Caylao, Inna Marie S.

2D

HACIENDA LUISITA, INCORPORATED et al. v. PRESIDENTIAL AGRARIAN REFORM

COUNCIL et al.
G.R. No. 171101, 22 November 2011, En Banc (Velasco, Jr., J.)

On July 5, 2011, the Court promulgated a Decision denying the petition filed by HLI and
affirming Presidential Agrarian Reform Council (PARC) Resolution with the modification that the
original 6,296 qualified farmworker-beneficiaries of Hacienda Luisita (FWBs) shall have the
option to remain as stockholders of HLI and thus, placing the subject lands in Hacienda Luisita
under compulsory coverage of the Comprehensive Agrarian Reform Program (CARP) of the
government.

On the other hand, the Court declared that the revocation of the SDP must, by
application of the operative fact principle, give way to the right of the original 6,296 qualified
farmworkers-beneficiaries (FWBs)to choose whether they want to remain as HLI stockholders or
[choose actual land distribution]. It thus ordered the Department of Agrarian Reform (DAR) to
immediately schedule meetings with the said 6,296 FWBs and explain to them the effects,
consequences and legal or practical implications of their choice, after which the FWBs will be
asked to manifest, in secret voting, their choices in the ballot, signing their signatures or placing
their thumbmarks, as the case may be, over their printed names.

The parties thereafter filed their respective motions for reconsideration of the Court
decision.

ISSUE:

Whether or not the 10-year period prohibition on the transfer of awarded lands under RA
6657 lapsed on May 10, 1999 (since Hacienda Luisita were placed under CARP coverage
through the Stock Distribution Option Agreement (SDOA) scheme on May 11, 1989); hence, the
qualified FWBs should now be allowed to sell their land interests in Hacienda Luisita to third
parties.

HELD:

No. The Court held that under RA 6657 and DAO 1, the awarded lands may only be
transferred or conveyed after ten (10) years from the issuance and registration of the
emancipation patent (EP) or certificate of land ownership award (CLOA). Considering that the
EPs or CLOAs have not yet been issued to the qualified FWBs in the instant case, the 10-year
prohibitive period has not even started. Significantly, the reckoning point is the issuance of the
EP or CLOA, and not the placing of the agricultural lands under CARP coverage.

The ruling in the July 5, 2011 Decision that the qualified FWBs be given an option to
remain as stockholders of HLI should be reconsidered.
ROSALINA BONIFACIO et al. vs. HON. NATIVIDAD G. DIZON and PASTORA SAN MIGUEL
G.R. No. 79416, 5 September 1989, Third Division (Fernan, C.J.)

The favorable judgment adverted to by petitioners traces its origin to the complaint filed
by Olimpio Bonifacio before the then Court of Agrarian Relations, Fifth Regional District, Branch
I-A of Baliwag, Bulacan, seeking the ejectment of private respondent Pastora San Miguel from
Bonifacio's two-hectare agricultural land situated at Patubig, Marilao, Bulacan. The ground
relied upon therefore was personal cultivation under Section 36 (1) of R.A. 3844, otherwise
known as the Agricultural Land Reform Code.

Petitioners contend that respondent judge committed grave abuse of discretion

tantamount to lack of jurisdiction in ruling that the decision in CAR Case No. 2160-B'68 can no
longer be executed as said action is purely personal in character and therefore cannot, upon
Olimpio Bonifacio's death, be inherited by his heirs. They assert that CAR Case No. 2160-B'68,
being an ejectment case and not one of those specifically provided by law to be purely personal,
survives the death of a party. Furthermore, as under Rule 39, Section 49 (b) of the Rules of
Court, a judgment is binding not only upon the parties but also on their successors-in-interest,
petitioners are entitled to enforce the decision in CAR Case No. 2160-B'68.

ISSUE:
Whether or not the right of cultivation as a ground for ejectment was a right exclusive
and personal to the landowner-lessor.

HELD:
No. The Court held that Under section 36 (1), R.A. 384, ejectment of an agricultural
lessee was authorized not only when the landowner-lessor desired to cultivate the landholding,
but also when a member of his immediate family so desired. In so providing, the law clearly did
not intend to limit the right of cultivation strictly and personally to the landowner but to extend
the exercise of such right to the members of his immediate family. Clearly then, the right of
cultivation as a ground for ejectment was not a right exclusive and personal to the landowner-
lessor. To say otherwise would be to put to naught the right of cultivation likewise conferred
upon the landowner's immediate family members.

The right of cultivation was extended to the landowner's immediate family members
evidently to place the landowner-lessor in parity with the agricultural lessee who was (and still
is) allowed to cultivate the land with the aid of his farm household. In this regard, it must be
observed that an agricultural lessee who cultivates the landholding with the aid of his immediate
farm household is within the contemplation of the law engaged in "personal cultivation."

Thus, whether used in reference to the agricultural lessor or lessee, the term "personal
cultivation" cannot be given a restricted connotation to mean a right personal and exclusive to
either lessor or lessee. In either case, the right extends to the members of the lessor's or
lessee's immediate family members.

Petitioners are not only the heirs and successors-in-interest, but the immediate family
members of the deceased landowner-lessor as well. The right to cultivate the landholding
asserted in CAR Case No. 2160-B'68 not being a purely personal right of the deceased
landowner-lessor, the same was transmitted to petitioners as heirs and successors-in-interest.
Petitioners are entitled to the enforcement of the judgment in CAR Case No. 2160-B'68.

CELSO PAGTALUNAN and PAULINA P. PAGTALUNAN vs.HON. ROQUE A. TAMAYO et al.

G.R. No. L-5428, 19 March 1990, Third Division (Cortes, J.)

In the present case, the State in the exercise of its sovereign power of eminent domain
has decided to exprpriate the subject property for public use as a permanent site for the
Bulacan Area Shop of the Department of Public Works and Highways.

On the other hand, petitioners contend that they are entitled for just compensation
based on Certificate of Land Transfer No. NS-054560 issued to them, where the tenant
farmer/grantee is "deemed owner" of the agricultural land identified therein. Petitioners contend
that the certificate is a muniment of title evidencing their legal ownership of a portion of the
subject property. Thus, they conclude that they are entitled to a portion of the proceeds from the
expropriation proceedings instituted over the subject property.

However, petitioners have not been issued an emancipation patent. Furthermore, they
do not dispute private respondents' allegation that they have not complied with the conditions
enumerated in their certificate of land transfer which would entitle them to a patent. In fact,
petitioners do not even claim that they had remitted to private respondents, through the Land
Bank of the Philippines, even a single amortization payment for the purchase of the subject
property.

ISSUE:
Whether or not the petitioners have the right to intervene in the expropriation
proceedings instituted by the State against private respondents as registered owner of the
subject property.

HELD:
No. Under Pres. Decree No. 266 which specifies the procedure for the registration of title
to lands acquired under Pres. Decree No. 27, full compliance by the grantee with the
abovementioned undertakings is required for a grant of title under the Tenant Emancipation
Decree and the subsequent issuance of an emancipation patent in favor of the farmer/grantee
[Section 2, Pres. Decree No. 226]. It is the emancipation patent which constitutes conclusive
authority for the issuance of an Original Certificate of Transfer, or a Transfer Certificate of Title,
in the name of the grantee. Clearly, it is only after compliance with the above conditions which
entitle a farmer/grantee to an emancipation patent that he acquires the vested right of absolute
ownership in the landholding a right which has become fixed and established, and is no
longer open to doubt or controversy At best, the farmer/grantee, prior to compliance with these
conditions, merely possesses a contingent or expectant right of ownership over the landholding.

The mere issuance of the certificate of land transfer does not vest in the farmer/grantee
ownership of the land described therein. The certificate simply evidences the government's
recognition of the grantee as the party qualified to avail of the statutory mechanisms for the
acquisition of ownership of the land tilled by him as provided under Pres. Decree No. 27.
Neither is this recognition permanent nor irrevocable. Failure on the part of the farmer/grantee
to comply with his obligation to pay his lease rentals or amortization payments when they fall
 due for a period of two (2) years to the landowner or agricultural lessor is a ground for forfeiture
of his certificate of land transfer [Section 2, Pres. Decree No. 816].

VICTOR TALAVERA and VISITACION AGUSTIN TALAVERA, v. HON. COURT OF APPEALS and
JOSE LAXAMANA
G.R. No. 77830, 27 February 1990, Third Division (Gutierrez, Jr., J.)

An action for recovery of possession was instituted by the private respondent Laxamana
against the petitioners over a parcel of agricultural land with an area of 21,081 square meters
located at Brgy. Sto. Domingo 11, Sitio Tambo, Capas, Tarlac. Respondent Laxamana alleged
that he had been a bonafide tenant of the aforesaid parcel of land since 1958 until the
petitioners took possession thereof sometime in 1984.

On the other hand, the petitioners counter-alleged, among others, that their tenancy
relationship with respondent Laxamana was terminated pursuant to a document captioned
"Casunduan" executed on March 30, 1973 whereby the latter sold his rights and interests over
the agricultural landholding under litigation for a consideration of P1,000.00; that respondent
Laxamana was not actually a tenant of the petitioners and whatever tenancy rights the former
had exercised over the landholding in question were voluntarily surrendered by him upon the
execution of the aforesaid document.

RTC ruled in favor of Laxamana. CA affirmed the RTCs holding that the Casunduan
even if assumed to be valid did not constitute "voluntary surrender" as contemplated by law,
hence, respondent Laxamana ought to be reinstated as tenant of the petitioners' landholding.

ISSUE:
Whether or not the Court of Appeals committed reversible error in its finding that there
was no voluntary surrender of the landholding in question on the part of respondent Laxamana
as tenant.

HELD:
No. The Court held that voluntary surrender, as a mode of extinguishment of tenancy
relations, does not require any court authorization considering that it involves the tenant's own
volition.]). To protect the tenant's right to security of tenure, voluntary surrender, as
contemplated by law, must be convincingly and sufficiently proved by competent evidence. The
tenant's intention to surrender the landholding cannot be presumed, much less determined by
mere implication. Otherwise, the right of a tenant to security of tenure becomes an illusory one.

Tenancy relations cannot be bargained away except for the strong reasons provided by
law which must be convincingly shown by evidence in line with the State's policy of achieving a
dignified existence for the small farmers free from pernicious institutional restraints and
practices (Sec. 2 [2], Code of Agrarian Reforms).
RAMON A. GONZALES vs. LAND BANK OF THE PHILIPPINES and COURT OF APPEALS
G.R. No. 76759 March 22, 1990, Third Division (Fernan, C.J.)

On the strength of a Deed of Assignment executed on August 8, 1981 by Ramos

Plantation Company, Inc. (hereafter referred to as the corporation) through its president, Antonio
Vic Zulueta, assigning its rights under Land Transfer Claim No. 82-757 unto petitioner Ramon A.
Gonzales, the latter filed an action before the Regional Trial Court to compel public respondent
Land Bank of the Philippines to issue Land Bank Bonds for the amount of P400,000.00 in the
name of petitioner instead of in the name of the aforesaid corporation as the original and
registered owner of the property covered by Transfer Certificate of Title No. T-28750 situated in
La Suerte, Malang, North Cotabato with a total area of 251.4300 hectares, which had been
brought under the land transfer program of the government.
The lower court found the plaintiff entitled to the issuance of the Land Bank bonds. CA
reversed RTCs decision and in effect denying the direct issuance of Land Bank bonds in the
name of herein petitioner as assignee thereof.

ISSUE:
Whether or not the respondent Land Bank can be compelled to issue Land Bank bonds
in the name of petitioner by virtue of the Deed of Assignment executed by the landowner-
assignor Ramos Plantation Company, Inc. in favor of petitioner.

HELD:
No. There is indeed no question that petitioner stepped into the shoes of his assignor,
the defendant corporation. But petitioner overlooked the fact that when the corporation assigned
its rights to him under Land Transfer Claim No. 82-757, the same was subject to the rules and
restrictions imposed by respondent Land Bank on the matter of assignment of rights.
In the promulgation of said rules and regulations, the Land Bank relied on the provisions of
Section 76, R.A. 3844 as amended by P.D. 251, which specifically provides:

Sec. 76. Issuance of Bonds. . . . The Board of Directors shall have the power to
prescribe rules and regulations for the issuance, reissuance, servicing,
placement and redemption of the bonds herein authorized to be issued as well as
the registration of such bonds at the request of the holders thereof.

The act of assignment could not operate to erase liens or restrictions burdening the right
assigned. The assignee cannot, after all, acquire a greater right than that pertaining to the
assignor.
GRACIANO BERNAS vs. THE HONORABLE COURT OF APPEALS and NATIVIDAD BITO-ON DEITA
G.R. No. 85041, 5 August 1993, En Banc (Padilla, J.)

Natividad Bito-on Deita is the owner of Lots Nos. 794, 801, 840 and 848 of the Cadastral
Survey of Panay, Capiz, with a total area of 5,831 square meters. Out of liberality, Natividad
entrusted the lots by way of "dugo" to her brother, Benigno Bito-on, so that he could use the
fruits thereof to defray the cost of financing his children's schooling in Manila. Prior to April 1978,
these agricultural lots had been leased by one Anselmo Billones but following the latter's death
and consequent termination of the lease, petitioner Graciano Bernas took over and worked on
the land. Benigno and Bernas worked out a production-sharing arrangement whereby the first
provided for all the expenses and the second worked the land, and after harvest, the two (2)
deducted said expenses and divided the balance of the harvest between the two of them. The
owner, Natividad, played no part in this arrangement as she was not privy to the same.

In 1985, the lots were returned by Benigno to his sister Natividad, as all his children had
by then finished their schooling. When Natividad, and her husband sought to take over
possession of the lots, Bernas refused to relinquish, claiming that he was an agricultural
leasehold lessee instituted on the land, by Benigno and, as such, he is entitled to security of
tenure under the law.

ISSUE:
Whether or not the agricultural leasehold established by Benigno Bito-on in favor of
Graciano Bernas is binding upon the owner of the land, Natividad Bito-on, who disclaims any
knowledge of, or participation in the same.

HELD:
Yes. The Court held that a legal possessor may lease the property by way of agricultural
leasehold. There is no dispute, as it is admitted by the parties in this case, that Benigno Bito-on
was granted possession of the property in question by reason of the liberality of his sister,
Natividad (the private respondent). In short, he (Benigno) was the LEGAL POSSESSOR of the
property and, as such, he had the authority and capacity to enter into an agricultural leasehold
relation with Bernas. Consequently, there is no need to dwell on the contentions of the private
respondent that, her brother Benigno was not a usufructuary of the property but actually a bailee
incommodatum. Whatever was the true nature of his designation, he (Benigno) was the LEGAL
POSSESSOR of the property and the law expressly grants him, as legal possessor, authority
and capacity to institute an agricultural leasehold lessee on the property he legally possessed.

There was, as admitted by all, no privity or tie between Natividad and Bernas. Therefore,
even if Bernas had improperly used the lots as ricelands, it was Benigno who could have
objected thereto since it was his (the legal possessor's) landholding that was being "improperly"
used. But he (Benigno) did not. It is not for Natividad (as landowner) to now complain that
Bernas used the land "for a purpose other than what had been previously agreed upon." Bernas
had no agreement with her as to the purpose for which the land was to be used. That they were
converted into ricelands (also for agricultural production) can only mean that the same
(conversion) was approved by Benigno (the undisputed agricultural lessor-legal possessor). It is
thus clear that sec. 36, par 3 of the Code cannot be used to eject Bernas.

Clearly the return of legal possession from Benigno to Natividad cannot prejudice the
rights of Bernas as an agricultural leasehold lessee. The grounds for ejectment of an agricultural
leasehold lessee are provided for by law. The enumeration is exclusive and no other grounds
can justify termination of the lease. The policy and letter of the law are clear on this point.
POLICARPIO NISNISAN AND ERLINDA NISNISAN, vs. COURT OF APPEALS et al.
G.R. No. 126425, 12 August 1998, Second Division (Martinez, J.)

Spouses Gavino and Florencia Nisnisan are the owners of a parcel of land denominated as
Lot No. 2510, Cad 275 located at Dolo, Bansalan, Davao del Sur, with an area of 4.9774
hectares, covered by Original Certificate of Title No. (P-11676)-2151. Petitioner Policarpio
Nisnisan, son of Gavino Nisnisan, has been cultivating one hectare of the aforesaid land since
1961.

On April 1, 1976, Gavino Nisnisan and petitioner Policarpio Nisnisan entered into a
leasehold tenancy contractwhich stipulates a sharing arrangement of 1/3:2/3 of the harvest, the
bigger share being given to the latter.

On December 28, 1978, Gavino Nisnisan sold two hectares of their land, including the land
tenanted by petitioners-spouses Policarpio and Erlinda Nisnisan, to private respondents-
spouses Wenceslao Mancera and Pacita H. Mancera.

As a result of the sale, petitioners-spouses were ousted from their landholding. Petitioners
then filed a complaint for reinstatement of tenancy holding filed against private respondents
spouses Pacita Mancera and Wenceslao Mancera. However, RTC and CA dismissed said
complaint.

ISSUE:
Whether or not petitioners Spouses Policarpio and Erlinda Nisnisan voluntarily
surrendered their tenancy holding.

HELD:
No. The Court held that voluntary surrender, as a mode of extinguishing agricultural
leasehold tenancy relations, must be convincingly and sufficiently proved by competent
evidence. Private respondents failed to present any evidence to show that petitioners-spouses
surrendered their landholding voluntarily after the private respondents purchased the subject
property. Moreover, the filing of the complaint for reinstatement of leasehold tenancy by
petitioners-spouses against private respondents before the CAR militates against the private
respondents claim that petitioners-spouses voluntarily surrendered their landholding to them.

Based on the foregoing disquisition, it is clear that petitioners-spouses are agricultural

lessees and are therefore entitled to security of tenure as mandated by Section 10 of Republic
Act 3844:

Section 10. Agricultural Leasehold Relation Not Extinguished by Expiration of

Period, etc.- The agricultural leasehold relation under this Code shall not be
extinguished by mere expiration of the term or period in a leasehold contract nor
by the sale, alienation or transfer of the legal possession of the landholding. In
case the agricultural lessor sells, alienates or transfers the legal
 possession of the landholdings, the purchaser or transferee thereof shall
be subrogated to the rights and substituted to the obligations of the
agricultural lessor.

Thus, the agricultural leasehold relation cannot be extinguished by the mere expiration of
the term or period in an agricultural leasehold contract nor by the sale, alienation or transfer of
the legal possession of the landholding. He can only be ejected for cause, which, however, is
absent in the case at bar.

CECILLEVILLE REALTY and SERVICE CORPORATION vs., THE COURT OF APPEALS and
HERMINIGILDO PASCUAL
G.R. No. 120363, 5 September 1997, Third Division (Francisco, J.)

Petitioner Cecilleville Realty and Service Corporation is the owner of a parcel of land in
Catmon, Sta. Maria, Bulacan, covered by T.C.T. No. 86.494 (M). Private respondent
Herminigildo Pascual occupies a portion thereof. Despite repeated demands, private
respondent refused to vacate and insisted that he is entitled to occupy the land since he is
helping his mother Ana Pascual, petitioners tenant, to cultivate the land in
question. Thenceforth, petitioner instituted an ejectment suit against private respondent before
the Municipal Trial Court of Sta. Maria, Bulacan. MTC directed the the private respondent
Herminigildo Pascual to vacate the portion of the landholding he occupies . RTC and CA ruled
in favor of private respondent.

ISSUE:
Whether or not the Court of Appeals erred in not finding that while the private respondent
is entitled to work on the agricultural land of petitioner in his capacity as member of the family of
tenant Ana Pascual, nonetheless he cannot occupy a substantial portion thereof and utilize the
same for residential purposes.

HELD:

Yes. As clearly provided, only a tenant is granted the right to have a home lot and the
right to construct or maintain a house thereon. And here, private respondent does not dispute
that he is not petitioners tenant. In fact, he admits that he is a mere member of Ana Pascuals
immediate farm household. Under the law, therefore, we find private respondent not entitled to a
home lot.Neither is he entitled to construct a house of his own or to continue maintaining the
same within the very small landholding of petitioner. To rule otherwise is to make a mockery of
the purpose of the tenancy relations between a bona-fide tenant and the landholder as
envisioned by the very law, i.e., Rep. Act No. 1199, as amended, upon which private respondent
relies, to wit:

Sec. 2. Purpose. It is the purpose of this Act to establish agricultural

tenancy relations between landholders and tenants upon the principle of
social justice; to afford adequate protection to the rights of both
tenants and landholders; to insure the equitable division of the
produce and income derived from the land; to provide tenant-farmers
with incentives to greater and more efficient agricultural production; to
 bolster their economic position and to encourage their participation in the
development of peaceful, vigorous and democratic rural communities.

ANICETO M. QUIO vs. COURT OF APPEALS et al.

G.R. No. 118599, 26 June 1998, First Division (Bellosillo, J.)

Bernarda and Rosario Galan sold their agricultural land with an area of 2.3926 hectares
situated in Basak, Compostela, Cebu, to spouses Antonio Leonardo Sr. and Josefa Galan
forP2,000.00. More than a decade later, petitioner Aniceto Quio filed a complaint for redemption
of the property against the vendees claiming that he had been instituted as tenant thereon by
the Galans since 1951; consequently, he had the right to be notified in writing of the owners'
intention to sell the property to enable him to exercise his right of preemption under Sec. 11 of
RA No. 3844 but that notwithstanding the Galans had not informed him of the sale. He claimed
that he learned of the transaction only he found out that the Leonardos were already the
new owners. He therefore prayed that he be allowed to redeem the property and consigned the
purchase price with the trial court on the same day he filed his complaint.

Meanwhile, the Leonardos sold the property to private respondent Jose Bitoon
for P30,000.00. Petitioner filed another complaint against the same spouses for injunction with a
prayer for a restraining order to enjoin his ejectment from the property. During the pendency of
the case, Antonio Leonardo Sr. died. His children, were substituted in his stead as co-
defendants. Petitioner consigned the amount of P2000.00 paid by the Leonardos to the
Galans. However, when he amended his complaint by impleading respondent Bitoon, he did not
increase the amount consigned as would have made it equivalent to P30,000.00, representing
payment by the second vendee. In this regard, petitioner submits that he is not required to
consign the latter amount since that would put an additional burden on a tenant seeking
redemption. After all, he would be paying whatever amount would be finally determined by the
trial court as reasonable price and consideration.

ISSUE: Whether or not failure of petitioner to consign the entire redemption price constitutes to
an invalid exercise by him of his legal right to redeem.

HELD: Yes. In the event that the landholding is sold to a third person without the knowledge of
the agricultural lessee, the latter is granted by law the right to redeem it within one hundred
eighty (180) days from notice in writing and at a reasonable price and consideration. Petitioner
was not notified of the first and second instances of sale of the property apparently because all
the respondents disputed petitioner's assertion that he has been a tenant thereon since 1951.
These instances of sale without notification gave rise to his right to redeem the property as
lessee although no longer from the Leonardos but from its present owner, respondent Bitoon.

An offer to redeem to be properly effected can either be through a formal tender with
consignation or by filing a complaint in court coupled with consignation of the redemption price
within the prescribed period. It must be stressed however that in making a repurchase it is not
sufficient that a person offering to redeem merely manifests his desire to repurchase; this
statement of intention must be accompanied by an actual and simultaneous tender of payment
which constitutes the legal use or exercise of the right to repurchase. And the tender of payment
must be for the full amount of the repurchased price, otherwise the offer to redeem will be held
ineffectual. As to what constitutes reasonable price and consideration, the valuation placed by
the Leonardo spouses and respondent Bitoon themselves as price of the land must be taken to
be such reasonable price and consideration.

Consignation of the entire price would remove all controversies as to the redemptioner's
ability to pay at the proper time. Against such rationale, petitioner's submission is rendered
insignificant. The amount so consigned by him falls short of the requirement of the law and
leaves the Court with no choice but to rule against him.

CENTRAL MINDANAO UNIVERSITY REPRESENTED ITS PRESIDENT DR. LEONARDO A.

CHUA vs. THE DEPARTMENT OF AGRARIAN REFORM ADJUDICATION BOARD et al.
G.R. No. 100091, 22 October 1992, En Banc (Campos, Jr., J.)

The petitioner, the CMU, is an agricultural educational institution owned and run by the
state located in the town of Musuan, Bukidnon province.

In 1984, the CMU approved Resolution No. 160, adopting a livelihood program called
"Kilusang Sariling Sikap Program" under which the land resources of the University were leased
to its faculty and employees. This arrangement was covered by a written contract. Under this
program the faculty and staff combine themselves to groups of five members each, and the
CMU provided technical know-how, practical training and all kinds of assistance, to enable each
group to cultivate 4 to 5 hectares of land for the lowland rice project. Each group pays the CMU
a service fee and also a land use participant's fee. The contract prohibits participants and their
hired workers to establish houses or live in the project area and to use the cultivated land as a
collateral for any kind of loan. It was expressly stipulated that no landlord-tenant relationship
existed between the CMU and the faculty and/or employees.

Among the participants in this program were Alvin Obrique, Felix Guinanao, Joven
Caballero, Nestor Pulao, Danilo Vasquez, Aronio Pelayo and other complainants. Obrique was a
Physics Instructor at the CMU while the others were employees in the lowland rice project. The
other complainants who were not members of the faculty or non-academic staff CMU, were
hired workers or laborers of the participants in this program.

When petitioner Dr. Leonardo Chua became President of the CMU in July 1986, he
discontinued the agri-business project for the production of rice, corn and sugar cane known as
 Agri-Business Management and Training Project, due to losses incurred while carrying on the
said project. Some CMU personnel, among whom were the complainants, were laid-off when
this project was discontinued. As Assistant Director of this agri-business project, Obrique was
found guilty of mishandling the CMU funds and was separated from service by virtue of
Executive Order No. 17, the re-organization law of the CMU.

Sometime in 1986, under Dr. Chua as President, the CMU launched a self-help project
called CMU-Income Enhancement Program (CMU-IEP) to develop unutilized land resources,
mobilize and promote the spirit of self-reliance, provide socio-economic and technical training in
actual field project implementation and augment the income of the faculty and the staff.

The one-year contracts expired on June 30, 1988. Some contracts were renewed. Those
whose contracts were not renewed were served with notices to vacate.

The non-renewal of the contracts, the discontinuance of the rice, corn and sugar cane
project, the loss of jobs due to termination or separation from the service and the alleged
harassment by school authorities, all contributed to, and precipitated the filing of the complaint.

On the basis of the above facts, the DARAB found that the private respondents were not
tenants and cannot therefore be beneficiaries under the CARP. At the same time, the DARAB
ordered the segregation of 400 hectares of suitable, compact and contiguous portions of the
CMU land and their inclusion in the CARP for distribution to qualified beneficiaries.

ISSUES:

1.) Whether or not the DARAB has jurisdiction to hear and decide Case No. 005 for Declaration
of Status of Tenants and coverage of land under the CARP.

2.) Whether or not respondent Court of Appeals committed serious errors and grave abuse of
discretion amounting to lack of jurisdiction in dismissing the Petition for Review on Certiorari and
affirming the decision of DARAB.

HELD:

1.)No. Under Section 4 and Section 10 of R.A. 6657, it is crystal clear that the jurisdiction of the
DARAB is limited only to matters involving the implementation of the CARP. More specifically, it
is restricted to agrarian cases and controversies involving lands falling within the coverage of
the aforementioned program. It does not include those which are actually, directly and
exclusively used and found to be necessary for, among such purposes, school sites and
campuses for setting up experimental farm stations, research and pilot production centers, etc.

Consequently, the DARAB has no power to try, hear and adjudicate the case pending
before it involving a portion of the CMU's titled school site, as the portion of the CMU land
reservation ordered segregated is actually, directly and exclusively used and found by the
school to be necessary for its purposes.
2.) Yes. As to the determination of when and what lands are found to be necessary for use
by the CMU, the school is in the best position to resolve and answer the question and
pass upon the problem of its needs in relation to its avowed objectives for which the land
was given to it by the State. Neither the DARAB nor the Court of Appeals has the right to
substitute its judgment or discretion on this matter, unless the evidentiary facts are so
manifest as to show that the CMU has no real for the land.