G.R. No. 176448 - Dailisan vs. Court of Appeals

The dispute involves petitioners, the heirs of Arcadio Castro, Sr. (represented by Arcadio Castro, Jr.), and respondents, including Renato Lozada and co-applicants.
The subject matter is Lot No. 546, Cad 320-D, a rice land within the Buenavista Estate in San Ildefonso, Bulacan, with an aggregate area of 274,180 square meters.

Since the 1940s, respondents recognized Arcadio Castro, Sr. as their landlord, although records later indicated that the registered claimant was “Arcadio Cruz.”
In April 1977, respondents filed applications with the DAR-Bulacan Provincial Office to purchase Lot No. 546 as occupants/tillers under the provisions of Commonwealth Act (C.A.) No. 539.

Records show that Arcadio Castro, Sr. purportedly made payments on behalf of respondents.

In 1944, payments amounting to P5,091.80 were made, evidenced by an official receipt (OR No. 5429266) and supported by a certification from the MAR Bulacan District Office.
Additional payments reportedly made in 1961 amounted to P1,181.77 and P530.52, as attested by an affidavit executed by Jacobe Galvez.

Discrepancies in names and documentary evidence (i.e., “Arcadio Cruz” versus “Arcadio Castro, Sr.”) led to conflicting interpretations of rightful ownership.

Land Inspector Rogelio I. Estrella recommended issuance of clearance to respondents based on the available records.
Documents forwarded to Acting District Officer Cesar C. Jimenez and later evaluated by Benjamin M. Yambao, Trial Attorney II, upheld the right of Arcadio Castro, Sr. over the lot subject to further requirements.

Issues arose regarding compliance with guidelines, particularly the requirement of personal cultivation under LTA AO No. 2, series of 1956.
The Municipal Agrarian Reform Officer (MARO) Jose S. Danganan and later the Provincial Agrarian Reform Officer (PARO) evaluated conflicting documentary evidence and payments.

On May 16, 1991, DAR Regional Director Antonio M. Nuesa issued an Order declaring Lot No. 546 vacant, rejecting the claim of Arcadio Castro, Sr.’s heirs, and giving due course to respondents’ applications.
Secretary Ernesto D. Garilao and later the Office of the President (OP) affirmed the Regional Director’s ruling based on non-compliance with cultivation requirements and alleged violations under LTA AO No. 2.
The Court of Appeals (CA), in its Decision dated March 30, 2004, sustained the findings of the DAR and OP, noting the lack of evidence of a proper application to purchase by Arcadio Castro, Sr. and the failure to prove a vested right.

Petitioners contend that payments made in 1944 and 1961 constituted a perfected contract of sale and that Arcadio Castro, Sr. acquired legal or equitable title through acquisitive prescription.
They argue that the administrative officials acted arbitrarily by relying on an incomplete report (prepared by MARO Danganan) which omitted vital documentary evidence.
It is further argued that, at the time of respondents’ applications, the provisions of C.A. No. 539 applied only to them and not to Arcadio Castro, Sr., who was allegedly beyond being merely a claimant.

C.A. No. 539 provides the framework for the acquisition and subdivision of lands for bona fide tenants or individuals who will personally work the land.
Subsequent orders, particularly LTA AO No. 2 and DAR AO No. 03-90, emphasize the requirement of personal cultivation and occupation as a condition for the award of land titles.
The policy under the 1987 Constitution, which favors landless farmers and farm workers, underpins the decision to award Lot No. 546 to the actual occupants (respondents) rather than to absentee or non-cultivating claimants.

Whether Arcadio Castro, Sr. acquired a vested or preferential right over Lot No. 546 based on payments allegedly made on his behalf.
Whether the evidence provided is competent and sufficient to establish a perfected contract of sale.

Whether the requirement of personal cultivation, as stipulated in LTA AO No. 2, can be applied retroactively in cases involving lands acquired under C.A. No. 539.
The validity of enforcing this requirement on petitioners who, despite being the recognized tenants, allegedly transitioned into the role of absentee landlords.

Whether the DAR and OP erred in giving due course to the applications of respondents (actual occupants/tillers) over the claim of Arcadio Castro, Sr. and his heirs.
Consideration of whether the administrative and evidentiary records suffice to sustain the award in light of the conflicting claims and documentary discrepancies.