Department of Agrarian Reform v. Apex Investment and Financing Corporation
REITERATIONFacts
The Antecedents: Respondent Apex Investment and Financing Corporation (now SM Investments Corporation) owns several lots in Dasmariñas, Cavite. On August 24, 1994, the Municipal Agrarian Reform Office (MARO) initiated compulsory acquisition proceedings over these lots under Republic Act No. 6657. The MARO issued notices of coverage and acquisition, which respondent claims it never received as it had moved from the address to which they were sent. Respondent only became aware of the acquisition when it saw a notice in a newspaper on December 11, 1997, regarding one of its lots being placed under the compulsory acquisition program. The Department of Agrarian Reform (DAR) subsequently sent a notice of land valuation and acquisition offering compensation for one lot. Procedural History: Respondent filed a protest with the PARO on January 12, 1998, rejecting the compensation offer and asserting that its lands were classified as residential prior to the effectivity of R.A. No. 6657, submitting supporting documents. A supplemental protest with certifications from the National Irrigation Administration and the Municipal Engineer of Dasmariñas, Cavite, further supported the residential classification. The PARO forwarded the protest to the DAR over a year later, on February 15, 1999. Meanwhile, respondent learned that its title to one lot was cancelled and a new title was issued to an alleged farmer-beneficiary. This prompted respondent to file a petition for certiorari and prohibition with the Court of Appeals, seeking to nullify the compulsory acquisition proceedings and the title issued to the farmer-beneficiary. The Court of Appeals granted the petition, declaring the compulsory acquisition null and void and prohibiting further proceedings and cancellation of titles, and ordering the restoration of the cancelled title to respondent. The DAR's motion for reconsideration was denied. The Petition: Petitioner, the Department of Agrarian Reform (DAR), filed this petition for review on certiorari under Rule 45 of the Rules of Civil Procedure, assailing the Court of Appeals' decision and resolution. Petitioner argues that the Court of Appeals erred in ruling that respondent did not violate the principle of exhaustion of administrative remedies, in holding that respondent was deprived of due process, and in concluding that the subject parcels of land are residential and thus not covered by R.A. No. 6657. Petitioner contends that respondent failed to exhaust all administrative remedies before filing its petition and that it was not deprived of due process, as notices were allegedly sent. The DAR also disputes the classification of the lands as residential.
Issue(s)
Whether the respondent violated the principle of exhaustion of administrative remedies. Whether the respondent was deprived of its constitutional right to due process. Whether the subject parcels of land are residential and thus not covered by R.A. No. 6657.
Ruling
The Supreme Court affirmed the Court of Appeals' Decision with modification, allowing the DAR to conduct appropriate proceedings to determine if the subject parcels of land are indeed residential and outside the coverage of R.A. No. 6657.
Ratio Decidendi
On the issue of exhaustion of administrative remedies: The Court held that the doctrine of exhaustion of administrative remedies is relative and flexible. It is disregarded when there are circumstances indicating the urgency of judicial intervention or when the administrative action is patently illegal and amounts to lack or excess of jurisdiction. In this case, the PARO's inaction for over a year on respondent's protest, coupled with DAR's repeated requests for documents already submitted, and the subsequent cancellation of titles and issuance of a CLOA to a farmer-beneficiary, demonstrated official indifference and urgency for judicial intervention. The Court cited Natalia Realty vs. Department of Agrarian Reform to support the view that aggrieved landowners should not wait indefinitely for administrative action, especially when their property rights are at stake. Therefore, the CA did not err in allowing the petition for certiorari and prohibition despite the pending protest. On the issue of deprivation of due process: The Court found that the respondent was deprived of its constitutional right to due process. Section 16(a) of R.A. No. 6657 requires that the DAR send a notice to acquire the land to the owner by personal delivery or registered mail. The DAR admitted that personal service could not be effected due to the change in respondent's corporate name. However, there was no showing that the notices were sent via registered mail as required. The DAR's claim of actual receipt based on an illegible signature was insufficient to prove proper notification. The Court reiterated the importance of notice and hearing in the exercise of eminent domain, as mandated by the Bill of Rights. Without proper notice, the compulsory acquisition proceedings were flawed, and the respondent was denied its right to be informed and to be heard before being deprived of its property. On the issue of land classification: The Court noted that Section 4 of R.A. No. 6657 covers all public and private agricultural lands, and Section 3(c) defines agricultural land as land devoted to agricultural activity and not classified as mineral, forest, residential, commercial, or industrial land. Respondent claimed its lots were classified as residential prior to R.A. No. 6657's effectivity, supported by a certification from the Municipal Engineer based on an HLURB-approved Land Use Plan. However, the Court observed that this factual issue was never determined by the lower courts. Therefore, the Supreme Court could not definitively conclude that the parcels were residential. Consequently, the case was remanded to allow the DAR to conduct appropriate proceedings to determine the land classification.
Main Doctrine
The doctrine of exhaustion of administrative remedies is a relative one and is flexible depending on the peculiarity and uniqueness of the factual and circumstantial settings of a case, and may be disregarded where there are circumstances indicating the urgency of judicial intervention or where the administrative action is patently illegal and amounts to lack or excess of jurisdiction. A landowner is deprived of procedural due process when not properly notified of compulsory acquisition proceedings, especially when the administrative agency fails to act on protests and proceeds to cancel titles and issue new ones to beneficiaries.