G.R. No. 178895 and G.R. No. 179071; January 10, 2011
REPUBLIC OF THE PHILIPPINES, represented by the DEPARTMENT OF AGRARIAN REFORM, through the HON. SECRETARY NASSER C. PANGANDAMAN, Petitioner, vs. SALVADOR N. LOPEZ AGRI-BUSINESS CORP., represented by SALVADOR N. LOPEZ, JR., President and General Manager, Respondent. / SALVADOR N. LOPEZ AGRI-BUSINESS CORP., represented by SALVADOR N. LOPEZ, JR., President and General Manager, Petitioner, vs. DEPARTMENT OF AGRARIAN REFORM, through the Honorable Secretary, Respondent.
FACTS
The case involves four parcels of land owned by Salvador N. Lopez Agri-Business Corp. (SNLABC) in Mati, Davao Oriental, with an aggregate area of 160.1161 hectares. On August 2, 1991, the Municipal Agrarian Reform Officer issued a Notice of Coverage placing the lands under compulsory acquisition pursuant to the Comprehensive Agrarian Reform Law (CARL). SNLABC filed applications for exemption, claiming the lands were used for livestock grazing prior to CARL’s effectivity, citing the Luz Farms doctrine. An onsite investigation confirmed the presence of livestock. The DAR Regional Director denied the exemption for Lots 1454-A and 1296 (the Limot lands), stating it was not clearly shown they were actually, directly, and exclusively used for livestock raising, but approved the exemption for the other two lots. SNLABC appealed, also arguing the Limot lands were reclassified as a Pollutive Industrial District. The DAR Secretary affirmed the denial for the Limot lands and also declared the other two lots (Lots 1298 and 1293-B, the Lopez lands) as covered by CARP, doubting SNLABC’s claim of long-term livestock operation and suggesting the 1988 incorporation was an attempt to evade CARL. The Court of Appeals partially granted SNLABC’s petition, excluding the Lopez lands from CARL coverage but upholding the inclusion of the Limot lands. Both DAR and SNLABC filed separate petitions for partial reconsideration, which were denied, leading to these consolidated Rule 45 Petitions before the Supreme Court.
ISSUE
Whether the Lopez and Limot lands of SNLABC can be considered grazing lands for its livestock business and are thus exempted from the coverage of the CARL under the ruling in Luz Farms v. DAR.
RULING
The Supreme Court dismissed both petitions, finding no reversible error in the Court of Appeals Decision. The Court upheld the exemption of the Lopez lands (TCT Nos. T-12637 and T-12639) from CARL coverage, as the evidence established they were used for livestock grazing prior to June 15, 1988. The Court also upheld the inclusion of the Limot lands (Lots 1454-A and 1296, previously under TCT No. T-12635) under CARL, as SNLABC failed to prove these lands were actually, directly, and exclusively used for livestock raising at the time of CARL’s effectivity. The application for exemption for the Limot lands was filed only in 1994, and the claim that they were needed as an “additional area” for grazing indicated they were not principally devoted to livestock. The Court also found that the subsequent reclassification of the Limot lands did not affect their coverage, as the Notice of Coverage was issued prior to the reclassification.