Issuing authority, effectivity, and timeline
- Act No. 1120 was enacted on April 26, 1904 by the Philippine Commission.
- The Act takes effect on its passage.
- The Act expressly expedites passage based on the public good requiring speedy enactment, using the procedure under Section 2 of “An Act prescribing the order of procedure by the Commission in the enactment of laws” passed September 26, 1900.
Legal framework and predecessors cited
- The Act is implemented pursuant to Sections 63, 64, and 65 of the U.S. Act approved July 1, 1902, which includes authorization to lease the lands for a period not exceeding three years and to sell them on terms prescribed, with bond-related limitations.
- The Act cross-references:
- Act No. 926 (the Public Land Act) for limited procedure by reference where specified (e.g., sales of vacant lands “as provided in chapter two”).
- Act No. 1034 for issuance of the bonds used for paying the purchase price (as referenced in the Act’s provisions).
- Act No. 1190 for foreclosure-of-mortgage procedures (as referenced for enforcing the Government lien).
- Land Registration Act (Section 122) for issuance and effectiveness of deeds.
- The Act implements bond security through a trust/sinking-fund structure tied to the Secretary of War–issued bonds described in the Act.
Government officers, roles, and engagements
- The Civil Governor is authorized and directed to examine title sufficiency and soundness for the contracted Friar Lands.
- The Civil Governor’s employment of the law firm Del Pan, Ortigas and Fisher (attorneys at law in Manila) to examine titles and provide legal services is approved and confirmed.
- Del Pan, Ortigas and Fisher are compensated at $5,500 per annum, payable monthly, for as long as the Civil Governor needs their services.
- The Consulting Engineer to the Commission must conduct careful surveys to determine the accuracy and certainty of the amount of land in each tract specified in the purchase contracts.
- The Chief of the Bureau of Public Lands must receive, take charge of, preserve, transmit for registration, administer, report, and enforce rights and obligations under the Act.
- The Attorney-General must be given the Civil Governor’s submission of reports and deeds for opinion.
- The Secretary of the Interior must approve leases and sales made by the Chief of the Bureau of Public Lands.
Transfer, surveys, title examination, and registration
- The Civil Governor must direct the examination of titles to ascertain whether the titles are perfect and indefeasible.
- Upon completion of title perfection and tender of proper conveyance instruments by the sellers/corporations, the Civil Governor must direct payment to the sellers in the sums agreed under the purchase arrangements.
- Payment is drawn by government warrants upon the sum realized from the sale of bonds issued as provided in Act No. 1034.
- After titles vest in the Government, lands fall under the immediate control and direction of the Bureau of Public Lands.
- The Chief of the Bureau of Public Lands must receive and preserve, pending completion of purchase, contracts of sale and purchase, all documents/title deeds/papers, and held notes, surveys, and other data, and preserve deeds later made pursuant to the contracts (except as needed for registration).
- Title deeds and instruments of conveyance must be transmitted to the register of deeds of each province where any part of the lands lies, for registration in accordance with law.
Settlers, occupants, leasing limits, and vacancy handling
- After vesting (or sooner by direction of the Civil Governor), the Chief of the Bureau of Public Lands must identify actual, bona fide settlers and occupants in possession, including names, residences, extent of holdings, and the character and value of holdings.
- The Chief must ask occupants whether they desire to purchase their holdings on the terms provided in the succeeding sections.
- If an occupant does not desire to purchase but desires to lease, the Chief must:
- require execution of a lease in due form to the Government; and
- ensure payment of a reasonable rental fixed by the Chief.
- No lease may be made for a longer term than three years.
- If the Chief finds lands vacant, the Chief must take possession and charge of them and may either:
- lease them for a term not exceeding three years, or
- offer them for sale for the best interests of the Government, in accordance with chapter two of the Public Land Act (Act No. 926).
People who decline to buy or lease
- If the Chief finds persons in possession who decline either to buy or to rent as provided, the Chief must:
- take possession peaceably if possible; or
- begin proper legal proceedings in the Court of Land Registration to settle title and oust them from their holdings.
- Upon adjudication in favor of the Government, the Chief takes possession with the same power as if the lands were originally vacant.
- The Chief must not sell any of the main hacienda houses or other large and substantial buildings unless authorized by a resolution of the Commission.
Purchase rights, valuation, payment terms, and installments
- Actual, bona fide settlers and occupants at the time the lands were conveyed to the Government may purchase the land they occupy at the actual cost to the Government.
- Purchasers are allowed ten years from the date of purchase to pay in equal annual installments.
- Deferred payments bear interest at 4% per annum.
- The Chief must determine the actual value of each parcel held by each settler/occupant by considering:
- location and quality of the holding; and
- other circumstances giving it value.
- Valuation must be set so far as practicable that the aggregate of values of holdings within a particular tract equals the Government’s cost of the entire tract, including cost of surveys, administration, and interest upon the purchase money up to the time of sale.
- The Chief must issue a certificate stating in detail that the Government agrees to sell the settler/occupant the specific land amount held at the fixed price, payable under the Act, and that after payment of the final installment plus accrued interest, the Government will convey the land by proper instrument of conveyance effective under Section 122 of the Land Registration Act.
- When issuing a certificate, the Chief must take the settler/occupant’s formal receipt showing delivery of the certificate.
- Acceptance of the certificate constitutes agreement to pay the purchase price and interest in the installments specified, making the settler/occupant a debtor to the Government for that amount plus accrued interest.
Cash option and agreement requirement
- A settler/occupant may pay in cash or within a shorter period than the specified installment period.
- If payment is made in cash, the land must be conveyed immediately upon completion of the transaction as provided in the Act.
- A settler/occupant who desires to purchase must agree to purchase by accepting the certificate and executing the receipt when called upon by the Chief of the Bureau of Public Lands.
- Failure to comply with the agreement/receipt requirement is treated as a refusal to purchase, resulting in ouster as provided for in the Act, after which the holding may be leased or sold as for unoccupied lands.
Interim tenancy pending precise valuation
- The Chief of the Bureau of Public Lands may require a settler/occupant who desires to purchase to enter into a lease to the Government pending the investigation needed to fix the precise extent and cost.
- The interim lease requires payment of a reasonable rent, and no such lease may exceed three years.
- Refusal by a settler/occupant desiring to purchase to execute the interim lease is treated as refusal to lease or to purchase, and the Chief proceeds to oust under the Act.
Rent and installment collection; government reservation of title
- The Chief must collect and receive all rentals and installment payments of purchase money and interest due and payable under the Act.
- The Chief must issue proper receipts and acquittances and keep proper records in the Bureau of Public Lands’ books.
- The Government reserves title to each parcel sold until full payment of all installments of purchase money and interest.
- Any sale or encumbrance by the purchaser before full payment is invalid as against the Government and subordinate to the Government’s prior claim.
Death of certificate holder; succession and assignments
- If a certificate holder dies before the Government executes the deed, the holder’s widow is entitled to receive the deed if the widow shows compliance with legal requirements for the purchase.
- If the certificate holder dies before deed issuance and leaves no widow, the certificate holder’s interest descends and the deed issues to those who would have taken under Philippine laws had title been perfected before death, upon proof of their compliance with the certificate requirements.
- If the certificate holder sold the interest before full compliance, the purchaser from the certificate holder is entitled to the certificate holder’s rights upon presenting the assignment to the Chief of the Bureau of Public Lands for registration.
Delinquency, forfeiture, enforcement, and foreclosure
- If a lessee or purchaser fails to pay rent or any installment of purchase money and interest thereon when due or when it matures, the Chief must protect the Government from loss immediately.
- For delinquent leases, the Chief is empowered to declare the lease forfeited with proper entry in the office books and notice to the tenant, and then enter upon and take possession of the land.
- For delinquent purchasers, the Chief may:
- sue to recover past due installments and interest; and
- enforce the Government’s lien against the land by selling it under the procedure provided by Act No. 1190 for foreclosure of mortgages.
- A purchaser at a sale under this enforcement mechanism acquires a good and indefeasible title.
- Sale proceeds are applied first to court costs and all installments due or to become due.
- If proceeds cover all delinquent installments, all future installments, and litigation costs, there is no further claim or liability against the original purchaser.
- If proceeds exceed amounts needed to pay Government obligations and costs, the surplus must be returned to the original purchaser or to the person entitled thereto.
Approvals required and irrigation water limits
- No lease or sale made by the Chief of the Bureau of Public Lands under the Act is valid until approved by the Secretary of the Interior.
- Purchasers and lessees acquire no exclusive rights to any canal, ditch, reservoir, or other irrigation works or water supply on which irrigation depends.
- All irrigation works and water supplies remain under the exclusive control of the Government of the Philippine Islands and are administered under the Chief of the Bureau of Public Lands for the common benefit of dependent interests.
- The Government reserves, as part of each contract of sale, the right to levy an equitable contribution or tax for maintenance of irrigation works, assessed based on the amount of benefits received, and acceptance of the certificate of sale or deed binds the purchaser to assent to such levy.
- Lands leased or conveyed remain subject to the right of way of irrigation canals, ditches, and reservoirs as existing or as the Government may later construct.
Public servitudes and nonalienable tracts
- Lands held by titleholders under the Act remain subject to public servitudes existing on private lands under Spanish sovereignty, including servitudes related to:
- littoral of the sea; and
- banks of navigable rivers and rivers upon which rafting may be done.
- The Civil Governor, when authorized by resolution of the Commission, may by proclamation designate tract(s) as nonalienable and reserve them for public use.
- Designated nonalienable tracts are not subject to sale, lease, or other disposition under the Act.
Reporting, funds, forms, and appropriation
- The Chief must submit quarterly reports, through the Secretary of the Interior, to the Commission detailing:
- lands leased or sold;
- amounts derived from rentals and sales; and
- other information the Chief considers valuable for administration and disposition.
- The Secretary of the Interior and the Chief may require advice and assistance from the special counsel named for the legal services under the Act, and it is the duty of the counselors to provide such assistance.
- All moneys received by the Chief from leasing/sale and from interest on deferred payments must be promptly deposited in the Insular Treasury.
- The Treasurer must hold these moneys separately from general insular funds as a trust fund for payment of principal and interest of seven million two hundred and thirty-seven thousand dollars of bonds issued and sold by the Secretary of War to raise money to pay purchase price for Friar Lands pursuant to Sections 63, 64, and 65 of the July 1, 1902 U.S. Act.
- The trust fund also constitutes a sinking fund at maturity and may be invested and reinvested in safe interest-bearing bonds or other securities, which must also be held as part of the sinking fund.
- Interest, dividends, or profits from those investments become part of the sinking fund and may be reinvested.
- Purchases of bonds or other securities by the Treasurer require approval of the Secretary of Finance and Justice.
- The Chief, under supervision of the Secretary of the Interior, must prepare and issue forms and instructions consistent with the Act necessary to carry out provisions administered under the Bureau of Public Lands and conduct proceedings under the Act.
- The Act appropriates PHP 10,000 (Philippine currency) from any Insular Treasury funds not otherwise appropriated for paying the special counsel’s salary and for making the investigations and surveys required by the Act, and for general carrying out of the provisions.
Severability and repeals
- The Act contains no severability or sunset clause.