Title
Heirs of Grino, Sr. vs. Department of Agrarian Reform
Case
G.R. No. 165073
Decision Date
Jun 30, 2006
Juan GriAo's heirs contested land retention under PD 27 and CARL after ceding 50 hectares to DBP. SC upheld DAR's decision, ruling no retention rights due to prior land ownership, valid CLTs, and laches.
certiorari
agricultural land
laches

Case Summary (G.R. No. 165073)

Factual Background

Juan Grino, Sr. owned an agricultural parcel, Lot 1505-B, covered by TCT No. T-53350, with an area of 9.35 hectares, located in Barangay Gua-an, Leganes, Iloilo. He likewise owned a separate parcel of approximately 50 hectares in Barangay Tad-y, Sara, Iloilo, which he mortgaged to the Development Bank of the Philippines (DBP) on February 8, 1972 to secure a loan.

On October 21, 1972, then President Ferdinand E. Marcos issued PD 27, which decreed the emancipation of tenants and transferred to them ownership of the land they till. As a result, Grino’s 9.35-hectare land was placed under PD 27 coverage, and CLTs were issued in favor of Grino’s tenants: Marianito Gulmatico, Ludovico Hubero, Rodolfo Hubero, Placida Catahay, and Roberto Gula.

Grino later filed a letter-petition in the early 1980s seeking cancellation of the CLTs, asserting that they had been issued without giving him an opportunity to be heard, that the land was his only riceland in Leganes, that only a little over 6 hectares were planted with palay, and that the property had sentimental value to him. He also pointed out that some of his children and grandchildren supposedly needed the land for residential purposes. In lieu of the CLT-covered land, he offered seven hectares for each tenant from his separate 50-hectare parcel.

Grino thereafter ceded his 50-hectare Sara property to the DBP via dacion en pago to settle his mortgage obligation. Grino died on July 10, 1985. His wife died on June 22, 1988.

DAR Dismissal of the CLT-Cancellation Petition (1989)

In response to Grino’s petition for cancellation of the CLTs, DAR Regional Director Antonio S. Maraya dismissed the petition by Order dated September 25, 1989. The order cited Letter of Instructions No. 474 (LOI 474) and the implementing framework under MAR Memorandum Circular No. 11 dated April 21, 1978. The governing reasoning was that Grino was an owner of 50 hectares of other agricultural land that rendered him ineligible for exemption or retention under the LOI 474 regime, as implemented at that time. Accordingly, the CLTs issued to the tenants were maintained.

Petitioners’ Later Claim for Retention and the Denial (1997–1998)

Sometime later, the Land Bank of the Philippines notified Grino’s heirs that DAR approved the tenants’ transfer claim under PD 27 and that requirements were being set for the release of proceeds. Petitioners then filed an application for retention dated March 14, 1997 of the 9.35-hectare land, invoking **Section 6 of RA 6657, which sets retention limits and provides, among others, that landowners whose lands were covered by PD 27 may keep the area originally retained by them under that decree. Petitioners contended that Grino had seven children and that if retention were limited to five hectares, the remaining land would be insufficient for his children, especially because the 50-hectare Sara land had already been ceded to the DBP.

Meanwhile, Emancipation Patents were issued to the tenants on June 5 and June 25, 1997. Thereafter, DAR Regional Director Dominador B. Andres dismissed petitioners’ retention application by Order dated April 27, 1998, and denied reconsideration by Order dated August 18, 1998. The April 27, 1998 denial reasoned that the applicable reckoning date for Operation Land Transfer was October 21, 1972, the effectivity of PD 27. It held that RA 6657 could not be treated as the governing law as of that time except in a suppletory manner. The DAR further ruled that, by operation of law as of October 21, 1972, the tenanted landholdings were covered by PD 27 because they were tenanted and Grino owned approximately 50 hectares of other agricultural land in Sara. It held that the conveyance of the 50-hectare Sara land to DBP in 1985 did not legally remove or exempt the tenanted landholdings from PD 27 coverage because the transfer occurred years after PD 27 had already subjected the properties to the land transfer program.

DAR Secretary’s Denial of Appeal (2002) and the Determinative Ruling

Petitioners appealed to the DAR Secretary, arguing in substance that the CLTs were null and void for alleged lack of due process and lack of payment of just compensation; that Grino lacked retention exemption rights because he owned 50 hectares of other land; that the reversion of the Sara property to the DBP was a circumvention of PD 27; and that Grino and the heirs had the right under Section 6 of RA 6657 to choose retained area in substitution of the Sara land.

In Order dated September 3, 2002, DAR Secretary Hernani A. Braganza denied the appeal. The Secretary found that the mortgage in 1972 did not affect the PD 27 analysis because Grino still held naked title when PD 27 took effect. While the Secretary agreed that the reversion via dacion en pago in 1985 was not done in circumvention of PD 27 because the 50-hectare Sara property was untenanted coconut land (thus beyond PD 27 coverage), the transaction was viewed merely as confirming Grino’s ownership at the time PD 27 became effective.

The Secretary concluded that since Grino could not retain any portion of his tenanted riceland in Leganes under PD 27, his heirs who succeeded by operation of succession under the New Civil Code could not retain the same property under PD 27. The Secretary then addressed petitioners’ reliance on RA 6657, stating the principle that where a landowner is not entitled to retention under PD 27, he cannot invoke retention under RA 6657 for the same land. The Secretary reasoned that Grino had no retention rights under PD 27, hence he also had no retention rights under RA 6657, and therefore the heirs could not exercise such rights as successors-in-interest. The Secretary likewise referred to DAR AO 4 (1991) to note limitations regarding retention rights for children of landowners.

Proceedings in the Court of Appeals and the Doctrines of Finality, Res Judicata, and Laches

Petitioners elevated the matter to the Court of Appeals via a petition for review. The appellate court affirmed the DAR Secretary’s denial in a decision dated October 17, 2003. It held that the land fell within PD 27 coverage as a tenanted riceland. It explained that uncertainties existed in early PD 27 implementation, and that by the time LOI 474 was issued, the combined operation of PD 27 and LOI 474 meant that Juan Grino had no right of retention because he owned tenanted riceland and also owned 50 hectares of coconut land. It also noted that tenants had received CLTs during Grino’s lifetime, preparatory to the emancipation patents upon payment of their portions.

Critically, the Court of Appeals ruled that Grino’s objection to CLTs was a pending remedial action that was dismissed by the DAR on September 25, 1989, and that the heirs failed to appeal. It treated the DAR order as a decision on the merits of Grino’s petition for cancellation of CLTs that effectively laid to rest retention issues between Grino, the government, and the tenants. The Court of Appeals therefore applied res judicata and found that petitioners were likewise estopped by laches for raising retention issues roughly seven and a half years after denial had become final, and unjustly attempting to resurrect an issue after tenants had become full-pledged owners.

Petitioners moved for reconsideration, insisting that the DAR Regional Director’s 1989 order allegedly surfaced later and should not bind them; that there was no proper substitution of heirs; that the order was addressed to a dead person and supposedly was not validly served; that a CLT-cancellation petition was not tantamount to an application for retention; and that issuance of CLTs should not bar constitutional retention rights under RA 6657. The Court of Appeals denied the motion for reconsideration by Resolution dated June 21, 2004, holding that the issues were not raised earlier in the proceedings below or in the petition for review, and that it would violate procedural orderliness and fairness for petitioners to claim error based on incomplete or incorrect factual submissions. It also rejected petitioners’ complaint on lack of substitution of heirs, explaining that while DARAB rules lacked a specific provision on death of a party, the Rules of Court impose the duty on counsel to inform the tribunal of a party’s death and designate a representative. The appellate court further stated that ordinary common sense dictates that heirs cannot neglect their duty to monitor the estate of the deceased litigant and notify the tribunal of the death. It thus found no merit in petitioners’ claim that the denial of Grino’s CLT-cancellation petition did not bind them.

Petition for Certiorari Under Rule 65 and the Supreme Court’s Disposition

Petitioners then filed a petition for certiorari faulting the Court of Appeals for alleged grave abuse of discretion. They claimed the appellate court refused to recognize their constitutional right of retention under RA 6657; ignored purported “discoveries” of irregularities allegedly extracted from DAR records only after filing the petition for review; and insisted petitioners had lost retention rights because the 1989 DAR order had become final despite the alleged PARO certifications at the back of emancipation patents and the later “discovery” of the Maraya order within DAR in 1998.

The Court held that the petition was procedurally defective because the proper remedy should have been a petition for review on certiorari under Rule 45 within the reglementary period, but petitioners instead filed under Rule 65. The Court reiterated the rule that certiorari cannot substitute for a lost appeal, and that certiorari lies only when there is no appeal and no plain, speedy, and adequate remedy. It also explained that while it retains discretion to treat a misfiled certiorari petition as one filed under Rule 45 if done within the period, no justification was shown for filing beyond the reglementary time.

Even apart from the technical

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