Land Bank of the Philippines v.

CA
Francisco, R.J. | October 6, 1995

FACTS:

 Heirs of Emiliano Santiago (private respondents) are landowners whose landholdings

were acquired by the DAR and subjected to transfer schemes to qualified beneficiaries
under the Comprehensive Agrarian Reform Law (CARL, Republic Act No. 6657).
 Private respondents argued that DAR Administrative Order No. 9, Series of 1990 was
issued without jurisdiction and with grave abuse of discretion because it permits the
opening of trust accounts by the Landbank, in lieu of depositing in cash or bonds in an
accessible bank designated by the DAR, the compensation for the land before it is taken
and the titles are cancelled.
 They also assail the fact that the DAR and the Landbank merely "earmarked",
"deposited in trust" or "reserved" the compensation in their names as landowners
despite the clear mandate that before taking possession of the property, the
compensation must be deposited in cash or in bonds.
ISSUE: Whether or not DAR Administrative Order No. 9 is null and void insofar as it provides for
the opening of trust accounts in lieu of deposit in cash or in bonds. Yes.
HOLDING:

 Petitioner argued that the word "deposit" as used in Section 16(e) of RA 6657 referred
merely to the act of depositing and in no way excluded the opening of a trust account as
a form of deposit. Thus, in opting for the opening of a trust account as the acceptable
form of deposit through Administrative Circular No. 9, petitioner DAR did not commit any
grave abuse of discretion since it merely exercised its power to promulgate rules and
regulations in implementing the declared policies of RA 6657.
 DAR clearly overstepped the limits of its power to enact rules and regulations when it
issued Administrative Circular No. 9. Under Section 16(e) of RA 6657, it is very explicit
therefrom that the deposit must be made only in "cash" or in "LBP bonds". Nowhere
does it appear, nor can it be inferred that the deposit can be made in any other form. If it
were the intention to include a "trust account" among the valid modes of deposit, that
should have been made express, or at least, qualifying words ought to have appeared
from which it can be fairly deduced that a "trust account" is allowed.
 They also cannot invoke LRA Circular Nos. 29, 29-A and 54 because these
implementing regulations cannot outweigh the clear provision of the law.
RULING:
Petition denied.