DOCTRINES:

1. In no case shall retention by the landowner exceed five (5) hectares.

2. The right to choose the area to be retained, which shall be compact or contiguous, shall pertain to the
landowner: Provided, however, That in case the area selected for retention by the landowner is
tenanted, the tenant shall have the option to choose whether to remain therein or be a beneficiary in
the same or another agricultural land with similar or comparable features.
3. The right of retention is a constitutionally guaranteed right, which is subject to qualification by the
legislature
4. Laches is defined as the failure or neglect for an unreasonable and unexplained length of time, to do
that which by exercising due diligence could or should have been done earlier
5. Certificate of Land Ownership Award or CLOA is a document evidencing ownership of the land granted
or awarded to the beneficiary by the DAR, and contains the restrictions and conditions provided for in
the CARL and otl1er applicable law. (ON MR)
6. In case of multiple or series of transfers/sales, the first five (5) hectares sold/conveyed without DAR
clearance and the corresponding titles issued by the Register of Deeds (ROD) in the name of the
transferee shall, under the principle of estoppel, be considered valid and shall be treated as the
transferor/s' retained area but in no case shall the transferee exceed the five-hectare landholding ceiling
pursuant to Sections 6, 70 and 73(a) of R.A. No. 6657. (ON MR)

G.R. No. 176549, January 20, 2016 and G.R. No. 176549, October 10, 2018
DEPARTMENT OF AGRARIAN REFORM, QUEZON CITY & PABLO MENDOZA, Petitioner, v. ROMEO C.
CARRIEDO, Respondents.

NATURE OF THE CASE

This is a Motion for Reconsideration filed by the Department of Agrarian Reform (DAR) of the Decision dated
January 20, 2016.

FACTS

Petitioner Pablo Mendoza is the tenant of the land by virtue of a Contrato King Pamamuisan executed between
him and Roman De Jesus wherein he has been paying 25 piculs of sugar every crop year as lease rental and was
later changed to P2,000.00 per crop year, the land being no longer devoted to sugarcane.

Roman died leaving the entire 73.3157 hectares to his surviving wife Alberta Constales (Alberta), and their two
sons Mario De Jesus (Mario) and Antonio De Jesus (Antonio). On August 23, 1984, Antonio executed a Deed of
Extrajudicial Succession with Waiver of Right which made Alberta and Mario co-owners in equal proportion of
the agricultural land left by Roman.

Mario sold approximately 70.4788 hectares to respondent Romeo C. Carriedo (Carriedo). The area sold to
Carriedo included the land tenanted by Mendoza. Mendoza alleged that the sale took place without his
knowledge and consent.

On June of 1990, Carriedo sold all of these landholdings to the Peoples' Livelihood Foundation, Inc. (PLFI)
represented by its president, Bernabe Buscayno. All the lands, except that covered by TCT No. 17680, were
subjected to Voluntary Land Transfer/Direct Payment Scheme and were awarded to agrarian reform
beneficiaries in 1997.

The parties to this case were involved in three cases concerning the land:

The Ejectment Case

Carriedo filed a Complaint for Ejectment and Collection of Unpaid Rentals against Mendoza before the PARAD
which ruled that Mendoza had knowledge of the sale, hence, he could not deny the feet nor assail the validity of
the conveyance.

The DARAB affirmed the PARAD Decision and ruled that ownership of the land belongs to Carriedo. That the
deed of sale was unregistered did not affect Carriedo's title to the land. By virtue of his ownership, Carriedo was
subrogated to the rights and obligation of the former landowner, Roman.

The CA affirmed the DARAB decision in toto.

On Certiorari with the SC, the Court denied the petition for failure to comply with the requirements under Rule
45 of the Rules of Court. An Entry of judgment was issued on October 25, 2000. In effect, the Decision of the CA
was affirmed, and the following issues were settled with finality:

1) Carriedo is the absolute owner of the five (5) hectare land;

2) Mendoza had knowledge of the sale between Carriedo and Mario De Jesus, hence he is bound by the sale;
and
3) Due to his failure and refusal to pay the lease rentals, the tenancy relationship between Carriedo and
Mendoza had been terminated.

The Redemption Case

On July 21, 1997, Mendoza filed a Petition for Redemption with the PARAD which dismissed his petition on the
grounds of  this pendentia and lack of the required certification against forum-shopping. It dismissed the
petition so that the pending appeal of DARAB Case No. 163-T-90 (the ejectment case discussed above) with the
CA can run its full course, since its outcome partakes of a prejudicial question determinative of the tenability of
Mendoza's right to redeem the land under tenancy.

The DARAB reversed the PARAD and granted Mendoza redemption rights over the land for he was not notified
of the sale of the land to Carriedo and of the latter's subsequent sale of it to PLFI. The absence of the mandatory
requirement of notice did not stop the running of the 180 day-period within which Mendoza could exercise his
right of redemption. It also ruled that Carriedo is no longer the owner of the land when he filed the complaint
for ejectment.

On Petition for Review, the CA reversed the DARAB Decision.

The Coverage Case

On February 26, 2002, Mendoza, his daughter Corazon Mendoza (Corazon) and Orlando Gomez (Orlando) filed a
Petition for Coverage of the land under RA No. 6657. They claimed that they had been in physical and material
possession of the land as tenants since 1956, and made the land productive. The petition was granted by the
Regional Director (RD) in an Order dated October 2, 2002.

On October 24, 2002, Carriedo received a copy of a Notice of Coverage dated October 21, 2002 from MARO
Maximo E. Santiago informing him that the land had been placed under the coverage of the CARP.  On December
16, 2002, the RD denied Carriedo's protest in an Order dated December 5, 2002. Carriedo filed an appeal to the
DAR-CO.

In an Order dated February 22, 2005, the DAR-CO, through Secretary Rene C. Villa, affirmed the Order of the RD
granting coverage. The DAR-CO ruled that Carriedo was no longer allowed to retain the land due to his violation
of the provisions of RA No. 6657. His act of disposing his agricultural landholdings was tantamount to the
exercise of his retention right, or an act amounting to a valid waiver of such right in accordance with applicable
laws and jurisprudence. However, it did not rule whether Mendoza was qualified to be a farmer-beneficiary of
the land.

The CA reversed the DAR-CO, and declared the land as Carriedo's retained area. The CA ruled that the right of
retention is a constitutionally-guaranteed right, subject to certain qualifications specified by the legislature.  It
serves to mitigate the effects of compulsory land acquisition by balancing the rights of the landowner and the
tenant by implementing the doctrine that social justice was not meant to perpetrate an injustice against the
landowner. It held that Carriedo did not commit any of the acts which would constitute waiver of his retention
rights found under Section 6 of DAR Administrative Order No. 02, S.2003

ISSUE

WHETHER CARRIEDO HAS THE RIGHT TO RETAIN THE LAND.

RULING

Yes, Carriedo did not waive his right of retention over the land.

The 1987 Constitution expressly recognizes landowner retention rights under Article XIII, Section 4, to wit:
Section 4. The State shall, by law, undertake an agrarian reform program founded on the right of farmers and
regular farmworkers, who are landless, to own directly or collectively the lands they till or, in the case of other
farmworkers, to receive a just share of the fruits thereof.  To this end, the State shall encourage and undertake
the just distribution of all agricultural lands, subject to such priorities and reasonable retention limits as the
Congress may prescribe, taking into account ecological, developmental, or equity considerations, and subject to
the payment of just compensation. In determining retention limits, the State shall respect the right of small
landowners. The State shall further provide incentives for voluntary land-sharing.

RA No. 6657 implements this directive

The right to choose the area to be retained, which shall be compact or contiguous, shall pertain to the
landowner: Provided, however, That in case the area selected for retention by the landowner is tenanted, the
tenant shall have the option to choose whether to remain therein or be a beneficiary in the same or another
agricultural land with similar or comparable features. In case the tenant chooses to remain in the retained
area, he shall be considered a leaseholder and shall lose his right to be a beneficiary under this Act. In case the
tenant chooses to be a beneficiary in another agricultural land, he loses his right as a leaseholder to the land
retained by the landowner. The tenant must exercise this option within a period of one (1) year from the time
the landowner manifests his choice of the area for retention. In all cases, the security of tenure of the farmers or
farmworkers on the land prior to the approval of this Act shall be respected.
The right of retention is a constitutionally guaranteed right, which is subject to qualification by the legislature.
It serves to mitigate the effects of compulsory land acquisition by balancing the rights of the landowner and the
tenant and by implementing the doctrine that social justice was not meant to perpetrate an injustice against the
landowner. A retained area, as its name denotes, is land which is not supposed to anymore leave the
landowner's dominion, thus sparing the government from the inconvenience of taking land only to return it to
the landowner afterwards, which would be a pointless process. For as long as the area to be retained is compact
or contiguous and does not exceed the retention ceiling of five (5) hectares, a landowner's choice of the area to
be retained must prevail.

Section 6 of DAR AO 02-03 provides for the instances when a landowner is deemed to have waived his right of
retention.

Petitioners cannot rely on the RD's Order dated October 2, 2002 which granted Mendoza's petition for coverage
on the ground that Carriedo violated paragraph 4 Section 6 of RA No. 6657 for disposing of his agricultural land,
consequently losing his right of retention. At the time when the Order was rendered, up to the time when it was
affirmed by the DAR-CO in its Order dated February 22, 2005, the applicable law is Section 6 of DAR 02-03.
Section 6 clearly shows that the disposition of agricultural land is not an act constituting waiver of the right of
retention..

Petitioners claim that Carriedo's alleged failure to exercise his right of retention alter a long period of time
constituted a waiver of his retention rights, as envisioned in Item 6.7 of DAR AO 02-03.

We disagree. Laches is defined as the failure or neglect for an unreasonable and unexplained length of time, to
do that which by exercising due diligence could or should have been done earlier; it is negligence or omission to
assert a right within a reasonable time, warranting a presumption that the party entitled to assert it either has
abandoned it or declined to assert it. Where a party sleeps on his rights and allows laches to set in, the same is
fatal to his case.

In their Memorandum however, petitioners, for the first time, invoke estoppel, citing DAR Administrative Order
No. 05 Series of 2006 (DAR AO 05-06) to support their argument that Carriedo waived his right of retention. DAR
AO 05-06 provides for the rules and regulations governing the acquisition and distribution of agricultural lands
subject of conveyances under Sections 6, 70 and 73 (a) of RA No. 6657. Petitioners particularly cite Item no. 4 of
the Statement of Policies of DAR AO 05-06, to wit:

II. Statement of Policies

4. Where the transfer/sale involves more than the five (5) hectares retention area, the transfer is considered
violative of Sec. 6 of R.A. No. 6657.

We cannot sustain petitioners' argument. Their reliance on DAR AO 05-06 is misplaced. As will be seen below,
nowhere in the relevant provisions of RA No. 6657 does it indicate that a multiple or series of transfers/sales of
land would result in the loss of retention rights. Neither do they provide that the multiple or series of transfers
or sales amounts to the waiver of such right.

Section 6 of RA No. 6657 referred to in Item no. 4 of DAR AO 05-06, Section 70 of RA 6657 and Section 73 (a) of
RA No. 6657 as referred to in Item No. 4 of DAR AO 05- are clear in stating that any sale and disposition of
agricultural lands in violation of the RA No. 6657 shall be null and void. Under the facts of this case, the
reasonable reading of these three provisions in relation to the constitutional right of retention should be that
the consequence of nullity pertains to the area/s which were sold, or owned by the transferee, in excess of the
5-hectare land ceiling. Thus, the CA was correct in declaring that the land is Carriedo's retained area.

FALLO

WHEREFORE, premises considered, the motion for reconsideration filed by the Department of Agrarian Reform
is hereby GRANTED, and the Decision dated January 20, 2016 is REVERSED and SET ASIDE. Item No. 4 of DAR
Administrative Order No. 05, Series of 2006 is hereby declared VALID

ON MOTION FOR RECONSIDERATION OF THE DAR in G.R. No. 176549, October 10, 2018, THE SC RULED:

On the validity of Item No. 4, AO 05-06

Applying Item No. 4 of AO 05-06 to the facts of this case, the DAR submits that the subject landholding cannot
be considered as the retained area of Carriedo anymore because he has already exercised his right of retention
when he previously sold his landholdings without DAR clearance. The DAR specifies that sometime in June 1990,
Carriedo unilaterally sold to PLFI his agricultural landholdings with approximately 58.3723 hectares. The DAR,
therefore, argues that Carriedo's act of disposing his landholdings is tantamount to the exercise of his right of
retention under the law.15

Item No. 4 of AO 05-06, provides:

II. STATEMENT OF POLICIES

xxxx

4. Where the transfer/sale involves more than the five (5) hectare retention area, the transfer is considered
violative of Sec. 6 of R.A. No. 6657.

In case of multiple or series of transfers/sales, the first five (5) hectares sold/conveyed without DAR clearance
and the corresponding titles issued by the Register of Deeds (ROD) in the name of the transferee shall, under the
principle of estoppel, be considered valid and shall be treated as the transferor/s' retained area but in no case
shall the transferee exceed the five-hectare landholding ceiling pursuant to Sections 6, 70 and 73(a) of R.A. No.
6657. Insofar as the excess area is concerned, the same shall likewise be covered considering that the transferor
has no right of disposition since CARP coverage has been vested as of 15 June 1988. Any landholding still
registered in the name of the landowner after earlier dispositions totaling an aggregate of five (5) hectares can
no longer be part of his retention area and therefore shall be covered under CARP.

Both the Constitution and CARL underscore the underlying principle of the agrarian reform program, that is, to
endeavor a more equitable and just distribution of agricultural lands taking into account, among others, equity
considerations. We find merit in the DAR's contention that the objective of AO 05-06 is equitable—that in order
to ensure the effective implementation of the CARL, previous sales of landholding (without DAR clearance)
should be treated as the exercise of retention rights of the landowner, as embodied in Item No. 4 of the said
administrative order.

The equity in this policy of AO 05-06 is apparent and easily discernible. By selling his landholdings, it is
reasonably presumed that the landowner already received an amount (as purchase price) commensurate to the
just compensation conformable with the constitutional and statutory requirement. At this point, equity dictates
that he cannot claim anymore, either in the guise of his retention area or otherwise, that which he already
received in the previous sale of his land.

Although constitutionally guaranteed, the exercise of a landowner's right of retention should not be done
without due regard to other considerations which may affect the implementation of the agrarian reform
program. This is especially true when such exercise pays no heed to the intent of the law, or worse, when such
exercise amounts to its circumvention.

In view of the foregoing, we hold that Item No. 4 of AO 05-06 is valid. Indeed, the issue in this case is more
than the mere claim of an individual to his retained area, but had been, at the onset, an issue of the
implementation of the CARL in line with the mandate and objective as set forth in the Constitution.

On Certificate of Land Ownership Award

We agree with the DAR. A Certificate of Land Ownership Award or CLOA is a document evidencing ownership of
the land granted or awarded to the beneficiary by the DAR, and contains the restrictions and conditions
provided for in the CARL and otl1er applicable laws.

Section 24 of the CARL, as amended,34 reads:

Sec. 24. Award to Beneficiaries. - The rights and responsibilities of the beneficiaries shall commence from their
receipt of a duly registered emancipation patent or certificate of land ownership award and their actual physical
possession of the awarded land. Such award shall be completed in not more than one hundred eighty (180) days
from the date of registration of the title in the name of the Republic of the Philippines: Provided, That the
emancipation patents, the certificates of land ownership award, and other titles issued under any agrarian
reform program shall be indefeasible and imprescriptible after one (1) year from its registration with the Office
of the Registry of Deeds, subject to the conditions, limitations and qualifications of this Act, the property
registration decree, and other pertinent laws. The emancipation patents or the certificates of land ownership
award being titles brought under the operation of the torrens system, are conferred with the same
indefeasibility and security afforded to all titles under the said system, as provided for by Presidential Decree
No. 1529, as amended by Republic Act No. 6732. (Emphasis supplied.)

xxxx

Further, in Estribillo v. Department of Agrarian Reform,35 we held that:

The rule in this jurisdiction, regarding public land patents and the character of the certificate of title that may be
issued by virtue thereof, is that where land is granted by the government to a private individual, the
corresponding patent therefor is recorded, and the certificate of title is issued to the grantee; thereafter, the
land is automatically brought within the operation of the Land Registration Act, the title issued to the grantee
becoming entitled to all the safeguards provided in Section 38 of the said Act. In other words, upon expiration of
one year from its issuance, the certificate of title shall become irrevocable and indefeasible like a certificate
issued in a registration proceeding. (Emphasis and italics omitted.)

The EPs themselves, like the Certificates of Land Ownership Award (CLOAs) in Republic Act No. 6657 (the
Comprehensive Agrarian Reform Law of 1988), are enrolled in the Torrens system of registration. The Property
Registration Decree in fact devotes Chapter IX on the subject of EPs. Indeed, such EPs and CLOAs are, in
themselves, entitled to be as indefeasible as certificates of title issued in registration proceedings.36 (Citation
omitted.

We, however, note that the issue involving the issuance, recall, or cancellation of CLOAs is lodged with the DAR,
which has primary jurisdiction over the matter.

FALLO

WHEREFORE, premises considered, the motion for reconsideration filed by the Department of Agrarian Reform
is hereby GRANTED, and the Decision dated January 20, 2016 is REVERSED and SET ASIDE. Item No. 4 of DAR
Administrative Order No. 05, Series of 2006 is hereby declared VALID.