Agrarian Reform Case Digests
Agrarian Reform Case Digests
Agrarian Reform Case Digests
Sec 31 of the CARP Law allows either land transfer or stock On the other hand, FARM, an intervenor, asks for the
transfer as two alternative modes in distributing land ownership invalidation of Sec. 31 of RA 6657, insofar as it affords the
to the FWBs. Since the stock distribution scheme is the corporation, as a mode of CARP compliance, to resort to stock
preferred option of TADECO, it organized a spin-off transfer in lieu of outright agricultural land transfer. For
corporation, the Hacienda Luisita Inc. (HLI), as vehicle to FARM, this modality of distribution is an anomaly to be
facilitate stock acquisition by the farmers. annulled for being inconsistent with the basic concept of
agrarian reform ingrained in Sec. 4, Art. XIII of the
After conducting a follow-up referendum and revision of terms Constitution.
of the Stock Distribution Option Agreement (SDOA) proposed
by TADECO, the Presidential Agrarian Reform Council
Issue 1: W/N PARC has the authority to revoke the Stock Hence, the essential requirements in passing upon the
Distribution Plan or SDP constitutionality of acts of the executive or legislative
departments have not been met in this case.
Yes. Under Sec. 31 of RA 6657, as implemented by DAO 10,
the authority to approve the plan for stock distribution of the Issue 3: W/N Sec 31 of RA 6657 is consistent with the
corporate landowner belongs to PARC. It may be that RA 6657 Constitutions concept of agrarian reform
or other executive issuances on agrarian reform do not
explicitly vest the PARC with the power to revoke/recall an Yes. The wording of the Art XIII, Sec 4 of the Constitution is
approved SDP, but such power or authority is deemed unequivocal: the farmers and regular farmworkers have a right
possessed by PARC under the principle of necessary to own directly or collectively the lands they till.The basic law
implication, a basic postulate that what is implied in a statute is allows two (2) modes of land distribution: direct and indirect
as much a part of it as that which is expressed.Following this ownership. Direct transfer to individual farmers is the most
doctrine, the conferment of express power to approve a plan for commonly used method by DAR and widely accepted. Indirect
stock distribution of the agricultural land of corporate owners transfer through collective ownership of the agricultural land is
necessarily includes the power to revoke or recall the approval the alternative to direct ownership of agricultural land by
of the plan. individual farmers. Sec. 4 EXPRESSLY authorizes collective
ownership by farmers. No language can be found in the 1987
Constitution that disqualifies or prohibits corporations or
Issue 2: W/N the Court may exercise its power of judicial cooperatives of farmers from being the legal entity through
review over the constitutionality of Sec 31 of RA 6657 which collective ownership can be exercised.The word
collective is defined as indicating a number of persons or
No. First, the intervenor FARM failed to challenged the things considered as constituting one group or aggregate, while
constitutionality of RA 6657, Sec 31 at the earliest possible collectively is defined as in a collective sense or manner; in a
opportunity. It should have been raised as early as Nov 21, mass or body. By using the word collectively, the Constitution
1989, when PARC approved the SDP of HLI or at least within allows for indirect ownership of land and not just outright
a reasonable time thereafter. Second, the constitutionality of agricultural land transfer. This is in recognition of the fact that
RA 6657 is not the very lis mota of this case. Before the SC, land reform may become successful even if it is done through
the lis mota of the petitions filed by the HLI is whether or not the medium of juridical entities composed of farmers.The stock
the PARC acted with grave abuse of discretion in revoking the distribution option devised under Sec. 31 of RA 6657 hews
SDP of HLI. With regards to the original positions of the with the agrarian reform policy, as instrument of social justice
groups representing the interests of the farmers, their very lis under Sec. 4 of Article XIII of the Constitution. Albeit land
mota is the non-compliance of the HLI with the SDP so that the ownership for the landless appears to be the dominant theme of
the SDP may be revoked. Such issues can be resolved without that policy, the Court emphasized that Sec. 4, Article XIII of
delving into the constitutionality of RA 6657. the Constitution, as couched, does not constrict Congress to
passing an agrarian reform law planted on direct land transfer
to and ownership by farmers and no other, or else the
enactment suffers from the vice of unconstitutionality. If the is valid and must be complied with. Evidently, the operative
intention were otherwise, the framers of the Constitution would fact doctrine is not confined to statutes and rules and
have worded said section in a manner mandatory in character. regulations issued by the executive department that are
accorded the same status as that of a statute or those which are
ISSUES: quasi-legislative in nature.
I. Whether or not the operative fact doctrine is applicable to (2) As We have succinctly discussed in Our July 5, 2011
the present case Decision, it took the Farmworkers Agrarian
Reform Movement (FARM) some eighteen (18) years from
II. Whether or not Sec. 31 of RA 6657 or the Comprehensive November 21, 1989 before it challenged the
Agrarian Reform Law of 1988 is constitutional constitutionality of Sec. 31 of RA 6657. The question of
constitutionality will not be passed upon by the Court unless it
III. Whether or not the Court properly determined the coverage is properly raised and presented in an appropriate case at the
of compulsory acquisition first opportunity. FARM is, therefore, remiss in belatedly
questioning the constitutionality of Sec. 31 of RA 6657. The
IV. Whether or not the matter on just compensation has been second requirement that the constitutional question should be
correctly passed upon by the Court raised at the earliest possible opportunity is clearly wanting.
The last but the most important requisite that the constitutional
V. Whether or not the subject agricultural lands may be sold to issue must be the very lis mota of the case does not likewise
third parties though they have not been fully paid obtain. The lis mota aspect is not present, the constitutional
issue tendered not being critical to the resolution of the case.
VI. Whether HLI violated any of the provisions under the SDP The unyielding rule has been to avoid, whenever plausible, an
issue assailing the constitutionality of a statute or governmental
VII. Whether or not the ruling that the qualified FWBs should act. If some other grounds exist by which judgment can be
be given an option to remain as stockholders of HLI is valid made without touching the constitutionality of a law, such
recourse is favored. Based on the foregoing disquisitions, We
HELD: maintain that this Court is NOT compelled to rule on the
constitutionality of Sec. 31 of RA 6657.
(1) The Operative Fact Doctrine is not limited to invalid or
unconstitutional laws. Contrary to the stance of respondents, (3) FARM argues that this Court ignored certain material
the operative fact doctrine does not only apply to laws facts when it limited the maximum area to be covered to
subsequently declared unconstitutional or unlawful, as it also 4,915.75 hectares, whereas the area that should, at the least,
applies to executive acts subsequently declared as invalid. The be covered is 6,443 hectares, which is the agricultural land
"operative fact" doctrine is embodied in De Agbayani v. Court allegedly covered by RA 6657 and previously held by
of Appeals, wherein it is stated that a legislative or executive Tarlac Development Corporation (Tadeco). We cannot
act, prior to its being declared as unconstitutional by the courts, subscribe to this view. Since what is put in issue before the
Court is the propriety of the revocation of the SDP, which only yet been issued to the qualified FWBs in the instant case, the
involves 4,915.75 has. of agricultural land and not 6,443 has., 10-year prohibitive period has not even started. Significantly,
then We are constrained to rule only as regards the 4,915.75 the reckoning point is the issuance of the EP or CLOA, and not
has. of agricultural land. the placing of the agricultural lands under CARP coverage.
(4) In Our July 5, 2011 Decision, We stated that "HLI shall (6) AMBALA and FARM reiterate that improving the
be paid just compensation for the remaining agricultural economic status of the FWBs is among the legal obligations
land that will be transferred to DAR for land distribution of HLI under the SDP and is an imperative imposition by
to the FWBs." We also ruled that the date of the "taking" is RA 6657 and DAO 10. FARM further asserts that "[i]f that
November 21, 1989, when PARC approved HLIs SDP per minimum threshold is not met, why allow [stock distribution
PARC Resolution No. 89-12-2. option] at all, unless the purpose is not social justice but a
political accommodation to the powerful."
We maintain that the date of "taking" is November 21, 1989,
the date when PARC approved HLIs SDP per PARC Contrary to the assertions of AMBALA and FARM, nowhere
Resolution No. 89-12-2, in view of the fact that this is the time in the SDP, RA 6657 and DAO 10 can it be inferred that
that the FWBs were considered to own and possess the improving the economic status of the FWBs is among the legal
agricultural lands in Hacienda Luisita. To be precise, these obligations of HLI under the SDP or is an imperative
lands became subject of the agrarian reform coverage through imposition by RA 6657 and DAO 10, a violation of which
the stock distribution scheme only upon the approval of the would justify discarding the stock distribution option.
SDP, that is, November 21, 1989. Thus, such approval is akin
to a notice of coverage ordinarily issued under compulsory (7) Upon a review of the facts and circumstances, We
acquisition. realize that the FWBs will never have control over these
agricultural lands for as long as they remain as
(5) There is a view that since the agricultural lands in stockholders of HLI. In line with Our finding that control over
Hacienda Luisita were placed under CARP coverage agricultural lands must always be in the hands of the farmers,
through the SDOA scheme on May 11, 1989, then the 10- We reconsider our ruling that the qualified FWBs should be
year period prohibition on the transfer of awarded lands given an option to remain as stockholders of HLI, inasmuch as
under RA 6657 lapsed on May 10, 1999, and, consequently, these qualified FWBs will never gain control given the present
the qualified FWBs should already be allowed to sell these proportion of shareholdings in HLI.
lands with respect to their land interests to third parties,
including HLI, regardless of whether they have fully paid Moreover, bearing in mind that with the revocation of the
for the lands or not. The proposition is erroneous. Under RA approval of the SDP, HLI will no longer be operating under
6657 and DAO 1, the awarded lands may only be transferred or SDP and will only be treated as an ordinary private
conveyed after ten (10) years from the issuance and registration corporation; the FWBs who remain as stockholders of HLI will
of the emancipation patent (EP) or certificate of land ownership be treated as ordinary stockholders and will no longer be under
award (CLOA). Considering that the EPs or CLOAs have not the protective mantle of RA 6657.
In addition to the foregoing, in view of the operative fact
doctrine, all the benefits and homelots received by all the
FWBs shall be respected with no obligation to refund or return
them, since, as We have mentioned in our July 5, 2011
Decision, "the benefits x x x were received by the FWBs as
farmhands in the agricultural enterprise of HLI and other fringe
benefits were granted to them pursuant to the existing
collective bargaining agreement with Tadeco."