Title
Canas-Manuel vs. Egano
Case
G.R. No. 198751
Decision Date
Aug 19, 2015
Dispute over CLOA validity; DARAB lacked jurisdiction as no tenancy relationship existed; SC nullified rulings, remanded case for proper forum.
nullification of coverage
prohibited collateral attack
procedural infirmity
A

Case Summary (G.R. No. 198751)

Factual Background

In 2004, respondent and his spouse Tarcelita filed with the DARRO, Region VIII, Tacloban City a “Petition for Nullification of Coverage and Disqualification of Farmer-Beneficiary.” They challenged the issuance of CLOA No. 00091138 to petitioner Flor Canas-Manuel and her sister Salome Dellera Canas over Lot 3595, Csd. 726-D in Barangay Palarao, Leyte, Leyte. Respondent claimed that a portion of the land measuring approximately 3,655.50 sq. ms., covered by the CLOA, had been previously sold to him by petitioner’s father, Celedonio Canas, and that petitioner and her sister were not qualified as farmer-beneficiaries because they were not the actual tillers of the portion purportedly sold to respondent.

In an Order dated October 28, 2004, DAR Regional Director Tiburcio A. Morales, Jr. granted the petition. He declared the award in favor of petitioner and her sister over the farmlot embraced by CLOA No. 00091138 null and void ab initio, directed delineation and coordination for the correction of farmer-beneficiary identification, ordered the MARO to identify and document the rightful farmer beneficiaries, and required petitioner to coordinate with the DARPO legal division to file the proper petition with the adjudication board for the cancellation of the CLOA.

Petitioner moved to reconsider the October 28, 2004 order, but the motion was denied. No appeal was taken within the remaining fifteen (15)-day period, and the order became final and executory.

Following the Regional Director’s directive, on January 24, 2005, respondent filed with the DARAB-Region VIII a “Petition for Cancellation of CLOA No. 00091138,” docketed as DARAB Case No. R-0800-0042-05. In a decision dated February 16, 2006, PARAD Wilfredo M. Navarra ordered the cancellation of CLOA No. 00091138 and its corresponding OCT No. 3324, basing the cancellation on the October 28, 2004 directive.

Petitioner sought reconsideration, but the PARAD denied it in a resolution dated May 8, 2006. Petitioner then appealed to the DARAB Central Office in Diliman, Quezon City, docketed as DARAB Case No. 14579. In a decision dated May 29, 2007, the DARAB dismissed the appeal, reasoning that the cancellation was an adjunct and necessary consequence of the Regional Director’s declaration and that the DARAB was bound to honor the final October 28, 2004 order. The DARAB also denied petitioner’s motion for reconsideration in a resolution dated October 9, 2007.

Petitioner then elevated the case to the Court of Appeals via a Petition for Review under Rule 43. In its February 18, 2011 Decision, the Court of Appeals affirmed the DARAB. It ruled that matters such as alleged violation of due process, illegality of sale, and irregularities of finality were linked to administrative implementation of agrarian laws and lay beyond the DARAB’s jurisdiction. It also held that the DARAB had no appellate jurisdiction over acts of DAR Regional Directors and that jurisdiction could not be invoked under the cited rules because an agrarian dispute or tenancy relationship was not shown to exist.

Petitioner’s motion for reconsideration was denied in the August 31, 2011 Resolution, prompting the present petition for review on certiorari.

The Parties’ Contentions

Petitioner assailed the Court of Appeals’ disposition as technical and alleged that the appellate courts ignored substantive issues. She argued that the Court of Appeals erred in holding the October 28, 2004 order incapable of disturbance and maintained that the order could not attain finality because it was illegal, null and void. She emphasized her asserted qualification as a farmer-beneficiary and detailed that she had been identified as such since May 1985 for a farm lot of 3,895 sq. m. in Barangay Palarao, Leyte, Leyte, originally owned by her parents Celedonio and Floriana Canas and designated as Lot No. 3592, Cad. 726-D. She further stated that the survey plan was approved on November 17, 1986 after a survey conducted in December 1985, and that on May 31, 1993, she received CLOA No. 00091138 and OCT No. OC-3324 contained in one document registered on June 30, 1993. She claimed she had cultivated the land and paid taxes since that time.

Petitioner insisted that respondent’s petition was procedurally infirm. She argued that the filing of respondent’s petition for nullification and disqualification with the DARRO had prescribed because it was brought more than eleven (11) years after registration of the CLOA with the Register of Deeds. She also asserted that respondent’s action constituted a prohibited collateral attack on her title. On the substantive plane, she contended that the allegedly sold portion was not the actual lot covered by her CLOA. She argued that CLOA No. 00091138 covered Lot No. 3592, not Lot No. 3595 as alleged by respondent. She further argued that the Regional Director exceeded authority when he ruled on issues relating to ownership allegedly stemming from respondent’s acquisition from her parents, because ownership matters belong to courts. Lastly, even assuming the alleged sale occurred, she argued that the sale to respondent was prohibited under Section 73(e) of R.A. No. 6657, and therefore could not ground her disqualification or the cancellation of her CLOA and OCT.

Petitioner additionally challenged the procedural and jurisdictional validity of the DARAB cancellation petition, contending that it was also time-barred and constituted another prohibited collateral attack.

In his comment, respondent countered that the petition for review suffered from a procedural defect. He alleged that petitioner failed to furnish him copies of annexes referred to in the petition, including copies of the October 28, 2004 order and the decisions of PARAD Navarra and the DARAB Central Office. He maintained that the October 28, 2004 order of the Regional Director was legal, binding, and already final and executory. Petitioner replied that she had furnished the respondent with the required annexes, asserting that those attachments were the same ones submitted with the earlier Court of Appeals petition.

Issues and Jurisdictional Framework

The Supreme Court determined that the petition warranted review despite the general limitation of a Rule 45 petition to questions of law, because the case substantially raised factual and substantive questions. It found that glaring procedural and substantive errors had been committed and overlooked by the DARAB and the Court of Appeals and it therefore reviewed the facts and the proceedings before the DARAB and the DARRO.

A central issue was whether the cancellation proceedings were conducted with proper jurisdiction. The Supreme Court scrutinized the procedural path chosen by respondent after the October 28, 2004 Regional Director order. It recalled that respondent’s original DARRO petition sought nullification of coverage and disqualification, and that the prayer for relief included cancellation of CLOA No. 00091138 as null and void. In the October 28, 2004 order, however, Dir. Morales declared the CLOA null and void but did not directly order cancellation. Instead, he directed respondent to coordinate with the DARPO-Leyte legal division for the filing of the proper petition for cancellation with the adjudication board.

The second issue concerned the authority of PARAD and the DARAB to entertain and resolve the cancellation petition. Under Section 50 of R.A. No. 6657 and Section 17 of E.O. No. 229, the DAR was vested with primary and exclusive jurisdiction to determine and adjudicate all matters involving the implementation of agrarian reform. The Court also relied on the 2003 DAR Administrative Order 03 rules for agrarian law implementation cases, which defined ALI cases under Rule I and enumerated categories under Section 2, Rule I including the classification, identification, inclusion, exclusion, qualification, or disqualification of farmer-beneficiaries.

The Court then treated the question of whether the cancellation petition involved an agrarian dispute or tenancy relationship, because, as the Court stated, DARAB jurisdiction required such existence between the parties. It applied the statutory definition of agrarian dispute under Section 3(d) of R.A. No. 6657, which covers controversies relating to tenurial arrangements over lands devoted to agriculture, including disputes relating to compensation and transfer terms. The Court noted that where parties both claim to be owners and actual tillers, an agrarian dispute or tenancy relationship could not be readily inferred for purposes of DARAB jurisdiction.

Ruling of the Courts Below

The Supreme Court examined the mechanics of the proceedings that led to cancellation. It identified that after Dir. Morales’s October 28, 2004 order, respondent filed the cancellation petition with the DARAB-Region VIII on January 24, 2005. The petition was decided by PARAD Navarra, who cancelled the CLOA and OCT. In the PARAD proceedings, petitioner objected and raised defenses, including alleged denial of due process and illegality of the sale. Yet PARAD Navarra did not address those matters on the merits. Instead, the PARAD stated that the issues were tied to administrative implementation of agrarian laws and were therefore beyond DARAB jurisdiction. The PARAD then cancelled the CLOA and OCT following Dir. Morales’s directive.

The DARAB Central Office affirmed. It stressed that cancellation was an offshoot of the October 28, 2004 decision, that the declaration of disqualification was an exercise of delegated authority, and that the DARAB was bound to honor the final order. It also repeated that objections relating to due process and alleged illegality could not be entertained because the issues were beyond the DARAB’s jurisdiction.

The Court of Appeals affirmed this approach. It ruled that objections concerning due process, illegality of the sale, and irregularity of certificate of finality could not be ventilated in the DARAB because they we

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