G.R. No.

133507           February 17, 2000

EUDOSIA DAEZ v CA

Petition for review on certiorari of the Decision of the Court of Appeals2  which denied the application of petitioner heirs of
Eudosia Daez for the retention of a 4.1685-hectare riceland pursuant to Republic Act (R.A.) No. 6657, otherwise known as
the Comprehensive Agrarian Reform Law3.

The pertinent facts are:

 Eudosia Daez, now deceased, was the owner of a 4.1685-hectare riceland in Barangay Lawa, Meycauayan,
Bulacan which was being cultivated by respondents Macario Soriente, Rogelio Macatulad, Apolonio Mediana and
Manuel Umali under a system of share-tenancy.

 The said land was subjected to the Operation Land Transfer (OLT) Program under Presidential Decree (P.D.) No.
278 as amended by Letter of Instruction (LOI) No. 4749.

 Thus, the then Ministry of Agrarian Reform acquired the subject land and issued Certificates of Land Transfer
(CLT) on December 9, 1980 to private respondents as beneficiaries.

 However, on May 31, 1981, Eudosia daez signed an affidavit, allegedly under duress, stating that they are not
share tenants but hired laborers.

 Armed with such document, Eudosia Daez applied for the exemption of said riceland from coverage of P.D. No.
27 due to non-tenancy as well as for the cancellation of the CLTs issued to private respondents.

 In their Affidavit dated October 2, 1983, Eudosia Daez and her husband, Lope, declared ownership over 41.8064
hectares of agricultural lands located in Meycauayan, Bulacan and fourteen (14) hectares of riceland,

 DAR Undersecretary Jose C. Medina issued an Order denying Eudosia Daez's application for exemption upon
finding that her subject land is covered under LOI No. 474, petitioner being owner of the aforesaid agricultural
lands exceeding seven (7) hectares12.

 Eudosia Daez wrote a letter to DAR Secretary Benjamin T. Leong requesting for reconsideration denial of
Undersecretary Medina's order.

 Secretary Leong affirmed the assailed order upon finding private respondents to be bonafide tenants of the
subject land.

 Eudosia Daez brought her case to the Court of Appeals via a petition for  certiorari.

 The Court of Appeals, however, sustained the order of Secretary Leon

 Eudosia pursued her petition before this court but we denied. We also denied her motion for reconsideration

 Meantime, on August 6 and 12, 1992, the DAR issued Emancipation Patents (EPs) to private respondents.

 Thereafter, the Register of Deeds of Bulacan issued the corresponding Transfer Certificates of Title (TCTs).

 Aftr filing for an Exemption of the 4.1685 riceland from coverage by P.D. No. 27 having been finally denied her,
Eudosia Daez next filed an application for retention of the same riceland, this time under R.A. No. 6657.

 In an order dated March 22, 1994, DAR Region III OIC-Director Eugenio B. Bernardo allowed Eudosia Daez to
retain the subject riceland but he denied the application of her eight (8) children to retain three (3) hectares
each for their failure to prove actual tillage of the land or direct management thereof as required by law

Aggrieved, they appealed to the DAR.

 She appealed Secretary Garilao's decision to the Office of the President which ruled in her favor.

 Aggrieved, private respondents sought from the Court of Appeals, a review of the decision of the Office of the
President.

On January 28, 1999, the said Decision of the Office of the President was reversed.
ISSUE(S):
 W/N the finality of judgment in exemption (PD27) does preclude the subsequent institution of
application for retention (RA 6657).
 W/N the heirs of Eudosia Daez may exercise their right of retention over the subject 4.1685 riceland.
 W/N the land awards made pursuant to the governments agrarian reform program are subject to the
exercise by a landowner of his right of retention.

We grant the petition.

First. Exemption and retention in agrarian reform are two (2) distinct concepts. yes

P.D. No. 27, which implemented the Operation Land Transfer (OLT) Program, covers tenanted rice or corn lands.

The requisites for coverage under the OLT program are the following: (1) the land must be devoted to rice or corn crops;
and (2) there must be a system of share-crop or lease-tenancy obtaining therein. If either requisite is absent, a landowner
may apply for exemption. If either of these requisites is absent, the land is not covered under OLT. Hence, a landowner
need not apply for retention where his ownership over the entire landholding is intact and undisturbed.

P.D. No. 27 grants each tenant of covered lands a five (5)-hectare lot, or in case the land is irrigated, a three (3)-hectare lot
constituting a family size farm. However, said law allows a covered landowner to retain not more than seven (7) hectares of
his land if his aggregate landholding does not exceed twenty-four (24) hectares. Otherwise, his entire landholding is
covered without him being entitled to any retention right 20.

Consequently, a landowner may keep his entire covered landholding if its aggregate size does not exceed the retention
limit of seven (7) hectares.

In effect, his land will not be covered at all by the OLT program although all requisites for coverage are present.

LOI No. 474 clarified the effective coverage of OLT to include tenanted rice or corn lands of seven (7) hectares or less, if the
landowner owns other agricultural lands of more than seven (7) hectares.

The term "other agricultural lands" refers to lands other than tenanted rice or corn lands from which the landowner
derives adequate income to support his family.

Thus, on one hand, exemption from coverage of OLT lies if: (1) the land is not devoted to rice or corn crops even if it is
tenanted; or (2) the land is untenanted even though it is devoted to rice or corn crops.

On the other hand, the requisites for the exercise by the landowner of his right of retention are the following: (1) the land
must be devoted to rice or corn crops; (2) there must be a system of share-crop or lease-tenancy obtaining therein; and (3)
the size of the landholding must not exceed twenty-four (24) hectares, or it could be more than twenty-four (24) hectares
provided that at least seven (7) hectares thereof are covered lands and more than seven (7) hectares of it consist of "other
agricultural lands".

Clearly, then, the requisites for the grant of an application for exemption from coverage of OLT and those for the grant of
an application for the exercise of a landowner's right of retention, are different.

Hence, it is incorrect to posit that an application for exemption and an application for retention are one and the same
thing. Being distinct remedies, finality of judgment in one does not preclude the subsequent institution of the other.
 There was, thus, no procedural impediment to the application filed by Eudosia Daez for the retention of the subject
4.1865-hectare riceland, even after her appeal for exemption of the same land was denied in a decision that became final
and executory.

Second. Petitioner heirs of Eudosia Daez may exercise their right of retention over the subject 4.1685 riceland. yes

The right of retention is a constitutionally guaranteed right, which is subject to qualification by the legislature 21. 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.

In the landmark case of Association of Small Landowners in the Phil., Inc.  v. Secretary of Agrarian Reform23, we held that
landowners who have not yet exercised their retention rights under P.D. No. 27 are entitled to the new retention rights
under R.A. No. 665724.

Without doubt, this right of retention may be exercised over tenanted land despite even the issuance of Certificate of Land
Transfer (CLT) to farmer-beneficiaries.28 What must be protected, however, is the right of the tenants to opt to either stay
on the land chosen to be retained by the landowner or be a beneficiary in another agricultural land with similar or
comparable features.29

Finally. Land awards made pursuant to the government's agrarian reform program are subject to the exercise by a
landowner, who is so qualified, of his right of retention. yes

The issuance of EPs or CLOAs to beneficiaries does not absolutely bar the landowner from retaining the area covered
thereby. Under Administrative Order No. 2, series of 1994 32, an EP or CLOA may be cancelled if the land covered is later
found to be part of the landowner's retained area.

A certificate of title accumulates in one document a comprehensive statement of the status of the fee held by the owner of
a parcel of land.33 As such, it is a mere evidence of ownership and it does not constitute the title to the land itself. It cannot
confer title where no title has been acquired by any of the means provided by law 34.

In the instant case, the CLTs of private respondents over the subject 4.1685-hectare riceland were issued without Eudosia
Daez having been accorded her right of choice as to what to retain among her landholdings. The transfer certificates of title
thus issued on the basis of those CLTs cannot operate to defeat the right of the heirs of deceased Eudosia Daez to retain
the said 4.1685 hectares of riceland.

HELD:

 The instant petition is hereby GRANTED.

 The Decision of the Court of Appeals is REVERSED and SET ASIDE and the Decision of the Office of the President,
dated July 5, 1996, is hereby REINSTATED.

 In the implementation of said decision, however, the Department of Agrarian Reform is hereby ORDERED to fully
accord to private respondents their rights under Section 6 of R.A. No. 6657.