July 30, 1997

DAR OPINION NO. 82-97

Victor Gerardo J. Bulatao

Undersecretary for FOG/SSO

Department of Agrarian Reform

Diliman, Quezon City

Dear USEC Bulatao:

This has reference to the Memorandum of former Undersecretary for FOG/SSO, Hector D. Soliman dated 19 May 1997 addressed to the undersigned seeking opinions on the queries posed therein, to wit:

1)        Whether to adopt the decision of the Office of the President dated 21 February 1995, which was affirmed with finality on 20 December 1995, or to adopt the DARAB Resolution promulgated on 20 March 1997 on the coverage of the mango orchard; and

2)        Whether the Asset Privatization Trust (APT) can execute a Deed of Transfer (DOT) with DAR pursuant to E.O. No. 407 considering that ownership of the property has not been transferred to the national government or to the APT?

As gleaned from his Memorandum together with the enclosures therein attached, the subject properties have an aggregate area of 816.2916 hectares, more or less, situated at Barangays Tayamaan, Balansay and Payampon, Mamburao, Occidental Mindoro; that said properties are registered in the name of Golden Country Farms, Inc. (GCFI) which is engaged primarily in buying, selling, importing, exporting, improving, preparing, processing, producing, dealing and trading in cattle, swine, poultry, live and dead stock of every kind and description; that Golden Country Farms, Inc. filed a Petition for Exemption from CARP coverage invoking the ruling of the Supreme Court in Luz Farms vs. The Honorable Secretary of the Department of Agrarian Reform (G.R. No. 86889, December 4, 1990, 192 SCRA 51) declaring as unconstitutional the inclusion of lands devoted to commercial raising of livestock, poultry and swine in the coverage of Republic Act No. 6657, otherwise known as the Comprehensive Agrarian Reform Law (CARL); that the DAR through its Order dated 5 October 1993 denied the Petition for Exemption filed by Golden Country Farms, Inc., through its President Ricardo V. Quintos; that as a result of such decision Golden Country Farms, Inc. appealed to the Office of the President for proper review; that the Office of the President in a decision dated 21 February 1995 in O.P. Case No. 5454 set aside the Order of the DAR except those portions where mango orchards are located, the coverage and compulsory acquisition of which shall be deferred pursuant to Section 11 of R.A. No. 6657; that said decision was likewise confirmed in toto in a Resolution dated 20 December 1995 denying the motion for reconsideration filed by the DAR; and that surprisingly, the DARAB took an inconsistent position when it ruled in its March 20, 1997 decision that the farmers may qualify as farmer-beneficiaries as determined by the Municipal Agrarian Reform Officer (MARO) in. the mango orchard involving two hundred forty nine (249) hectares which is covered under the Comprehensive Agrarian Reform Program (CARP), hence, Certificates of Land Ownership Award (CLOAs) should be generated immediately and distributed to qualified farmer-beneficiaries. Thus, inconsistency arises because while the Office of the President ordered for the deferment of coverage of the mango orchard until June 15, 1998 pursuant to Section 11 of R. A. No. 6657, the DARAB on the other hand ordered for its immediate coverage.

Anent your first query, it is a well-entrenched principle in law that the allocation of jurisdiction to various government agencies is designed to prevent encroachment of one by the other and through this proscription stability will thus be attained. Corollarily, by express provision of the New Rules of Procedure of the Department of Agrarian Reform Adjudication Board (DARAB), matters involving strictly the administrative implementation of R. A. No. 6657 and other agrarian laws as enunciated by pertinent rules shall be the exclusive prerogative of and cognizable by the Secretary of Agrarian Reform. The decision of the Secretary of Agrarian Reform on the matter is appealable to the Office of the President for proper review and in compliance with the doctrine of exhaustion of administrative remedies. On the other hand, the jurisdiction of the DARAB is limited to quasi-judicial functions enumerated under the New Rules of Procedure of the DARAB.

Undeniably, the issue of coverage or exemption under R. A. No. 6657 and other agrarian laws is an administrative matter which only the Office of the President can validly pass upon with finality. Strictly speaking, the DARAB is bereft of authority to assume jurisdiction over administrative matters since it does not legally possess such power. In sum, the authority to decide administrative matters is lodged exclusively with the Office of the President to the exclusion of others, thus, the decision of the DARAB on the issue of coverage shall be considered a patent nullity.

Anent your second query, the answer is in the negative. A case in point are the properties of Golden Country Farms, Inc. (GCFI) sequestered by the PCGG wherein the management and operation thereof were transferred to APT. A civil case was filed by GCFI before the court to settle the issue of ownership. Later, a Memorandum of Agreement (MOA) between GCFI through its President, Mr. Rolando V. Quintos, and the APT was executed transferring possession and management of the GCFI properties to the former on 26 February 1992 and subsequently approved by the court on 28 May 1992. Here, there is a clear indication that the subject properties still belong to GCFI in ownership. Such being the case, the AFT cannot enter into any conveyance contract or any disposition involving said properties for they have not actually acquired any interest or vested right whatsoever over the same.

We hope to have clarified the matters with you.

Very truly yours,

(SGD.) ARTEMIO A. ADASA, JR.

Undersecretary for Legal Affairs, and Policy and Planning

Copy furnished:

Mr. Rolando V. Quintos

2202 F. Zobel St.

San Miguel Village

Makati City

Dir. Eugenio B. Bernardo

DAR Region IV

Capitol Compound, Pasig City

OIC-PARO Ben B. Estrada

DAR Provincial Office

San Jose, Occidental Mindoro

Rep. Jose Tapalos-Villarosa

Batasang Pambansa Bldg.

Quezon City

Governor Josephine T. Ramirez-Sato

Mamburao, Occidental Mindoro

Kanlurang Mindoro Farmer Coop. Inc.

Mamburao, Occidental Mindoro

Asset Privatization Trust

North Davao Mining Corp. Bldg.

104 Gamboa St., Legaspi Village

Makati City