MARIANO DAO-AYAN AND MARJUN DAO-AYAN, PETITIONERS, VS. THE DEPARTMENT OF AGRARIAN REFORM ADJUDICATION BOARD (DARAB), ARANETA LANDLESS AGRARIAN REFORM FARMERS ASSOCIATION, REP. B…

Dao-ayan versus Department of Agrarian Reform Adjudication Board

The Case

This is a petition for review on certiorari brought by Mariano Dao-ayan and his son Marjun Dao-ayan against the Department of Agrarian Reform Adjudication Board, the Araneta Landless Agrarian Reform Farmers Association, the Provincial Agrarian Reform Officer of Bukidnon, and the Register of Deeds of Bukidnon. The petitioners sought the annulment and cancellation of a Certificate of Land Ownership Award, and of the transfer certificate of title issued in the association's name, over a lot placed under the Comprehensive Agrarian Reform Program. The case matters because it draws the jurisdictional line between the Department of Agrarian Reform and its adjudication board, and because it fixes when the disqualification of a farmer-beneficiary becomes final and beyond challenge.

Procedural History

The petitioners filed a complaint for annulment and cancellation of the certificate of land ownership award before the Regional Agrarian Reform Adjudicator of the Department of Agrarian Reform Adjudication Board in Malaybalay City. The adjudicator dismissed the complaint in October 1998, holding that the identification of farmer-beneficiaries had already been finally determined by the Department of Agrarian Reform, and that the board had no authority to pass upon the qualification of would-be beneficiaries. The petitioners appealed to the Department of Agrarian Reform Adjudication Board, which affirmed the dismissal in November 2002. They then went up to the Court of Appeals, which affirmed in December 2005, holding that the regional director's resolution had become final and executory for failure to appeal it to the Office of the Secretary. From that decision, the petitioners filed the present petition for review on certiorari before the Supreme Court.

Facts

Lot Number 209, located at Kahaponan, Valencia City, Bukidnon, belonged to the Agricultural Research Farm Incorporated and was placed under the Comprehensive Agrarian Reform Program. Marjun Dao-ayan applied before the regional office of the Department of Agrarian Reform as a farmer-beneficiary, but his name as applicant was later delisted. The Araneta Landless Agrarian Reform Farmers Association, meanwhile, filed a petition for disqualification of Mariano as farmer-beneficiary, on the ground that he already possessed substantial real properties. Acting on that petition, the regional director disqualified Mariano, finding among other things that he was already a beneficiary under Operation Land Transfer of Presidential Decree Number 27 of at least three parcels of land totaling 2.2938 hectares.

The regional director then issued the certificate of land ownership award to the association in October 1997, and on that account a transfer certificate of title was issued in its name. The petitioners filed a motion to stay execution of the award, claiming they were never given notice of the petition for disqualification or of the decision on it. In May 1998, the Provincial Agrarian Reform Officer issued an installation order directing the association's installation on the lot and the vacation of the premises by occupants who were not beneficiaries, including the petitioners.

On June 22, 1998, the petitioners filed their complaint for annulment and cancellation of the award. The adjudicator dismissed it, reasoning that the matter of identification of farmer-beneficiaries had been finally determined by the Department of Agrarian Reform, that the proper recourse was to the Secretary as the ultimate arbiter, and that Marjun, who by his own admission was merely entrusted with the land by his father, could have no better right than his disqualified father.

Issues

• Whether or not the Regional Agrarian Reform Adjudicator has jurisdiction over the annulment of registered certificates of land ownership award.
• Whether or not the decision of the regional director disqualifying the petitioners, and the award of the certificate to the association, had already become final and executory such that it may no longer be questioned in further proceedings.

Applicable Provisions

Section 50 of Republic Act Number 6657, the Comprehensive Agrarian Reform Law of 1988, provides:

The DAR is hereby vested with primary jurisdiction to determine and adjudicate agrarian reform matters and shall have exclusive original jurisdiction over all matters involving the implementation of agrarian reform, except those falling under the exclusive jurisdiction of the Department of Agriculture and the Department of Environment and Natural Resources.

This is the source of the Department of Agrarian Reform's primary jurisdiction, which the Court uses to locate the adjudication board's authority.

Section 1, Rule II of the 1994 Rules of Procedure of the Department of Agrarian Reform Adjudication Board provides:

Those involving the issuance, correction and cancellation of Certificates of Land Ownership Award and Emancipation Patents which are registered with the Land Registration Authority.

This grants the board exclusive original jurisdiction over registered awards, which is decisive of the first issue.

Section 2 of Department of Agrarian Reform Administrative Order Number 06-00 provides:

Identification, qualification or disqualification of potential farmer-beneficiaries.

This places beneficiary disqualification within the exclusive jurisdiction of the Secretary, and it also governs the cancellation of awards not yet registered with the Register of Deeds.

Section 15, Chapter 3, Book VII of the Administrative Code of 1987 provides:

The decision of the agency shall become final and executory fifteen days after the receipt of a copy thereof by the party adversely affected unless within that period an administrative appeal or judicial review, if proper, has been perfected. One motion for reconsideration may be filed, which shall suspend the running of the said period.

This supplies the rule on finality that the Court applies to the regional director's resolution, there being no specific administrative issuance then in force.

Ruling

On the first issue, the Court held that the adjudication board correctly assumed jurisdiction. Jurisdiction over the subject matter is conferred by law, and the Court traced the dividing line through its earlier ruling in Padunan against the Department of Agrarian Reform Adjudication Board: prior to registration with the Register of Deeds, cases involving the issuance, recall, or cancellation of certificates of land ownership award or emancipation patents fall within the jurisdiction of the Department of Agrarian Reform; once registered, they fall within the jurisdiction of the adjudication board. Because the complaint sought cancellation of an award already registered, the board had jurisdiction.

On the second issue, the Court held that the regional director's resolution had indeed become final and executory, but it corrected the Court of Appeals on the source of the rule. Administrative Order Number 06-00, Series of 2000, could not apply, because every incident in the case occurred before its issuance in 2000: the petition for disqualification was filed in April 1994, the award was granted in October 1997, it was registered in October 1997, and the complaint was filed in June 1998. Resort was therefore had to the Administrative Code of 1987.

The Court then addressed notice. Beyond the bare assertions of the association and the board, there was no proof that the petitioners had been given notice of the proceedings before the regional director. The fifteen-day period was therefore counted from the registration of the award on October 28, 1997, which is constructive notice to the whole world, or from December 12, 1997, when the petitioners filed their motion to stay execution. No appeal having been taken within fifteen days from either date, the resolution had become final long before the complaint was filed in June 1998.

Doctrine

First, jurisdiction over the cancellation of certificates of land ownership award is split by registration: before registration with the Register of Deeds, the Department of Agrarian Reform has jurisdiction; after registration, the Department of Agrarian Reform Adjudication Board has exclusive original jurisdiction. Second, the identification, qualification, and disqualification of potential farmer-beneficiaries is an administrative matter lodged with the Department of Agrarian Reform, to be ventilated through the hierarchical ladder up to the Secretary, not collaterally attacked before the adjudication board. Third, under Section 15 of the Administrative Code of 1987, an agency decision becomes final and executory fifteen days after receipt of a copy by the party adversely affected, unless an administrative appeal or judicial review is perfected, and one motion for reconsideration suspends that period. Where no proof of notice exists, the period is counted from constructive notice by registration of the award, or from the date the party filed a motion to stay execution.

Disposition

The petition was denied, and the decision of the Court of Appeals affirming the dismissal of the complaint was upheld.

Remember This

Memorize the registration divide: unregistered awards belong to the Department of Agrarian Reform, registered awards belong to the adjudication board. Examiners use this case to test jurisdiction over certificate of land ownership award cancellation and the finality of a regional director's disqualification of a farmer-beneficiary.