12/05/2026
SUPREME COURT: DARAB JURISDICTION LIMITED TO AGRARIAN DISPUTES, EXCLUDES ORDINARY LOAN TRANSACTIONS
The Supreme Court (SC) ruled that the Department of Agrarian Reform Adjudication Board (DARAB) exercises primary and exclusive jurisdiction only over "agrarian disputes," which require the existence of a tenurial arrangement such as tenancy or leasehold between the parties and do not extend to ordinary loan transactions.
In an 18-page decision penned by Chief Justice Alexander Gesmundo, the SC's First Division reversed the ruling of the Court of Appeals that invalidated the previous decision of the DARAB, as it ruled that DARAB adjudicators had no jurisdiction over the case because the reallocation of land is an administrative matter under the exclusive jurisdiction of the DAR secretary.
The case stemmed from the action filed by Carmelita Mercado for the annulment of the transfer certificate of title emancipation patent No. against the heirs of Serafin De Guzman. The dispute involves an 8,212-square-meter portion of a larger agricultural land covered by the said title, which is registered in the name of the heirs of De Guzman.
Mercado claimed that this portion was erroneously included in De Guzman's title. She relied on a December 20, 1994, decision by the Provincial Agrarian Reform Adjudicator (PARAD), which ordered the segregation of the portion and the generation of an Emancipation Patent in her favor. Mercado argued that this 1994 PARAD decision had already attained finality and was therefore immutable.
The Heirs of De Guzman countered that one of the heirs, Rogelio, merely lent the disputed portion to Mercado to finance the hospitalization of his daughter. They executed a waiver of rights due to an inability to pay the loan, but the heirs maintained that they had fully paid the land amortization to the Land Bank of the Philippines.
The Regional Agrarian Reform Adjudicator (RARAD) dismissed Mercado's complaint, ruling that the 1994 RARAD decision was void for violating due process and that Mercado was not a rightful reallocatee because the Department of Agrarian Reform (DAR) never issued an order of reallocation.
On appeal, the DARAB set aside the previous decisions, ruling that the DARAB (and its adjudicators) had no jurisdiction over the case because the reallocation of land is an administrative matter under the exclusive jurisdiction of the DAR Secretary.
The CA reversed the DARAB, ruling that the DARAB had jurisdiction over the cancellation of registered emancipation patents. The CA also ruled that the doctrine of immutability of judgment did not apply to the 1994 PARAD decision because agrarian quasi-judicial agencies are not bound by technical rules of procedure. This paved the way for Mercado to elevate the case before the Supreme Court.
In reversing the appellate court ruling, the high court held that DARAB had no jurisdiction over the case. The DARAB exercises primary and exclusive jurisdiction only over "agrarian disputes," which require the existence of a tenurial arrangement (such as tenancy or leasehold) between the parties.
It explained that in this case, there was no tenurial arrangement between Mercado and the heirs of De Guzman; the transaction was merely a loan to finance a hospitalization.
The highest bench also disagreed with the CA's reasoning as to the application of the 1994 PARAD decision. It clarified that the doctrine of immutability of judgment does apply to quasi-judicial agencies like the DARAB. However, the 1994 PARAD decision cannot be enforced as it falls under a recognized exception, being a void judgment.
"A void judgment produces no legal or binding effect, never attains finality, and can be challenged at any time," the Supreme Court said.
