September 3, 1997
DAR OPINION NO. 102-97
PARO Alexis M. Arsenal
Provincial Agrarian Reform Office
Iloilo Province
Luna St., La Paz, Iloilo City
Dear PARO Arsenal:
This has reference to your letter requesting for legal opinion on the queries posed therein, to wit:
a. Whether or not deposits made by the beneficiaries to the LBP shall already constitute as amortization of the land pending final determination as to its valuation; and
b Whether or not landowners can still demand payment of rentals from the farmer-beneficiaries who are CLOA holders.
You state that the property (Malaga Estate) owned by Benigno Malaga, comprising of 107.044 hectares, more or less, was subjected to the coverage of Agrarian Reform Program under the Voluntary Offer to Sell (VOS); that the property was tenanted and seventy six (76) tenant-farmers were identified as beneficiaries; that identification was made by the DAR as to qualification and status of the beneficiaries prior to appropriation and assignment of the area corresponding to that actually tilled by them; that Certificates of Land Ownership Award (CLOAs) were generated in favor of the named beneficiaries; that the valuation of land as to the compensation payable to the landowner is still pending before the DARAB; and that the farmer-beneficiaries of the above-mentioned estate were paying rentals to the landowner despite the fact that CLOAs were issued to them.
Section 18 of R.A. No. 6657 provides, quote: "Valuation and Mode Compensation. — the LBP shall compensate the landowner in such amount as may be agreed upon by the landowner and the DAR and the LBP in accordance with the criteria provided for in Sections 16 and 17 and other pertinent provisions hereof, or as may be finally determined by the court as the just compensation for the land". On the other hand, Section 26 of the same law provides: "Lands awarded pursuant to this Act shall be paid for by the beneficiaries to the LBP in thirty (30) annual amortizations at six percent (6%) interest per annum".
From the aforequoted provisions of law and learning from the lessons in the previous agrarian reform programs, the CARP now separates the process of acquisition from distribution. These are now two separate transactions. The former is a transaction between the government and the landowner, while the latter is a transaction between the government and the agrarian reform beneficiaries. The landowner may still be contesting the land valuation but title to the land may already be transferred first to the Republic of the Philippines then to the beneficiaries.
Accordingly, anent your first query, when CLOAs were issued to farmer-beneficiaries and the same are already registered, the only obligation of said farmer-beneficiaries is to pay regularly and religiously the land amortization to the Land Bank of the Philippines. Thus, deposits made by the farmer-beneficiaries to the Land Bank pending final determination of land valuation shall already constitute as amortization of the land.
Corollarily, anent your second query, the landowner no longer has any legal right to demand payment for rentals from the farmer-beneficiaries who are already CLOA holders.
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