FACTS:

The main subject of the seven consolidated petitions is the application of petitioner Roxas & Co., Inc. (Roxas & Co.) for conversion from agricultural to non-agricultural use of its three haciendas located in Nasugbu, Batangas.

Before the effectivity of the Comprehensive Agrarian Reform Law (CARL), Roxas & Co. voluntarily offered to sell Hacienda Caylaway. Haciendas Palico and Banilad were later placed under compulsory acquisition by the Department of Agrarian Reform (DAR) in accordance with the CARL.

Roxas & Co. later withdrew its voluntary offer to sell Hacienda Caylaway and informed the DAR that it was applying for conversion of the hacienda from agricultural to other uses.

The interpretation of Presidential Proclamation (PP) 1520, which declared Nasugbu, Batangas as a tourist zone, is also an issue in some of the petitions.

Roxas & Co. filed an application for exemption from CARP based on PP 1520 and DAR Administrative Order (AO) No. 6, Series of 1994. The Sangguniang Bayan of Nasugbu also enacted Municipal Zoning Ordinance No. 4, which was approved in 1983.

The case involves several petitions filed by landowners and farmers who are affected by the conversion of agricultural lands into tourism zones.

The Department of Agrarian Reform (DAR) maintains that the lands within the proclaimed tourism zones are exempted from CARP coverage based on Presidential Proclamation (PP) No. 1520.

The petitioners dispute the DAR's interpretation of PP No. 1520 and argue that the proclamation did not reclassify the lands into non-agricultural use.

The petitioners also argue that other similarly worded proclamations declaring certain provinces and areas as tourism zones did not intend to reclassify all agricultural lands into non-agricultural use.

The petitioners further contend that the Special Economic Zone Act of 1995 provides a parallel orientation on the issue.

The petitioners also reference other decrees and events during the martial law era, such as PD No. 2 declaring the entire Philippines as a land reform area and PD No. 27 awarding private agricultural lands primarily devoted to rice and corn to tenant-farmers.

Relevant to the case is the issuance of Executive Order No. 647 by President Arroyo, which proclaimed the areas in the Nasugbu Tourism Development Plan as Special Tourism Zones.

The passage of the Tourism Act of 2009 is also cited by the petitioners, as it specifically declares that lands identified as part of a tourism zone shall qualify for exemption from CARP coverage.

Overall, the petitioners argue that the lands covered by the tourism zones should not be exempted from CARP coverage and that PP No. 1520 did not reclassify the lands into non-agricultural use. They contend that the lands should still be subject to CARP and their conversion should go through the required process.

In DAR Administrative Case No. A-9999-142-97, Roxas & Co. filed a petition for CARP exemption for Hacienda Palico. The dissenting opinion argues that the subsequent issuances, which came after the effectivity of CARP, cannot be applied retroactively.

The Court notes that Roxas & Co. can only rely on the provisions of the Tourism Act, not on PP 1520, for possible exemption. Additionally, there are discrepancies in the location and identity of the subject parcels of land, therefore, granting CARP exemption is not warranted.

ISSUES:

1. Whether the lands identified as part of a tourism zone are exempt from CARP coverage.

2. Whether the lands in Hacienda Palico have been reclassified to non-agricultural uses.

3. Whether the properties applied for exemption by Roxas & Co. are the same properties covered by their submitted certifications and titles.

4. Whether the properties are located within the Industrial Zone classified under Municipal Ordinance No. 4.

5. Whether the DAR Secretary committed grave abuse of discretion in considering inconsistent certifications.

6. Whether the farmer-occupants should be informed of the pending application for exemption.

7. Whether the cancellation of the Certificates of Land Ownership Award (CLOAs) issued to the farmer-beneficiaries is necessary.

8. Whether the petitions for partial and complete cancellations of the Certificates of Land Ownership Awards (CLOAs) violated a previous order.

9. Whether the appellate court committed reversible error by giving due course to the appeal of DAMBA-NSFW.

10. Whether the CLOAs issued for nine parcels of land should be cancelled.

11. Whether Roxas & Co. failed to prove that the other lots in Hacienda Palico and the other two haciendas are Comprehensive Agrarian Reform Program (CARP)-exempt.

12. Whether Roxas & Co. is mandated to provide disturbance compensation to affected farmer-beneficiaries before the cancellation of the CLOAs.

13. Whether the Court of Appeals erred in ruling in favor of DAMBA-NSFW in CA-G.R. SP No. 82225.

14. Whether the Court of Appeals erred in ruling against Roxas & Co. in CA-G.R. SP No. 82226.

15. Whether the Court of Appeals erred in ruling against Roxas & Co. in the September 10, 2004 Decision and April 14, 2005 Resolution.

16. Whether the Provincial Agrarian Reform Adjudicator erred in ordering the cancellation of CLOA No. 6654 and granting the partial cancellation of other CLOAs.

RULING:

1. The lands identified as part of a tourism zone are exempt from CARP coverage. It is explicitly declared under the Tourism Act that lands identified as part of a tourism zone shall qualify for exemption from CARP coverage.

2. The lands in Hacienda Palico have not been reclassified to non-agricultural uses. The subject parcels of land have not been reclassified to non-agricultural uses via Nasugbu MZO No. 4, and therefore cannot be exempted from CARP coverage.

3. The Court finds that there is no indication that the properties referred to in the certifications and titles are the same properties applied for exemption by Roxas & Co. Furthermore, Roxas & Co. failed to submit a title covering some of the properties.

4. The Court ruled that the properties covered by the TCTs submitted by Roxas & Co. are located in Barrio Lumbangan, not in Barangay Cogunan which is classified as an Industrial Zone under Municipal Ordinance No. 4.

5. The Court found that the DAR Secretary committed grave abuse of discretion in considering inconsistent certifications submitted by Roxas & Co. The DAR Secretary should have required Roxas & Co. to submit the comprehensive land use plan to determine the exact locations of the properties.

6. The Court held that the farmer-occupants need not be notified of the pending application for exemption. The application for CARP-exemption is non-adversarial or non-litigious in nature, and the rules do not require the notification of occupants of a landholding. The Court cited the case of Roxas & Co., Inc. v. Court of Appeals, which held that the failure to comply with the requisites of due process in acquisition proceedings does not give the Court the power to nullify CLOAs already issued to farmer beneficiaries since they hold the property in trust for the rightful owner.

7. The Court ruled that the CLOAs issued to the farmer-beneficiaries must be cancelled. Since the subject landholding has been determined to be CARP-exempt, the previous issuance of the CLOAs to the farmer-beneficiaries is erroneous. The farmer-beneficiaries only hold the property in trust for the rightful owners of the land, and therefore, the cancellation of the CLOAs is necessary.

8. The petitions for partial and complete cancellations of the CLOAs did not violate the earlier order. The Court clarified that the previous order only stated that the Department of Agrarian Reform (DAR) has primary jurisdiction to rule on the validity of the CLOAs, and did not declare that the CLOAs cannot and should not be cancelled.

9. The appellate court did not commit reversible error by giving due course to the appeal of DAMBA-NSFW. The Court justified the relaxation of the rules on appeals due to the pressing need for an extensive discussion of the issues and the importance of the matter, which involved the possible displacement of hundreds of farmer-beneficiaries and their families.

10. The CLOAs issued for nine parcels of land, which are portions of TCT No. 985 covering 45.9771 hectares in Hacienda Palico, must be cancelled.

11. Roxas & Co. failed to prove that the other lots in Hacienda Palico and the other two haciendas are CARP-exempt. Therefore, the CLOAs for these lots must be respected.

12. Roxas & Co. is mandated to provide disturbance compensation to affected farmer-beneficiaries before the cancellation of the CLOAs.

13. The Court grants the petition for review of DAMBA-NSFW and reverses and sets aside the October 31, 2006 Decision and August 16, 2007 Resolution of the Court of Appeals in CA-G.R. SP No. 82225.

14. The Court denies the petition for review of DAMBA-NSFW and affirms the December 20, 2004 Decision and March 7, 2005 Resolution of the Court of Appeals in CA-G.R. SP No. 82226.

15. The Court denies Roxas & Co.'s petition for review for lack of merit and affirms the September 10, 2004 Decision and April 14, 2005 Resolution of the Court of Appeals.

16. The Court sets aside the Decisions of the Provincial Agrarian Reform Adjudicator in DARAB Case No. 401-239-2001 ordering the cancellation of CLOA No. 6654 and DARAB Cases Nos. R-401-003-2001 to No. R-401-005-2001 granting the partial cancellation of CLOA No. 6654. The CLOAs issued for Lots No. 21 No. 24, No. 26, No. 31, No. 32 and No. 34 or those covered by DAR Administrative Case No. A-9999-142-97) remain.

PRINCIPLES:

• Mere reclassification of an agricultural land does not automatically allow a landowner to change its use. There is still a process of conversion before one is permitted to use it for other purposes.

• Lands identified as part of a tourism zone qualify for exemption from CARP coverage under the Tourism Act.

• A local government unit has the power to classify and convert land from agricultural to non-agricultural prior to the effectivity of the Comprehensive Agrarian Reform Law.

• Findings of facts of quasi-judicial agencies are generally accorded great weight and finality if supported by substantial evidence, but this does not apply if there are glaring inconsistencies in the evidence.

• Certifications submitted as evidence should be consistent and reliable. The presumption of regularity in their issuance cannot be applied if there are doubts on the location and identity of the subject properties.

• It is essential to present the comprehensive land use plan to prove the exact locations of properties and their compliance with zoning ordinances.

• An application for CARP-exemption is non-adversarial or non-litigious in nature, and the rules do not require the notification of occupants of a landholding.

• The failure to comply with the requisites of due process in acquisition proceedings does not give the Court the power to nullify CLOAs already issued to farmer beneficiaries.

• Farmer beneficiaries hold the property in trust for the rightful owner of the land.

• The DAR has primary jurisdiction to rule on the validity of Certificates of Land Ownership Awards (CLOAs).

• The DARAB, as a quasi-judicial body, is not bound to strictly observe rules of procedure and evidence.

• The relaxation of rules on appeals may be allowed for meritorious reasons in the interest of justice.

• Republic Act No. 3844 mandates the provision of disturbance compensation to tenants of landholdings declared suited for non-agricultural use.

• The satisfaction of disturbance compensation is required before the cancellation of CLOAs can be implemented.

• The Court has the power to review decisions of the Court of Appeals.

• The Court may deny a petition for lack of merit.

• The Court may set aside decisions of the Provincial Agrarian Reform Adjudicator.