G.R. No. 136466 ; November 25, 2009
THE HEIRS OF AURELIO REYES, Petitioners, vs. HON. ERNESTO D. GARILAO, as the Secretary of the Department of Agrarian Reform, and EXEQUIEL ROMAN, et al., Respondents.

FACTS

Petitioners are the co-owners of a 99-hectare agricultural land in Bataan, inherited from their parents. The property was placed under the coverage of Presidential Decree No. 27, and emancipation patents were issued to farmer-beneficiaries (respondents) in 1988. In 1993, petitioners filed applications for retention of five hectares each under Section 6 of Republic Act No. 6657 (CARL). The DAR Regional Director granted their applications.
The DAR Secretary reversed the Regional Director’s order, revoking the grant of retention rights. The Secretary found that petitioners owned other non-agricultural properties in Makati and Manila. Applying DAR Administrative Order No. 4, Series of 1991, the Secretary held that landowners who own lands devoted to non-agricultural purposes and derive adequate income therefrom are not entitled to retention rights under CARL.

ISSUE

Whether petitioners are entitled to exercise their retention rights under Section 6 of RA 6657, notwithstanding their ownership of other non-agricultural properties.

RULING

No. The Supreme Court denied the petition and affirmed the Court of Appeals’ decision. The legal logic is anchored on the proper application of DAR Administrative Order No. 4, which implements the retention limits under RA 6657. The Court held that the administrative order, which restricts the right of retention for landowners who own other non-agricultural lands and derive adequate income from them, is a valid exercise of the DAR’s quasi-legislative power. This restriction is consistent with the social justice and distributive justice objectives of agrarian reform, as it ensures that land is distributed to those who need it most.
The Court emphasized that the right of retention is not an absolute right but a privilege granted by the State, subject to reasonable conditions. The finding by the DAR Secretary that petitioners owned other urban properties and presumably derived adequate income was a factual determination supported by evidence. Since the issue involved the reasonableness of an administrative regulation and its application to established facts, the Court found no reason to overturn the concurrent findings of the DAR Secretary and the Court of Appeals. The policy aims to prevent landowners from retaining agricultural land when they already have sufficient means of livelihood from other sources, thereby maximizing land distribution to landless farmers.