Case Digest: Mango v. Barbin G.R. No. 173923Oct. 12, 2009 603 SCRA 232 (2009)

Mango v. Barbin
G.R. No. 173923
Oct. 12, 2009
603 SCRA 232 (2009)

Facts: 
On 11 November 1994, respondent Juana Z. Barbin filed with the Provincial Agrarian Reform Adjudicator (PARAD) of Camarines Norte an action for Cancellation of Emancipation Patents, Disqualification of Tenant-Beneficiary, Repossession and Damages. Respondent alleged that she is the owner in fee simple of an irrigated riceland located in Barangay Guinacutan, Vinzons, Camarines Norte, with an area of 4.7823 hectares, and that Augusto Mago, Crispin Mago, Ernesto Mago, and Pedro Mago were tenants of the subject landholding. Respondent further alleged that petitioners violated the terms of their leasehold contracts when they failed to pay lease rentals for more than two years, which is a ground for their dispossession of the landholding.

On the other hand, petitioners alleged that the subject landholding was placed under the Operation Land Transfer program of the government pursuant to PD 27. Respondent’s original title was then cancelled and the subject landholding was transferred to petitioners who were issued Emancipation Patents by the DAR. The Transfer Certificates of Title issued to petitioners emanating from the Emancipation Patents were registered with the Registry of Deeds. Petitioners averred that prior to the issuance of the Emancipation Patents, they already delivered their lease rentals to respondent.They further alleged that after the issuance of the Emancipation Patents, the subject landholding ceased to be covered by any leasehold contract.

In the Decision dated 30 January 1997, Department of Agrarian Reform Adjudication Board (DARAB):
1. ordered the Register of Deeds of Camarines Norte to cancel EP Nos. 745, 747, and 749 issued in the name of Augusto Mago, Ernesto Mago, and Pedro Mago respectively, and
2. directed the Municipal Agrarian Reform Officer of Vinzons, Camarines Norte, to reallocate the subject lands to qualified beneficiaries.
DARAB held that when the subject landholding was placed under the Operation Land Transfer, the tenancy relationship between the parties ceased and the tenant-beneficiaries were no longer required to pay lease rentals to the landowner. However, when petitioners entered into an agreement with respondent for a direct payment scheme embodied in the Deeds of Transfer, petitioners obligated themselves to pay their amortizations to respondent who is the landowner. CA held that the mere issuance of an Emancipation Patent to a qualified farmer-beneficiary is not absolute and can be attacked anytime upon showing of any irregularity in its issuance or non-compliance with the conditions attached to it. The Emancipation Patent is subject to thecondition that amortization payments be remitted promptly to the landowner and that failure to comply with this condition is a ground for cancellation.

Issue:
Whether or not the Emancipation Patents and Transfer Certificates of Title issued to petitioners which were already registered with the Register of Deeds have already become indefeasible and can no longer be cancelled.

Held:
N0. Emancipation patents issued to agrarian reform beneficiaries may be corrected and cancelled for violations of agrarian laws, rules and regulations. In fact, DAR Administrative Order No. 02, series of 1994, which was issued in March 1994, enumerates the grounds for cancellation of registered Emancipation Patents or Certificates of Landownership Award:

Grounds for the cancellation of registered EPs [Emancipation Patents] or CLOAs [Certificates of Landownership Award] may include but not be limited to the following:
1. Misuse or diversion of financial and support services extended to the ARB [Agrarian Reform Beneficiaries]; (Section 37 of R.A. No. 6657)
2. Misuse of the land; (Section 22 of R.A. No. 6657)
3. Material misrepresentation of the ARB’s basic qualifications as provided under Section 22 of R.A. No. 6657, P.D. No. 27, and other agrarian laws;
4. Illegal conversion by the ARB; (Cf. Section 73, Paragraphs C and E of R.A. No. 6657)
5. Sale, transfer, lease or other forms of conveyance by a beneficiary of the right to use or any other usufructuary right over the land acquired by virtue of being a beneficiary, in order to circumvent the provisions of Section 73 of R.A. No. 6657, P.D. No. 27, and other agrarian laws. However, if the land has been acquired under P.D. No. 27/E.O. No. 228, ownership may be transferred after full payment of amortization by the beneficiary; (Sec. 6 of E.O. No. 228)6. Default in the obligation to pay an aggregate of three (3) consecutive amortizations in case of voluntary land transfer/direct payment scheme, except in cases of fortuitous events and force majeure; (Emphasis supplied)
7. Failure of the ARBs to pay for at least three (3) annual amortizations to the LBP, except in cases of fortuitous events and force majeure; (Section 26 of RA 6657)
8. Neglect or abandonment of the awarded land continuously for a period of two (2) calendar years as determined by the Secretary or his authorized representative; (Section 22 of RA 6657)
9. The land is found to be exempt/excluded from P.D. No. 27/E.O. No. 228 or CARP coverage or to be part of the landowner’s retained area as determined by the Secretary or his authorized representative; and
10. Other grounds that will circumvent laws related to the implementation of agrarian reform program.

In this case, petitioners entered into an agreement with respondent for a direct payment scheme embodied in the Deeds of Transfer. However, petitioners failed to pay the amortizations to respondent landowner in accordance with their agreed direct payment scheme.

​In the first place, the Emancipation Patents and the Transfer Certificates of Title should not have been issued to petitioners without full payment of the just compensation. Under Section 2 of Presidential Decree No. 266, the DAR will issue the Emancipation Patents only after the tenant-farmers have fully complied with the requirements for a grant of title under PD​27. Although PD 27 states that the tenant-farmers are already deemed owners of the land they till, it is understood that full payment of the just compensation has to be made first before title is transferred to them. Thus, Section 6 of EO 228 provides that ownership of lands acquired under PD 27 may be transferred only after the agrarian reform beneficiary has fully paid the amortizations.