September 23, 2003
DAR OPINION NO. 19-03
MEMORANDUM
FOR : Alexis M. Arsenal
Regional Director
DAR Region VI
SUBJECT : Whether or Not Agricultural Landholdings Transferred On or After 15 June 1988 May be Offered and Subjected Under the Voluntary Offer to Sell (VOS) Scheme
This refers to the abovementioned issue you raised during the expanded MANCOM meeting held on 03 September 2003 at the OSEC Boardroom.
This problem occurred because of the perceived reluctance if not, alleged refusal of the Land Bank of the Philippines (LBP) to process the claim folder (CF) of the landholdings involved on the basis of the provision of Section 6 (paragraph 4) of R.A. No. 6657 (Comprehensive Agrarian Reform Law).
Pertinent to the issue are the following provisions of R.A. No. 6657 and related guidelines:
A. Paragraphs 1 and 4, Section 6, R.A. No. 6657
". . . . In no case shall retention by the landowner exceed five (5) hectares. . . . (emphasis supplied)
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Upon the effectivity of this Act, any sale, disposition, lease management contract or transfer of possession of private lands executed by the original landowner in violation of this Act shall be null and void; Provided, however, that those executed prior to this Act shall be valid only when registered with the Register of Deeds within a period of three (3) months after the effectivity of this Act. . . ." (emphasis supplied)
B. Section 70, R.A. No. 6657
"SECTION 70. Disposition of Private Agricultural lands. The sale or disposition of agricultural lands retained by a landowner as a consequence of Section 6 hereof shall be valid as long as the total landholdings that shall be owned by the transferee thereof in the case of the land to be acquired shall not exceed the landholding ceiling provided in this Act.
Any sale or disposition of agricultural lands after the effectivity of this Act found to be contrary to the provisions hereof shall be null and void." (emphasis supplied)
C. Section 73 (a), R.A. No. 6657
"SECTION 73. Prohibited Acts and Omissions. — The following are prohibited:
(a) The ownership or possession, for the purpose of circumventing the provisions of this Act, of agricultural lands in excess of the total retention limits or award ceilings by any person, natural or juridical, except those under collective ownership by farmer-beneficiaries." (emphasis supplied)
D. Item II.B.1 of DAR Administrative Order No. 1, series of 1989 (Rules and Procedures Governing Land Transactions)
"B. The following transactions are not valid:
1. Sale, disposition, lease, management contract or transfer of possession of private lands executed by the original landowner prior to June 15, 1988, which are not registered on or before September 13, 1988, or those executed after June 15, 1988, covering an area in excess of the five-hectare retention limit in violation of R.A. 6657." (emphasis supplied)
E. Item III.1.c and d of DAR Administrative Order No. 1, Series of 1989
"III. OPERATING PROCEDURES
In the issuance of clearance required under these rules, the following procedures shall be followed:
1. A written request shall be filed by the applicant with the Municipal Agrarian Reform Office (MARO) having territorial jurisdiction over the subject land, attaching thereon the following documents:
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c) Affidavit of transferee that he/she and spouse have a total landholding inclusive of the land to be acquired of not more than five (5) hectares if he/she is a non-beneficiary and three (3) hectares if beneficiary. Copy of the affidavit shall be furnished the BARC with proof of service indicated or attached to the copy for the Register of Deeds.
d) Affidavit of transferor stating that the land subject of deed is a retention or portion of the retention area." (emphasis supplied)
F. Section 2 of DAR Memorandum Circular No. 02, series 2001 (Guidelines on Annulment of Deeds of Conveyance of Lands Covered by the Comprehensive Agrarian Reform Program (CARP) Executed in Violation of Section 6, Paragraph 4 of Republic Act No. 6657) HEcID
"Section 2. Statement of Policy. — It is the policy of DAR to acquire and distribute all lands covered by R.A. No. 6657 including those subject of illegal transfers." (emphasis supplied)
At the outset, it bears stating/stressing the dispositive portion of DOJ Opinion No. 41, series of 1992 (copy herewith attached), to wit:
"Accordingly, it is believed that it is legally proper for that Department (i.e., DAR) to give clearance for the registration of titles of agricultural properties acquired prior to the effectivity of R.A. No. 6657, which were not registered within the 3-month period after such effectivity in cases where the said properties are voluntarily offered for sale to that Department for purposes of CARP coverage." (emphasis supplied)
On the basis of the aforequoted provisions of law, rules and regulations, we have to qualify, clarify and make distinctions with respect to agricultural landholdings subject of VOS acquired and/or transferred on or after 15 June 1988 effectivity of R.A. No. 6657):
1. If what is transferred/acquired is the retention area and the transferee will not own an aggregate of more than 5 hectares, and, where there is a DAR clearance issued pursuant to the provisions of DAR Administrative Order No. 1, series of 1989, the transfer is legal and proper. The 3-month grace period is immaterial/not applicable even if the execution and/or registration of the deed of transfer is within or after the 3-month period. The 3-month period mentioned under paragraph 4, Section 6 of R.A. No. 6657 contemplates only those transfers executed prior to 15 June 1988. Thus, subsequent VOS of said lands is legally allowed.
2. However, if what is transferred/acquired is more than the 5-hectare retention area and/or the transferee will own an aggregate of more than five (5) hectares, the transfer is null and void insofar as the excess of the 5-hectare retention limit or landowner ceiling is concerned (Section 6, 1st and 4th paragraphs, 70, 73(a) and DAR A.O. No. 1, series of 1989).
In the second instance above, the provisions of DOJ Opinion No. 41, series of 1992, although the issue therein is not squarely similar, may, however, find relative application, quote:
". . . . the spirit of, and the reason behind, the statutory provision is satisfied in the instance where the said landowner offers his property for CARP coverage. For, in such a situation, the mischief sought to be avoided by the legal provision in issue does not exist and therefore the legal requirement prescribed therein does not come into play.
Moreover, as the Land Registration Authority correctly argued in its opinion adverted to above:
"To hold otherwise will result in a complex situation where the initial sale or conveyance will have to be rescinded with both parties under the contract returning that which they received, the title to the property reverting back to the vendor who, in turn, will transfer the same to DAR. Since in the final analysis the property will end up in DAR's hands anyway, we believe that it was not the intention of the law to absolutely treat as null and void the sale or alienation of private agricultural lands executed prior to June 15, 1988 and registered beyond three months thereafter if the transferee under the sale is willing to place the land under the coverage of the Comprehensive Agrarian Reform Program."
The pertinent rules of statutory construction state —
"When the interpretation of a statute according to the exact and literal import of its words would lead to absurd and mischievous consequences, or would thwart or contravene the manifest purpose of the legislature in its enactment, it should be construed according to its spirit and reason, disregarding or modifying so far as may be necessary, the strict letter of the law."
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(Black, Statutory Construction cited in Gonzaga, Statutes and their Construction, 1969 Ed., p. 79)
"If to construe a stature according to the exact and literal import of the words would lead to absurdity, its letter may be disregarded to follow the reason for its enactment." (Lopez vs. Court of Appeals, G.R. No. L-9272, February 1, 1957) (emphasis supplied)
ACCORDINGLY, in view of all the foregoing and solely for purposes of CARP coverage, the processing of the Voluntary Offer to Sell (VOS) of these properties, although transferred/acquired on or after 15 June 1988, may be allowed. This is without prejudice, however, to the determination by the proper forum of the issue of illegal/irregular transfer, if raised, and to the incidents and legal consequences thereof. AcSIDE
We hope to have clarified the matter and please be guided accordingly.
(SGD.) RICARDO S. ARLANZA
Undersecretary for Policy, Planning and
Legal Affairs Office