ENRIQUE ANTONIO, GREGORIO MARQUEZ, FELIPE BAGAY, ROSITA SANDIL AND ELENA VDA. DE BAGAY, PETITIONERS, VS. HON. CONRADO F. ESTRELLA, OFFICE OF THE PRESIDENT, BENEDICTO ZAFRA, RAFA…

This is a petition for
review on certiorari of the decision of the Office of the President
dated May 21, 1985
in O. P. Case No. 2762, entitled IN RE: 
Petition for Exemption of Certain Landholdings situated in Balagtas, Bulacan, from OLT
Coverage and Cancellation of OLTS covering the same.  BENEDICTO ZAFRA, ET AL., Petitioners-Appellees, affirming in toto
the October 5, 1983 Order of the Minister of Agrarian Reform* recalling
the Certificates of Land Transfer issued to the herein petitioners.

Upon the promulgation of
Presidential Decree No. 27 on October 21, 1972, ordering “the emancipation
of the tenants from the bondage of the land they till”, herein petitioners
took the necessary steps for the eventual transfer to them of the ownership of
the land they were then, and are still cultivating.  On June
19, 1981, the corresponding Certificates of Land Transfer were
issued to them by the Ministry of Agrarian Reform, covering the landholdings in
question.

On August 10, 1982,
herein private respondents filed with the Ministry of Agrarian Reform a
petition, which was amended on September 30, 1982, praying that the parcels of
land situated in Barangays Santol,
Pulong Gubat and Dalig, Balagtas, Bulacan, sold to them in separate deeds of sale executed
on July 13, 1972, by Clara Zafra and Teodora Zafra, both deceased, be
exempted from the coverage of Operation Land Transfer pursuant to PD 27 and the
Certificates of Land Transfer issued to the tenants thereof covering the same
be recalled and cancelled on the ground that the areas sold to each of them is
less than (7) hectares and that the tenants knew of the execution of the said
deeds and have been giving the corresponding rentals to them as new
owners.  The modified petitions show that
the landholdings formerly owned by Clara Zafra and Teodora Zafra contain an
aggregate area of 52.7 hectares and that portions thereof were sold by them to
the petitioners (herein private respondents) on July 13, 1972 as follows:

The herein public respondent, the Minister of Agrarian Reform,
after investigation and hearings, in an Order dated October 5, 1983 (Record, pp. 31-35), ruled in favor of
the herein private respondents.  The decretal portion of the said order, reads:

“WHEREFORE, premises considered, the petition of Benedicto Zafra, et al., for the
exemption of their landholdings situated in Balagtas,
Bulacan, from the coverage of Operation Land Transfer
is hereby granted.  Accordingly, the
Certificates of Land Transfer covering said lands issued to the tenants thereof
are hereby recalled and cancelled; however, said tenants shall remain in the
peaceful possession and cultivation of their respective farmholdings
as agricultural lessees thereof.”

To the said Order of
October 5, 1983, herein petitioners filed a Motion for Reconsideration, arguing
that (a) the provisions of LOI 474 issued on October 21, 1976 apply to the
landholding in question; and (b) the transfer of the subject landholdings,
having been executed prior to October 21, 1972 but not registered with the
Register of Deeds concerned before said date in accordance with the Land Registration
Act (Act No. 496) shall not be considered a valid transfer insofar as the
tenants-farmers are concerned and therefore the land should be placed
under Operation Land Transfer.

In an Order dated May 28,
1984 (Ibid., pp. 64-66), respondent Minister of Agrarian Reform denied
petitioners’ Motion for Reconsideration on the grounds that (1) petitioners
failed to submit any evidence that the private respondents have other
agricultural lands; and (2) the authenticity and due execution of the deeds of
sale on July 13, 1972 have been certified to by the Acting Clerk of Court,
Regional Trial Court of Manila in his Certification dated April 22, 1983, and this being so, there is no fraudulent
transfer, much less marked fraudulent transfer.

Petitioners filed an Appeal with the Office of the President,
docketed therein as O. P. Case No. 2762. 
Petitioners premised their appeal on the grounds that (1) the act of
registration is the operative act that conveys and affects the land; (2) under LOI No. 474, all
tenanted rice/corn lands are subject
to operation land transfer pursuant to PD 27; and (3) payments have already
been made to the Land Bank of the Philippines covering their respective
landholdings.

The Office of the President, in a Decision dated May 21, 1985 (Ibid., pp. 37-40), affirmed in toto
the appealed decision.  It is its
findings and conclusion that (1) herein petitioners were notified of the sale
of the questioned parcels of land to
the herein private respondents (see Joint affidavit dated July 12,
1972 – Exh. A-6 for the appellees), and
this fact was never controverted at any stage by petitioners.  Hence, they
are bound even if the registration of said transfers were made only after the
promulgation of PD 27; (2) herein private respondents’ landholdings are not
covered by LOI No. 474 since the
area of each landholding does not exceed seven hectares; and (3) the payments
made by herein petitioners represent “advance deposit” or
“farmers deposit” and not monthly amortizations of a supposed sale
of landholdings to them.

Petitioners filed a
Motion for Reconsideration but the Office of the President, in a
Resolution dated November 22, 1985 (Ibid., p. 41), denied the same on the
ground that the same is a mere rehash of the issues raised in their appeal
memorandum of September 4, 1984.  Hence, the instant
petition (Ibid., pp. 2-16).

The Second Division of this Court, in a Resolution dated January 13, 1986 (Ibid., p. 42),
dismissed the petition for lack
of merit.

On February
27, 1986, petitioner
filed a Motion for Reconsideration (Ibid., pp. 49-52).

In a Resolution dated July
7, 1986, the Second Division of this Court resolved to require the
respondents to comment (Ibid., p. 55). 
In compliance therewith, private respondents filed their Comments and/or
Rejoinder to Petitioners’ Motion for Reconsideration (Ibid., pp. 60-63) on August 4, 1986, while public respondents
filed their Comment (Ibid., pp. 83-98) on December 20, 1986.

The Second Division of
this Court, in a Resolution dated February 4, 1987, resolved to require the petitioners to file
a reply (Ibid., p. 102).  In compliance
therewith, petitioners filed their Reply to Comment of the Office of the
Solicitor General (Ibid., pp. 103-107) on March 12, 1987.

In a Resolution dated April
27, 1987, the Second
Division of this Court resolved to give due course to the petition, and to
require the parties to submit their respective memoranda within 20 days from notice (Ibid., p. 126).

On May 19,
1987, public
respondents filed a Manifestation and Motion (Ibid., p. 129), praying that
their Comment of December
18, 1986 be
considered their memorandum.

On June 25,
1987, petitioners
filed their Memorandum (Ibid., pp. 125-144).

The sole issue raised by
petitioners is –

WHETHER OR NOT CERTIFICATE OF LAND TRANSFER ALREADY ISSUED CAN BE
CANCELLED BY THE MINISTRY OF AGRARIAN REFORM.

The answer is in the
affirmative.

As capsuled
by the Solicitor General, petitioners’ main grounds of protest against the
recall of the subject certificates of land transfer by respondent MAR
Minister covering the landholdings in question, are as follows:

“(1)    The deeds of sale were fraudulently executed
to evade the effects of the Operation land Transfer pursuant to PD 27, which
are not also binding upon them since the effectivity
of PD 27 on October 21, 1972;

“(2)   Under LOI 474, all tenanted rice/corn
lands with an area of seven hectares or less are subject to Operation Land
Transfer pursuant to PD 27, on the assumption that the owners of the
landholdings in question also own other agricultural or urban lands from which
they derive sufficient income to support them and their families; and

“(3)    Petitioners had already paid their monthly
amortizations to the Land Bank of the Philippines
on the subject landholdings supposedly sold to them pursuant to the MAR’s Operation Land Transfer as mandated by PD 27.”

I.

Public respondents MAR Minister and the Office of the President,
both found in the evidence on record and the applicable laws, that the deeds of
sale in question are valid and legal, not tainted with fraud, and the tenants
have actual knowledge thereof.

More importantly,
Agrarian Reform Team Leader, Atty. Amanda V. Cabigao
who investigated the petition of herein private respondents for cancellation of
the subject certificates of land transfer, found from the evidence presented
that while the properties left by Clara and Teodora Zafra (the previous registered owners) who both died after
the promulgation of PD No. 27, are covered by Operation Land Transfer, the same
is not true of the portions of said land, transferred to other persons before
the promulgation of said decree on October 21, 1972 whose documents of sale are
in accordance with the formalities of law and the evidence of ownership
presented.  Specifically, the disputed
deeds of sale were executed on July 13, 1972, as established by the
Certification of the Acting Clerk of Court of the Regional Trial Court
of Manila, and cannot therefore be considered fraudulent transfers to
circumvent the provisions of PD No. 27 which was still non-existent at the
time.  Thus, it has been held that a deed
of sale is valid where there is no indication that it is simulated.  The disputable presumption
that the private transaction has been fair and regular has not been rebutted.  (Par. p. Sec. 5, Rule 131,
Rules of Court; San Luis vs. Negrete, 98 SCRA 95
[1980]).  To contradict the facts
contained in a notarial document and the presumption
of regularity in its favor, there must be evidence that is clear, convincing
and more than merely preponderant.  (Yturralde vs. Azurin,
28 SCRA pp. 407-408 [1969]).

Petitioners point out that the deeds of sale were registered only
on December 7, 1972 in the
Registry of Deeds of Bulacan, that is after the date of promulgation of said decree.

It is however elementary that “while under the Torrens
System registration is the operative act that binds the land, and in the
absence of record there is only a contract that binds the parties thereto,
without affecting the rights of strangers to such contract, actual knowledge
thereof by third persons is equivalent to registration.  (Southwestern University v.
Laurente, 25 SCRA 57 [1968]; Ramos & Ayco vs. Dueno & Otceda, 50 Phil. 786 [1927]; Gustilo
vs. Maravilla, 48 Phil. 422, 448 [1925]).

In the case at bar the records show that petitioners were
notified by the Zafra sisters of the sale of the
parcels of land to the private
respondents as evidenced by the Joint Affidavit dated July 12, 1972 (Exhibit “A-6” for appellees) and that such fact was never controverted
at any stage of the proceedings by the petitioners.

II

Petitioners insist before respondents MAR and the Office of the
President, that private respondents own other lands planted to rice and corn in
order obviously to bring this case within the coverage of the Operation Land
Transfer pursuant to PD 27.  The former however failed to adduce evidence
to support their allegation. 
Accordingly, he who alleges a fact has the burden of proving it
and a mere allegation is not evidence.  (Top Weld Manufacturing Inc. vs. ECED, S.A., 138 SCRA 118 [1985]
citing Legasca vs. De Vera, 69 Phil. 376).

On the other hand, the evidence as found by respondent MAR
clearly shows that subject landholdings were part of a big land area and that
portions thereof were sold to private respondents, the total of which is less
than seven (7) hectares to each of them. 
Furthermore, it was also found by respondent MAR and affirmed on appeal
by the Office of the President that none of private respondents “own other
agricultural lands of more than seven (7) hectares in aggregate area or lands
used for residential, commercial, industrial, or other urban purposes from
which they derive sufficient income to support themselves and their
families.” (Comment, Solicitor General, Rollo, pp. 91-93).

It is evident that there
is no dispute as to the requisites of a valid contract of sale.  Petitioners even agree with respondents that
the contract of sale (to them) in the case at bar is understandably peculiar in
the sense that the parties were practically forced to agree
voluntarily”.  A contract of sale
under PD 27, as petitioners assert, is one created by operation of law.  (Rollo,
p. 8).  But petitioners missed the
point all together that PD 27, the agreed basis of Operation Land Transfer is
not applicable, precisely because none of the areas taken exceeds seven (7)
hectares.

Hence as correctly observed by the Solicitor General, there could
hardly be any “meeting of the minds” between herein petitioners and
private respondents, as sellers and buyers, respectively, of the
landholdings.  There was no assent and
concurrence of the parties to the forced sale of said landholdings.  Such forced sales of the subject
landholdings, upon a mistaken application of the Operation Land Transfer by way
of implementing PD 27, was obviously made under circumstances that certainly
negated consent on the part of herein private respondents as sellers
thereof.  (Rollo, p. 94).

Without consent nor the law to justify the compulsion of such
transfer, no valid and legal contract of sale, involving the subject
landholdings, is possible.

III.

Neither can the continuous payments of rentals
to the previous registered owners and to herein private respondents as
the new owners thereof by the tenants to the Land Bank of the Philippines be considered as the agreed cause or
consideration of the forced sale of subject landholdings.  As established, such payments were considered
by the MAR as “amortizations/part payments of the said land if the tenants
will prevail in the case or rentals if otherwise” (Annex “G”
Petition, Rollo, p. 36).  Moreover, the receipts issued by the Land
Bank of the Philippines
show that the payments made by appellants (petitioners herein) represent
“advance deposit” of “farmers deposit” and not monthly
amortizations.  Such deposits may be
withdrawn from the Land Bank by the petitioners as their landholdings do not
fall within the purview of the operation land transfer, as stated by the
Minister of Agrarian Reform and sustained by the Office of the President.  (Annex “H-3”
Petition, Rollo, p. 39).

Finally, two agencies of
the government, MAR and Office of the President,
examined the evidence and came up with the same findings.  It is therefore without question that such
findings supported as they are by substantial evidence, should be
respected.  In line with this view, the
Court has ruled:

“x x
x in reviewing administrative decisions, the
reviewing court cannot reexamine the sufficiency of the evidence as if
originally instituted therein, and receive additional evidence that was not
submitted to the administrative agency concerned.  The findings of fact must be respected, so
long as they are supported by substantial
evidence, even if not overwhelming or preponderant.” (Police
Commission vs. Lood, 127 SCRA 757, 763 [1984].

PREMISES CONSIDERED, the instant petition is DISMISSED and the decision
of the Office of the President is AFFIRMED.

SO ORDERED.

Teehankee, C.J., Narvasa,
Cruz, and Gancayco,
JJ., concur.

* Decided by
Presidential Assistant for Legal Affairs, Manuel M. Lazaro.