G.R. No. 240184 - Musahamat Workers Labor Union-1-ALU vs. Musahamat Farms, Inc., Farm 1

The case involves a petition for review filed by the Department of Agrarian Reform (DAR) to reverse prior decisions issued by the Court of Appeals regarding land use conversion matters.
The petition challenges the rulings that had allowed the distribution of certain land areas to affected farm workers under the Comprehensive Agrarian Reform Program (CARP).

The Province of Sarangani was created under Republic Act No. 7228 on March 16, 1992.

It consists of seven municipalities, with the Municipality of Alabel as its capital, where national and provincial offices are to be established.

On February 14, 1997, the Sangguniang Bayan of Alabel passed Resolution No. 97-08 endorsing a Ten-Year Municipal Comprehensive Development Plan and Land Use Development Plan and Zoning Ordinance.
On January 30, 1998, pursuant to Municipal Zoning Ordinance No. 08, Series of 1997, the Sangguniang Bayan of Alabel reclassified lots from agricultural to non-agricultural uses to accelerate urbanization.
On March 2, 1998, the Sangguniang Panlalawigan of Sarangani approved a resolution adopting the same planning documents.

Respondents, including Sarangani Agricultural Company, Inc. (SACI), ACIL Corporation, and individuals Nicasio and Tomas Alcantara, are the owners of the lands affected by the reclassification.
SACI filed an application on July 2, 1998, seeking land use conversion for various parcels totaling over 1,000 hectares.

Detailed information was provided regarding each parcel, including titles, lot numbers, and respective areas.
The submission complied with the documentary requirements under DAR Administrative Order No. 7, Series of 1997.

A Site Inspection Report prepared by the HLURB Regional Office was indorsed to DAR, and subsequent inspections were conducted by the Provincial Agrarian Reform Council (PARC) and the Provincial Land Use Technical Committee (PLUTC).
The PLUTC, in its meeting on March 30, 2000, recommended:

The disapproval of 158.0672 hectares planted with bananas and coconuts due to their viability for agriculture and opposition from the Sarangani Agrarian Reform Beneficiaries Association, Inc. (SARBAI).
A deferral of the decision on the remaining area, conditioned on SACI’s submission of a comprehensive development plan and other technical requirements.

On November 9, 2000, DAR Secretary Horacio R. Morales, Jr. issued an order denying SACI’s conversion application based on:

Noncompliance with documentary requirements and failure to secure adequate undertakings to compensate affected farm workers.
Inability to clarify issues regarding areas still viable for agriculture and subject to protest by SARBAI.

Subsequent motions for reconsideration by petitioners were denied by the Court of Appeals in a Resolution dated September 24, 2004.
Respondents then elevated the matter to the Office of the President, which dismissed the appeal on June 30, 2003.
Finally, the Court of Appeals, in its decision dated July 19, 2004, reversed and set aside portions of the previous orders:

It directed DAR to issue a conversion order covering the banana and coconut areas subject to the June 16, 1998 Notice of Coverage under specified terms and conditions.
For the remaining areas, the decision was deferred pending the submission of a revised five-year development plan.

Dispute arose over whether due process was followed in issuing a Notice of Coverage to cover the banana area under CARP.
The contention included:

Alleged irregularities in the issuance of the Notice of Coverage.
The undue significance attached to the protest of SARBAI.
The requirement for a deed of undertaking even after written commitments from SACI.

The contention that commercial farms under the deferment scheme could not be applied for conversion.
Whether irrigated agricultural lands suitable for farming were disqualified from conversion.
The absence of a sufficient five-year comprehensive development plan from the applicant.

Whether the Notice of Coverage was mandatory prior to DAR acquiring the subject lands, particularly those covered by a commercial farm deferment scheme.
Whether the alleged failure to secure such notice amounted to a violation of due process requirements.

Whether DAR is entitled to use the reclassified land use plans and zoning ordinances issued by the local government as the primary reference in evaluating conversion applications.
The extent to which these local plans should dictate the conversion process in light of the statutory limitations under the Comprehensive Agrarian Reform Law (CARL).

Whether SACI met the documentary and procedural requirements stipulated in DAR Administrative Order No. 7, Series of 1997, and related issuances.
The impact of SARBAI’s protests and the adequacy of the undertakings and development plan as required by law.