G.R. No. 111399 - Pecho vs. Sandiganbayan

The case involves petitioners Froilan NagaAo, NiAa Paulene NagaAo, and Teresita Fajardo versus respondents Luis Tanjangco, Antonio Angel Tanjangco, Teresita Tanjangco-Quazon, and Bernardita Limjuco.
The dispute centers on the validity and effects of retention rights under the land transfer program implemented through Presidential Decree No. 27 (PD 27), also known as the Tenants Emancipation Decree, and related agrarian reform laws.

The subject property is a 238.7949‑hectare tract located in Brgy. Mambangan, San Leonardo, Nueva Ecija, originally covered by Transfer Certificate of Title (TCT) No. 1221012.
On October 21, 1972, the property was placed under the government’s land transfer program pursuant to PD 27.
Initially, the title was held partly in the name of the Spouses Jose Tanjangco and Anita Suntay (for 144 hectares) and partly in the name of respondents and their two siblings (for 95.5845 hectares).
Emancipation patents were subsequently issued in favor of the tenant-beneficiaries, and on April 7, 1983, the 144‑hectare portion was transferred to the respondents and their siblings under a new TCT (No. 177766).
On October 5, 1999, the respondents filed an application for retention of five hectares each under Republic Act No. 6657 (the Comprehensive Agrarian Reform Law), with the application covering specific subject lots (including, inter alia, Lot Nos. 72, 77, 133, 134, 137, and 153).

Denied the respondents’ application for retention on the ground that each respondent owned more than 24 hectares of tenanted rice or corn lands, in violation of DAO 04‑91 (Supplemental Guidelines under PD 27).
The order explicitly affirmed that the land remained under PD 27’s coverage.

On March 26, 2009, the DAR Secretary affirmed the Regional Director’s ruling based on respondents’ ownership of additional agricultural lands, which further disqualified them from retention.
Respondent Luis then filed a motion for reconsideration which led to the October 1, 2009 Resolution reversing the previous order and granting respondents retention of five hectares each after noting that the beneficiaries met the “compact and contiguous” requirement under Section 6 of RA 6657.

Petitioners filed a motion for reconsideration of the October 1, 2009 Resolution; however, it was denied by the DAR Secretary in the subsequent June 16, 2010 Resolution, on procedural grounds (related to prohibited pleading rules under DAO 03‑03).
The petitioners then escalated the matter to the Office of the President. In the March 10, 2011 Decision, the Office of the President reinstated the earlier decisions (the Regional Director’s and DAR Secretary’s decisions that denied retention), holding that the respondents did not qualify for retention because of their excessive landholding.

The Court of Appeals, in its decision, reinstated the October 1, 2009 and June 16, 2010 Resolutions issued by the DAR Secretary.
It held, among other things, that:

Petitioners’ appeal before the Office of the President was belated, rendering the approved retention resolution final and executory.
Petitioners were without personality to oppose the retention application since the transfers to them of the subject lots were made in violation of PD 27.

Petitioners sought review of the Court of Appeals’ reinstatement of the retention-granting resolutions, raising issues regarding their real-party-in-interest status, timeliness of the appeal, and the substantive entitlement of respondents to retention.

Petitioners argued that they possessed a valid interest in the subject lots by virtue of allegedly having paid for the conversion of the lots (into subdivision units or a fishpond).
The petitioners contended that transfers made under Executive Order No. 228 (EO 228) and the precedent in Heirs of Atienza might validate their interests by rendering ineffective the absolute prohibition on transfer under PD 27.
However, the record indicated that none of the lots appeared in petitioners’ names, and there was no evidence to support the claim that they maintained possession or valid title.

At the core is the application for land retention by the respondents under RA 6657, with the issue complicated by the historical requirements of PD 27 and DAO 04‑91.
The dispute revolves around whether respondents, by virtue of owning more than 24 hectares on the subject property (as originally measured by the filed application), are disqualified from retaining the right to hold five hectares.
Furthermore, the procedural lapse by petitioners in appealing the DAR Secretary’s reversal and their lack of standing as actual, evidential possessors of the subject lots compound the legal controversy.

Whether the petitioners are the real parties in interest given that the subject lots were transferred to them in violation of PD 27.
Whether they have a substantiated claim to possess or maintain an interest in the subject lots.

Whether the petitioners’ appeal before the Office of the President was filed within the reglementary period provided under Section 32, Rule V of DAO 03‑03.
Whether their subsequent motions for reconsideration properly tolled or extended the appeal period.

Whether the respondents are entitled to exercise their right to retain five hectares each under RA 6657 despite the ownership configuration and the additional landholdings.
Whether the inclusion of the entire 238.7949‑hectare property in the application for retention disqualifies respondents under the limitations imposed by DAO 04‑91.