February 9, 1999

DAR OPINION NO. 09-99

HON . CONRADO S. NAVARRO

Undersecretary

Field Operations Group and Support Services

This Department

Dear Undersecretary Navarro:

This refers to your Memorandum dated 28 December 1998, requesting opinion on the issue of whether or not the Land Bank of the Philippines has the authority to withhold the issuance of Certificate of Cash Deposit of properties with pending protests on coverage and exemption or conversion applications filed by the landowners until the same is resolved with finality.

The instant query was raised in view of the numerous reports and complaints you have been receiving due to the LBP's decision to withhold the issuance of Certificate of Cash Deposit, in consonance with Step 25 of the Joint DAR-LBP Memorandum Circular No. 4, Series of 1995. Under the said Memorandum Circular, if the landowner protests the coverage of his landholdings, the course of action to be taken is to advise the Regional Director of the Protest and the Land Bank of the Philippines may hold in abeyance the issuance of Certificate of Trust Deposit (now Certificate of Cash Deposit) until otherwise ordered by the Regional Director.

Relative to the above, Section 16 (e) of R.A. No. 6657 provides, quote:

"Section 16.   Procedure for Acquisition of Private Lands. — . . .

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(e)     Upon receipt by the landowner of the corresponding payment or, in case of rejection or no response from the landowner, upon the deposit with an accessible bank designated by the DAR of the compensation in cash of in LBP bonds in accordance with this Act, the DAR shall take immediate possession of the land and shall request the proper Register of Deeds to issue a Transfer Certificate of Title (TCT) in the name of the Republic of the Philippines. The DAR shall thereafter proceed with the redistribution of the land to the qualified beneficiaries.

The aforequoted provision of law presupposes that there is no issue raised on the coverage, exemption and/or conversion of the subject landholding, thus, a Certificate of Cash Deposit could be issued and the land may be immediately subjected to CARP coverage. Conversely, in case there is a pending protest on coverage or an exemption/conversion application filed by the landowner, it necessarily follows that the issuance of the Cash Deposit Certification should be held in abeyance, hence, the landholding in issue could not be immediately subjected to CARP coverage.

Should the certificate of cash deposit be issued pending the protest on coverage or exemption/conversion application, the property subject of the protest may later be resolved in favor of the landowner. The entire CARP coverage process would therefore be put to naught and the cash deposit certificate eventually cancelled. The end result would be a waste of time, effort and resources, hence, Step 25 of the Joint DAR-LBP Memorandum Circular No. 4, Series of 1995 came into effect to foreclose said possible wastage. It is a basic tenet in statutory construction that contemporaneous interpretation given by administrative officials to a law which they are duty bound to enforce and implement deserves great weight.

Moreover, in connection with the aforegoing, please find attached the undersigned's earlier Memorandum dated 25 November 1998 a portion of which is herein pertinently quoted as follows:

". . . it is deemed wise and prudent to resolve first the pending petition for exemption filed . . . before proceeding to the coverage of the landholding in issue to avoid possible absurdity where the property subject of the request might later on be declared as exempt from CARP coverage. This policy procedure aims to prevent the government from probable wastage of time, effort and resources incident to the coverage. Hence, the coverage process should momentarily be deferred to give way to the resolution of the pending application for exemption/exclusion."

In view of all the foregoing, we submit that in cases where there are pending applications for exemption or conversion or protests on coverage, the issuance of Certificate of Cash Deposit shall be held in abeyance until such time that said applications or protests are resolved with finality. However, in so far as the applications for exemption and conversion and protests involving CARP coverage which are pending with the DAR, it behooves and it is incumbent upon us that the resolution thereof should be directed and rendered the soonest in order that the implementation of the Program shall not be unduly delayed or derailed. Earnest efforts and representations shall likewise be accordingly exerted and made by the Department in cases where said applications or protests are already with the Office of the President or the courts in order that the same shall likewise be resolved the soonest time possible.

Thank you for communicating with us and we hope to have clarified the matter with you.

Very truly yours,

(SGD.) DANILO T. LARA

Undersecretary for Legal Affairs, and Policy and Planning