By Carla Calleja, MBA, REB
A question I get a lot: “Broker Carla, can I buy land that’s only under a CLOA?” The lot is cheap, the farmer is willing, and the deal seems simple. Let me tell you a story first.
The story (a dramatization)
Mang Celso is a farmer-beneficiary. He received a small farm lot under agrarian reform, covered by a Certificate of Land Ownership Award (CLOA). When he fell behind on a loan, his neighbor Tonyo offered to pay it off. In return, Mang Celso signed a “waiver” giving Tonyo half the land. Tonyo felt safe: he had a signed paper and had paid real money.
Years later, the waiver was declared void. Tonyo got nothing. Mang Celso kept his title. (Names are fictional. The story mirrors a real Supreme Court case, below.)
The short answer
Within 10 years of the award, you generally cannot buy CLOA land unless you fall under the narrow exceptions in the law. A sale, transfer or “waiver” to someone outside those exceptions is void. Even after 10 years, check with DAR before any deal, because other limits on agricultural land may still apply.
What the law says
Section 27 of RA 6657 (CARP), as amended by RA 9700: “Lands acquired by beneficiaries under this Act or other agrarian reform laws shall not be sold, transferred or conveyed except through hereditary succession, or to the government, or to the LBP, or to other qualified beneficiaries through the DAR for a period of ten (10) years.” The title must show that it is a CLOA or an Emancipation Patent.
- Section 73(f) and Section 74 make it a crime to sell or transfer the “right to use” or other usufructuary rights to get around the law, with penalties of 3 years and 1 day to 6 years in prison, a fine of ₱50,000 to ₱150,000, or both.
- Section 65 allows DAR to authorize conversion to non-agricultural use after five years from the award, under strict conditions.
- PD 27 (for Emancipation Patents) says titles acquired under it “shall not be transferable” except by inheritance or to the government.
- RA 11953 (New Agrarian Emancipation Act, 2023) condoned unpaid amortizations and lifted the government’s mortgage liens, but its Section 11 says it does not remove existing limits on the transfer, ownership and agricultural use of the land.
What the Supreme Court said
In Lebrudo v. Loyola, G.R. No. 181370, March 9, 2011 (Second Division), a man said he paid to redeem a 240 sq m CLOA lot in Carmona, Cavite from a mortgage and paid for the title transfer. In exchange, the beneficiary allegedly signed a Sinumpaang Salaysay waiving half the lot to him. The Court denied his claim. It held that during the 10-year period, “any sale, transfer or conveyance of land reform rights is void, except as allowed by law.” He was also not a qualified beneficiary. The beneficiary kept the land.
What this means for YOU
- Check the title. Get a certified true copy from the Registry of Deeds. Look for the CLOA or EP marking, the award or registration date, and annotations such as a Land Bank mortgage or a condonation certificate.
- Ask DAR before paying anything. Get a certification from the Municipal or Provincial Agrarian Reform Office on the beneficiary’s status and any pending cancellation case.
- Do not rely on “waivers,” “rights” sales or long leases. Courts treat these as void if they are used to get around the 10-year rule.
Documents to prepare: certified true copy of the title, tax declaration, DAR certification, any DAR transfer approval, and a DAR conversion order if the land will not be farmed.
Where to go: Registry of Deeds (title check), DAR Municipal/Provincial Agrarian Reform Office (status, clearance, conversion), and a lawyer for any contract.
Costs: I have not listed amounts because fees vary by office and I could not verify a current official fee schedule for every item. Ask the RD and DAR office for their current fees.
FAQ
Can a CLOA holder sell to a relative?
Transfer by hereditary succession is allowed. A sale to a relative is not automatically allowed; within 10 years it must fit one of the exceptions, such as a qualified beneficiary through DAR.
What happens after 10 years?
The 10-year ban ends, but the land is still agricultural land with its own rules. Ask DAR what clearance or approval is needed before buying.
Can I get my money back if I already paid?
The Lebrudo case did not decide refunds. Talk to a lawyer about your specific facts.
Does the 2023 condonation law make CLOA land saleable?
No. RA 11953 Section 11 keeps existing transfer limits in place.
Ask Broker Carla
May tanong ka rin? Comment CLOA on my Facebook page facebook.com/carlacallejabrokerphilippines, or send your “Broker Carla, …” question to buyrentph@gmail.com.
This article is for general information only and is not legal or tax advice. For your specific situation, consult a lawyer or a licensed professional.
