Department of Agrarian Reform v. Franco
REITERATIONFacts
The Antecedents: In January 1994, the Department of Agrarian Reform (DAR), through Municipal Agrarian Reform Officer (MARO) Patrocinia G. Mercado, initiated proceedings to bring Paulino Franco's land in Babag, Cebu City under the agricultural leasehold system. Franco objected, asserting the land was classified as non-agricultural by Proclamation No. 2052 and Letter of Instruction No. 1256, and that it was not tenanted. Despite his objections, MARO Mercado prepared documentation folders for Provisional Lease Rentals in favor of several individuals identified as bona fide tenants, which were approved by Acting Provincial Agrarian Reform Officer (PARO) Buenaventura Pomida. Procedural History: Franco filed a petition with the DARAB, Region VII, Cebu City, seeking to nullify the orders of MARO Mercado and PARO Pomida. The Agrarian Reform Adjudicator ruled in favor of Franco, declaring the assailed orders void, citing Proclamation No. 2052, LOI No. 1256, and a previous DAR Secretary's order, and excluding the land from Operation Land Transfer and CARP coverage. On appeal, the DARAB affirmed the Adjudicator's decision. However, a DARAB member, Lorenzo R. Reyes, made a handwritten note stating Franco would still have to apply for conversion and that the appellants would be entitled to disturbance compensation if granted. DARAB Secretary Ernesto Garilao, as Chairperson, issued a separate opinion clarifying that the decision did not grant exemption and Franco must still comply with administrative requirements for exemption or conversion. Franco's motion for reconsideration of this note was denied. Franco appealed to the Court of Appeals, which affirmed the DARAB decision but modified it by deleting the disturbance compensation, finding no proof of tenancy. The DARAB itself had found no tenancy relationship. The Petition: The Department of Agrarian Reform, represented by officials, and the private petitioners (alleged tenants) filed a petition for review of the Court of Appeals' decision.
Issue(s)
Whether Presidential Proclamation No. 2052 has taken all agricultural lands within its coverage out of agrarian reform or only those acquired and developed by the PTA for tourism purposes. Whether Barangay Babag, where the land is located, is no longer coverable under the Comprehensive Agrarian Reform Program (CARP). Whether the Court of Appeals' finding of non-tenancy was proper despite not being factually determined in the lower court, and relatedly, the nature of the DARAB member's note and its appealability. Whether the Court of Appeals' ruling on the non-payment of disturbance compensation to private petitioners-farmers is valid and proper.
Ruling
The Supreme Court set aside the Court of Appeals' decision and reinstated the DARAB decision, affirming the nullity of the Provisional Leasehold Rental Orders. The Court held that the handwritten note by DARAB member Reyes was not part of the decision and could not be subject to a motion for reconsideration or appeal. The Court also noted that the Court of Appeals' ruling on disturbance compensation was premature and that the DAR is the proper body to determine entitlement to such compensation.
Ratio Decidendi
On the issues of Proclamation No. 2052 and CARP coverage: The Court reinstated the DARAB decision, which affirmed the Adjudicator's decision nullifying the Provisional Leasehold Rental Orders. This implies that the DARAB's finding that Franco's land was not agricultural land at the time the questioned orders were issued, due to its inclusion within a tourism zone under Proclamation No. 2052 and LOI No. 1256, was upheld. The Court also noted that lands already classified as non-agricultural before the enactment of RA 6657 do not need conversion clearance. The Court's decision to reinstate the DARAB decision effectively means that the issues regarding the extent of Proclamation No. 2052's coverage and whether Barangay Babag is still coverable under CARP were resolved in favor of Franco's land being excluded from CARP coverage, as per the DARAB's affirmation of the Adjudicator's ruling. On the issues of Proclamation No. 2052 and CARP coverage (continued): The Court reinstated the DARAB decision, which affirmed the Adjudicator's decision nullifying the Provisional Leasehold Rental Orders. This implies that the DARAB's finding that Franco's land was not agricultural land at the time the questioned orders were issued, due to its inclusion within a tourism zone under Proclamation No. 2052 and LOI No. 1256, was upheld. The Court also noted that lands already classified as non-agricultural before the enactment of RA 6657 do not need conversion clearance. The Court's decision to reinstate the DARAB decision effectively means that the issues regarding the extent of Proclamation No. 2052's coverage and whether Barangay Babag is still coverable under CARP were resolved in favor of Franco's land being excluded from CARP coverage, as per the DARAB's affirmation of the Adjudicator's ruling. On the nature of the DARAB member's note and its appealability: The Court held that the handwritten note by DARAB member Reyes, stating that Franco would still have to apply for conversion and that appellants would be entitled to disturbance compensation, was not part of the official DARAB decision. As such, it could not be the subject of a motion for reconsideration filed by Franco, nor could it be the basis for an appeal to the Court of Appeals. The Court emphasized the distinction between a judgment and an opinion, stating that an opinion, especially a personal view of a lone member, does not form part of the judgment and cannot prevail against the final order or decision. The DARAB's denial of the motion for reconsideration was proper, even if the resolution did not explicitly state the impropriety of the issue raised. The Court reiterated that matters, theories, or arguments not brought out in the proceedings below will ordinarily not be considered by a reviewing court, as they cannot be raised for the first time on appeal. This principle was applied to the private petitioners' new issues raised for the first time on appeal. On the Court of Appeals' ruling on disturbance compensation: The Court found that the Court of Appeals' ruling on the non-entitlement of private petitioners to disturbance compensation went beyond the DARAB decision being appealed. The determination of entitlement to disturbance compensation was deemed premature at that stage, as the original case only involved the issue of the nullity of the Provisional Leasehold Rental Orders. Furthermore, the Court stated that the Department of Agrarian Reform (DAR) is the agency best equipped to determine and identify legitimate tenants who may be entitled to disturbance compensation. The Court also referenced a significant DAR Order dated August 30, 1994, issued by then DAR Secretary Garilao, which set aside a previous order and delineated specific areas for tourism development and CARP coverage, with provisions for disturbance compensation for legitimate farmer-beneficiaries within the tourism zone, subject to further determination by the DAR Regional Office.
Main Doctrine
A handwritten note by a member of the Department of Agrarian Reform Adjudication Board (DARAB), which is not part of the dispositive portion of the decision, cannot be the subject of a motion for reconsideration or an appeal. Matters, theories, or arguments not raised before the DARAB cannot be raised for the first time on appeal.