March 26, 1999
DAR OPINION NO. 33-99
MEMORANDUM
TO : DIRECTOR EUGENIO B. BERNARDO
DAR-Region IV
Capitol Compound, Pasig City
SUBJECT : Regarding Query Whether A Vendee of Foreclosed Lands Pursuant to Section 6,
R.A. No. 7881 and DAR Memorandum Circular No. 5, Series of 1996 Be Entitled
to Retention Per DAR A.O. No. 11, Series of 1990
We believe that the vendee is not entitled to retention. DAR Opinion No. 120 dated 13 December 1996 had earlier ruled and settled this issue, quote:
"2. Section 6 of R.A. No. 7881 provides the following:
Section 6. There shall be incorporated after Section 73 of RA. No. 6657 a new Section to read as follows:
Section 73-A. Exception. — The provisions of Section 73, paragraph (e), to the contrary notwithstanding, the sale and/or transfer of agricultural land in cases where such sale, transfer or conveyance is made necessary as a result of a bank's foreclosure of the mortgaged land is hereby permitted."
xxx xxx xxx
As regards private banks, Section 71 of R.A. No. 6657 provides that said foreclosed assets are subject to existing laws on their compulsory transfer (that is under the General Banking Act) and acquisition under Section 16 of said Act. This means that private banks may sell to third parties their foreclosed assets but still subject to acquisition under Section 16 of R.A. No. 6657. In such a case, it is submitted that the DAR Certification/Clearance required under A.O. No. 1, Series of 1989, is no longer necessary as the buyer cannot legally exercise any retention right on the land purchased." (emphasis supplied)
Please find copy of DAR Opinion No. 120, Series of 1996 for reference.
For your information and guidance.
08 December 1998.
(SGD.) DANILO T. LARA
Undersecretary for Legal Affairs, and Policy and Planning
Copy furnished:
OSEC
Doc. No. 98110429
Severino T. Madronio
Assistant Secretary
This Department
Gloria J. Fabia
Director, BLAD
This Department