Lim v. Cruz

 

Lim v. Cruz

G.R. No. 248650

March 15, 2023

 

FACTS:

                The case revolves around a dispute between petitioner Elizabeth Ong Lim and respondent Lazaro N. Cruz. Lazaro had been awarded two parcels of agricultural land in Calumpit, Bulacan by the Department of Agrarian Reform (DAR) in 1994. The first parcel covered an area of 18,865 square meters, while the second parcel covered 11,099 square meters. These lands were covered by Transfer Certificate of Title (TCT) No. 9307/Certificate of Land Ownership Awards (CLOA) No. 00243956 and TCT No. 9308/CLOA No. 00243955, respectively. Within six years of receiving the land award, Lazaro obtained a loan of P1,500,000.00 from petitioner Elizabeth Ong Lim. As security for the loan, Lazaro executed a Real Estate Mortgage over the first parcel of land in favor of petitioner. Subsequently, within eight years of receiving the award, Lazaro executed a Deed of Sale over the second parcel of land in favor of petitioner, amounting to P1,500,000.00. Lazaro also handed over the original copies of the TCTs/CLOAs for both parcels of land to petitioner. Lazaro's son, Vicente T. Cruz, represented him in filing a complaint for annulment of the deed of mortgage, deed of absolute sale, and recovery of possession with damages against petitioner before the Regional Trial Court (RTC). They argued that the transactions violated the restrictions on the transfer of awarded lands under Section 27 of RA 6657. The section prohibits the sale, transfer, or conveyance of such lands for a period of ten years from the award, with limited exceptions.

 

ISSUE:

                Whether or not the sale of the second parcel of land violated the 10-year prohibition stated in Section 27 of RA 6657.

 

HELD:

                Yes. The sale of the second land parcel was void for violating the prohibition in Section 27 of RA 6657. The CA's ruling, deeming the sale void, was upheld as it followed established jurisprudence. Its interpretation was based on the principle that any waiver or transfer of rights over awarded lands within the 10-year prohibitory period is void. This is to uphold the rights and interests of farmer-beneficiaries and promote the overall goals of agrarian reform. The CA's decision aligns with previous cases, such as the Torres v. Ventura case, which declared that the principle of pari delicto (both parties are equally at fault) does not apply in agrarian reform cases. This is because the agrarian reform law aims to liberate the farmers from the bondage of the soil and ensure their rights are upheld. As such, the respondent was entitled to recover the land, and the petitioner was obligated to return the purchase price with legal interest. The petition for review on certiorari was denied, affirming the CA's decision. The case was remanded to the RTC to determine the actual purchase price of the land to be returned by the respondent to the petitioner.