[G.R. No. 93100.

June 19, 1997]

ATLAS FERTILIZER CORPORATION, petitioner, vs. THE HONORABLE SECRETAR OF THE !EPART"ENT OF AGRARIAN REFOR",
respondent.
[G.R. No. 97#$$. June 19, 1997]
PHILIPPINE FE!ERATION OF FISHFAR" PRO!%CERS, INC., petitioner, vs. THE HONORABLE SECRETAR OF THE !EPART"ENT OF
AGRARIAN REFOR", respondent.
R E S O L U T I O N
ROMERO, J.:
Before this Court are consolidated petitions uestionin! the constitutionalit" of so#e portions of Repu$lic %ct No. &&'( other)ise *no)n as the Co#prehensi+e %!rarian Refor# La).
i
,-.
/etitioners %tlas 0ertili1er Corporation,
ii
,2. /hilippine 0ederation of 0ishfar# /roducers, Inc. and petitioner3in3inter+ention %rchie4s 0ishpond, Inc. and %rsenio %l. %cuna
iii
,5. are en!a!ed in
the auaculture industr" utili1in! fishponds and pra)n far#s. The" assail Sections 5 6$7, --, -5, -& 6d7, -( and 52 of R.%. &&'(, as )ell as the i#ple#entin! !uidelines and procedures
contained in %d#inistrati+e Order Nos. 8 and -9 Series of -:88 issued $" pu$lic respondent Secretar" of the ;epart#ent of %!rarian Refor# as unconstitutional.
/etitioners clai# that the uestioned pro+isions of C%RL +iolate the Constitution in the follo)in! #anner:
-. Sections 5 6$7, --, -5, -& 6d7, -( and 52 of C%RL e<tend a!rarian refor# to auaculture lands e+en as Section =, %rticle >III of the constitution li#its a!rarian refor# onl" to a!riculture
lands.
2. The uestioned pro+isions si#ilarl" treat of auaculture lands and a!riculture lands )hen the" are differentl" situated, and differentl" treat auaculture lands and other industrial lands,
)hen the" are si#ilarl" situated in +iolation of the constitutional !uarantee of the eual protection of the la)s.
5. The uestioned pro+isions distort e#plo"#ent $enefits and $urdens in fa+or of auaculture e#plo"ees and a!ainst other industrial )or*ers e+en as Section - and 5, %rticle >III of the
Constitution #andate the State to pro#ote eualit" in econo#ic and e#plo"#ent opportunities.
=. The uestioned pro+isions depri+e petitioner of its !o+ern#ent3induced in+est#ents in auaculture e+en as Sections 2 and 5, %rticle >III of the Constitution #andate the State to
respect the freedo# of enterprise and the ri!ht of enterprises to reasona$le returns on in+est#ents and to e<pansion and !ro)th.
The constitutionalit" of the a$o+e3#entioned pro+isions has $een ruled upon in the case of Lu1 0ar#s, Inc. +. Secretar" of %!rarian Refor#
i+
,=. re!ardin! the inclusion of land de+oted to
the raisin! of li+estoc*, poultr" and s)ine in its co+era!e.
The issue no) $efore this Court is the constitutionalit" of the sa#e a$o+e3#entioned pro+isions insofar as the" include in its co+era!e lands de+oted to the auaculture industr",
particularl" fishponds and pra)n far#s.
In their first ar!u#ent, petitioners contend that in the case of Lu1 0ar#s, Inc. +. Secretar" of %!rarian Refor#,
+
,'. this Court has alread" ruled i#pliedl" that lands de+oted to fishin! are
not a!riculture lands. In auaculture, fishponds and pra)n far#s, the use of land is onl" incidental to and not the principal factor in producti+it" and, hence, as held in ?Lu1 0ar#s,@ the"
too should $e e<cluded fro# R.%. &&'( Aust as lands de+oted to li+estoc*, s)ine, and poultr" ha+e $een e<cluded for the sa#e reason. The" also ar!ue that the" are entitled to the full
$enefit of ?Lu1 0ar#s@ to the effect that onl" fi+e percent of the total in+est#ent in auaculture acti+ities, fishponds, and pra)n far#s, is in the for# of land, and therefore, cannot $e
classified as a!ricultural acti+it". 0urther, that in fishponds and pra)n far#s, there are no far#ers, nor far# )or*ers, )ho till lands, and no a!rarian unrest, and therefore, the
constitutionall" intended $eneficiaries under Section =, %rt. >III, -:8( Constitution do not e<ist in auaculture.
In their second ar!u#ent, the" contend that R.%. &&'(, $" includin! in its co+era!e, the raisin! of fish and auaculture operations includin! fishponds and pra)n ponds, treatin! the# as
in the sa#e class or classification as a!riculture or far#in! +iolates the eual protection clause of the Constitution and is, therefore, +oid. 0urther, the Constitutional Co##ission de$ates
sho) that the intent of the constitutional fra#ers is to e<clude ?industrial@ lands, to )hich cate!or" lands de+oted to auaculture, fishponds, and fish far#s $elon!.
/etitioners also clai# that %d#inistrati+e Order Nos. 8 and -9 issued $" the Secretar" of the ;epart#ent of %!rarian Refor# are, li*e)ise, unconstitutional, as held in ?Lu1 0ar#s,@ and
are therefore +oid as the" i#ple#ent the assailed pro+isions of C%RL.
The pro+isions of C%RL $ein! assailed as unconstitutional are as follo)s:
6a7 Section 56$7 )hich includes the ?raisin! of fish in the definition of ?%!ricultural, %!ricultural Enterprise or %!ricultural %cti+it".@ 6Underscorin! Supplied7
6$7 Section -- )hich defines ?co##ercial far#s@ as pri+ate a!ricultural lands de+oted to fishponds and pra)n ponds < < <.@ 6Underscorin! Supplied7
6c7 Section -5 )hich calls upon petitioner to e<ecute a production3sharin! plan.
6d7 Section -& 6d7 and -( )hich +est on the ;epart#ent of %!rarian refor# the authorit" to su##aril" deter#ine the Aust co#pensation to $e paid for lands co+ered $" the
co#prehensi+e %!rarian refor# La).
6e7 Section 52 )hich spells out the production3sharin! plan #entioned in Section -53
?< < < 6B7here$" three percent 65C7 of the !ross sales fro# the production of such lands are distri$uted )ithin si<t" 6&97 da"s at the end of the fiscal "ear as co#pensation to re!ular and
other far#)or*ers in such lands o+er and a$o+e the co#pensation the" currentl" recei+e: /ro+ided, That these indi+iduals or entities reali1e !ross sales in e<cess of fi+e #illion pesos
per annu# unless the ;%R, upon proper application, deter#ines a lo)er ceilin!.
In the e+ent that the indi+idual or entit" reali1es a profit, an additional ten percent 6-9C7 of the net profit after ta< shall $e distri$uted to said re!ular and other far#)or*ers )ithin ninet"
6:97 da"s of the end of the fiscal "ear. < < <@
Bhile the Court )ill not hesitate to declare a la) or an act +oid )hen confronted suarel" )ith constitutional issues, neither )ill it pree#pt the Le!islati+e and the E<ecuti+e $ranches of
the !o+ern#ent in correctin! or clarif"in!, $" #eans of a#end#ent, said la) or act. On 0e$ruar" 29, -::', Repu$lic %ct No. (88-
+i
,&. )as appro+ed $" Con!ress. /ro+isions of said %ct
pertinent to the assailed pro+isions of C%RL are the follo)in!:
?Section -. Section 5, /ara!raph 6$7 of Repu$lic %ct No. &&'( is here$" a#ended to read as follo)s:
?Sec. 5. ;efinitions. 33 0or the purpose of this %ct, unless the conte<t indicates other)ise:
?6$7 %!riculture, %!ricultural Enterprise or %!ricultural %cti+it" #eans the culti+ation of the soil, plantin! of crops, !ro)in! of fruit trees, includin! the har+estin! of such far# products and
other far# acti+ities and practices perfor#ed $" a far#er in conAunction )ith such far#in! operations done $" persons )hether natural or Auridical.@
Sec. 2. Section -9 of Repu$lic %ct No. &&'( is here$" a#ended to read as follo)s:
?Sec. -9. E<e#ptions and E<clusions.33
<<< <<< <<<
?$7 /ri+ate lands actuall", directl" and e<clusi+el" used for pra)n far#s and fishponds shall $e e<e#pt fro# the co+era!e of this %ct: /ro+ided, That said pra)n far#s and fishponds ha+e
not $een distri$uted and Certificate of Land O)nership %)ard 6CLO%7 issued to a!rarian refor# $eneficiaries under the Co#prehensi+e %!rarian Refor# /ro!ra#.
?In cases )here the fishponds or pra)n far#s ha+e $een su$Aected to the Co#prehensi+e %!rarian Refor# La), $" +oluntar" offer to sell, or co##ercial far#s defer#ent or notices of
co#pulsor" acuisition, a si#ple and a$solute #aAorit" of the actual re!ular )or*ers or tenants #ust consent to the e<e#ption )ithin one 6-7 "ear fro# the effecti+it" of this %ct. Bhen the
)or*ers or tenants do not a!ree to this e<e#ption, the fishponds or pra)n far#s shall $e distri$uted collecti+el" to the )or*er3$eneficiaries or tenants )ho shall for# a cooperati+e or
association to #ana!e the sa#e.
?In cases )here the fishponds or pra)n far#s ha+e not $een su$Aected to the Co#prehensi+e %!rarian Refor# La), the consent of the far# )or*ers shall no lon!er $e necessar",
ho)e+er, the pro+ision of Section 523% hereof on incenti+es shall appl".@
<<< <<< <<<
Sec. 5. Section --, para!raph - is here$" a#ended to read as follo)s:
?Sec. --. Co##ercial 0ar#in!.33 Co##ercial 0ar#s, )hich are pri+ate a!ricultural lands de+oted to salt $eds, fruit far#s, orchards, +e!eta$le and cut3flo)er far#s, and cacao, coffee
and ru$$er plantations, shall $e su$Aect to i##ediate co#pulsor" acuisition and distri$ution after ten 6-97 "ears fro# the effecti+it" of this %ct. In the case of ne) far#s, the ten3"ear
period shall $e!in fro# the first "ear of co##ercial production and operation, as deter#ined $" the ;%R. ;urin! the ten3"ear period, the Do+ern#ent shall initiate steps necessar" to
acuire these lands, upon pa"#ent of Aust co#pensation for the land and the i#pro+e#ents thereon, prefera$l" in fa+or of or!ani1ed cooperati+es or associations, )hich shall thereafter
#ana!e the said lands for the )or*ers3$eneficiaries.@
Sec. =. There shall $e incorporated after Section 52 of Repu$lic %ct No. &&'( a section to read as follo)s:
?Sec. 523%. Incenti+es.33 Indi+iduals or entities o)nin! or operatin! fishponds and pra)n far#s are here$" #andated to e<ecute )ithin si< 6&7 #onths fro# the effecti+it" of this %ct, an
incenti+e plan )ith their re!ular fishpond or pra)n far# )or*ers4 or!ani1ation, if an", )here$" se+en point fi+e percent 6(.'C7 of their net profit $efore ta< fro# the operation of the
fishpond or pra)n far#s are distri$uted )ithin si<t" 6&97 da"s at the end of the fiscal "ear as co#pensation to re!ular and other pond )or*ers in such ponds o+er and a$o+e the
co#pensation the" currentl" recei+e.
?In order to safe!uard the ri!ht of the re!ular fishpond or pra)n far# )or*ers under the incenti+e plan, the $oo*s of the fishpond or pra)n o)ners shall $e su$Aect to periodic audit or
inspection $" certified pu$lic accountants chosen $" the )or*ers.
?The fore!oin! pro+isions shall not appl" to a!ricultural lands su$seuentl" con+erted to fishponds or pra)n far#s pro+ided the si1e of the land con+erted does not e<ceed the retention
li#it of the lando)ner.@
The a$o+e3#entioned pro+isions of R.%. No. (88- e<pressl" state that fishponds and pra)n far#s are excluded fro# the co+era!e of C%RL. In +ie) of the fore!oin!, the uestion
concernin! the constitutionalit" of the assailed pro+isions has $eco#e #oot and acade#ic )ith the passa!e of R.%. No. (88-.
WHEREFORE, the petition is here$" ;ISMISSE;.
SO OR;ERE;.
i
ii
iii
iv
v
vi