October 11, 1996
DAR OPINION NO. 87-96
Mr. Rufino C . Cabang, Jr.
RCJMN Realty Ventures
Corner Cabaluna — National Highway
Panabo, Davao
Dear Mr. Cabang:
This refers to your letter seeking clarification with regard to the land awarded to you covered by TCT No. C-7620 which you intend to improve. You state that no other bank wants to accept your title for loan except the Land Bank; that the Land Bank of Panabo Branch does not like to accept it for loan purposes unless you are a member of a cooperative engaged in rice and corn production; and that your land is suitable to the planting of fruit trees and bananas.
The issues you sought to be enlightened are the following, to wit:
1. You planned to have it repurchased by your parents. Does DAR have any participation? If any, what will it be?
2. If it will be repurchased, what kind of title will they receive?
3. Is there a way of amending R.A. 6657 so other banks can be compelled to accept this DAR-issued titles as collaterals for loans?
Anent your plan to convey your awarded land to your parents, Section 27 of CARL explicitly prohibits the transfer of an awarded land or a portion thereof within ten years from awarded except through hereditary succession or to the government or to the Land Bank of the Philippines or to other qualified beneficiaries. Moreover, the provisions of Executive Order No. 228 dated July 17, 1987 and DAR Administrative Order No. 8, Series of 1995, when taken together provides that ownership of lands acquired by a farmer-beneficiary may be transferred after full payment of amortizations, provided the following shall be observed: a) That the productivity of the land shall be maintained; b) That the buyer (your parents) will not exceed the aggregate landownership ceiling provided by law; and (c) That the ownership ceiling of five (5) hectares shall be imposed.
Anent your query on whether DAR has any participation in case the transfer is allowed, please be informed that this Department through its Field Officers will process and evaluate the Application for Transfer and thereafter, if said application is found to be in order, the DAR Regional Director concerned, shall issue an Order of Approval, approving the requested transfer. (For detailed information, please find attached copy of DAR Administrative Order No. 8, Series of 1995.)
As regard your query on what title will be issued in case the transfer is allowed, A.O. No. 8, Series of 1995 provides that Transfer Certificate of Title (TCT) shall be issued by the Land Registration Authority.
We remind you, however, that an awardee who shall dispose of his/her landholding shall no longer be qualified to became a beneficiary under CARP.
Anent your last query, please be informed that the DAR Guidelines Drafting Committee had prepared a draft guidelines on matters similar to that raised in your letter. Said draft will be submitted to the Executive Committee for deliberation and/or approval.
We hope to have clarified the matters with you.
Very truly yours,
(SGD.) LORENZO R. REYES
OIC-Undersecretary
LAFMA
Copy furnished:
Honorable Neptali Gonzales
Senate President
Senate, Manila
Honorable Jose de Venencia
Speaker, House of Representative
Honorable Salvador H. Escudero III
Secretary of Agriculture
Quezon City
OSEC
Doc. No. 96090247