RENATO TIPON, PETITIONER, VS. HON. INTERMEDIATE APPELLATE COURT, REGIONAL TRIAL COURT OF LAGUNA (FORMERLY COURT OF FIRST INSTANCE, EIGHT JUDICIAL DISTRICT, BR. I, BINAN, LAGUNA)…

This case involves a parcel of land situated in Barrio San
Vicente, San Pedro, Laguna, containing an area of 3.46 hectares, more or
less.  The lot was part of the estate, known as the Laguna
Settlement Project, belonging to the Republic of the
Philippines,
originally purchased and administered by the National Resettlement and
Rehabilitation Administration (NARRA) for disposal to landless tenants and farm
workers pursuant to Republic Act No. 1160.  With the abolition of
NARRA, the administration of the Laguna Settlement Project was vested in the
Land Authority created under Republic Act No. 3844, and subsequently,
transferred to the Department of Agrarian Reform.

Petitioner Renato Tipon acquired the lot in question (Lot No. 386 of the
Laguna Settlement Project) from the government by virtue of a Deed of Sale
executed in his favor by the Department of Agrarian Reform on November 23, 1976, for the price of
P1,251.20.  Among the conditions stated in the Deed of Sale were
the following:

“1.  x x x

2. That from the date of the pertinent Order of Award and within TEN
(10) years from the date of issuance by the proper Register of Deeds of the
certificate of title, the land subject hereof shall not, except by hereditary
succession, be subdivided, sold or in any manner transferred or encumbered
except in favor of any of the VENDEE’s relative
within the third civil degree by consanguinity or affinity who fulfill the four
(4) requirements in section 6, Land Authority Administrative Order No. 4, series
of 1967, or in favor of the Government and its financial or banking institution
or rural banks, and only upon prior written consent of the Secretary of the
Department of Agrarian Reform; and any said transfer, encumbrance or alienation
made in violation hereof shall be null and void; provided, that in case of
foreclosure of mortgage on the lot, only qualified landless bona-fide
farmers in the municipality where the land subject of foreclosure lies, may
participate in the bidding, and in their absence, the mortgagee shall be allowed
to bid but may not thereafter sell the land without prior written permission
from the Secretary of the department of AGRARIAN REFORM, further, that any sale,
transfer or alienation made by the herein VENDEE as authorized in this paragraph
shall be subject to the right of repurchase by him or by his legal heirs within
a period of five (5) years from the date of such sale, transfer or
alienation.

3. That the violation of the next preceding paragraph shall be sufficient
ground for the forfeiture of all payments made on account of the purchase price
hereof without prejudice to the right of the VENDOR to demand full settlement by
the VENDEE of the loan or loans, if any, extended to him by the VENDOR and/or
defunct NARRA; and the prosecution by the VENDOR of the proper certification in
court for the cancellation of this DEED OF SALE or the certificate of title that
may hereafter be issued in favor of the VENDEE and/or his successor-in-interest
and the reversion of the land and improvements thereon to the
government.”

On the day the Deed of Sale was executed in his favor, Tipon filed a request with the Department of Agrarian Reform
for permission to transfer his rights and interest over the lot in question in
favor of Atty. Umiral P. Matic (respondent herein).  This request was
granted by the Regional Director of Region IV of the Department of Agrarian
Reform on December 9, 1976
“subject to the condition that the Deed of Transfer is submitted to
this department for verification and final approval.”

On December 10,
1976, Tipon submitted the Deed of Absolute
Sale in favor of Matic for approval and, on the same
day, it was approved by the Regional Director of Region IV of the Department of
Agrarian Reform.  Thereafter, Matic
caused the titling of the property in the name of Tipon to whom was issued Transfer Certificate of Title No.
50617, and later, had the same transferred to his name under Transfer
Certificate of Title No. 53850 dated July 12, 1977, of the Registry of Deeds for the
Province of
Laguna.

However, in a letter dated March 8, 1977 addressed to the Regional
Director of Region IV, Department of Agrarian Reform, Tipon sought the cancellation and nullification of the
transfer he had made of his rights over the lot in question to respondent Matic, and requested at the same time that he be granted
permission to transfer his rights therein to one Calixto Cataquiz. 
This letter was followed by the actual filing of a formal complaint by
Tipon against Matic with the
Department of Agrarian Reform, seeking the annulment of the Deed of Sale in
favor of Matic.  This complaint was
subsequently dismissed on the motion of Tipon, who, at
the same time, executed a “release, waiver and quit claim” of any and all
rights, title and interest he has over the lot in question in favor of Matic.

Later, however, in a letter dated June 15, 1977, Tipon, through counsel, made a demand on Matic to either pay him the sum of P86,612.50 representing
50% of the sum of P173,225.00 which he alleged to be the true consideration of
the sale of the lot in question per their verbal agreement, or to reconvey to him the said lot for the amount of P20,000.00,
the consideration appearing in the Deed of Absolute Sale, dated December 10,
1976.

As respondent Matic chose to ignore the
demand, the petitioner filed a complaint with the Court of First Instance of
Laguna (Civil Case No. B-1317) seeking to compel the defendant Matic to allow him to redeem or repurchase the parcel of
land in question, invoking the provisions of Section 8 of Administrative
Order No. 4, Series of 1967, which gives the vendor or transferror the right to do so within a period of five (5)
years from date of sale, transfer or alienation, a right which was embodied in
the Deed of Sale executed by the Department of Agrarian Reform in his favor
annotated in the corresponding certificate of title.

After trial, the lower court dismissed the complaint and ordered
the plaintiff Tipon to reimburse the defendant Matic the sum of P7,561.55 by way of attorney’s fees
and to pay the costs of the proceedings.

Tipon appealed the said decision to the
then Court of Appeals, but the latter, in a decision dated May 8, 1985, affirmed the appealed decision
en toto. 
Hence, this petition for review on certiorari.

The petition should be given due course.  However, in
disposing of this case, the Court is not limited to the narrow issues raised in
the petition.

It is abundantly clear from the evidence presented to the
Court a quo that the parties in this case have
flouted the law.  The land in question was part of a landed estate
acquired by the government for distribution to landless tenants and
farmers.  The petitioner was awarded the lot in question,
being purportedly deserving and qualified to acquire the same.  In
awarding lands pursuant to laws intended to alleviate the plight of the
landless, the state normally imposes certain conditions and restrictions
designed to prevent practices that would defeat the beneficent purpose of the
law.  Thus, in this case, the deed of sale in favor of the
petitioner (vendee) embodied a clause explicitly prohibiting him from selling,
transferring and encumberring the property granted to
him within ten years from the issuance of the certificate of title, “except in
favor of any of the vendee’s relatives within the third civil degree by
consanguinity or affinity who fulfill the four (4) requirements in Section 6,
Land Authority Administrative Order No. 4, Series of 1967, or in favor of the
government and its financial or banking institution or rural banks . . .”
Another clause (paragraph 3) of the deed of sale provides that any violation of
the conditions shall be a ground for the cancellation of the deed of sale or
certificate of title that may be issued in favor of the vendee and his
successor-in-interest, and the reversion of the land and improvements thereon to
the government.

On the very same day (November 23, 1976) that the petitioner
acquired the property from the government, the petitioner turned around and
asked permission from the Department of Agrarian Reform to sell the same
to respondent Matic in violation of the conditions to
which the grant was subject.  Inspite of
the clause restricting the transferability of the land, the request was approved
by the Regional Director of Region IV of the Department of Agrarian Reform on
December 9, 1976, and on the
next day, the petitioner executed the corresponding deed of sale in favor of the
respondent for the stated consideration of P20,000.00.  The deed of
sale was approved by the Regional Director on the same
day.

It is difficult to understand why the courts which have
dealt with this case failed to note how the parties so flagrantly
violated and disregarded the conditions imposed on the grant of the land to
petitioner, defeating with impunity the very objective sought to be accomplished
by the government in its program of giving land to the landless. 
There is hardly any doubt from the evidence on record that the petitioner
had no intention at all of keeping for himself and utilizing the land which he
acquired from the government, for even while the ink on the deed of sale in his
favor was still wet, so to speak, he already took steps to transfer the land to
the respondent.  His indecent haste in disposing of the land,
followed by his despicable attempts to make an exorbitant profit from the
transaction only shows that he was unduly taking advantage of the land
distribution program of the government and was interested only in making a
killing for himself rather than in gratefully accepting the land from the
government to improve his lot in life and provide for himself and his
family a brighter future.  The Court is not unaware of the practice
of some intended beneficiaries of the land distribution programs of the
government who are more interested in reselling the land and making a quick
profit from it.  We cannot close our eyes to this deplorable
practice.  We should not allow either party in the present case to
reap any benefit from the illegal transaction and make a mockery of the
government’s laudable program of providing land to the landless and shelter to
the homeless citizens of our country.

WHEREFORE, judgment is rendered denying the reliefs prayed for by the petitioner and dismissing the
petition; annulling the transfer of the land in question (Lot No. 386 of
GSS-877) to petitioner and its subsequent transfer to respondent Umiral P. Matic; ordering the
cancellation of Transfer Certificate of Title No. 53850 covering said land,
issued by the Register of Deeds for the Province of Laguna, in the name of
respondent Umiral P. Matic;
and directing the said Register of Deeds to issue in lieu thereof a Certificate
of Title in the name of the Republic of the Philippines.

SO
ORDERED.

Narvasa, Melencio-Herrera,
Feliciano, Gancayco,
and Sarmiento, JJ., concur.

Cruz J., took no part, having been a
member of the law offices representing petitioner, until his appointment to the
Supreme Court