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Tag: DAR A.O. No. 9

  • Livestock Farms and Agrarian Reform: Understanding CARP Exemption in the Philippines

    Protecting Livestock Farms: How Philippine Law Exempts Animal Husbandry from Agrarian Reform

    Navigating land ownership and agrarian reform in the Philippines can be complex, especially for landowners engaged in livestock farming. This landmark Supreme Court case clarifies that land exclusively dedicated to livestock raising is generally exempt from the Comprehensive Agrarian Reform Program (CARP), safeguarding the interests of agricultural businesses beyond traditional crop cultivation.

    G.R. NO. 169277, February 09, 2007

    INTRODUCTION

    Imagine owning a farm passed down through generations, dedicated to raising cattle for decades. Suddenly, the government declares your land subject to agrarian reform, potentially displacing your livelihood. This was the predicament faced by the respondent in this case, highlighting the critical intersection of agrarian reform and livestock farming in the Philippines. At the heart of the legal battle was a fundamental question: Should land consistently used for livestock raising be subject to redistribution under the Comprehensive Agrarian Reform Program (CARP)? This Supreme Court decision provides a definitive answer, reaffirming the exemption of livestock farms from CARP coverage and setting a crucial precedent for agricultural landowners.

    LEGAL CONTEXT: LUZ FARMS AND THE EXEMPTION OF LIVESTOCK

    The legal foundation for exempting livestock farms from CARP rests on the landmark case of Luz Farms v. Secretary of the Department of Agrarian Reform. In this 1990 ruling, the Supreme Court declared key provisions of Republic Act No. 6657, the Comprehensive Agrarian Reform Law of 1988 (CARL), unconstitutional insofar as they included lands devoted to livestock, poultry, and swine raising within the agrarian reform program. The Court reasoned that raising livestock is an industrial, not agricultural, activity. This distinction is crucial because CARP, as mandated by the Constitution, focuses on the redistribution of agricultural land to landless farmers.

    The Supreme Court in Luz Farms explicitly stated:

    “[L]ivestock, poultry and swine raising are industrial activities. They are not agricultural, and the lands devoted to them are not agricultural lands. Therefore, Sections 3(b), 11, 13 and 32 of RA 6657, insofar as they include livestock and poultry in the definition of ‘agricultural land’ and ‘agricultural activity’ are invalid because they are not in accordance with the constitutional mandate…”

    Following Luz Farms, the Department of Agrarian Reform (DAR) issued Administrative Order No. 9, Series of 1993 (A.O. No. 9). While seemingly implementing Luz Farms, A.O. No. 9 introduced specific ratios of land to livestock and stipulated that only lands “exclusively, directly and actually used for livestock, poultry and swine raising as of 15 June 1988” would be excluded from CARP. This administrative order aimed to prevent landowners from fraudulently converting agricultural lands to livestock farms solely to evade CARP coverage. However, as this case reveals, the interpretation and application of A.O. No. 9 became a point of contention.

    CASE BREAKDOWN: UY VS. DEPARTMENT OF AGRARIAN REFORM

    The case of Department of Agrarian Reform vs. Vicente K. Uy revolved around a 349.9996-hectare property in Quezon province, owned by Vicente Uy and his co-owners. In 1994, forty-four farmers occupying portions of the land petitioned the DAR to be declared beneficiaries under CARP. Uy, on behalf of the owners, applied for exclusion from CARP coverage, arguing that the land had been exclusively used for livestock raising since before June 15, 1988, the effectivity of CARP.

    Here’s a breakdown of the procedural journey:

    1. Initial DAR Investigation (1995): A Provincial Task Force inspected the property, finding 429 heads of livestock (cattle, horses, carabaos) and some coconut trees. The Task Force recommended partial exclusion, suggesting areas occupied by tenants should remain under CARP.
    2. PARO and Regional Director Decisions (1995): The Provincial Agrarian Reform Officer (PARO) recommended excluding 219.50 hectares based on livestock count and infrastructure. The Regional Director affirmed this.
    3. DAR Secretary Order (1996): On appeal, the DAR Secretary partially granted exclusion for 219.50 hectares. The DAR considered only livestock aged seven years or older in 1995 as proof of existence in 1988, applying a strict interpretation of A.O. No. 9.
    4. Office of the President (OP) Decision (1998): The OP affirmed the DAR Secretary’s decision, emphasizing that livestock must have existed on the land as of June 15, 1988, to be counted for exemption.
    5. Court of Appeals (CA) Initial Decision (2003): The CA initially affirmed the OP, upholding the DAR’s partial exemption.
    6. CA Amended Decision (2004): Upon reconsideration, the CA reversed its decision and exempted the entire 349.9996 hectares, along with an additional 22.2639-hectare contiguous property (TCT No. 11948). The CA interpreted A.O. No. 9’s “regardless of age” clause to mean that all livestock present during inspection should be counted, not just those supposedly existing in 1988.
    7. Supreme Court Decision (2007): The Supreme Court partially granted DAR’s petition, affirming the CA’s amended decision for the 349.9996-hectare property (TCT No. 160988) but reversing it for the 22.2639-hectare property (TCT No. 11948).

    The Supreme Court’s reasoning hinged on the unconstitutionality of DAR A.O. No. 9, as previously declared in Department of Agrarian Reform v. Sutton. The Court reiterated that Luz Farms definitively excluded livestock farms from CARP coverage. Justice Callejo, writing for the Court, emphasized:

    “Clearly, petitioner DAR has no power to regulate livestock farms which have been exempted by the Constitution from the coverage of agrarian reform. It has exceeded its power in issuing the assailed A.O.”

    Regarding the presence of coconut trees and tenant farmers, the Supreme Court found these to be incidental to the primary use of the land for livestock raising. The Court noted that the coconut trees provided shade and supplementary fodder, and the tenant farmers’ presence did not negate the land’s principal use for livestock. However, the Court reversed the CA’s exemption of the 22.2639-hectare property due to a lack of evidence showing it was ever included in CARP coverage or investigated by the DAR.

    PRACTICAL IMPLICATIONS: SECURING CARP EXEMPTION FOR LIVESTOCK FARMS

    This Supreme Court decision reinforces the principle established in Luz Farms: land exclusively and directly used for livestock raising is exempt from CARP. While DAR A.O. No. 9 attempted to regulate this exemption, the Supreme Court, in line with Sutton, deemed it unconstitutional to the extent it curtailed the constitutional exemption. For landowners engaged in livestock farming, this ruling offers significant protection against CARP coverage.

    Key Lessons for Livestock Farm Owners:

    • Continuous Use is Key: The exemption applies to land exclusively, directly, and actually used for livestock raising. Maintaining this consistent use is crucial.
    • Documentation Matters: While A.O. No. 9’s strict 1988 deadline was invalidated, documenting the history of livestock operations on the land remains important to demonstrate continuous use. Business permits, ownership records of livestock, and any historical evidence can be valuable.
    • Incidental Agricultural Activity: The presence of some coconut trees or tenant farmers engaged in minor agricultural activities does not automatically negate the livestock exemption if the primary land use remains livestock raising.
    • Focus on Land Classification: The classification of land as agricultural in general terms does not automatically subject it to CARP if it is specifically used for industrial activities like livestock raising.
    • Seek Legal Counsel: Navigating CARP and exemption processes can be complex. Consulting with legal professionals experienced in agrarian law is advisable when facing CARP coverage issues.

    FREQUENTLY ASKED QUESTIONS (FAQs)

    Q1: Does this ruling mean all land with livestock is exempt from CARP?

    A: Not necessarily all land, but land that is exclusively, directly, and actually used for livestock, poultry, or swine raising is generally exempt based on the Luz Farms doctrine. The key is demonstrating the primary and actual use of the land.

    Q2: What kind of proof is needed to show land is used for livestock raising?

    A: Evidence can include business permits, records of livestock ownership and sales, infrastructure for livestock (corrals, barns, etc.), testimonies, and historical documentation showing continuous livestock operations.

    Q3: If my livestock farm also has some coconut trees or crops, can it still be exempt?

    A: Yes, potentially. The Supreme Court in Uy recognized that incidental agricultural activities, like coconut trees for shade and fodder, do not negate the primary use for livestock raising. The focus is on the dominant land use.

    Q4: Is the age of livestock important for CARP exemption?

    A: No, according to this ruling and the invalidation of A.O. No. 9’s strict interpretation. The focus should be on the current and historical use of the land for livestock, not rigidly tracing livestock back to June 15, 1988.

    Q5: What should I do if my livestock farm is being subjected to CARP coverage?

    A: First, gather evidence to demonstrate that your land is primarily and actually used for livestock raising. Then, seek legal counsel to help you file an application for exemption with the DAR and, if necessary, appeal adverse decisions to the courts.

    Q6: Does this exemption apply to all types of livestock farms?

    A: Yes, the Luz Farms ruling and this case cover livestock, poultry, and swine raising. The principle is that these are considered industrial activities distinct from traditional agriculture covered by CARP.

    ASG Law specializes in Agrarian Law and Property Rights. Contact us or email hello@asglawpartners.com to schedule a consultation.

  • Livestock Lands Untouchable: DAR A.O. No. 9 Declared Unconstitutional

    The Supreme Court affirmed that lands devoted to livestock, swine, and poultry raising are industrial, not agricultural, and therefore, not subject to agrarian reform. The decision invalidates DAR Administrative Order (A.O.) No. 9, series of 1993, which attempted to regulate livestock farms by setting retention limits. This protects landowners who have dedicated their property to livestock farming from being forced to redistribute their land under the Comprehensive Agrarian Reform Law (CARL), as such activities are deemed industrial rather than agricultural. This effectively reinforces the constitutional intent to exclude livestock farms from agrarian reform coverage, securing property rights in the livestock industry.

    Pasture vs. Progress: Can Agrarian Reform Graze on Livestock Farms?

    The case of Department of Agrarian Reform vs. Delia T. Sutton, Ella T. Sutton-Soliman, and Harry T. Sutton revolves around a disputed parcel of land in Masbate, primarily used for cow and calf breeding. The respondents, the Suttons, voluntarily offered to sell their land to the Department of Agrarian Reform (DAR) under the existing agrarian reform program. However, with the enactment of Republic Act (R.A.) No. 6657, also known as the Comprehensive Agrarian Reform Law (CARL) of 1988, which initially included livestock farms within its coverage, and the subsequent Luz Farms ruling, the Suttons sought to withdraw their offer, arguing that their cattle-raising activities should exempt their land from agrarian reform.

    The crux of the matter lies in the validity of DAR Administrative Order No. 9, series of 1993 (A.O. No. 9), which prescribed retention limits for lands used for livestock raising. DAR argued that the A.O. was necessary to prevent landowners from evading agrarian reform by converting agricultural lands to livestock farms. The Suttons contended that A.O. No. 9 contravened the 1987 Constitutional Commission’s intent to exclude livestock farms from land reform, a position supported by the Supreme Court’s ruling in Luz Farms v. Secretary of DAR. The central legal question, therefore, is whether DAR exceeded its authority by issuing A.O. No. 9, thereby contradicting the Constitution and established jurisprudence.

    The Supreme Court anchored its decision on the principle that administrative agencies, while possessing rule-making authority, cannot overstep constitutional bounds. **Administrative rules and regulations must be authorized by law and must not contravene the Constitution.** The court emphasized that DAR’s attempt to regulate livestock farms through A.O. No. 9 was an overreach of its delegated power.

    To be valid, administrative rules and regulations must be issued by authority of a law and must not contravene the provisions of the Constitution. The rule-making power of an administrative agency may not be used to abridge the authority given to it by Congress or by the Constitution.

    The Court highlighted the intent of the 1987 Constitutional Commission to exclude lands exclusively devoted to livestock, swine, and poultry-raising from agrarian reform. Citing the landmark case of Luz Farms, the Court reiterated that **livestock, swine, and poultry-raising are industrial activities, not agricultural ones**, thus falling outside the scope of agrarian reform. This distinction is critical because it acknowledges the significant industrial investment involved in livestock operations, distinguishing them from traditional crop or tree farming.

    Further solidifying this stance, the Court referred to the case of Natalia Realty, Inc. v. DAR, where it was held that industrial, commercial, and residential lands are not covered by CARL. This precedent reinforced the principle that the term “agricultural land” does not include lands classified for non-agricultural purposes. The Suttons’ case was analogous because their land, dedicated to cattle-raising, was effectively classified as industrial and thus exempt from agrarian reform.

    The Supreme Court also addressed DAR’s concern that landowners might convert agricultural lands to livestock farms to evade agrarian reform. The Court found this argument unconvincing, as the Suttons had been engaged in cattle-breeding since 1948, long before the enactment of CARL. **The law prohibits the conversion of agricultural lands to non-agricultural purposes after the effectivity of CARL**, and the Suttons had not altered their business interests.

    The Court also noted that after the passage of the 1988 CARL, Congress enacted R.A. No. 7881, which amended certain provisions of the CARL. This new law changed the definition of “agricultural activity” and “commercial farming” by excluding lands devoted to commercial livestock, poultry, and swine-raising. This legislative modification aligned the agrarian laws with the Constitutional Commission’s intent to exclude livestock farms from agrarian reform.

    Ultimately, the Supreme Court held that A.O. No. 9 was unconstitutional because it enlarged the coverage of agrarian reform beyond the scope intended by the 1987 Constitution. This decision safeguards the property rights of those engaged in livestock, swine, and poultry-raising by confirming that their lands are not subject to redistribution under agrarian reform laws. By reinforcing the constitutional limitations on agrarian reform, this ruling provides clarity and protection for businesses in the livestock sector, allowing them to operate without the threat of land redistribution.

    FAQs

    What was the key issue in this case? The central issue was whether DAR Administrative Order No. 9, which prescribed retention limits for lands used for livestock raising, was constitutional, given the constitutional intent to exclude such lands from agrarian reform.
    What is DAR A.O. No. 9? DAR A.O. No. 9, series of 1993, is an administrative order issued by the Department of Agrarian Reform that provided retention limits for lands used for the raising of livestock, poultry, and swine. It aimed to regulate these farms under the Comprehensive Agrarian Reform Law (CARL).
    What did the Supreme Court rule about DAR A.O. No. 9? The Supreme Court declared DAR A.O. No. 9 unconstitutional because it exceeded the scope of agrarian reform intended by the 1987 Constitution by including livestock farms, which are considered industrial, not agricultural, activities.
    What was the Luz Farms ruling? The Luz Farms ruling is a Supreme Court decision that stated that livestock, swine, and poultry-raising are industrial activities and do not fall within the definition of “agriculture” or “agricultural activity,” thus excluding such lands from agrarian reform.
    Why did the Suttons want to withdraw their voluntary offer to sell? The Suttons wanted to withdraw their voluntary offer to sell their land because they argued that their land was devoted exclusively to cattle-raising and should, therefore, be exempt from the coverage of the Comprehensive Agrarian Reform Law (CARL).
    What is the significance of R.A. No. 7881 in this case? R.A. No. 7881 amended the CARL by changing the definition of “agricultural activity” and “commercial farming” to exclude lands devoted to commercial livestock, poultry, and swine-raising, aligning the agrarian laws with the constitutional intent to exclude livestock farms.
    What is the practical effect of this ruling for landowners? The practical effect of this ruling is that landowners who have dedicated their property to livestock, swine, and poultry-raising are protected from having their lands redistributed under agrarian reform laws, ensuring the security of their investments and operations.
    How does this case relate to the Natalia Realty case? The Natalia Realty case established that industrial, commercial, and residential lands are not covered by the CARL, reinforcing the principle that “agricultural land” does not include lands classified for non-agricultural purposes, thus supporting the exclusion of livestock farms.
    What was DAR’s argument for issuing A.O. No. 9? DAR argued that A.O. No. 9 was necessary to prevent landowners from evading agrarian reform by converting agricultural lands to livestock farms, ensuring that the agrarian reform program’s objectives were not circumvented.

    In conclusion, the Supreme Court’s decision reinforces the constitutional boundaries of agrarian reform, clarifying that lands devoted to livestock and poultry-raising are beyond its reach. This ruling offers critical protection to landowners engaged in these industries, ensuring that their property rights are upheld and their operations are not disrupted by land redistribution efforts. The Court reaffirmed its commitment to safeguarding constitutional principles and preventing administrative overreach.

    For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

    Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
    Source: DEPARTMENT OF AGRARIAN REFORM vs. DELIA T. SUTTON, G.R. NO. 162070, October 19, 2005