G.R. No. 78214 December 5, 1988

YOLANDA CABALLES, petitioner, vs. DEPARTMENT OF AGRARIAN REFORM, HON. HEHERSON T. ALVAREZ and BIENVENIDO ABAJON,respondents.

SARMIENTO, J.:

Before us is a petition for certiorari seeking the annulment of an Order issued by the public respondent Ministry of Agrarian Reform , now the Department of Agrarian Reform (DAR), through its then Minister, the Hon. Heherson Alvarez, finding the existence of a tenancy relationship between the herein petitioner and the private respondent and certifying the criminal case for malicious mischief filed by the petitioner against the private respondent as not proper for trial.

The facts as gathered by the MAR are as follows:

The landholding subject of the controversy, which consists of only sixty (60) square meters (20 meters x 3 meters) was acquired by the spouses Arturo and Yolanda Caballes, the latter being the petitioner herein, by virtue of a Deed of Absolute Sale dated July 24, 1978 executed by Andrea Alicaba Millenes This landholding is part of Lot No. 3109-C, which has a total area of about 500 square meters, situated at Lawaan Talisay, Cebu. The remainder of Lot No. 3109-C was subseconsequently sold to the said spouses by Macario Alicaba and the other members of the Millenes family, thus consolidating ownership over the entire (500-square meter) property in favor of the petitioner.

In 1975, before the sale in favor of the Caballes spouses, private respondent Bienvenido Abajon constructed his house on a portion of the said landholding, paying a monthly rental of P2.00 to the owner, Andrea Millenes. The landowner likewise allowed Abajon to plant on a portion of the land, agreeing that the produce thereof would be shared by both on a fitfy-fifty basis. From 1975-1977, Abajon planted corn and bananas on the landholding. In 1978, he stopped planting corn but continued to plant

bananas and camote. During those four years, he paid the P2.00 rental for the lot occupied by his house, and delivered 50% of the produce to Andrea Millenes.

Sometime in March 1979, after the property was sold, the new owners, Arturo and Yolanda Caballes, told Abajon that the poultry they intended to build would be close to his house and pursuaded him to transfer his dwelling to the opposite or southern portion of the landholding. Abajon offered to pay the new owners rental on the land occupied by his house, but his offer was not accepted. Later, the new owners asked Abajon to vacate the premises, saying that they needed the property. But Abajon refused to leave. The parties had a confrontation before the Barangay Captain of Lawaan in Talisay, Cebu but failed to reach an agreement. All the efforts exerted by the landowners to oust Abajon from the landholding were in vain as the latter simply refused to budge.

On April 1, 1982, the landowner, Yolanda Caballes, executed an Affidavit stating that immediately after she reprimanded Abajon for harvesting bananas and jackfruit from the property without her knowledge, the latter, with malicious and ill intent, cut down the banana plants on the property worth about P50.00. A criminal case for malicious mischief was filed against Abajon and which was docketed as Criminal Case No. 4003. Obviously, all the planting on the property, including that of the banana plants, had been done by Abajon. On September 30, 1982, upon motion of the defense in open court pursuant to PD 1038, the trial court ordered the referral of the case to the Regional Office No. VII of the then MAR for a preliminary determination of the relationship between the parties. As a result, the Regional Director of MAR Regional VII, issued a certification 1 dated January 24, 1 983, stating that said Criminal Case No. 4003 was not proper for hearing on the bases of the following findings:

That herein accused is a bona-fide tenant of the land owned by the complaining witness, which is devoted to bananas;

That thin case is filed patently to harass and/or eject the tenant from his farmholding, which act is prohibited by law; and

That this arose out of or is connected with agrarian relations.

From the said certification, the petitioner appealed to the then MAR, now the respondent DAR. Acting on said appeal, the respondent DAR, through its then Minister Conrado Estrella, reversed the previous certification in its Order 2 of February 3, 1986, declaring Criminal Case No. 4003 as proper for trial as "the land involved is a residential lot consisting of only 60 square meters whereon the house of the accused is constructed and within the industrial zone of the town as evinced from the Certification issued by the Zoning Administrator of Talisay, Cebu."

Upon motion for reconsideration filed by Abajon, the respondent DAR, through its new Minister, herein respondent Heherson Alvarez, issued an Orders dated November 15, 1986, setting aside the previous Order 3 dated February 3, 1986, and certifying said criminal case as not proper for trial, finding the existence of a tenancy relationship between the parties, and that the case was designed to harass the accused into vacating his tillage.

In the summary investigation conducted by the DAR, the former landowner, Andrea Millenes, testified that Bienvenido Abajon dutifully gave her 50% share of the produce of the land under his cultivation. The grandson of Andrea Millenes, Roger Millenes, corroborated the testimony of the former, stating that he received said share from Abajon. Roger Millenes further testified that the present owners received in his presence a bunch of bananas from the accused representing or 50% of the two bunches of bananas gathered after Caballes had acquired the property. 4

From these factual findings, the DAR concluded that Abajon was a tenant of Andrea Millenes, the former owner, who had testified that she shared the produce of the land with Abajon as truer thereof. 5 Thus, invoking Sec. 10 of RA 3844, as amended, which provides that "[T]he agricultural leasehold relation under this Code shall not be extinguished by mere expiration of the term or period in a leasehold contract nor by the sale, alienation or transfer of the legal possession of the landholding"; and that "(I)n case the agricultural lessor sells, alienates or transfers the legal possession of the landholding, the purchaser or transferee thereof shall be subrogated to the rights and substituted to the obligations of the agricultural lessor," the MAR ruled that 'the new owners are legally bound to respect the tenancy, notwithstanding their claim that the portion tilled by Abajon was small,

consisting merely of three (3) meters wide and twenty (20) meters long, or a total of sixty (60) square meters." 6

Hence, this petition for certiorari alleging that:

I. Respondents DAR and Hon. Heherson T. Alvarez committed "grave abuse of power and discretion amounting to lack of jurisdiction" in holding that private respondent Abajon is an agricultural tenant even if he is cultivating only a 60-square meter (3 x 20 meters) portion of a commercial lot of the petitioner.

II. Public respondents gravely erred in holding that Criminal Case No. 4003 is not proper for trial and hearing by the court. 7

We hold that the private respondent cannot avail of the benefits afforded by RA 3844, as amended. To invest him with the status of a tenant is preposterous.

Section 2 of said law provides:

It is the policy of the State:

(1) To establish cooperative-cultivatorship among those who live and work on the land as tillers, owner-cultivatorship and the economic family-size farm as the basis of Philippine agriculture and, as a consequence, divert landlord capital in agriculture to industrial development;

xxx xxx xxx

RA 3844, as amended, defines an economic family-size farm as "an area of farm land that permits efficient use of labor and capital resources of the farm family and will produce an income sufficient to provide a modest standard of living to meet a farm family's needs for food, clothing, shelter, and education with possible allowance for payment of yearly installments on the land, and reasonable reserves to absorb yearly fluctuations in income." 8

The private respondent only occupied a miniscule portion (60 square meters) of the 500-square meter lot. Sixty square meters of land planted to bananas, camote, and corn cannot by any stretch of the imagination be considered as an economic family-size farm. Surely, planting camote, bananas, and corn on a sixty-square meter piece of land can not produce an income sufficient to provide a modest standard of living to meet the farm family's basic needs. The private respondent himself admitted that he did not depend on the products of the land because it was too small, and that he took on carpentry jobs on the side. 9 Thus, the order sought to be reviewed is patently contrary to the declared policy of the law stated above.

The DAR found that the private respondent shared the produce of the land with the former owner, Andrea Millenes. This led or misled, the public respondents to conclude that a tenancy relationship existed between the petitioner and the private respondent because, the public respondents continue, by operation of Sec. 10 of R.A. 3844, as amended, the petitioner new owner is subrogated to the rights and substituted to the obligations of the supposed agricultural lessor (the former owner).

We disagree.

The essential requisites of a tenancy relationship are:

1. The parties are the landowner and the tenant; 2. The subject is agricultural land; 3. There is consent; 4. The purpose is agricultural production; 5. There is personal cultivation; and 6. There is sharing of harvests.

All these requisites must concur in order to create a tenancy relationship between the parties. The absence of one does not make an occupant of a parcel of land, or a cultivator thereof, or a planter thereon, a de jure tenant. This is so because unless a person has established his status as a de jure tenant, he is not entitled to security of tenure nor is he covered by the Land Reform Program of the Government under existing tenancy laws. 10

Therefore, the fact of sharing alone is not sufficient to establish a tenancy relationship. Certainly, it is not unusual for a landowner to accept some of

the produce of his land from someone who plants certain crops thereon. This is a typical and laudable provinciano trait of sharing or patikim, a native way of expressing gratitude for favor received. This, however, does not automatically make the tiller-sharer a tenant thereof specially when the area tilled is only 60, or even 500, square meters and located in an urban area and in. the heart of an industrial or commercial zone at that. Tenancy status arises only if an occupant of a parcel of land has been given its possession for the primary purpose of agricultural production. The circumstances of this case indicate that the private respondent's status is more of a caretaker who was allowed by the owner out of benevolence or compassion to live in the premises and to have a garden of some sort at its southwestern side rather than a tenant of the said portion.

Agricultural production as the primary purpose being absent in the arrangement, it is clear that the private respondent was never a tenant of the former owner, Andrea Millenes. Consequently, Sec. 10 of RA of 3844, as amended, does not apply. Simply stated, the private respondent is not a tenant of the herein petitioner.

Anent the second assignment of error, the petitioner argues that since Abajon, is not an agricultural tenant, the criminal case for malicious mischief filed against him should be declared as proper for trial so that proceedings in the lower court can resume.

Notwithstanding our ruling that the private respondent is not a tenant of the petitioner, we hold that the remand of the case to the lower court for the resumption of the criminal proceedings is not in the interest of justice. Remand to the Municipal Court of Talisay, Cebu, would not serve the ends of justice at all, nor is it necessary, because this High Tribunal is in a position to resolve with finality the dispute before it. This Court, in the public interest, and towards the expeditious administration of justice, has decided to act on the merits and dispose of the case with finality. 11

The criminal case for malicious mischief filed by the petitioner against the private respondent for allegedly cutting down banana trees worth a measly P50.00 will take up much of the time and attention of the municipal court to the prejudice of other more pressing cases pending therein. Furthermore, the private respondent will have to incur unnecessary expenses to finance his legal battle against the petitioner if proceedings in the court below were to resume. Court litigants have decried the long and unnecessary delay in

the resolution of their cases and the consequent costs of such litigations. The poor, particularly, are victims of this unjust judicial dawdle, Impoverished that they are they must deal with unjust legal procrastination which they can only interpret as harassment or intimidation brought about by their poverty, deprivation, and despair. It must be the mission of the Court to remove the misperceptions aggrieved people have of the nature of the dispensation of justice. If justice can be meted out now, why wait for it to drop gently from heaven? Thus, considering that this case involves a mere bagatelle the Court finds it proper and compelling to decide it here and now, instead of further deferring its final termination.

As found by the DAR, the case for malicious mischief stemmed from the petitioner's affidavit stating that after she reprimanded private respondent Abajon for harvesting bananas and jackfruit from the property without her knowledge, the latter, with ill intent, cut the banana trees on the property worth about P50.00.

This was corroborated by a certain Anita Duaban, a friend of the petitioner, who likewise executed an affidavit to the effect that she saw the private respondent indiscriminately cutting the banana trees. 12

The Revised Penal Code, as amended, provides that "any person who shall deliberately cause to the property of another any damage not falling within the terms of the next preceding chapter shall be guilty of malicious mischief."13

The elements of the crime of malicious mischief are:

1. The offender deliberately caused damage to the property of another; 2. The damage caused did not constitute arson or crimes involving destruction; 3. The damage was caused maliciously by the offender.

After a review of the facts and circumstances of this case, we rule that the aforesaid criminal case against the private respondent be dismissed.

The private respondent can not be held criminally liable for malicious mischief in cutting the banana trees because, as an authorized occupant or

possessor of the land, and as planter of the banana trees, he owns said crops including the fruits thereof The private respondent's possession of the land is not illegal or in bad faith because he was snowed by the previous owners to enter and occupy the premises. In other words, the private respondent worked the land in dispute with the consent of the previous and present owners. Consequently, whatever the private respondent planted and cultivated on that piece of property belonged to him and not to the landowner. Thus, an essential element of the crime of malicious mischief, which is "damage deliberately caused to the property of another," is absent because the private respondent merely cut down his own plantings.

WHEREFORE, the Order of public respondents dated November 15, 1986 is SET ASIDE and Criminal Case No. 4003, is hereby DISMISSED. Let a copy of this decision be sent to the Municipal Trial Court of Talisay, Cebu for appropriate action. This Decision is IMMEDIATELY EXECUTORY.

No costs.

SO ORDERED.

Melencio-Herrera (Chairperson), Paras, Padilla and Regalado, JJ., concur.

G.R. No. 86186 May 8, 1992

RAFAEL GELOS, petitioner, vs. THE HONORABLE COURT OF APPEALS and ERNESTO ALZONA, respondents.

Balagtas P. Ilagan for petitioner.

Emil Capulong, Jr., for private respondent.

CRUZ, J.:

The Court is asked to determine the real status of the petitioner, who claims to be a tenant of the private respondent and entitled to the benefits of tenancy laws. The private respondent objects, contending that the petitioner is only a hired laborer whose right to occupy the subject land ended with the termination of their contract of employment.

The subject land is a 25,000 square meter farmland situated in Cabuyao, Laguna, and belonging originally to private respondent Ernesto Alzona and his parents in equal shares. On July 5, 1970, they entered into a written contract with petitioner Rafael Gelos employing him as their laborer on the land at the stipulated daily wage of P5.00. 1 On September 4, 1973, after Alzona had bought his parents' share and acquired full ownership of the land, he wrote Gelos to inform him of the termination of his services and to demand that he vacate the property. Gelos refused and continued working on the land.

On October 1, 1973, Gelos went to the Court of Agrarian Relations and asked for the fixing of the agricultural lease rental on the property. He later withdrew the case and went to the Ministry of Agrarian Reform, which granted his petition. For his part, Alzona filed a complaint for illegal detainer against Gelos in the Municipal Court of Cabuyao, but this action was declared "not proper for trial" by the Ministry of Agrarian Reform because of the existence of a tenancy relationship between the parties. Alzona was

rebuffed for the same reason when he sought the assistance of the Ministry of Labor and later when he filed a complaint with the Court of Agrarian Relations for a declaration of non-tenancy and damages against Gelos. On appeal to the Office of the President, however, the complaint was declared proper for trial and so de-archived and reinstated.

After hearing, the Regional Trial Court of San Pablo City (which had taken over the Court of Agrarian Relations under PB 129) rendered a decision dated April 21, 1987, dismissing the complaint. 2 It found Gelos to be a tenant of the subject property and entitled to remain thereon as such. The plaintiff was also held liable in attorney's fees and costs.

The decision was subsequently reversed by the Court of Appeals. In its judgment promulgated on November 25, 1988, 3 it held that Gelos was not a tenant of the land in question and ordered him to surrender it to Alzona. He was also held liable for the payment of P10,000.00 as attorney's fees and the costs of the suit.

The basic question the petitioner now raises before the Court is essentially factual and therefore not proper in a petition for review under Rule 45 of the Rules of Court. Only questions of law may be raised in this kind of proceeding. The settled rule is that the factual findings of the Court of Appeals are conclusive on even this Court as long as they are supported by substantial evidence. The petitioner has not shown that his case comes under any of those rare exceptions on such findings may be validly reversed by this Court.

It is true that in Talavera v. Court of Appeals, 4 we held that a factual conclusion made by the trial court that a person is a tenant farmer, if it is supported by the minimum evidence demanded by law, is final and conclusive and cannot be reversed by the appellate tribunals except for compelling reasons. In the case at bar, however, we find with the respondent court that there was such a compelling reason. A careful examination of the record reveals that, indeed, the trial court misappreciated the facts when it ruled that the petitioner was a tenant of the private respondent.

The circumstance that the findings of the respondent court do not concur with those of the trial court does not, of course, call for automatic reversal of the appellate court. Precisely, the function of the appellate court is to review

and, if warranted, reverse the findings of the trial court. Disagreement between the two courts merely calls on us to make a specially careful study of their respective decisions to determine which of them should be preferred as more conformable to the facts at hand.

The Court has made this careful study and will sustain the decision of the respondent court.

The contract of employment dated July 5, 1970, written in Tagalog and entitled "Kasunduan ng Upahang Araw," reads pertinently as follows:

1. Ang Unang Panig ay siyang may-ari at nagtatangkilik ng isang lagay na lupa, sinasaka, na tumatayo sa Nayon ng Baclaran, Cabuyao, Laguna, na siyang gagawa at sasaka sa lupa, samantalang ang Ikalawang Panig ay magiging upahan at katulong sa paggawa ng lupa.

2. Ang Unang Panig ay gustong ipagpatuloy ang pagbubungkal at paggawa ng bukid na binabanggit sa itaas at ang Ikalawang Panig ay may ibig na magpaupa sa paggawa sa halagang P5.00 sa bawat araw, walong oras na trabaho gaya ng mga sumusunod: Patubigan ng linang; pagpapahalabas ng mga pilapil; pagpapaaldabis sa unang araw ng pag-aararo; pagpapalinis ng damo sa ibabaw ng pilapil; pagpapakamot (unang pagpapasuyod), pagpapahalang at pagpapabalasaw (ikalawa't ikatlong pagpapasuyod); isang tao sa pagsasabog ng abono una sa pagpapantay ng linang; bago magtanim; isang tao sa pagaalaga ng dapog; upa sa isang tao ng magbobomba ng gamot laban sa pagkapit ng mga kulisap (mayroon at wala); sa nag-we-weeder; upa sa mga tao na maggagamas at magpapatubig ng palay; magsasapaw ng mga pilapil at iba pa.

3. Ang Unang Panig at ang Ikalawang Panig ay nagkasundo na ang huli ay gagawa sa bukid ayon sa nabanggit sa itaas bilang katulong at upahan lamang. Ang Unang Panig bukod sa sila ang gagawa at magsasaka ay maaaring umupa ng iba pang tao manggagawa sa

upahang umiiral sang-ayon sa batas katulad ng pag-aararo, pagpapahulip, pagpapagamas, pagbobomba, pagweweeder, pagsasabog ng abono, pagbobomba ng gamot, pagpapatubig at iba pang mga gawain. Maaaring alisin ang Ikalawang Panig sa pagpapatrabaho sa ano mang oras ng Unang Panig.

4. Ipinatatanto ng Ikalawang Panig na siya ay hindi kasama sa bukid kundi upahan lamang na binabayaran sa bawa't araw ng kanyang paggawa sa bukid na nabanggit.

It is noted that the agreement provides that "ang Ikalawang Panig (meaning Gelos) ay may ibig na magpaupa sa paggawa sa halagang P5.00 sa bawa't araw, walong oras na trabaho" (The Second Party desires to lease his services at the rate of P5.00 per day, eight hours of work) and that "Ipinatatanto ng Ikalawang Panig na siya ay hindi kasama sa bukid kundi upahan lamang na binabayaran sa bawa't araw ng kanyang paggawa sa bukid na nabanggit.'' (The Second Party makes it known that he is not a farm tenant but only a hired laborer who is paid for every day of work on the said farm.)

These stipulations clearly indicate that the parties did not enter into a tenancy agreement but only a contract of employment. The agreement is a lease of services, not of the land in dispute. This intention is quite consistent with the undisputed fact that three days before that agreement was concluded, the former tenant of the land, Leocadio Punongbayan, had executed an instrument in which he voluntarily surrendered his tenancy rights to the private respondent. 5 It also clearly demonstrates that, contrary to the petitioner's contention, Alzona intended to cultivate the land himself instead of placing it again under tenancy.

The petitioner would now disavow the agreement, but his protestations are less than convincing. His wife's testimony that he is illiterate is belied by his own testimony to the contrary in another proceeding. 6 Her claim that they were tricked into signing the agreement does not stand up against the testimony of Atty. Santos Pampolina, who declared under his oath as a witness (and as an attorney and officer of the court) that he explained the meaning of the document to Gelos, who even read it himself before signing it. 7 Atty. Pampolina said the agreement was not notarized because his commission as notary public was good only for Manila and did not cover

Laguna, where the document was executed. 8 At any rate, the lack of notarization did not adversely affect the veracity and effectiveness of the agreement, which, significantly, Gelos and his wife do not deny having signed.

Gelos points to the specific tasks mentioned in the agreement and suggests that they are the work of a tenant and not of a mere hired laborer. Not so. The work specified is not peculiar to tenancy. What a tenant may do may also be done by a hired laborer working under the direction of the landowner, as in the case at bar. It is not the nature of the work involved but the intention of the parties that determines the relationship between them.

As this Court has stressed in a number of cases, 9 "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 as in this case, their written agreements, provided these are complied with and are not contrary to law, are even more important."

Gelos presented receipts 10 for fertilizer and pesticides he allegedly bought and applied to the land of the private respondent, but the latter insists that it was his brother who bought them, being an agriculturist and in charge of the technical aspect of the farm. Moreover, the receipts do not indicate to which particular landholding the fertilizers would be applied and, as pointed out by the private respondent, could refer to the other parcels of land which Gelos was tenanting.

The petitioner's payment of irrigation fees from 1980 to 1985 to the National Irrigation Administration on the said landholding is explained by the fact that during the pendency of the CAR case, the Agrarian Reform Office fixed a provisional leasehold rental after a preliminary finding that Gelos was the tenant of the private respondent. As such, it was he who had to pay the irrigation fees. Incidentally, Section 12, subpar. (r) of PD 946 provides that the Secretary's determination of the tenancy relationship is only preliminary and cannot be conclusive on the lower court.

It is noteworthy that, except for the self-serving testimony of the petitioner's wife, the records of this case are bereft of evidence regarding the sharing of harvest between Gelos and Alzona. No less importantly, as the Court of

Appeals observed, the petitioner has not shown that he paid rentals on the subject property from 1970 to 1973, before their dispute arose.

A tenant is defined under Section 5(a) of Republic Act 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. (Emphasis supplied)

For this relationship to exist, it is necessary that: 1) the parties are the landowner and the tenant; 2) the subject is agricultural land; 3) there is consent; 4) the purpose is agricultural production; 5) there is personal cultivation; and 6) there is sharing of harvest or payment of rental. In the absence of any of these requisites, an occupant of a parcel of land, or a cultivator thereof, or planter thereon, cannot qualify as a de jure tenant. 11

On the other hand, the indications of an employer-employee relationship are: 1) the selection and engagement of the employee; 2) the payment of wages; 3) the power of dismissal; and 4) the power to control the employee's conduct although the latter is the most important element. 12

According to a well-known authority on the subject, 13 tenancy relationship is distinguished from farm employer-farm worker relationship in that: "In farm employer-farm worker relationship, the lease is one of labor with the agricultural laborer as the lessor of his services and the farm employer as the lessee thereof. In tenancy relationship, it is the landowner who is the lessor, and the tenant the lessee of agricultural land. The agricultural worker works for the farm employer and for his labor be receives a salary or wage regardless of whether the employer makes a profit. On the other hand, the tenant derives his income from the agricultural produce or harvest."

The private respondent, instead of receiving payment of rentals or sharing in the produce of the land, paid the petitioner lump sums for specific kinds of work on the subject lot or gave him vales, or advance payment of his wages as laborer thereon. The petitioner's wife claims that Alzona made her husband sign the invoices all at one time because he allegedly needed them to reduce his income taxes. Even assuming this to be true, we do not think

that made the said payments fictitious, especially so since the petitioner never denied having received them.

The other issue raised by the petitioner, which is decidedly legal, is easily resolved. There being no tenancy relationship, the contention that the private respondent's complaint has prescribed under Section 38 of R.A. 3844 must also fail. That section is not applicable. It must be noted that at the very outset, Alzona rejected the petitioner's claim of agricultural tenancy and immediately instituted his action for unlawful detainer in accordance with Section 1, Rule 70 of the Rules of Court. As it happened, the said case was held not proper for trial by the Ministry of Agrarian Reform. He then resorted to other remedies just so he could recover possession of his land and, finally, in 1979, he yielded to the jurisdiction of the defunct Court of Agrarian Relations by filing there an action for declaration of non-tenancy. The action, which was commenced in 1979, was within the ten-year prescriptive period provided under Article 1144 of the Civil Code for actions based on a written contract. *

The Court quotes with approval the following acute observations made by Justice Alicia Sempio-Diy:

It might not be amiss to state at this juncture that in deciding this case in favor of defendant, the lower court might have been greatly influenced by the fact that defendant is a mere farmer who is almost illiterate while plaintiff is an educated landlord, such that it had felt that it was its duty to be vigilant for the protection of defendant's interests. But the duty of the court to protect the weak and the underprivileged should not be carried out to such an extent as to deny justice to the landowner whenever truth and justice happen to be on his side. Besides, defendant's economic position vis a visthe plaintiff does not necessarily make him the underprivileged party in this case, for as testified by plaintiff which defendant never denied, the small land in question was the only landholding of plaintiff when he and his father bought the same, at which time he was just a lowly employee who did not even have a house of his own and his father, a mere farmer, while defendant was the agricultural tenant of another piece of land and also owns his own house, a sari

sari store, and a caritela. Plaintiff also surmised that it was only after defendant had been taken into its wings by the Federation of Free Farmers that he started claiming to be plaintiff's agricultural tenant, presumably upon the Federation's instigation and advice. And we cannot discount this possibility indeed, considering that during the early stages of the proceedings this case, defendant even counter-proposed to plaintiff that he would surrender the land in question to the latter if plaintiff would convey to him another piece of land adjacent to the land in question, almost one ha. in area, that plaintiff had also acquired after buying the land in question, showing that defendant was not as ignorant as he would want the Court to believe and had the advice of people knowledgeable on agrarian matters.

This Court has stressed more than once that social justice or any justice for that matter is for the deserving, whether he be a millionaire in his mansion or a pauper in his hovel. It is true that, in case of reasonable doubt, we are called upon to tilt the balance in favor of the poor, to whom the Constitution fittingly extends its sympathy and compassion. But never is it justified to prefer the poor simply because they are poor, or to reject the rich simply because they are rich, for justice must always be served, for poor and rich alike, according to the mandate of the law.

WHEREFORE, the challenged decision of the Court of Appeals is AFFIRMED and the petition is DENIED, with costs against the petitioner. It is so ordered.

Narvasa, C.J., Grio-Aquino, Medialdea and Bellosillo, JJ., concur.

G.R. No. L-27797 August 26, 1974

TRINIDAD GABRIEL, plaintiff-appellee, vs. EUSEBIO PANGILINAN, defendant-appellant.

Mariano Manahan, Jr. for plaintiff-appellee.

Virgilio M. Pablo for defendant-appellant.

Armando M. Laki for movant.

ZALDIVAR, J.:p

This appeal from the decision, dated December 26, 1963, of the Court of First Instance of Pampanga in its Civil Case No. 1823, was certified to this Court by the Court of Appeals for the reason that the jurisdiction of an inferior court is involved.

During the pendency of this case before this Court, under date of April 29, 1972, Atty. Virgilio M. Pablo, counsel for the appellant Eusebio Pangilinan, gave notice to this Court that said appellant died on April 3, 1964, and was survived by his children, who are his legal heirs, namely: Salvador Pangilinan, Santos Pangilinan, Mariano Pangilinan, Carlos Pangilinan and Pilar Pangilinan de Avante. For the purposes of this case the appellant Eusebio Pangilinan, therefore, is substituted by his heirs herein named.

Under date of November 20, 1973, Atty. Amando M. Laki filed a motion with this Court advising that appellee Trinidad Gabriel died on June 14, 1967, and was survived by her heirs and successors-in-interest, namely: Corazon O. Gabriel, married to Lamberto Ignacio; Ernesto O. Gabriel; Ester O. Gabriel, married to Emmanuel Padua; Generoso O. Gabriel, Marciano O. Gabriel and Pablo O. Gabriel, and prayed that appellee Trinidad Gabriel be substituted by her heirs herein named. By order of this Court of December 4, 1973 the prayer for substitution was granted.

In its resolution dated April 19, 1967 certifying the case to this Court, the Court of Appeals made the following findings, which We adopt:

On June 18, 1960 Trinidad Gabriel filed a complaint in the Court of First Instance of Pampanga against Eusebio Pangilinan alleging that she is the owner of a fishpond situated in barrio Sta. Ursula, Betis, Pampanga and measuring about 169,507 square meters; that sometime during the last war she entered into an oral contract of lease thereof with the defendant on a year to year basis, i.e., from January 1 to December 31, at a rental of P1,200, plus the amount of real estate taxes, payable in advance in the month of January; that desiring to develop and cultivate the fishpond by herself, she notified the defendant in a letter dated June 26, 1957 that she was terminating the contract as of December 31, 1957; that upon request of the defendant, she extended the lease for another year; that on November 19, 1958 she again wrote the defendant that he should surrender possession of the fishpond on January 1, 1959, which demand he however ignored. Plaintiff accordingly prayed that the defendant be ordered to restore the possession of the fishpond to her and to pay her P1,200, plus the amount of real estate taxes, a year from 1959, attorney's fees and costs.

The defendant moved for the dismissal of the complaint on the ground that the trial court had no jurisdiction over the case which properly pertains to the Court of Agrarian Relations, there being an agricultural leasehold tenancy relationship between the parties. Upon opposition by the plaintiff, the motion was denied. The defendant thereafter filed his answer with counterclaim alleging, inter alia, that the land in question was originally leased to him, also verbally, by the plaintiff's father, Potenciano Gabriel in 1923 for as long as the defendant wanted subject to the condition that he would convert the major portion into a fishpond and the part which was already a fishpond be improved at his expense which would be reimbursed by Potenciano Gabriel or his heirs at the termination of the lease for whatever cause; that when the plaintiff became the owner of the property through inheritance, she told the

defendant that she would honor her father's contract with the defendant, and likewise assured him that he could continue leasing the property, whose original rental of P400.00 a year had been progressively increased to P1,200.00, for as long as he wanted since she was not in a position to attend to it personally. As a special defense, the defendant reiterated the alleged lack of jurisdiction of the trial court to take cognizance of the case.

On February 12, 1962 the trial court issued an order herein below quoted in full:

The plaintiff sinks to eject the defendant from the fishpond described in the complaint which is under lease to the said defendant, who, however, refuses to vacate. Instead, he has impugned the jurisdiction of this Court contending that the action should have been filed with the Court of Agrarian Relations, which has original and exclusive jurisdiction, as their relationship is one of leasehold tenancy.

After the motion to dismiss was denied on the basis of the allegations of the complaint, the parties were ordered to adduce evidence for the purpose of determining which Court shall take cognizance of the case.

It appears that the fishpond is presently in the possession of the defendant, who originally leased it from the father of the plaintiff. Upon the death of the said father, the fishpond was inherited by the plaintiff. It is now covered by T.C.T. No. 1634 and is registered in her name. It contains an area of 169,507.00 square meters. The rental is on a yearly basis.

It also appears that the defendant has ceased to work personally with the aid of helpers the aforecited fishpond since 1956 he became ill and incapacitated. His daughter, Pilar Pangilinan, took over. She testified that she helps her father in administering the leased property, conveying his

instructions to the workers, Urbano Maninang, Isidro Bernal and Marciano Maninang. The names of Ire, Juan and Aguedo Viada have been mentioned as the laborers who were paid for the repair of the dikes. Bernardo Cayanan, a nephew of the defendant, acts as the watcher. He has lived separately since he got married. Excepting Pilar Pangilinan. who is residing near the fishpond, the other children of the defendant are all professions; a lawyer, an engineer, and a priest all residing in Manila. None of these persons has been seen working on the fishpond.

The above are the material and pertinent facts upon which we enter this order.

After a study of the facts and in the light of the provisions of the Tenancy Law, Republic Act No. 1199, particularly Sections 4 and 9, as amended. it seems clear that his case does not fall within the purview of said Act. The lease contract is manifestly a civil lease governed by the New Civil Code. Considering the area of the fishpond, 16 hectares, more or less, the fact that neither the defendant, who is physically incapacitated, or his daughter is Personally cultivating the fishpond or through the employment of mechanical farm implements, and the further fact that the persons named above are not members of the immediate farm household of the defendant, the conclusion is that no tenancy relationship exists between the plaintiff and the defendant as defined by Republic Act No. 1199, as amended.

We are, therefore, of the opinion and so hold that this Court is vested with jurisdiction to try and decide this case. After this order has become final, the plaintiff may request for the setting of the initial trial.

The defendant does not contest the findings of facts therein made by the trial court.

After the parties adduced their respective evidence on the merits, decision was rendered wherein the trial court Pursuant to Article 1197 of the Civil Code, fixed the period of the low up to June 30, 1964, the defendant on said date to surrender possession of the fishpond to the plaintiff and to pay the rentals due the latter. The plaintiff, on her part, was required upon surrender of on to her, to pay the defendant the sum of P1,000.00 as reimbursement of the expenses he incurred in improving the fishpond, and upon failure by either party to pay the amount due the other, the same would bear interest at the legal rate until full payment is made.

A reconsideration by the defendant having been denied, he appealed to this Court and assigned the following errors:

1. The lower court erred in considering the relationship of appellee and appellant as that of a civil lease, in accordance with the Civil Code of the Philippines and not a leasehold tenancy under Rep. Act No. 1199 as amended.

2. The lower court erred in not holding that the Court of First Instance is without jurisdiction, the cue being that of an agrarian relation in nature pursuant to Rep Act. NO. 1199 as amended.

3. The lower court erred in appreciating the evidence of the appellant particularly the basis for the expenditure for the development of the fishpond in question.

4. The lower court erred in rendering judgment in favor of the appellant in them easily amount of one thousand pesos for reimbursement and for seven hundred pesos for the cost of the floodgate.

Anent the question of jurisdiction, it is an admitted fact that plaintiff leased the fishpond to the defendant in 1943 without a fixed term, the annual rental

payable at the end of the year (Exhibit C, Deposition of plaintiff, Dec. 13, 1962, pp. 2 and 3). It is likewise undisputed that the work in the fishpond consisted in letting out the water so algae (lumut) would grow or if algae would not grow, getting some from the river and putting them in the fishpond, changing the dirty water with fresh water, repairing leaks in the dikes, and planting of fingerlings and attending to them; that these were done by defendant, with some help; that he personally attended to the fishpond until 1956 when he became ill; that thereafter his nephew Bernardo Cayanan, who was living with him, helped in the work to be done in the fishpond and his daughter Pilar Pangilinan helped in the management, conveying his instructions to the workers (t.s.n., pp. 4-8, Magat).

Upon the foregoing facts, the defendant insists that the relationship between the parties is an agricultural leasehold tenancy governed by Republic Act No. 1199, as amended, pursuant to section 35 of Republic Act No. 3844, and the present case is therefore within the original and exclusive jurisdiction of the Court of Agrarian Relations. Plaintiff, on the other hand, maintains in effect that since defendant has ceased to work the fishpond personally or with the aid of the members of his immediate farm household (Section 4, Republic Act No. 1199) the tenancy relationship between the parties has been extinguished (Section 9, id.) and become of civil lease and therefore the trial court properly assumed jurisdiction over the case.

It does appear that the controversy on the issue of jurisdiction calls for the interpretation of cultivating or working the land by the tenant personally or with the aid of the members of his immediate farm household. 1

Those are the findings and conclusions of facts made by the Court of Appeals which, as a general rule, bind this Court. 2

1. Let Us now discuss the issues raised in this appeal. First, was the relationship between the appellee and appellant a leasehold tenancy or a civil law lease?

There are important differences between a leasehold tenancy and a civil law lease. The subject matter of leasehold tenancy is limited to agricultural land; that of civil law lease may be either rural or urban property. As to attention and cultivation, the law requires the leasehold tenant to personally attend to, and cultivate the agricultural land, whereas the civil law lessee need not

personally cultivate or work the thing leased. As to purpose, the landholding in leasehold tenancy is devoted to agriculture, whereas in civil law lease, the purpose may be for any other lawful pursuits. As to the law that governs, the civil law lease is governed by the Civil Code, whereas leasehold tenancy is governed by special laws. 3

In order that leasehold tenancy under the Agricultural Tenancy Act may exist, the following requisites must concur.

1. That the land worked by the tenant is an agricultural land;

2. That the land is susceptible of cultivation by a single person together with members of his immediate farm household;

3. That the land must be cultivated by the tenant either personally or with the aid of labor available from members of his immediate farm household;

4. That the land belongs to another; and

5. That the use of the land by the tenant is for a consideration of a fixed amount in money or in produce or in both. 4

Were the foregoing requisites present in the instant case?

There is no doubt that the land in question is agricultural land. It is a fishpond and the Agricultural Tenancy Act, which refers to "agricultural land", specifically mentions fishponds and prescribes the consideration for the use thereof. Thus Section 46(c) of said Act provides that "the consideration for the use of sugar lands, fishponds, salt beds and of lands devoted to the raising of livestock shall be governed by stipulation between the parties". This Court has already ruled that "land in which fish is produced is classified as agricultural land." 5 The mere fact, however, that a person works an agricultural land does not necessarily make him a leasehold tenant within the purview of section 4 of Republic Act No. 1199. He may still be a civil law lessee unless the other requisites as above enumerated are complied with.

Regarding the second requisite, it is to be noted that the land in question has an area of 169,507 square meters, or roughly 17 hectares of fishpond. The

question of whether such a big parcel of land is susceptible of being worked by the appellant's family or not has not been raised, and We see no need of tarrying on this point. So, We pass to the third requisite, to wit, whether the tenant himself personally or with the aid of his immediate family worked the land.

Assuming that appellant had previously entered in 1923 into an agreement of leasehold tenancy with Potenciano Gabriel, appellee's father, such tenancy agreement was severed in 1956 when he ceased to work the fishpond personally because he became ill and incapacitated. Not even did the members of appellant's immediate farm household work the land in question. Only the members of the family of the tenant and such other persons, whether related to the tenant or not, who are dependent upon him for support and who usually help him to operate the farm enterprise are included in the term "immediate farm household" 6 The record shows who helped work the land in question, and We quote:

It also appears that the defendant has ceased to work personally with the aid of helpers the aforecited fishpond since 1956 when he became ill and incapacitated. His daughter, Pilar Pangilinan took over. She testified that she helps her father in administering the leased property, conveying his instructions to the workers, Urbano Maninang, Isidro Bernal and Marciano Maninang. The names of Ire, Juan and Aguedo Viada have been mentioned as the laborers who were paid for the repair of the dikes. Bernardo Cayanan, a nephew of the defendant, acts as the watcher. He has lived separately since he got married. Excepting Pilar Pangilinan, who is residing near the fishpond, the other children of the defendant are all professionals: a lawyer, an engineer, and a priest all residing in Manila. None of these persons has been seen working on the fishpond. 7

The law is explicit in requiring the tenant and his immediate family to work the land. Thus Section 5 (a) of Republic Act No. 1199, as amended, defines a "tenant" 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 in produce or in money or both, under the leasehold tenancy system. Section 8 of the same Act limits the relation of landholder and tenant to the person who furnishes the land and to the person who actually works the land himself with the aid of labor available from within his immediate farm household. Finally, Section 4 of the same Act requires for the existence of leasehold tenancy that the tenant and his immediate farm household work the land. It provides that leasehold tenancy exists when a person, who either personally or with the aid of labor available from members of his immediate farm household, undertakes to cultivate a piece of agricultural land susceptible of cultivation by a single person together with members of his immediate farm household, belonging to, or legally possessed by, another in consideration of a fixed amount in money or in produce or in both.

A person, in order to be considered a tenant, must himself and with the aid available from his immediate farm household cultivate the land. Persons, therefore, who do not actually work the land cannot be considered tenants; 8and he who hires others whom he pays for doing the cultivation of the land, ceases to hold, and is considered as having abandoned the land as tenant within the meaning of sections 5 and 8 of Republic Act. No. 1199, and ceases to enjoy the status, rights, and privileges of one.

We are, therefore, constrained to agree with the court a quo that the relationship between the appellee Trinidad Gabriel and appellant Eusebio Pangilinan was not a leasehold tenancy under Republic Act No. 1199. Hence, this case was not within the original and exclusive jurisdiction of the Court of Agrarian Relations. 9

2. Regarding the second assignment of error, We accordingly rule that the Court of First Instance correctly assumed jurisdiction over the case at bar, this being a case of civil law lease.

3. We deem it unnecessary to discuss the third and fourth assigned errors as these are issues involving findings of facts which have been settled by the lower court, and unless there is grave abuse of discretion, which we do not find in the record of the case, We shall not venture to discuss the merits of the factual findings of the court a quo.

IN VIEW OF THE FOREGOING, the decision of the Court of First Instance of Pampanga in its Civil Case No. 1823, appealed from, is affirmed, with costs against the appellants.

This decision should apply to the heirs and successors-in-interest of the original parties, as named in this decision. In consonance with the decision of the lower court, the heirs and successors-in-interest of appellant Eusebio Pangilinan should deliver the possession of the fishpond in question to the heirs and successors-in-interest of appellee Trinidad Gabriel; and said heirs and successors-in-interest of appellant Eusebio Pangilinan should pay the heirs and successors-in-interest of appellee Trinidad Gabriel the accrued rentals. From January 1, 1960, at the rate of P1,200.00 a year, until the actual delivery of the possession of the fishpond as herein ordered, with interest at the legal rate until full payment is made.

IT IS SO ORDERED.

Fernando, Antonio, Fernandez and Aquino, JJ., concur.

Barredo, J., took no part.

G.R. No. 132477 August 31, 2005

JOSE LUIS ROS, ANDONI F. ABOITIZ, XAVIER ABOITIZ, ROBERTO E. ABOITIZ, ENRIQUE ABOITIZ, MATTHIAS G. MENDEZONA, CEBU INDUSTRIAL PARK DEVELOPERS, INC. and FBM ABOITIZ MARINE, INC., Petitioners, vs. DEPARTMENT OF AGRARIAN REFORM, HON. ERNESTO GARILAO, in his capacity as DAR Secretary, and DIR. JOSE LLAMES, in his capacity as Director of DAR-Regional 7, Respondent.

D E C I S I O N

CHICO-NAZARIO, J.:

Petitioners are the owners/developers of several parcels of land located in Arpili, Balamban, Cebu. By virtue of Municipal Ordinance No. 101 passed by the Municipal Council of Balamban, Cebu, these lands were reclassified as industrial lands.1 On 03 April 1995, the Provincial Board of Cebu approved Balambans land use plan and adopteden toto Balambans Municipal Ordinance No. 101 with the passage of Resolution No. 836-95 and Provincial Ordinance No. 95-8, respectively.2 As part of their preparation for the development of the subject lands as an industrial park, petitioners secured all the necessary permits and appropriate government certifications.3

Despite these permits and certifications, petitioner Matthias Mendezona received a letter from Mr. Jose Llames, Director of the Department of Agrarian Reform (DAR) Regional Office for Region 7, informing him that the DAR was disallowing the conversion of the subject lands for industrial use and directed him to cease and desist from further developments on the land to avoid the incurrence of civil and criminal liabilities.4

Petitioners were thus constrained to file with the Regional Trial Court (RTC) of Toledo City a Complaint dated 29 July 1996 for Injunction with Application for Temporary Restraining Order and a Writ of Preliminary Injunction, docketed as Civil Case No. T-590.5 In an order6 dated 12 August 1996, the RTC, ruling that it is the DAR which has jurisdiction, dismissed the Complaint for lack of jurisdiction.7 It justified the dismissal in this wise:

A perusal of Section 20 of the Local Government Code expressly provides that the Municipalities through an Ordinance by the Sanggunian may authorize the reclassification of the agricultural land within their area into non-agricultural. Paragraph (e) of the aforesaid Section, provides further: that nothing in this Section shall be construed as repealing or modifying in any manner the provision of Republic Act 6657. In an opinion of the Secretary of Justice, quoted: With respect of (sic) conversion of agricultural land to non-agricultural uses the authority of the DAR to approve the same may be exercise (sic) only from the date of the effectivity of the Agrarian Reform Law on June 15, 1988. It appears that the petitioners had applied for conversion on June 13, 1995 and therefore the petitioner (sic) are estopped from questioning the authority and jurisdiction of the Department of Agrarian Reform. The application having been filed after June 15, 1988, the reclassification by the Municipal Council of Balamban was just a step in the conversion of the aforestated lands according to its purpose. Executive Order No. 129-A, Section 5, "The Department shall be responsible for implementing Comprehensive Agrarian Reform and for such purpose it is authorized to (J) approve or disapprove the conversion, restructuring or readjustment of agricultural land into non-agricultural uses." Said Executive Order amended Section 36 of Republic Act No. 3644 which clearly mandates that the DAR Secretary (sic) approve or disapprove conversion are not impliedly repealed. In fact, under Section 75 of Republic Act 6657 the above laws and other laws not inconsistent of (sic) this act shall have suppletory effect. Further, Section 68 of Republic Act 6657 provides: No injunction, restraining order, prohibition or mandamus shall be issued by the lower court against the Department of Agrarian Reform, DENR and Department of Justice in their implementation of the program. With this provision, it is therefore clear (sic) when there is conflict of laws determining whether the Department of Agrarian Reform has been exclusively empowered by law to approve land conversion after June 15, 1988 and (sic) the final ruling falls only with the Supreme Court or Office of the President.

WHEREFORE, in view of the foregoing, the Application for Restraining Order is hereby ordered DENIED and the main case is DISMISSED, this Court having no jurisdiction over the same.8

In an order dated 18 September 1996, the trial court denied the motion for reconsideration filed by the petitioners.9Petitioners filed before this Court a Petition for Review on Certiorari with application for Temporary Restraining Order and Writ of Preliminary Injunction.10 In a resolution11 dated 11 November 1996, this Court referred the petition to the Court of

Appeals.12 Petitioners moved for a reconsideration of the said resolution but the same was denied in a resolution dated 27 January 1997.13

At the Court of Appeals, the public respondents were ordered14 to file their Comments on the petition. Two sets of comments from the public respondents, one from the Department of Agrarian Reform Provincial Office15 and another from the Office of the Solicitor General,16 were submitted, to which petitioners filed their Consolidated Reply.17

On 02 December 1997, the Court of Appeals rendered a decision18 affirming the Order of Dismissal issued by the RTC.19 A motion for reconsideration filed by the petitioners was denied in a resolution dated 30 January 1998.20

Hence, this petition.

The following issues21 are raised by the petitioners for resolution:

(a) Whether or not the reclassification of the subject lands to industrial use by the Municipality of Balamban, Cebu pursuant to its authority under Section 20(a) of Republic Act No. 7160 or the Local Government Code of 1991 (the "LGC") has the effect of taking such lands out of the coverage of the CARL and beyond the jurisdiction of the DAR;

(b) Whether or not the Complaint for Injunction may be dismissed under the doctrine of primary jurisdiction;

(c) Whether or not the Complaint for Injunction is an appropriate remedy against the order of the DAR enjoining development works on the subject lands;

(d) Whether or not the Regional Trial Court of Toledo City had authority to issue a writ of injunction against the DAR.

In sum, petitioners are of the view that local governments have the power to reclassify portions of their agricultural lands, subject to the conditions set forth in Section 202223of the Local Government Code. According to them, if the agricultural land sought to be reclassified by the local government is one which has already been brought under the coverage of the Comprehensive

Agrarian Reform Law (CARL) and/or which has been distributed to agrarian reform beneficiaries, then such reclassification must be confirmed by the DAR pursuant to its authority under Section 6522 of the CARL, in order for the reclassification to become effective. If, however, the land sought to be reclassified is not covered by the CARL and not distributed to agrarian reform beneficiaries, then no confirmation from the DAR is necessary in order for the reclassification to become effective as such case would not fall within the DARs conversion authority. Stated otherwise, Section 65 of the CARL does not, in all cases, grant the DAR absolute, sweeping and all-encompassing power to approve or disapprove reclassifications or conversions of all agricultural lands. Said section only grants the DAR exclusive authority to approve or disapprove conversions of agricultural lands which have already been brought under the coverage of the CARL and which have already been distributed to farmer beneficiaries.

The petition lacks merit.

After the passage of Republic Act No. 6657, otherwise known as Comprehensive Agrarian Reform Program, agricultural lands, though reclassified, have to go through the process of conversion, jurisdiction over which is vested in the DAR. However, agricultural lands already reclassified before the effectivity of Rep. Act No. 6657 are exempted from conversion.

Department of Justice Opinion No. 44, Series of 1990, provides:

". . . True, the DARs express power over land use conversion is limited to cases in which agricultural lands already awarded have, after five years, ceased to be economically feasible and sound for agricultural purposes, or the locality has become urbanized and the land will have a greater economic value for residential, commercial or industrial purposes. But to suggest that these are the only instances when the DAR can require conversion clearances would open a loophole in R.A. No. 6657, which every landowner may use to evade compliance with the agrarian reform program. Hence, it should logically follow from the said departments express duty and function to execute and enforce the said statute that any reclassification of a private land as a residential, commercial or industrial property should first be cleared by the DAR."

The requirement that agricultural lands must go through the process of conversion despite having undergone reclassification was underscored in the case of Alarcon v. Court of Appeals,24 where it was held that reclassification of land does not suffice:

In the case at bar, there is no final order of conversion. The subject landholding was merely reclassified. Conversion is different from reclassification. Conversion is the act of changing the current use of a piece of agricultural land into some other use as approved by the Department of Agrarian Reform. Reclassification, on the other hand, is the act of specifying how agricultural lands shall be utilized for non-agricultural uses such as residential, industrial, commercial, as embodied in the land use plan, subject to the requirements and procedure for land use conversion. Accordingly, a mere reclassification of agricultural land does not automatically allow a landowner to change its use and thus cause the ejectment of the tenants. He has to undergo the process of conversion before he is permitted to use the agricultural land for other purposes.

Rep. Act No. 6657 took effect on 15 June 1988. Municipal Ordinance No. 101 of Balamban, Cebu, which reclassified the subject lands, was passed on 25 March 1992, and Provincial Ordinance No. 95-8 of the Provincial Board of Cebu, which adopted Municipal Ordinance No. 101, was passed on 03 April 1995, long after Rep. Act No. 6657 has taken effect. Section 4 of Rep. Act No. 6657 provides:

SEC. 4. Scope. The Comprehensive Agrarian Reform Law of 1988 shall cover, regardless of tenurial arrangement and commodity produced, all public and private agricultural lands as provided in Proclamation No. 131 and Executive Order No. 229, including other lands of the public domain suitable for agriculture.

. . .

(d) All private lands devoted to or suitable for agriculture regardless of the agricultural products raised or that can be raised thereon.

To further clarify any doubt on its authority, the DAR issued Administrative Order No. 12 dated October 1994 which reads:

Administrative Order No. 12

Series of 1994

SUBJECT: CONSOLIDATED AND REVISED RULES AND PROCEDURES GOVERNING CONVERSION OF ARICULTURAL LANDS TO NON-AGRICULTURAL USES

I. PREFATORY STATEMENT

The guiding principles on land use conversion is to preserve prime agricultural lands. On the other hand, conversion of agricultural lands, when coinciding with the objectives of the Comprehensive Agrarian Reform Law to promote social justice, industrialization, and the optimum use of land as a national resource for public welfare, shall be pursued in a speedy and judicious manner.

To rationalize these principles, and by virtue of Republic Act (R.A.) No. 3844, as amended, Presidential Decree (P.D.) No. 27, P.D. No. 946, Executive Order (E.O.) No. 129-A and R.A. No. 6657, the Department of Agrarian Reform (DAR) has issued several policy guidelines to regulate land use conversion. This Administrative Order consolidates and revises all existing implementing guidelines issued by the DAR, taking into consideration, other Presidential issuances and national policies related to land use conversion.

II. LEGAL MANDATE

A. The Department of Agrarian Reform (DAR) is mandated to "approve or disapprove applications for conversion, restructuring or readjustment of agricultural lands into non-agricultural uses," pursuant to Section 4(i) of Executive Order No. 129-A, Series of 1987.

B. Section 5(i) of E.O. No. 129-A, Series of 1987, vests in the DAR, exclusive authority to approve or disapprove applications for conversion of agricultural lands for residential, commercial, industrial, and other land uses.

C. Section 65 of R.A. No. 6657, otherwise known as the Comprehensive Agrarian Reform Law of 1988, likewise empowers the DAR to authorize

under certain conditions, the reclassification or conversion of agricultural lands.

D. Section 4 of Memorandum Circular No. 54, Series of 1993 of the Office of the President, provides that "action on applications for land use conversion on individual landholdings shall remain as the responsibility of the DAR, which shall utilize as its primary reference, documents on the comprehensive land use plans and accompanying ordinances passed upon and approved by the local government units concerned, together with the National Land Use Policy, pursuant to R.A. No. 6657 and E.O. No. 129-A."

III. DEFINITION OF TERMS

A. Agricultural land refers to land devoted to agricultural activity and not classified as mineral, forest, residential, commercial or industrial land (Section 3[c], R.A. No. 6657).

B. Conversion is the act of changing the current use of a piece of agricultural land into some other use.

C. Reclassification of agricultural lands is the act of specifying how agricultural lands shall be utilized for non-agricultural uses such as residential, industrial, commercial, as embodied in the land use plan. It also includes the reversion of non-agricultural lands to agricultural use.

. . .

V. COVERAGE

These rules shall cover all private agricultural lands as defined herein regardless of tenurial arrangement and commodity produced. It shall also include agricultural lands reclassified by LGUs into non-agricultural uses, after June 15, 1988, pursuant to Memorandum Circular (M.C.) No. 54, Series of 1993 of the Office of the President and those proposed to be used for livestock, poultry and swine raising as provided in DAR Administrative Order No. 9, Series of 1993.

In the case of Advincula-Velasquez v. Court of Appeals,25 we held:

Our ruling in the Natalia case was reiterated in National Housing Authority v. Allarde (318 SCRA 22 [1999]).

The Court of Appeals reliance on DOJ Opinion No. 44, Series of 1990, is in order. In the said opinion, the Secretary of Justice declared, viz:

Based on the foregoing premises, we reiterate the view that with respect to conversions of agricultural lands covered by R.A. No. 6657 to non-agricultural uses, the authority of DAR to approve such conversions may be exercised from the date of the laws effectivity on June 15, 1988. This conclusion is based on a liberal interpretation of R.A. No. 6657 in the light of DARs mandate and extensive coverage of the agrarian reform program.

Following the DOJ opinion, the DAR issued Administrative Order No. 6, Series of 1994, stating that lands already classified as non-agricultural before the enactment of Rep. Act No. 6657 no longer needed any conversion clearance:

I. Prefatory Statement

In order to streamline the issuance of exemption clearances, based on DOJ Opinion No. 44, the following guidelines are being issued for the guidance of the DAR and the public in general.

II. Legal Basis

Sec. 3(c) of RA 6657 states that agricultural lands refers to the land devoted to agricultural activity as defined in this act and not classified as mineral, forest, residential, commercial or industrial land.

Department of Justice Opinion No. 44, series of 1990 has ruled that, with respect to the conversion of agricultural lands covered by RA No. 6657 to non-agricultural uses, the authority of DAR to approve such conversion may be exercised from the date of its effectivity, on June 15, 1988. Thus, all lands that are already classified as commercial, industrial, or residential before 15 June 1988 no longer need any conversion clearance.

The authority of the DAR to approve conversions of agricultural lands covered by Rep. Act No. 6657 to non-agricultural uses has not been pierced by the passage of the Local Government Code. The Code explicitly provides26 that "nothing in this section shall be construed as repealing or modifying in any manner the provisions of Rep. Act No. 6657."

It being settled that jurisdiction over conversion of land is vested in the DAR, the complaint for injunction was correctly dismissed by the trial and appellate courts under the doctrine of primary jurisdiction. This Court, in Bautista v. Mag-isa Vda. De Villena,27 found occasion to reiterate the doctrine of primary jurisdiction

The doctrine of primary jurisdiction precludes the courts from resolving a controversy over which jurisdiction has initially been lodged with an administrative body of special competence. For agrarian reform cases, jurisdiction is vested in the Department of Agrarian Reform (DAR); more specifically, in the Department of Agrarian Reform Adjudication Board (DARAB).

Executive Order 229 vested the DAR with (1) quasi-judicial powers to determine and adjudicate agrarian reform matters; and (2) jurisdiction over all matters involving the implementation of agrarian reform, except those falling under the exclusive original jurisdiction of the Department of Agriculture and the Department of Environment and Natural Resources. This law divested the regional trial courts of their general jurisdiction to try agrarian reform matters.

Under Republic Act 6657, the DAR retains jurisdiction over all agrarian reform matters. The pertinent provision reads:

"Section 50. Quasi-Judicial Powers of the DAR. The DAR is hereby vested with the primary jurisdiction to determine and adjudicate agrarian reform matters and shall have exclusive original jurisdiction over all matters involving the implementation of agrarian reform, except those falling under the exclusive jurisdiction of the Department of Agriculture and the Department of Environment and Natural Resources.

"It shall not be bound by technical rules of procedure and evidence but shall proceed to hear and decide all cases, disputes or controversies in a most

expeditious manner, employing all reasonable means to ascertain the facts of every case in accordance with justice and equity and the merits of the case. Toward this end, it shall adopt a uniform rule of procedure to achieve a just, expeditious and inexpensive determination of every action or proceeding before it. . . ."

Finally, the third and fourth issues which may be summed up into whether or not an injunction is the appropriate remedy against the order of the DAR enjoining petitioners in developing the subject land, we rule in the negative. Section 68 of Rep. Act No. 6657 provides:

SEC. 68. Immunity of Government Agencies from Undue Interference. No injunction, restraining order, prohibition or mandamus shall be issued by the lower courts against the Department of Agrarian Reform (DAR), the Department of Agriculture (DA), the Department of Environment and Natural Resources (DENR), and the Department of Justice (DOJ) in their implementation of the program.

Wherefore, premises considered, the instant petition is Denied for lack of merit. The decision of the Court of Appeals in CA-G.R. SP No. 42666 dated 02 December 1997 affirming the order dated 12 August 1996 of the Regional Trial Court of Toledo City, Branch 29, in Civil Case No. T-590 is AFFIRMED. Costs against petitioners.

SO ORDERED.

G.R. No. 183409 June 18, 2010

CHAMBER OF REAL ESTATE AND BUILDERS ASSOCIATIONS, INC. (CREBA), petitioner, vs. THE SECRETARY OF AGRARIAN REFORM, Respondent.

D E C I S I O N

PEREZ, J.:

This case is a Petition for Certiorari and Prohibition (with application for temporary restraining order and/or writ of preliminary injunction) under Rule 65 of the 1997 Revised Rules of Civil Procedure, filed by herein petitioner Chamber of Real Estate and Builders Associations, Inc. (CREBA) seeking to nullify and prohibit the enforcement of Department of Agrarian Reform (DAR) Administrative Order (AO) No. 01-02, as amended by DAR AO No. 05-07,1and DAR Memorandum No. 88,2 for having been issued by the Secretary of Agrarian Reform with grave abuse of discretion amounting to lack or excess of jurisdiction as some provisions of the aforesaid administrative issuances are illegal and unconstitutional.

Petitioner CREBA, a private non-stock, non-profit corporation duly organized and existing under the laws of the Republic of the Philippines, is the umbrella organization of some 3,500 private corporations, partnerships, single proprietorships and individuals directly or indirectly involved in land and housing development, building and infrastructure construction, materials production and supply, and services in the various related fields of engineering, architecture, community planning and development financing. The Secretary of Agrarian Reform is named respondent as he is the duly appointive head of the DAR whose administrative issuances are the subject of this petition.

The Antecedent Facts

The Secretary of Agrarian Reform issued, on 29 October 1997, DAR AO No. 07-97,3 entitled "Omnibus Rules and Procedures Governing Conversion of Agricultural Lands to Non-Agricultural Uses," which consolidated all existing implementing guidelines related to land use conversion. The aforesaid rules

embraced all private agricultural lands regardless of tenurial arrangement and commodity produced, and all untitled agricultural lands and agricultural lands reclassified by Local Government Units (LGUs) into non-agricultural uses after 15 June 1988.

Subsequently, on 30 March 1999, the Secretary of Agrarian Reform issued DAR AO No. 01-99,4 entitled "Revised Rules and Regulations on the Conversion of Agricultural Lands to Non-agricultural Uses," amending and updating the previous rules on land use conversion. Its coverage includes the following agricultural lands, to wit: (1) those to be converted to residential, commercial, industrial, institutional and other non-agricultural purposes; (2) those to be devoted to another type of agricultural activity such as livestock, poultry, and fishpond the effect of which is to exempt the land from the Comprehensive Agrarian Reform Program (CARP) coverage; (3) those to be converted to non-agricultural use other than that previously authorized; and (4) those reclassified to residential, commercial, industrial, or other non-agricultural uses on or after the effectivity of Republic Act No. 66575 on 15 June 1988 pursuant to Section 206 of Republic Act No. 71607 and other pertinent laws and regulations, and are to be converted to such uses.

On 28 February 2002, the Secretary of Agrarian Reform issued another Administrative Order, i.e., DAR AO No. 01-02, entitled "2002 Comprehensive Rules on Land Use Conversion," which further amended DAR AO No. 07-97 and DAR AO No. 01-99, and repealed all issuances inconsistent therewith. The aforesaid DAR AO No. 01-02 covers all applications for conversion from agricultural to non-agricultural uses or to another agricultural use.

Thereafter, on 2 August 2007, the Secretary of Agrarian Reform amended certain provisions8 of DAR AO No. 01-02 by formulating DAR AO No. 05-07, particularly addressing land conversion in time of exigencies and calamities.

To address the unabated conversion of prime agricultural lands for real estate development, the Secretary of Agrarian Reform further issued Memorandum No. 88 on 15 April 2008, which temporarily suspended the processing and approval of all land use conversion applications.

By reason thereof, petitioner claims that there is an actual slow down of housing projects, which, in turn, aggravated the housing shortage,

unemployment and illegal squatting problems to the substantial prejudice not only of the petitioner and its members but more so of the whole nation.

Hence, this petition.

The Issues

In its Memorandum, petitioner posits the following issues:

I.

WHETHER THE DAR SECRETARY HAS JURISDICTION OVER LANDS THAT HAVE BEEN RECLASSIFIED AS RESIDENTIAL, COMMERCIAL, INDUSTRIAL, OR FOR OTHER NON-AGRICULTURAL USES.

II.

WHETHER THE DAR SECRETARY ACTED IN EXCESS OF HIS JURISDICTION AND GRAVELY ABUSED HIS DISCRETION BY ISSUING AND ENFORCING [DAR AO NO. 01-02, AS AMENDED] WHICH SEEK TO REGULATE RECLASSIFIED LANDS.

III.

WHETHER [DAR AO NO. 01-02, AS AMENDED] VIOLATE[S] THE LOCAL AUTONOMY OF LOCAL GOVERNMENT UNITS.

IV.

WHETHER [DAR AO NO. 01-02, AS AMENDED] VIOLATE[S] THE DUE PROCESS AND EQUAL PROTECTION CLAUSE[S] OF THE CONSTITUTION.

V.

WHETHER MEMORANDUM NO. 88 IS A VALID EXERCISE OF POLICE POWER.9

The subject of the submission that the DAR Secretary gravely abused his discretion is AO No. 01-02, as amended, which states:

Section 3. Applicability of Rules. These guidelines shall apply to all applications for conversion, from agricultural to non-agricultural uses or to another agricultural use, such as:

x x x x

3.4 Conversion of agricultural lands or areas that have been reclassified by the LGU or by way of a Presidential Proclamation, to residential, commercial, industrial, or other non-agricultural uses on or after the effectivity of RA 6657 on 15 June 1988, x x x. [Emphasis supplied].

Petitioner holds that under Republic Act No. 6657 and Republic Act No. 8435,10 the term agricultural lands refers to "lands devoted to or suitable for 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 a person whether natural or juridical, and not classified by the law as mineral, forest, residential, commercial or industrial land." When the Secretary of Agrarian Reform, however, issued DAR AO No. 01-02, as amended, he included in the definition of agricultural lands "lands not reclassified as residential, commercial, industrial or other non-agricultural uses before 15 June 1988." In effect, lands reclassified from agricultural to residential, commercial, industrial, or other non-agricultural uses after 15 June 1988 are considered to be agricultural lands for purposes of conversion, redistribution, or otherwise. In so doing, petitioner avows that the Secretary of Agrarian Reform acted without jurisdiction as he has no authority to expand or enlarge the legal signification of the term agricultural lands through DAR AO No. 01-02. Being a mere administrative issuance, it must conform to the statute it seeks to implement, i.e., Republic Act No. 6657, or to the Constitution, otherwise, its validity or constitutionality may be questioned.

In the same breath, petitioner contends that DAR AO No. 01-02, as amended, was made in violation of Section 6511of Republic Act No. 6657 because it covers all applications for conversion from agricultural to non-agricultural uses or to other agricultural uses, such as the conversion of

agricultural lands or areas that have been reclassified by the LGUs or by way of Presidential Proclamations, to residential, commercial, industrial or other non-agricultural uses on or after 15 June 1988. According to petitioner, there is nothing in Section 65 of Republic Act No. 6657 or in any other provision of law that confers to the DAR the jurisdiction or authority to require that non-awarded lands or reclassified lands be submitted to its conversion authority. Thus, in issuing and enforcing DAR AO No. 01-02, as amended, the Secretary of Agrarian Reform acted with grave abuse of discretion amounting to lack or excess of jurisdiction.

Petitioner further asseverates that Section 2.19,12 Article I of DAR AO No. 01-02, as amended, making reclassification of agricultural lands subject to the requirements and procedure for land use conversion, violates Section 20 of Republic Act No. 7160, because it was not provided therein that reclassification by LGUs shall be subject to conversion procedures or requirements, or that the DARs approval or clearance must be secured to effect reclassification. The said Section 2.19 of DAR AO No. 01-02, as amended, also contravenes the constitutional mandate on local autonomy under Section 25,13 Article II and Section 2,14 Article X of the 1987 Philippine Constitution.

Petitioner similarly avers that the promulgation and enforcement of DAR AO No. 01-02, as amended, constitute deprivation of liberty and property without due process of law. There is deprivation of liberty and property without due process of law because under DAR AO No. 01-02, as amended, lands that are not within DARs jurisdiction are unjustly, arbitrarily and oppressively prohibited or restricted from legitimate use on pain of administrative and criminal penalties. More so, there is discrimination and violation of the equal protection clause of the Constitution because the aforesaid administrative order is patently biased in favor of the peasantry at the expense of all other sectors of society.

As its final argument, petitioner avows that DAR Memorandum No. 88 is not a valid exercise of police power for it is the prerogative of the legislature and that it is unconstitutional because it suspended the land use conversion without any basis.

The Courts Ruling

This petition must be dismissed.

Primarily, although this Court, the Court of Appeals and the Regional Trial Courts have concurrent jurisdiction to issue writs of certiorari, prohibition, mandamus, quo warranto, habeas corpus and injunction, such concurrence does not give the petitioner unrestricted freedom of choice of court forum.15 In Heirs of Bertuldo Hinog v. Melicor,16citing People v. Cuaresma,17 this Court made the following pronouncements:

This Court's original jurisdiction to issue writs of certiorari is not exclusive. It is shared by this Court with Regional Trial Courts and with the Court of Appeals. This concurrence of jurisdiction is not, however, to be taken as according to parties seeking any of the writs an absolute, unrestrained freedom of choice of the court to which application therefor will be directed. There is after all a hierarchy of courts. That hierarchy is determinative of the venue of appeals, and also serves as a general determinant of the appropriate forum for petitions for the extraordinary writs. A becoming regard for that judicial hierarchy most certainly indicates that petitions for the issuance of extraordinary writs against first level ("inferior") courts should be filed with the Regional Trial Court, and those against the latter, with the Court of Appeals. A direct invocation of the Supreme Courts original jurisdiction to issue these writs should be allowed only when there are special and important reasons therefor, clearly and specifically set out in the petition. This is [an] established policy. It is a policy necessary to prevent inordinate demands upon the Courts time and attention which are better devoted to those matters within its exclusive jurisdiction, and to prevent further over-crowding of the Courts docket.18 (Emphasis supplied.)

The rationale for this rule is two-fold: (a) it would be an imposition upon the precious time of this Court; and (b) it would cause an inevitable and resultant delay, intended or otherwise, in the adjudication of cases, which in some instances had to be remanded or referred to the lower court as the proper forum under the rules of procedure, or as better equipped to resolve the issues because this Court is not a trier of facts.19

This Court thus reaffirms the judicial policy that it will not entertain direct resort to it unless the redress desired cannot be obtained in the appropriate courts, and exceptional and compelling circumstances, such as cases of national interest and of serious implications, justify the availment of the

extraordinary remedy of writ of certiorari, calling for the exercise of its primary jurisdiction.20

Exceptional and compelling circumstances were held present in the following cases: (a) Chavez v. Romulo,21 on citizens right to bear arms; (b) Government of [the] United States of America v. Hon. Purganan,22 on bail in extradition proceedings; (c) Commission on Elections v. Judge Quijano-Padilla,23 on government contract involving modernization and computerization of voters registration list; (d) Buklod ng Kawaning EIIB v. Hon. Sec. Zamora,24on status and existence of a public office; and (e) Hon. Fortich v. Hon. Corona,25 on the so-called "Win-Win Resolution" of the Office of the President which modified the approval of the conversion to agro-industrial area.26

In the case at bench, petitioner failed to specifically and sufficiently set forth special and important reasons to justify direct recourse to this Court and why this Court should give due course to this petition in the first instance, hereby failing to fulfill the conditions set forth in Heirs of Bertuldo Hinog v. Melicor.27 The present petition should have been initially filed in the Court of Appeals in strict observance of the doctrine on the hierarchy of courts. Failure to do so is sufficient cause for the dismissal of this petition.

Moreover, although the instant petition is styled as a Petition for Certiorari, in essence, it seeks the declaration by this Court of the unconstitutionality or illegality of the questioned DAR AO No. 01-02, as amended, and Memorandum No. 88. It, thus, partakes of the nature of a Petition for Declaratory Relief over which this Court has only appellate, not original, jurisdiction.28 Section 5, Article VIII of the 1987 Philippine Constitution provides:

Sec. 5. The Supreme Court shall have the following powers:

(1) Exercise original jurisdiction over cases affecting ambassadors, other public ministers and consuls, and over petitions for certiorari, prohibition, mandamus, quo warranto, and habeas corpus.

(2) Review, revise, reverse, modify, or affirm on appeal or certiorari as the law or the Rules of Court may provide, final judgments and orders of lower courts in:

(a) All cases in which the constitutionality or validity of any treaty, international or executive agreement, law, presidential decree, proclamation, order, instruction, ordinance, or regulation is in question. (Emphasis supplied.)

With that, this Petition must necessarily fail because this Court does not have original jurisdiction over a Petition for Declaratory Relief even if only questions of law are involved.

Even if the petitioner has properly observed the doctrine of judicial hierarchy, this Petition is still dismissible.

The special civil action for certiorari is intended for the correction of errors of jurisdiction only or grave abuse of discretion amounting to lack or excess of jurisdiction. Its principal office is only to keep the inferior court within the parameters of its jurisdiction or to prevent it from committing such a grave abuse of discretion amounting to lack or excess of jurisdiction.29

The essential requisites for a Petition for Certiorari under Rule 65 are: (1) the writ is directed against a tribunal, a board, or an officer exercising judicial or quasi-judicial functions; (2) such tribunal, board, or officer has acted without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction; and (3) there is no appeal or any plain, speedy, and adequate remedy in the ordinary course of law.30

Excess of jurisdiction as distinguish