Natalia Realty, Inc. v. Department of Agrarian Reform
REITERATIONFacts
The Antecedents: Petitioner Natalia Realty, Inc. (NATALIA) owned three contiguous parcels of land in Antipolo, Rizal, totaling 125.0078 hectares. These properties were situated within the Lungsod Silangan Townsite Reservation, established by Presidential Proclamation No. 1637 in 1979 for housing the population overspill of Metro Manila. Petitioner Estate Developers and Investors Corporation (EDIC), as developer of NATALIA's properties, obtained preliminary approval and locational clearances from the Human Settlements Regulatory Commission (precursor to HLURB) for Phases I, II, and III of the Antipolo Hills Subdivision project between 1982 and 1986. These permits indicated compliance with Presidential Decree No. 957. On June 15, 1988, Republic Act No. 6657 (Comprehensive Agrarian Reform Law or CARL) took effect. Subsequently, on November 22, 1990, the Department of Agrarian Reform (DAR) issued a Notice of Coverage on the undeveloped portions of the Antipolo Hills Subdivision, approximately 90.3307 hectares. Procedural History: NATALIA objected to the Notice of Coverage. EDIC also protested to DAR Region IV Director Wilfredo Leano. Members of Samahan ng Magsasaka sa Bundok Antipolo, Inc. (SAMBA) filed a complaint against NATALIA and EDIC to restrain development of areas under cultivation by SAMBA members, leading to a temporary restraining order and a writ of preliminary injunction issued by the DAR Regional Adjudicator. NATALIA and EDIC elevated the matter to the DAR Adjudication Board (DARAB), which remanded the case to the Regional Adjudicator for further proceedings. NATALIA also wrote the Secretary of Agrarian Reform reiterating its request to set aside the Notice of Coverage. With no action taken on their protests for over a year, NATALIA and EDIC filed the instant petition for certiorari, imputing grave abuse of discretion to the DAR for including undeveloped portions of the subdivision within CARL coverage. The Petition: Petitioners NATALIA and EDIC assailed the Notice of Coverage issued by the DAR, arguing that their properties ceased to be agricultural lands upon their inclusion in the townsite reservation and subsequent approval of subdivision development permits prior to the effectivity of R.A. 6657. They contended that the DAR gravely abused its discretion in including these lands under CARL.
Issue(s)
Whether lands already classified for residential, commercial, or industrial use, as approved by the Housing and Land Use Regulatory Board and its precursor agencies prior to June 15, 1988, are covered by R.A. 6657 (Comprehensive Agrarian Reform Law of 1988). Whether the DAR committed grave abuse of discretion in issuing a Notice of Coverage over the undeveloped portions of the Antipolo Hills Subdivision. Whether the petition was prematurely filed due to the pendency of a case before the DAR Regional Adjudicator.
Ruling
The petition is impressed with merit. The Supreme Court GRANTED the petition for Certiorari and SET ASIDE the Notice of Coverage dated November 22, 1990, by virtue of which undeveloped portions of the Antipolo Hills Subdivision were placed under CARL coverage. The Court ruled that public respondents gravely abused their discretion in issuing the assailed Notice of Coverage over lands on which they no longer have jurisdiction.
Ratio Decidendi
On the coverage of R.A. 6657 for lands classified for non-agricultural use prior to its effectivity: The Court held that lands devoted to agricultural activity are covered by R.A. 6657, but this definition explicitly excludes lands classified as mineral, forest, residential, commercial, or industrial. The deliberations of the Constitutional Commission confirmed that "agricultural lands" do not include commercial, industrial, and residential lands. In this case, the NATALIA properties were intended for residential use and ceased to be agricultural lands upon their approval for inclusion in the Lungsod Silangan Reservation. Even though development was delayed, the lands remained residential and outside the ambit of CARL. The DAR's own Revised Rules and Regulations Governing Conversion of Private Agricultural Lands to Non-Agricultural Uses defined "agricultural land" as not classified in town plans and zoning ordinances as approved by the HLURB and its preceding competent authorities prior to June 15, 1988, for residential, commercial, or industrial use. Since the NATALIA lands were converted prior to this date, the DAR was bound by such conversion and erred in including them under CARL coverage. Furthermore, Presidential Proclamation No. 1637, which created the townsite reservation, is a special law, and in statutory construction, a special law prevails over a general law. The permits granted to petitioners indicated compliance with P.D. 957, and the predecessor agency of HLURB noted compliance with all prescribed requirements. On the alleged grave abuse of discretion by the DAR: The Court found that the DAR committed grave abuse of discretion in issuing the Notice of Coverage because the lands in question had already been converted for residential use prior to the effectivity of CARL and were thus outside the DAR's jurisdiction. The inclusion of these lands under CARL coverage was an act done without or in excess of jurisdiction. The Court noted that the Solicitor General did not contest the conversion of portions of the subdivision that had already been developed, which was inconsistent with their position on the undeveloped portions, as the applications for both were similarly situated and did not require prior DAR approval. On the issue of failure to exhaust administrative remedies: The Court clarified that the issues raised in the case filed by SAMBA members (involving possession) differed from those of petitioners (involving the propriety of including lands already converted for residential use prior to CARL's effectivity). Moreover, petitioners were not obligated to wait indefinitely for the DAR's action on their protest-letters, especially after a year of official indifference. The Court stated that given the official indifference, which could have continued indefinitely, petitioners had to act to assert and protect their interests, thus justifying their resort to judicial action.
Main Doctrine
Lands classified for residential, commercial, or industrial use, as approved by the Housing and Land Use Regulatory Board and its precursor agencies prior to June 15, 1988, are not covered by Republic Act No. 6657, otherwise known as the Comprehensive Agrarian Reform Law of 1988.