Alsl - Digests 2019.docx

Luz Farms v. Secretary of DAR G.R. No. 86889 December 4, 1990

the constitutionally mandated agrarian reform program of the government.

Facts:

Further, Commissioner Tadeo pointed out that the reason why they used the term “farmworkers” rather than “agricultural workers” in the said law is because “agricultural workers” includes the livestock and poultry industry, hence, since they do not intend to include the latter, they used “farmworkers” to have distinction.

On 10 June 1988, RA 6657 was approved by the President of the Philippines, which includes, among others, the raising of livestock, poultry and swine in its coverage. Petitioner Luz Farms, a corporation engaged in the livestock and poultry business, avers that it would be adversely affected by the enforcement of sections 3(b), 11, 13, 16 (d), 17 and 32 of the said law. Hence, it prayed that the said law be declared unconstitutional. The mentioned sections of the law provides, among others, the productsharing plan, including those engaged in livestock and poultry business.

Hence, there is merit on the petitioner’s argument that the productsharing plan applied to “corporate farms” in the contested provisions is unreasonable for being consficatory and violative of the due process of law.

Luz Farms further argued that livestock or poultry raising is not similar with crop or tree farming. That the land is not the primary resource in this undertaking and represents no more than 5% of the total investments of commercial livestock and poultry raisers. That the land is incidental but not the principal factor or consideration in their industry. Hence, it argued that it should not be included in the coverage of RA 6657 which covers “agricultural lands”.

Facts: On 16 January 1958, President Carlos Garcia issued Proclamation No. 467 reserving for the Mindanao Agricultural College, now the CMU, a piece of land to be used as its future campus.

Issue: Whether or not certain provisions of RA 6657 is unconstitutional for including in its definition of “Agriculture” the livestock and poultry industry? Ruling: The Court held YES. Looking into the transcript of the Constitutional Commission on the meaning of the word “agriculture”, it showed that the framers never intended to include livestock and poultry industry in the coverage of

------------------------------------------------------------------Central Mindanao University vs. Department of Agrarian Reform

In 1984, CMU embarked on a project titled "Kilusang Sariling Sikap" wherein parcels of land were leased to its faculty members and employees. Under the terms of the program, CMU will assist faculty members and employee groups through the extension of technical know-how, training and other kinds of assistance. In turn, they paid the CMU a service fee for use of the land. The agreement explicitly provided that there will be no tenancy relationship between the lessees and the CMU. When the program was terminated, a case was filed by the participants of the "Kilusang Sariling Sikap" for declaration of status as tenants under the CARP. In its resolution, DARAB, ordered, among others, the segregation of 400 hectares of the land for distribution

under CARP. The land was subjected to coverage on the basis of DAR's determination that the lands do not meet the condition for exemption, that is, it is not "actually, directly, and exclusively used" for educational purposes. Issue: Is the CMU land covered by CARP? Who determines whether lands reserved for public use by presidential proclamation is no longer actually, directly and exclusively used and necessary for the purpose for which they are reserved? Held: The land is exempted from CARP. CMU is in the best position to resolve and answer the question of when and what lands are found necessary for its use. The Court also chided the DARAB for resolving this issue of exemption on the basis of "CMU's present needs." The Court stated that the DARAB decision stating that for the land to be exempt it must be "presently, actively exploited and utilized by the university in carrying out its present educational program with its present student population and academic faculty" overlooked the very significant factor of growth of the university in the years to come. -----------------------------------------------------------------------------------------Natalia Realty, Inc. vs. Department of Agrarian Reform 225 SCRA 278 (1993) Facts: Petitioner Natalia Realty, Inc. is the owner of a 125.0078-ha land set aside by Presidential Proclamation No. 1637 (1979) as townsite area for the Lungsod Silangan Reservation. Estate Developers and Investors Corporation (EDIC), the developer of the area, was granted preliminary approval and locational clearances by the then Human Settlements Regulatory Commission (HSRC) for the establishment of

the Antipolo Hills Subdivision therein. In November 1990, a Notice of Coverage was issued by DAR on the undeveloped portion of the landholding. The developer filed its objections and filed this case imputing grave abuse of discretion to respondent DAR for including the undeveloped portions of its landholding within the coverage of CARP. Issue: Are lands already classified for residential, commercial or industrial use, and approved by HLURB and its precursor agencies prior to 15 June 1988, covered by RA 6657? Held: Sec. 4 of RA 6657 states that the CARL covers "regardless of tenurial arrangement and commodity produced, all public and private and agricultural lands" and as per the transcripts of the Constitutional Commission, "agricultural lands" covered by agrarian reform refers only to those which are "arable and suitable lands" and "do not include commercial, industrial and residential lands." The land subject of the controversy has been set aside for the Lungsod Silangan Reservation by Proclamation No. 1637 prior to the effectivity of RA 6657 and in effect converted these lands into residential use. Since the Natalia lands were converted prior to 15 June 1988, DAR is bound by such conversion, and thus it was an error to include these within the coverage of CARL. -----------------------------------------------------------------------------------------DAR vs Sutton Facts: Respondent inherited a land in Aroroy, Masbate devoted exclusively to cow and calf breeding. On October 26, 1987, pursuant to the existing agrarian reform program of the government, respondent

made a voluntary offer to sell (VOS) their landholdings to petitioner DAR to avail incentives under the law. On June 10, 1988, a new agrarian law, RA 6657 known as Comprehensive Agrarian Reform Law (CARL) of 1988 took effect. It included in its coverage farms used for raising livestock, poultry and swine.

counter to the Luz Farm case as the A.O provided the guidelines to determine whether a certain parcel of land is being used for cattleraising. Issue: Whether DAR A.O No.9 is unconstitutional? Held:

An en banc decision in the case of Luz Farms vs. Secretary of DAR, ruled that land devoted to livestock and poultry-raising are not included in the definition of agricultural land. In view of the Luz Farm ruling, respondent filed with petitioner DAR a formal request to withdraw their VOS as their landholding was exclusively to cattle-raising and thus exempted from the coverage of the CARL. Petitioner ignored their request. DAR issue A.O No. 9, series of 1993, which provided that only portion 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 the ration of 1.7815 hectares for livestock infrastructure for every 21 heads of cattle shall likewise be excluded from the operation of the CARL.

Administrative agencies are endowed with powers legislative in nature. They have been granted by Congress with the authority to issue rules to regulate the implementation of a law entrusted to them. Delegated rule-making has become a practical necessity in modern governance due to the increasing complexity and variety of public functions. However, while administrative rules and regulations have the force and effect of law, they are not immune from judicial review. They may be properly challenged before the courts to ensure that they do not violate the Constitution and no grave abuse of administrative discretion is committed by the administrative body concerned.

DAR Secretary Garilao issue an Order partially granting the application of respondents for exemption from the coverage of CARL applying the retention limit outlined in the DAR A.O No. 9. Petitioner ordered the rest of respondents’ landholding to be segregated and placed under Compulsory Acquisition.

The fundamental rule in administrative law is that, to be valid, administrative rules and regulations must be issued by authority of a law and must not contravene the provisions of the Constitution. The rule-making power of an administrative agency may not be used to abridge the authority given to it by Congress or by the Constitution. Nor can it be used to enlarge the power of the administrative agency beyond the scope intended. Constitutional and statutory provisions control with respect to what rules and regulations may be promulgated by administrative agencies and the scope of their regulations.

On October 2001, the Office of the President affirmed the impugned Order of petitioner DAR. It ruled that DAR A.O. no. 9 does not run

In the case at bar, SC find that 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. 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. Respondents’ family acquired their landholdings as early as 1948. They have long been in the business of breeding cattle in Masbate which is popularly known as the cattle-breeding capital of the Philippines. Petitioner DAR does not dispute this fact. Indeed, there is no evidence on record that respondents have just recently engaged in or converted to the business of breeding cattle after the enactment of the CARL that may lead one to suspect that respondents intended to evade its coverage. It must be stressed that what the CARL prohibits is the conversion of agricultural lands for non-agricultural purposes after the effectivity of the CARL. There has been no change of business interest in the case of respondents. 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 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.