Natalia Realty, Inc. vs. Department of Agrarian Reform 225 SCRA 278 (1993)

Natalia Realty, Inc. vs. Department of Agrarian Reform 

225 SCRA 278 (1993)

Facts:

Petitioner Natalia Realty, Inc. is the owner of a 125.0078-ha land set aside by Presidential Proclamation No. 1637 (1979) as townsite area for the Lungsod Silangan Reservation. Estate Developers and Investors Corporation (EDIC), the developer of the area, was granted preliminary approval and locational clearances by the then Human Settlements Regulatory Commission (HSRC) for the establishment of the Antipolo Hills Subdivision therein. In November 1990, a Notice of Coverage was issued by DAR on the undeveloped portion of the landholding. The developer filed its objections and filed this case imputing grave abuse of discretion to respondent DAR for including the undeveloped portions of its landholding within the coverage of CARP.

Issue:

Are lands already classified for residential, commercial or industrial use, and approved by HLURB and its precursor agencies prior to 15 June 1988, covered by RA 6657?

Held:

Sec. 4 of RA 6657 states that the CARL covers "regardless of tenurial arrangement and commodity produced, all public and private and agricultural lands" and as per the transcripts of the Constitutional Commission, "agricultural lands" covered by agrarian reform refers only to those which are "arable and suitable lands" and "do not include commercial, industrial and residential lands." The land subject of the controversy has been set aside for the Lungsod Silangan Reservation by Proclamation No. 1637 prior to the effectivity of RA 6657 and in effect converted these lands into residential use. Since the Natalia lands were converted prior to 15 June 1988, DAR is bound by such conversion, and thus it was an error to include these within the coverage of CARL.

Scope of CARP

Scope of CARP

     The Constitution in Sec. 4, Art. XIII, mandates the just distribution of all agricultural lands, subject to such priorities and reasonable retention limits that the Congress may prescribe, taking into account ecological, developmental or equity considerations and subject to the payment of just compensation.

     Prior to RA 6657, the operative law on land distribution was PD 27 (1972). However, PD 27 is limited in scope, covering only tenanted private agricultural lands primarily devoted to rice and corn operating under a system of share-crop or lease tenancy, whether classified as landed estate or not. The constitutional provision therefore expanded the scope of agrarian reform to cover all agricultural lands.

     RA 6657 operationalized this constitutional mandate and provides in Sec. 4 thereof 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 EO 229including other lands of the public domain suitable for agriculture. More specifically, the following lands are covered by CARP:

a)         All alienable and disposable 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 in Sec. 4 (a) of RA 6657;

c)         All other lands owned by the government devoted to or suitable for agriculture; and

d)         All private lands devoted or suitable for agriculture regardless of the agricultural products raised or that can be raised thereon (Rep. Act No. 6657 [1988], Sec. 4).

Comprehensive Agrarian Reform Program

The Comprehensive Agrarian Reform Program

     The Comprehensive Agrarian Reform Program (CARP) is implemented by Republic Act No. 6657 (1988) otherwise known as the "Comprehensive Agrarian Reform Law". Prior to its enactment on 10 June 1988, President Corazon C. Aquino issued Proclamation No. 131 (1987) instituting a comprehensive agrarian reform program, and Executive Order No. 229 (1987) providing the mechanics for its implementation. RA 6657 took effect on 15 June 1988.

While expressly repealing specific provisions of prior enactments on agrarian reform, RA 6657 provides that the provisions of RA 3844(1963), Presidential Decree No. 27 (1972) and PD 266 (1973), EO 228 (1987) and EO 229 (1987) and other laws not inconsistent with it shall have suppletory effect.

     RA 6657 was enacted pursuant to the constitutional mandate enshrined in Section 4, Art. XIII of the 1987 Constitution, which 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 landowners. The State shall further provide incentives for voluntary land-sharing.

     The constitutionality of RA 6657 has been upheld in Association of Small Landowners v. Secretary of Agrarian Reform, 175 SCRA 342 (1989) and companion cases. The Supreme Court held that the requirement of public use has already 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 retention limits." (at 378)

     While RA 6657 itself has been held constitutional, the Supreme Court in a subsequent case, Luz Farms v. Secretary of Agrarian Reform, 192 SCRA 51 (1990), declared unconstitutional Sec. 3 (b), 10 and 11 thereof in so far as they include lands devoted to the raising of livestock, swine and poultry within its coverage. As a result of this ruling, Congress enacted RA 7881 (1995) amending these provisions and incorporating new provisions to existing ones. The amendments adopted the Luz doctrine by removing livestock, swine and poultry farms from CARP coverage.