected if the landholding is not suitable for agriculture,
or has a slope of more than eighteen percent (18%) and is
undeveloped. Likewise, said offer may be refused if there are no
takers or persons willing to be agrarian reform beneficiaries and,
lastly, the only identified ARBs are the qualified children of the
landowner. As a general rule, withdrawal of VOS shall no longer be
allowed after the receipt by the DAR of the offer.
Landowners, other than banks and other financial institutions, who
voluntarily offer their lands for sale shall be entitled to an additional
five percent (5%) cash payment.
VOLUNTARY LAND TRANSFER/DIRECT PAYMENT SCHEME

Voluntary Land Transfer or Direct Payment Scheme

(VLT/DPS) is a mode of acquisition whereby the landowner
and the beneficiary enter into a voluntary arrangement for
the direct transfer of the lands to the latter. Not all private
agricultural lands may be the subject of voluntary transfer.
For instance, lands mortgaged with banking and/ or financial
institutions cannot be the subject of VLT/DPS.
 COMPULSORY ACQUISITION
Compulsory acquisition is a mode whereby the land is expropriated by the State in accordance with the procedure outlined in Section 16 of
RA No. 6657.
For purposes of acquisition of private lands, the following procedure shall be followed:
(a) After having identified the land, the landowners and the beneficiaries, the DAR shall send its notice to acquire the land to the owners
thereof, by personal delivery or registered mail, and post the same in a conspicuous place in the municipal building and barangay hall of
the place where the property is located. Said notice shall contain the offer of the DAR to pay a corresponding value in accordance with the
valuation set forth in Sections 17, 18, and other pertinent provisions hereof.
(b) Within thirty (30) days from the date of receipt of written notice by personal delivery or registered mail, the landowner, his administrator
or representative shall inform the DAR of his acceptance or rejection of the offer.
(c) If the landowner accepts the offer of the DAR, the Land Bank of the Philippines (LBP) shall pay the landowner the purchase price of the
land within thirty (30) days after he executes and delivers a deed of transfer in favor of the government and surrenders the certificate of
title and other muniments of title.
(d) In case of rejection or failure to reply, the DAR shall conduct summary administrative proceedings to determine the compensation for the
land requiring the landowner, the LBP and other interested parties to submit evidence as to the just compensation for the land, within
fifteen (15) days from the receipt of the notice. After the expiration of the above period, the matter is deemed submitted for decision. The
DAR shall decide the case within thirty (30) days after it is submitted for decision.
(e) Upon receipt by the landowner of the corresponding payment or, in case of rejection or no response from the landowner, upon the deposit
with an accessible bank designated by the DAR of the compensation in cash or in LBP bonds in accordance with this Act, the DAR shall
take immediate possession of the land and shall request the proper Register of Deeds to issue a Transfer Certificate of Title (TCT) in the
name of the Republic of the Philippines. The DAR shall thereafter proceed with the redistribution of the land to the qualified beneficiaries.
(f) Any party who disagrees with the decision may bring the matter to the court of proper jurisdiction for final determination of just
compensation.
JUST COMPENSATION

In Association of Small Landowners in the Philippines v. Secretary

of Agrarian Reform,73 the Court explained the meaning of just
compensation as “the full and fair equivalent of the property taken
from its owner by the expropriator.” It has been repeatedly stressed
that the measure is not the taker’s gain but the owner’s loss. The
word “just” is used to intensify the meaning of the word
“compensation” to convey the idea that the equivalent to be rendered
for the property to be taken shall be real, substantial, full, ample.
DETERMINATION OF JUST COMPENSATION

Section 6 of RA No. 6657 provides that the following shall be

considered as additional factors in determining just compensation:
(a) cost of acquisition of the land; (b) current value of the like
properties; (c) nature, actual use and income of the land; (d) sworn
valuation by the owner; (e) tax declarations and the assessment
made by government assessors; (f) social and economic benefits
contributed by the farmers and the farmworkers and by the
government to the property; and (g) non-payment of taxes or loans
secured from any government financing institution on the said land.
 DETERMINATION OF JUST COMPENSATION A JUDICIAL
FUNCTION

The Court said that the “determination made by the

DAR is only preliminary unless accepted by all
parties concerned. Otherwise, the courts of justice
will still have the right to review with finality the said
determination in the exercise of what is admittedly a
judicial function.”
SUMMARY

With the decisions of the Supreme Court upholding the constitutionality of RA No.
6657, PD No. 27, Proclamation No. 131, and EO Nos. 228 and 229, the following
rules evolve:
1. Title to all expropriated properties shall be transferred to the State only upon
full payment of compensation to their respective owners.
2. All rights previously acquired by the tenant-farmers under PD No. 27 are
retained and recognized.
3. Landowners who were unable to exercise their rights of retention under PD No.
27 shall enjoy the retention rights granted by RA No. 6657 under the conditions
therein prescribed.