THE DIRECTOR OF LANDS, PETITIONER, VS. HON. GUARDSON R. LOOD, JUDGE OF THE COURT OF FIRST INSTANCE OF RIZAL, BRANCH VI, AND THE QUEZON CITY DEVELOPMENT AND FINANCING CORPORATION…

SEPARATE OPINION

DE CASTRO, J.:

I concur. Granting the
right to acquire public agricultural lands to qualified corporations as the
Constitution of 1935 does to natural persons who are Filipino citizens, does
not deprive the legislative body the power to make reasonable classification or
distinction as to how such corporations or individual citizens may, respec­tively,
acquire public agricultural lands. Limiting the mode of acquisition by corporations, say by purchase, but
not by homestead, free patent or by judicial confirmation of incomplete or
imperfect title under Sec. 48 of the Public Land Act, as the aforecited Act
does, to my mind, does not offend against the Constitution, particularly the
equal protection clause thereof. The
basis of the classification as indicated is in my opinion plainly and
irrefutably rational and just. It seems
to me beyond doubt that corporations were never intended to acquire public
agricultural lands by homestead or free patent. Similarly, neither should there be anything repugnant to the
Constitution to limit to natural persons (citizens) the acquisition by judicial
confirmation which is nearly akin to that of administrative legalization or by
free patent.

This separate opinion is by way of responding to the dissenting
opinion of Justice Makasiar.

DISSENTING OPINION

MAKASIAR, J.:

The 1935 Constitution
should govern the instant case.

The facts show that the
Quezon City Development and Finance Corporation (QCDFC), 100% owned by Filipino
citizens, filed on January 13, 1970 an application for registration of title
under Act No. 496, as amended, claiming to be the owner of a parcel of land of
about 8,840 sq. m. situated in sitio Malaking Bundok, barrio Dolores of Taytay,
Rizal, which it purchased on December 20, 1969 from Amelia del Rosario and
Fidel del Rosa­rio, who inherited the same from Macario del Rosario, who owned
and possessed the said parcel since 1892 until his death during the Japanese
occupation; and that its possession, together with that of its predecessors-in­-interest,
has been peaceful, continuous, open and adverse in concept of an owner also
since 1892.

The applicant further
prays that, should the application be not favorably considered, he invokes the
provisions of Section 48 of the Public Land Act, otherwise known as CA No. 141,
as amended by R.A. Nos. 107, 1942 and 2061 (pp.
6-7, rec.).

On July 17, 1970, the
Director of Lands, through the Solicitor General, filed an opposition on the
ground that:

“xx                        xx                     xx

“2.  That neither the applicant(s) nor its
predecessors-in-interest possess sufficient title to said parcel(s) of land the
same having been acquired by them either by composition title from the Spanish
Government or by possessory information title under the Royal Decree of
February 13, 1894;

“3.  That neither the applicant(s) nor its
predecessors-in-interest have been in open, continuous, exclusive and notorious
possession and occupation of the land in ques­tion for at least thirty (30)
years immediately preceding the filing of the present application;

“4.  That the aforementioned parcel(s) of land is a
portion of the public domain belonging to the Republic of the Philippines”
(p. 8, rec.).

The decision of the lower
court which was promulgated on August 6, 1970 was received on August 14, 1970 by the Solicitor General, who filed the instant petition for review
practically reiterating the same grounds of his opposition adding one more
ground, thus:

“1.  It is admitted that neither the applicant nor
its predecessor-in-interest had any title or grant from the Spanish sovereignty
— not even an im­perfect or incomplete title — ­the only basis of its claim
of ownership is possession (since time immemorial) which, however, as found by
the lower court, was placed at 1892.

“2. The application
for registration of title was filed only
on January 13, 1970, long after
the expiration of RA 2061 on December 31, 1968. 
Thus, the applicant can no longer avail of the benefits of Section 47, et seq. of Public Land Act, CA
141, as amended by RA 2061.

“3.  On the other hand, the nature of the land
applied for as established by the very evi­dence of the applicant, is that it
is “montañoso” and hence, must be presumed to be part of the public domain.

“4.  Consequently, the decision subject of this appeal
which applied an expired law, was rendered by the Court with­out jurisdiction
and as such, null and void” (p. 4,
rec.).

It should be stressed
that the application was filed on January 13, 1970 and the decision of the
trial court was rendered on August 6, 1970 — both before the adoption of the
new Constitution on January 17, 1973.

The majority opinion is
predicated solely on the fact that under Section 48(b) of CA No. 141, as
amended, only a Filipino citizen, not a juridical person, can file an application
for a judicial confirmation of an imperfect or incomplete title over alienable public land, relying on Our ruling in
the case of Manila Electric Co. vs. Judge Floreliana Castro-Bartolome, etc., et
al., promulgated on June 29, 1982 (G.R. No. L-49623).

The pertinent provisions
of Article XIII of the 1935 Constitution read thus:

“Sec. 1.  All
agricultural x x x lands of the public domain x x x belong to the State, and their
disposition, exploitation, develop­ment or utilization shall be limited to citizens of the Philip­pines, or to corporations or asso­ciations
at least 60% of the capital stock of which is owned by such citizens, subject
to any existing right, grant, lease or concession at the time of the
inauguration of the government established under this Constitution.  xx xx (Underlining supplied.)

“Sec. 2.  No private
corporation or association may acquire, lease or hold public agricultural lands
in excess of one thousand twenty-four hectares, nor may any individual
acquire such lands by purchase in excess of one hundred forty-four hectares, or
by lease, in excess of one thousand twenty-four hectares, or by homestead in
excess of twenty-four hectares.  Lands adapted to grazing, not exceeding two
thousand hectares may be leased to an individual, private corporation or
associa­tion” (underscoring supplied).

It should be noted from
the aforequoted provision of Section 1 of Article XIII of the 1935
Constitution that the disposition, exploitation, development or utilization of
agricultural lands of public domain, was limited to Filipino citizens or to
corporations or associations at least 60% of the capital stock of which is
owned by Filipino citizens.

It should likewise be
emphasized that by virtue of the clause “subject to any existing right,
grant, lease or concession at the time of the inauguration of the government
(Commonwealth) x x x,” a mining claim of an American corporation already
perfected prior to the inauguration of the Commonwealth, was protected against
such nationalization provision in the case of Gold Creek Mining Co. vs.
Rodriguez (66 Phil. 259), even if such perfected mining claim was not yet
covered by a torrens title.

It should also be
underscored that the aforequoted Section 2 of Article XIII allows a qualified private cor­poration or association
to acquire or hold public agricultural lands of not more than 1,024 hectares in
area.

It is therefore patent
that the provision of Section 48(b) of C.A. 141, as amended, limiting the
acquisition of public agricultural lands only to Filipino citizens was
unconstitutional before the effectivity of the 1973 Constitution; because as
aforestated the 1935 Constitution does not prohibit qualified corporations or
associations from acquiring agricultural lands of the public domain as long as
the area does not exceed 1,024 hectares. 
The area involved in the instant case is only 8,840 sq. m. — less than
a hectare.  The 1935 Constitu­tion did
not authorize Congress to totally and completely disqualify private
corporations to acquire public lands.

The right to apply for a judicial confirmation of an incomplete
or imperfect title was already vested prior to the 1973 Constitution as the
applicant acquired the same on December 20, 1969.  Furthermore, the applicant corporation
succeeded to the same vested right of its predecessors Amelia del Rosario and Fidel del Rosario who
inherited such vested right from their late predecessor, Macario, who owned and
possessed the same land since 1892 until he
died during the Japanese occupation.

This right long vested in
the applicant and its predecessors-in-interest prior to the 1973 Constitution,
cannot be impaired by Section 11 of Article XIV of the 1973
Constitution, which totally and absolutely bans private corporations or associa­tions
from acquiring alienable lands of the public domain, except by lease not
exceeding 1,000 hectares in area.

As heretofore stated, the
1935 Constitution permits such acquisition by private organizations or
associations of alienable public lands not exceeding 1,024 hectares in area.

The general rule is that constitutional provi­sions
should be given prospective, if not retroactive, effect unless retroactivity is
expressly provided or necessarily implied (See Magtoto vs. Hon. Manguera, et
al., L-37201-02; Simeon, et al. vs. Hon. Villaluz, etc., et al., L-37424;
People vs. Hon. Isnani, etc., et al., L-38929, March 3, 1975, 63 SCRA 4; 16 Am.
Jur., 2nd Ed., pp. 283-85; Black’s Constitutional Law, 2nd Ed., p. 69).

There is nothing in the
1973 Constitution expressly giving retroactive effect to Section 11 of Article
XIV thereof.  Neither such retroactivity
is necessarily implied by the said Section 11 of Article XIV or from any other
provisions of the 1973 Constitution.  Nor
is there any intimation in the journals of the proceedings of the Constitutional
Convention of 1971-72 indicating such retroactive effect or any intention to
deprive qualified persons, natural and juridical, of any right already vested
under the 1935 Constitution and long before January 17, 1973.

The recent case of
Meralco vs. Judge Floreliana Castro-Bartolome, etc., et al., decided on June
29, 1982 is not decisive of the case at bar; because in said case, the land was possessed by one Olimpia Ramos before the Pacific War which
broke out in 1941 (with­out specifying the exact date when the possession of
Ramos began).  On July 3, 1947, Ramos
sold the land to the spouses Rafael Piguing and Minerva Inocencio, who in
turn sold the same lot on August 13, 1976 to Meralco, which filed its
application for registration on December 1, 1976.  It should be noted that on August 26, 1976, the sale of the Piguing spouses to Meralco and the
application of Meralco on December
1, 1976 was effected over three years
after the effectivity of the new Constitution which absolutely prohibits private corporations or associations from holding or acquiring
alienable land on the public domain except by lease (Sec. 11, Art. XIV, 1973
Constitu­tion).

In Republic vs. Honorable Arsenio M. Gonong, etc. and Iglesia ni
Kristo, decided on November 25, 1982, the Iglesia ni Kristo acquired on July
20, 1953 the land of about 922 square meters in Barrio Pinacag, Espiritu,
Ilocos Norte from Gregorio Garnet who allegedly possessed the same for more than
thirty (30) years.  Since 1954, the Iglesia ni Kristo declared the same
for taxation purposes, paid the corresponding taxes and built a chapel
thereon.  On March 17, 1980, the Iglesia
applied for the confirmation of its title over the said parcel of land under
Section 48[b] of the Public Land Law.

In Republic vs. Judge Villanueva, etc., et al. and Iglesia ni
Kristo, etc. (G.R. No. 55289, June 29, 1982), the combined area of the lots
involved is 313 square meters which lots were acquired on January 9, 1953 by
the Iglesia from Andres Perez in exchange for a lot with an area of 247 square
meters owned by the said church.  Perez
have possessed the lot since 1933.  After
its acquisition of the said two lots, the Iglesia constructed a chapel thereon
and declared the same for realty tax purposes. 
On Septem­ber 13, 1977, the Iglesia filed an application for
registration of the two lots under Section 48[b] of the Public Land Law.

It seems there is a need of re-examining the doctrine in the aforesaid two cases, considering that the acquisition by the Iglesia was also long
before the 1973 Constitution and therefore was still governed by the 1935 Constitution which allowed such acquisition by a qualified
juridical entity of an area not exceeding 1,024 hectares (Sec. 2, Art. XIII,
1935 Constitution).

It should be stressed
that in
the aforesaid two cases of
Iglesia ni Kristo, the constitutional question was not raised and therefore was
never discussed.  It was assumed all along that the
prohibition under Section 48 of
the Public Land Act is valid because it was not challenged as unconstitutional under Section
2 of Article XIII of the 1935 Constitution.

CONCURRING OPINION

MELENCIO-HERRERA, J.:

I concur in the judgment. 
In my opinion, Section 48(b) of the Public Land Act (CA 141), which was
enacted on November 7, 1936, does not contravene the 1935 Constitution.

Corporations are artificial beings created by the
legislative.  “The creation of
corporations is exclusively a legislative function” (18 Am. Jur. 2nd, p.
574).  As products of statutory action,
the legisla­tive can define the powers of corporations.  Theoretical­ly, the power to own lands can be
denied by the legislative to corporations.

“SEC. 11 – Power to hold real or personal property.  – Some power to hold property is an incident
of all corporations for business or profit. 
As to them it exists, expressed or implied, as the necessary means to an
end.  It does not follow that such a
power exists in a public corporation or in a private corporation not for
profit, though it may be implied in them as a means to the ends for which they exist.  Whether it be one or another kind of property
or money which is within this power, is not material to the proposition that
some such power is generally incident to all private business corporations.  The existence of a power is characteristic,
but the extent of it is but limitary. 
Blackstone stated that
the power to purchase and hold lands is an inseparable incident of corporate
existence, but it is deceptive to take his statement without its context.  He states, that this power is “consequential” to the power
“to grant or receive” by its corporate name, and to “do all
other acts as natural persons may”. 
His statement may have been broadly true of all corpo­rations then
existing in England of which he knew.  It
cannot be true now of all corporations,
for some are debarred by law (charter) from holding lands.”
(1 Fletcher, 1974, Rev. Vol., Sec. 11).

The provision in the
1935 Constitution that lands of the public domain cannot be disposed of to
corpora­tions unless 60% AT LEAST of their capital is owned by Filipino citizens is a limitation on the power of the legislative to authorize corporations to
acquire lands of the public
domain.  In effect, what the
Constitution has said is that (a) since the legislative may or may not grant
power to corporations to acquire lands of the public domain; (b) should the
legislative grant power to corporations to acquire lands of the public domain, the authorized
corporations must be at least 60% owned by Filipino
citizens.  Stated differently, the
legislative may not grant corporations the power to own lands of the public domain; but if
corporation are to be granted the power
to acquire lands of the public domain, the legislative may require such
corporations to be 70% (or more than 60% at least) owned by Filipino
citizens.  What Section 48(b) of the
Public Land Act has done is not to grant corporations the power to acquire
lands of the public domain; and that negative, certainly, is not violative of
the constitutional limitation.

DISSENTING OPINION

TEEHANKEE, J.:

In line with my
consolidated dissenting opinion in the Iglesia ni Kristo and Meralco
cases (G. R. No. 55289 and G. R. No. L-49623,
both promulgated on June 29, 1982), which is hereby reproduced by reference for
brevity’s sake, I con­cur with the dissenting opinion of Justice Makasiar.  I join his call therein for reexamining the
ruling in the aforesaid cases, considering that the acquisition of the small
parcels of land therein for well-nigh public purposes was long before the
prohibition of the 1973 Constitution and therefore was still governed by the
1935 Constitution which allowed acquisition by corporations of public lands up to 1, 024 hectares.