September 9, 1955

REPUBLIC ACT NO. 1400

AN ACT DEFINING A LAND TENURE POLICY, PROVIDING FOR AN

INSTRUMENTALITY TO CARRY OUT THE POLICY, AND APPROPRIATING FUNDS
FOR ITS IMPLEMENTATION

SECTION 1. Short title. — This Act shall be known as the "Land Reform Act of
1955." casia

SECTION 2. Declaration of policy. — It is the declared policy of the State to create

and maintain an agrarian system which is peaceful, prosperous and stable, and to this
end the Government shall establish and distribute as many family-size farms to as
many landless citizens as possible through the opening up of public agricultural lands
and the division and distribution of private agricultural lands where agrarian con icts
exist, either by private arrangement with the owners or through expropriation
proceedings.
THE LAND TENURE ADMINISTRATION
SECTION 3. Creation and composition. — For the purpose of carrying out the
policy enunciated in this Act, there is hereby created a Land Tenure Administration,
hereinafter called the Administration, which shall be directly under the control and
supervision of and responsible to the President of the Philippines. The Administration
shall consist of a Chairman and two members who shall be appointed by the President
with the consent of the Commission on Appointments and shall hold of ce for a period
of ve years. They may be removed for cause or for incapacity to discharge the duties
of their office.
SECTION 4. Quali cations and compensation of members . — No person shall be
appointed Chairman or member of the Administration unless he is natural born citizen
of the Philippines, at least thirty- ve years of age, and not related by af nity or
consanguinity within the fourth civil degree to any landowner who may be affected by
this Act.
The Chairman shall receive an annual compensation of fteen thousand pesos
and the members shall each receive an annual compensation of twelve thousand
pesos.
SECTION 5. Functions. — It shall be the responsibility of the Administration to:
(1) Make studies on the land tenure problems throughout the Philippines,
prepare over-all long range plans to solve such problems, and keep
the President and the Congress of the Philippines fully informed of
the progress of the land tenure reform program;
(2) Initiate immediate investigation in areas reporting land tenure dif culties
and recommend appropriate action without delay;
(3) Inform the President and the Congress of the Philippines of any
de ciency of the other departments or agencies of the Government in
the implementation of legislation bearing on or affecting the land
tenure reform;
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 (4) Prepare a plan for the systematic opening of virgin lands of the public
domain for distribution to tenants, preference to be given to those
tenants who are ejected by virtue of mechanization and to other
landless citizens; and
(5) To implement and carry out the expropriation and the resale or lease of
urban lands already authorized by existing laws.
SECTION 6. Powers. — In pursuance of the policy enunciated in section two
hereof, the Administration is authorized to:
(1) Purchase private agricultural lands for resale at cost to bona fide tenants
or occupants, or in the case of estates abandoned by the owners for
the last ve years, to private individuals who will work the lands
themselves and who are quali ed to acquire or own lands but who do
not own more than six hectares of lands in the Philippines;
(2) Initiate and prosecute expropriation proceedings for the acquisition of
private agricultural lands in proper cases, for the same purpose of
resale at cost: Provided, That the power herein granted shall apply
only to private agricultural lands as to the area in excess of three
hundred hectares of contiguous area if owned by natural persons and
as to the area in excess of six hundred hectares if owned by
corporations: Provided, further, That land where justi ed agrarian
unrest exists may be expropriated regardless of its area.
(3) Prepare a schedule of areas of family-size farm units, not exceeding six
hectares each, for different crops in different localities; and
(4) Promulgate such rules and regulations as may be necessary for the
successful implementation of the provisions of this Act.
SECTION 7. Appointment of subordinate of cials and employees . — To enable
the Administration to implement the provisions of this Act more effectively, it shall have
a Legal Staff, a Technical Staff and a Financial Staff, the personnel of which shall be
appointed by the Administration which shall also fix their compensation.
The Administration shall appoint, subject to Civil Service rules and regulations, x
the compensation and determine the duties of such of cials and employees as the
exigencies of the service may require. The Administration shall establish and prescribe
its own rules, regulations, standards and records for the employment, promotion,
transfer, welfare and compensation of employees and of cers of the Administration
and provide a system of organization to for responsibility and promote efficiency.
SECTION 8. Assistance of other departments and agencies. — The
Administration may call upon any department or agency of the Government for
assistance and cooperation on any matter connected with the functions and powers of
the Administration.
NEGOTIABLE LAND CERTIFICATES
SECTION 9. Issuance. — The President, for the purposes provided for in this Act
and upon recommendation of the Secretary of Finance and concurred in by the
Monetary Board, is hereby authorized to issue negotiable land certi cates upon the
request of the Administration: Provided, That only sixty million a year will be issued
during the first two years, and thirty million each year during the succeeding years.
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 Negotiable land certi cates shall be issued in denomination of one thousand
pesos or multiples of one thousand pesos and shall be payable to bearer on demand
and presentation at the Central Bank. These certi cates if presented for payment after
ve years from the date of issue shall earn interest at the rate of four per centum per
annum; if presented for payment after ten years from the date of issue shall earn
interest at the rate of four and one-half per centum per annum; and if presented for
payment after fteen years from the date of issue shall earn interest at the rate of ve
per centum per annum.
SECTION 10. Uses of certi cates . — Negotiable land certi cates may be used by
the holder thereof for any of the following purposes:
(1) Payment for agricultural lands or other properties purchased from the
Government: Provided, however, That in the case of purchase of
agricultural lands, the purchaser is not otherwise prohibited to own or
hold agricultural lands under the Constitution;
(2) Payment for the purchase of shares of stock or of the assets of any
industrial or commercial corporations owned or controlled by the
Government; cd i

(3) Payment of all tax obligations of the holder thereof, or of any debt or
monetary obligation of the holder to the Government or any of its
instrumentalities or agencies, including the Rehabilitation Finance
Corporation and the Philippine National Bank: Provided, however, That
payment of indebtedness shall not be less than twenty per centum of
the total indebtedness of the debtor; and
(4) As surety or performance bonds, in all cases where the Government may
require or accept real property as bonds.
NEGOTIATED PURCHASE OF PRIVATE AGRICULTURAL LANDS
SECTION 11. Lands subject to the purchase. — The Administration, acting for and
on behalf of the Government, may negotiate to purchase any privately owned
agricultural land when the majority of the tenants therein petition for such purchase.
SECTION 12. Action on the petition. — Upon receipt of the petition, the
Administration shall;
(1) Within thirty days, determine on the basis of the information contained in
the petition, the suitability of the land for purchase, notify the
petitioners and the landowner accordingly, and x the date for
preliminary negotiation;
(2) Within sixty days from the preliminary negotiation, conduct
investigations and technical surveys to determine title to the land and
its real value, taking into account (a) the prevailing prices of similar
lands in the immediate area, (b) the soil conditions topography and
climate hazards, (c) actual production, (d) accessibility, and (e)
improvements; and
(3) Fix, within ninety days from the preliminary negotiation, the date for nal
negotiation.
SECTION 13. Deposit by tenants. — Before xing the date for nal negotiation
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 under section twelve, paragraph (3), and in the interest of public welfare, the
Administration shall require the tenants to form a cooperative to be af liated with a
government nancing cooperative agency. Such cooperative agency shall deposit with
the Administration an amount not exceeding twenty-five per centum of the annual gross
produce of the principal crop or crops of such land on the basis of the average of
harvest of the three years immediately preceding the year the petition was led. This
deposit shall be credited to the selling price to the tenants in accordance with the
individual contribution of each to said deposit.
SECTION 14. Payment. — In negotiating for the purchase of agricultural land, the
Administration shall offer to pay the purchase price wholly in land certi cates or partly
in legal tender and partly in land certi cates: Provided, That the amount to be paid in
legal tender shall in no case exceed fty per centum of the purchase price: Provided,
further, That the landowner, if he desires and the Administration so agrees, may be paid,
by way of barter or exchange, with such residential, commercial or industrial land
owned by the Government as may be agreed upon by the parties.
SECTION 15. Outstanding debts of tenants. — In cases where the landowner is
willing to accept payment wholly in land certi cates, the Administration is authorized to
include in the price to be paid the landowner all the outstanding debts, evidenced in
writing, of the tenants to said landowner, the Administration to be thereafter
reimbursed in accordance with such rules and regulations as it may promulgate:
Provided, That the resulting increase in price by virtue of such inclusion will not be more
than ten per centum of the total cost of the land agreed upon in the negotiated sale.

EXPROPRIATION OF PRIVATE AGRICULTURAL LANDS

SECTION 16. When proper. — The Administration may initiate and prosecute
expropriation proceedings for the acquisition of private agricultural land subject to the
provisions of section six, paragraph (2), upon petition of a majority of the tenants and
after it is convinced of the suitability of such land for subdivision into family-size farm
units, and that public interest will be served by its immediate acquisition, when any of
the following conditions exists:
(1) That the landowner falling within the terms of section six, paragraph (2),
continues to refuse to sell after all efforts have been exhausted by the
Administration to negotiate for its purchase; or
(2) That the landowner is willing to sell under sections eleven and twelve but
cannot agree with the Administration as to the price and/or the
manner of its payment.
SECTION 17. Petition. — The petition, in case the landowner refuses to sell, shall
be led in the manner and form to be prescribed by the Administration. However,
before initiating expropriation proceedings, the Administration shall make one last
effort to purchase the land by negotiated sale.
SECTION 18. Possession of the land; procedure. — The Administration after
commencing the expropriation suit may take immediate possession of the land upon
deposit, with the Court which has acquired jurisdiction over the expropriation, of money
or a certi cate of deposit of a depository of the Republic of the Philippines as provided
in section three of Rule 69 of the Rules of Court equal to the value of the land as
provisionally and promptly determined by the Court taking into consideration the
factors mentioned in section twelve, paragraph (2).
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 Thereafter the procedure in the Rules of Court with respect to eminent domain
proceedings shall be followed. Pending judicial expropriation proceedings the owner of
the land sought to be expropriated shall be given annually such allowance as his latest
income tax return, prior to the institution of the proceedings, shows to be his net
income from the land. Such allowance shall be approved by the court having jurisdiction
and shall be deducted from the final amount awarded as compensation to the owner. cda

SECTION 19. Payment. — After the court has made a nal determination of the
just compensation for the land expropriated, it shall be paid wholly in cash unless the
landowner chooses to be paid wholly or partly in land certi cates, in which case section
fifteen shall apply.
SECTION 20. Prohibition against alienation. — Upon the ling of the petition
referred to in sections twelve and sixteen, the landowner cannot alienate any portion of
the land covered by such petition except in pursuance of the provisions of this Act, or
enter into any form of contract to defeat the purposes of this Act, and no ejectment
proceedings against any tenant or occupant of the land covered by the petition shall be
instituted or prosecuted until it becomes certain that the land shall not be acquired by
the Administration.
GENERAL PROVISIONS
SECTION 21. Resale of lands purchased or expropriated subject to condition. —
It shall be a condition in all resale contracts and annotated on the Torrens titles of lands
acquired and subdivided by authority of this Act that said lands shall not be subdivided,
sold or in any manner transferred or encumbered without prior consent of the
Administration and only to quali ed farmers or tenants or to government banking
institutions or agencies.
SECTION 22. Exemption from tax. — All land certi cates issued by authority of
this Act shall be exempt from all forms of taxes. The purchase price paid by the
Government for any agricultural land acquired for resale to tenants under the authority
of this Act, whether through negotiation or expropriation, shall not be considered as
income of the landowner concerned for purposes of the income tax.
SECTION 23. De nition of terms . — For the purposes of this Act, the following
terms are defined as follows: acd

(1) Agricultural lands — shall mean lands devoted to agricultural production

and shall include the farm home lots.
(2) Family-size farm units — shall mean such area of farm land not exceeding
six hectares as will permit the ef cient use of the labor resources of
the farm family, taking into account the addition of such
supplementary labor as may be necessary either for seasonal peak
loads or during the developmental and transitional stages of the
family itself.
(3) At cost — shall mean the purchase price plus six per cent interest per
annum for twenty- ve years which includes the one per cent per
annum for administration expenses, plus actual expenses for survey,
subdivision and registration. The total, divided into twenty- ve equal
installments, shall be the annual cost to the tenant for twenty- ve
years.
SECTION 24. Payment of family-size farms sold to veterans and other
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 government employees. — Veterans of the Armed Forces of the Philippines and other
government employees with backpay certi cates from the Government are hereby
authorized to use their backpay certi cates in payment of family-size farms that may
be acquired by them by authority of this Act.
SECTION 25. Trust fund . — All collections from the redistribution of the lands
acquired by the Administration, after deducting the one per cent for administration
expenses and the actual expenses for survey, subdivision and registration, shall be kept
in the National Treasury as a special trust fund to be used exclusively for the
redemption of the land certificates and bonds issued by authority of this Act.
SECTION 26. Sinking fund; appropriation. — A sinking fund shall be established in
such manner that the total annual contribution thereto, accrued at such rate of interest
as may be determined by the Secretary of Finance in consultation with the Monetary
Board, shall be suf cient to redeem at maturity the land certi cates and bonds issued
under this Act. Said fund shall be under the custody of the Central Bank for which shall
invest the same in such manner as the Monetary Board may approve; shall charge all
expenses of such investment to said sinking fund; and shall credit the same with the
interest on investments and other income belonging to it.
A standing annual appropriation not exceeding twenty million pesos is hereby
made out of the general fund in the National Treasury to provide for the sinking fund
created in this section and to carry into effect the purposes of this Act.
In addition, there is hereby appropriated out of the bond issue authorized under
Republic Act Numbered One thousand, the sum of one hundred million pesos to carry
out the provisions of this Act.
SECTION 27. Appropriation for the Administration. — There is hereby
appropriated out of any funds in the National Treasury not otherwise appropriated, the
sum of three hundred thousand pesos for salaries, per diems, traveling expenses,
furniture, office supplies and other expenses that may be incurred by the Administration
for the scal year 1955–1956. The expenses of the Administration for the succeeding
years shall be provided for in the corresponding annual general appropriation acts.
SECTION 28. Transfer of functions of the Division of Landed Estates, Bureau of
Lands. — Upon the organization of the Administration, the Division of Landed Estates in
the Bureau of Lands shall stand abolished and its functions, powers and duties,
personnel, records, equipment and balances of appropriation shall thereupon be
transferred to the said Administration.
SECTION 29. Repeal of laws. — All acts or parts of acts which are inconsistent
with the provisions of this Act are hereby repealed.
SECTION 30. Effectivity. — This Act shall take effect upon its approval.
Approved: September 9, 1955
Published in the Official Gazette, Vol. 51, No. 10, p. 4960 in October 1955

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