Bitanagan Farmers Agrarian Reform Beneficiaries Association v. Hacienda Bitanagan
REITERATIONFacts
1. The Antecedents: Hacienda Bitanagan initially sought deferment and later exclusion from the Comprehensive Agrarian Reform Program (CARP) for three parcels of land totaling 285.5785 hectares, alleging they were devoted to cattle raising. The dispute centers on whether these lands were actually, directly, and exclusively used for livestock, or if other agricultural activities, such as copra production, were also conducted, thereby potentially bringing them under CARP coverage. The core issue involves the interpretation of CARP's coverage and exemptions, particularly concerning lands used for livestock versus other agricultural purposes. 2. Procedural History: The application for exclusion was initially filed in 1996. After a vehicular accident caused the loss of the original application documents, Hacienda Bitanagan reconstituted and refiled its application. The DAR Regional Director approved the exclusion in 2010. However, the DAR Secretary reversed this decision in 2012, finding the Regional Director lacked jurisdiction and that the land was not exclusively used for cattle raising. This decision was affirmed by the Office of the President. The Court of Appeals partially granted Hacienda Bitanagan's petition for review, modifying the DAR Secretary's decision to exclude one parcel of land. Subsequently, an amended decision by the Court of Appeals excluded all three parcels. The Bitanagan Farmers Agrarian Reform Beneficiaries Association then filed a Petition for Review with the Supreme Court. 3. The Petition: The Bitanagan Farmers Agrarian Reform Beneficiaries Association, in its Petition for Review under Rule 45, argues that the DAR Regional Director lacked jurisdiction because Administrative Order No. 09-1993, under which the reconstituted application was processed, had been declared unconstitutional. The petitioner also contends that the landholdings were not exclusively used for cattle-raising, citing financial records showing income from copra sales. Furthermore, they argue that the DAR Secretary's decision became final and executory due to respondent's alleged failure to file a timely motion for reconsideration. The petitioner seeks to have the Court of Appeals' decision reversed and the DAR Secretary's order reinstated.
Issue(s)
Whether the Court of Appeals erred in extending the effects of DAR Administrative Order No. 09, Series of 1993 to Hacienda Bitanagan's reconstituted application even after the issuance had been declared unconstitutional, and whether the DAR Regional Director had jurisdiction over the application. Whether the Court of Appeals erred in ruling that the landholdings are exempted from the coverage of agrarian reform.
Ruling
The Petition is GRANTED. The December 15, 2017 Decision and October 25, 2018 Amended Decision of the Court of Appeals are REVERSED. The November 25, 2012 Order of the Secretary of the Department of Agrarian Reform is REINSTATED.
Ratio Decidendi
On the applicability of DAR Administrative Order No. 09, Series of 1993, the operative fact doctrine, and the jurisdiction of the DAR Regional Director: The Court held that the Court of Appeals erred in applying the principle of prospectivity of judicial decisions. The principle of prospectivity applies when there is a new case reversing an old doctrine, which was not the case here as Department of Agrarian Reform v. Sutton affirmed Luz Farms and declared DAR Administrative Order No. 9, Series of 1993 unconstitutional. The operative fact doctrine, which allows the effects of a law or administrative issuance prior to its declaration of nullity to be left undisturbed, was found not applicable. The Court found that Hacienda Bitanagan was at fault in the delay of the resolution of its application due to its withdrawal of reconstructed documents for safekeeping, which was deemed a strategic maneuver to avoid the effects of Administrative Order No. 1, Series of 2004. Therefore, Hacienda Bitanagan was not in good faith, and applying the operative fact doctrine would give it an unwarranted advantage. The reconstituted application, filed in 2007, should be resolved under Administrative Order No. 1, Series of 2004. Under Administrative Order No. 1, Series of 2004, applications for exclusion involving lands larger than five (5) hectares fall under the jurisdiction of the DAR Secretary, not the Regional Director. Since Hacienda Bitanagan's landholdings aggregated 285.5785 hectares, the Regional Director's approval of the exclusion was void for lack of jurisdiction. On the exemption from CARP coverage: The Court reiterated that for exclusion from CARP coverage, the landholding must be actually, directly, and exclusively used for cattle raising. The Articles of Incorporation of Hacienda Bitanagan showed it was engaged in various agricultural ventures, including copra production. Financial statements from 1988 to 1996 consistently showed income derived from both copra sales and cattle sales, indicating the land was not exclusively used for cattle raising. Affidavits from residents and laborers, as well as the CLUPPI investigation report, also confirmed agricultural activities like coconut farming and copra production. The presence of a copra dryer further evidenced agricultural activity. Therefore, Hacienda Bitanagan failed to prove the exclusivity of its cattle-raising activity, a requirement for exclusion under DAR Administrative Order No. 1, Series of 2004. The Court also noted the findings of no livestock or infrastructure in Lot No. 3-A-5 and Lot No. F-11-05-008043, further negating the claim of exclusive cattle raising.
Main Doctrine
The operative fact doctrine cannot be invoked to give unwarranted advantage to a landowner engaged in cattle farming who is not in good faith in applying for exclusion of a landholding from the coverage of agrarian reform. For exclusion, there must be a showing that the landholding is actually, directly, and exclusively used for livestock raising.