Roxas and Company, Inc. vs.DAMBA-NSFW and DAR

FACTS:

Roxas & Co. is a domestic corporation and is the registered owner of three haciendas. On July 27, 1987, the Congress of the Philippines formally convened and took over legislativepower from the President. This Congress passed Republic Act No.6657, the Comprehensive Agrarian Reform Law (CARL) of 1988. The Act wassigned by the President onJune 10, 1988 andtook effect on June 15, 1988. Before thelaws effectivity, on May 6, 1988, [Roxas &Co.] filed with respondent DAR avoluntary offer to sell [VOS] Hacienda Caylaway pursuant to the provisions of E.O.No. 229. Haciendas Palico and Baniladwere later placed under compulsory acquisition by DAR inaccordance with the CARL. On August 6, 1992 [Roxas & Co.], through its President, sent aletter to theSecretary of DAR withdrawing its VOS of Hacienda Caylaway.The Sangguniang Bayan of Nasugbu, Batangas allegedly authorized the reclassification of Hacienda Caylaway from agricultural tonon-agricultural As a result, petitioner informed respondent DAR that it was applying forconversion of Hacienda Caylaway from agricultural to other uses. The petitions nub onthe interpretation of Presidential Proclamation (PP) 1520 reads: DECLARING THE MUNICIPALITIES OF MARAGONDON AND TERNATE IN CAVITE PROVINCE ANDTHE MUNICIPALITY OF NASUGBU IN BATANGAS ASA TOURISTZONE, AND FOROTHER PURPOSES Essentially, Roxas & Co. filed its application forconversion of its three haciendas from agricultural tonon-agricultural on the assumption that the issuance of PP 1520which declared Nasugbu, Batangas as atourism zone, reclassified them to non-agricultural uses. Its pending application notwithstanding, the Department of Agrarian Reform (DAR) issued Certificates of Land Ownership Award (CLOAs) to the farmer-beneficiaries in the three haciendas including CLOA No. 6654 which was issued on October 15, 1993 covering 513.983 hectares, the subject of G.R. No. 167505. Roxas & Co.filed with the DAR anapplication forexemption from the coverage of the Comprehensive Agrarian Reform Program (CARP) of 1988on the basis ofPP 1520 and ofDAR Administrative Order (AO) No. 6, Series of 19943 which states that all landsalready classified as commercial, industrial, orresidential before the effectivity of CARP no longerneed conversion clearance from the DAR.ISSUES:Whether PP 1520 reclassified in 1975all lands inthe Maragondon-Ternate-Nasugbu tourism zone tonon-agricultural useto exempt Roxas & Co.s threehaciendas in Nasugbu from CARP coverage;

RULING:PP 1520 DID NOTAUTOMATICALLY CONVERT THE AGRICULTURAL LANDS IN THETHREE MUNICIPALITIES INCLUDINGNASUGBU TO NON-AGRICULTURAL LANDS.Roxas & Co. contends that PP 1520declared the three municipalities as eachconstituting a tourism zone, reclassified all landstherein to tourism and, therefore, converted their use tonon-agricultural purposes.The perambulatory clauses of PP 1520identified only "certain areas in thesector comprising the [three Municipalities that] havepotential tourism value" and mandated the conduct of"necessary studies" and the segregation of "specific geographic areas"toachieve its purpose. Which iswhy the PP directed the PhilippineTourism Authority (PTA) to identify what those potential tourismareas are. If all the lands in those tourism zones were to be wholly converted to non-agricultural use, there would have been noneed for the PP to direct the PTA to identify what those "specific geographic areas" are.In the above-cited case of Roxas & Co. v. CA, 9the Court made it clearthat the "power to determine whetherHaciendas Palico,Banilad and Caylaway are non-agricultural, hence, exempt from the coverage ofthe [Comprehensive Agrarian Reform Law] lies withthe [Department of Agrarian Reform], not with this Court." TheDAR, an administrative body of special competence, denied, byOrder, the application for CARP exemption of Roxas & Co., it finding that PP 1520 did not automatically reclassify all the lands in theaffected municipalities from their original uses. It appears that thePTA had not yet, atthat time, identified the "specific geographic areas" for tourism development and had nopending tourism development projects in the areas. Further, report fromthe Center forLand Use Policy Planning andImplementation (CLUPPI) indicated that the areaswere planted with sugar caneand other crops.11Relatedly, the DAR, by Memorandum Circular No. 7, Series of2004,12came up with clarificatory guidelines andtherein decreed thatB. Proclamations declaring general areas such aswhole provinces, municipalities, barangays, islands or peninsulas astourist zones that merely:(1) recognize certain still unidentified areas withinthe covered provinces, municipalities, barangays, islands, or peninsulasto be with potentialtourism value and charge the PhilippineTourism Authority with the task to identify/delineate specificgeographic areas within the zonewith potential tourism value and tocoordinate said areas development; or(2) recognize the potential value of identified spots located within the general area declared as tourist zone (i.e. x x x x)and direct the PhilippineTourism Authority to coordinate said areas development;could not be regarded as effecting an automatic reclassification of the entirety of the landarea declared as tourist zone. Thisis sobecause "reclassification of lands" denotes their allocation intosome specific use and "providing forthe manner of their utilizationand disposition (Sec. 20, Local Government Code) or the "act of specifying how agricultural lands shall be utilized for non-agricultural uses such as residential, industrial, or commercial, as embodied in the land useplan." A proclamation that merelyrecognizes the potential tourism value of certain areaswithin the general area declaredas tourist zone clearly does notallocate,reserve, or intend the entirety of theland area of thezone for non-agricultural purposes. Neither does said proclamation direct thatotherwise CARPable lands within the zone shallalready be used for purposesother than agricultural.Moreover, to view these kinds of proclamation as a reclassification for non-agricultural purposes of entire provinces, municipalities,barangays, islands, or peninsulas would beunreasonable as it amounts to anautomatic and sweeping exemption from CARP in thename of tourism development. The same would alsoundermine the land use reclassification powers vested inlocal governmentunits in conjunction with pertinent agencies ofgovernment.C. There being noreclassification, it is clear that said proclamations/issuances, assuming [these] took effect before June 15, 1988,could not supply abasis for exemption of the entirety ofthe lands embraced therein from CARP coverageD. The DARs reading intothese general proclamations of tourism zones deserves utmost consideration, more especially in thepresent petitions which involve vast tracts of agricultural land.To reiterate, PP 1520 merely recognized the "potentialtourism value" of certain areas within the general area declared as tourism zones. It did notreclassify the areas to non-agricultural use.A mere reclassification of an agricultural land does not automatically allow a landowner to change its use since there is still that process of conversion before one ispermitted to use it forother purposes