G.R. No.

183409 June 18, 2010

CHAMBER OF REAL ESTATE AND BUILDERS ASSOCIATIONS, INC. (CREBA), petitioner,

vs.
THE SECRETARY OF AGRARIAN REFORM, Respondent.

DECISION

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:

xxxx

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 DAR’s 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 DAR’s 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 Court’s 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 Court’s 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 Court’s time and attention which are better devoted to those matters within its exclusive jurisdiction, and to prevent further
over-crowding of the Court’s 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 distinguished from absence of jurisdiction means that an act, though within the general power of a
tribunal, board or officer, is not authorized and invalid with respect to the particular proceeding, because the conditions which
alone authorize the exercise of the general power in respect of it are wanting. 31 Without jurisdiction means lack or want of legal
power, right or authority to hear and determine a cause or causes, considered either in general or with reference to a particular
matter. It means lack of power to exercise authority.32Grave abuse of discretion implies such capricious and whimsical exercise
of judgment as is equivalent to lack of jurisdiction or, in other words, where the power is exercised in an arbitrary manner by
reason of passion, prejudice, or personal hostility, and it must be so patent or gross as to amount to an evasion of a positive
duty or to a virtual refusal to perform the duty enjoined or to act at all in contemplation of law.33

In the case before this Court, the petitioner fails to meet the above-mentioned requisites for the proper invocation of a Petition
for Certiorari under Rule 65. The Secretary of Agrarian Reform in issuing the assailed DAR AO No. 01-02, as amended, as well
as Memorandum No. 88 did so in accordance with his mandate to implement the land use conversion provisions of Republic
Act No. 6657. In the process, he neither acted in any judicial or quasi-judicial capacity nor assumed unto himself any
performance of judicial or quasi-judicial prerogative. A Petition for Certiorari is a special civil action that may be invoked only
against a tribunal, board, or officer exercising judicial functions. Section 1, Rule 65 of the 1997 Revised Rules of Civil
Procedure is explicit on this matter, viz.:

SECTION 1. Petition for certiorari. – When any tribunal, board or officer exercising judicial or quasi-judicial functions has acted
without or in excess of its or his jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and
there is no appeal, nor any plain, speedy, and adequate remedy in the ordinary course of law, a person aggrieved thereby may
file a verified petition in the proper court, alleging the facts with certainty and praying that judgment must be rendered annulling
or modifying the proceedings of such tribunal, board or officer.1avvphi1

A tribunal, board, or officer is said to be exercising judicial function where it has the power to determine what the law is and
what the legal rights of the parties are, and then undertakes to determine these questions and adjudicate upon the rights of the
parties. Quasi-judicial function, on the other hand, is "a term which applies to the actions, discretion, etc., of public
administrative officers or bodies x x x required to investigate facts or ascertain the existence of facts, hold hearings, and draw
conclusions from them as a basis for their official action and to exercise discretion of a judicial nature." 34

Before a tribunal, board, or officer may exercise judicial or quasi-judicial acts, it is necessary that there be a law that gives rise
to some specific rights of persons or property under which adverse claims to such rights are made, and the controversy
ensuing therefrom is brought before a tribunal, board, or officer clothed with power and authority to determine the law and
adjudicate the respective rights of the contending parties. 35

The Secretary of Agrarian Reform does not fall within the ambit of a tribunal, board, or officer exercising judicial or quasi-judicial
functions. The issuance and enforcement by the Secretary of Agrarian Reform of the questioned DAR AO No. 01-02, as
amended, and Memorandum No. 88 were done in the exercise of his quasi-legislative and administrative functions and not of
judicial or quasi-judicial functions. In issuing the aforesaid administrative issuances, the Secretary of Agrarian Reform never
made any adjudication of rights of the parties. As such, it can never be said that the Secretary of Agrarian Reform had acted
with grave abuse of discretion amounting to lack or excess of jurisdiction in issuing and enforcing DAR AO No. 01-02, as
amended, and Memorandum No. 88 for he never exercised any judicial or quasi-judicial functions but merely his quasi-
legislative and administrative functions.

Furthermore, as this Court has previously discussed, the instant petition in essence 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. Thus, the
adequate and proper remedy for the petitioner therefor is to file a Petition for Declaratory Relief, which this Court has only
appellate and not original jurisdiction. It is beyond the province of certiorari to declare the aforesaid administrative issuances
unconstitutional and illegal because certiorari is confined only to the determination of the existence of grave abuse of discretion
amounting to lack or excess of jurisdiction. Petitioner cannot simply allege grave abuse of discretion amounting to lack or
excess of jurisdiction and then invoke certiorari to declare the aforesaid administrative issuances unconstitutional and illegal.
Emphasis must be given to the fact that the writ of certiorari dealt with in Rule 65 of the 1997 Revised Rules of Civil Procedure
is a prerogative writ, never demandable as a matter of right, "never issued except in the exercise of judicial discretion." 36

At any rate, even if the Court will set aside procedural infirmities, the instant petition should still be dismissed.
Executive Order No. 129-A37 vested upon the DAR the responsibility of implementing the CARP. Pursuant to the said mandate
and to ensure the successful implementation of the CARP, Section 5(c) of the said executive order authorized the DAR to
establish and promulgate operational policies, rules and regulations and priorities for agrarian reform implementation. Section
4(k) thereof authorized the DAR to approve or disapprove the conversion, restructuring or readjustment of agricultural lands
into non-agricultural uses. Similarly, Section 5(l) of the same executive order has given the DAR the exclusive authority to
approve or disapprove conversion of agricultural lands for residential, commercial, industrial, and other land uses as may be
provided for by law. Section 7 of the aforesaid executive order clearly provides that "the authority and responsibility for the
exercise of the mandate of the [DAR] and the discharge of its powers and functions shall be vested in the Secretary of Agrarian
Reform x x x."

Under DAR AO No. 01-02, as amended, "lands not reclassified as residential, commercial, industrial or other non-agricultural
uses before 15 June 1988" have been included in the definition of agricultural lands. In so doing, the Secretary of Agrarian
Reform merely acted within the scope of his authority stated in the aforesaid sections of Executive Order No. 129-A, which is to
promulgate rules and regulations for agrarian reform implementation and that includes the authority to define agricultural lands
for purposes of land use conversion. Further, the definition of agricultural lands under DAR AO No. 01-02, as amended, merely
refers to the category of agricultural lands that may be the subject for conversion to non-agricultural uses and is not in any way
confined to agricultural lands in the context of land redistribution as provided for under Republic Act No. 6657.

More so, Department of Justice Opinion No. 44, Series of 1990, which Opinion has been recognized in many cases decided by
this Court, clarified that after the effectivity of Republic Act No. 6657 on 15 June 1988 the DAR has been given the authority to
approve land conversion.38 Concomitant to such authority, therefore, is the authority to include in the definition of agricultural
lands "lands not reclassified as residential, commercial, industrial or other non-agricultural uses before 15 June 1988" for
purposes of land use conversion.

In the same vein, the authority of the Secretary of Agrarian Reform to include "lands not reclassified as residential, commercial,
industrial or other non-agricultural uses before 15 June 1988" in the definition of agricultural lands finds basis in jurisprudence.
In Ros v. Department of Agrarian Reform,39 this Court has enunciated that after the passage of Republic Act No. 6657,
agricultural lands, though reclassified, have to go through the process of conversion, jurisdiction over which is vested in the
DAR. However, agricultural lands, which are already reclassified before the effectivity of Republic Act No. 6657 which is 15
June 1988, are exempted from conversion.40 It bears stressing that the said date of effectivity of Republic Act No. 6657 served
as the cut-off period for automatic reclassifications or rezoning of agricultural lands that no longer require any DAR conversion
clearance or authority.41 It necessarily follows that any reclassification made thereafter can be the subject of DAR’s conversion
authority. Having recognized the DAR’s conversion authority over lands reclassified after 15 June 1988, it can no longer be
argued that the Secretary of Agrarian Reform was wrongfully given the authority and power to include "lands not reclassified as
residential, commercial, industrial or other non-agricultural uses before 15 June 1988" in the definition of agricultural lands.
Such inclusion does not unduly expand or enlarge the definition of agricultural lands; instead, it made clear what are the lands
that can be the subject of DAR’s conversion authority, thus, serving the very purpose of the land use conversion provisions of
Republic Act No. 6657.

The argument of the petitioner that DAR AO No. 01-02, as amended, was made in violation of Section 65 of Republic Act No.
6657, as it covers even those non-awarded lands and reclassified lands by the LGUs or by way of Presidential Proclamations
on or after 15 June 1988 is specious. As explained in Department of Justice Opinion No. 44, series of 1990, it is true that the
DAR’s express power over land use conversion provided for under Section 65 of Republic Act No. 6657 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. To suggest, however, that these are the only instances that the DAR can require conversion clearances
would open a loophole in Republic Act No. 6657 which every landowner may use to evade compliance with the agrarian reform
program. It should logically follow, therefore, from the said department’s 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, on or after the
effectivity of Republic Act No. 6657 on 15 June 1988 should first be cleared by the DAR. 42

This Court held in Alarcon v. Court of Appeals43 that reclassification of lands does not suffice. Conversion and reclassification
differ from each other. Conversion is the act of changing the current use of a piece of agricultural land into some other use as
approved by the DAR while reclassification is the act of specifying how agricultural lands shall be utilized for non-agricultural
uses such as residential, industrial, and commercial, as embodied in the land use plan, subject to the requirements and
procedures for land use conversion. In view thereof, a mere reclassification of an agricultural land does not automatically allow
a landowner to change its use. He has to undergo the process of conversion before he is permitted to use the agricultural land
for other purposes.44

It is clear from the aforesaid distinction between reclassification and conversion that agricultural lands though reclassified to
residential, commercial, industrial or other non-agricultural uses must still undergo the process of conversion before they can
be used for the purpose to which they are intended.

Nevertheless, emphasis must be given to the fact that DAR’s conversion authority can only be exercised after the effectivity of
Republic Act No. 6657 on 15 June 1988.45 The said date served as the cut-off period for automatic reclassification or rezoning
of agricultural lands that no longer require any DAR conversion clearance or authority.46Thereafter, reclassification of
agricultural lands is already subject to DAR’s conversion authority. Reclassification alone will not suffice to use the agricultural
lands for other purposes. Conversion is needed to change the current use of reclassified agricultural lands.

It is of no moment whether the reclassification of agricultural lands to residential, commercial, industrial or other non-agricultural
uses was done by the LGUs or by way of Presidential Proclamations because either way they must still undergo conversion
process. It bears stressing that the act of reclassifying agricultural lands to non-agricultural uses simply specifies how
agricultural lands shall be utilized for non-agricultural uses and does not automatically convert agricultural lands to non-
agricultural uses or for other purposes. As explained in DAR Memorandum Circular No. 7, Series of 1994, cited in the 2009
case of Roxas & Company, Inc. v. DAMBA-NFSW and the Department of Agrarian Reform,47 reclassification of lands denotes
their allocation into some specific use and providing for the manner of their utilization and disposition or the act of specifying
how agricultural lands shall be utilized for non-agricultural uses such as residential, industrial, or commercial, as embodied in
the land use plan. For reclassified agricultural lands, therefore, to be used for the purpose to which they are intended there is
still a need to change the current use thereof through the process of conversion. The authority to do so is vested in the DAR,
which is mandated to preserve and maintain agricultural lands with increased productivity. Thus, notwithstanding the
reclassification of agricultural lands to non-agricultural uses, they must still undergo conversion before they can be used for
other purposes.

Even reclassification of agricultural lands by way of Presidential Proclamations to non-agricultural uses, such as school sites,
needs conversion clearance from the DAR. We reiterate that reclassification is different from conversion. Reclassification alone
will not suffice and does not automatically allow the landowner to change its use. It must still undergo conversion process
before the landowner can use such agricultural lands for such purpose. 48Reclassification of agricultural lands is one thing,
conversion is another. Agricultural lands that are reclassified to non-agricultural uses do not ipso facto allow the landowner
thereof to use the same for such purpose. Stated differently, despite having reclassified into school sites, the landowner of such
reclassified agricultural lands must apply for conversion before the DAR in order to use the same for the said purpose.

Any reclassification, therefore, of agricultural lands to residential, commercial, industrial or other non-agricultural uses either by
the LGUs or by way of Presidential Proclamations enacted on or after 15 June 1988 must undergo the process of conversion,
despite having undergone reclassification, before agricultural lands may be used for other purposes.

It is different, however, when through Presidential Proclamations public agricultural lands have been reserved in whole or in
part for public use or purpose, i.e., public school, etc., because in such a case, conversion is no longer necessary. As held in
Republic v. Estonilo,49 only a positive act of the President is needed to segregate or reserve a piece of land of the public
domain for a public purpose. As such, reservation of public agricultural lands for public use or purpose in effect converted the
same to such use without undergoing any conversion process and that they must be actually, directly and exclusively used for
such public purpose for which they have been reserved, otherwise, they will be segregated from the reservations and
transferred to the DAR for distribution to qualified beneficiaries under the CARP. 50 More so, public agricultural lands already
reserved for public use or purpose no longer form part of the alienable and disposable lands of the public domain suitable for
agriculture.51 Hence, they are outside the coverage of the CARP and it logically follows that they are also beyond the
conversion authority of the DAR.

Clearly from the foregoing, the Secretary of Agrarian Reform did not act without jurisdiction or in excess of jurisdiction or with
grave abuse of discretion amounting to lack or excess of jurisdiction in (1) including lands not reclassified as residential,
commercial, industrial or other non-agricultural uses before 15 June 1988 in the definition of agricultural lands under DAR AO
No. 01-02, as amended, and; (2) issuing and enforcing DAR AO No. 01-02, as amended, subjecting to DAR’s jurisdiction for
conversion lands which had already been reclassified as residential, commercial, industrial or for other non-agricultural uses on
or after 15 June 1988.

Similarly, DAR AO No. 01-02, as amended, providing that the reclassification of agricultural lands by LGUs shall be subject to
the requirements of land use conversion procedure or that DAR’s approval or clearance must be secured to effect
reclassification, did not violate the autonomy of the LGUs.

Section 20 of Republic Act No. 7160 states that:

SECTION 20. Reclassification of Lands. – (a) A city or municipality may, through an ordinance passed by the sanggunian after
conducting public hearings for the purpose, authorize the reclassification of agricultural lands and provide for the manner of
their utilization or disposition in the following cases: (1) when the land ceases to be economically feasible and sound for
agricultural purposes as determined by the Department of Agriculture or (2) where the land shall have substantially greater
economic value for residential, commercial, or industrial purposes, as determined by the sanggunian concerned: Provided, That
such reclassification shall be limited to the following percentage of the total agricultural land area at the time of the passage of
the ordinance:

xxxx

(3) For fourth to sixth class municipalities, five percent (5%): Provided, further, That agricultural lands distributed to agrarian
reform beneficiaries pursuant to Republic Act Numbered Sixty-six hundred fifty-seven (R.A. No. 6657), otherwise known as
"The Comprehensive Agrarian Reform Law," shall not be affected by the said reclassification and the conversion of such lands
into other purposes shall be governed by Section 65 of said Act.

xxxx

(e) Nothing in this Section shall be construed as repealing, amending, or modifying in any manner the provisions of R.A. No.
6657.
The aforequoted provisions of law show that the power of the LGUs to reclassify agricultural lands is not absolute. The authority
of the DAR to approve conversion of agricultural lands covered by Republic Act No. 6657 to non-agricultural uses has been
validly recognized by said Section 20 of Republic Act No. 7160 by explicitly providing therein that, "nothing in this section shall
be construed as repealing or modifying in any manner the provisions of Republic Act No. 6657."

DAR AO No. 01-02, as amended, does not also violate the due process clause, as well as the equal protection clause of the
Constitution. In providing administrative and criminal penalties in the said administrative order, the Secretary of Agrarian
Reform simply implements the provisions of Sections 73 and 74 of Republic Act No. 6657, thus:

Sec. 73. Prohibited Acts and Omissions. – The following are prohibited:

xxxx

(c) The conversion by any landowner of his agricultural land into any non-agricultural use with intent to avoid the application of
this Act to his landholdings and to disposes his tenant farmers of the land tilled by them;

xxxx

(f) The sale, transfer or conveyance by a beneficiary of the right to use or any other usufructuary right over the land he acquired
by virtue of being a beneficiary, in order to circumvent the provisions of this Act.

xxxx

Sec. 74. Penalties. ─ Any person who knowingly or willfully violates the provisions of this Act shall be punished by
imprisonment of not less than one (1) month to not more than three (3) years or a fine of not less than one thousand pesos
(₱1,000.00) and not more than fifteen thousand pesos (₱15,000.00), or both, at the discretion of the court.

If the offender is a corporation or association, the officer responsible therefor shall be criminally liable.

And Section 11 of Republic Act No. 8435, which specifically provides:

Sec. 11. Penalty for Agricultural Inactivity and Premature Conversion. – x x x.

Any person found guilty of premature or illegal conversion shall be penalized with imprisonment of two (2) to six (6) years, or a
fine equivalent to one hundred percent (100%) of the government's investment cost, or both, at the discretion of the court, and
an accessory penalty of forfeiture of the land and any improvement thereon.

In addition, the DAR may impose the following penalties, after determining, in an administrative proceedings, that violation of
this law has been committed:

a. Consolation or withdrawal of the authorization for land use conversion; and

b. Blacklisting, or automatic disapproval of pending and subsequent conversion applications that they may file with
the DAR.

Contrary to petitioner’s assertions, the administrative and criminal penalties provided for under DAR AO No. 01-02, as
amended, are imposed upon the illegal or premature conversion of lands within DAR’s jurisdiction, i.e., "lands not reclassified
as residential, commercial, industrial or for other non-agricultural uses before 15 June 1998."

The petitioner’s argument that DAR Memorandum No. 88 is unconstitutional, as it suspends the land use conversion without
any basis, stands on hollow ground.

It bears emphasis that said Memorandum No. 88 was issued upon the instruction of the President in order to address the
unabated conversion of prime agricultural lands for real estate development because of the worsening rice shortage in the
country at that time. Such measure was made in order to ensure that there are enough agricultural lands in which rice
cultivation and production may be carried into. The issuance of said Memorandum No. 88 was made pursuant to the general
welfare of the public, thus, it cannot be argued that it was made without any basis.

WHEREFORE, premises considered, the instant Petition for Certiorari is DISMISSED. Costs against petitioner.

SO ORDERED.

JOSE PORTUGAL PEREZ

Associate Justice
WE CONCUR:

RENATO C. CORONA
Chief Justice
Chairperson

PRESBITERO J. VELASCO, JR. TERESITA LEONARDO-DE CASTRO

Associate Justice Associate Justice

MARIANO C. DEL CASTILLO

Associate Justice

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, I hereby certify that the conclusions in the above Decision were reached
in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

RENATO C. CORONA
Chief Justice
G.R. No. 112526 October 12, 2001

STA. ROSA REALTY DEVELOPMENT CORPORATION, petitioner,

vs.
COURT OF APPEALS, JUAN B. AMANTE, FRANCISCO L. ANDAL, LUCIA ANDAL, ANDREA P. AYENDE, LETICIA P.
BALAT, FILOMENA B. BATINO, ANICETO A. BURGOS, JAIME A. BURGOS, FLORENCIA CANUBAS, LORETO A.
CANUBAS, MAXIMO A. CANUBAS, REYNALDO CARINGAL, QUIRINO C. CASALME, BENIGNO A. CRUZAT, ELINO A.
CRUZAT, GREGORIO F. CRUZAT, RUFINO C. CRUZAT, SERGIO CRUZAT, SEVERINO F. CRUZAT, VICTORIA DE
SAGUN, SEVERINO DE SAGUN, FELICISIMO A. GONZALES, FRANCISCO A. GONZALES, GREGORIO GONZALES,
LEODEGARIO N. GONZALES, PASCUAL P. GONZALES, ROLANDO A. GONZALES, FRANCISCO A. JUANGCO,
GERVACIO A. JUANGCO, LOURDES U. LUNA, ANSELMO M. MANDANAS, CRISANTO MANDANAS, EMILIO M.
MANDANAS, GREGORIO A. MANDANAS, MARIO G. MANDANAS, TEODORO MANDANAS, CONSTANCIO B.
MARQUEZ, EUGENIO B. MARQUEZ, ARMANDO P. MATIENZO, DANIEL D. MATIENZO, MAXIMINO MATIENZO,
PACENCIA P. MATIENZO, DOROTEA L. PANGANIBAN, JUANITO T. PEREZ, MARIANITO T. PEREZ, SEVERO M.
PEREZ, INOCENCIA S. PASQUIZA, BIENVENIDO F. PETATE, IGNACIO F. PETATE, JUANITO PETATE, PABLO A.
PLATON, PRECILLO V. PLATON, AQUILINO B. SUBOL, CASIANO T. VILLA, DOMINGO VILLA, JUAN T. VILLA, MARIO
C. VILLA, NATIVIDAD A. VILLA, JACINTA S. ALVARADO, RODOLFO ANGELES, DOMINGO A. CANUBAS, EDGARDO L.
CASALME, QUIRINO DE LEON, LEONILO M. ENRIQUEZ, CLAUDIA P. GONZALES, FELISA R. LANGUE, QUINTILLANO
LANGUE, REYNALDO LANGUE, ROMEO S. LANGUE, BONIFACIO VILLA, ROGELIO AYENDE, ANTONIO B.
FERNANDEZ, ZACARIAS HERRERA, ZACARIAS HERRERA, REYNARIO U. LAZO, AGAPITO MATIENZO, DIONISIO F.
PETATE, LITO G. REYES, JOSE M. SUBOL, CELESTINO G. TOPI NO, ROSA C. AMANTE, SOTERA CASALME, REMIGIO
M. SILVERIO, THE SECRETARY OF AGRARIAN REFORM, DEPARTMENT OF AGRARIAN REFORM ADJUDICATION
BOARD, LAND BANK OF THE PHILIPPINES, REGISTER OF DEEDS OF LAGUNA, DEPARTMENT OF ENVIRONMENT
AND NATURAL RESOURCES REGIONAL EXECUTIVE DIRECTOR FOR REGION IV, and REGIONAL AGRARIAN
REFORM OFFICER FOR REGION IV, respondents.

PARDO, J.:

The case before the Court is a petition for review on certiorari of the decision of the Court of Appeals 1 affirming the decision of
the Department of Agrarian Reform Adjudication Board2 (hereafter DARAB) ordering the compulsory acquisition of petitioner's
property under the Comprehensive Agrarian Reform Program (CARP).

Petitioner Sta. Rosa Realty Development Corporation (hereafter, SRRDC) was the registered owner of two parcels of land,
situated at Barangay Casile, Cabuyao, Laguna covered by TCT Nos. 81949 and 84891, with a total area of 254.6 hectares.
According to petitioner, the parcels of land are watersheds, which provide clean potable water to the Canlubang community,
and that ninety (90) light industries are now located in the area.3

Petitioner alleged that respondents usurped its rights over the property, thereby destroying the ecosystem. Sometime in
December 1985, respondents filed a civil case4 with the Regional Trial Court, Laguna, seeking an easement of a right of way to
and from Barangay Casile. By way of counterclaim, however, petitioner sought the ejectment of private respondents.

In October 1986 to August 1987, petitioner filed with the Municipal Trial Court, Cabuyao, Laguna separate complaints for
forcible entry against respondents.5

After the filing of the ejectment cases, respondents petitioned the Department of Agrarian Reform (DAR) for the compulsory
acquisition of the SRRDC property under the CARP.

On August 11, 1989, the Municipal Agrarian Reform Officer (MARO) of Cabuyao, Laguna issued a notice of coverage to
petitioner and invited its officials or representatives to a conference on August 18, 1989. 6 During the meeting, the following
were present: representatives of petitioner, the Land Bank of the Philippines, PARCCOM, PARO of Laguna, MARO of Laguna,
the BARC Chairman of Barangay Casile and some potential farmer beneficiaries, who are residents of Barangay Casile,
Cabuyao, Laguna. It was the consensus and recommendation of the assembly that the landholding of SRRDC be placed under
compulsory acquisition.

On August 17, 1989, petitioner filed with the Municipal Agrarian Reform Office (MARO), Cabuyao, Laguna a "Protest and
Objection" to the compulsory acquisition of the property on the ground that the area was not appropriate for agricultural
purposes. The area was rugged in terrain with slopes of 18% and above and that the occupants of the land were squatters,
who were not entitled to any land as beneficiaries.7

On August 29, 1989, the farmer beneficiaries together with the BARC chairman answered the protest and objection stating that
the slope of the land is not 18% but only 5-10% and that the land is suitable and economically viable for agricultural purposes,
as evidenced by the Certification of the Department of Agriculture, municipality of Cabuyao, Laguna.8

On September 8, 1989, MARO Belen dela Torre made a summary investigation report and forwarded the Compulsory
Acquisition Folder Indorsement (CAFI) to the Provincial Agrarian Reform Officer (hereafter, PARO). 9

On September 21, 1989, PARO Durante Ubeda forwarded his endorsement of the compulsory acquisition to the Secretary of
Agrarian Reform.
On November 23, 1989, Acting Director Eduardo C. Visperas of the Bureau of Land Acquisition and Development, DAR
forwarded two (2) Compulsory Acquisition Claim Folders covering the landholding of SRRDC, covered by TCT Nos. T-81949
and T-84891 to the President, Land Bank of the Philippines for further review and evaluation. 10

On December 12, 1989, Secretary of Agrarian Reform Miriam Defensor Santiago sent two (2) notices of acquisition11 to
petitioner, stating that petitioner's landholdings covered by TCT Nos. 81949 and 84891, containing an area of 188.2858 and
58.5800 hectares, valued at P4,417,735.65 and P1,220,229.93, respectively, had been placed under the Comprehensive
Agrarian Reform Program.

On February 6, 1990, petitioner SRRDC in two letters12 separately addressed to Secretary Florencio B. Abad and the Director,
Bureau of Land Acquisition and Distribution, sent its formal protest, protesting not only the amount of compensation offered by
DAR for the property but also the two (2) notices of acquisition.

On March 17, 1990, Secretary Abad referred the case to the DARAB for summary proceedings to determine just compensation
under R. A. No. 6657, Section 16.

On March 23, 1990, the LBP returned the two (2) claim folders previously referred for review and evaluation to the Director of
BLAD mentioning its inability to value the SRRDC landholding due to some deficiencies.

On March 28, 1990, Executive Director Emmanuel S. Galvez wrote Land Bank President Deogracias Vistan to forward the two
(2) claim folders involving the property of SRRDC to the DARAB for it to conduct summary proceedings to determine the just
compensation for the land.

On April 6, 1990, petitioner sent a letter to the Land Bank of the Philippines stating that its property under the aforesaid land
titles were exempt from CARP coverage because they had been classified as watershed area and were the subject of a
pending petition for land conversion.

On May 10, 1990, Director Narciso Villapando of BLAD turned over the two (2) claim folders (CACF's) to the Executive Director
of the DAR Adjudication Board for proper administrative valuation. Acting on the CACF's, on September 10, 1990, the Board
promulgated a resolution asking the office of the Secretary of Agrarian Reform (DAR) to first resolve two (2) issues before it
proceeds with the summary land valuation proceedings.13

The issues that need to be threshed out were as follows: (1) whether the subject parcels of land fall within the coverage of the
Compulsory Acquisition Program of the CARP; and (2) whether the petition for land conversion of the parcels of land may be
granted.

On December 7, 1990, the Office of the Secretary, DAR, through the Undersecretary for Operations (Assistant Secretary for
Luzon Operations) and the Regional Director of Region IV, submitted a report answering the two issues raised. According to
them, firstly, by virtue of the issuance of the notice of coverage on August 11, 1989, and notice of acquisition on December 12,
1989, the property is covered under compulsory acquisition. Secondly, Administrative Order No. 1, Series of 1990, Section IV D
also supports the DAR position on the coverage of the said property. During the consideration of the case by the Board, there
was no pending petition for land conversion specifically concerning the parcels of land in question.

On February 19, 1991, the Board sent a notice of hearing to all the parties interested, setting the hearing for the administrative
valuation of the subject parcels of land on March 6, 1991. However, on February 22, 1991, Atty. Ma. Elena P. Hernandez-
Cueva, counsel for SRRDC, wrote the Board requesting for its assistance in the reconstruction of the records of the case
because the records could not be found as her co-counsel, Atty. Ricardo Blancaflor, who originally handled the case for
SRRDC and had possession of all the records of the case was on indefinite leave and could not be contacted. The Board
granted counsel's request and moved the hearing to April 4, 1991.

On March 18, 1991, SRRDC submitted a petition to the Board for the latter to resolve SRRDC's petition for exemption from
CARP coverage before any administrative valuation of their landholding could be had by the Board.

On April 4, 1991, the initial DARAB hearing of the case was held and subsequently, different dates of hearing were set without
objection from counsel of SRRDC. During the April 15, 1991 hearing, the subdivision plan of subject property at Casile,
Cabuyao, Laguna was submitted and marked as Exhibit "5" for SRRDC. At the hearing on April 23, 1991, the Land Bank asked
for a period of one month to value the land in dispute.

At the hearing on April 23, 1991, certification from Deputy Zoning Administrator Generoso B. Opina was presented. The
certification issued on September 8, 1989, stated that the parcels of land subject of the case were classified as "industrial Park"
per Sanguniang Bayan Resolution No. 45-89 dated March 29, 1989.14

To avert any opportunity that the DARAB might distribute the lands to the farmer beneficiaries, on April 30, 1991, petitioner filed
a petition15 with DARAB to disqualify private respondents as beneficiaries. However, DARAB refused to address the issue of
beneficiaries.

In the meantime, on January 20, 1992, the Regional Trial Court, Laguna, Branch 24, rendered a decision, 16 finding that private
respondents illegally entered the SRRDC property, and ordered them evicted.
On July 11, 1991, DAR Secretary Benjamin T. Leong issued a memorandum directing the Land Bank of the Philippines to open
a trust account in favor of SRRDC, for P5,637,965.55, as valuation for the SRRDC property.

On December 19, 1991, DARAB promulgated a decision, the decretal portion of which reads:

"WHEREFORE, based on the foregoing premises, the Board hereby orders:

"1. The dismissal for lack of merit of the protest against the compulsory coverage of the landholdings of Sta. Rosa
Realty Development Corporation (Transfer Certificates of Title Nos. 81949 and 84891 with an area of 254.766
hectares) in Barangay Casile, Municipality of Cabuyao, Province of Laguna under the Comprehensive Agrarian
Reform Program is hereby affirmed;

"2. The Land Bank of the Philippines (LBP) to pay Sta. Rosa Realty Development Corporation the amount of Seven
Million Eight Hundred Forty-One Thousand, Nine Hundred Ninety Seven Pesos and Sixty-Four centavos
(P7,841,997.64) for its landholdings covered by the two (2) Transfer Certificates of Title mentioned above. Should
there be a rejection of the payment tendered, to open, if none has yet been made, a trust account for said amount in
the name of Sta. Rosa Realty Development Corporation;

"3. The Register of Deeds of the Province of Laguna to cancel with dispatch Transfer certificate of Title Nos. 84891
and 81949 and new one be issued in the name of the Republic of the Philippines, free from liens and encumbrances;

"4 The Department of Environment and Natural Resources either through its Provincial Office in Laguna or the
Regional Office, Region IV, to conduct a final segregation survey on the lands covered by Transfer certificate of Title
Nos. 84891 and 81949 so the same can be transferred by the Register of Deeds to the name of the Republic of the
Philippines;

"5. The Regional Office of the Department of Agrarian Reform through its Municipal and Provincial Agrarian Reform
Office to take immediate possession on the said landholding after Title shall have been transferred to the name of the
Republic of the Philippines, and distribute the same to the immediate issuance of Emancipation Patents to the
farmer-beneficiaries as determined by the Municipal Agrarian Reform Office of Cabuyao, Laguna." 17

On January 20, 1992, the Regional Trial Court, Laguna, Branch 24, rendered a decision in Civil Case No. B-233318ruling that
respondents were builders in bad faith.

On February 6, 1992, petitioner filed with the Court of Appeals a petition for review of the DARAB decision. 19 On November 5,
1993, the Court of Appeals promulgated a decision affirming the decision of DARAB. The decretal portion of the Court of
Appeals decision reads:

"WHEREFORE, premises considered, the DARAB decision dated September 19, 1991 is AFFIRMED, without
prejudice to petitioner Sta. Rosa Realty Development Corporation ventilating its case with the Special Agrarian Court
on the issue of just compensation."20Hence, this petition.21

On December 15, 1993, the Court issued a Resolution which reads:

"G. R. Nos. 112526 (Sta. Rosa Realty Development Corporation vs. Court of Appeals, et. al.) – Considering the
compliance, dated December 13, 1993, filed by counsel for petitioner, with the resolution of December 8, 1993 which
required petitioner to post a cash bond or surety bond in the amount of P1,500,000.00 Pesos before issuing a
temporary restraining order prayed for, manifesting that it has posted a CASH BOND in the same amount with the
Cashier of the Court as evidenced by the attached official receipt no. 315519, the Court resolved to ISSUE the
Temporary Retraining Order prayed for.

"The Court therefore, resolved to restrain: (a) the Department of Agrarian Reform Adjudication Board from enforcing
its decision dated December 19, 1991 in DARAB Case No. JC-R-IV-LAG-0001, which was affirmed by the Court of
Appeals in a Decision dated November 5, 1993, and which ordered, among others, the Regional Office of the
Department of Agrarian Reform through its Municipal and Provincial Reform Office to take immediate possession of
the landholding in dispute after title shall have been transferred to the name of the Republic of the Philippines and to
distribute the same through the immediate issuance of Emancipation Patents to the farmer-beneficiaries as
determined by the Municipal Agrarian Officer of Cabuyao, Laguna, (b) The Department of Agrarian Reform and/or the
Department of Agrarian Reform Adjudication Board, and all persons acting for and in their behalf and under their
authority from entering the properties involved in this case and from introducing permanent infrastructures thereon;
and (c) the private respondents from further clearing the said properties of their green cover by the cutting or burning
of trees and other vegetation, effective today until further orders from this Court." 22

The main issue raised is whether the property in question is covered by CARP despite the fact that the entire property formed
part of a watershed area prior to the enactment of R. A. No. 6657.
Under Republic Act No. 6657, there are two modes of acquisition of private land: compulsory and voluntary. In the case at bar,
the Department of Agrarian Reform sought the compulsory acquisition of subject property under R. A. No. 6657, Section 16, to
wit:

"Sec. 16. Procedure for Acquisition of Private Lands. – For purposes of acquisition of private lands, the following
procedures shall be followed:

a.) After having identified the land, the landowners and the beneficiaries, the DAR shall send its notice to
acquire the land to the owners thereof, by personal delivery or registered mail, and post the same in a
conspicuous place in the municipal building and barangay hall of the place where the property is located.
Said notice shall contain the offer of the DAR to pay corresponding value in accordance with the valuation
set forth in Sections 17, 18, and other pertinent provisions hereof.

b.) Within thirty (30) days from the date of the receipt of written notice by personal delivery or registered
mail, the landowner, his administrator or representative shall inform the DAR of his acceptance or rejection
of the offer.

c.) If the landowner accepts the offer of the DAR, the LBP shall pay the landowner the purchase price of
the land within thirty (30) days after he executes and delivers a deed of transfer in favor of the government
and other muniments of title.

d.) In case of rejection or failure to reply, the DAR shall conduct summary administrative proceedings to
determine the compensation for the land requiring the landowner, the LBP and other interested parties to
submit fifteen (15) days from receipt of the notice. After the expiration of the above period, the matter is
deemed submitted for decision. The DAR shall decide the case within thirty (30) days after it is submitted
for decision.

e.) Upon receipt by the landowner of the corresponding payment, or, in case of rejection or no response
from the landowner, upon the deposit with an accessible bank designated by the DAR of the compensation
in cash or in LBP bonds in accordance with this act, the DAR shall make immediate possession of the land
and shall request the proper Register of Deeds to issue Transfer Certificate of Titles (TCT) in the name of
the Republic of the Philippines. The DAR shall thereafter proceed with the redistribution of the land to the
qualified beneficiaries.

f.) Any party who disagrees with the decision may bring the matter to the court23 of proper jurisdiction for
final determination of just compensation.

In compulsory acquisition of private lands, the landholding, the landowners and farmer beneficiaries must first be identified.
After identification, the DAR shall send a notice of acquisition to the landowner, by personal delivery or registered mail, and
post it in a conspicuous place in the municipal building and barangay hall of the place where the property is located.

Within thirty (30) days from receipt of the notice of acquisition, the landowner, his administrator or representative shall inform
the DAR of his acceptance or rejection of the offer.

If the landowner accepts, he executes and delivers a deed of transfer in favor of the government and surrenders the certificate
of title. Within thirty (30) days from the execution of the deed of transfer, the Land Bank of the Philippines (LBP) pays the owner
the purchase price. If the landowner accepts, he executes and delivers a deed of transfer in favor of the government and
surrenders the certificate of title. Within thirty days from the execution of the deed of transfer, the Land Bank of the Philippines
(LBP) pays the owner the purchase price. If the landowner rejects the DAR's offer or fails to make a reply, the DAR conducts
summary administrative proceedings to determine just compensation for the land. The landowner, the LBP representative and
other interested parties may submit evidence on just compensation within fifteen days from notice. Within thirty days from
submission, the DAR shall decide the case and inform the owner of its decision and the amount of just compensation.

Upon receipt by the owner of the corresponding payment, or, in case of rejection or lack of response from the latter, the DAR
shall deposit the compensation in cash or in LBP bonds with an accessible bank. The DAR shall immediately take possession
of the land and cause the issuance of a transfer certificate of title in the name of the Republic of the Philippines. The land shall
then be redistributed to the farmer beneficiaries. Any party may question the decision of the DAR in the special agrarian courts
(provisionally the Supreme Court designated branches of the regional trial court as special agrarian courts) for final
determination of just compensation.

The DAR has made compulsory acquisition the priority mode of land acquisition to hasten the implementation of the
Comprehensive Agrarian Reform Program (CARP). Under Sec. 16 of the CARL, the first step in compulsory acquisition is the
identification of the land, the landowners and the farmer beneficiaries. However, the law is silent on how the identification
process shall be made. To fill this gap, on July 26, 1989, the DAR issued Administrative Order No. 12, series of 1989, which set
the operating procedure in the identification of such lands. The procedure is as follows:

A. The Municipal Agrarian Reform Officer (MARO), with the assistance of the pertinent Barangay Agrarian Reform
Committee (BARC), shall:
1. Update the masterlist of all agricultural lands covered under the CARP in his area of responsibility; the masterlist
should include such information as required under the attached CARP masterlist form which shall include the name
of the landowner, landholding area, TCT/OCT number, and tax declaration number.

2. Prepare the Compulsory Acquisition Case Folder (CACF) for each title (OCT/TCT) or landholding covered under
Phase I and II of the CARP except those for which the landowners have already filed applications to avail of other
modes of land acquisition. A case folder shall contain the following duly accomplished forms:

a) CARP CA Form 1—MARO investigation report

b) CARP CA Form No 2 – Summary investigation report findings and evaluation

c) CARP CA Form 3—Applicant's Information sheet

d) CARP CA Form 4 – Beneficiaries undertaking

e) CARP CA Form 5 – Transmittal report to the PARO

The MARO/BARC shall certify that all information contained in the above-mentioned forms have been examined and
verified by him and that the same are true and correct.

3. Send notice of coverage and a letter of invitation to a conference/meeting to the landowner covered by the
Compulsory Case Acquisition Folder. Invitations to the said conference meeting shall also be sent to the prospective
farmer-beneficiaries, the BARC representatives, the Land Bank of the Philippines (LBP) representative, and the other
interested parties to discuss the inputs to the valuation of the property.

He shall discuss the MARO/BARC investigation report and solicit the views, objection, agreements or suggestions of
the participants thereon. The landowner shall also ask to indicate his retention area. The minutes of the meeting shall
be signed by all participants in the conference and shall form an integral part of the CACF.

4. Submit all completed case folders to the Provincial Agrarian Reform Officer (PARO).

B. The PARO shall:

1. Ensure the individual case folders are forwarded to him by his MAROs.

2. Immediately upon receipt of a case folder, compute the valuation of the land in accordance with A.O. No. 6, series
of 1988. The valuation worksheet and the related CACF valuation forms shall be duly certified correct by the PARO
and all the personnel who participated in the accomplishment of these forms.

3. In all cases, the PARO may validate the report of the MARO through ocular inspection and verification of the
property. This ocular inspection and verification shall be mandatory when the computed value exceeds P500,000 per
estate.

4. Upon determination of the valuation, forward the case folder, together with the duly accomplished valuation forms
and his recommendations, to the Central Office.

The LBP representative and the MARO concerned shall be furnished a copy each of his report.

C. DAR Central Office, specifically through the Bureau of Land Acquisition and Distribution (BLAD), shall:

1. Within three days from receipt of the case folder from the PARO, review, evaluate and determine the final land
valuation of the property covered by the case folder. A summary review and evaluation report shall be prepared and
duly certified by the BLAD Director and the personnel directly participating in the review and final valuation.

2. Prepare, for the signature of the Secretary or her duly authorized representative, a notice of acquisition (CARP
Form 8) for the subject property. Serve the notice to the landowner personally or through registered mail within three
days from its approval. The notice shall include among others, the area subject of compulsory acquisition, and the
amount of just compensation offered by DAR.

3. Should the landowner accept the DAR's offered value, the BLAD shall prepare and submit to the Secretary for
approval the order of acquisition. However, in case of rejection or non-reply, the DAR Adjudication Board (DARAB)
shall conduct a summary administrative hearing to determine just compensation, in accordance with the procedures
provided under Administrative Order No. 13, series of 1989. Immediately upon receipt of the DARAB's decision on
just compensation, the BLAD shall prepare and submit to the Secretary for approval the required order of acquisition.
 4. Upon the landowner's receipt of payment, in case of acceptance, or upon deposit of payment in the designated
bank, in case of rejection or non-response, the Secretary shall immediately direct the pertinent Register of Deeds to
issue the corresponding Transfer Certificate of Title (TCT) in the name of the Republic of the Philippines. Once the
property is transferred, the DAR, through the PARO, shall take possession of the land for redistribution to qualified
beneficiaries."

Administrative Order No. 12, Series of 1989 requires that the Municipal Agrarian Reform Officer (MARO) keep an updated
master list of all agricultural lands under the CARP in his area of responsibility containing all the required information. The
MARO prepares a Compulsory Acquisition Case Folder (CACF) for each title covered by CARP. The MARO then sends the
landowner a "Notice of Coverage" and a "letter of invitation" to a "conference/ meeting" over the land covered by the CACF. He
also sends invitations to the prospective farmer-beneficiaries, the representatives of the Barangay Agrarian Reform Committee
(BARC), the Land Bank of the Philippines (LBP) and other interested parties to discuss the inputs to the valuation of the
property and solicit views, suggestions, objections or agreements of the parties. At the meeting, the landowner is asked to
indicate his retention area.

The MARO shall make a report of the case to the Provincial Agrarian Reform Officer (PARO) who shall complete the valuation
of the land. Ocular inspection and verification of the property by the PARO shall be mandatory when the computed value of the
estate exceeds P500,000.00. Upon determination of the valuation, the PARO shall forward all papers together with his
recommendation to the Central Office of the DAR. The DAR Central Office, specifically, the Bureau of Land Acquisition and
Distribution (BLAD) shall prepare, on the signature of the Secretary or his duly authorized representative, a notice of acquisition
of the subject property. From this point, the provisions of R. A. No. 6657, Section 16 shall apply.

For a valid implementation of the CARP Program, two notices are required: (1) the notice of coverage and letter of invitation to
a preliminary conference sent to the landowner, the representative of the BARC, LBP, farmer beneficiaries and other interested
parties pursuant to DAR A. O. No. 12, series of 1989; and (2) the notice of acquisition sent to the landowner under Section 16
of the CARL.

The importance of the first notice, that is, the notice of coverage and the letter of invitation to a conference, and its actual
conduct cannot be understated. They are steps designed to comply with the requirements of administrative due process. The
implementation of the CARL is an exercise of the State's police power and the power of eminent domain. To the extent that the
CARL prescribes retention limits to the landowners, there is an exercise of police power for the regulation of private property in
accordance with the Constitution. But where, to carry out such regulation, the owners are deprived of lands they own in excess
of the maximum area allowed, there is also a taking under the power of eminent domain. The taking contemplated is not mere
limitation of the use of the land. What is required is the surrender of the title to and physical possession of the excess and all
beneficial rights accruing to the owner in favor of the farmer beneficiary.

In the case at bar, DAR has executed the taking of the property in question. However, payment of just compensation was not in
accordance with the procedural requirement. The law required payment in cash or LBP bonds, not by trust account as was
done by DAR.

In Association of Small Landowners in the Philippines v. Secretary of Agrarian Reform, we held that "The CARP Law, for its
part, conditions the transfer of possession and ownership of the land to the government on receipt of the landowner of the
corresponding payment or the deposit by the DAR of the compensation in cash or LBP bonds with an accessible bank. Until
then, title also remains with the landowner. No outright change of ownership is contemplated either." 24

Consequently, petitioner questioned before the Court of Appeals DARAB's decision ordering the compulsory acquisition of
petitioner's property.25 Here, petitioner pressed the question of whether the property was a watershed, not covered by CARP.

Article 67 of the Water Code of the Philippines (P. D. No. 1067) provides:

"Art. 67. Any watershed or any area of land adjacent to any surface water or overlying any ground water may be
declared by the Department of Natural resources as a protected area. Rules and Regulations may be promulgated by
such Department to prohibit or control such activities by the owners or occupants thereof within the protected area
which may damage or cause the deterioration of the surface water or ground water or interfere with the investigation,
use, control, protection, management or administration of such waters."

Watersheds may be defined as "an area drained by a river and its tributaries and enclosed by a boundary or divide which
separates it from adjacent watersheds." Watersheds generally are outside the commerce of man, so why was the Casile
property titled in the name of SRRDC? The answer is simple. At the time of the titling, the Department of Agriculture and
Natural Resources had not declared the property as watershed area. The parcels of land in Barangay Casile were declared as
"PARK" by a Zoning Ordinance adopted by the municipality of Cabuyao in 1979, as certified by the Housing and Land Use
Regulatory Board. On January 5, 1994, the Sangguniang Bayan of Cabuyao, Laguna issued a Resolution 26 voiding the zoning
classification of the land at Barangay Casile as Park and declaring that the land is now classified as agricultural land.

The authority of the municipality of Cabuyao, Laguna to issue zoning classification is an exercise of its police power, not the
power of eminent domain. "A zoning ordinance is defined as a local city or municipal legislation which logically arranges,
prescribes, defines and apportions a given political subdivision into specific land uses as present and future projection of
needs."27
In Natalia Realty, Inc. v. Department of Agrarian Reform28 we held that lands classified as non-agricultural prior to the effectivity
of the CARL may not be compulsorily acquired for distribution to farmer beneficiaries.

However, more than the classification of the subject land as PARK is the fact that subsequent studies and survey showed that
the parcels of land in question form a vital part of a watershed area.29

Now, petitioner has offered to prove that the land in dispute is a "watershed or part of the protected area for watershed
purposes." Ecological balances and environmental disasters in our day and age seem to be interconnected. Property
developers and tillers of the land must be aware of this deadly combination. In the case at bar, DAR included the disputed
parcels of land for compulsory acquisition simply because the land was allegedly devoted to agriculture and was titled to
SRRDC, hence, private and alienable land that may be subject to CARP.

However, the scenario has changed, after an in-depth study, survey and reassessment. We cannot ignore the fact that the
disputed parcels of land form a vital part of an area that need to be protected for watershed purposes. In a report of the
Ecosystems Research and Development Bureau (ERDB), a research arm of the DENR, regarding the environmental
assessment of the Casile and Kabanga-an river watersheds, they concluded that:

"The Casile barangay covered by CLOA in question is situated in the heartland of both watersheds. Considering the
barangays proximity to the Matangtubig waterworks, the activities of the farmers which are in conflict with proper soil
and water conservation practices jeopardize and endanger the vital waterworks. Degradation of the land would have
double edge detrimental effects. On the Casile side this would mean direct siltation of the Mangumit river which
drains to the water impounding reservoir below. On the Kabanga-an side, this would mean destruction of forest
covers which acts as recharged areas of the Matang Tubig springs. Considering that the people have little if no direct
interest in the protection of the Matang Tubig structures they couldn't care less even if it would be destroyed.

The Casile and Kabanga-an watersheds can be considered a most vital life support system to thousands of
inhabitants directly and indirectly affected by it. From these watersheds come the natural God-given precious
resource – water. x x x x x

Clearing and tilling of the lands are totally inconsistent with sound watershed management. More so, the introduction
of earth disturbing activities like road building and erection of permanent infrastructures. Unless the pernicious
agricultural activities of the Casile farmers are immediately stopped, it would not be long before these watersheds
would cease to be of value. The impact of watershed degredation threatens the livelihood of thousands of people
dependent upon it. Toward this, we hope that an acceptable comprehensive watershed development policy and
program be immediately formulated and implemented before the irreversible damage finally happens.

Hence, the following are recommended:

7.2 The Casile farmers should be relocated and given financial assistance.

7.3 Declaration of the two watersheds as critical and in need of immediate rehabilitation.

7.4 A comprehensive and detailed watershed management plan and program be formulated and
implemented by the Canlubang Estate in coordination with pertinent government agencies." 30

The ERDB report was prepared by a composite team headed by Dr. Emilio Rosario, the ERDB Director, who holds a doctorate
degree in water resources from U.P. Los Banos in 1987; Dr. Medel Limsuan, who obtained his doctorate degree in watershed
management from Colorado University (US) in 1989; and Dr. Antonio M. Dano, who obtained his doctorate degree in Soil and
Water management Conservation from U.P. Los Banos in 1993.

Also, DENR Secretary Angel Alcala submitted a Memorandum for the President dated September 7, 1993 (Subject: PFVR HWI
Ref.: 933103 Presidential Instructions on the Protection of Watersheds of the Canlubang Estates at Barrio Casile, Cabuyao,
Laguna) which reads:

"It is the opinion of this office that the area in question must be maintained for watershed purposes for ecological and
environmental considerations, among others. Although the 88 families who are the proposed CARP beneficiaries will
be affected, it is important that a larger view of the situation be taken as one should also consider the adverse effect
on thousands of residents downstream if the watershed will not be protected and maintained for watershed purposes.

"The foregoing considered, it is recommended that if possible, an alternate area be allocated for the affected farmers,
and that the Canlubang Estates be mandated to protect and maintain the area in question as a permanent watershed
reserved."31

The definition does not exactly depict the complexities of a watershed. The most important product of a watershed is water
which is one of the most important human necessity. The protection of watersheds ensures an adequate supply of water for
future generations and the control of flashfloods that not only damage property but cause loss of lives. Protection of watersheds
is an "intergenerational responsibility" that needs to be answered now.
Another factor that needs to be mentioned is the fact that during the DARAB hearing, petitioner presented proof that the Casile
property has slopes of 18% and over, which exempted the land from the coverage of CARL. R. A. No. 6657, Section 10,
provides:

"Section 10. Exemptions and Exclusions. – Lands actually, directly and exclusively used and found to be necessary
for parks, wildlife, forest reserves, reforestration, fish sanctuaries and breeding grounds, watersheds and mangroves,
national defense, school sites and campuses including experimental farm stations operated by public or private
schools for educational purposes, seeds and seedlings research and pilot production centers, church sites and
convents appurtenent thereto, communal burial grounds and cemeteries, penal colonies and penal farms actually
worked by the inmates, government and private research and quarantine centers, and all lands with eighteen percent
(18%) slope and over, except those already developed shall be exempt from coverage of this Act."

Hence, during the hearing at DARAB, there was proof showing that the disputed parcels of land may be excluded from the
compulsory acquisition coverage of CARP because of its very high slopes.

To resolve the issue as to the true nature of the parcels of land involved in the case at bar, the Court directs the DARAB to
conduct a re-evaluation of the issue.

IN VIEW WHEREOF, the Court SETS ASIDE the decision of the Court of Appeals in CA-G. R. SP No. 27234.

In lieu thereof, the Court REMANDS the case to the DARAB for re-evaluation and determination of the nature of the parcels of
land involved to resolve the issue of its coverage by the Comprehensive Land Reform Program.

In the meantime, the effects of the CLOAs issued by the DAR to supposed farmer beneficiaries shall continue to be stayed by
the temporary restraining order issued on December 15, 1993, which shall remain in effect until final decision on the case.

No costs.

SO ORDERED.

Davide, Jr., C.J., (Chairman), and Ynares-Santiago, JJ., concur.

Puno, J., no part due to relationship.
Kapunan, J., on official leave.
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.

DECISION

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 Balamban’s land use plan and adopted en toto Balamban’s 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 2022 23 of 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 DAR’s 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 DAR’s 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 department’s 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
law’s effectivity on June 15, 1988. This conclusion is based on a liberal interpretation of R.A. No. 6657 in the light of DAR’s
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 provides 26 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.
 MINITA V. CHICO-NAZARIO

Associate Justice

WE CONCUR:

REYNATO S. PUNO

Associate Justice

Chairman

MA. ALICIA AUSTRIA-MARTINEZ ROMEO J. CALLEJO, SR.

Associate Justice Associate Justice

DANTE O. TINGA

Associate Justice
ATTESTATION

I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of
the opinion of the Court’s Division.

REYNATO S. PUNO

Associate Justice

Chairman, Second Division

CERTIFICATION

Pursuant to Article VIII, Section 13 of the Constitution, and the Division Chairman’s Attestation, it is hereby certified that the
conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the
Court’s Division.

HILARIO G. DAVIDE, JR.

Chief Justice
[G.R. No. 131457. April 24, 1998]

HON. CARLOS O. FORTICH, PROVINCIAL GOVERNOR OF BUKIDNON, HON. REY B. BAULA, MUNICIPAL MAYOR OF
SUMILAO, BUKIDNON, NQSR MANAGEMENT AND DEVELOPMENT CORPORATION, petitioners, vs. HON.
RENATO C. CORONA, DEPUTY EXECUTIVE SECRETARY, HON. ERNESTO D. GARILAO, SECRETARY OF
THE DEPARTMENT OF AGRARIAN REFORM, respondents.

DECISION

MARTINEZ, J.:

The dramatic and well-publicized hunger strike staged by some alleged farmer-beneficiaries in front of the Department of
Agrarian Reform compound in Quezon City on October 9, 1997 commanded nationwide attention that even church leaders and
some presidential candidates tried to intervene for the strikers cause.

The strikers protested the March 29, 1996 Decision[1] of the Office of the President (OP), issued through then Executive
Secretary Ruben D. Torres in OP Case No. 96-C-6424, which approved the conversion of a one hundred forty-four (144)-
hectare land from agricultural to agro-industrial/institutional area. This led the Office of the President, through then Deputy
Executive Secretary Renato C. Corona, to issue the so-called Win-Win Resolution[2] on November 7, 1997,
substantially modifying its earlier Decision after it had already become final and executory. The said Resolution modified
the approval of the land conversion to agro-industrial area only to the extent of forty-four (44) hectares, and ordered the
remaining one hundred (100) hectares to be distributed to qualified farmer-beneficiaries.

But, did the Win-Win Resolution culminate in victory for all the contending parties?

The above-named petitioners cried foul. They have come to this Court urging us to annul and set aside the Win-Win
Resolution and to enjoin respondent Secretary Ernesto D. Garilao of the Department of Agrarian Reform from implementing the
said Resolution.

Thus, the crucial issue to be resolved in this case is: What is the legal effect of the Win-Win Resolution issued by the
Office of the President on its earlier Decision involving the same subject matter, which had already become final and
executory?

The antecedent facts of this controversy, as culled from the pleadings, may be stated as follows:

1. This case involves a 144-hectare land located at San Vicente, Sumilao, Bukidnon, owned by the Norberto Quisumbing,
Sr. Management and Development Corporation (NQSRMDC), one of the petitioners. The property is covered by a Transfer
Certificate of Title No. 14371[3] of the Registry of Deeds of the Province of Bukidnon.

2. In 1984, the land was leased as a pineapple plantation to the Philippine Packing Corporation, now Del Monte
Philippines, Inc. (DMPI), a multinational corporation, for a period of ten (10) years under the Crop Producer and Growers
Agreement duly annotated in the certificate of title. The lease expired in April, 1994.

3. In October, 1991, during the existence of the lease, the Department of Agrarian Reform (DAR) placed the entire 144-
hectare property under compulsory acquisition and assessed the land value at P2.38 million.[4]

4. NQSRMDC resisted the DARs action. In February, 1992, it sought and was granted by the DAR Adjudication Board
(DARAB), through its Provincial Agrarian Reform Adjudicator (PARAD) in DARAB Case No. X-576, a writ of prohibition with
preliminary injunction which ordered the DAR Region X Director, the Provincial Agrarian Reform Officer (PARO) of Bukidnon,
the Municipal Agrarian Reform Office (MARO) of Sumilao, Bukidnon, the Land Bank of the Philippines (Land Bank), and their
authorized representatives to desist from pursuing any activity or activities concerning the subject land until further orders.[5]

5. Despite the DARAB order of March 31, 1992, the DAR Regional Director issued a memorandum, dated May 21, 1992,
directing the Land Bank to open a trust account for P2.38 million in the name of NQSRMDC and to conduct summary
proceedings to determine the just compensation of the subject property. NQSRMDC objected to these moves and filed on June
9, 1992 an Omnibus Motion to enforce the DARAB order of March 31, 1992 and to nullify the summary proceedings undertaken
by the DAR Regional Director and Land Bank on the valuation of the subject property.

6. The DARAB, on October 22, 1992, acted favorably on the Omnibus Motion by (a) ordering the DAR Regional Director
and Land Bank to seriously comply with the terms of the order dated March 31, 1992; (b) nullifying the DAR Regional Directors
memorandum, dated May 21, 1992, and the summary proceedings conducted pursuant thereto; and (c) directing the Land
Bank to return the claim folder of Petitioner NQSRMDCs subject property to the DAR until further orders. [6]

7. The Land Bank complied with the DARAB order and cancelled the trust account it opened in the name of petitioner
NQSRMDC.[7]

8. In the meantime, the Provincial Development Council (PDC) of Bukidnon, headed by Governor Carlos O. Fortich,
passed Resolution No. 6,[8] dated January 7, 1993, designating certain areas along Bukidnon-Sayre Highway as part of the
Bukidnon Agro-Industrial Zones where the subject property is situated.

9. What happened thereafter is well-narrated in the OP (TORRES) Decision of March 29, 1996, pertinent portions of
which we quote:

Pursuant to Section 20 of R.A. No. 7160, otherwise known as the Local Government Code, the Sangguniang Bayan of
Sumilao, Bukidnon, on March 4, 1993, enacted Ordinance No. 24 converting or re-classifying 144 hectares of land in Bgy. San
Vicente, said Municipality, from agricultural to industrial/institutional with a view of providing an opportunity to attract investors
who can inject new economic vitality, provide more jobs and raise the income of its people.
Parenthetically, under said section, 4th to 5th class municipalities may authorize the classification of five percent (5%) of their
agricultural land area and provide for the manner of their utilization or disposition.

On 12 October 1993, the Bukidnon Provincial Land Use Committee approved the said Ordinance. Accordingly, on 11
December 1993, the instant application for conversion was filed by Mr. Gaudencio Beduya in behalf of NQSRMDC/BAIDA
(Bukidnon Agro-Industrial Development Association).

Expressing support for the proposed project, the Bukidnon Provincial Board, on the basis of a Joint Committee Report
submitted by its Committee on Laws, Committee on Agrarian Reform and Socio-Economic Committee approved, on 1 February
1994, the said Ordinance now docketed as Resolution No. 94-95. The said industrial area, as conceived by NQSRMDC (project
proponent) is supposed to have the following components:

1. The Development Academy of Mindanao which constitutes the following: Institute for Continuing Higher Education; Institute
for Livelihood Science (Vocational and Technical School); Institute for Agribusiness Research; Museum, Library, Cultural
Center, and Mindanao Sports Development Complex which covers an area of 24 hectares;

2. Bukidnon Agro-Industrial Park which consists of corn processing for corn oil, corn starch, various corn products; rice
processing for wine, rice-based snacks, exportable rice; cassava processing for starch, alcohol and food delicacies; processing
plants, fruits and fruit products such as juices; processing plants for vegetables processed and prepared for market; cold
storage and ice plant; cannery system; commercial stores; public market; and abattoir needing about 67 hectares;

3. Forest development which includes open spaces and parks for recreation, horse-back riding, memorial and mini-zoo
estimated to cover 33 hectares; and

4. Support facilities which comprise the construction of a 360-room hotel, restaurants, dormitories and a housing project
covering an area of 20 hectares.

The said NQSRMDC Proposal was, per Certification dated January 4, 1995, adopted by the Department of Trade and Industry,
Bukidnon Provincial Office, as one of its flagship projects.The same was likewise favorably recommended by the Provincial
Development Council of Bukidnon; the municipal, provincial and regional office of the DAR; the Regional Office (Region X) of
the DENR (which issued an Environmental Compliance Certificate on June 5, 1995); the Executive Director, signing By
Authority of PAUL G. DOMINGUEZ, Office of the President Mindanao; the Secretary of DILG; and Undersecretary of DECS
Wilfredo D. Clemente.

In the same vein, the National Irrigation Administration, Provincial Irrigation Office, Bagontaas Valencia, Bukidnon, thru Mr.
Julius S. Maquiling, Chief, Provincial Irrigation Office, interposed NO OBJECTION to the proposed conversion as long as the
development cost of the irrigation systems thereat which is P2,377.00 per hectare be replenished by the developer x x x. Also,
the Kisolon-San Vicente Irrigators Multi Purpose Cooperative, San Vicente, Sumilao, Bukidnon, interposed no objection to the
proposed conversion of the land in question as it will provide more economic benefits to the community in terms of outside
investments that will come and employment opportunities that will be generated by the projects to be put up x x x.

On the same score, it is represented that during the public consultation held at the Kisolan Elementary School on 18 March
1995 with Director Jose Macalindong of DAR Central Office and DECS Undersecretary Clemente, the people of the affected
barangay rallied behind their respective officials in endorsing the project.

Notwithstanding the foregoing favorable recommendation, however, on November 14, 1994, the DAR, thru Secretary Garilao,
invoking its powers to approve conversion of lands under Section 65 of R.A. No. 6657, issued an Order denying the instant
application for the conversion of the subject land from agricultural to agro-industrial and, instead, placed the same under the
compulsory coverage of CARP and directed the distribution thereof to all qualified beneficiaries on the following grounds:

1. The area is considered as a prime agricultural land with irrigation facility;

2. The land has long been covered by a Notice of Compulsory Acquisition (NCA);

3. The existing policy on withdrawal or lifting on areas covered by NCA is not applicable;

4. There is no clear and tangible compensation package arrangements for the beneficiaries;

5. The procedures on how the area was identified and reclassified for agro-industrial project has no reference to Memo Circular
No. 54, Series of 1993, E.O. No. 72, Series of 1993, and E.O. No. 124, Series of 1993.

A Motion for Reconsideration of the aforesaid Order was filed on January 9, 1995 by applicant but the same was denied (in an
Order dated June 7, 1995).[9]

10. Thus, the DAR Secretary ordered the DAR Regional Director to proceed with the compulsory acquisition and
distribution of the property.[10]
 11. Governor Carlos O. Fortich of Bukidnon appealed[11] the order of denial to the Office of the President and prayed for
the conversion/reclassification of the subject land as the same would be more beneficial to the people of Bukidnon.

12. To prevent the enforcement of the DAR Secretarys order, NQSRMDC, on June 29, 1995, filed with the Court of
Appeals a petition for certiorari, prohibition with preliminary injunction,[12] docketed as CA-G.R. SP No. 37614.

13. Meanwhile, on July 25, 1995, the Honorable Paul G. Dominguez, then Presidential Assistant for Mindanao, after
conducting an evaluation of the proposed project, sent a memorandum[13] to the President favorably endorsing the project with
a recommendation that the DAR Secretary reconsider his decision in denying the application of the province for the conversion
of the land.

14. Also, in a memorandum[14] to the President dated August 23, 1995, the Honorable Rafael Alunan III, then Secretary of
the Department of the Interior and Local Government (DILG), recommended the conversion of the subject land to
industrial/institutional use with a request that the President hold the implementation of the DAR order to distribute the land in
question.

15. On October 23, 1995, the Court of Appeals, in CA-G.R. SP No. 37614, issued a Resolution[15] ordering the parties to
observe status quo pending resolution of the petition. At the hearing held in said case on October 5, 1995, the DAR, through
the Solicitor General, manifested before the said court that the DAR was merely in the processing stage of the applications of
farmers-claimants and has agreed to respect status quo pending the resolution of the petition. [16]

16. In resolving the appeal, the Office of the President, through then Executive Secretary Ruben D. Torres, issued a
Decision in OP Case No. 96-C-6424, dated March 29, 1996, reversing the DAR Secretarys decision, the pertinent portions of
which read:

After a careful evaluation of the petition vis--vis the grounds upon which the denial thereof by Secretary Garilao was based, we
find that the instant application for conversion by the Municipality of Sumilao, Bukidnon is impressed with merit. To be sure,
converting the land in question from agricultural to agro-industrial would open great opportunities for employment and bring
about real development in the area towards a sustained economic growth of the municipality. On the other hand, distributing
the land to would-be beneficiaries (who are not even tenants, as there are none) does not guarantee such benefits.

Nevertheless, on the issue that the land is considered a prime agricultural land with irrigation facility it maybe appropriate to
mention that, as claimed by petitioner, while it is true that there is, indeed, an irrigation facility in the area, the same merely
passes thru the property (as a right of way) to provide water to the ricelands located on the lower portion thereof. The land
itself, subject of the instant petition, is not irrigated as the same was, for several years, planted with pineapple by the Philippine
Packing Corporation.

On the issue that the land has long been covered by a Notice of Compulsory Acquisition (NCA) and that the existing policy on
withdrawal or lifting on areas covered by NCA is not applicable, suffice it to state that the said NCA was declared null and void
by the Department of Agrarian Reform Adjudication Board (DARAB) as early as March 1, 1992. Deciding in favor of
NQSRMDC, the DARAB correctly pointed out that under Section 8 of R.A. No. 6657, the subject property could not validly be
the subject of compulsory acquisition until after the expiration of the lease contract with Del Monte Philippines, a Multi-National
Company, or until April 1994, and ordered the DAR Regional Office and the Land Bank of the Philippines, both in Butuan City,
to `desist from pursuing any activity or activities covering petitioners land.

On this score, we take special notice of the fact that the Quisumbing family has already contributed substantially to the land
reform program of the government, as follows: 300 hectares of rice land in Nueva Ecija in the 70s and another 400 hectares in
the nearby Municipality of Impasugong, Bukidnon, ten (10) years ago, for which they have not received just compensation up to
this time.

Neither can the assertion that there is no clear and tangible compensation package arrangements for the beneficiaries hold
water as, in the first place, there are no beneficiaries to speak about, for the land is not tenanted as already stated.

Nor can procedural lapses in the manner of identifying/reclassifying the subject property for agro-industrial purposes be allowed
to defeat the very purpose of the law granting autonomy to local government units in the management of their local
affairs. Stated more simply, the language of Section 20 of R.A. No. 7160, supra, is clear and affords no room for any other
interpretation. By unequivocal legal mandate, it grants local government units autonomy in their local affairs including the power
to convert portions of their agricultural lands and provide for the manner of their utilization and disposition to enable them to
attain their fullest development as self-reliant communities.

WHEREFORE, in pursuance of the spirit and intent of the said legal mandate and in view of the favorable recommendations of
the various government agencies abovementioned, the subject Order, dated November 14, 1994 of the Hon. Secretary,
Department of Agrarian Reform, is hereby SET ASIDE and the instant application of NQSRMDC/BAIDA is hereby
APPROVED.[17]

17.On May 20, 1996, DAR filed a motion for reconsideration of the OP decision.

18 On September 11, 1996, in compliance with the OP decision of March 29, 1996, NQSRMDC and the Department of
Education, Culture and Sports (DECS) executed a Memorandum of Agreement whereby the former donated four (4) hectares
from the subject land to DECS for the establishment of the NQSR High School. [18]

When NQSRMDC was about to transfer the title over the 4-hectare donated to DECS, it discovered that the title over the
subject property was no longer in its name. It soon found out that during the pendency of both the Petition for Certiorari,
Prohibition, with Preliminary Injunction it filed against DAR in the Court of Appeals and the appeal to the President filed by
Governor Carlos O. Fortich, the DAR, without giving just compensation, caused the cancellation of NQSRMDCs title on August
11, 1995 and had it transferred in the name of the Republic of the Philippines under TCT No. T-50264[19] of the Registry of
Deeds of Bukidnon. Thereafter, on September 25, 1995, DAR caused the issuance of Certificates of Land Ownership Award
(CLOA) No. 00240227 and had it registered in the name of 137 farmer-beneficiaries under TCT No. AT-3536[20] of the Registry
of Deeds of Bukidnon.

19. Thus, on April 10, 1997, NQSRMDC filed a complaint[21] with the Regional Trial Court (RTC) of Malaybalay, Bukidnon
(Branch 9), docketed as Civil Case No. 2687-97, for annulment and cancellation of title, damages and injunction against DAR
and 141 others. The RTC then issued a Temporary Restraining Order on April 30, 1997[22] and a Writ of Preliminary Injunction
on May 19, 1997,[23] restraining the DAR and 141 others from entering, occupying and/or wresting from NQSRMDC the
possession of the subject land.

20. Meanwhile, on June 23, 1997, an Order[24] was issued by then Executive Secretary Ruben D. Torres denying DARs
motion for reconsideration for having been filed beyond the reglementary period of fifteen (15) days. The said order further
declared that the March 29, 1996 OP decision had already become final and executory.

21. The DAR filed on July 11, 1997 a second motion for reconsideration of the June 23, 1997 Order of the President.

22. On August 12, 1997, the said writ of preliminary injunction issued by the RTC was challenged by some alleged
farmers before the Court of Appeals through a petition for certiorari and prohibition, docketed as CA-G.R. SP No. 44905,
praying for the lifting of the injunction and for the issuance of a writ of prohibition from further trying the RTC case.

23. On October 9, 1997, some alleged farmer-beneficiaries began their hunger strike in front of the DAR Compound in
Quezon City to protest the OP Decision of March 29, 1996. On October 10, 1997, some persons claiming to be farmer-
beneficiaries of the NQSRMDC property filed a motion for intervention (styled as Memorandum In Intervention) in O.P. Case
No. 96-C-6424, asking that the OP Decision allowing the conversion of the entire 144-hectare property be set aside.[25]

24. President Fidel V. Ramos then held a dialogue with the strikers and promised to resolve their grievance within the
framework of the law. He created an eight (8)-man Fact Finding Task Force (FFTF) chaired by Agriculture Secretary Salvador
Escudero to look into the controversy and recommend possible solutions to the problem.[26]

25. On November 7, 1997, the Office of the President resolved the strikers protest by issuing the so-called Win/Win
Resolution penned by then Deputy Executive Secretary Renato C. Corona, the dispositive portion of which reads:

WHEREFORE, premises considered, the decision of the Office of the President, through Executive Secretary Ruben Torres,
dated March 29, 1996, is hereby MODIFIED as follows:

1. NQSRMDCs application for conversion is APPROVED only with respect to the approximately forty-four
(44) hectare portion of the land adjacent to the highway, as recommended by the Department of
Agriculture.

2. The remaining approximately one hundred (100) hectares traversed by an irrigation canal and found to be
suitable for agriculture shall be distributed to qualified farmer-beneficiaries in accordance with RA 6657
or the Comprehensive Agrarian Reform Law with a right of way to said portion from the highway
provided in the portion fronting the highway. For this purpose, the DAR and other concerned government
agencies are directed to immediately conduct the segregation survey of the area, valuation of the
property and generation of titles in the name of the identified farmer-beneficiaries.

3. The Department of Agrarian Reform is hereby directed to carefully and meticulously determine who among
the claimants are qualified farmer-beneficiaries.

4. The Department of Agrarian Reform is hereby further directed to expedite payment of just compensation to
NQSRMDC for the portion of the land to be covered by the CARP, including other lands previously
surrendered by NQSRMDC for CARP coverage.

5. The Philippine National Police is hereby directed to render full assistance to the Department of Agrarian
Reform in the implementation of this Order.

We take note of the Memorandum in Intervention filed by 113 farmers on October 10, 1997 without ruling on the propriety or
merits thereof since it is unnecessary to pass upon it at this time.

SO ORDERED.[27]

A copy of the Win-Win Resolution was received by Governor Carlos O. Fortich of Bukidnon, Mayor Rey B. Baula of
Sumilao, Bukidnon, and NQSRMDC on November 24, 1997[28] and, on December 4, 1997, they filed the present petition for
certiorari, prohibition (under Rule 65 of the Revised Rules of Court) and injunction with urgent prayer for a temporary restraining
order and/or writ of preliminary injunction (under Rule 58, ibid.), against then Deputy Executive Secretary Renato C. Corona
and DAR Secretary Ernesto D. Garilao.
 On December 12, 1997, a Motion For Leave To Intervene[29] was filed by alleged farmer-beneficiaries, through counsel,
claiming that they are real parties in interest as they were previously identified by respondent DAR as agrarian reform
beneficiaries on the 144-hectare property subject of this case. The motion was vehemently opposed[30] by the petitioners.

In seeking the nullification of the Win-Win Resolution, the petitioners claim that the Office of the President was prompted
to issue the said resolution after a very well-managed hunger strike led by fake farmer-beneficiary Linda Ligmon succeeded in
pressuring and/or politically blackmailing the Office of the President to come up with this purely political decision to appease the
farmers, by reviving and modifying the Decision of 29 March 1996 which has been declared final and executory in an Order
of 23 June 1997.[31] Thus, petitioners further allege, respondent then Deputy Executive Secretary Renato C. Corona committed
grave abuse of discretion and acted beyond his jurisdiction when he issued the questioned Resolution of 7 November
1997.[32] They availed of this extraordinary writ of certiorari because there is no other plain, speedy and adequate remedy in the
ordinary course of law.[33] They never filed a motion for reconsideration of the subject Resolution because (it) is patently illegal
or contrary to law and it would be a futile exercise to seek a reconsideration .[34]

The respondents, through the Solicitor General, opposed the petition and prayed that it be dismissed outright on the
following grounds:

(1) The proper remedy of petitioners should have been to file a petition for review directly with the Court of Appeals in
accordance with Rule 43 of the Revised Rules of Court;

(2) The petitioners failed to file a motion for reconsideration of the assailed Win-Win Resolution before filing the present
petition; and

(3) Petitioner NQSRMDC is guilty of forum-shopping.

These are the preliminary issues which must first be resolved, including the incident on the motion for intervention filed by
the alleged farmer-beneficiaries.

Anent the first issue, in order to determine whether the recourse of petitioners is proper or not, it is necessary to draw a
line between an error of judgment and an error of jurisdiction. An error of judgment is one which the court may commit in the
exercise of its jurisdiction, and which error is reviewable only by an appeal.[35] On the other hand, an error of jurisdiction is
one where the act complained of was issued by the court, officer or a quasi-judicial body without or in excess of jurisdiction,
or with grave abuse of discretion which is tantamount to lack or in excess of jurisdiction.[36] This error is correctable only by the
extraordinary writ of certiorari.[37]

It is true that under Rule 43, appeals from awards, judgments, final orders or resolutions of any quasi-judicial agency
exercising quasi-judicial functions,[38] including the Office of the President,[39] may be taken to the Court of Appeals by filing a
verified petition for review[40] within fifteen (15) days from notice of the said judgment, final order or resolution,[41] whether the
appeal involves questions of fact, of law, or mixed questions of fact and law. [42]

However, we hold that, in this particular case, the remedy prescribed in Rule 43 is inapplicable considering that the
present petition contains an allegation that the challenged resolution is patently illegal[43] and was issued with grave abuse of
discretion and beyond his (respondent Secretary Renato C. Coronas) jurisdiction[44] when said resolution substantially modified
the earlier OP Decision of March 29, 1996 which had long become final and executory. In other words, the crucial issue raised
here involves an error of jurisdiction, not an error of judgment which is reviewable by an appeal under Rule 43. Thus, the
appropriate remedy to annul and set aside the assailed resolution is an original special civil action for certiorari under Rule 65,
as what the petitioners have correctly done. The pertinent portion of Section 1 thereof provides:

SECTION 1. Petition for certiorari. When any tribunal, board or officer exercising judicial or quasi-judicial functions has acted
without or in excess of its or his jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and
there is no appeal, or any plain, speedy, and adequate remedy in the ordinary course of law, a person aggrieved thereby may
file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered annulling or
modifying the proceedings of such tribunal, board or officer, and granting such incidental reliefs as law and justice may require.

x x x x x x x x x.

The office of a writ of certiorari is restricted to truly extraordinary cases cases in which the act of the lower court or quasi-judicial
body is wholly void.[45]

The aforequoted Section 1 of Rule 65 mandates that the person aggrieved by the assailed illegal act may file a verified
petition (for certiorari) in the proper court. The proper court where the petition must be filed is stated in Section 4 of the same
Rule 65 which reads:

SEC. 4. Where petition filed.- The petition may be filed not later than sixty (60) days from notice of the judgment, order or
resolution sought to be assailed in the Supreme Court or, if it relates to the acts or omissions of a lower court or of a
corporation, board, officer or person, in the Regional Trial Court exercising jurisdiction over the territorial area as defined by the
Supreme Court. It may also be filed in the Court of Appeals whether or not the same is in aid of its appellate jurisdiction, or in
the Sandiganbayan if it is in aid of its jurisdiction. If it involves the acts or omissions of a quasi-judicial agency, and unless
otherwise provided by law or these Rules, the petition shall be filed in and cognizable only by the Court of Appeals. (4a)

Under the above-quoted Section 4, the Supreme Court, Court of Appeals and Regional Trial Court have original
concurrent jurisdiction to issue a writ of certiorari, [46] prohibition[47] and mandamus.[48] But the jurisdiction of these three (3)
courts are also delineated in that, if the challenged act relates to acts or omissions of a lower court or of a corporation, board,
officer or person, the petition must be filed with the Regional Trial Court which exercises jurisdiction over the territorial area as
defined by the Supreme Court. And if it involves the act or omission of a quasi-judicial agency, the petition shall be filed only
with the Court of Appeals, unless otherwise provided by law or the Rules of Court. We have clearly discussed this matter of
concurrence of jurisdiction in People vs. Cuaresma, et. al.,[49] through now Chief Justice Andres R. Narvasa, thus:

x x x. This Courts original jurisdiction to issue writs of certiorari (as well as prohibition, mandamus, quo warranto, habeas
corpus and injunction) is not exclusive. It is shared by this Court with Regional Trial Courts (formerly Courts of First Instance),
which may issue the writ, enforceable in any part of their respective regions. It is also shared by this Court, and by the Regional
Trial Court, with the Court of Appeals (formerly, Intermediate Appellate Court), although prior to the effectivity of Batas
Pambansa Bilang 129 on August 14, 1981, the latters competence to issue the extraordinary writs was restricted to those in aid
of its appellate jurisdiction. 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 should also serve 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. (Citations omitted)

But the Supreme Court has the full discretionary power to take cognizance of the petition filed directly to it if compelling
reasons, or the nature and importance of the issues raised, warrant. This has been the judicial policy to be observed and which
has been reiterated in subsequent cases, namely:[50] Uy vs. Contreras, et. al.,[51] Torres vs. Arranz,[52] Bercero vs. De
Guzman,[53] and Advincula vs. Legaspi, et. al.[54] As we have further stated in Cuaresma:

x x x. 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 established policy. It is a policy
that is 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.

Pursuant to said judicial policy, we resolve to take primary jurisdiction over the present petition in the interest of speedy
justice[55] and to avoid future litigations so as to promptly put an end to the present controversy which, as correctly observed by
petitioners, has sparked national interest because of the magnitude of the problem created by the issuance of the assailed
resolution. Moreover, as will be discussed later, we find the assailed resolution wholly void and requiring the petitioners to file
their petition first with the Court of Appeals would only result in a waste of time and money.

That the Court has the power to set aside its own rules in the higher interests of justice is well-entrenched in our
jurisprudence. We reiterate what we said in Piczon vs. Court of Appeals:[56]

Be it remembered that rules of procedure are but mere tools designed to facilitate the attainment of justice. Their strict and rigid
application, which would result in technicalities that tend to frustrate rather than promote substantial justice, must always be
avoided. Time and again, this Court has suspended its own rules and excepted a particular case from their operation whenever
the higher interests of justice so require. In the instant petition, we forego a lengthy disquisition of the proper procedure that
should have been taken by the parties involved and proceed directly to the merits of the case."

As to the second issue of whether the petitioners committed a fatal procedural lapse when they failed to file a motion for
reconsideration of the assailed resolution before seeking judicial recourse, suffice it to state that the said motion is not
necessary when the questioned resolution is a patent nullity, [57] as will be taken up later.

With respect to the third issue, the respondents claim that the filing by the petitioners of: (a) a petition for certiorari,
prohibition with preliminary injunction (CA-G.R. SP No. 37614) with the Court of Appeals; (b) a complaint for annulment and
cancellation of title, damages and injunction against DAR and 141 others (Civil Case No. 2687-97) with the Regional Trial Court
of Malaybalay, Bukidnon; and (c) the present petition, constitute forum shopping.

We disagree.

The rule is that:

There is forum-shopping whenever, as a result of an adverse opinion in one forum, a party seeks a favorable opinion (other
than by appeal or certiorari) in another. The principle applies not only with respect to suits filed in the courts but also in
connection with litigation commenced in the courts while an administrative proceeding is pending, as in this case, in order to
defeat administrative processes and in anticipation of an unfavorable administrative ruling and a favorable court ruling. This
specially so, as in this case, where the court in which the second suit was brought, has no jurisdiction (citations omitted).

The test for determining whether a party violated the rule against forum shopping has been laid down in the 1986 case of Buan
vs. Lopez (145 SCRA 34), x x x and that is, forum shopping exists where the elements of litis pendentia are present or
where a final judgment in one case will amount to res judicata in the other, as follows:

There thus exists between the action before this Court and RTC Case No. 86-36563 identity of parties, or at least such parties
as represent the same interests in both actions, as well as identity of rights asserted and relief prayed for, the relief being
founded on the same facts, and the identity on the two preceding particulars is such that any judgment rendered in the other
action, will, regardless of which party is successful, amount to res adjudicata in the action under consideration: all the
requisites, in fine, of auter action pendant.'[58]

It is clear from the above-quoted rule that the petitioners are not guilty of forum shopping. The test for determining
whether a party has violated the rule against forum shopping is where a final judgment in one case will amount to res
adjudicata in the action under consideration. A cursory examination of the cases filed by the petitioners does not show that the
said cases are similar with each other. The petition for certiorari in the Court of Appeals sought the nullification of the DAR
Secretarys order to proceed with the compulsory acquisition and distribution of the subject property. On the other hand, the civil
case in RTC of Malaybalay, Bukidnon for the annulment and cancellation of title issued in the name of the Republic of the
Philippines, with damages, was based on the following grounds: (1) the DAR, in applying for cancellation of petitioner
NQSRMDCs title, used documents which were earlier declared null and void by the DARAB; (2) the cancellation of
NQSRMDCs title was made without payment of just compensation; and (3) without notice to NQSRMDC for the surrender of its
title. The present petition is entirely different from the said two cases as it seeks the nullification of the assailed Win-Win
Resolution of the Office of the President dated November 7, 1997, which resolution was issued long after the previous two
cases were instituted.

The fourth and final preliminary issue to be resolved is the motion for intervention filed by alleged farmer-beneficiaries,
which we have to deny for lack of merit. In their motion, movants contend that they are the farmer-beneficiaries of the land in
question, hence, are real parties in interest. To prove this, they attached as Annex I in their motion a Master List of Farmer-
Beneficiaries. Apparently, the alleged master list was made pursuant to the directive in the dispositive portion of the assailed
Win-Win Resolution which directs the DAR to carefully and meticulously determine who among the claimants are qualified
farmer-beneficiaries. However, a perusal of the said document reveals that movants are those purportedly Found Qualified and
Recommended for Approval. In other words, movants are merely recommendee farmer-beneficiaries.

The rule in this jurisdiction is that a real party in interest is a party who would be benefited or injured by the judgment or
is the party entitled to the avails of the suit. Real interestmeans a present substantial interest, as distinguished from a mere
expectancy or a future, contingent, subordinate or consequential interest. [59] Undoubtedly, movants interest over the land in
question is a mere expectancy. Ergo, they are not real parties in interest.

Furthermore, the challenged resolution upon which movants based their motion is, as intimated earlier, null and void.
Hence, their motion for intervention has no leg to stand on.

Now to the main issue of whether the final and executory Decision dated March 29,1996 can still be substantially
modified by the Win-Win Resolution.

We rule in the negative.

The rules and regulations governing appeals to the Office of the President of the Philippines are embodied in
Administrative Order No. 18. Section 7 thereof provides:

SEC. 7. Decisions/resolutions/orders of the Office of the President shall, except as otherwise provided for by special
laws, become final after the lapse of fifteen (15) days from receipt of a copy thereof by the parties, unless a motion for
reconsideration thereof is filed within such period.

Only one motion for reconsideration by any one party shall be allowed and entertained, save in exceptionally meritorious
cases. (Emphasis ours)

It is further provided for in Section 9 that The Rules of Court shall apply in a suppletory character whenever practicable.

When the Office of the President issued the Order dated June 23,1997 declaring the Decision of March 29, 1996 final
and executory, as no one has seasonably filed a motion for reconsideration thereto, the said Office had lost its jurisdiction to re-
open the case, more so modify its Decision. Having lost its jurisdiction, the Office of the President has no more authority to
entertain the second motion for reconsideration filed by respondent DAR Secretary, which second motion became the basis of
the assailed Win-Win Resolution. Section 7 of Administrative Order No. 18 and Section 4, Rule 43 of the Revised Rules of
Court mandate that only one (1) motion for reconsideration is allowed to be taken from the Decision of March 29, 1996. And
even if a second motion for reconsideration was permitted to be filed in exceptionally meritorious cases, as provided in the
second paragraph of Section 7 of AO 18, still the said motion should not have been entertained considering that the first motion
for reconsideration was not seasonably filed, thereby allowing the Decision of March 29, 1996 to lapse into finality. Thus, the
act of the Office of the President in re-opening the case and substantially modifying its March 29,1996 Decision which had
already become final and executory, was in gross disregard of the rules and basic legal precept that accord finality to
administrative determinations.

In San Luis, et al. vs. Court of Appeals, et al.[60] we held:

Since the decisions of both the Civil Service Commission and the Office of the President had long become final and executory,
the same can no longer be reviewed by the courts. It is well-established in our jurisprudence that the decisions and orders of
administrative agencies, rendered pursuant to their quasi-judicial authority, have upon their finality, the force and binding effect
of a final judgment within the purview of the doctrine of res judicata [Brillantes v. Castro, 99 Phil. 497 (1956), Ipekdijna
Merchandizing Co., Inc. v. Court of Tax Appeals, G.R. No. L-15430, September 30, 1963, 9 SCRA 72.] The rule of res
judicata which forbids the reopening of a matter once judicially determined by competent authority applies as well to the judicial
and quasi-judicial acts of public, executive or administrative officers and boards acting within their jurisdiction as to the
judgments of courts having general judicial powers [Brillantes v. Castro, supra at 503].

The orderly administration of justice requires that the judgments/resolutions of a court or quasi-judicial body must reach a
point of finality set by the law, rules and regulations. The noble purpose is to write finis to disputes once and for all. [61] This is a
fundamental principle in our justice system, without which there would be no end to litigations. Utmost respect and adherence
to this principle must always be maintained by those who wield the power of adjudication. Any act which violates such principle
must immediately be struck down.
 Therefore, the assailed Win-Win Resolution which substantially modified the Decision of March 29, 1996 after it has
attained finality, is utterly void. Such void resolution, as aptly stressed by Justice Thomas A. Street [62] in a 1918 case,[63] is a
lawless thing, which can be treated as an outlaw and slain at sight, or ignored wherever and whenever it exhibits its head.[64]

WHEREFORE, the present petition is hereby GRANTED. The challenged Resolution dated November 7, 1997, issued by
the Office of the President in OP Case No. 96-C-6424, is hereby NULLIFIED and SET ASIDE. The Motion For Leave To
Intervene filed by alleged farmer-beneficiaries is hereby DENIED.

No pronouncement as to costs.

SO ORDERED.

Regalado, (Chairman), Melo, Puno, and Mendoza, JJ., concur.

G.R. No. 188299 January 23, 2013

HEIRS OF LUIS A. LUNA and REMEGIO A. LUNA, and LUZ LUNA-SANTOS, as represented by their Attorney-in-fact,
AUREA B. LUBIS, Petitioners,
vs.
RUBEN S. AFABLE, TOMAS M. AFABLE, FLORANTE A. EVANGELISTA, LEOVY S. EVANGELISTA, JAIME M. ILAGAN
ET, AL., Respondents.

DECISION

PEREZ, J.:

The power of local government units to convert or reclassify lands from agricultural to non-agricultural prior to the passage of
Republic Act (RA) No. 6657 – the Comprehensive Agrarian Reform Law (CARL) – is not subject to the approv3l of the
Department of Agrarian Reform (DAR).1 In this sense, the authority of local government units to reclassify land before 15 June
1988 – the date of effectivity of the CARL – may be said to be absolute.

Before the Court is a Petition for Review on Certiorari seeking to reverse and set aside the 13 March 2009 Decision 2 of the
Court of Appeals (CA) in CA-G.R. SP No. 101114 and its 10 June 2009 Resolution3 denying petitioners’ motion for
reconsideration.

The Facts

Petitioners are co-owners of a parcel of land covered by Transfer Certificate of Title (TCT) No. J-7205 (T-54199), with an area
of 158.77 hectares, located in Barangay Guinobatan, Calapan City, Oriental Mindoro.4 100.2856 hectares of the landholding
was subjected to compulsory acquisition under the Comprehensive Agrarian Reform Program (CARP) through a Notice of Land
Valuation and Acquisition dated 20 August 1998 issued by the Provincial Agrarian Reform Officer (PARO) and published in a
newspaper of general circulation on 29, 30 and 31 August 1998. 5

Respondents were identified by the DAR as qualified farmer-beneficiaries; hence, the corresponding Certificates of Land
Ownership Award (CLOAs) were generated, issued to respondents and duly registered in their names on 12 October 1998.6

On 21 October 1998, petitioners filed before the DAR Adjudication Board (DARAB) Oriental Mindoro a Petition for "Cancellation
of CLOAs, Revocation of Notice of Valuation and Acquisition and Upholding and Affirming the Classification of Subject Property
and Declaring the same outside the purview of RA No. 6657."7 The petition was anchored mainly on the reclassification of the
land in question into a light intensity industrial zone pursuant to Municipal Ordinance No. 21, series of 1981, enacted by the
Sangguniang Bayan of Calapan, thereby excluding the same from the coverage of the agrarian law.

The Ruling of the DARAB Calapan City

In a Decision dated 26 August 1999, the DARAB disposed of the petition in the following manner:

IN THE LIGHT OF the foregoing, judgment is hereby rendered:

1. Ordering the Cancellation of Certificates of Land Ownership Award x x x issued by the Department of Agrarian
Reform in favor of private respondents pursuant to RA No. 6657 covering the subject parcel of land under TCT No. 5-
7205 [sic] (T-54199) of the Registry of Deeds for the Province of Oriental Mindoro, in the name of Luis Luna, et. al.,

2. Upholding and affirming the classification of the subject parcel of land into residential, commercial and institutional
uses pursuant to RA No. 2264 (Autonomy Act of 1959) and the Local Government Code of 1991;

3. Declaring the farmholding in question outside the purview of Republic Act No. 6657;

x x x x8

The DARAB found that petitioners’ property is exempt from the CARP as it has been reclassified as non-agricultural prior to the
effectivity of Republic Act (RA) No. 6657. According to the DARAB, the records of the case indicate that subject parcel of land
was classified as within the residential, commercial and industrial zone by the Sangguniang Bayan of Calapan, Oriental
Mindoro through Resolution No. 139, Series of 1981, enacted on 14 April 1981 as Municipal Ordinance No. 21. Moreover, the
Office of the City Assessor has also classified the property as residential, commercial and industrial in use under the tax
declaration covering the same. Finally, the Office of the Deputized Zoning Administrator, Urban Planning and Development
Office, Calapan City, issued a Certification on 25 September 1998 stating that "under Article III, Section 3, No. 7 of Resolution
No. 139, Municipal Ordinance No. 21, Series of 1981, areas covered by this [sic] provisions has [sic] been declared as Light
Intensity Industrial Zone prior to the approval of RA 6657 x x x."9
The DARAB cited Department of Justice (DOJ) Opinion No. 44, Series of 1990, which provides that a parcel of land is
considered non-agricultural and, therefore, beyond the coverage of the CARP, if it had been classified as residential,
commercial, or industrial in the city or municipality where the Land Use Plan or zoning ordinance has been approved by the
Housing and Land Use Regulatory Board (HLURB) before 15 June 1988, the date of effectivity of RA No. 6657. The
aforementioned Opinion of the DOJ further states that all lands falling under this category, that is, lands already classified as
commercial, industrial or residential, before 15 June 1988 no longer need any conversion clearance from the DAR. 10

Aggrieved, respondents appealed to the DARAB Central Office.

The Ruling of the DARAB Central Office

The Central Office of the DARAB found that its local office in Calapan City erred in declaring petitioners’ property outside the
coverage of the CARP by relying solely on the assertion of the landowners that the land had already been reclassified from
agricultural to non-agricultural prior to 15 June 1988.11

The DARAB held that the local Adjudicator misconstrued DOJ Opinion No. 44, Series of 1990 and, in the process, overlooked
DAR Administrative Order (AO) No. 2, Series of 1994 which provides the grounds upon which CLOAs may be cancelled,
among which is that the land is found to be exempt or excluded from CARP coverage or is to be part of the landowner’s
retained area as determined by the Secretary of Agrarian Reform or his authorized representative. Thus, the DARAB
concluded, the issue of whether or not petitioners’ land is indeed exempt from CARP coverage is still an administrative matter
to be determined exclusively by the DAR Secretary or his authorized representative. In short, an exemption clearance from the
DAR is still required. In this connection, DAR AO No. 6 was issued on 27 May 1994 setting down the guidelines in the issuance
of exemption clearance based on Section 3(c) of RA No. 6657 and DOJ Opinion No. 44, Series of 1990. Pursuant thereto, "any
landowner or his duly authorized representative whose lands are covered by DOJ Opinion No. 44-S-1990, and desires to have
an exemption clearance from the DAR, should file the application with the Regional Office of the DAR where the land is
located."12 (Underlining omitted)

Accordingly, the DARAB set aside the Decision dated 26 August 1999 of the DARAB Calapan City for lack of jurisdiction and
referred13 the case to the Regional Office of DAR Region IV for final determination as to whether the land covered by TCT No.
J-7205 (T-54199) in the names of Luis Luna, et al. is exempt from CARP coverage. 14

In an apparent response to the above ruling of the DARAB holding that petitioners still need an exemption clearance from the
DAR, petitioners filed an application for exemption from CARP coverage of subject land.

The Ruling of the DAR

(On Petitioners’ Application for Exemption from CARP coverage)

In an Order dated 16 December 2003, then DAR Secretary Roberto M. Pagdanganan (Pagdanganan) granted petitioners’
application for exemption based on the following findings:

In a joint ocular inspection and investigation conducted by the representatives of the Municipal Agrarian Reform Office MARO,
PARO and Regional Center for Land Use Policy, Planning and ImplementationRCLUPPI on September 18 2003, disclosed the
following findings:

1. The documents (HLURB and Deputized Zoning AdministratorDZA Certifications) show that the whole 158 hectares
is exempted from the coverage of RA 6657;

2. It is not irrigated;

3. The area where subject property is located can be considered as already urbanizing; and

4. The topography is generally flat and the property is traversed by a concrete highway hence accessible to all
means of land transportation.

xxxx

DOJ Opinion No. 44, Series of 1990 and the case of Natalia Realty vs. Department of Agrarian Reform (12 August 1993/225
SCRA 278) opines (sic) that with respect to the conversion of agricultural lands covered by RA No. 6657 to non-agricultural
uses, the authority of the Department of Agrarian Reform to approve such conversion maybe [sic] exercised from the date of its
effectivity on 15 June 1988. Thus, all lands that are already classified as commercial, industrial or residential before 15 June
1988 no longer need any conversion clearance. Moreover, Republic Act No. 6657 or the Comprehensive Agrarian Reform Law
(CARL), Section 3, Paragraph (c) defines "agricultural land" as referring to "land devoted to agricultural activity as defined in
this Act and not classified as mineral, forest, residential, commercial or industrial land." The case before this Office clearly
reveals that the subject property is not within the agricultural zone prior to 15 June 1988.
The subject property has been zoned as light-industrial prior to the enactment of the Comprehensive Agrarian Reform Program
as shown by the various certifications issued by the HLURB 15 and CPDC of Calapan City, Mindoro stating that the subject
properties were reclassified to light-industrial zone by the City of Calapan, Mindoro and approved by the Human Settlements
Regulatory Commission (now HLURB) per Resolution No. R-39-04 on 31 July 1980.

In view of the foregoing, this Office finds the application to have fully complied with all the documentary requirements for
exemption set forth under DAR A.O. 6 Series of 1994 guidelines. x x x.16

The application for exemption was, therefore, granted subject to the condition, among others, that disturbance compensation
shall be paid to affected tenants, farm workers, or bona fide occupants of the land. 17

Predictably, respondents filed a motion for reconsideration of the Order of exemption.

The Ruling of the DAR

(On Respondents’ Motion for Reconsideration)

In a Resolution dated 15 June 2004, former DAR Officer-in-Charge (OIC)-Secretary Jose Mari B. Ponce (Ponce) granted
respondents’ motion for reconsideration based on the following considerations:

Resolution No. R-39-4 Series of 1980 of the then Municipality of Calapan as conditionally approved by Human Settlement
Regulatory Commission (now HLURB) did not categorically place the entire landholding for light-industrial. Section 1(f), Art. III
of said resolution provided that:

"(f) I-1 Zone – Light Industrial are the following:

All lots 100 meters deep east and 200 meters deep west of Sto. Niño-Lumangbayan-Sapul Road from the Teachers’ Village
down to Barangay Guinobatan."

Resolution No. 151, City Ordinance No. 6 which declared the whole area of Barangay Guinobatan into residential, commercial
and institutional uses was approved by the Calapan City Council only on 23 June 1998. Furthermore, the Comprehensive Land
Use Plan and Zoning for Calapan City was approved by the Sangguniang Panlalawigan only in 2001 through Resolution No.
218, Series of 2001.

xxxx

x x x. Hence, in the case at hand, subject property is still within the ambit of the Comprehensive Agrarian Reform Program
since the same were [sic] reclassified only in 1998 through Resolution No. 151, City Ordinance No. 6, and was approved by the
Sangguniang Panlalawigan only in 2001 through Resolution No. 218, Series of 2001 long after the effectivity of RA 6657. 18

Thus, the Order dated 16 December 2003 issued by DAR Secretary Pagdanganan was set aside, revoked and cancelled. 19

Petitioners filed a motion for reconsideration of this Resolution.

The Ruling of the DAR

(On Petitioners’ Motion for Reconsideration)

On 21 June 2006, the DAR, through then OIC Secretary Nasser C. Pangandaman (Pangandaman), issued an Order denying
petitioners’ motion for reconsideration on the following grounds:

On 13 October 2005, the CLUPPI Inspection Team, accompanied by the Municipal Agrarian Reform Officer (MARO), Provincial
Agrarian Reform Officer (PARO) and other DAR Field Personnel, conducted an ocular inspection of the subject landholding and
noted the following:

• The landholding is composed of four (4) parcels embraced under TCT No. J-7205, with an area of 153.7713
hectares and located in Brgy. Guinobatan, Calapan City, Oriental Mindoro;

• The topography varies: Lot No. 612-D is flat, while Lot Nos. 612-A, 612-B and 612-C are flat to hilly;

• There were no billboards visible in the premises;

• There were grasses, some fruit trees and vegetable, but generally, planted with rice;
 • Tenants/farmworkers/protestants were present during the inspection;

• A spring was seen in the area, which serves as a source of water for the riceland and irrigation canal;

• The provincial highway traverses the property;

• Surrounding areas are still agricultural in nature; and

• A newly constructed city hall was built in the riceland area covering a portion of five (5) hectares out of the eighty
(80)-hectare riceland area.

xxxx

A careful perusal of the facts and circumstances show that the petitioners failed to offer substantial evidence that would warrant
reversal of the Order.

Resolution No. R-39-4, Series of 1980 of the then Municipality of Calapan, conditionally approved by Human Settlement
Regulatory Commission, did not categorically place the entire landholding under Light Industrial Zone. x x x.

xxxx

The Certification issued on 8 October 1998 by the Housing and Land Use Regulatory Board (HLURB) 20 proved that the
property is still agricultural. The same provides that the landholding is within the Light Industrial Zone (100 meters deep west
and 200 meters deep east) of the Provincial Road and the rest is Agricultural Zone based on the Zoning Ordinance approved
by HLURB Resolution No. R-9-34 dated 31 July 1980. It was re-classified into residential, commercial and institutional uses
pursuant to Sangguniang Panlungsod Resolution No. 151, Ordinance No. 6 only on 23 June 1998. The 1981 Ordinance, albeit
approved by the HLURB, did not automatically reclassify the land. Physical aspects of the landholding are actually agricultural
as there are some fruit trees and generally, planted with rice. Also, the surrounding areas are apparently agricultural in usage.

On 11 January 2006, the Municipal Agrarian Reform Officer (MARO) submitted a report stating that the Light Industrial Zone
which covers the fraction covering 100 meters deep west and 200 meters deep east along the provincial road traversing the
property areas which were declared in the HLURB Certification dated 08 October 1998, were already covered by Presidential
Decree No. 27. Thus, there was already a vested right over the property and can no longer be covered by an Application for
Exemption Clearance.21

The Order dated 15 June 2004 granting the motion for reconsideration filed by the farmer-beneficiaries was, therefore, affirmed
in toto.

Petitioners, consequently, filed an appeal before the Office of the President.

The Ruling of the Office of the President

In its Decision dated 15 December 2006, the Office of the President found petitioners’ appeal impressed with merit. It quoted
with approval the findings and conclusions of former DAR Secretary Pagdanganan in his Order of 16 December 2003. 22

According to the Office of the President, contrary to the findings and conclusions of the DAR in its Resolution dated 15 June
2004, the area where subject property is situated was really intended to be classified, not as agricultural, as in fact it was
declared as residential, commercial and institutional in 1998.23

Moreover, supervening events have transpired such that subjecting the property to CARP coverage would already be
inappropriate under the circumstances. The Sangguniang Panlungsod approved City Ordinance No. 6, Resolution No. 151,
declaring the whole area of Barangay Guinobatan into a residential, commercial and industrial zone on 23 June 1998. The

Notice of Acquisition and Land Valuation covering 100.2856 hectares out of the 158.77 hectares total land area of the property
was issued by the DAR only on 20 August 1998. On 25 September 1998, a Certification was issued by the City Planning and
Development Officer/Deputized Zoning

Administrator, classifying subject property as within the Light Intensity Industrial Zone based on Sangguniang Bayan Resolution
No. 139, Municipal Ordinance No. 21, Series of 1981, Section 3 of RA 6657, DOJ Opinion No. 44, Series of 1990 and
Sangguniang Panlungsod Ordinance No. 6, Series of 1998. The application for exemption from CARP coverage filed by
petitioners was initially granted by the DAR in 2003. The Certificate of Zoning Classification dated 18 December 2003 issued by
the Zoning and Land Use Division of the Urban Planning and Development Department classifies the subject property as an
urban Development Zone, based on City Resolution No. 231, Ordinance No. 4, Series of 1999 and Sangguniang Panlalawigan
Resolution No. 218, Series of 2001.24
The Office of the President further held that from the time portions of subject property were declared to be within the Light
Intensity Industrial Zone in 2003, it was never established that it had been devoted to agricultural purposes. Besides, the
confirmation of its falling within the residential, commercial and industrial zone was ahead of the Notice of Acquisition. It would
not be proper to subject a residential, commercial and industrial property to CARP anymore. 25

In conclusion, the Office of the President declared that the 16 December 2003 Order of the DAR is more in accord with the
facts and law relevant to the case. Hence, it set aside, revoked and cancelled the Resolution and Order, dated 15 June 2004
and 21 June 2006, respectively, of former DAR OIC-Secretaries Ponce and Pangandaman and reinstated the Order dated 16
December 2003 of Secretary Pagdanganan.26

The motion for reconsideration and second motion for reconsideration of respondents were respectively denied by the Office of
the President in a Resolution27 dated 12 June 2007 and an Order28 dated 13 September 2007.

Respondents then appealed to the CA.

The Ruling of the Court of Appeals

In a Decision dated 13 March 2009, the CA granted the appeal based on a finding that the ruling of the Office of the President
is not supported by substantial evidence.29

According to the CA, it is clear from the 1981 Ordinance of the Sangguniang Bayan of Calapan that only those lots 100 meters
deep west and 200 meters deep east of the Sto. Niño-Lumangbayan-Sapul Road from the Teachers’ Village Subdivision to
Barangay Guinobatan, and not the entire Barangay Guinobatan, was classified into light intensity industrial zone. If the intention
were to classify the entire Barangay Guinobatan into a light intensity industrial zone, then the 1981 Ordinance should have
provided so, instead of limiting the areas so classified based on the reference points of the lots that would be affected thereby.30

Citing the case of Natalia Realty, Inc. v. Department of Agrarian Reform, 31 wherein it was held that lands not devoted to
agricultural activity, including lands previously converted to non-agricultural uses by government agencies other than the DAR
prior to the effectivity of the CARL, are outside the coverage of the CARL, the Court of Appeals ruled that in this case, there is
no showing that subject property was in fact included in the classification of light intensity industrial zone prior to 15 June 1988,
the date of effectivity of the CARL.32

The CA further held that the fact that the Sangguniang Panlungsod of the City of Calapan later on enacted Resolution No. 151
as City Ordinance No. 6 on 23 June 1998, declaring the whole area of Barangay Guinobatan as residential, commercial and
institutional areas and site of the new City Government Center for the City of Calapan does not automatically convert the
property into a non-agricultural land exempt from the coverage of the agrarian law. It bears stressing that the 1998 Ordinance
was enacted after the effectivity of the CARL and, in order to be exempt from CARP coverage, the land must have been
classified as industrial/residential before 15 June 1988.33

The CA likewise cited with approval the findings and conclusions of then DAR OIC-Secretaries Ponce and Pangandaman in
their respective decisions and concluded that the Office of the President gravely erred when it ignored the findings in the 15
June 2004 Resolution and 21 June 2006 Order of the DAR. Said the CA:

x x x The Office of the President cannot simply brush aside the DAR’s pronouncements regarding the status of the subject
property as not exempt from CARP coverage considering that the DAR has unquestionable technical expertise on these
matters. Factual findings of administrative agencies are generally accorded respect and even finality by this Court, if such
findings are supported by substantial evidence, a situation that obtains in this case. The factual findings of the Secretary of
Agrarian Reform who, by reason of his official position, has acquired expertise in specific matters within his jurisdiction, deserve
full respect and, without justifiable reason, ought not to be altered, modified or reversed. 34

Thus, the Decision dated 15 December 2006, Resolution dated 12 June 2007, and Order dated 13 September 2007 of the
Office of the President were reversed and set aside. The Resolution dated 15 June 2004 of former DAR OIC-Secretary Ponce
and the Order dated 21 June 2006 of then DAR OIC-Secretary Pangandaman were reinstated.

Hence, this petition for review wherein petitioners seek the reversal of the aforementioned decision on the ground, among
others, that the Honorable Court of Appeals gravely erred in holding that the Decision dated 15 December 2006 of the Office of
the President is not supported by substantial evidence.35

The Issue

The core issue for resolution is whether the land subject of this case had been reclassified as non-agricultural as early as 1981,
that is, prior to the effectivity of the CARL and, therefore, exempt from its coverage.

Our Ruling

At the outset, it must be pointed out that the determination of the issue presented in this case requires a review of the factual
findings of the DAR, of the Office of the President and of the CA.
It is well settled that in a petition for review on certiorari under Rule 45 of the Rules of Court, only questions of law may be
raised.36 This Court, in numerous instances, has had occasion to explain that it is not its function to analyze or weigh evidence
all over again.37 As a rule, the Court respects the factual findings of the CA and of quasi-judicial agencies like the DAR, giving
them a certain measure of finality.38 There are, however, recognized exceptions to this rule, one of which is when the findings of
fact are conflicting.

The records of this case show that each of the agencies which rendered a ruling in this case – from the DARAB local office to
the CA – arrived at different findings and conclusions, with each body overturning the decision of the one before it. Thus, due to
the divergence of the findings of the DARAB local office on the one hand, and the DARAB Central Office on the other, and
considering the conflicting findings of former DAR Secretaries and the disparity between the findings of fact of the Office of the
President and of the CA, we are constrained to re-examine the facts of this case based on the evidence presented by both
parties.

After an assiduous review of the records of this case, this Court concludes that petitioners’ land is outside the coverage of the
agrarian reform program.

At the core of the present controversy is Resolution No. 139, later on enacted as Ordinance No. 21, series of 1981 by the
Sangguniang Bayan of Calapan, Oriental Mindoro at its regular session on 14 April 1981 and subsequently amended at its
special session of 20 October 1981.39 Ordinance No. 21 revised the comprehensive zoning regulations of the then Municipality
of Calapan. Article III, Section 3, No. 7 of the ordinance provides:

I-1 Zone

Light intensity industrial zone are the following:

All lots 100 meters deep west and 200 meters deep east of Sto. Niño-Lumangbayan-Sapul Road from the Teachers’ Village
Subdivision to Barangay Guinobatan.40

Petitioners maintain that their landholding falls within the area classified as light intensity industrial zone, as specified in the
afore-quoted provision of the ordinance. Respondents, on the other hand, insist otherwise. The settlement of this issue is
crucial in determining whether the subject landholding is within or outside the coverage of the CARL.

Section 4 of RA No. 6657 states that the coverage of the CARL is as follows:

SEC. 4. Scope. – The Comprehensive Agrarian Reform Law of 1989 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.

More specifically, the following lands are covered by the Comprehensive Agrarian Reform Program:

(a) All alienable and disposable lands of the public domain devoted to or suitable for agriculture. x x x;

(b) All lands of the public domain in excess of the specific limits as determined by Congress in the preceding
paragraph;

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

"Agricultural land" is defined under Section 3(c) of the CARL as that which is "devoted to agricultural activity x x x and not
classified as mineral, forest, residential, commercial or industrial land."

The meaning of "agricultural lands" covered by the CARL was explained further by the DAR in its AO No. 1, Series of 1990,
dated 22 March 1990, entitled "Revised Rules and Regulations Governing Conversion of Private Agricultural Land to Non-
Agricultural Uses," issued pursuant to Section 4941 of the CARL.42 Thus:

Agricultural land refers to those devoted to agricultural activity as defined in RA 6657 and not classified as mineral or forest by
the Department of Environment and Natural Resources (DENR) and its predecessor agencies, and not classified in town plans
and zoning ordinances as approved by the Housing and Land Use Regulatory Board (HLURB) and its preceding competent
authorities prior to 15 June 1988 for residential, commercial or industrial use. (Emphasis supplied) 43

It is clear from the last clause of the afore-quoted provision that a land is not agricultural, and therefore, outside the ambit of the
CARP if the following conditions concur:

1. the land has been classified in town plans and zoning ordinances as residential, commercial or industrial; and
2. the town plan and zoning ordinance embodying the land classification has been approved by the HLURB or its predecessor
agency prior to 15 June 1988.

It is undeniable that local governments have the power to reclassify agricultural into non-agricultural lands.44Section 345 of RA
No. 2264 (The Local Autonomy Act of 1959) specifically empowers municipal and/or city councils to adopt zoning and
subdivision ordinances or regulations in consultation with the National Planning Commission. 46By virtue of a zoning ordinance,
the local legislature may arrange, prescribe, define, and apportion the land within its political jurisdiction into specific uses
based not only on the present, but also on the future projection of needs.47 It may, therefore, be reasonably presumed that
when city and municipal boards and councils approved an ordinance delineating an area or district in their cities or
municipalities as residential, commercial, or industrial zone pursuant to the power granted to them under Section 3 of the Local
Autonomy Act of 1959, they were, at the same time, reclassifying any agricultural lands within the zone for non-agricultural use;
hence, ensuring the implementation of and compliance with their zoning ordinances. 48

The regulation by local legislatures of land use in their respective territorial jurisdiction through zoning and reclassification is an
exercise of police power.49 The power to establish zones for industrial, commercial and residential uses is derived from the
police power itself and is exercised for the protection and benefit of the residents of a locality. 50 Ordinance No. 21 of the
Sangguniang Bayan of Calapan was issued pursuant to Section 3 of the Local Autonomy Act of 1959 and is, consequently, a
valid exercise of police power by the local government of Calapan.

The second requirement – that a zoning ordinance, in order to validly reclassify land, must have been approved by the HLURB
prior to 15 June 1988 – is the result of Letter of Instructions No. 729, dated 9 August 1978. According to this issuance, local
governments are required to submit their existing land use plans, zoning ordinances, enforcement systems and procedures to
the Ministry of Human Settlements – one of the precursor agencies of the HLURB – for review and ratification.51

Ordinance No. 21 was based on the Development Plan for the then Municipality of Calapan and on the Zone District Plan
prepared by its Municipal Development Staff. The Plans were adopted by the Sangguniang Bayan of Calapan through a
Resolution on 14 April 1980.52 The same were granted approval by the HLURB through Resolution No. R-39-4, series of 1980,
dated 31 July 1980.53

Based on the foregoing, there is no doubt that Ordinance No. 21 validly reclassified the area identified therein as "100 meters
deep west and 200 meters deep east of Sto. Niño-Lumangbayan-Sapul Road from the Teachers’ Village Subdivision to
Barangay Guinobatan" into a light intensity industrial zone, making the same exempt from CARL coverage.

The next – and more crucial – question to be settled now is whether or not petitioners’ landholding falls within the reclassified
zone, thereby taking it out of the coverage of the CARL.

In resolving the issue in the affirmative, former DAR Secretary Pagdanganan relied primarily on the respective Certifications
issued by the Office of the Deputized Zoning Administrator, Urban Planning and Development Department of Calapan
City54 and by the Housing and Urban Development Coordinating Council (HUDCC),55 and considered subject property as
having "been zoned as light-industrial prior to the enactment of the Comprehensive Agrarian Reform Program." Secretary
Pagdanganan consequently granted petitioners’ application for exemption pursuant to DAR AO No. 6, Series of 1994. 56 This
issuance was released by the DAR following DOJ Opinion No. 44, Series of 1990,57 wherein the Secretary of the DOJ opined
that "with respect to conversions of agricultural lands covered by RA 6657 to non-agricultural uses, the authority of the DAR to
approve such conversions may be exercised from the date of the law’s effectivity on June 15, 1998." Thus, AO No. 6 states that
"all lands that were already classified as commercial, industrial or residential before 15 June 1988 no longer need any
conversion clearance." Designed "to streamline the issuance of exemption clearances, based on DOJ Opinion No. 44," the AO
laid down the procedure and guidelines for the issuance of exemption clearances58 for landowners whose lands are covered by
DOJ Opinion No. 44, Series of 1990 and desire to obtain an exemption clearance from the DAR. Such exemption clearance
does not mean that the DAR Secretary is exempting the land from CARL coverage, with the implication that the land was
previously covered; it simply means that the CARL itself has, from the start, excluded the land from CARL coverage, and the
DAR Secretary is only affirming such fact.

The exemption order of Secretary Pagdanganan found petitioners’ application to have fully complied with the documentary
requirements for exemption set forth under AO No. 6, the more important of which are the Certifications from the Deputized
Zoning Administrator and the HUDCC stating that petitioners’ property falls within the Light Intensity Industrial Zone of Calapan
City.

Incidentally, what AO No. 6 requires is a certification from the HLURB. Although what petitioners submitted was a certification
from the HUDCC, Secretary Pagdanganan apparently considered the same as sufficient compliance with the requirements of
AO No. 6 and in fact never referred to the certification as coming from the HUDCC but was consistently identified as
"certification from the HLURB" throughout his order. We see nothing irregular in this considering that the HLURB is an agency
under the HUDCC59 and especially since the Certification of the HUDCC is itself "based on the Zoning Ordinance approval by
HLURB Resolution No. R-39-4 dated 31 July 1980."

In contrast to the exemption order issued by Secretary Pagdanganan, the resolution and order, respectively, of OIC Secretaries
Ponce and Pangandaman – which the CA cited with approval – relied mainly on certifications declaring that the property is
irrigated or has a slope of below 18% and on an ocular inspection report stating that the property is generally covered with rice
and that the surrounding areas are still agricultural, as bases for their conclusion that subject land is agricultural and, therefore,
covered by the CARL. These matters, however, no longer bear any significance in the light of the certifications of the Deputized
Zoning Administrator and the HUDCC testifying to the non-agricultural nature of the landholding in question.
The CARL, as amended, is unequivocal that only lands devoted to agricultural activity and not classified as mineral, forest,
residential, commercial or industrial land are within its scope. Thus, the slope of the land or the fact of its being irrigated or non-
irrigated becomes material only if the land is agricultural, for purposes of exempting the same from the coverage of the agrarian
law. However, if the land is non-agricultural – as is the case of the property here under consideration – the character and
topography of the land lose significance.

It must likewise be emphasized that, since zoning ordinances are based not only on the present, but also on the future
projection of needs of a local government unit, when a zoning ordinance is passed, the local legislative council obviously takes
into consideration the prevailing conditions in the area where the land subject of reclassification is situated. Accordingly, when
the then Sangguniang Bayan of Calapan enacted Ordinance No. 21, there is reasonable ground to believe that the district
subject of the reclassification, including its environs, was already developing. Thus, as found by the Office of the President: "we
find that the area where subject property is situated was really intended to be classified not as agricultural, as in fact it was
declared as a residential, commercial and institutional in 1998."60

The CA, agreeing with the finding of OIC Secretary Pangandaman, and quoting from the OIC Secretary’s order, held that the
Certification of the HUDCC "proved that the property is still agricultural."

A careful scrutiny of the aforementioned certification reveals, however, that contrary to the findings of OIC Secretary
Pangandaman and the CA, the certification, in fact, proves that petitioners’ land falls within the area classified as light intensity
industrial zone. Quoted hereunder are the pertinent portions of the certification:

This is to certify that a parcel of land with a total area of 1,587,713 square meters and situated at Brgy. Guinobatan, Calapan
City, Oriental Mindoro, a portion of which is approximately 1,537,713 square meters is applied for Zoning Certification as shown
in the vicinity map submitted by the applicant appears to be within the LIGHT INDUSTRIAL ZONE (100 meters deep west and
200 meters deep east) of the Provincial Road and the rest is AGRICULTURAL ZONE based on the Zoning Ordinance approval
by HLURB Resolution No. R-39-4 dated 31 July 1980. (Emphasis supplied)

Submitted Transfer Certificate of Title described as:

TCT NO. LOT NO. AREA (sq.m.) REGISTERED OWNER

J-7205 612 1,531,713 (sic) Luis A. Luna, et al.

x x x x61

Based on the foregoing, 1,537,713 square meters (sq. ms.) out of the 1,587,713 sq. ms. total area of petitioners’ property have
been zoned as light industrial and only 50,000 sq. ms. apparently remain agricultural. Considering, however, the certification of
the Deputized Zoning

Administrator of the Urban Planning and Development Department of Calapan City, this Court finds and so holds that the entire
landholding has been classified as light intensity industrial zone pursuant to Ordinance No. 21.

The court is inclined to give more evidentiary weight to the certification of the zoning administrator being the officer having
jurisdiction over the area where the land in question is situated and is, therefore, more familiar with the property in issue.
Besides, this certification carried the presumption of regularity in its issuance 62 and respondents have the burden of overcoming
this presumption. Respondents, however, failed to present any evidence to rebut that presumption.

Accordingly, since specialized agencies, such as the HUDCC and the Office of the Deputized Zoning Administrator tasked to
determine the classification of parcels of land have already certified that the subject land is industrial, the Court must accord
such pronouncements great respect, if not finality, in the absence of evidence to the contrary.63

Respondents insist that petitioners’ landholding is not included in the light intensity industrial zone under Ordinance No. 21, yet,
they never submitted any evidence to support their contention. No maps, such as a zoning map or a land use map, clearly
showing that petitioners’ property lies outside the reclassified area were presented by respondents. Instead, what they
presented were: (1) a certification from the Provincial Irrigation Manager stating that several of the respondents were listed as
beneficiaries of the Calapan Dam Irrigators’ Association; (2) a certification from the Municipal Agriculturist of Calapan declaring
that the property is irrigated; (3) photographs of the irrigation system covering the subject landholding; (4) a letter from the Chief
of the Land Management Service of the DENR Region IV stating that the entire 158.77 hectares of the land in question falls
under 18% slope;64 (5) photographs showing that the property is generally planted with rice; 65 and other documents which,
however, do not prove nor support their claim that the property has not been reclassified into non-agricultural use.

Respondents, however, did submit in the proceedings before then DAR OIC Secretary Ponce an "approved survey plan"
commissioned by the DAR allegedly "showing that only about 20 hectares or so would be covered by" Ordinance No. 21. A
copy of this plan was nevertheless not attached to the records of this case thereby making it impossible for this Court to
examine the same and draw its own conclusions therefrom.
At any rate, as already adverted to above, the certification of the deputized zoning administrator carries more weight by reason
of his special knowledge and expertise and the matter under consideration being under his jurisdiction and competence. He is,
therefore, in a better position to attest to the classification of the property in question.

The best evidence respondents could have presented was a map showing the metes and bounds and definite delineations of
the subject land. Since respondents failed to do so, this Court is bound to rely on the certifications of the appropriate
government agencies with recognized expertise on the matter of land classification. Thus, through the certifications issued by
the deputized zoning administrator of Calapan City and by the HUDCC, petitioners were able to positively establish that their
property is no longer agricultural at the time the CARL took effect and, therefore, cannot be subjected to agrarian reform.

A final note: In his Order dated 21 June 2006, then OIC Secretary Pangandaman made mention of a "report" issued by the
MARO of Calapan City claiming that the area covering 100 meters deep west and 200 meters deep east along the provincial
road traversing the property which was declared in the HUDCC certification dated 8 October 1998 as light industrial has already
been covered by Presidential Decree No. 27.66 Thus, Secretary Pangandaman concluded, there were already vested rights
over the property and can no longer be covered by an application for exemption.

The records of this case, however, do not contain a copy of the aforementioned report.1âwphi1 Thus, the Court is unable to
scrutinize the same and make a definite ruling thereon.

In any case, an examination of the records of this case show that the earliest document evidencing coverage under the CARP
of the land subject of this dispute is the published Notice of Land Valuation and Acquisition dated 20 August 1998. Prior
thereto, all documents in connection with the compulsory acquisition of land for agrarian reform pertain to land covered by TCT
No. T-18192 with an area of 161 hectares, purportedly in the name of Mariquita A. Luna.67 Clearly, this land is different from the
land subject of this case which is covered by TCT No. J-7205 (T-54199). It may, therefore, be reasonably presumed that the
report adverted to refers to the land covered by TCT No. T-18192 and not to the property under consideration herein.

The Office of the President was, consequently, correct when it revoked the resolution and order, respectively, of former OIC
Secretaries Ponce and Pangandaman and declared that the Order of then Secretary Pagdanganan was more in accord with
the facts and the law applicable to the case at bar. Thus, the CA clearly erred when it held that the findings and conclusion of
the Office of the President are not supported by substantial evidence.

WHEREFORE, the Court GRANTS the petition and REVERSES and SETS ASIDE the Decision dated 13 March 2009 and the
Resolution dated 10 June 2009 of the Court of Appeals in CA-G.R. SP. No. 101114. The Decision of the Office of the President
dated 15 December 2006 is hereby REINSTATED.

SO ORDERED.

JOSE PORTUGAL PEREZ

Associate Justice

WE CONCUR:

ANTONIO T. CARPIO
Associate Justice
Chairperson

MARIANO C. DEL CASTILLO ESTELA M. PERLAS-BERNABE

Associate Justice Associate Justice

MARVIC MARIO VICTOR F. LEONEN*

Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of
the opinion of the Court's Division.

ANTONIO T. CARPIO
Associate Justice
Chairperson, Second Division

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson's Attestation, it is hereby certified that the
conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the
Court's Division.
MARIA LOURDES P. A. SERENO
Chief Justice
G.R. No. 189874 September 4, 2013

RODULFO VALCURZA AND BEATRIZ LASAGA, SPOUSES RONALDO GADIAN & JULIETA TAGALOG, SPOUSES
ALLAN VALCURZA AND GINA LABADO, SPOUSES ROLDAN JUMAWAN AND RUBY VALCURZA, SPOUSES
EMPERATREZ VALCURZA AND ENRIQUE VALCURZA, CIRILA PANTUHAN, SPOUSES DANIEL VALCURZA AND
JOVETA RODELA, SPOUSES LORETO NAELGA AND REMEDIOS DAROY, SPOUSES VERGILIO VALCURZA AND
ROSARIO SINELLO, SPOUSES PATRICIO EBANIT AND OTHELIA CABANDAY, SPOUSES ABNER MEDIO AND MIRIAM
TAGALOG, SPOUSES CARMEN MAGTRAYO AND MEDIO MAGTRAYO, SPOUSES MARIO VALCURZA AND EDITHA
MARBA, SPOUSES ADELARDO VALCURZA AND PRISCILLA LAGUE, SPOUSES VICTOR VALCURZA AND
MERUBELLA BEHAG, AND SPOUSES HENRY MEDIO AND ROSALINDA ALOLHA, PETITIONERS,
vs.
ATTY. CASIMIRO N. TAMPARONG, JR., RESPONDENT.

DECISION

SERENO, CJ.:

Before us is a Petition for Review on Certiorari1 of the Decision2 dated 24 September 2009 issued by the Court of Appeals (CA)
in CA-G.R. SP No. 01244-MIN. The CA reversed and set aside the Decision3 dated 26 April 2005 of the Department of Agrarian
Reform and Adjudication Board (DARAB) and reinstated the Decision4 dated 2 January 2002 of the Provincial Agrarian Reform
and Adjudication Board (PARAB).

Casimiro N. Tamparong, Jr. (respondent) is the registered owner of a landholding with an area of 412,004 square meters 5 and
covered by Original Certificate of Title (OCT) No. 0-3636 pursuant to a judicial decree rendered on 24 June 1962.7 The
Sangguniang Bayan of Villanueva, Misamis Oriental allegedly passed a Comprehensive Zoning Ordinance - Resolution No. 51-
98, Series of 1982 - classifying respondent’s land from agricultural to industrial. 8

A Notice of Coverage was issued by the Department of Agrarian Reform (DAR) on 3 November 1992 over 276,411 square
meters out of the 412,004 square meters of respondent’s land. The 276,411 square meters of land were collectively designated
as Lot No. 1100.9 The DAR Secretary eventually issued Certificate of Land Ownership Award (CLOA) No. 00102751 over the
land in favor of Rodulfo Valcurza, Beatriz Lasaga, Ronaldo Gandian, Julieta Tagalog, Allan Valcurza, Gina Labado, Roldan
Jumawan, Ruby Valcurza, Emperatrez Valcurza, Enrique Valcurza, Cirila Pantuhan, Daniel Valcurza, Joveta Rodela, Loreto
Naelga, Remedios Daroy, Vergilio Valcurza, Rosario Sinello, Patricio Ebanit, Othelia Cabanday, Abner Medio, Miriam Tagalog,
Carmen Magtrayo, Medio Magtrayo, Mario Valcurza, Editha Marba, Adelardo Valcurza, Priscilla Lague, Victor Valcurza,
Merubella Behag, Henry Medio, and Rosalinda Alolha (petitioners).10 As a result, OCT No. E-4640 was issued in favor of
petitioners on 30 May 1994.11

Respondent filed a protest against the Comprehensive Agrarian Reform Program (CARP) coverage on the ground that his land
was industrial, being found within the industrial estate of PHIVIDEC per Zoning Ordinance No. 123, Series of 1997.12 His
protest was resolved in a Resolution13 issued by Regional Director Benjamin R. de Vera on 9 October 2000. The Resolution
denied respondent’s protest because Zoning Ordinance No. 123, Series of 1997, never unequivocally stated that all the
landholdings within the PHIVIDEC area had been classified as industrial. Furthermore, the Municipal Planning and
Development Council of Villanueva, Misamis Oriental, issued a letter to the Municipal Agrarian Reform Office (MARO) stating
that Lot No. 1100 was classified as agricultural per Municipal Ordinance No. 51-98, Series of 1982. Also, PHIVIDEC certified
that the same lot is located outside the PHIVIDEC Industrial Estate. 14

Aggrieved, respondent filed a Complaint for Annulment of Certificate of Land Ownership Award No. 00102751 and Cancellation
of OCT No. E-4640 with Prayer for the Issuance of a Writ of Preliminary Injunction and/or Temporary Restraining Order. 15 In the
Complaint filed with the Provincial Adjudication Reform and Adjudication Board (PARAB) of Misamis Oriental on 6 July 2001,
he questioned the issuance of the CLOA on the ground that his land had long been classified by the municipality as industrial. It
was also covered by Presidential Proclamation No. 1962, being adjacent to the PHIVIDEC Industrial Estate, and was thus
exempted from CARP coverage.16

The PARAB declared that Comprehensive Zoning Ordinance No. 51-98, Series of 1982 had reclassified Lot No. 2252 from
agricultural to industrial land prior to the effectivity of the Comprehensive Agrarian Reform Law. It held that the complaint was
not a protest or an application for exemption, but also for annulment and cancellation of title over which DARAB had
jurisdiction. As the PARAB exercised delegated authority from the DARAB, it was but proper for the former to rule on the
complaint.17 In the exercise of this jurisdiction, the PARAB found the CARP coverage irregular and anomalous because the
issuance of the CLOA, as well as its registration with the Register of Deeds, happened before the survey plan was approved by
the DENR.18 The dispositive portion of the Decision is as follows:

WHEREFORE, premises considered, Decision is hereby rendered in favor of the plaintiff Casimiro N. Tamparong, Jr. and
against the defendants ordering as follows:

1. The immediate annulment and cancellation of CLOA No. 00102751 and OCT No. E-4640, and all other derivative
titles that may have been issued pursuant to, in connection with, and by reason of the fraudulent and perjured
coverage of the disputed land by the DAR;

2. The cancellation of Subdivision Plan Bsd-10-002693 (AR); and

 3. The ejectment of the sixteen (16) private-defendants farmer beneficiaries led by Sps. Rodulfo Valcurza, et al. from
the disputed landholding and to surrender their possession thereof to the plaintiff. 19

On appeal, the DARAB held that the identification of lands that are subject to CARP and the declaration of exemption therefrom
are within the exclusive jurisdiction of the DAR Secretary. As the grounds relied upon by petitioners in their complaint partook of
a protest against the coverage of the subject landholding from CARP and/or exemption therefrom, the DARAB concluded that
the DAR Secretary had exclusive jurisdiction over the matter.20Hence, the DARAB reversed the PARAB, maintained the validity
of the CLOA, and dismissed the complaint for lack of merit.21

Dissatisfied, respondent filed a Petition for Review under Rule 43 with the CA, which ruled that the annulment of duly registered
CLOAs with the Land Registration Authority falls within the exclusive jurisdiction of the DARAB and not of the regional director.
Furthermore, the subject landholding was considered industrial because of a zoning classification issued by the Municipal
Council of Villanueva, Misamis Oriental, prior to 15 June 1988. This ruling is consistent with the power of local governments to
reclassify lands through a local ordinance, which is not subject to DAR’s approval. 22

Thus, this Petition.

Petitioners claim that respondent’s complaint before the PARAB concerns the DAR’s implementation of the agrarian law and
implementation of CLOA as an incident thereof.23 The PARAB had no jurisdiction, because matters strictly involving the
administrative implementation of the CARL and other agrarian laws are the exclusive prerogative of and are cognizable by the
DAR Secretary.24 Yet, supposing that PARAB had jurisdiction, its authority to cancel CLOAs is based on the ground that the
land was found to be exempted or excluded from CARP coverage by the DAR Secretary or the latter’s authorized
representatives, which is not the case here.25 The subject landholding has also been declared as agricultural by various
government agencies as evidenced by the Department of Environment and Natural Resources-City Environment and Natural
Resources Office Certification declaring the land to be alienable and disposable and not covered by any public land application;
by the PHIVIDEC Industrial Authority Certification that the land is outside the industrial area of PHIVIDEC; and by the letter of
the Deputized Zoning Administrator of Villanueva, Misamis Oriental, saying that the land is classified as
agricultural.26 Moreover, the Resolution and Zoning Ordinance reclassifying the land from agricultural to industrial was not
shown to have been approved by the Housing and Land Use Regulatory Board (HLURB) or cleared by the DAR as required by
DAR Administrative Order No. 1, Series of 1990.27

In a Resolution dated 11 January 2010, we required respondent to comment, which he did.28 Upon noting his Comment, we
asked petitioners to file their reply, and they complied.29

The determination of issues brought by petitioners before this Court revolves around the sole question of whether the DARAB
has jurisdiction over the subject matter of the case.

We rule in the negative.

The jurisdiction of a court or tribunal over the nature and subject matter of an action is conferred by law. 30 The court or tribunal
must look at the material allegations in the complaint, the issues or questions that are the subject of the controversy, and the
character of the relief prayed for in order to determine whether the nature and subject matter of the complaint is within its
jurisdiction.31 If the issues between the parties are intertwined with the resolution of an issue within the exclusive jurisdiction of
a court or tribunal, the dispute must be addressed and resolved by the said court or tribunal.32

Section 50 of Executive Order (E.O.) No. 229 vests the DAR with quasi-judicial powers to determine and adjudicate agrarian
reform matters, as well as with exclusive original jurisdiction over all matters involving the implementation of agrarian reform.
The jurisdiction of the DAR over the adjudication of agrarian reform cases was later on delegated to the DARAB, 33 while the
former’s jurisdiction over agrarian reform implementation was assigned to its regional offices. 34

The DARAB’s New Rules of Procedure issued in 1994, which were in force at the time of the filing of the complaint, provide, in
pertinent part:

Section 1. Primary and Exclusive Original and Appellate Jurisdiction. – The Board shall have primary and exclusive jurisdiction,
both original and appellate, to determine and adjudicate all agrarian disputes involving the implementation of the
Comprehensive Agrarian Reform Program (CARP) under Republic Act No. 6657, Executive Order Nos. 228, 229 and 129-A,
Republic Act No. 3844 as amended by Republic Act No. 6389, Presidential Decree No. 27 and other agrarian laws and their
implementing rules and regulations. Specifically, such jurisdiction shall include but not be limited to cases involving the
following:

xxxx

f) Those involving the issuance, correction and cancellation of Certificates of Land Ownership Award (CLOAs) and
Emancipation Patents (EPs) which are registered with the Land Registration Authority x x x. (Emphases supplied)

Section 3(d) of Republic Act (R.A.) No. 6657 defines an agrarian dispute as
x x x any controversy relating to tenurial arrangements, whether leasehold, tenancy, stewardship or otherwise, over lands
devoted to agriculture, including disputes concerning farmworkers' associations or representation of persons in negotiating,
fixing, maintaining, changing, or seeking to arrange terms or conditions of such tenurial arrangements.

It includes any controversy relating to compensation of lands acquired under this Act and other terms and conditions of transfer
of ownership from landowners to farmworkers, tenants and other agrarian reform beneficiaries, whether the disputants stand in
the proximate relation of farm operator and beneficiary, landowner and tenant, or lessor and lessee. (Emphasis supplied)

A tenurial arrangement exists when the following are established:

1)

The parties are the landowner and the tenant or agricultural lessees;

2)

The subject matter of the relationship is an agricultural land;

3)

There is consent between the parties to the relationship;

4)

The purpose of the agricultural relationship is to bring about agricultural production;

5)

There is personal cultivation on the part of the tenant or agricultural lessees; and

6)

The harvest is shared between the landowner and the tenant or agricultural lessee. 35

Thus, the DARAB has jurisdiction over cases involving the cancellation of registered CLOAs relating to an agrarian dispute
between landowners and tenants. However, in cases concerning the cancellation of CLOAs that involve parties who are not
agricultural tenants or lessees – cases related to the administrative implementation of agrarian reform laws, rules and
regulations - the jurisdiction is with the DAR, and not the DARAB.36

Here, petitioner is correct in alleging that it is the DAR and not the DARAB that has jurisdiction.1âwphi1 First, the issue of
whether the CLOA issued to petitioners over respondent’s land should be cancelled hinges on that of whether the subject
landholding is exempt from CARP coverage by virtue of two zoning ordinances. This question involves the DAR’s determination
of whether the subject land is indeed exempt from CARP coverage – a matter involving the administrative implementation of
the CARP Law. Second, respondent’s complaint does not allege that the prayer for the cancellation of the CLOA was in
connection with an agrarian dispute. The complaint is centered on the fraudulent acts of the MARO, PARO, and the regional
director that led to the issuance of the CLOA.37

Also, the elements showing that a tenurial relationship existed between respondent and petitioners were never alleged, much
less proven. In reality, respondent only mentioned petitioners twice in his complaint. Although he admitted that they occupied
his land, he did not specify the nature of his relationship with them. He only said that their stay on his land was based on mere
tolerance.38 Furthermore, the only other instance when respondent mentioned petitioners in his complaint was when they
informed him that he could no longer harvest the fruits of the land, because they were already the owners thereof. He never
stated the circumstances that would have shown that the harvest of the fruits was in relation to a tenurial arrangement. 39

Nevertheless, assuming arguendo that the DARAB had jurisdiction, the CA was mistaken in upholding the PARAB’s Decision
that the land is industrial based on a zoning ordinance, without a prior finding on whether the ordinance had been approved by
the HLURB. We ruled in Heirs of Luna v. Afable as follows:40

The meaning of "agricultural lands" covered by the CARL was explained further by the DAR in its AO No. 1, Series of 1990,
dated 22 March 1990, entitled "Revised Rules and Regulations Governing Conversion of Private Agricultural Land to Non-
Agricultural Uses," issued pursuant to Section 49 of the CARL. Thus:

Agricultural land refers to those devoted to agricultural activity as defined in RA 6657 and not classified as mineral or forest by
the Department of Environment and Natural Resources (DENR) and its predecessor agencies, and not classified in town plans
and zoning ordinances as approved by the Housing and Land Use Regulatory Board (HLURB) and its preceding competent
authorities prior to 15 June 1988 for residential, commercial or industrial use. (Emphasis omitted)

It is clear from the last clause of the afore-quoted provision that a land is not agricultural, and therefore, outside the ambit of the
CARP if the following conditions concur:

1. the land has been classified in town plans and zoning ordinances as residential, commercial or industrial; and

2. the town plan and zoning ordinance embodying the land classification has been approved by the HLURB or its
predecessor agency prior to 15 June 1988. AIDTHC

It is undeniable that local governments have the power to reclassify agricultural into non-agricultural lands. Section 3 of RA No.
2264 (The Local Autonomy Act of 1959) specifically empowers municipal and/or city councils to adopt zoning and subdivision
ordinances or regulations in consultation with the National Planning Commission. By virtue of a zoning ordinance, the local
legislature may arrange, prescribe, define, and apportion the land within its political jurisdiction into specific uses based not only
on the present, but also on the future projection of needs. It may, therefore, be reasonably presumed that when city and
municipal boards and councils approved an ordinance delineating an area or district in their cities or municipalities as
residential, commercial, or industrial zone pursuant to the power granted to them under Section 3 of the Local Autonomy Act of
1959, they were, at the same time, reclassifying any agricultural lands within the zone for non-agricultural use; hence, ensuring
the implementation of and compliance with their zoning ordinances.

The regulation by local legislatures of land use in their respective territorial jurisdiction through zoning and reclassification is an
exercise of police power. The power to establish zones for industrial, commercial and residential uses is derived from the police
power itself and is exercised for the protection and benefit of the residents of a locality. Ordinance No. 21 of the Sangguniang
Bayan of Calapan was issued pursuant to Section 3 of the Local Autonomy Act of 1959 and is, consequently, a valid exercise
of police power by the local government of Calapan.

The second requirement — that a zoning ordinance, in order to validly reclassify land, must have been approved by the HLURB
prior to 15 June 1988 — is the result of Letter of Instructions No. 729, dated 9 August 1978. According to this issuance, local
governments are required to submit their existing land use plans, zoning ordinances, enforcement systems and procedures to
the Ministry of Human Settlements — one of the precursor agencies of the HLURB — for review and ratification. (Emphasis
supplied)

Here, the records of the case show the absence of HLURB Certifications approving Comprehensive Zoning Ordinance
Resolution No. 51-98, Series of 1982, and Zoning Ordinance No. 123, Series of 1997. Hence, it cannot be said that the land is
industrial and outside the ambit of CARP.

WHEREFORE, in view of the foregoing, the Petition dated 19 November 2009 is hereby GRANTED. The 24 September 2009
Decision of the Court of Appeals in CA-G.R. SP No. 01244-MIN is REVERSED and SET ASIDE. The 26 April 2005 Decision of
the Department of Agrarian Reform and Adjudication Board is REINSTATED.

SO ORDERED.

MARIA LOURDES P. A. SERENO

Chief Justice, Chairperson

WE COCNUR:

LUCAS P. BERSAMIN
Associate Justice

MARTIN S. VILLARAMA, JR. BIENVENIDO L. REYES

Associate Justice Associate Justice

ESTELA M. PERLAS-BERNABE
Associate Justice

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above decision had been reached in
consultation before the case was assigned to the writer of the opinion of the Court’s Division.

MARIA LOURDES P. A. SERENO

Chief Justice