Professional Documents
Culture Documents
RULINGS:
FIRST ISSUE:
YES. The Supreme Court held that Supervisory Group,
AMBALA and their respective leaders are real parties-in-interest.
The SDOA identifies the SDP qualified beneficiaries as
the farmworkers who appears in the annual payroll,
inclusive of the permanent and seasonal employees, who
are regularly or periodically employed by HLI. Galang and
the Supervisory group who were admittedly employed by HLI
comes within the definition of real party-in-interest under
Section 2, Rule 3 of the Rules of Court, as one benefited or
injured by the judgment in a suit, and thus, entitled to sue.
Assuming arguendo that they are not regular farmworkers,
Article XIII of the Constitution categorized them as other
farmworkers entitled to receive a just share of the fruits of the
land.
SECOND ISSUE:
YES. Although E0 229 expressly vested PARC with such
authority to approve plan for stock distribution, without explicitly
vesting it to revoke/recall an approved SDP, under the principle
of necessary implication, a basic postulate that what is
implied in a statute is as much a part of it as that which is
expressed. To simply state it, every statutory grant of power,
right or privilege is deemed to include all incidental power, right,
or privilege. Following the said doctrine, it may be stated that
the conferment of express power to approve SDP of agricultural
land of corporate owners necessarily includes the power to
revoke or recall the approval of the plan, for to deny PARC of
such revocation power, as in this case, would reduce it into a
toothless agency of CARP.
On a related issue, HLI claimed that subjecting the
landholding to compulsory distribution after the approval of its
SDP results in the impairment of obligation and contract, and as
such, a breach of its terms and conditions is not a PARC
administrative matter, but one that gives rise to a cause of action
cognizable by regular courts. The Supreme Court stressed that
SDOA is a special contract imbued with public interest, entered
into pursuant to RA 6657 and subject to the approval and
administrative adjudication of its issuing authorityPARC.
Contrary to the view of HLI, the rights, obligations, and
remedies of the parties to the SDOA embodying the SDP are
governed by RA 6657 and not by the Corporation Code. HLI, as
pointed by the Court was made to comply with RA 6657, and not
FOURTH ISSUE:
On the determination of the propriety of such revocation or
recall of HLIs SDP by PARC for violating the agrarian reform
policy under Sec. 2 of RA 6657, as said plan fail to enhance the
dignity and improve the quality of lives of the FWBs through
greater productivity of agricultural lands, the SC disagreed.
The SC reasoned that Section 2 of RA 6657 states that
improving the economic status of FWBs is neither among the
legal obligations of HLI under the SDP nor an imperative
imposition by RA 6657 and DAO 10, a violation of which would
justify discarding the stock distribution option. Nothing in that
option agreement, law or department order indicates otherwise.
Also SC said that its a matter of common business sense
that no corporation could guarantee a profitable run all the time.
As such being the case, SDP cannot also guarantee, as indeed
the SDOA does not guarantee, a comfortable life for the FWBs.
The onerous condition of the FWBs economic status and
hardships can hardly be attributed to HLI and its SDP and
provide a valid ground for the plans revocation.
On the Conversion of Lands
In this issue of the conversion of 500 Ha to non-agricultural
uses as an infringement of Sec. 5 (a) of DAO 10, which reads: a.
that the continued operation of the corporation with its
agricultural land intact and unfragmented is viable with potential
for growth and increased profitability, the SC said that the
PARC is wrong.
Said Sec. 5 (a) of DAO 10 does not exact from the corporate
landowner-applicant the undertaking to keep the farm intact and
unfragmented ad infinitum (forever). What is required is viability
of the corporate operations with or without its corporate land
remaining intact or unfragmented.
On the 3% Production Share
On the matter of whether HLI complied with its undertaking
to give 3% shares of the gross production sales of the land, the
SC ruled that the Special Task Force was silent as to whether
HLI has failed to comply with the 3% production-sharing
obligation or the 3% of the gross selling price of the converted
land and the SCTEX lot, since some FWBs admits to have
received their share in the gross production of the sales and in
the sale of SCTEX lot while the others claimed otherwise. The
Court found this as a slight breach that would not justify
rescission of the contract.
On Titles to Homelots
Under RA 6657, the distribution of homelots is required
only for corporations or other business associations owning or
operating farms which opted for land distribution, and not for
corporations which opted for stock distribution under Sec. 31 of
RA 6657. Concomitantly, said corporation are not obliged to
provide it, EXCEPT by stipulation, as in this case.
Under the SDP, HLI subdivided and allocated for free to
qualified family-beneficiaries 240 sq. m. homelots in the barrio or
barangay where they actually reside. The Court opined that 16
years have elapse from the time the SDP was approved by PARC,
and yet FWBs alleged that not all were afforded homelots.
Hence, SC ruled that HLI has not yet fully complied with its
undertaking to distribute homelots to FWBs under the SDP.
On Man Days and the Mechanics of Stock Distribution
The SC found that the SDOA violated two provisions of DAO
10.
In Par. 3 of the SDOA, the distribution of the shares of stock to
the FWBs is contigent on the number of days FWBs have worked
during the year. This deviates from Sec. 4, DAO 10, which
decrees the distribution of equal number of shares to the FWBs
as the minimum ratio of shares of stock for purposes of
compliance with Section 21 of RA 6657.
Accordingly, Section 4 of DAO 10 gives two sets of shares of
stocks which a qualified beneficiary can acquire from the
corporation under the SDP. The first one is the mandatory ratio
of equal number of shares of stocks to be distributed to the
FWBs which contemplates proportion of the capital stock of
the corporation that the agricultural land, actually devoted
to agricultural activities, bears in relation to the
companys total asset.
The second partakes a gratuitous extra grant or an
augmentation share/s that the corporate landowner may give
effectively
nullifying
the