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Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No.

L-50444 August 31, 1987 ANTIPOLO REALTY CORPORATION, petitioner, vs. THE NATIONAL HOUSING AUTHORITY, HON. G.V. TOBIAS, in his capacity as General Manager of the National Housing Authority, THE HON. JACOBO C. CLAVE, in his capacity as Presidential Executive Assistant and VIRGILIO A. YUSON, respondents.

FELICIANO, J.: By virtue of a Contract to Sell dated 18 August 1970, Jose Hernando acquired prospective and beneficial ownership over Lot. No. 15, Block IV of the Ponderosa Heights Subdivision in Antipolo, Rizal, from the petitioner Antipolo Realty Corporation. On 28 August 1974, Mr. Hernando transferred his rights over Lot No. 15 to private respondent Virgilio Yuson. The transfer was embodied in a Deed of Assignment and Substitution of Obligor (Delegacion), executed with the consent of Antipolo Realty, in which Mr. Yuson assumed the performance of the vendee's obligations under the original contract, including payment of his predecessor's installments in arrears. However, for failure of Antipolo Realty to develop the subdivision project in accordance with its undertaking under Clause 17 of the Contract to Sell, Mr. Yuson paid only the arrearages pertaining to the period up to, and including, the month of August 1972 and stopped all monthly installment payments falling due thereafter Clause 17 reads: Clause 17. SUBDIVISION BEAUTIFICATION. To insure the beauty of the subdivision in line with the modern trend of urban development, the SELLER hereby obligates itself to provide the subdivision with: a) Concrete curbs and gutters b) Underground drainage system c) Asphalt paved roads d) Independent water system e) Electrical installation with concrete posts. f) Landscaping and concrete sidewall g) Developed park or amphi-theatre

h) 24-hour security guard service. These improvements shall be complete within a period of two (2) years from date of this contract. Failure by the SELLER shall permit the BUYER to suspend his monthly installments without any penalties or interest charges until such time that such improvements shall have been completed. 1 On 14 October 1976, the president of Antipolo Realty sent a notice to private respondent Yuson advising that the required improvements in the subdivision had already been completed, and requesting resumption of payment of the monthly installments on Lot No. 15. For his part, Mr. Yuson replied that he would conform with the request as soon as he was able to verify the truth of the representation in the notice. In a second letter dated 27 November 1976, Antipolo Realty reiterated its request that Mr. Yuson resume payment of his monthly installments, citing the decision rendered by the National Housing Authority (NHA) on 25 October 1976 in Case No. 252 (entitled "Jose B. Viado Jr., complainant vs. Conrado S. Reyes, respondent") declaring Antipolo Realty to have "substantially complied with its commitment to the lot buyers pursuant to the Contract to Sell executed by and between the lot buyers and the respondent." In addition, a formal demand was made for full and immediate payment of the amount of P16,994.73, representing installments which, Antipolo Realty alleged, had accrued during the period while the improvements were being completed i.e., between September 1972 and October 1976. Mr. Yuson refused to pay the September 1972-October 1976 monthly installments but agreed to pay the post October 1976 installments. Antipolo Realty responded by rescinding the Contract to Sell, and claiming the forfeiture of all installment payments previously made by Mr. Yuson. Aggrieved by the rescission of the Contract to Sell, Mr. Yuson brought his dispute with Antipolo Realty before public respondent NHA through a letter-complaint dated 10 May 1977 which complaint was docketed in NHA as Case No. 2123. Antipolo Realty filed a Motion to Dismiss which was heard on 2 September 1977. Antipolo Realty, without presenting any evidence, moved for the consolidation of Case No. 2123 with several other cases filed against it by other subdivision lot buyers, then pending before the NHA. In an Order issued on 7 February 1978, the NHA denied the motion to dismiss and scheduled Case No. 2123 for hearing. After hearing, the NHA rendered a decision on 9 March 1978 ordering the reinstatement of the Contract to Sell under the following conditions: l) Antipolo Realty Corporation shall sent [sic] to Virgilio Yuzon a statement of account for the monthly amortizations from November 1976 to the present; m) No penalty interest shall be charged for the period from November 1976 to the date of the statement of account; and n) Virgilio Yuzon shall be given sixty (60) days to pay the arrears shown in the statement of account. 2

Antipolo Realty filed a Motion for Reconsideration asserting: (a) that it had been denied due process of law since it had not been served with notice of the scheduled hearing; and (b) that the jurisdiction to hear and decide Mr. Yuson's complaint was lodged in the regular courts, not in the NHA, since that complaint involved the interpretation and application of the Contract to Sell. The motion for reconsideration was denied on 28 June 1978 by respondent NHA General Manager G.V. Tobias, who sustained the jurisdiction of the NHA to hear and decide the Yuson complaint. He also found that Antipolo Realty had in fact been served with notice of the date of the hearing, but that its counsel had failed to attend the hearing. 3 The case was submitted for decision, and eventually decided, solely on the evidence presented by the complainant. On 2 October 1978, Antipolo Realty came to this Court with a Petition for certiorari and Prohibition with Writ of Preliminary Injunction, which was docketed as G.R. No. L-49051. Once more, the jurisdiction of the NHA was assailed. Petitioner further asserted that, under Clause 7 of the Contract to Sell, it could validly terminate its agreement with Mr. Yuson and, as a consequence thereof, retain all the prior installment payments made by the latter. 4 This Court denied certiorari in a minute resolution issued on 11 December 1978, "without prejudice to petitioner's pursuing the administrative remedy." 5 A motion for reconsideration was denied on 29 January 1979. Thereafter, petitioner interposed an appeal from the NHA decision with the Office of the President which, on 9 March 1979, dismissed the same through public respondent Presidential Executive Assistant Jacobo C. Clave. 6 In the present petition, Antipolo Realty again asserts that, in hearing the complaint of private respondent Yuson and in ordering the reinstatement of the Contract to Sell between the parties, the NHA had not only acted on a matter beyond its competence, but had also, in effect, assumed the performance of judicial or quasi-judicial functions which the NHA was not authorized to perform. We find the petitioner's arguments lacking in merit. It is by now commonplace learning that many administrative agencies exercise and perform adjudicatory powers and functions, though to a limited extent only. Limited delegation of judicial or quasi-judicial authority to administrative agencies (e.g., the Securities and Exchange Commission and the National Labor Relations Commission) is well recognized in our jurisdiction, 7 basically because the need for special competence and experience has been recognized as essential in the resolution of questions of complex or specialized character and because of a companion recognition that the dockets of our regular courts have remained crowded and clogged. In Spouses Jose Abejo and Aurora Abejo, et al. vs. Hon. Rafael dela Cruz, etc., et al., 8 the Court, through Mr. Chief Justice Teehankee, said: In the fifties, the Court taking cognizance of the move to vest jurisdiction in administrative commissions and boards the power to resolve specialized disputes in the field of labor (as in corporations, public transportation and public utilities) ruled that Congress in requiring the Industrial Court's intervention in the resolution of labor management controversies likely to cause strikes or lockouts meant such jurisdiction to be exclusive, although it did not so expressly state in the law. The Court held that under the "sense-making and expeditious doctrine of

primary jurisdiction . . . the courts cannot or will not determine a controversy involving a question which is within the jurisdiction of an administrative tribunal where the question demands the exercise of sound administrative discretion requiring the special knowledge, experience, and services of the administrative tribunal to determine technical and intricate matters of fact, and a uniformity of ruling is essential to comply with the purposes of the regulatory statute administered" (Pambujan Sur United Mine Workers v. Samar Mining Co., Inc., 94 Phil, 932, 941 [1954]). In this era of clogged court dockets, the need for specialized administrative boards or commissions with the special knowledge, experience and capability to hear and determine promptly disputes on technical matters or essentially factual matters, subject to judicial review in case of grave abuse of discretion has become well nigh indispensable. Thus, in 1984, the Court noted that 'between the power lodged in an administrative body and a court, the unmistakeable trend has been to refer it to the former, "Increasingly, this Court has been committed to the view that unless the law speaks clearly and unequivocably, the choice should fall on fan administrative agency]" ' (NFL v. Eisma, 127 SCRA 419, 428, citing precedents). The Court in the earlier case of Ebon vs. De Guzman (113 SCRA 52, 56 [1982]), noted that the lawmaking authority, in restoring to the labor arbiters and the NLRC their jurisdiction to award all kinds of damages in labor cases, as against the previous P.D. amendment splitting their jurisdiction with the regular courts, "evidently, . . . had second thoughts about depriving the Labor Arbiters and the NLRC of the jurisdiction to award damages in labor cases because that setup would mean duplicity of suits, splitting the cause of action and possible conflicting findings and conclusions by two tribunals on one and the same claim." In an even more recent case, Tropical Homes, Inc. vs. National Housing Authority, et al., 9 Mr. Justice Gutierrez, speaking for the Court, observed that: There is no question that a statute may vest exclusive original jurisdiction in an administrative agency over certain disputes and controversies falling within the agency's special expertise. The very definition of an administrative agency includes its being vested with quasi-judicial powers. The ever increasing variety of powers and functions given to administrative agencies recognizes the need for the active intervention of administrative agencies in matters calling for technical knowledge and speed in countless controversies which cannot possibly be handled by regular courts. In general the quantum of judicial or quasi-judicial powers which an administrative agency may exercise is defined in the enabling act of such agency. In other words, the extent to which an administrative entity may exercise such powers depends largely, if not wholly, on the provisions of the statute creating or empowering such agency. 10 In the exercise of such powers, the agency concerned must commonly interpret and apply contracts and determine the rights of private parties under such contracts. One thrust of the multiplication of administrative agencies is that the interpretation of contracts and the determination of private rights thereunder is no longer a uniquely judicial function, exercisable only by our regular courts.

Thus, the extent to which the NHA has been vested with quasi-judicial authority must be determined by referring to the terms of Presidential Decree No. 957, known as "The Subdivision and Condominium Buyers' Decree." 11Section 3 of this statute provides as follows: National Housing Authority. The National Housing Authority shall have exclusive jurisdiction to regulate the real estate trade and business in accordance with the provisions of this decree (emphasis supplied) The need for and therefore the scope of the regulatory authority thus lodged in the NHA are indicated in the second and third preambular paragraphs of the statute which provide: WHEREAS, numerous reports reveal that many real estate subdivision owners, developers, operators, and/or sellers have reneged on their representations and obligations to provide and maintain properly subdivision roads, drainage, sewerage, water systems lighting systems and other similar basic requirements, thus endangering the health and safety of home and lot buyers; WHEREAS, reports of alarming magnitude also show cases of swindling and fraudulent manipulations perpetrated by unscrupulous subdivision and condominium sellers and operators, such as failure to deliver titles to the buyers or titles free from liens and encumbrances, and to pay real estate taxes, and fraudulent sales of the same subdivision lots to different innocent purchasers for value . (emphasis supplied) Presidential Decree No. 1344 12 clarified and spelled out the quasi-judicial dimensions of the grant of regulatory authority to the NHA in the following quite specific terms: SECTION 1. In the exercise of its functions to regulate the real estate trade and business and in addition to its powers provided for in Presidential Decree No. 957, the National Housing Authority shall have exclusive jurisdiction to hear and decide cases of the following nature: A. Unsound real estate business practices: B. Claims involving refund and any other claims filed by sub- division lot or condominium unit buyer against the project owner, developer, dealer, broker or salesman; and C. Cases involving specific performance of contractual and statutory obligations filed by buyers of subdivision lots or condominium units against the owner, developer, dealer, broker or salesman.(emphasis supplied.) The substantive provisions being applied and enforced by the NHA in the instant case are found in Section 23 of Presidential Decree No. 957 which reads: Sec. 23. Non-Forfeiture of Payments. No installment payment made by a buyer in a subdivision or condominium project for the lot or unit he contracted to buy shall be forfeited in favor of the owner or developer when the buyer, after due notice to the owner or developer, desists from further payment due to the failure of the owner or developer to develop the subdivision or condominium

project according to the approved plans and within the time limit for complying with the same. Such buyer may, at his option, be reimbursed the total amount paid including amortization and interests but excluding delinquency interests, with interest thereon at the legal rate. (emphasis supplied.) Having failed to comply with its contractual obligation to complete certain specified improvements in the subdivision within the specified period of two years from the date of the execution of the Contract to Sell, petitioner was not entitled to exercise its options under Clause 7 of the Contract. Hence, petitioner could neither rescind the Contract to Sell nor treat the installment payments made by the private respondent as forfeited in its favor. Indeed, under the general Civil Law, 13 in view of petitioner's breach of its contract with private respondent, it is the latter who is vested with the option either to rescind the contract and receive reimbursement of an installment payments (with legal interest) made for the purchase of the subdivision lot in question, or to suspend payment of further purchase installments until such time as the petitioner had fulfilled its obligations to the buyer. The NHA was therefore correct in holding that private respondent's prior installment payments could not be forfeited in favor of petitioner. Neither did the NHA commit any abuse, let alone a grave abuse of discretion or act in excess of its jurisdiction when it ordered the reinstatement of the Contract to Sell between the parties. Such reinstatement is no more than a logical consequence of the NHA's correct ruling, just noted, that the petitioner was not entitled to rescind the Contract to Sell. There is, in any case, no question that under Presidential Decree No. 957, the NHA was legally empowered to determine and protect the rights of contracting parties under the law administered by it and under the respective agreements, as well as to ensure that their obligations thereunder are faithfully performed. We turn to petitioner's assertion that it had been denied the right to due process. This assertion lacks substance. The record shows that a copy of the order denying the Motion to Dismiss and scheduling the hearing of the complaint for the morning of 6 March 1978, was duly served on counsel for petitioner, as evidenced by the annotation appearing at the bottom of said copy indicating that such service had been effected. 14 But even if it be assumed, arguendo, that such notice had not been served on the petitioner, nevertheless the latter was not deprived of due process, for what the fundamental law abhors is not the absence of previous notice but rather the absolute lack of opportunity to be heard. 15 In the instant case, petitioner was given ample opportunity to present its side and to be heard on a motion for reconsideration as well, and not just on a motion to dismiss; the claim of denial of due process must hence sound even more hollow. 16 We turn finally to the question of the amount of P16,994.73 which petitioner insists had accrued during the period from September 1972 to October 1976, when private respondent had suspended payment of his monthly installments on his chosen subdivision lot. The NHA in its 9 March 1978 resolution ruled that the regular monthly installments under the Contract to Sell did not accrue during the September 1972 October 1976 period: [R]espondent allowed the complainant to suspend payment of his monthly installments until the improvements in the subdivision shall have been completed. Respondent informed complainant on November 1976 that the improvements have been completed. Monthly installments during the period of suspension of payment did not become due and demandable Neither did they accrue Such must be the case, otherwise, there is no sense in suspending

payments. If the suspension is lifted the debtor shall resume payments but never did he incur any arrears. Such being the case, the demand of respondent for complainant to pay the arrears due during the period of suspension of payment is null and void. Consequently, the notice of cancellation based on the refusal to pay the s that were not due and demandable is also null and void. 17 The NHA resolution is probably too terse and in need of certification and amplification. The NHA correctly held that no installment payments should be considered as having accrued during the period of suspension of payments. Clearly, the critical issue is what happens to the installment payments which would have accrued and fallen due during the period of suspension had no default on the part of the petitioner intervened. To our mind, the NHA resolution is most appropriately read as directing that the original period of payment in the Contract to Sell must be deemed extended by a period of time equal to the period of suspension (i.e., by four (4) years and two (2) months) during which extended time (tacked on to the original contract period) private respondent buyer must continue to pay the monthly installment payments until the entire original contract price shall have been paid. We think that such is the intent of the NHA resolution which directed that "[i]f the suspension is lifted, the debtor shall resume payments" and that such is the most equitable and just reading that may be given to the NHA resolution. To permit Antipolo Realty to collect the disputed amount in a lump sum after it had defaulted on its obligations to its lot buyers, would tend to defeat the purpose of the authorization (under Sec. 23 of Presidential Decree No. 957,supra) to lot buyers to suspend installment payments. As the NHA resolution pointed out, [s]uch must be the case, otherwise, there is no sense in suspending payments." Upon the other hand, to condone the entire amount that would have become due would be an expressively harsh penalty upon the petitioner and would result in the unjust enrichment of the private respondent at the expense of the petitioner. It should be recalled that the latter had already fulfilled, albeit tardily, its obligations to its lot buyers under their Contracts to Sell. At the same time, the lot buyer should not be regarded as delinquent and as such charged penalty interest. The suspension of installment payments was attributable to the petitioner, not the private respondent. The tacking on of the period of suspension to the end of the original period precisely prevents default on the part of the lot buyer. In the words of the NHA resolution, "never would [the buyer] incur any arrears." WHEREFORE, the Petition for certiorari is DISMISSED. The NHA decision appealed from is hereby AFFIRMED and clarified as providing for the lengthening of the original contract period for payment of installments under the Contract to Sell by four (4) years and two (2) months, during which extended time private respondent shall continue to pay the regular monthly installment payments until the entire original contract price shall have been paid. No pronouncement as to costs. SO ORDERED. Teehankee, C.J., Yap, Fernan, Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Gancayco, Padilla, Bidin, Sarmiento and Cortes, JJ., concur.

Footnotes

1 Rollo, pp. 26-29, Annex "D" of Petition. 2 Rollo, p. 20, Annex "A" of Petition. 3 Ibid, pp. 21-22, Annex "B" of Petition. 4 Clause 7 provides: "In case the BUYER fails to satisfy any monthly installments, or any other payments herein agreed upon, he is granted a month of grace within which to make the retarded payment, it is understood, however, that should the month of grace herein granted to the BUYER expire, without the payments corresponding to both months having been satisfied, an interest of 12% per annum will be charged on the amounts he should have paid; it is understood further, that should a period of 60 days elapse, to begin from the expiration of the month of grace herein mentioned, and the BUYER has not paid all the amounts he should have paid, with the corresponding interest, up to that date, the SELLER has the right to declare this contract cancelled, ex parte, and of no effect, and as consequence thereof, the SELLER may dispose of the parcel or parcels of land covered by this contract, without notice to the BUYER, in favor of other persons, as if this contract had never been entered into. In case of such cancellation of this contract, all the amounts paid in accordance with this agreement, together with all the improvements made on the premises, shall be considered as rents and charges paid for the use and occupation of the abovementioned premises, and as payment for the damages suffered by failure of the BUYER to fulfill his part of this agreement, and the BUYER hereby renounces all his right to demand or reclaim the return of the same and obliges himself to peacefully and immediately vacate the premises and deliver the same to the SELLER without delay. 5 Rollo of G.R. No. 49051, p. 63. 6 Rollo, pp. 23-25, Annex "C" of Petition. 7 See, e.g., National Federation of Labor v. Eisma, 127 SCRA 419 (1984) and Philex Mining Corporation v. Reyes, 118 SCRA 602 (1982). 8 G.R. No. L-63558, promulgated 19 May 1987; underscoring supplied. 9 G.R. No. L-48672, promulgated 31 July 1987; underscoring supplied. 10 See, in this connection, DMRC Enterprises v. Este del Sol Mountain Reserve, Inc., 132 SCRA 293 (1984); Union Glass and Container Corporation v. Securities and Exchange Commission, 126 SCRA 31 (1983); and Philex Mining Corporation v. Reyes, supra. 11 Promulgated on 12 July 1976. 12 Promulgated on 2 April 1978. 13 Articles 1191 and 1169, Civil Code.

14 Rollo of G.R. No. 49051, p. 58; Annex "A" of Comment. 15 Manuel v. Villena, 37 SCRA 745 (1971) and Asprec v. Itchon, 16 SCRA 921 (1966). 16 See, BLTB Co. v. Cadiao, 22 SCRA 987 (1968). 17 Rollo, p. 20; underscoring supplied.

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION

A.C. No. 4634 September 24, 1997 JESUS CABARRUS, JR., complainant, vs. JOSE ANTONIO S. BERNAS, respondent.

TORRES, JR., J.: On August 30, 1996, Mr. Jesus Cabarrus, Jr. filed an administrative complaint for disbarment against Atty. Jose Antonio Bernas for alleged violations of Article 172 of the Revised Penal Code and Code of Professional Responsibility. In his complaint-affidavit 1 dated August 12, 1996, complainant alleged as follows: A. That on April 16, 1996, respondent Ramon B. Pascual, Jr., subscribed under oath before Marie Lourdes T. Sia Bernas, a notary public in Makati City, wife of lawyer Jose Antonio Bernas, a verification and certification of non-forum shopping which was appended to a complaint for reconveyance of property and damages, denominated as Civil Case No. 65646, filed before the Regional Trial Court in National Capital Region, RTC, which case was raffled to RTC Branch 159 in Pasig City. A photocopy of said complaint is hereto attached and marked as Annexex (sic) A, A-1, A-3, A-4, A-5 and A-6; B. That as basis for the instant complaint for falsification of public document, I am hereto quoting verbatim, the test (sic) of Annex A-6, the verification and certification of non-forum shopping which states: Ramon B. Pascual, Jr., under oath, depose and states: He is the plaintiff in this case, and certify that he cause the preparation of the foregoing pleading, the content of which are true to his personal knowledge and that he has not commenced any other action or proceeding involving the same issues in any court, including the Supreme Court, the Court of Appeals, or any other tribunal or agency. If he should learn that a similar action of (sic) proceeding has been filed or is pending before the Supreme Court or any other Tribunal agency, he undertake to report to (sic) that fact within Five (5) days from notice to this notice (sic) to this Honorable Court. Emphasis supplied. C. That the cause of action relied upon by the respondent in Civil Case No. 65646 is fraud, facilitated by forgery as gleaned from paragraphs 15, 16, and 22;

D. That contrary to the tenor, import and meanoing (sic) of the allegation under 1B of the instant complaint, respondent and his counsel Jose Antonio Bernas caused the preparation and filing of a criminal complaint for falsification of a public document on April 11, 1996, (three days before the filing of the aforecited Civil Case) at the AOED of the National Bureau of Investigation if (sic) Taff (sic) Ave., a xerox copy of said complaint is hereto attached and marked as Annex "B". D-1. That as stated in Annex "B", the gravaman of the affidavit complaint of the respondent is forgery, the same legal issue in Civil Case No. 65646; D-2. That as early as August 14, 1995, respondent counsel, Jose Antonio Bernas filed a written complaint at the NBI for the same cause of action which was reiterated in another letter submitting to the NBI standard specimen signatures dated October 1995, copies of said letter complaint are hereto attached and marked as Annexes (sic) "C". E. That respondent Ramon B. Pascual, Jr., on the basis of Annexes A, B, C, D, inclusive of submarkings knowingly subverted and perverted the truth when he falsify certified (sic) and verified under oath in the verification and certification of non-forum shopping, that: He has not commenced any other action or proceeding involving the same issues in any court, including the Supreme Court, the Court of Appeals, or any other Tribunal or agency." Where verification-certification was placed under oath and was conveniently notarized by the wife of the counsel of respondent in both cases at Branch 159 of the RTC in Pasig and at the NBI, an agency within the ambis (sic) and purview of the circulus (sic) of the Supreme Court prohibiting forum shopping. F. That Jose Antonio Bernas, the counsel on record of the respondents in Civil Case No. 65646 is the same lawyer who instigated a criminal complaint at the NBI for forgery and respondents themselves conspired and confabulated with each other in facilitating and insuring the open, blatant and deliberate violation of Art. 172 of the Revised Penal Code which states: Art. 172. Falsification by private individual and use of falsified documents. The penalty of prision correccional in its medium and maximum periods and a fine of not more than P5,000 pesos shall be imposed upon: 1. Any private individual who shall commit any of the falsifications enumerated in the next preceding article in any public or official document or letter of exchanged (sic) or any other kind of commercial document; and 2. Any person who, to the damage of a third party, or with the intent to cause such damage, shall in any private document

commit any of the acts of falsification enumerated in the next preceding article. Any person who shall knowingly introduce in evidence in any judicial proceeding or to the damage of another or who, with the intent to cause such damage, shall use any of the false documents embraced in the next preceding article, or in any of the foregoing subdivisions of this article, shall be punished by the penalty next lower in degree. G. That Atty. Jose Antonio Bernas should be disbarred for having instigated, abetted and facilitated the perversion and subversion of truth in the said verification and certification of non-forum shopping. Contrary to Canon 1, Rule 1.01, 1.02, Canon 3, 3.01, Canon 10 of the Code of Professional Responsibility for Lawyers, the pertinent provisions of which are herein below quoted and a copy of said code is hereto attached and marked as Annex "E"; CANON 1. A. LAWYER SHALL UPHOLD THE CONSTITUTION, OBEY THE LAWS OF THE LAND PROMOTE RESPECT FOR LAW AND LEGAL PROCESSES. Rule 1.01 A lawyer shall not engage in unlawful, dishonest, immoral or decietful (sic) conduct. Rule 1.02 A lawyer shall not counsel or abet activities simed (sic) at defiance of the law or at lessening confidence in the legal system. CANON 3. A. LAWYER IN MAKING KNOWN HIS LEGAL SERVICES SHALL USE ONLY TRUE, HONEST, FAIR, DIGNIFIED AND OBJECTIVE INFORMATION OF (sic) STATEMENT OF FACTS. Rule 3.01 A lawyer shall not use or permit the use of any false, fraudulent, misleading, deceptive, undignified, self-laudatory or unfair statement or claim regarding his qualified (sic) or legal services. CANON 10. A LAWYER OWES CANDOR, FAIRNESS AND GOOD FAITH TO THE COURT. In his Comment, 2 respondent Jose Antonio Bernas avers that he has not committed forum shopping because the criminal action is not an action that involves the same issue as those in a civil action and both suits can exist without constituting forum shopping so long as the civil aspect has not been prosecuted in the criminal case. He emphasized that forum shopping only exists when identical reliefs are issued by the same parties in multiple fora. In his Supplemental Comment, 3 respondent further contends that neither he or his client Pascual has commenced any criminal action. Pascual merely requested the NBI to assist in the investigation or prosecution, and left it to the NBI to determine whether the filing of an

endorsement to the prosecutor, who would determine probable cause, would be appropriate. It was only upon request of the NBI that he assisted Ramon Pascual in drafting an affidavitcomplaint for falsification of public documents against complainant. Likewise, respondent by counsel reiterates that the letter transmitted to the NBI cannot constitute an action or proceeding because the NBI's functions are merely investigatory and informational in nature. NBI has no prosecutorial functions or quasi-judical powers and is incapable of granting relief or remedy. The NBI cannot be an agency contemplated by the circular. The core issue to be resolved here is whether respondent Atty. Bernas transgressed Circular No. 28-91, Revised Circular No. 28-91, and Administrative Circular No. 04 - 94 on forum shopping. After a careful scrutiny of the records, we find the administrative complaint bereft of merit and should be dismissed. There is forum-shopping whenever, as a result of an adverse opinion in one forum, a party seeks a favorable opinion (other than by appeal or certiorari) in another. Therefore, a party to a case resorts to forum shopping because "by filing another petition involving the same essential facts and circumstances, . . . , respondents approached two different fora in order to increase their chances of obtaining a favorable decision or action. 4 In this case, there is no forum shopping to speak of. Atty. Bernas, as counsel of Mr. Pascual, Jr., merely requested the assistance of the NBI to investigate the alleged fraud and forgery committed by Mr. Jesus Cabarrus. 5 The filing of a civil case for reconveyance and damages before the Regional Trial Court of Pasig City does not preclude respondent to institute a criminal action. The rule allows the filing of a civil case independently with the criminal case without violating the circulars on forum shopping. It is scarcely necessary to add that Circular No. 28-91 must be so interpreted and applied as to achieve the purposes projected by the Supreme Court when it promulgated that Circular. Circular No. 28-91 was designed to serve as an instrument to promote and facilitate the orderly administration of justice and should not be interpreted with such absolute literalness as to subvert its own ultimate and legitimate objective or the goal of all rules of procedure which is to achieve substantial justice as expeditiously as possible. 6 Adjunct to this, Act No. 157 7, specifically section 1 hereof provides, viz: Sec. 1. There is hereby created a Bureau of Investigation under the Department of Justice which shall have the following functions: (a) To undertake investigation of crimes and other offenses against the laws of the Philippines, upon its initiative and as public interest may require; (b) To render assistance, whenever properly requested in the investigation or detection of crimes and other offenses; (c) To act as a national clearing house of criminal and other informations for the benefit and use of all prosecuting and law-enforcement entities of the Philippines, identification records of all persons without criminal convictions, records of identifying marks, characteristics, and ownership or possession of all firearms as well as of test bullets fired therefrom;

(d) To give technical aid to all prosecuting and law-enforcement officers and entities of the Government as well as the courts that may request its services; (e) To extend its services, whenever properly requested in the investigation of cases of administrative or civil nature in which the Government is interested; (f) To undertake the instruction and training of representative number of city and municipal peace officers at the request of their respective superiors along effective methods of crime investigation and detection in order to insure greater efficiency in the discharge of their duties; (g) To establish and maintain an up-to-date scientific crime laboratory and to conduct researches in furtherance of scientific knowledge in criminal investigation; (h) To perform such other related functions as the Secretary of Justice may assign from time to time. Explicitly, the functions of the National Bureau of Investigations are merely investigatory and informational in nature. It has no judicial or quasi-judicial powers and is incapable of granting any relief to a party. It cannot even determine probable cause. It is an investigative agency whose findings are merely recommendatory. It undertakes investigation of crimes upon its own initiative and as public welfare may require. It renders assistance when requested in the investigation or detection of crimes which precisely what Atty. Bernas sought in order to prosecute those persons responsible for defrauding his client. The courts, tribunals and agencies referred to under Circular No. 28-91, Revised Circular No. 28-91 and Administrative Circular No. 04-94 are those vested with judicial powers or quasijudicial powers and those who not only hear and determine controversies between adverse parties, but to make binding orders or judgments. As succinctly put it by R.A. 157, the NBI is not performing judicial or quasi-judicial functions. The NBI cannot therefore be among those forums contemplated by the Circular that can entertain an action or proceeding, or even grant any relief, declaratory or otherwise. WHEREFORE, premises considered, the instant complaint is hereby DISMISSED. SO ORDERED. Regalado and Puno, JJ., concur. Mendoza, J., is on leave.

Republic of the Philippines SUPREME COURT Manila THIRD DIVISION G.R. No. 161811 April 12, 2006

THE CITY OF BAGUIO, MAURICIO DOMOGAN, and ORLANDO GENOVE, Petitioners, vs. FRANCISCO NIO, JOSEFINA NIO, EMMANUEL NIO, and EURLIE OCAMPO, Respondents. DECISION CARPIO MORALES, J.: The Bureau of Lands awarded on May 13, 1966 to Narcisa A. Placino (Narcisa) a parcel of land identified as Lot No. 10 (the lot) located at Saint Anthony Road, Dominican-Mirador Barangay, Baguio City. Francisco Nio (Nio), one of the herein respondents, who has been occupying the lot, contested the award by filing a Petition Protest on December 23, 1975 before the Bureau of Lands. The Director of Lands dismissed the Petition Protest by Order of November 11, 1976. Nio appealed the dismissal all the way to the Supreme Court but he did not succeed. The decision of the Director of Lands dated November 11, 1976 having become final and executory,1 the then-Executive Director of the Department of Environment and Natural Resources-Cordillera Autonomous Region (DENR-CAR), on petition of Narcisa, issued an Order of Execution dated February 1, 1993 directing the Community Environment and Natural Resources Office (CENRO) Officer to enforce the decision "by ordering Petitioner Nio and those acting in his behalf to refrain from continuously occupying the area and remove whatever improvements they may have introduced thereto."2 Attempts to enforce the Order of Execution failed, prompting Narcisa to file a complaint for ejectment before the Baguio City Municipal Trial Court in Cities (MTCC). The MTCC dismissed Narcisas complaint, however, by Order3of August 7, 1996. Narcisas counsel, Atty. Edilberto Claravall (Atty. Claravall), later petitioned the DENR-CAR for the issuance of a Special Order authorizing the City Sheriff of Baguio, the City Police Station, and the Demolition Team of the City Government to demolish or remove the improvements on the lot introduced by Nio. The DENR-CAR denied the petition, citing lack of jurisdiction over the City Sheriff of Baguio, the City Police Station, and the Demolition Team of the City Government. The DENR-CAR also invoked Section 14 (now Section 10 (d)) of Rule 39 of the Rules of Court.4

Atty. Claravall thereupon moved to have the Order of Execution previously issued by the DENRCAR amended, which was granted. As amended, the Order of Execution addressed to the CENRO Officer read: WHEREFORE, pursuant to the provisions of Section 1844 of the Revised Administrative Code as amended by Act No. 3077, you are hereby enjoined to enforce the aforementioned order, with the assistance upon request of the City Sheriff of Baguio City, the Demolition Team of Baguio City and the Baguio City Police Station, by Ordering Petitioner Nio and those acting in his behalf to refrain from continuously occupying the area and remove whatever improvements they may have introduced thereto. xxxx SO ORDERED.5 (Emphasis and underscoring supplied) The DENR-CENRO, together with the Demolition Team of Baguio City and the Baguio City police, desisted, however, in their earlier attempt to enforce the Amended Order of Execution. 6 On July 16, 1997, the Demolition Team of Baguio City headed by Engineer Orlando Genove and the Baguio City Police, on orders of then Baguio City Police Officer-In-Charge (OIC) Donato Bacquian, started demolishing the houses of Nio and his herein co-respondents.7 The demolition was, however, temporarily stopped upon the instructions of DENR-CENR Officer Guillermo Fianza, who later advised Nio that the DENR-CENRO would implement the Amended Order of Execution on August 4, 1997.8 Nio and his wife Josefina Nio thereupon filed a Petition9 for Certiorari and Prohibition with Prayer for Temporary Restraining Order before the Regional Trial Court (RTC) of Baguio City against Guillermo Fianza, Teofilo Olimpo of the DENR-CENRO, Mayor Mauricio Domogan (hereafter petitioner), Atty. Claravall, Engr. Orlando Genove (hereafter petitioner), Rolando Angara, and Police Officer Donato Bacquian challenging the Amended Order of Execution issued by the DENR-CENRO.1avvphil.net The Nio spouses later filed an Amended Petition10 by impleading Emmanuel Nio and Eurlie Ocampo as therein co-petitioners and the City of Baguio (hereafter petitioner) and Narcisa as therein additional respondents, and further praying for damages. Branch 6 of the Baguio RTC dismissed the petition of Nio et al. (hereafter respondents) for lack of merit.11Respondents Motion for Reconsideration12 having been denied, they filed a Petition for Review13 under Rule 42 of the Rules before the Court of Appeals. By Decision14 of December 11, 2002, the Court of Appeals granted the Petition for Review, holding that Sec. 10(d) of Rule 39 of the Rules reading: SEC. 10. Execution of judgments for specific act. xxxx

(d) Removal of improvements on property subject of execution. When the property subject of the execution contains improvements constructed or planted by the judgment obligor or his agent, the officer shall not destroy, demolish or remove said improvements except upon special order of the court, issued upon motion of the judgment obligee after due hearing and after the former has failed to remove the same within a reasonable time fixed by the court. (Underscoring supplied) applies. Thus disposed the appellate court: WHEREFORE, the instant appeal is hereby GRANTED and the Orders dated September 24, 1997 and November 23, 1998 are hereby SET ASIDE. Public respondent City Mayor Mauricio Domogan thru the Demolition Team and City Engineers Office are hereby ordered to cease and desist from enforcing the amended order of executionissued by Oscar N. Hamada, Regional Executive Director of the Department of Environmental and Natural Resources, concerning the demolition or removal of the structures made by petitioners until private respondent applied for a special order abovementioned with the proper court.1avvphil.net SO ORDERED.15 (Underscoring supplied) Respondents filed before the appellate court an Ex-Parte Motion for Reconsideration16 on January 9, 2003, alleging that some of the reliefs they prayed for in their petition were left unacted upon.17 Petitioners too filed a Motion for Reconsideration18 on January 28, 2003, raising the following grounds: 1. THE HONORABLE COURT FAILED TO CONSIDER THAT THE CITY MAYOR HAS THE POWER TO ORDER THE DEMOLITION OF ILLEGALLY-BUILT STRUCTURES; 2. THE HONORABLE COURT GRAVELY ERRED IN GIVING DUE COURSE TO THE PETITION FOR REVIEW; 3. THE HONORABLE COURT MISAPPLIED SEC. 10 (d), RULE 39 of the RULES OF COURT.19(Underscoring supplied) In support of the first ground, petitioners raised before the appellate court, in their Motion for Reconsideration, for the first time, the power of the City Mayor to validly order the demolition of a structure constructed without a building permit pursuant to Sec. 455(b) 3(vi) of the Local Government Code of 1991 in relation to the National Building Code of the Philippines. Alleging that respondents built their house without the required entry and building permits, petitioners argued that the City Mayor may order the demolition of a house without a special court order.20 The Court of Appeals denied both parties motions for reconsideration by Resolution21 of December 17, 2003. Hence, the present petition of the City of Baguio, Mayor Domogan (now a Congressman), and Orlando Genove, faulting the appellate court:

1. . . . IN RULING THAT A SPECIAL COURT ORDER IS NEEDED FOR THE DEMOLITION OF RESPONDENTS STRUCTURES; 2. . . . IN APPLYING SEC. 10(d) RULE 39 OF THE RULES OF COURT IN THIS CASE; 3. . . . IN ENTERTAINING RESPONDENTS PETITION FOR REVIEW.22 The petition fails. While it is noted that respondents appeal to the Court of Appeals was erroneously brought under Rule 42 of the Rules of Court, instead of under Rule 41, the RTC having rendered the questioned decision in the exercise of its original, not appellate, jurisdiction, this Court overlooks the error in view of the merits of respondents case.23 Petitioners contention that the enforcement of the Amended Order of Execution does not need a hearing and court order which Sec. 10(d) of Rule 39 of the Rules of Court requires does not lie. That an administrative agency which is clothed with quasi-judicial functions issued the Amended Order of Execution is of no moment, since the requirement in Sec. 10 (d) of Rule 39 of the Rules of Court echoes the constitutional provision that "no person shall be deprived of life, liberty or property without due process of law, nor shall any person be denied the equal protection of the laws."24 Antipolo Realty Corporation v. National Housing Authority teaches: In general, the quantum of judicial or quasi-judicial powers which an administrative agency may exercise is defined in the enabling act of such agency. In other words, the extent to which an administrative entity may exercise such powers depends largely, if not wholly, on the provisions of the statute creating or empowering such agency.25(Underscoring supplied) There is, however, no explicit provision granting the Bureau of Lands (now the Land Management Bureau) or the DENR (which exercises control over the Land Management Bureau) the authority to issue an order of demolition26 which the Amended Order of Execution, in substance, is. Indeed, [w]hile the jurisdiction of the Bureau of Lands is confined to the determination of the respective rights of rival claimants to public lands or to cases which involve the disposition of public lands, the power to determine who has the actual, physical possession or occupation or the better right of possession over public lands remains with the courts. The rationale is evident. The Bureau of Lands does not have the wherewithal to police public lands. Neither does it have the means to prevent disorders or breaches of peace among the occupants. Its power is clearly limited to disposition and alienation and while it may decide disputes over possession, this is but in aid of making the proper awards. The ultimate power to resolve conflicts of possession is recognized to be within the legal competence of the civil courts and its purpose is to extend protection to the actual possessors and occupants with a view to quell social unrest.27 (Emphasis added)

Consequently, this Court held:28 x x x the power to order the sheriff to remove improvements and turn over the possession of the land to the party adjudged entitled thereto, belongs only to the courts of justice and not to the Bureau of Lands.29 (Emphasis and underscoring supplied) In fine, it is the court sheriff which is empowered to remove improvements introduced by respondents on, and turn over possession of, the lot to Narcisa. Petitioners invocation of the City Mayors authority under Sec. 455(b) 3(vi) of the Local Government Code to order the demolition or removal of an illegally constructed house, building, or structure within the period prescribed by law or ordinance and their allegation that respondents structures were constructed without building permits30were not raised before the trial court. Petitioners having, for the first time, invoked said section of the Local Government Code and respondents lack of building entry permits in their Motion for Reconsideration of the Court of Appeals decision, it was correctly denied of merit,31 it being settled that matters, theories or arguments not brought out in the proceedings below will ordinarily not be considered by a reviewing court as they cannot be raised for the first time on appeal.32 WHEREFORE, the petition is DISMISSED. The questioned Decision and Resolution of the Court of Appeals areAFFIRMED. No pronouncement as to costs. SO ORDERED. CONCHITA CARPIO MORALES Associate Justice

Republic of the Philippines SUPREME COURT EN BANC G.R. No. 162070 October 19, 2005 DEPARTMENT OF AGRARIAN REFORM, represented by SECRETARY JOSE MARI B. PONCE (OIC),Petitioner vs. DELIA T. SUTTON, ELLA T. SUTTON-SOLIMAN and HARRY T. SUTTON, Respondents. DECISION PUNO, J.: This is a petition for review filed by the Department of Agrarian Reform (DAR) of the Decision and Resolution of the Court of Appeals, dated September 19, 2003 and February 4, 2004, respectively, which declared DAR Administrative Order (A.O.) No. 9, series of 1993, null and void for being violative of the Constitution. The case at bar involves a land in Aroroy, Masbate, inherited by respondents which has been devoted exclusively to cow and calf breeding. On October 26, 1987, pursuant to the then existing agrarian reform program of the government, respondents made a voluntary offer to sell (VOS)1 their landholdings to petitioner DAR to avail of certain incentives under the law. On June 10, 1988, a new agrarian law, Republic Act (R.A.) No. 6657, also known as the Comprehensive Agrarian Reform Law (CARL) of 1988, took effect. It included in its coverage farms used for raising livestock, poultry and swine. On December 4, 1990, in an en banc decision in the case of Luz Farms v. Secretary of DAR,2 this Court ruled that lands devoted to livestock and poultry-raising are not included in the definition of agricultural land. Hence, we declared as unconstitutional certain provisions of the CARL insofar as they included livestock farms in the coverage of agrarian reform. In view of the Luz Farms ruling, respondents filed with petitioner DAR a formal request to withdraw their VOS as their landholding was devoted exclusively to cattle-raising and thus exempted from the coverage of the CARL.3 On December 21, 1992, the Municipal Agrarian Reform Officer of Aroroy, Masbate, inspected respondents land and found that it was devoted solely to cattle-raising and breeding. He recommended to the DAR Secretary that it be exempted from the coverage of the CARL. On April 27, 1993, respondents reiterated to petitioner DAR the withdrawal of their VOS and requested the return of the supporting papers they submitted in connection therewith.4 Petitioner ignored their request. On December 27, 1993, DAR issued A.O. No. 9, series of 1993,5 which provided that only portions of private agricultural lands used for the raising of livestock, poultry and swine as of

June 15, 1988 shall be excluded from the coverage of the CARL. In determining the area of land to be excluded, the A.O. fixed the following retention limits, viz: 1:1 animal-land ratio (i.e., 1 hectare of land per 1 head of animal shall be retained by the landowner), and a ratio of 1.7815 hectares for livestock infrastructure for every 21 heads of cattle shall likewise be excluded from the operations of the CARL. On February 4, 1994, respondents wrote the DAR Secretary and advised him to consider as final and irrevocable the withdrawal of their VOS as, under the Luz Farms doctrine, their entire landholding is exempted from the CARL.6 On September 14, 1995, then DAR Secretary Ernesto D. Garilao issued an Order7 partially granting the application of respondents for exemption from the coverage of CARL. Applying the retention limits outlined in the DAR A.O. No. 9, petitioner exempted 1,209 hectares of respondents land for grazing purposes, and a maximum of 102.5635 hectares for infrastructure. Petitioner ordered the rest of respondents landholding to be segregated and placed under Compulsory Acquisition. Respondents moved for reconsideration. They contend that their entire landholding should be exempted as it is devoted exclusively to cattle-raising. Their motion was denied.8 They filed a notice of appeal9 with the Office of the President assailing: (1) the reasonableness and validity of DAR A.O. No. 9, s. 1993, which provided for a ratio between land and livestock in determining the land area qualified for exclusion from the CARL, and (2) the constitutionality of DAR A.O. No. 9, s. 1993, in view of the Luz Farms case which declared cattle-raising lands excluded from the coverage of agrarian reform. On October 9, 2001, the Office of the President affirmed the impugned Order of petitioner DAR.10 It ruled that DAR A.O. No. 9, s. 1993, does not run counter to the Luz Farms case as the A.O. provided the guidelines to determine whether a certain parcel of land is being used for cattle-raising. However, the issue on the constitutionality of the assailed A.O. was left for the determination of the courts as the sole arbiters of such issue. On appeal, the Court of Appeals ruled in favor of the respondents. It declared DAR A.O. No. 9, s. 1993, void for being contrary to the intent of the 1987 Constitutional Commission to exclude livestock farms from the land reform program of the government. The dispositive portion reads: WHEREFORE, premises considered, DAR Administrative Order No. 09, Series of 1993 is hereby DECLARED null and void. The assailed order of the Office of the President dated 09 October 2001 in so far as it affirmed the Department of Agrarian Reforms ruling that petitioners landholding is covered by the agrarian reform program of the government is REVERSED and SET ASIDE. SO ORDERED.11 Hence, this petition. The main issue in the case at bar is the constitutionality of DAR A.O. No. 9, series of 1993, which prescribes a maximum retention limit for owners of lands devoted to livestock raising. Invoking its rule-making power under Section 49 of the CARL, petitioner submits that it issued DAR A.O. No. 9 to limit the area of livestock farm that may be retained by a landowner pursuant

to its mandate to place all public and private agricultural lands under the coverage of agrarian reform. Petitioner also contends that the A.O. seeks to remedy reports that some unscrupulous landowners have converted their agricultural farms to livestock farms in order to evade their coverage in the agrarian reform program. Petitioners arguments fail to impress. Administrative agencies are endowed with powers legislative in nature, i.e., the power to make rules and regulations. They have been granted by Congress with the authority to issue rules to regulate the implementation of a law entrusted to them. Delegated rule-making has become a practical necessity in modern governance due to the increasing complexity and variety of public functions. However, while administrative rules and regulations have the force and effect of law, they are not immune from judicial review.12 They may be properly challenged before the courts to ensure that they do not violate the Constitution and no grave abuse of administrative discretion is committed by the administrative body concerned. The fundamental rule in administrative law is that, to be valid, administrative rules and regulations must be issued by authority of a law and must not contravene the provisions of the Constitution.13 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. Nor can it be used to enlarge the power of the administrative agency beyond the scope intended. Constitutional and statutory provisions control with respect to what rules and regulations may be promulgated by administrative agencies and the scope of their regulations.14 In the case at bar, we find that the impugned A.O. is invalid as it contravenes the Constitution. The A.O. sought to regulate livestock farms by including them in the coverage of agrarian reform and prescribing a maximum retention limit for their ownership. However, the deliberations of the 1987 Constitutional Commission show a clear intent to exclude, inter alia, all lands exclusively devoted to livestock, swine and poultry- raising. The Court clarified in the Luz Farms case that livestock, swine and poultry-raising are industrial activities and do not fall within the definition of "agriculture" or "agricultural activity." The raising of livestock, swine and poultry is different from crop or tree farming. It is an industrial, not an agricultural, activity. A great portion of the investment in this enterprise is in the form of industrial fixed assets, such as: animal housing structures and facilities, drainage, waterers and blowers, feedmill with grinders, mixers, conveyors, exhausts and generators, extensive warehousing facilities for feeds and other supplies, anti-pollution equipment like bio-gas and digester plants augmented by lagoons and concrete ponds, deepwells, elevated water tanks, pumphouses, sprayers, and other technological appurtenances.15 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. The subsequent case of Natalia Realty, Inc. v. DAR16 reiterated our ruling in the Luz Farms case. In Natalia Realty, the Court held that industrial, commercial and residential lands are not covered by the CARL.17 We stressed anew that while Section 4 of R.A. No. 6657 provides that the CARL shall cover all public and private agricultural lands, the term "agricultural land" does not include lands classified as mineral, forest, residential, commercial or industrial. Thus, in Natalia Realty, even portions of the Antipolo Hills

Subdivision, which are arable yet still undeveloped, could not be considered as agricultural lands subject to agrarian reform as these lots were already classified as residential lands. A similar logical deduction should be followed in the case at bar. Lands devoted to raising of livestock, poultry and swine have been classified as industrial, not agricultural, lands and thus exempt from agrarian reform. Petitioner DAR argues that, in issuing the impugned A.O., it was seeking to address the reports it has received that some unscrupulous landowners have been converting their agricultural lands to livestock farms to avoid their coverage by the agrarian reform. Again, we find neither merit nor logic in this contention. The undesirable scenario which petitioner seeks to prevent with the issuance of the A.O. clearly does not apply in this case.Respondents family acquired their landholdings as early as 1948. They have long been in the business of breeding cattle in Masbate which is popularly known as the cattlebreeding capital of the Philippines.18 Petitioner DAR does not dispute this fact. Indeed, there is no evidence on record that respondents have just recently engaged in or converted to the business of breeding cattle after the enactment of the CARL that may lead one to suspect that respondents intended to evade its coverage. It must be stressed that what the CARL prohibits is theconversion of agricultural lands for non-agricultural purposes after the effectivity of the CARL. There has been no change of business interest in the case of respondents. Moreover, it is a fundamental rule of statutory construction that the reenactment of a statute by Congress without substantial change is an implied legislative approval and adoption of the previous law. On the other hand, by making a new law, Congress seeks to supersede an earlier one.19 In the case at bar, after the passage of the 1988 CARL, Congress enacted R.A. No. 788120 which amended certain provisions of the CARL. Specifically, the new law changed the definition of the terms "agricultural activity" and "commercial farming" by dropping from its coverage lands that are devoted to commercial livestock, poultry and swineraising.21 With this significant modification, Congress clearly sought to align the provisions of our agrarian laws with the intent of the 1987 Constitutional Commission to exclude livestock farms from the coverage of agrarian reform. In sum, it is doctrinal that rules of administrative bodies must be in harmony with the provisions of the Constitution. They cannot amend or extend the Constitution. To be valid, they must conform to and be consistent with the Constitution. In case of conflict between an administrative order and the provisions of the Constitution, the latter prevails.22 The assailed A.O. of petitioner DAR was properly stricken down as unconstitutional as it enlarges the coverage of agrarian reform beyond the scope intended by the 1987 Constitution. IN VIEW WHEREOF, the petition is DISMISSED. The assailed Decision and Resolution of the Court of Appeals, dated September 19, 2003 and February 4, 2004, respectively, are AFFIRMED. No pronouncement as to costs. SO ORDERED. REYNATO S. PUNO

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. Nos. L-32370 & 32767 April 20, 1983 SIERRA MADRE TRUST, petitioner, vs. HONORABLE SECRETARY OF AGRICULTURE AND NATURAL RESOURCES, DIRECTOR OF MINES, JUSAN TRUST MINING COMPANY, and J & S PARTNERSHIP, respondents. Lobruga Rondoz & Cardenas Law Offices for petitioner. Fortunato de Leon for respondents.

ABAD SANTOS, J.: This is a petition to review a decision of the Secretary of Agriculture and Natural Resources dated July 8, 1970, in DANR Cases Numbered 3502 and 3502-A. The decision affirmed a decision of the Director of Mines dated November 6, 1969. The appeal was made pursuant to Sec. 61 of the Mining Law (C.A. No. 137, as amended) which provides: "... Findings of facts in the decision or order of the Director of Mines when affirmed by the Secretary of Agriculture and Natural Resources shall be final and conclusive, and the aggrieved party or parties desiring to appeal from such decision or order shall file in the Supreme Court a petition for review wherein only questions of law may be raised." The factual background is given in the brief of the petitioner-appellant which has not been contradicted by the respondents-appellees and is as follows: On July 26, 1962, the Sierra Madre Trust filed with the Bureau of Mines an Adverse Claim against LLA No. V-7872 (Amd) of the Jusan Trust Mining Company over six (6) lode mineral claims, viz.: (1) Finland 2, (2) Finland 3, (3) Finland 5, (4) Finland 6, (5) Finland 8 and (6) Finland 9, all registered on December 11, 1964 with the office of the Mining Recorder of Nueva Vizcaya, and all situated in Sitio Maghanay, Barrio Abaca Municipality of Dupax, Province of Nueva Vizcaya. The adverse claim alleged that the aforementioned six (6) lode minerals claims covered by LLA No. V-7872 (Amd) encroached and overlapped the eleven (11) lode mineral claims of the herein petitioner Sierra Madre Trust, viz., (1) A-12, (2) H-12, (3) JC-11, (4) W-11, (5) JN-11, (6)WM-11, (7) F-10, (8) A-9, (9) N-9, (10) W-8, and (11) JN-8, all situated in Sitio Taduan Barrio of Abaca, Municipality of Dupax, Province of Nueva Vizcaya, and duly registered with the office of the Mining Recorder at Bayombong, Nueva Vizcaya on May 14, 1965.

The adverse claim prayed for an order or decision declaring the abovementioned six (6) lode mineral claims of respondent Jusan Trust Mining Company, null, void, and illegal; and denying lode lease application LLA No. V7872 over said claims. Further, the adverse claimant prayed for such other reliefs and remedies available in the premises. This adverse claim was docketed in the Bureau of Mines as Mines Administrative Case No. V-404, and on appeal to the Department of Agriculture and Natural Resources as DANR Case No. 3502. Likewise, on the same date July 26, 1966, the same Sierra Madre Trust filed with the Bureau of Mines an Adverse Claim against LLA No. V-9028 of the J & S Partnership over six (6) lode mineral claims viz.: (1) A-19, (2) A-20, (3) A-24, (4) A-25, (5) A-29, and (6) A-30, all registered on March 30, 1965 and amended August 5, 1965, with the office of the Mining Recorder of Nueva Vizcaya, and situated in Sitio Gatid, Barrio of Abaca Municipality of Dupax, Province of Nueva Vizcaya. The adverse claim alleged that the aforementioned six (6) lode mineral claim covered by LLA No. V-9028, encroached and overlapped the thirteen (13) lode mineral claims of herein petitioner Sierra Madre Trust, viz.: (1) Wm-14, (2) F-14, (3) A-13, (4) H-12 (5) Jc-12, (6) W-12, (7) Jn-11, (8) Wm-11, (9) F-11, (10) Wm11, (11) F-11; (12) H-9 and (13) Jc-9, all situated in Sitio Taduan, Barrio of Abaca Municipality of Dupax, Province of Nueva Vizcaya and duly registered with the office of the Mining Recorder at Bayombong, Nueva Vizcaya, on May 14,1965. The adverse claim prayed for an order or decision declaring the abovementioned six (6) claims of respondent J & S Partnership, null void, and illegal; and denying lode lease application LLA No. V-9028 over the said claims. Further, the adverse claimant prayed for such other reliefs and remedies available in the premises. This adverse claim was docketed in the Bureau of Mines as Mines Administrative Case No. V-404, and on appeal to the Department of Agriculture and Natural Resources as DANR Case No. 3502A. These two (2) adverse claims, MAC Nos. V-403 and V-404 were jointly heard in the Bureau of Mines, and also jointly considered in the appeal in the Department of Agriculture and Natural Resources. The dispositive portion of the decision rendered by the Director of Mines reads: IN VIEW OF THE FOREGOING, this Office believes and so holds that the respondents have the preferential right over their "Finland-2", "Finland- 3", "Finland-5", "Finland-6", "Finland-8", "Finland-9", "A-19", "A-20", "A-24", "A-25", "A-29" and "A-30" mining claims. Accordingly, the protests (adverse claims) filed by protestant Sierra Madre Trust should be, as hereby they are, DISMISSED. And that of the Secretary of Agriculture and Natural Resources reads:

IN THE LIGHT OF ALL THE FOREGOING, the appeal interposed by the appellant, Sierra Madre Trust is hereby dismissed and the decision of the Director of Mines dated November 6, 1969, affirmed. " The adverse claims of Sierra Madre Trust against Jusan Trust Mining Company and J and S Partnership were based on the allegation that the lode lease applications (LLA) of the latter "encroached and overlapped" the former's mineral claims, However, acting on the adverse claims, the Director of Mines found that, "By sheer force of evidence, this Office is constrained to believe that there exists no conflict or overlapping between the protestant's and respondents' mining claims. " And this finding was affirmed by the Secretary of Agriculture and Natural Resources thus: "Anent the first allegation, this Office finds that the Director of Mines did not err when he found that the twelve (12) claims of respondents Jusan Trust Mining Company and J & S Partnership did not encroach and overlap the eighteen (18) lode mineral claims of the appellant Sierra Madre Trust. For this fact has been incotrovertibly proven by the records appertaining to the case." It should be noted that according to the Director of Mines in his decision, "during the intervening period from the 31st day after the discovery [by the respondents] to the date of location nobody else located the area covered thereby. ... the protestant [petitioner herein] did not establish any intervening right as it is our findings that their mining claims do not overlap respondents' mining claims." After the Secretary of Agriculture and Natural Resources had affirmed the factual findings of the Director of Mines to the effect that there was no overlapping of claims and which findings were final and conclusive, Sierra Madre Trust should have kept its peace for obviously it suffered no material injury and had no pecuniary interest to protect. But it was obstinate and raised this legal question before Us: "May there be a valid location of mining claims after the lapse of thirty (30) days from date of discovery, in contravention to the mandatory provision of Section 33 of the New Mining Law (Com. Act No. 137, as amended)?" It also raised ancillary questions. We see no reason why We have to answer the questions in this petition considering that there is no justiciable issue between the parties. The officers of the Executive Department tasked with administering the Mining Law have found that there is neither encroachment nor overlapping in respect of the claims involved. Accordingly, whatever may be the answers to the questions will not materially serve the interests of the petitioner. In closing it is useful to remind litigation prone individuals that the interpretation by officers of laws which are entrusted to their administration is entitled to great respect.' In his decision, the Secretary of Agriculture and Natural Resources said: "This Office is in conformity with the findings of the Director of Mines that the mining claims of the appellees were validly located, surveyed and registered." Finally, the petitioner also asks: "May an association and/or partnership registered with the Mining Recorder of a province, but not registered with the Securities and Exchange Commission, be vested with juridical personality to enable it to locate and then lease mining claims from the government?" Suffice it to state that this question was not raised before the Director of Mines and the Secretary of Agriculture and Natural Resources. There is also nothing in the record to indicate whether or not the appellees are registered with the Securities and Exchange Commission. For these reasons, even assuming that there is a justiciable issue between the parties, this question cannot be passed upon.

WHEREFORE, the petition for review is hereby dismissed for lack of merit. Costs against the petitioner. SO ORDERED. Makasiar (Chairman), Concepcion Jr., Guerrero, De Castro and Escolin JJ., concur. Aquino, J., is on leave.

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