F U N D A M E N TA L D I S T I N C T I O N S

LEASEHOLD TENANCY TENANT EMANCIPATION DECREE COMPREHENSIVE AGRARIAN REFORMPROGRAM

I - LEGAL BASIS:

1. Republic Act No. 3844-Agricultural Land Reform Code(August 8, 1963)

2. Republic Act No. 6389-Code of Agrarian Reform(September 10, 1971)

3. Presidential Decree No.1425-Amending PresidentialDecree No. 1040 byStrengthening the Prohibitionagainst Agricultural Share,Tenancy and ProvidingPenalties for Violationthereof. (June 10, 1978)

1.Presidential Decree No. 27 –Tenant’s Emancipation Decree(October 21, 1972)

2. Letter Instruction No.474-PLACING UNDER OLTTENANTED RICE/CORN LANDSSEVEN HECTARES OR LESS INAREA UNDER CERTAIN CONDITION(OCTOBER 21, 1976)

1.Presidential Decree No. 27was assumed to beconstitutional and upheld aspart and parcel of the lawof the land in De Chavez vs.

Presidential Proclamation No.131-Instituting aComprehensive AgrarianReform Program (July 22,1987)

2.Republic Act No. 6657 – AnAct instituting aComprehensive AgrarianReform Program to PromoteSocial Justice andIndustrialization, providingthe Mechanism for itsImplementation and otherpurposes. (June 15, 1988)

1. The power of

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4. Section 12, RepublicAct No. 6657- ComprehensiveAgrarian Reform Law of 1988.

II – JURISPRUDENCE ONCONSTITUTIONALITY

1. Security of Tenure-Primero vs. CIR, 10 Phil. 675(1957); Pineda vs. de Guzman,21 SCRA 1450 (1967).

III – COVERAGE OR SCOPE

Agricultural Leaseholdshall apply to alltenanted agricultural lands,including but not limited tothe following –

Zobel, 155 SCRA 26; Gonzalesvs. Estrella, 91 SCRA 294(1979) and Association ofSmall Landowners in thePhilippines Inc. vs.Secretary of AgrarianReform, 175 SCRA 342 (1989)

2.Letter of Instruction No.474 Constitutionality wasupheld in Zurbano vs.Estrella, 137 SCRA 333(1989)

The REQUISITES FOR COVERAGEunder OPERATION LANDTRANSFER (OLT) program arethe following:

1.The land must be DEVOTEDto RICE or CORN crops;and

2.There must be a system

President Aquino topromulgate Proc. No. 131 andE.O. Nos. 228 and 229 wasauthorized under Section 6of the Transitory Provisionof the 1987 Constitution. All assault on thevalidity of RA 6657 was setaside. (Association of SmallLandowners in thePhilippines Inc. vs.Secretary of AgrarianReform, 175 SCRA 342 (1989)

COVERAGE OF CARL 1988 Scope – All PUBLIC andPRIVATE Agricultural Landsregardless of tenurialarrangement and commodityproduced, including lands ofthe public domain suitable foragriculture. (1st par. Sec. 4,

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A.Retained areas under R.A.6657 and P.D. 27;

B. Tenanted AgriculturalLands not yet acquired fordistribution under CARPpursuant to RA 6657;

C. All tenanted areasunder Section 10 of RA 6657which may be covered by thisOrder. (Administrative OrderNo. 4, Series of 1989)

IV - AREA OF COVERAGE

It shall beunlawful for the tenant,whenever the area of hisholding is five hectares ormore, or is of sufficientsize to make him and the

of SHARE CROP or LEASETENANCY obtainingtherein.

If either of theserequisites is ABSENT, theland is NOT COVERED underOLT. Hence, a landownerNEED NOT APPLY FORRETENTION, where hisownership over the entirelandholding is INTACT andUNDISTURBED. (EuclosiaDaez and/or Her Heirsrepresented by Edriano D.Daez vs. the Hon. CA, etal., 325 SCRA 857).

RULES ON COVERAGE OF LANDS UNDER PD 27.

Rule 1Landed estates orlandholdings larger than 24

RA 6657)

Specific lands covered byCARP.

a.All alienable anddisposable lands of thepublic domain devoted toor suitable foragriculture

b.All lands of the publicdomain in excess of thespecific limits asdetermined by Congress inthe preceding paragraph;

c.All other lands owned bythe Government devotedto or suitable foragriculture; and

d.All private lands devotedto or suitable foragriculture regardless of

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members of his immediate farmhousehold fully occupied inits cultivation, to CONTRACTTO WORK at the same time onTWO OR MORE SEPARATE HOLDINGSbelonging to differentlandholders under any systemof tenancy WITHOUT THEKNOWLEDGE AND CONSENT of thelandholder with whom he firstentered into tenancyrelationship. (Par. 1, Sec.24, republic Act No. 1199)

V – EXEMPTION OR EXCLUSION FROMCOVERAGE

Absence of anyof the six (6) EssentialElements of TenancyRelationship.

hectare (LOI 46 (December 7,1972) - covered by OLT andthere is no retention to thelandowner.

Rule 2 Landholding of 24 hectares orless (but above 7 hectares(LOI 46 (ibid) and LOI 227(November 16, 1974) covered byOLT but landowner is entitledto retention except if LOI474 (October 21, 1976)applies.

Rule 3 Landholding of seven (7)hectares or less is EXEMPTEDfrom OLT except if LOI 474 isapplicable under the followingcircumstances:

Landowner owns other

the agricultural productsraised or that can beraised thereon.

PRIORITIES – The DAR, incoordination with the PARCshall plan and program theacquisition and distribution ofall agricultural lands througha period of ten (10) years fromthe effectively of this Act.Land shall be acquired anddistributed as follows:

Phase One: 1.Rice and corn landunder PD 27;2. Idle and abandonedlands

3. Private landsvoluntarily offered bythe owners for agrarian

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Essential Elementsof Tenancy Relationship:

1.The parties are thelandholder and the tenant;

2.The subject isagricultural land;

3.There is consent;4.The purpose is

agricultural production;5.There is personal

cultivation;6.There is sharing of

harvest or payment ofrentals. (Caballes vs.DAR, 168 SCRA 247; Qua vs.Court of Appeals, 198 SCRA247.)

VI - RETENTION

agricultural land of morethan seven hectares inaggregate area, or he ownsCOMMERCIAL, INDUSTRIAL,RESIDENTIAL or URBAN LANDwhere he derive an adequateincome, DAR Memo, CircularNo. 11, s. 1978 (April 21,1978) Adequate income is atleast FIVE THOUSAND(P5000.00) PESOS per annum.(Gross Income).

Lands not covered byPresidential Decree No. 27.

1. Private agricultural landswhich are NOT PRIMARILYDEVOTED TO RICE OR CORN, or

2. There is NO SYSTEM OF SHARECROP OR LEASE TENANCY

reform;4. Foreclosed land bygovernment financialinstitutions;

5. Land acquired by thePresidential Commissionon Good Government; and

6. All other lands ownedby the Governmentdevoted to or suitablefor agriculture

These shall beacquired and distributedimmediately uponeffectivity of the Act,with the implementationto be completed within aperiod of not more thanfour (4) years (Sec. 7,par. 2, RA 6657)

Phase Two:

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In Leasehold Tenancy,the Landowner or agriculturallessor RETAIN OWNERSHIP of thesubject landholding.

The landowner EXERCISESthe ATTRIBUTED OF OWNERSHIP.Under Art. 428 of the New CivilCode. The OWNER has the RIGHT TODISPOSE OF a thing without otherlimitation than those imposed bylaw. As an incident of ownership,Therefore, there is nothing toprevent a landowner from DONATINGhis NAKED TITLE TO THE LAND.However, the new owner MUSTRESPECT THE RIGHT OF THE TENANT.

The agriculturalleasehold relation under thisCode shall not be extinguishedby MERE EXPIRATION OF THE TERM

obtaining in thelandholding. (Daez, vs. CA,IBID).

*The REQUISITES for theexercise by the landowner ofhis RIGHT OF RETENTION are thefollowing:

1.The land must be DEVOTED TORICE OR CORN CROPS;

2.There must be a system ofshare-crop or lease tenancyobtaining there.

3.The size of the landholdingMUST NOT EXCEED TWENTY FOUR(24) hectares provided thatat least seven (7) hectaresthereof are covered landsand more than seven (7)hectares of it consist of

1.All Disposable andalienable publicagricultural lands;

2.All Arable publicagricultural landsunder agro-forest,pasture andagricultural leasesalready cultivated andplanted for crops inaccordance with Sec.6, Art. XIII of theConstitution;

3.All publicagricultural landswhich are opened fornew development andresettlement; and

4.All privateagricultural lands inexcess of fifty (50)hectares

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OR PERIOD in a leaseholdcontract nor by the SALE,ALIENATION OR TRANSFER of thelegal possession of thelandholding. In case theagricultural lessor SELLS,ALIENATES, OR TRANSFER thelegal possession of thelandholding, the PURCHASER ORTRANSFEREE thereof shall besubrogated to the right andsubstituted to the obligationsof the agricultural lessor(see. 10, RA 3844)

VII - BENEFICIARIES

The beneficiaries underRepublic Act No. 1199, RepublicAct No. 3844 as amended byRepublic Act No. 6389 areSHARE-TENANT OR AGRICULTURAL

“other agricultural lands.”Daez vs. CA, Ibid)

Right of Retention by Landownersunder Presidential Decree No. 27.Supplemental Guideline A.O. No.04, Series of 1991).

The policy statements areas follows:

a. Landowners covered by PD27 are entitled to retainSEVEN hectares, except thosewhose entire tenanted riceand corn lands are subjectto acquisition anddistribution under OLT.

AN OWNER MAY NOT RETAIN

These shall bedistributed immediatelyupon the effectivity ofthe Act, with theimplementation to becompleted within a periodof not more than four (4)years.

Phase Three: All privateAGRICULTURAL LANDScommencing with LARGElandholdings andproceeding to MEDIUM andSMALL landholding underthe following schedules:a)Landholdings ABOVE 24

hectares up to 50hectares to begin onthe forth year fromeffectivity of this actand to be completed

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LESSEES (TENANTS). Thus:

“In the INTERPRETATIONAND ENFORCEMENT of this Act andother laws as well as of thestipulation between thelandholder and the tenant theCOURTS AND ADMINISTRATIVEOFFICIALS SHALL RESOLVE ALLGRAVE DOUBTS IN FAVOR OF THETENANT. (Sec. 56, Republic actNo. 1199)

VIII - AWARD CEILING

Theshare-tenant/agriculturallessee who is alreadycultivating a landholding withan area of FIVE (5) HECTARES ormore or of sufficient size tomake him and member of his

UNDER THE FOLLOWING CASES:

a)If he as of October 21,1972 owned more than 24hectares of tenanted riceor corn lands; or

b)By virtue of LOI 474, ifhe as of 21 October 1972owns less than 24 hectaresof tenanted rice butadditionally owned thefollows =

Other agriculturalland of more thanseven hectares,whether tenanted ornot, whethercultivated or not, andregardless of theincome derivedtherefrom; or

Land use for

within three years;and,

b)Landholdings from theRETENTION LIMIT up to24 hectares, to beginon the sixth year fromeffectivity of this Actand to be completedwithin four year.

LANDS NOT COVERED BY CARP

1. Those which are notsuitable for agriculture orthose which are classifiedas mineral, forestresidential, commercial orindustrial lands. (Sec. 3.©, RA 6657);

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immediate farm household fullyoccupied in its cultivation isprohibited to CONTRACT TO WORKat the same time two or moreseparated holding belonging todifferent landholder WITHOUTTHE KNOWLEDGE AND CONSENT OFTHE LANDOWNER/AGRICULTURALLESSOR (Par. I, Sec. 24,Republic Act. No. 1199)

IX - PAYMENT FOR THE COST OF THELAND.

In the exercise of RIGHTOF PRE-EMPTION by theagricultural lessee-tenant, hemust EITHER TENDER PAYMENT OF,OR PRESENT A CERTIFICATE FROMTHE LBP that it shall makepayment under Section 80 ofRepublic Act No. 3844 (10% CASH

commercial,industrial,residential or otherurban purposes, fromwhich he derivesadequate income tosupport himself andhis family

b. Landowners who filedtheir application forretention BEFORE 27 August1985, the deadline set byAdministrative Order No.1, Series of 1985, mayretain not more than sevenhectares of theirlandholding covered by PD27 regardless of whetheror not they complied withLOI Nos. 41, 45, and 52.Landowners who filed

their application AFTER 27

2. Those which have beenclassified and approved asNON-AGRICLTURAL prior toJune 15, 1988. (DOJ OpinionNo. 44, S. 1990)

3. Those which are EXEMPTpursuant to Sec. 10, RA6657.

4. Those which are devotedto poultry, swine orlivestock-raising as ofJune 15, 1988 pursuant tothe Supreme Court ruling onLuz. Farms vs. The Hon.Secretary of AgrarianReform (192 SCRA 51);

5. Fishponds and prawn farmsexempted pursuant to R.A.No. 7881, and its

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and 90% in six percent, taxfree, redeemable bonds issuedby the LBP.) If the landownerrefuses to accept TENDER orPRESENTMENT, the agriculturallessee may CONSIGN it in COURT,(Sec. 11, Republic Act No. 3844as amended by Republic Act No.6389.

The REDEMPTION PRICEshall be, the REASONABLE PRICEOF THE LAND at the time ofsale. (Sec. 12, Republic ActNo. 3844 as amended by RepublicAct No. 6389)

X -TRANSFERABILITY OF LANDHOLDING

1.Sale, Alienation orTransfer of the legalpossession of the

August 1985 but compliedwith the requirement ofLOI No. 41, 45 and 52shall likewise be entitledto such a seven hectaresretention area.However landowner who

filed their applicationfor retention AFTER the 27August 1985 deadline andDID NOT COMPLY with therequirements of LOI Nos.41, 45, and 52 shall onlybe entitled to a maximumof five (5) hectares asretention area.

c. A landowner WHO HAS DIEDmust have manifestedduring his lifetime hisintention to exercise hisright of retention prior

implementing AdministrativeOrder No. 3, Series of1995;

6. Those which are retainedby the landowners;

7. Those lands or portionsthereof under the coverageof EO 407 but found to beno longer suitable foragriculture and therefore,could not be givenappropriate valuation bythe LBP as determined byDAR/LBP; and

8. Those lands declared byPresidential Proclamationsfor certain uses other thanagricultural.

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landholding. 2.Extinguishment of

Agricultural LeaseholdRelations (Sec. 8, RA3844)

A. ABANDONMENT of thelandholding without theknowledge of the agriculturallessor. (Teodoro vs.Macaraeg, 27 SCRA 7 (1969) Toconstitute abandonment theremust be an absoluterelinquishment of thepremises of the tenant. This"overt act" must be coupledwith his intention to do so"which is carried intoeffect," (Philippine Laborand Social Legislation,Martin, 70 Ed. Pp. 405-406).Abandonment to validlyterminate tenancy

to 23 AUGUST 1990 (Thefinality of the SupremeCourt decision in the case"Association of SmallLandowners of thePhilippines, Inc. et al.vs. Honorable Secretary ofAgrarian Reform) to allowhis heirs to now exercisesuch right under theseGuidelines. Said heirsmust show proof of theoriginal landownersintention. The heirs may alsoexercise the originallandowners' right ofretention if they canprove that the decedentHAD NO KNOWLEDGE of OLTcoverage over the subjectproperty.

Rules and Procedures Governingthe Exercise of Retention Rightsby Landowners and Award toChildren under Sec. 6 of RA 6657(A.O. No. 11, Series of 1990; andA.O. No. 2, S. 2003)

A.Landowners whose landholdingare covered by CARP mayretain an area of FIVE (5)hectares.

In addition, each of hischildren, (legitimate,illegitimate or adopted maybe AWARDED three (3)hectares as PREFERREDBENEFICIARY provided-

1. That the childwas at least 15 years ofage on the June 15, 1988(RA 6657-effectivity);and

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relationship is characterizedby:

(a) an INTENT toABANDON, and (b) an OVERT ACT to

carry out suchintention

There must be, therefore, NOANIMUS REVERTENDI on the partof the tenant (Labor,Agrarian and SocialLegislation, Montemayor, 2ndEd., 1968, pp. 54-55)

B. VOLUNTARY SURRENDER ofthe landholding by theagricultural lessee,written notice of whichshall be served threemonths in advance

The BENEFICIARIES ofPresidential Decree No. 27 areTENANT-FARMERS, thus:

“This shall apply toTENANT-FARMERS of PRIVATEAGRICULTURAL LANDS PRIMARILYDEVOTED TO RICE OR CORNunder a SYSTEM OF SHARE-CROPor LEASE-TENANCY, whetherclassified as landed estateor not. (Par. 5,Presidential Decree No. 27).

“The tenant-farmers,whether in land classifiedas landed estate or notshall be DEEMED OWNER of aportion constituting offamily-size farm of FIVE (5)

2. The child wasactually tilling theland or directlymanaging the farmlandfrom June 15, 1988 tothe filing of theapplication forretention and/or at thetime of acquisition ofthe land under CARP.

Retention of husband andwife:

1. For marriages coveredby the New Civil Code,the spouses who ownsonly CONJUGAL PROPERTIESmay retain a total offive (5) hectares unlessthere is an agreementfor the JUDICIAL

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(Nisnisan, et al., vs.CA, 294 SCRA 173 (1998). As a mode ofextinguishing tenancyrelationship it connotesa decision in the part ofthe tenant to return thepossession of thelandholding andrelinquished his right astenant thereonuninfluenced by anycompelling factor, comingparticularly from thelandholder. For surrenderto be valid, there mustbe (a) an intention toabandon, and (b) anexternal act or anomission to act, by whichsuch intention is carriedout into effect. When a

hectares if not irrigatedand THREE (3) HECTARES IFIRRIGATED. (Par. 6,Presidential Decree No. 27)

The tenant shall pay for THECOST OF THE LAND, includinginterest of six (6) percentper annum in FIFTEEN (15)YEARS of fifteen (15) equalannual amortizations.

NOTE: The period inextended to twenty (20)years equal annualamortization under Sec. 6,E.O.. 228 of July 17, 1987by Pres. Corazon C.Aquino.

The TITLE to the landowned by the tenant shallnot be transferable except

SEPERATION OFPROPERTIES. However, ifeither or both of themare landowners in theirrespective rights(capital and/orparaphernal) they mayretain not more thanfive (5) hectares eachfrom their respectivelandholdings. In nocase, however, shall thetotal retention of sucha couple exceed 10hectares, and

2. For marriage covered bythe New Family Code(August 3, 1988), ahusband owning capitalproperty and/or a wifeowning paraphernalproperty may retain not

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tenant voluntarily yieldsthe land, he terminatesthe tenancy relationshipby his unilateral act.(Anacleto Inson vs.Planas de Asis, et.al.,CA GR No. Sp-01769,October 11, 1974.)

NOTE: SUBLEASING by theagricultural lessee is also aground for the extinguishmentsof Agricultural LeaseholdRelations. (Par.(2), Sec. 27,Republic Act No. 3844).

XI - EVIDENCE OF RIGHT/TITLE OVERTHE LANDHOLDING.

AGRICUTLURAL LEASEHOLDCONTRACT IN GENERAL.-

BY HEREDITARY SUCCESSION orTO THE GOVERNMENT inaccordance with this Decree,the Code of Agrarian Reformand other existing laws andregulation.

NOTE: Sec. 6, EO 228provides, “Ownership oflands acquired by farmer-beneficiary may betransferred after fullpayment of amortization.

The EMANCIPATION PATENT.Awarded to the TENANT-BENEFICIARY CREATES a VESTEDRIGHT OF ABSOLUTE OWNERSHIP inthe landholding – “a rightwhich has become fixed andestablished and is no longeropen to doubt or controversy.“ (Pagtalunan vs. Tamayo, 183

more than five (5)hectares each providedthey execute a JUDICIALSPERATION OF PROPERTIESprior to entering themarriage. In the absenceof such an agreement allproperties (capital,paraphernal andconjugal) shall beconsidered held inabsolute community.

QUALIFIED BENEFICIARIES.- Thelands covered by the CARPshall be distributed as much apossible to landless residentsof the same barangay, or inthe absence thereof, landlessresident of the samemunicipality in the followingorder of priority:

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- The agricultural lessorand the agricultural lesseeshall be FREE to ENTER intoany kind of TERMS, CONDITIONSor STIPULATIONS in aLEASEHOLD CONTRACT as long asthey are not contrary to LAW,MORALS OR PUBLIC POLICY.(Sec. 15 Republic Act No.3844).

Except in case ofmistake, violence,intimidation, undueinfluence, or fraud, anAGRICULTURAL CONTRACT reducedin writing and registered ashereinafter provided, SHALLBE CONCLUSIVE BETWEEN THECONTRACTING PARTIES, if notDENOUNCED OR IMPUGNED WITHINTHIRTY DAYS AFTER

SCRA 252)

The Mode of Transfer of landsTenant-Beneficiaries underPresidential Decree No. 27 arethe following:

1.OPERATION LAND TRANSFER(OLT) under PD 27 and EO228; and

Operation LandTransfer is the ORDERLY andSYSTEMATIC TRANSFER of landfrom the landowner to thetenant-farmer underPresidential Decree No. 27.

2. DIRECT PAYMENT SCHEME(DPS). – The landowner andthe tenant-beneficiary canAGREE on the DIRECT SALE

a)agricultural lessees andshare tenants;

b)regular farmworkers;c)seasonal farmworkers;d)other farmworkers;e)actual tillers or

occupants of publiclands;

f)collectives orcooperatives of the abovebeneficiaries; and

g)others directly workingon the land.(Par. 1, Sec. 22, RA6657)

The children of landowners whoare qualified under Sec. 6 ofthis Act shall be givenpreference in the distributionof the land of their parents;

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REGISTRATION (Sec. 17,Republic Act No. 3844)

XII - MODES OF TRANSFER OF THELAND TO THE TENANT ORBENEFICIARY

The landowner-agricultural lessor canFREELY AND VOLUNTARILYTRANSFER the landholding tothe agricultural lessor byway of:

1.Sale2.Donation3.Succession – the

agricultural lessee asDEVISEE to the testator’sfree portion in the will.

terms and conditions whichis not onerous to thetenant-beneficiary.

The value if theland shall equivalent to twoand one half (2-1/2) timesthe AVERAGE HARVEST OF THREENORMAL CROP YEARSIMMEDIATELY PRECEDING THEPROMULGATION OF THIS DEGREE.

And, further, that actualtenant-tillers in thelandholding shall be ejectedor removed therefrom. (Par. 2,Sec.22, RA 6657).

“Distribution Limit – Noqualified beneficiary may ownmore than Three (3) hectares ofagricultural land” (Sec. 23, RA6657)

“Award Ceiling forBeneficiaries. – Beneficiariesshall be awarded an area NOTEXCEEDING THREE (3) HECTARESwhich may cover a CONTIGUOUStract of land or SEVERAL PARCELSof land cumulated up to theprescribed award limits.” (Sec.25, RA 6657).

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However, the limitationimposed by law on his rightto acquired must be observed,i.e. Legal prohibition onthe acquisition of property

By operation of law,the agricultural-lessee canacquired ownership of thesubject landholding by theexercise of the followingrights.

1.Right of Pre-Emption; and2.Right of Redemption

XIII - CONSIDERATION FOR THE USEOF VALUE OF THE LAND.

Consideration for theLease of Agricultural lands:

Payment by Beneficiaries.-Lands awarded pursuant to thisAct shall be paid for thebeneficiaries to the LBP inthirty (30) annual amortizationsat six percent (6%) per annum.The payments for the first three(3) years after the award may beat reduced amounts as establishedby the PARC: Provided, That thefirst five (5) annual paymentsmay not be more than five percent(5%) of the value of the annualgross production as establishedby the DAR. Should the scheduledannual payments after the fifthyear exceed ten percent (10%) ofthe annual gross production andthe failure to produceaccordingly is not due to thebeneficiary’s fault, the LBP mayreduce the interest rate or

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1. Not more than 25 per centumof the average normal harvestduring the three agriculturalyears immediately preceding thedate the leasehold wasestablished.

2. Deductible items a. Seedlingsb. Cost of Harvesting c. Cost of Threshing d. Cost of Loadinge. Cost of Hauling f. Cost of Processing

3. If the land is cultivatedfor a period of less than threeyears, the initial considerationis based on the average normalharvest during the preceedingyears when the land was actually

reduce the principal obligationto make the repayment affordable.

The LBP shall have a lienby way of mortgage on the landawarded to the beneficiary; andthis mortgage may be foreclosedby the LBP for non-payment of anaggregate of three (3) annualamortizations. The LBP shalladvise the DAR of suchproceedings and the latter shallsubsequently award the forfeitedlandholding to other qualifiedbeneficiaries. A beneficiarywhose land, as provided herein,has been foreclosed shallthereafter be permanentlydisqualified from becoming abeneficiary under this Act.(Sec.26, RA 6657).

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cultivated or on the harvest ofthe first year if newlycultivated, and the harvest isnormal.

4. After the lapse of thefirst three normal harvest, thefinal consideration shall bebased on the average normalharvest during these threepreceding agricultural years.

5. In the absence of any

agreement as to the rental, themaximum allowed shall be applied.

6. If Capital Improvement isintroduced not by the lessee toincrease productivity, therentals shall be increasedproportionally to the consequentincrease in production due to the

Transferability of AwardedLands.- lands acquired bybeneficiaries under this Act maynot be sold, transferred orconveyed except throughhereditary succession, or to thegovernment, or to the LBP, or toother qualified beneficiaries fora period of ten (10) years;Provided, however, That thechildren or the spouse of thetransferor shall have a right torepurchase the land from thegovernment or LBP within theperiod of two (2) years. Duenotice of the availability of theland shall be given by the LBP tohe Barangay Agrarian ReformCommittee (BARC) of the barangaywhere the land is situated. TheProvincial Agrarian Reform

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improvement.

7. In case of Disagreement theCourt shall determine thereasonably increase in rental.

8. Capital improvement refersto any permanent and tangibleimprovement on the land that willresult in increased productivity.If done with the consent of thelessee, then the lease rentalshall be increasedproportionately.

Coordinating Committee (PARCCOM),as herein provided, shall, inturn, be given due notice thereofby the BARC.

If the land has not yetbeen fully paid by thebeneficiary, the rights to theland may be transferred orconveyed, with prior approval ofthe DAR, to any heir of thebeneficiary or to any otherbeneficiary who, as a conditionfor such transfer or conveyance,shall cultivate the landhimself. Failing complianceherewith, the land shall betransferred to the LBP whichshall give due notice of theavailability of the land in themanner specified in theimmediately preceding paragraph.

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In the event of suchtransfer to the LBP, the lattershall compensate the beneficiaryin one lump sum for the amountsthe latter has already paid,together with the value ofimprovements he has made on theland.(Sec. 27, RA 6657).

The TITLES awarded tofarmer-beneficiaries CARP arethe following:

1.Free Patent for PublicAlienation and Disposablelands;

2.CERTIFICATE OF LANDOWNERSHIP AWARD (CLOA) forResettlement sites:

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3.STEWARDSHIP CONTRACT forLands covered by INTERGRATEDSOCIAL FORESTRY PROGRAM(ISFP); and

4.CLOA for Private ofAgricultural Lands.

The MODES OF ACQUIRING LANDSfor distribution under CARP:

a. COMPULSORY ACQUISITION(CA) (Sec. 16, RA 6657)

b. VOLUNTARY OFFER TO SELL(VOS) (Sec. 19, RA 6657)

c. VOLUNTARY LANDTRANFER/DIRECT PAYMENTSCHEME (VLT/DPS) (Sec. 20,RA 6657).

Factors/Criteria considered in

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determining just compensation:

1. Cost of Acquisition ofthe land;

2. Current Value of likeproperties;

3. Nature of the land; 4. Actual use;

5. Income; 6. Sworn valuation by thelandowner; 7. Tax Declaration; 8. Assessment made by

government assessors; 9. The social and economicbenefits

contributed by thefarmers, and

10.Non-payment of taxes orloans secured from anygovernment financinginstitution on the land.

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Basic Formula for the valuationof lands covered by VOS and CA –

LV = (CNI x 0.6) + (CSx 0.3) +

(MV x 0.1)

where:LV = Land Value CNI = Capitalized Net

IncomeCS = Comparable Sales

MV = Market Valueper Tax Declaration

The above formula shall beused if all three factors are present, relevant andapplicable.

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A.1. When the CS factor isnot present and CNI and MV are applicable, theformula shall be:

LV = (CNI x 0.9) + (MV x 0.1)

A.2. When the CNI factoris not present and CS and MV are applicable, theformula shall be:

LV = (CS x 0.9) + (MV x 0.1)

A.3. When both CS and CNIare not present and only MV isapplicable, the formula shall be;

LV = (MV x 2)

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