Department of Agrarian Reform, represented by

Secretary Jose Mari B. Ponce (OIC)

vs
Delia T. Sutton, Ella T. Sutton-Soliman and Harry T.
Sutton
G.R. No.162070

recommended to the DAR Secretary that it be

exempted from the coverage of the CARL.

On April 27, 1993, respondents reiterated to

petitioner DAR the withdrawal of their VOS and
requested the return of the supporting papers
they submitted in connection therewith.
Petitioner ignored such request.

On December 27, 1993, DAR issued A.O. No. 9,

series of 1993, which provided that only portions
of private agricultural lands used for the raising
of livestock, poultry and swine as of June 15,
1988 shall be excluded from the coverage of the
CARL. In determining the area of land to be
excluded, the A.O. fixed the following retention
limits, viz.: 1:1 animal-land ratio and a ratio of
1.7815 hectares for livestock infrastructure for
every 21 heads of cattle shall likewise be
excluded from the operations of the CARL.

On February 4, 1994, respondents wrote the

DAR Secretary and advised him to consider as
final and irrevocable the withdrawal of their VOS
as, under the Luz Farms doctrine, their entire
landholding is exempted from the CARL.

On September 14, 1995, then DAR Secretary

Ernesto D. Garilao issued an Order partially
granting the application of respondents for
exemption from the coverage of CARL. Applying
the retention limits outlined in the DAR A.O. No.
9, petitioner exempted 1,209 hectares of
respondents' land for grazing purposes, and a
maximum
of
102.5635
hectares
for
infrastructure. Petitioner ordered the rest of
respondents' landholding to be segregated and
placed under Compulsory Acquisition.

Respondents moved for reconsideration,

contending that their entire landholding should
be exempted as it is devoted exclusively to
cattle-raising. Said motion was denied.
Respondents filed a notice of appeal with the
Office of the President assailing: (1) the
reasonableness and validity of DAR A.O. No. 9,
s. 1993, which provided for a ratio between land
and livestock in determining the land area
qualified for exclusion from the CARL, and (2)
the constitutionality of DAR A.O. No. 9, s. 1993,
in view of the Luz Farms case which declared
cattle-raising lands excluded from the coverage
of agrarian reform. The OP affirmed the

Facts:

This is a petition for review filed by the

Department of Agrarian Reform (DAR) of the
Decision and Resolution of the Court of Appeals,
dated September 19, 2003 and February 4,
2004, respectively, which declared DAR
Administrative Order (A.O.) No. 9, series of
1993, null and void for being violative of the
Constitution.

The case involves a land in Aroroy, Masbate,

inherited by respondents which has been
devoted exclusively to cow and calf breeding.
On October 26, 1987, pursuant to the then
existing agrarian reform program of the
government, respondents made a voluntary offer
to sell (VOS) their landholdings to petitioner
DAR to avail of certain incentives under the law.

On June 10, 1988, a new agrarian law, Republic

Act (R.A.) No. 6657, also known as the
Comprehensive Agrarian Reform Law (CARL) of
1988, took effect. It included in its coverage
farms used for raising livestock, poultry and
swine.

On December 4, 1990, in an en banc decision in

the case of Luz Farms v. Secretary of DAR, the
Court ruled that lands devoted to livestock and
poultry-raising are not included in the definition
of agricultural land and declared as
unconstitutional certain provisions of the CARL
insofar as they included livestock farms in the
coverage of agrarian reform. In view of this,
respondents filed with petitioner DAR a formal
request to withdraw their VOS as their
landholding was devoted exclusively to cattleraising and thus exempted from the coverage of
the CARL.

On December 21, 1992, the Municipal Agrarian

Reform Officer of Aroroy, Masbate, inspected
respondents' land and found that it was devoted
solely to cattle-raising and breeding. He

impugned order. On appeal to CA, the CA ruled

in favor of respondents and declared A.O. No. 9,
Series of 1993 as void.

earlier one. In the case at bar, after the passage

of the 1988 CARL, Congress enacted R.A. No.
7881 which amended certain provisions of the
CARL. Specifically, the new law changed the
definition of the terms "agricultural activity" and
"commercial farming" by dropping from its
coverage lands that are devoted to commercial
livestock, poultry and swine-raising. With this
significant modification, Congress clearly sought
to align the provisions of our agrarian laws with
the intent of the 1987 Constitutional Commission
to exclude livestock farms from the coverage of
agrarian reform.

Issue:

Whether or not DAR Administrative Order No.

09, Series of 1993 which prescribes a maximum
retention for owners of lands devoted to
livestock raising is constitutional?

Held:

The impugned A.O. is invalid as it contravenes

the Constitution. The A.O. sought to regulate
livestock farms by including them in the
coverage of agrarian reform and prescribing a
maximum retention limit for their ownership.
However, the deliberations of the 1987
Constitutional Commission show a clear intent to
exclude, inter alia, all lands exclusively devoted
to livestock, swine and poultry-raising. The Court
clarified in the Luz Farms case that livestock,
swine and poultry-raising are industrial activities
and do not fall within the definition of
"agriculture" or "agricultural activity." The raising
of livestock, swine and poultry is different from
crop or tree farming. It is an industrial, not an
agricultural, activity. A great portion of the
investment in this enterprise is in the form of
industrial fixed assets, such as: animal housing
structures and facilities, drainage, waterers and
blowers, feedmill with grinders, mixers,
conveyors, exhausts and generators, extensive
warehousing facilities for feeds and other
supplies, anti-pollution equipment like bio-gas
and digester plants augmented by lagoons and
concrete ponds, deepwells, elevated water
tanks, pumphouses, sprayers, and other
technological appurtenance.

Petitioner DAR has no power to regulate

livestock farms which have been exempted by
the Constitution from the coverage of agrarian
reform. It has exceeded its power in issuing the
assailed A.O.

Moreover, it is a fundamental rule of statutory

construction that the reenactment of a statute by
Congress without substantial change is an
implied legislative approval and adoption of the
previous law. On the other hand, by making a
new law, Congress seeks to supersede an

It is doctrinal that rules of administrative bodies

must be in harmony with the provisions of the
Constitution. They cannot amend or extend the
Constitution. To be valid, they must conform to
and be consistent with the Constitution. In case
of conflict between an administrative order and
the provisions of the Constitution, the latter
prevails. The assailed A.O. of petitioner DAR
was properly stricken down as unconstitutional
as it enlarges the coverage of agrarian reform
beyond the scope intended by the 1987
Constitution.

CASTILLO v. TOLENTINO, G.R. No. 181525, March 4,

2009
Tolentino was the owner of two parcels of land and a
caretaker of another. The said parcels were tenanted by
Castillo who promised to remit lease rentals to Tolentino.
Castillo wrote the PARO informing the latter of his
intention to construct a water reservoir. Tolentino also
received a copy of the letter and opposed the same.
Despite this, Castillo proceeded with the construction of
the water dike. Tolentino filed a case for ejectment.
PARAD ruled for the ejectment of Castillo. DARAB
initially affirmed the Decision but reversed itself in a
Motion for Reconsideration. CA reinstated the Decision
of the PARAD since it held that the appeal was filed out
of time.
1.
OBLIGATIONS OF A TENANT WITH RESPECT
TO CONSTRUCTION OF IMPROVEMENTS ON THE
LANDHOLDING
Section 32 of R.A. No. 3844 specifically requires
notice to and consent of the agricultural lessor
before the agricultural lessee may embark upon

the construction of a permanent irrigation system.

It is only when the former refuses to bear the
expenses of construction that the latter may
choose to shoulder the same. More importantly,
any change in the use of tillable land in the
leasehold, e.g. through the construction of a
sizeable water reservoir, impacts upon the
agricultural lessor's share in the harvest, which is
the only consideration he receives under the
agrarian law. This being the case, before the
agricultural lessee may use the leasehold for a
purpose other than what had been agreed upon,
the consent of the agricultural lessor must be
obtained, lest he be dispossessed of his
leasehold.
The law (Sec. 32 of R.A. No. 3844) does not give
blanket authority to the agricultural lessee to
construct an irrigation system at anytime and for
any reason; instead, it presupposes primarily that
the same is necessary.
2.

IMPLIED OBLIGATION OF A TENANT

The fact that CASTILLO was convicted by final
judgment of an offense against TOLENTINO's
son, George, demonstrates how relations
between the two have deteriorated. While R.A.
No. 3844 authorizes termination by the
agricultural lessee of the lease for a crime
committed by the agricultural lessor against the
former or any member of his immediate farm
household, the same privilege is not granted to
the agricultural lessor. Yet, this does not mean
that the courts should not take into account the
circumstance that the agricultural lessee
committed a crime against the agricultural lessor
or any member of his immediate family. By
committing a crime against TOLENTINO's son,
CASTILLO violated his obligation to his lessor to
act with justice, give everyone his due, and
observe honesty and good faith, an obligation that
is deemed included in his leasehold agreement.
Provisions of existing laws form part of and are
read into every contract without need for the
parties expressly making reference to them.

3.
VIOLATION OF OBLIGATION OF A TENANT
GROUND FOR DISPOSSESSION
In sum, we hold that the construction of the
reservoir constitutes a violation of Section 36 of
R.A. No. 3844, an unauthorized use of the
landholding for a purpose other than what had

been agreed upon, and a violation of the

leasehold contract between CASTILLO and
TOLENTINO, for which the former is hereby
penalized with permanent dispossession of his
leasehold. SEAHcT
4.

SOCIAL JUSTICE POLICY

Citing Bautista v. Mag-isa, G.R. No. 152564,
September 13, 2004, 438 SCRA 259; Gonzales v.
Court of Appeals, G.R. No. 110335, June 18,
2001, 358 SCRA 598:
Agrarian laws were enacted to help small farmers
uplift their economic status by providing them with
a modest standard of living sufficient to meet their
needs for food, clothing, shelter and other basic
necessities. It provides the answer to the urgent
need to alleviate the lives of the vast number of
poor farmers in our country. Yet, despite such
laws, the majority of these farmers still live on a
hand-to-mouth existence. This can be attributed
to the fact that these agrarian laws have never
really been effectively implemented. Certain
individuals have continued to prey on the
disadvantaged, and as a result, the farmers who
are intended to be protected and uplifted by the
said laws find themselves back in their previous
plight or even in a more distressing situation.
Citing De Jesus v. Intermediate Appellate Court,
G.R. No. 72282, July 24, 1989, 175 SCRA 559:
R.A. No. 3844, or the Agricultural Land Reform
Code, was enacted by Congress to institute land
reforms in the Philippines. It was passed to
establish owner-cultivatorship and the family size
farm as the basis of Philippine agriculture; to
achieve a dignified existence for the small farmers
free from pernicious industrial restraints and
practices; as well as to make the small farmers
more independent, self-reliant and responsible
citizens and a source of genuine strength in our
democratic society.
R.A. 3844 and R.A. 6389, being social
legislations, are designed to promote economic
and social stability and must be interpreted
liberally to give full force and effect to their clear
intent, not only in favor of the tenant-farmers but
also of landowners.

5.
SOCIAL JUSTICE POLICY NOT INTENDED
TO COUNTENANCE WRONGDOING

We cannot allow a situation where despite the

one-sided nature of the law governing agricultural
leasehold tenancy (R.A. No. 3844), which
exceedingly favors the agricultural lessee/tenant
and farmworker the agricultural lessee has
shown lack of courtesy to the landowner and,
instead, abused his rights under said law, at the
same time neglecting or willfully refusing to take
advantage of his rights under the comprehensive
agrarian reform law which would have otherwise
fulfilled its mandate to provide land for the
landless. The primary purpose, precisely, of
agrarian reform is the redistribution of lands to
farmers and regular farmworkers who are
landless, irrespective of tenurial arrangement.
The law recognizes and condones that a
leasehold tenant may have his own land while he
tills that of another, but certainly we cannot see
any justification why a tenant should give away for
free and sell his own agricultural land until nothing
is left, and then insist himself on someone else's
without giving the landowner the proper
respect and regard that is due him, acting
presumptuously and beyond his stature as mere
agricultural lessee.

DCN 3362
Leoncio Yatco was the owner of a 4.2 hectare parcel of
land which was tenanted by Francisco and his son
Hernando Levardo. F. Levardo likewise executed a
similar Pinanumpaang Salaysay waiving his rights as
tenant. F. Levardo received 2.4M as disturbance
compensation. L. Yatco thereafter sold the landholding to
Gonzalo Puyat and Sons. The Levardos filed a
complaint for the declaration of nullity of the Deed of
Donation, Deed of Sale and the waiver of rights.
In both cases, the plaintiffs grounded their causes of
action on the claim that the land in dispute was covered
by Operation Land Transfer (OLT) pursuant to
Presidential Decree No. 27 (P.D. No. 27). They contend
that they were already deemed the owners of the land
on the basis of an alleged Certificate of Land Transfer
(CLT) in the name of their father Aguido, which was
never issued by the DAR, but on the basis of an alleged
certified xerox copy of a Masterlist of tenants wherein his
name appeared.
1.

PD 27 COVERAGE
P.D. No. 27 should be read in conjunction with
Letter of Instruction No. 474 (LOI No. 474) and
the DAR Memorandum on the "Interim Guidelines
on Retention by Small Landowners" dated July
10, 1975 (DAR Memorandum). The pertinent
portion of LOI No. 474 is as follows:

Citing Cecilleville Realty and Service Corp. v.

Court of Appeals, G.R. No. 120363, September 5,
1997, 278 SCRA 819:
The policy of social justice is not intended to
countenance wrongdoing simply because it is
committed by the underprivileged. Compassion
for the poor is an imperative of every humane
society but only when the recipient is not a rascal
claiming an undeserved privilege.

1.
You shall undertake to place the Land
Transfer Program of the government pursuant to
Presidential Decree No. 27, all tenanted rice/corn
lands with areas of seven hectares or less
belonging to landowners who own other
agricultural lands of more than seven hectares in
aggregate areas or lands used for residential,
commercial, industrial or other urban purposes
from which they derive adequate income to
support themselves and their families. (Emphasis
and underscoring supplied)

REYNALDO v. YATCO, G.R. No. 165494, March 20,

2009
DCN 3361
Belizario was the owner of a 4.3 hectare parcel of land
which she donated to Tomas Yatco as evidence by a
Deed of Donation inter vivos. Said land was tenanted by
Aguido
Levardo
who
subsequently
executed
a Pinanumpaang Salaysay signed by him and his
children, waiving his rights as tenant. A. Levardo
received 2M as disturbance compensation. T. Yatco sold
the landholding to Gonzalo Puyat and Sons. The
Levardos filed a complaint for the declaration of nullity of
the Deed of Donation, Deed of Sale and the waiver of
rights.

The pertinent portion of the DAR Memorandum is

as follows:
xxx

xxx

xxx

5.
Tenanted rice and/or corn lands seven (7)
hectares or less shall not be covered by
Operation Land Transfer. The relation of the land
owner and tenant-farmers in these areas shall be
leasehold . . . (Emphasis supplied)

Based on the foregoing, it is clear that the lands in

dispute do not fall under the coverage of P.D. No.
27. The DAR Memorandum is categorical that
lands with seven hectares or less shall not be
covered by OLT.
2.
TERMINATION OF LEASEHOLD BY PAYMENT
OF DISTURBANCE COMPENSATION
Based on the evidence on record, respondents
paid Aguido P2,000,000.00 and Hernando
P2,417,142.00 as disturbance compensation. A
reading of the Pinanumpaang Salaysay executed
by petitioners show that they gave up their
leasehold rights"dahil sa aming kagustuhang
umiba ng hanap buhay ng higit ang pagkikitaan
kaysa panakahan." The money given by
respondents as disturbance compensation was
indeed advantageous to the families of

petitioners, as it would have allowed them to

pursue other sources of livelihood.
3.
CERTIFICATE
EFFECT

OF

LAND

TRANSFER

Citing Pagtalunan v. Tamayo, G.R. No. 54281,

March 19, 1990, 183 SCRA 252:
Moreover, assuming arguendo that CLTs
were actually issued to petitioners, a CLT
does not vest in the farmer/grantee
ownership of the land described therein. At
most, the CLT merely evidences the
government's recognition of the grantee as
partly qualified to await the statutory
mechanism for the acquisition of ownership
of the land titled by him as provided in P.D.
No. 27. Neither is this recognition
permanent or irrevocable.