The Supreme Court held that farmer-beneficiaries of land awarded under the Comprehensive Agrarian Reform Law (CARL) cannot validly relinquish their rights to the land within a ten-year prohibitory period, even through voluntary agreements. The Court emphasized the law’s intent to protect landless farmers and ensure their continuous possession and cultivation of the land. This decision affirms that waivers or transfers of rights executed during this period are void, safeguarding the agrarian reform program’s goals against circumvention via contractual arrangements.

Can a Farmer-Beneficiary Waive Land Rights? Examining the Clash Between Agrarian Reform and Contractual Agreements

The case of Filinvest Land, Inc. v. Eduardo R. Adia, et al. revolves around a dispute over parcels of land in Barangay Hugo Perez, Trece Martires, Cavite. These lands were originally awarded to the respondents, who were farmer-beneficiaries, under the Comprehensive Agrarian Reform Law (CARL). Filinvest Land, Inc. (Filinvest) later took possession of these properties, purportedly based on sworn statements (Sinumpaang Salaysay) executed by the respondents, wherein they relinquished their rights over the properties for a consideration. The central legal question is whether these affidavits validly transferred the respondents’ rights, particularly the right to possess the land, to Filinvest, considering the restrictions imposed by CARL on the transferability of awarded lands.

Filinvest contended that the affidavits constituted a valid assignment of possessory rights, arguing that Section 27 of CARL only prohibits the sale, transfer, or conveyance of ownership, not the transfer of possession. The respondents, on the other hand, asserted that the affidavits were void because they effectively transferred ownership rights, contravening the provisions of CARL. The Court of Appeals (CA) sided with the respondents, ruling that the affidavits, in their terms, amounted to a transfer of all rights, including ownership, and were therefore in violation of Section 27 of CARL.

The Supreme Court’s analysis hinged on interpreting Section 27 of CARL, which states: “Lands acquired by the beneficiaries under this Act may not be sold, transferred or conveyed except through hereditary succession, or to the government, or the LBP, or to other qualified beneficiaries for a period of ten (10) years.” The Court emphasized that this provision is designed to protect the beneficiaries of agrarian reform from being easily swayed into parting with their awarded lands. This protection aims to ensure that the farmer-beneficiaries remain the actual tillers and owners of the land, fulfilling the agrarian reform program’s objectives.

The Court referenced several precedents, including Torres v. Ventura, which established that transfers of possessory rights over landholdings awarded under agrarian laws are void. Building on this principle, the Court reiterated that any waiver or transfer of rights and interests within the ten-year prohibitory period under RA 6657 is void for violating agrarian reform law. This legal stance underscores the paramount importance of safeguarding the farmer-beneficiaries’ rights over the land they till.

The Supreme Court scrutinized the content of the affidavits, noting that they went beyond a mere assignment of possessory rights. The affidavits contained clauses indicating a complete and perpetual surrender of the respondents’ ownership rights. Key phrases from the affidavits included: “bilang karapatang bayad sa lahat kong/naming interes, karapatan at paghahabol sa nasabing lupain” (as payment for all my/our interests, rights, and claims to the said land) and “kusang-loob ko/naming pinawawalang bisa at kabuluhan ang anumang interes, karapatan at paghahabol bilang magsasaka” (I/we voluntarily invalidate and nullify any interest, right, and claim as a farmer). These clauses, in the Court’s view, demonstrated an intention to transfer ownership rights, which is explicitly prohibited by Section 27 of CARL.

Filinvest also argued that even if the affidavits were deemed void, the principle of pari delicto should apply, meaning that both parties were equally at fault and should be left as they were. The Supreme Court rejected this argument, citing Torres, which held that the pari delicto doctrine does not apply in agrarian reform cases. The Court emphasized that to apply the doctrine would defeat the spirit and intent of agrarian reform. The Supreme Court invoked Article 1416 of the Civil Code, which provides an exception to the pari delicto doctrine. This article allows a plaintiff to recover what they have delivered pursuant to a void contract if (a) the contract is not illegal per se but merely prohibited; (b) the prohibition is for the plaintiff’s protection; and (c) public policy will be enhanced by the recovery.

In this case, the Court found that all three requisites were met: the affidavits were merely prohibited by CARL, not inherently illegal; the prohibition under Section 27 of CARL is designed to protect farmer-beneficiaries; and allowing the respondents to recover their land would promote the public policy of agrarian reform. These considerations tipped the scales in favor of the respondents, allowing them to reclaim their land despite their initial participation in the void transactions.

The Supreme Court also addressed the issue of unjust enrichment raised by Filinvest. The Court acknowledged that Filinvest had possessed the properties since 1995, depriving the respondents of the productive use of their land for an extended period. The Court reasoned that the consideration paid to the respondents by Filinvest could be seen as compensation for the company’s use of the land during that time. Therefore, the Court concluded that there was no unjust enrichment in allowing the respondents to recover their properties.

Finally, the Supreme Court noted the respondents’ manifestation that new Transfer Certificates of Title (TCTs) had been issued in Filinvest’s name. While the current case was an accion publiciana, which only resolves possessory rights, the Court acknowledged that the revocation of TCTs requires a conclusive determination of ownership. Thus, the Court advised the respondents to file a separate action to annul the TCTs issued in Filinvest’s name.

FAQs

What was the key issue in this case?	The central issue was whether farmer-beneficiaries could validly relinquish their rights to land awarded under the Comprehensive Agrarian Reform Law (CARL) through voluntary agreements within the ten-year prohibitory period.
What is an accion publiciana?	An accion publiciana is a lawsuit for the recovery of possession of property. In this case, it was used to determine who had the better right to possess the land, independently of ownership.
What is the pari delicto doctrine?	The pari delicto doctrine states that when two parties are equally at fault in an illegal transaction, neither party can seek legal remedies against the other. However, this doctrine has exceptions, especially in cases involving agrarian reform.
What is Section 27 of the Comprehensive Agrarian Reform Law (CARL)?	Section 27 of CARL prohibits the sale, transfer, or conveyance of lands awarded to beneficiaries under the Act within a period of ten years, except through hereditary succession, or to the government, or the Land Bank of the Philippines (LBP), or to other qualified beneficiaries.
Why did the Supreme Court rule against Filinvest?	The Supreme Court ruled against Filinvest because the affidavits signed by the farmer-beneficiaries effectively transferred their ownership rights within the prohibited period, violating Section 27 of CARL.
Can farmer-beneficiaries ever transfer their land rights?	Yes, farmer-beneficiaries can transfer their land rights after the ten-year prohibitory period has expired, or through specific exceptions outlined in Section 27 of CARL, such as hereditary succession or transfer to the government.
What does this case mean for land developers?	This case clarifies that land developers cannot rely on agreements with farmer-beneficiaries that circumvent the restrictions imposed by agrarian reform laws. They must respect the rights and protections afforded to farmer-beneficiaries.
What action did the court suggest regarding the new land titles in Filinvest’s name?	The Supreme Court suggested that the respondents should file a separate legal action to annul the Transfer Certificates of Title (TCTs) that were issued in Filinvest’s name, as the current case only addressed possessory rights, not ownership.

This ruling reinforces the importance of agrarian reform laws in protecting the rights of farmer-beneficiaries. It underscores that agreements, regardless of their form, that effectively transfer ownership or possession of awarded lands within the prohibited period are void and unenforceable. The decision serves as a reminder to land developers and other parties to exercise caution and respect the legal framework designed to safeguard the rights of landless farmers.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Filinvest Land, Inc. v. Eduardo R. Adia, G.R. No. 192629, November 25, 2015