Clerk of Court: The Honorable the Chief Justice and the Assoc.

Justices of the Supreme Court of the Philippines.

[Gavel]

Chief Justices: Prayers please.

[Ecumenical Prayer of the Court]

CJ: You may now be seated. Clerk of Court please call the case.

CC: Your Honor scheduled for today’s oral argument is the case entitled HACIENDA LUISITA, INCORPORATED,
Petitioner, LUISITA INDUSTRIAL PARK CORPORATION and RIZAL COMMERCIAL BANKING
CORPORATION, Petitioners-in-Intervention, - versus - PRESIDENTIAL AGRARIAN REFORM COUNCIL;
SECRETARY NASSER PANGANDAMAN OF THE DEPARTMENT OF AGRARIAN REFORM; ALYANSA NG
MGA MANGGAGAWANG BUKID NG HACIENDA LUISITA, RENE GALANG, NOEL MALLARI, and JULIO
SUNIGA[1] and his SUPERVISORY GROUP OF THE HACIENDA LUISITA, INC. and WINDSOR ANDAYA,
Respondents.

This is a Petition for Certiorari and Prohibition under Rule 65 with prayer for preliminary injunctive relief, petitioner
Hacienda Luisita, Inc. (HLI) assails and seeks to set aside PARC Resolution No. 2005-32-01[16] and Resolution No.
2006-34-01[17] issued on December 22, 2005 and May 3, 2006, respectively, as well as the implementing Notice of
Coverage dated January 2, 2006

CJ: Appearances please.

[Appearances of Lawyers of both Petitioner and Respondent]

CJ: In order to expedite the proceedings, I call the Clerk of Court to read the antecedents of this case.

CC: In 1958, the Spanish owners of Compañia General de Tabacos de Filipinas (Tabacalera) sold Hacienda Luisita
and the Central Azucarera de Tarlac, the sugar mill of the hacienda, to the Tarlac Development Corporation (Tadeco),
then owned and controlled by the Jose Cojuangco Sr. Group. The Central Bank of the Philippines assisted Tadeco in
obtaining a dollar loan from a US bank. Also, the GSIS extended a PhP5.911 million loan in favor of Tadeco to pay
the peso price component of the sale, with the condition that “the lots comprising the Hacienda Luisita be subdivided
by the applicant-corporation and sold at cost to the tenants, should there be any, and whenever conditions should
exist warranting such action under the provisions of the Land Tenure Act.” Tadeco allegedly however did not comply
with this condition.

On May 7, 1980, the martial law administration filed a suit before the Manila RTC against Tadeco, et al., for
them to surrender Hacienda Luisita to the then Ministry of Agrarian Reform (MAR) so that the land can be distributed
to farmers at cost. Responding, Tadeco alleged that Hacienda Luisita does not have tenants, besides which sugar lands
– of which the hacienda consisted – are not covered by existing agrarian reform legislations. The Manila RTC rendered
judgment ordering Tadeco to surrender Hacienda Luisita to the MAR. Therefrom, Tadeco appealed to the CA.

On March 17, 1988, during the administration of President Corazon Cojuangco Aquino, the Office of the
Solicitor General moved to withdraw the government’s case against Tadeco, et al. The CA dismissed the case, subject
to the PARC’s approval of Tadeco’s proposed stock distribution plan (SDP) in favor of its farmworkers. [Under EO
229 and later RA 6657, Tadeco had the option of availing stock distribution as an alternative modality to actual land
transfer to the farmworkers.] On August 23, 1988, Tadeco organized a spin-off corporation, herein petitioner HLI, as
vehicle to facilitate stock acquisition by the farmworkers. For this purpose, Tadeco conveyed to HLI the agricultural
land portion (4,915.75 hectares) and other farm-related properties of Hacienda Luisita in exchange for HLI shares of
stock.
 On May 9, 1989, some 93% of the then farmworker-beneficiaries (FWBs) complement of Hacienda Luisita
signified in a referendum their acceptance of the proposed HLI’s Stock Distribution Option Plan (SODP). On May
11, 1989, the SDOA was formally entered into by Tadeco, HLI, and the 5,848 qualified FWBs. This attested to by
then DAR Secretary Philip Juico. The SDOA embodied the basis and mechanics of HLI’s SDP, which was eventually
approved by the PARC after a follow-up referendum conducted by the DAR on October 14, 1989, in which 5,117
FWBs, out of 5,315 who participated, opted to receive shares in HLI.

On August 15, 1995, HLI applied for the conversion of 500 hectares of land of the hacienda from agricultural
to industrial use, pursuant to Sec. 65 of RA 6657. The DAR approved the application on August 14, 1996, subject to
payment of three percent (3%) of the gross selling price to the FWBs and to HLI’s continued compliance with its
undertakings under the SDP, among other conditions.

On December 13, 1996, HLI, in exchange for subscription of 12,000,000 shares of stocks of Centennary
Holdings, Inc. (Centennary), ceded 300 hectares of the converted area to the latter. Subsequently, Centennary sold the
entire 300 hectares for PhP750 million to Luisita Industrial Park Corporation (LIPCO), which used it in developing
an industrial complex. From this area was carved out 2 parcels, for which 2 separate titles were issued in the name of
LIPCO. Later, LIPCO transferred these 2 parcels to the Rizal Commercial Banking Corporation (RCBC) in payment
of LIPCO’s PhP431,695,732.10 loan obligations to RCBC. LIPCO’s titles were cancelled and new ones were issued
to RCBC. Apart from the 500 hectares, another 80.51 hectares were later detached from Hacienda Luisita and acquired
by the government as part of the Subic-Clark-Tarlac Expressway (SCTEX) complex. Thus, 4,335.75 hectares
remained of the original 4,915 hectares Tadeco ceded to HLI.

Such, was the state of things when two separate petitions reached the DAR in the latter part of 2003. The first
was filed by the Supervisory Group of HLI (Supervisory Group), praying for a renegotiation of the SDOA, or, in the
alternative, its revocation. The second petition, praying for the revocation and nullification of the SDOA and the
distribution of the lands in the hacienda, was filed by Alyansa ng mga Manggagawang Bukid ng Hacienda
Luisita (AMBALA). The DAR then constituted a Special Task Force (STF) to attend to issues relating to the SDP of
HLI. After investigation and evaluation, the STF found that HLI has not complied with its obligations under RA 6657
despite the implementation of the SDP. On December 22, 2005, the PARC issued the assailed Resolution No. 2005-
32-01, recalling/revoking the SDO plan of Tadeco/HLI. It further resolved that the subject lands be forthwith placed
under the compulsory coverage or mandated land acquisition scheme of the CARP.

From the foregoing resolution, HLI sought reconsideration. Its motion notwithstanding, HLI also filed a petition before
the Supreme Court in light of what it considers as the DAR’s hasty placing of Hacienda Luisita under CARP even
before PARC could rule or even read the motion for reconsideration. PARC would eventually deny HLI’s motion for
reconsideration via Resolution No. 2006-34-01 dated May 3, 2006.

CJ: Thank you. Alright we will start with the petitioner's side. Atty. _______ you may now approach the podium.

Petitioner: Petitioner come before this court…….

CJ: Justice _____________

Petitioner:

1. Counsel for the Petitioner, in your understanding, what is the essence of Agrarian Reform?
2. Therefore, it can be culled from your submission that the matter you bring before us is imbued with public
interest, is it not?
3. So in resolving this issue, we should address the controversy in the lens of agrarian reform being a matter
which necessarily involves matters of public concern as against ruling the matter merely as a private or
corporate dispute correct?
4. What are the elements of a valid contract? If those are adhered to, what is the effect?
5. Would you consider SBOA a contract? In that contract how did you defined qualified beneficiaries
6. Following your definition, is Galang is farmworker? does he appear in the annual payroll inclusive of the
permanent and seasonal employees?
7. Even assuming that members of the Supervisory Group are not regular farmworkers, but are in the category
of “other farmworkers” mentioned in Sec. 4, Article XIII of the Constitution, thus only entitled to a share of
the fruits of the land, as indeed Fortich teaches, this does not detract from the fact that they are still identified
as being among the “SDP qualified beneficiaries.”
8. We therefore conclude that Galang et. al are certainly parties who would benefit or be prejudiced by the
judgment recalling the SDP or replacing it with some other modality to comply with RA 6657
9. Is it the petitioners position that the issue on the compliance of HLI with respect to the SDP can be addressed
without discussing the constitutionality of sec 31 of RA 6657?
10. Hence the matter before us does not necessarily hinge on the said provision but rather on the compliance or
non-compliance of HLI in its obligation under the SDP, correct?

Respondent

1. Counsel, can there be an implied jurisdiction in so far as issuance of licenses or the like is concerned?
2. What is the doctrine of necessary implication?
3. So it is your submission that the authority of PARC which includes the authority to approve the plan for stock
distribution of the corporate landowner necessarily includes the right to revoke the same and hence acquire
the jurisdiction over cases arising therefrom
4. What is your legal basis in saying that
5. What is the nature of this case?
6. Is it not correct to say that this case, which partakes of an agrarian dispute and not a corporate one?

We now tackle the issue of constitutionality of Section 31 of RA 6657. We have discussed the matters with respect to
the standing of herein respondents. We now proceed to the other elements of Judicial Review.

1. From the perusal of evidence, the SDP was approved by PARC on Nov. 21. 1989 is that not correct?
2. And FARM challenged the constitutionality of the same only in May 3, 2007, correct
3. So, is it not correct to say that FARM have slept on their rights and even accepted the benefits of SDP during
those 18 years?
4. Therefore, we can conclude that the second element of judicial review, that the controversy must be raised at
the earliest possible opportunity is wanting?
5. You invoke this court’s power on judicial review with respect to the issue that PARC acted with
GRADALEJ?
6. And you submit that PARC acted in grave abuse of discretion when it ordered the recall of the SDP for such
non-compliance and the fact that the SDP, as couched and implemented, offends certain constitutional and
statutory provisions
Clerk of Court: The Honorable the Chief Justice and the Assoc. Justices of the Supreme Court of the Philippines.
Here ye! here ye! here ye! All persons having business before the Honorable Supreme Court of the Phil shall give
their attention for the court its now in session.

[Gavel]

Chief Justices: Prayers please.

[Ecumenical Prayer of the Court]

CJ: You may now be seated. Clerk of Court please call the case.

CC: Your Honor scheduled for today’s oral argument is the case entitled ROXAS & CO., INC., petitioner, vs. THE
HONORABLE COURT OF APPEALS, DEPARTMENT OF AGRARIAN REFORM, SECRETARY OF
AGRARIAN REFORM, DAR REGIONAL DIRECTOR FOR REGION IV, MUNICIPAL AGRARIAN REFORM
OFFICER OF NASUGBU, BATANGAS and DEPARTMENT OF AGRARIAN REFORM ADJUDICATION
BOARD, respondents.

CJ: Appearances please.

[Appearances of Lawyers of both Petitioner and Respondent]

CJ: In order to expedite the proceedings, I call the Clerk of Court to read the antecedents of this case.

CC: This case involves three (3) haciendas in Nasugbu, Batangas owned by petitioner Roxas & Co and the validity
of the acquisition of these haciendas by the government under Republic Act No. 6657, the Comprehensive Agrarian
Reform Law of 1988 (CARL).

Before the law's effectivity, on May 6, 1988, petitioner filed with the Department of Agrarian Reform (DAR) a
voluntary offer to sell Hacienda Caylaway pursuant to the provisions of E.O. No. 229. Haciendas Palico and Banilad
were later placed under compulsory acquisition by DAR in accordance with the CARL.

On December 12, 1989, DAR sent a "Notice of Acquisition" to petitioner over Hacienda Palico and Hacienda Banilad.
Meanwhile, in a letter dated May 4, 1993, petitioner applied with the DAR for conversion of Haciendas Palico and
hacienda Banilad from agricultural to non-agricultural lands under the provisions of the CARL.

Despite petitioner's application for conversion, DAR proceeded with the acquisition of the two Haciendas. The
(Landbank) LBP trust accounts as compensation for Hacienda Palico were replaced with cash and LBP bonds.
Certificates of Land Ownership Award (CLOAs) were distributed to farmer beneficiaries.

Hacienda Caylaway was voluntarily offered for sale to the government on May 6, 1988 before the effectivity of the
CARL.. DAR sent to petitioner two (2) separate Resolutions accepting the voluntary offer to sell (VOS). However,
the DAR later sent to petitioner a "Notice of Acquisition"

Petitioner sent a letter to the DAR Secretary withdrawing its VOS of Hacienda Caylaway. The Sangguniang Bayan of
Nasugbu, Batangas allegedly authorized the reclassification of Hacienda Caylaway from agricultural to non-
agricultural.

The DAR Secretary informed petitioner that a reclassification of the land would not exempt it from agrarian reform,
and also denied petitioner's withdrawal of the VOS on the ground that withdrawal could only be based on specific
grounds.

Petitioner instituted a case with the DAR Adjudication Board (DARAB) praying for the cancellation of the CLOA's
issued by DAR. Petitioner alleged that the Municipality of Nasugbu had been declared a tourist zone, that the land is
not suitable for agricultural production, and that the Sangguniang Bayan of | Page 2 of 5 Nasugbu had reclassified the
land to non-agricultural. DARAB held that the case involved the prejudicial question of whether the property was
subject to agrarian reform, hence, this question should be submitted to the Office of the Secretary of Agrarian Reform.

Petitioner filed a petition with the Court of Appeals questioning the expropriation of its properties under the CARL.
The petition was dismissed. Hence, the present recourse to the Supreme Court. Meanwhile, the petition for conversion
of the three haciendas was denied by the MARO.

CJ: Thank you. Alright we will start with the petitioner's side. Atty. _______ you may now approach the podium.

Petitioner: Petitioner come before this court…….

CJ: Justice _____________

Justice 1: Interpolation.... Procedural issues.