In a decision penned by Associate Justice Romeo Callejo, the SC reiterated its earlier ruling that lands devoted to commercial livestock, poultry, and swine-raising are classified as industrial and, therefore, excluded from agrarian reform coverage.
Callejo cited the unconstitutionality of Department of Agrarian Reform (DAR) Administrative Order (AO) No. 9 which sought to "regulate livestock farms by excluding them in the coverage of agrarian reform and prescribing a maximum retention limit for their ownership."
The Court has held in DAR vs. Sutton that DAR exceeded its authority in issuing the said AO as it had "no power to regulate livestock farms which have been exempted by the Constitution from the coverage of agrarian reform.
The Court also said a perusal of the deliberations of the 1986 Constitutional Commission confirms the intent to exclude from agrarian reform all lands used exclusively for livestock, swine, and poultry-raising which are classified as "industrial" activities."
It likewise cited the cases of Luz Farms vs. Secretary of DAR and Natalia Realty, Inc. vs. DAR where it categorically ruled that lands devoted to residential, commercial, and industrial purposes were exempted from agrarian reform without any other qualifications.
It also pointed out the passage of RA 7881 which amended certain provisions of the 1988 CARL, "changed the definition of terms agricultural activity and commercial farming by dropping from its coverage lands that are devoted to commercial livestock, poultry and swine-raising."
Based on these rulings, the High Court affirmed that the 349.9996-hectare land in San Narciso, Quezon, owned by respondent Vicente Uy is exempted from CARL coverage.