EN BANC
LAND BANK OF THE
PHILIPPINES,
Petitioner,
G.R.
No.
143275
March 20, 2003
-versus-
ARLENE DE LEON AND
BERNARDO DE LEON,
Respondents.
R E S O L U
T I O N
CORONA,
J.:chanroblesvirtuallawlibrary
Before us are the motion
for reconsideration dated October 16, 2002 and supplement to the motion
for reconsideration dated November 11, 2002 filed by movant-petitioner
Land Bank of the Philippines (LBP, for brevity) seeking a reversal of
this
Court's Decision[1]
dated September 10, 2002 which denied LBP's petition for review.chanrobles virtuallaw libraryred
Herein respondent spouses
Arlene and Bernardo de Leon filed a petition to fix the just
compensation
of a parcel of land[2]
before the Regional Trial Court of Tarlac, Branch 63, acting as a
Special
Agrarian Court. On December 19, 1997, the agrarian court rendered
summary
judgment fixing the compensation of the subject property as follows:
(1)
P1,260,000 for the 16.69 hectares of riceland and (2) P2,957,250 for
the
30.4160 hectares of sugarland.cralaw:red
The Department of Agrarian
Reform (DAR, for brevity) and LBP both filed separate appeals using
different
modes. DAR filed a petition for review while LBP interposed an ordinary
appeal by filing a notice of appeal. DAR's petition for review[3]
was assigned to the Special Third Division of the Court of Appeals
while
LBP's ordinary appeal[4]
was assigned to the Fourth Division of the same court.cralaw:red
On November 6, 1998,
the appellate court's Special Third Division rendered a decision in the
petition for review filed by DAR, the dispositive portion of which
reads:
WHEREFORE, premises
considered, the petition for review is GIVEN DUE COURSE. The decision
dated
February 9, 1998 is partially reconsidered. The trial court is ordered
to recompute the compensation based on the selling price of palay at
213.00
per cavan. Petitioner is ordered to pay legal interest at 6% of the
compensation
so fixed from 1990 until full payment is made by the government.[5]chanrobles virtuallaw libraryred
Meanwhile, on February
15, 2000, the appellate court's Fourth Division dismissed LBP's
ordinary
appeal primarily holding that LBP availed of the wrong mode of appeal.[6]
LBP filed a motion for reconsideration but the same was denied.cralaw:red
On July 14, 2000, LBP
filed before this Court a petition for review of the decision of the
Court
of Appeals. On September 10, 2002, this Court rendered a Decision, the
dispositive portion of which reads:
WHEREFORE, the appealed
RESOLUTIONS, dated February 15, 2000 and May 22, 2000, respectively, of
the Court of Appeals are hereby AFFIRMED. No costs.cralaw:red
SO ORDERED.[7]
In affirming the dismissal
by the appellate court of LBP's ordinary appeal, this Court held that
Section
60[8]
of RA 6657 (The Comprehensive Agrarian Reform Law) is clear in
providing
petition for review as the appropriate mode of appeal from decisions of
Special Agrarian Courts. Section 61[9]
(the provision on which LBP bases its argument that ordinary appeal is
the correct mode of appeal from decisions of Special Agrarian Courts)
merely
makes a general reference to the Rules of Court and does not
categorically
prescribe ordinary appeal as the correct way of questioning decisions
of
Special Agrarian Courts. Thus, we interpreted Section 61 to mean that
the
specific rules for petitions for review in the Rules of Court and other
relevant procedures of appeals shall be followed in appealed decisions
of Special Agrarian Courts.chanrobles virtuallaw libraryred
We likewise held that
Section 60 of RA 6657 is constitutional and does not violate this
Court's
power to "promulgate rules concerning the protection and enforcement of
constitutional rights, pleadings, practice and procedure in all courts,
the admission to the practice of law, the Integrated Bar and legal
assistance
to the underprivileged."[10]
We ruled that the Rules of Court does not categorically prescribe
ordinary
appeal as the exclusive mode of appeal from decisions of Special
Agrarian
Courts. The reference by Section 61 to the Rules of Court in fact even
supports the mode of a petition for review as the appropriate way to
appeal
decisions of the Special Agrarian Courts. Furthermore, the same Section
5(5), Article VIII of the 1987 Philippine Constitution quoted by LBP
states
that "rules of procedure of special courts and quasi-judicial bodies
shall
remain effective unless disapproved by the Supreme Court." Since
Section
60 is a special procedure and this Court has not yet provided for a
particular
process for appeals from decisions of agrarian courts, the said section
does not encroach on our rule-making power.cralaw:red
Hence, LBP filed the
instant motion for reconsideration and supplement to the motion for
reconsideration
reiterating its claim in the petition for review that Section 60 of RA
6657 is unconstitutional. LBP still maintains that a legislative act
like
Section 60 infringes on the exclusive rule-making power of this Court
in
violation of the 1987 Philippine Constitution.cralaw:red
In the event that said
argument is again rejected, LBP pleads that the subject Decision should
at least be given prospective application considering that more than 60
similar agrarian cases filed by LBP via ordinary appeal before the
Court
of Appeals are in danger of being dismissed outright on technical
grounds
on account of our ruling herein. This, according to LBP, will wreak
financial
havoc not only on LBP as the financial intermediary of the
Comprehensive
Agrarian Reform Program but also on the national treasury and the
already
depressed economic condition of our country.[11]
Thus, in the interest of fair play, equity and justice, LBP stresses
the
need for the rules to be relaxed so as to give substantial
consideration
to the appealed cases.cralaw:red
On the first ground,
we find it needless to re-discuss the reasons already propounded in our
September 10, 2002 Decision explaining why Section 60 of RA 6657 does
not
encroach on our constitutional rule-making power.chanrobles virtuallaw libraryred
Be that as it may, we
deem it necessary to clarify our Decision's application to and effect
on
LBP's pending cases filed as ordinary appeals before the Court of
Appeals.
It must first be stressed that the instant case poses a novel issue;
our
Decision herein will be a landmark ruling on the proper way to appeal
decisions
of Special Agrarian Courts. Before this case reached us, LBP had no
authoritative
guideline on how to appeal decisions of Special Agrarian Courts
considering
the seemingly conflicting provisions of Section 60 and 61 of RA 6657.cralaw:red
More importantly, the
Court of Appeals has rendered conflicting decisions on this precise
issue.
On the strength of Land Bank of the Philippines vs. Hon. Feliciano
Buenaventura,
penned by Associate Justice Salvador Valdez, Jr. of the Court of
Appeals,
certain decisions[12]
of the appellate court held that an ordinary appeal is the proper mode.
On the other hand, a decision[13]
of the same court, penned by Associate Justice Romeo Brawner and
subject
of the instant review, held that the proper mode of appeal is a
petition
for review. In another case,[14]
the Court of Appeals also entertained an appeal by the DAR filed as a
petition
for review.cralaw:red
On account of the absence
of jurisprudence interpreting Sections 60 and 61 of RA 6657 regarding
the
proper way to appeal decisions of Special Agrarian Courts as well as
the
conflicting decisions of the Court of Appeals thereon, LBP cannot be
blamed
for availing of the wrong mode. Based on its own interpretation and
reliance
on the Buenaventura ruling, LBP acted on the mistaken belief that an
ordinary
appeal is the appropriate manner to question decisions of Special
Agrarian
Courts.cralaw:red
Hence, in the light
of the aforementioned circumstances, we find it proper to emphasize the
prospective application of our Decision dated September 10, 2002. A
prospective
application of our Decision is not only grounded on equity and fair
play
but also based on the constitutional tenet that rules of procedure
shall
not impair substantive rights.cralaw:red
In accordance with our
constitutional power to review rules of procedure of special courts,[15]
our Decision in the instant case actually lays down a rule of
procedure,
specifically, a rule on the proper mode of appeal from decisions of
Special
Agrarian Courts. Under Section 5 (5), Article VIII of the 1987
Philippine
Constitution, rules of procedure shall not diminish, increase or modify
substantive rights. In determining whether a rule of procedure affects
substantive rights, the test is laid down in Fabian vs. Desierto,[16]
which provides that:chanrobles virtuallaw libraryred
[I]n determining whether
a rule prescribed by the Supreme Court, for the practice and procedure
of the lower courts, abridges, enlarges, or modifies any substantive
right,
the test is whether the rule really regulates procedure, that is, the
judicial
process for enforcing rights and duties recognized by substantive law
and
for justly administering remedy and redress for a disregard or
infraction
of them. If the rule takes away a vested right, it is not procedural.
If
the rule creates a right such as the right to appeal, it may be
classified
as a substantive matter; but if it operates as a means of implementing
an existing right then the rule deals merely with
procedure.
talics supplied)
We hold that our Decision,
declaring a petition for review as the proper mode of appeal from
judgments
of Special Agrarian Courts, is a rule of procedure which affects
substantive
rights. If our ruling is given retroactive application, it will
prejudice
LBP's right to appeal because pending appeals in the Court of Appeals
will
be dismissed outright on mere technicality thereby sacrificing the
substantial
merits thereof. It would be unjust to apply a new doctrine to a pending
case involving a party who already invoked a contrary view and who
acted
in good faith thereon prior to the issuance of said doctrine.chanrobles virtuallaw libraryred
In the 1992 case of
Spouses Benzonan vs. Court of Appeals,[17]
respondent Pe, whose land was foreclosed by Development Bank of the
Philippines
in 1977 and subsequently sold to petitioners Benzonan in 1979, tried to
invoke a 1988 Supreme Court ruling counting the five-year period to
repurchase
from the expiration (in 1978) of the one-year period to redeem the
foreclosed
property. Said 1988 ruling reversed the 1957 and 1984 doctrines which
counted
the five-year period to repurchase from the date of conveyance of
foreclosure
sale (in 1977). Using the 1988 ruling, respondent Pe claimed that his
action
to repurchase in 1983 had not yet prescribed.cralaw:red
However, this Court
refused to apply the 1988 ruling and instead held that the 1957 and
1984
doctrines (the prevailing ruling when Pe filed the case in 1983) should
govern. The 1988 ruling should not retroact to and benefit Pe's 1983
case
to repurchase. Thus, the action had indeed prescribed. This Court
justified
the prospective application of the 1988 ruling as follows:
We sustain the petitioners'
position. It is undisputed that the subject lot was mortgaged to DBP on
February 24, 1970. It was acquired by DBP as the highest bidder at a
foreclosure
sale on June 18, 1977, and then sold to the petitioners on September
29,
1979.chanrobles virtuallaw libraryred
At that time, the prevailing
jurisprudence interpreting section 119 of R.A. 141 as amended was that
enunciated in Monge and Tupas cited above. The petitioners Benzonan and
respondent Pe and the DBP are bound by these decisions for pursuant to
Article 8 of the Civil Code "judicial decisions applying or
interpreting
the laws or the Constitution shall form a part of the legal system of
the
Philippines." But while our decisions form part of the law of the land,
they are also subject to Article 4 of the Civil Code which provides
that
"laws shall have no retroactive effect unless the contrary is
provided."
This is expressed in the familiar legal maxim lex prospicit, non
respicit,
the law looks forward not backward. The rationale against retroactivity
is easy to perceive. The retroactive application of a law usually
divests
rights that have already become vested or impairs the obligations of
contract
and hence, is unconstitutional (Francisco v. Certeza, 3 SCRA 565
[1961]).cralaw:red
The same consideration
underlies our rulings giving only prospective effect to decisions
enunciating
new doctrines.cralaw:red
xxx
xxx xxx
The buyers in good faith
from DBP had a right to rely on our rulings in Monge and Tupas when
they
purchased the property from DBP in 1979 or thirteen (13) years ago.
Under
the rulings in these two cases, the period to repurchase the disputed
lot
given to respondent Pe expired on June 18, 1982. He failed to exercise
his right. His lost right cannot be
revived
by relying on the 1988 case of Belisario. The right of petitioners over
the subject lot had already become vested as of that time and cannot be
impaired by the retroactive application of the Belisario ruling.[18]
(Emphasis supplied)chanrobles virtuallaw libraryred
WHEREFORE, the motion
for reconsideration dated October 16, 2002 and the supplement to the
motion
for reconsideration dated November 11, 2002 are PARTIALLY GRANTED.
While
we clarify that the Decision of this Court dated September 10, 2002
stands,
our ruling therein that a petition for review is the correct mode of
appeal
from decisions of Special Agrarian Courts shall apply only to cases
appealed
after the finality of this Resolution.cralaw:red
SO ORDERED.cralaw:red
Davide, Jr., C.J.,
Bellosillo,
Puno, Vitug, Mendoza, Panganiban, Quisumbing, Sandoval-Gutierrez,
Carpio,
Austria-Martinez, Carpio-Morales, Callejo, Sr., and Azcuna, JJ., concur.
Ynares-Santiago, J.,
on leave.cralaw:red
____________________________
Endnotes:
[1]
G.R. No. 143275.
[2]
Covered by TCT No. 163051 with a total area of 50. 1171 hectares.
[3]
Docketed as CA-G.R. SP No. 47005.
[4]
Docketed as CA-G.R. CV No. 60365.
[5]
Rollo, p. 105.chanrobles virtuallaw libraryred
[6]
Rollo, pp. 12-13.
[7]
Rollo, p. 575.
[8]Section
60. Appeals. An appeal may be taken from the decision of the Special
Agrarian
Courts by filing a petition for review with the Court of Appeals within
fifteen (15) days from receipt of notice of the decision; otherwise,
the
decision shall become final.chanrobles virtuallaw libraryred
[9]
Section 61. Procedure in Review. - Review by the Court of Appeals
or the Supreme Court, as the case may be, shall be governed by the
Rules
of Court. The Court of Appeals, however, may require the parties to
file
simultaneous memoranda within a period or fifteen (15) days from
notice,
after which the case is deemed submitted for decision.
[10]
Section 5(5), Article VIII, 1987 Constitution of the Philippines.chanrobles virtuallaw libraryred
[11]
The pertinent portions of the supplement to the motion for
reconsideration
provides that:chanroblesvirtuallawlibrary
From
the initial CARP fund of P595.8 Million set up in 1987, the total CARP
fund released to the LBP and paid to the landowners and utilized for
operational
support amounted to P29.863 Billion as of September 2002 (please see
Annex
"H" herein). This is the total expense over a period of fifteen
(15)
years and covers hardly a third of the statutory budget of P100 Billion
for the CARP. The National Treasury lacks the money to pay for
the
exorbitant and unreasonable claims of the landowners which will have to
be paid once LBP's number of appealed cases before the Court of Appeals
are dismissed due to wrong mode of appeal. Such a scenario will
definitely
aggravate the country's fiscal deficit which stands at P180 Billion for
the current year (please see Annex "T" hereof).
x
x
x
xchanrobles virtuallaw libraryred
It
is worth stressing that LBP's total funding requirement for 2002 for
landowner's
compensation is P5.690 Billion, but the Congress-approved budget as per
General Appropriations Act of 2002 is only P2.854 Billion bringing a
funding
gap of P2.836 Billion (Annex "J").
9.
As of September 2002, LBP/s total cash advances for landowners'
compensation
stands at P3.044 Billion (Annex "K"). By the end of December 2002,
LBP's
projected total cash advances will increase by P900 Million (covering
October
to December 2002), for a total projected advance of P3.944 Billion for
the year (Annex "L" hereof).
For
its huge cash advances, LBP hopes to be refunded by the National
Government
from the Special Allotment Release Order (SARO), which is still
unfunded
at the present time, in the amount of P2.189 Billion (Annex "L"
hereof).
This will leave a total projected net unrefunded advance of P1.755
Billion
by the end of December 2002 (Annex "L").chanrobles virtuallaw libraryred
The
foregoing clearly and adequately shows the difficulty, if not
impossibility,
of LBP getting a refund, and consequently of funding the landowner's
claims.(Rollo,
pp. 498-499)
[12]
Gabatin vs. Department of Agrarian Reform, et. al., CA-G.R. CV
No.
61240, penned by Associate Justice Delilah Vidallon-Magtolis; Land Bank
of the Philippines vs. Hon. Salcedo, CA-G.R. No. SP No. 63651,
September
28, 2001, penned by Associate Justice Rodrigo Cosico; Tiangco vs.
Secretary
of Argrarian Reform, CA- G.R. CV No. 61676, October 5, 2001, penned by
Associate Justice Hilarion Aquino; Alimurong vs. Republic of the
Philippines, CA-G.R. CV No. 70721, July 5, 2002, penned by Associate
Justice
Mercedes Gozo-Dadole.chanrobles virtuallaw libraryred
[13]
Land Bank of the Philippines vs. Arlene de Leon, et. al., CA-G.R. CV
No.
60365, February 15, 2000.chanrobles virtuallaw libraryred
[14]
Docketed as CA-G.R. No. 47005 and the decision dated November 6, 1998
was
penned by Associate Justice Minerva Gonzaga-Reyes (former Associate
Justice
of this Court).
[15]
Section 5(5), Article VIII of the 1987 Philippine Constitution; Metro
Construction,
Inc. vs. Chatham Properties, G.R. No. 141897, September 24, 2001.
[16]
295 SCRA 470, 492, [1998]; Bernabe vs. Alejo, G.R. No. 140500, January
21, 2002.
[17]
205 SCRA 515 [1992].chanrobles virtuallaw libraryred
[18]
Id., p. 528. |