September 4, 1998

DAR OPINION NO. 93-98

ATTY . VICENTE ASELO S . SICAT

Chief, Legal Division

DAR-Region III

PEDMAR Bldg., Dolores

Sari Fernando, Pampanga

Dear Atty. Sicat:

This refers to your letter dated 23 April 1998 seeking opinion on who as between the Development Bank of the Philippines (DBP), Asset Privatization Trust (APT) and the Land Bank of the Philippines (LBP) is legally bound to accept payments from farmer-beneficiaries for the value of the lands awarded to them.

As culled from your letter together with the appended documents therein, the subject property has an aggregate area of 266.0766 hectares located at Barangay Dampe, Floridablanca, Pampanga and registered in the name of DBP under Transfer Certificate of Title No. 265171 (now TCT No. 306460-R); that said landholding is previously owned by Central Azucarera Refineria de Bataan (CAREBI) until the subsequent transfers to DBP, APT and to the DAR pursuant to Executive Order No. 407; that prior to the enactment of Republic Act No. 6657 (Comprehensive Agrarian Reform Law), the DBP through its Board of Governors approved Resolution No. 0816 dated 17 April 1985 wherein the subject lots were offered for sale to farmer-beneficiaries; that 23 of the FBs have already acquired their respective landholdings through cash payment, while others opted on installment basis; that as a result thereof the Municipal Agrarian Reform Officer (MARO) of Floridablanca, Pampanga documented the claim folders pursuant to Executive Order No. 407 and 448 on the basis of the agreed valuation of the land between the DBP and the FBs; that surprisingly, the LBP rejected the agreed valuation and insisted a higher price thereof but the FBs concerned refused to this valuation; and that on 09 February 1996 then Regional Director Eugenio B. Bernardo issued an Order directing the DAR to make the necessary coordination with the LBP and other agencies concerned regarding the processing and issuances of CLOAs to farmer-beneficiaries pursuant to Executive Order No. 407.

Section 64 of R.A. No. 6657 categorically provides that "the Land Bank of the Philippines shall be the financial intermediary for the Comprehensive Agrarian Reform Program (CARP), and shall insure that the social justice objectives of the CARP shall enjoy a preference among its priorities." From the aforequoted, it is therefore incumbent upon the Land Bank, being the legally mandated custodian of agrarian reform funds, to accept payment from farmer-beneficiaries of their amortizations until their landholdings have been fully paid. This assigned duty holds true notwithstanding that it is opposed to the previous valuation since the title of the subject landholdings has already been transferred to the Republic of the Philippines.

Moreover, sound public policy dictates that qualified farmer-beneficiaries should not be unduly stymied and accorded a run around treatment with no place to go as their sincerity to pay is manifest. Otherwise, this will constitute an unwarranted derailment in the successful implementation of the Program. Any question as to the alleged insufficiency of the valuation should be decided by competent authority upon proper petition by the Land Bank in accordance with existing agrarian laws, rules and regulations but, for the meantime, acceptance of the FBs payment should be a matter of ministerial duty on the part of LBP in view of its aforequoted legally mandated task. Likewise, documentation, generation and issuance of CLOAs may continue pending proper determination on the merits of the issue of valuation.

Attached is the entire case folder for your proper disposition. We hope to have clarified the matter with you and please be guided accordingly.

Very truly yours,

(SGD.) DANILO T. LARA

Undersecretary for Legal Affairs, and Policy and Planning

Copy furnished:

Renato F. Herrera

OIC-Regional Director

DAR-Region III

PEDMAR Bldg., Dolores

San Fernando Pampanga