DEPARTMENT OF AGRARIAN REFORM, REPRESENTED BY OIC -SECRETARY NASSER C. PANGANDAMAN, PETITIONER, VS. VICENTE K. UY, RESPONDENT.

Department of Agrarian Reform versus Uy

The Case

This is a petition for review on certiorari brought by the Department of Agrarian Reform against Vicente K. Uy and his co-owners of a large landholding in San Narciso, Quezon. The dispute is whether the entire landholding, admittedly devoted to cattle, carabao, and horse raising, must be excluded from the coverage of the Comprehensive Agrarian Reform Program, or only a portion of it. The case matters because it construes the phrase "regardless of age" in the Department's own administrative order implementing the landmark ruling in Luz Farms versus the Secretary of the Department of Agrarian Reform, and because it fixes the reckoning point for counting livestock when a landowner claims exemption from agrarian reform coverage.

Procedural History

The application for exclusion was filed with the Provincial Agrarian Reform Officer. The Regional Director affirmed the finding that only 219.50 hectares should be excluded. The landowners appealed to the Secretary of Agrarian Reform, who issued an Order partially granting the application and placing the remainder of 130.4996 hectares under agrarian reform coverage. The landowners appealed to the Office of the President, which dismissed the appeal for lack of merit and later denied their motion for reconsideration. A second motion for reconsideration was denied as a prohibited pleading. The landowners then filed a petition for review before the Court of Appeals, which initially affirmed the Office of the President. On motion for reconsideration, however, the Court of Appeals rendered an Amended Decision reversing itself and declaring the entire landholding exempt from coverage. The Department's motion for reconsideration was denied, so the Department came to the Supreme Court by petition for review on certiorari under Rule 45.

Facts

Vicente K. Uy and several co-owners hold a parcel of land of 349.9996 hectares in Barangay Camaflora, San Narciso, Quezon, covered by a transfer certificate of title. In 1993, some 44 farmers occupying portions of the property petitioned to be declared owners-beneficiaries, and in December 1994 the Department issued a Notice of Coverage under the Comprehensive Agrarian Reform Program.

In May 1995, Uy, on behalf of the co-owners, applied for exclusion, claiming the property had been exclusively used for livestock raising for several years prior to June 15, 1988, the date the agrarian reform law took effect. They declared 400 heads of cattle, 5 horses, and 25 carabaos on the land. A Provincial Task Force conducted an ocular inspection and an actual headcount, finding 401 cattle, 20 horses, and 8 carabaos, with about 346 hectares used for grazing and 3 hectares for infrastructure. The Task Force observed, however, that the necessary infrastructure and facilities were not present, and that per information from the farmers, majority of the cattle were brought in only in the early part of that year. It recommended that areas actually cultivated and occupied by tenants be covered, and only unaffected areas excluded.

The Provincial Agrarian Reform Officer recommended exclusion of 219.50 hectares, relying on Certificates of Ownership of Large Cattle issued by the Municipal Treasurer, and noting that only 134 cattle were seven years old and above. The Secretary of Agrarian Reform adopted this view, reasoning that only livestock at least seven years old could be presumed present as of June 15, 1988. The Office of the President affirmed, but the Court of Appeals, on reconsideration, held that the administrative order requires counting livestock "regardless of age" at the time of inspection, and declared the entire landholding exempt.

Issues

• Whether or not the second motion for reconsideration filed by the respondent tolled the reglementary period to appeal, such that the petition for review before the Court of Appeals was filed out of time.
• Whether or not the phrase "regardless of age" in Section III-B of Department Administrative Order Number 9, Series of 1993, should be reckoned from June 15, 1988, or from the date of inspection.

Applicable Provisions

Section III-B of Department Administrative Order Number 9, Series of 1993, provides:

Private agricultural lands or portions thereof exclusively, directly and actually used for livestock, poultry and swine raising as of 15 June 1988 shall be excluded from the coverage of CARP.

This is the very provision whose meaning is in dispute, because it fixes June 15, 1988 as the reckoning date for exclusive, direct, and actual use.

The same administrative order provides on the ratios of land to livestock:

In determining the areas qualified for exclusion under this Administrative Order, the following ratios of land, livestock, poultry and swine raising shall be adopted: 1.0 Grazing 1.1 Cattle, Carabao and Horse Raising - cattle, carabao and horse (regardless of age) - the maximum ratio is one (1) head to one (1) hectare.

The phrase "regardless of age" is the textual hook on which the entire second issue turns.

Section 49 of Republic Act Number 6657 provides:

SECTION 49. Rules and Regulations. - The PARC and the DAR shall have the power to issue rules and regulations, whether substantive or procedural, to carry out the objects and purposes of this Act. Said rules shall take effect ten (10) days after publication in two (2) national newspapers of general circulation.

This confirms the Department's authority to promulgate the implementing order that the Court is called upon to construe.

Ruling

On the first issue, the Court held that the second motion for reconsideration did not toll the reglementary period to appeal. Under the Rules of Procedure of the Office of the President, only one motion for reconsideration is allowed except in exceptionally meritorious cases, and the second motion was a prohibited pleading. The period to file the petition for review had therefore already expired fifteen days after the denial of the first motion for reconsideration, and the Court of Appeals should have dismissed the petition as filed out of time.

On the second issue, the Court ruled that the phrase "regardless of age" in Section III-B of the administrative order refers to the livestock existing as of June 15, 1988, and not to whatever animals happen to be present on the date of inspection. The Court reasoned that the order itself requires that the land be exclusively, directly, and actually used for livestock raising as of June 15, 1988, and that the ratio of one head to one hectare is merely the measure for computing the area qualified for exclusion. To count animals acquired after that date would defeat the very purpose of the order, which was issued to prevent circumvention of the agrarian reform program through the fraudulent conversion of agricultural lands to livestock raising. The Court also noted that the ocular inspection showed portions planted to coconut and occupied by farmer-beneficiaries, so the landholding could not have been exclusively devoted to livestock raising as of the reckoning date.

Doctrine

First, a second motion for reconsideration is a prohibited pleading and does not toll the reglementary period to appeal, except in exceptionally meritorious cases under the Rules of Procedure of the Office of the President.

Second, for a landholding to be excluded from agrarian reform coverage on the ground of livestock raising, it must be shown that the land was exclusively, directly, and actually used for that purpose as of June 15, 1988, the effectivity of Republic Act Number 6657.

Third, the phrase "regardless of age" in the administrative order does not authorize counting livestock acquired after June 15, 1988; only animals existing as of that date may be credited in applying the one head to one hectare ratio, because the order exists precisely to prevent fraudulent conversion.

Disposition

The Court granted the petition, set aside the Amended Decision of the Court of Appeals, and reinstated the ruling limiting the exemption to 219.50 hectares, with the remainder placed under agrarian reform coverage.

Remember This

Memorize this line: the reckoning date for the livestock exemption is June 15, 1988, and "regardless of age" means the animals existing on that date, not those present at inspection. Examiners use this case to test the construction of administrative orders implementing agrarian reform and the rule that a second motion for reconsideration does not toll the appeal period.