October 26, 1998

DAR OPINION NO. 103-98

PARO VICENTE C . JIMENEZ

DAR — Provincial Office

San Fernando, Pampanga

Dear PARO Jimenez:

This refers to your letter-memorandum dated 18 June 1998 addressed to then Secretary Ernesto D. Garilao, requesting for advice regarding the 48.0629-hectare landholding registered under TCT No. 289486-R in the name of Maria Nieves Toledo, situated at San Jose, Florida, Pampanga covered under Operation Land Transfer (OLT) and CARP but was nonetheless sold to the National Housing Authority by the owner thereof. Specifically, you wish to be advised on what course of action should you take to compel the Register of Deeds to register the pending three (3) collective CLOAs for registration.

You state that a portion of the property consisting an area of 11.8813 hectares was placed under OLT wherein thirteen (13) Emancipation Patents (EPs) were generated, registered and distributed to eleven (11) farmer-beneficiaries in 1995; that a Notice of Coverage was issued and duly received by the landowner on 27 May 1997 placing the remaining 36.1816 hectares under Compulsory Acquisition; that the Claim Folder was forwarded to PARO for evaluation and transmitted to LBP/LVO for valuation on 20 November 1997; that a Memorandum of Valuation for the 36.1816-hectares was issued by LBP/LVO, Region III on 8 December 1997 in the total amount of P786,348.46; that on 9 January 1998, a letter requesting for Exemption Order from the Office of the Secretary was sent by Atty. Proceso Nacino but said request was denied in an Order issued by then Secretary Garilao in March 1998; that on 12 March 1998, LBP issued a certification that the amount of P786,348.46 in cash and bonds has been deposited in the name of the landowner as compensation on the landholding; and that a Memorandum was sent to the Register of Deeds on 18 March 1998 requesting from said Office to issue title in the name of the Republic of the Philippines and to register the three (3) collective CLOA titles in the name of the potential beneficiaries.

You further state that the problem arose when you found out that the title registered in the name of Maria Nieves Toledo (TCT No. 289486) was sold to the National Housing Authority (NHA) covering the whole 48.0629 hectares and a new title (TCT No. 440981) was issued in the name of National Housing Authority on 16 December 1,997 without the knowledge and consent of the farmer-beneficiaries and without DAR clearance.

Hereunder are our comments and recommendations on the legal issues raised therein:

Anent the 11.8813-hectare landholdings which were placed under OLT and wherein thirteen (13) Emancipation Patents were generated, registered and distributed in favor of eleven (11) qualified-beneficiaries in 1995, the same are already legally owned by the farmer-beneficiaries which may only be disposed by them subject to agrarian laws, rules and regulations and by no other (e.g., Maria Nieva Toledo who is no longer the owner thereof), and the EPs may only be cancelled by the DAR Adjudication Board (DARAB) upon proper showing that the farmer-beneficiaries have committed acts and/or omissions violative of agrarian laws, rules and regulations (DAR Administrative Order No. 2, Series of 1994). n the other hand, anent the remaining portion of 36.1816 hectares which was compulsorily acquired wherein a Notice of Coverage was already issued and duly received on 27 May 1997, it is submitted that a property which is agricultural, and more so if already subjected to compulsory acquisition pursuant to the Comprehensive Agrarian Reform Law, can no longer be the subject of a valid sale by the landowner to any third party including government agencies or government owned or controlled corporations without first securing a DAR clearance.

In view of the foregoing, we submit that the sale of the entire 48.0629 hectares of agricultural land by the partial owner to the National Housing Authority is not a valid transaction. Said sale is a clear violation of the provisions of the Civil Code on ownership, Sections 6 (last paragraph) and 73 (a) of the Comprehensive Agrarian Reform Law, and the provisions of DAR Administrative Order No. 1, Series of 1989. Obviously, the sale was effected by the owner to avoid the application of CARL to her landholdings, hence, the transaction thus made shall perforce be deemed as null and void.

Accordingly, we submit that the DAR, as the lead agency mandated to implement the CARL (R.A. No. 6657), can file a petition before the proper court or forum for: 1) the cancellation of title issued to NHA on the ground of nullity of the sale and/or fraud and; 2) the registration of the pending collective CLOAs for registration. The sale was a patent nullity because despite the DAR Notice of Coverage and the legal requirement for a DAR Clearance the landowner sold the same to a third party, in this case the NHA, without the knowledge and consent of the farmer beneficiaries and the necessary DAR Clearance, and considering, moreover, that the subject application for exemption was likewise subsequently denied. Thus, the coverage and documentation process may immediately proceed even pending the cancellation proceedings of the title issued to NHA so as not to further delay the implementation of the CARP over the landholdings in issue, in line with the legal mandate of the need to distribute lands to the tillers at the earliest practicable time (5th paragraph, Section 7, R.A. No. 6657 and Sandiganbayan Resolution dated 16 January 1996, Civil Case No. 0033, Republic of the Philippines vs. Cojuangco, et al.).

Please be guided accordingly and we hope to have clarified the matters with you.

Very truly yours,

(SGD.) DANILO T. LARA

Undersecretary for Legal Affairs, and Policy and Planning

Copy furnished:

OSEC Doc. No. 98070452

Director Renato Herrera

DAR Region III

Pedmar Bldg., Dolores

San Fernando, Pampanga