agrarian reform cases and provisions

DLSU Agrarian Law and Social Legislation -- Atty. Aison Garcia JPBA 17June2013

RA 1199, as amended by RA 2263

- Secs 3, 5(a), 5(b)

SECTION 3. Agricultural Tenancy Defined. — Agricultural tenancy is the physical possession by a person of land devoted to agriculture belonging to, or legally possessed by, another for the purpose of production through the labor of the former and of the members of his immediate farm household, in consideration of which the former agrees to share the harvest with the latter, or to pay a price certain or ascertainable, either in produce or in money, or in both.

SECTION 5. Definitions of Terms. — As used in this Act:

(a) A tenant shall mean a person who, himself and with the aid available from within his immediate farm household, cultivates the land belonging to, or possessed by, another, with the latter's consent for purposes of production, sharing the produce with the landholder under the share tenancy system, or paying to the landholder a price certain or ascertainable in produce or in money or both, under the leasehold tenancy system.

(b) A landholder shall mean a person, natural or juridical, who, either as owner, lessee, usufructuary, or legal possessor, lets or grants to another the use or cultivation of his land for a consideration either in shares under the share tenancy system, or a price certain or ascertainable under the leasehold tenancy system.

RA 3844

- Secs 4-38 AGRICULTURAL LEASEHOLD SYSTEM

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Section 4. Abolition of Agricultural Share Tenancy - Agricultural share tenancy, as herein defined, is hereby declared to be contrary to public policy and shall be abolished: Provided, That existing share tenancy contracts may continue in force and effect in any region or locality, to be governed in the meantime by the pertinent provisions of

Republic Act Numbered Eleven hundred and ninety-nine, as amended, until the end of the agricultural year when the National Land Reform Council proclaims that all the government machineries and agencies in that region or locality relating to leasehold envisioned in this Code are operating, unless such contracts provide for a shorter period or the tenant sooner exercise his option to elect the leasehold system: Provided, further, That in order not to jeopardize international commitments, lands devoted to crops covered by marketing allotments shall be made the subject of a separate proclamation that adequate provisions, such as the organization of cooperatives, marketing agreements, or other similar workable arrangements, have been made to insure efficient management on all matters requiring synchronization of the agricultural with the processing phases of such crops: Provided, furthermore, That where the agricultural share tenancy contract has ceased to be operative by virtue of this Code, or where such a tenancy contract has been entered into in violation of the provisions of this Code and is, therefore, null and void, and the tenant continues in possession of the land for cultivation, there shall be presumed to exist a leasehold relationship under the provisions of this Code, without prejudice to the right of the landowner and the former tenant to enter into any other lawful contract in relation to the land formerly under tenancy contract, as long as in the interim the security of tenure of the former tenant under Republic Act Numbered Eleven hundred and ninety-nine, as amended, and as provided in this Code, is not impaired: Provided, finally, That if a lawful leasehold tenancy contract was entered into prior to the effectivity of this Code, the rights and obligations arising therefrom shall continue to subsist until modified by the parties in accordance with the provisions of this Code.

Section 5. Establishment of Agricultural Leasehold Relation - The agricultural leasehold relation shall be established by operation of law in accordance with Section four of this Code and, in other cases, either orally or in writing, expressly or impliedly.

Section 6. Parties to Agricultural Leasehold Relation - The agricultural leasehold relation shall be limited to the person who furnishes the landholding, either as owner, civil law lessee, usufructuary, or legal possessor, and the person who personally cultivates the same.

Section 7. Tenure of Agricultural Leasehold Relation - The agricultural leasehold relation once established shall confer upon the


agricultural lessee the right to continue working on the landholding until such leasehold relation is extinguished. The agricultural lessee shall be entitled to security of tenure on his landholding and cannot be ejected therefrom unless authorized by the Court for causes herein provided.

Section 8. Extinguishment of Agricultural Leasehold Relation - The agricultural leasehold relation established under this Code shall be extinguished by:

(1) Abandonment of the landholding without the knowledge of the agricultural lessor;

(2) Voluntary surrender of the landholding by the agricultural lessee, written notice of which shall be served three months in advance; or

(3) Absence of the persons under Section nine to succeed to the lessee, in the event of death or permanent incapacity of the lessee.

Section 9. Agricultural Leasehold Relation Not Extinguished by Death or Incapacity of the Parties - In case of death or permanent incapacity of the agricultural lessee to work his landholding, the leasehold shall continue between the agricultural lessor and the person who can cultivate the landholding personally, chosen by the agricultural lessor within one month from such death or permanent incapacity, from among the following: (a) the surviving spouse; (b) the eldest direct descendant by consanguinity; or (c) the next eldest descendant or descendants in the order of their age: Provided, That in case the death or permanent incapacity of the agricultural lessee occurs during the agricultural year, such choice shall be exercised at the end of that agricultural year: Provided, further, That in the event the agricultural lessor fails to exercise his choice within the periods herein provided, the priority shall be in accordance with the order herein established.

In case of death or permanent incapacity of the agricultural lessor, the leasehold shall bind his legal heirs.

Section 10. Agricultural Leasehold Relation Not Extinguished by Expiration of Period, etc. - The agricultural leasehold relation under this

Code shall not be extinguished by mere expiration of the term or period in a leasehold contract nor by the sale, alienation or transfer of the legal possession of the landholding. In case the agricultural lessor sells, alienates or transfers the legal possession of the landholding, the purchaser or transferee thereof shall be subrogated to the rights and substituted to the obligations of the agricultural lessor.

Section 11. Lessee's Right of Pre-emption - In case the agricultural lessor decides to sell the landholding, the agricultural lessee shall have the preferential right to buy the same under reasonable terms and conditions: Provided, That the entire landholding offered for sale must be pre-empted by the Land Authority if the landowner so desires, unless the majority of the lessees object to such acquisition: Provided, further, That where there are two or more agricultural lessees, each shall be entitled to said preferential right only to the extent of the area actually cultivated by him. The right of pre-emption under this Section may be exercised within ninety days from notice in writing which shall be served by the owner on all lessees affected.

Section 12. Lessee's Right of Redemption - In case the landholding is sold to a third person without the knowledge of the agricultural lessee, the latter shall have the right to redeem the same at a reasonable price and consideration: Provided, That the entire landholding sold must be redeemed: Provided, further, That where there are two or more agricultural lessees, each shall be entitled to said right of redemption only to the extent of the area actually cultivated by him. The right of redemption under this Section may be exercised within two years from the registration of the sale, and shall have priority over any other right of legal redemption.

Section 13. Affidavit Required in Sale of Land Subject to Right of Pre-emption - No deed of sale of agricultural land under cultivation by an agricultural lessee or lessees shall be recorded in the Registry of Property unless accompanied by an affidavit of the vendor that he has given the written notice required in Section eleven of this Chapter or that the land is not worked by an agricultural lessee.

Section 14. Right of Pre-emption and Redemption Not Applicable to Land to be Converted into Residential, Industrial and Similar Purposes - The right of pre-emption and redemption granted under Sections eleven and twelve of this Chapter cannot be exercised over


landholdings suitably located which the owner bought or holds for conversion into residential, commercial, industrial or other similar non-agricultural purposes: Provided, however, That the conversion be in good faith and is substantially carried out within one year from the date of sale. Should the owner fail to comply with the above condition, the agricultural lessee shall have the right to repurchase under reasonable terms and conditions said landholding from said owner within one year after the aforementioned period for conversion has expired: Provided, however, That the tenure of one year shall cease to run from the time the agricultural lessee petitions the Land Authority to acquire the land under the provisions of paragraph 11 of Section fifty-one.

Section 15. Agricultural Leasehold Contract in General - The agricultural lessor and the agricultural lessee shall be free to enter into any kind of terms, conditions or stipulations in a leasehold contract, as long as they are not contrary to law, morals or public policy. A term, condition or stipulation in an agricultural leasehold contract is considered contrary to law, morals or public policy:

(1) If the agricultural lessee is required to pay a rental in excess of that which is hereinafter provided for in this Chapter;

(2) If the agricultural lessee is required to pay a consideration in excess of the fair rental value as defined herein, for the use of work animals and/or farm implements belonging to the agricultural lessor or to any other person; or

(3) If it is imposed as a condition in the agricultural leasehold contract: (a) that the agricultural lessee is required to rent work animals or to hire farm implements from the agricultural lessor or a third person, or to make use of any store or services operated by the agricultural lessor or a third person; or (b) that the agricultural lessee is required to perform any work or render any service other than his duties and obligations provided in this Chapter with or without compensation; or (c) that the agricultural lessee is required to answer for any fine, deductions and/or assessments.

Any contract by which the agricultural lessee is required to accept a loan or to make payment therefor in kind shall also be contrary to law, morals or public policy.

Section 16. Nature and Continuity of Conditions of Leasehold Contract - In the absence of any agreement as to the period, the terms and conditions of a leasehold contract shall continue until modified by the parties: Provided, That in no case shall any modification of its terms and conditions prejudice the right of the agricultural lessee to the security of his tenure on the landholding: Provided, further, That in case of a contract with a period an agricultural lessor may not, upon the expiration of the period increase the rental except in accordance with the provisions of Section thirty-four.

Section 17. Form and Registration of Contract - Should the parties decide to reduce their agreement into writing, the agricultural leasehold contract shall be drawn in quadruplicate in a language or dialect known to the agricultural lessee and signed or thumb-marked both by the agricultural lessee personally and by the agricultural lessor or his authorized representative, before two witnesses, to be chosen by each party. If the agricultural lessee does not know how to read, the contents of the document shall be read and explained to him by his witness. The contracting parties shall acknowledge the execution of the contract before the justice of the peace of the municipality where the land is situated. No fees or stamps of any kind shall be required in the preparation and acknowledgment of the instrument. Each of the contracting parties shall retain a copy of the contract. The justice of the peace shall cause the third copy to be delivered to the municipal treasurer of the municipality where the land is located and the fourth copy to the Office of the Agrarian Counsel.

Except in case of mistake, violence, intimidation, undue influence, or fraud, an agricultural contract reduced in writing and registered as hereinafter provided, shall be conclusive between the contracting parties, if not denounced or impugned within thirty days after its registration.

Section 18. Registration of Leasehold Contract - The municipal treasurer shall, upon receipt of his copy of the contract, require the agricultural lessee and agricultural lessor to present their respective copies of the contract, and shall cause to be annotated thereon the date, time and place of registration as well as its entry or registration number.


Section 19. Registry of Agricultural Leasehold Contracts - The Municipal Treasurer of the municipality wherein the land is situated shall keep a record of all such contracts drawn and executed within his jurisdiction, to be known as "Registry of Agricultural Leasehold Contracts". He shall keep this registry together with a copy of each contract entered therein, and make annotations on said registry of all subsequent acts relative to each contract, such as its renewal, novation, cancellation, etc. No registration fees or documentary stamps shall be required in the registration of said contracts or of any subsequent acts relative thereto.

Section 20. Memorandum of Loans - No obligation to pay money on account of loans including interest thereon obtained by the agricultural lessee from the agricultural lessor or his representative shall be enforceable unless the same or a memorandum thereof be in writing in a language or dialect known to the agricultural lessee, and signed or thumb-marked by him, or by his agent.

Section 21. Exemption from Lien and/or Execution - The following shall be exempt from lien and/or execution against the agricultural lessee:

(1) Twenty-five per centum of the entire produce of the land under cultivation; and

(2) Work animals and farm implements belonging to the agricultural lessee: Provided, That their value does not exceed one thousand pesos. But no article or species of property mentioned in this Section shall be exempt from execution issued upon a judgment recovered for its price or upon a judgment of foreclosure of a mortgage thereon.

Section 22. Use of Accepted Standards of Weights and Measures - In all transactions entered into between the agricultural lessee and the agricultural lessor concerning agricultural products the official or, upon agreement of the parties, the accepted standards of weights and measures shall be used.

Section 23. Rights of Agricultural Lessee in General - It shall be the right of the agricultural lessee:

(1) To have possession and peaceful enjoyment of the land;

(2) To manage and work on the land in a manner and method of cultivation and harvest which conform to proven farm practices;

(3) To mechanize all or any phase of his farm work; and

(4) To deal with millers and processors and attend to the issuance of quedans and warehouse receipts for the produce due him.

Section 24. Right to a Home Lot - The agricultural lessee shall have the right to continue in the exclusive possession and enjoyment of any home lot he may have occupied upon the effectivity of this Code, which shall be considered as included in the leasehold.

Section 25. Right to be Indemnified for Labor - The agricultural lessee shall have the right to be indemnified for the cost and expenses incurred in the cultivation, planting or harvesting and other expenses incidental to the improvement of his crop in case he surrenders or abandons his landholding for just cause or is ejected therefrom. In addition, he has the right to be indemnified for one-half of the necessary and useful improvements made by him on the landholding: Provided, That these improvements are tangible and have not yet lost their utility at the time of surrender and/or abandonment of the landholding, at which time their value shall be determined for the purpose of the indemnity for improvements.

Section 26. Obligations of the Lessee - It shall be the obligation of the agricultural lessee:

(1) To cultivate and take care of the farm, growing crops, and other improvements on the landholding as a good father of a family and perform all the work therein in accordance with proven farm practices;

(2) To inform the agricultural lessor within a reasonable time of any trespass committed by third persons upon the farm, without prejudice to his direct action against the trespasser;

(3) To take reasonable care of the work animals and farm implements delivered to him by the agricultural lessor and see that they are not used for purposes other than those


intended or used by another without the knowledge and consent of the agricultural lessor: Provided, however, That if said work animals get lost or die, or said farm implements get lost or are destroyed, through the negligence of the agricultural lessee, he shall be held responsible and made answerable therefor to the extent of the value of the work animals and/or farm implements at the time of the loss, death or destruction;

(4) To keep his farm and growing crops attended to during the work season. In case of unjustified abandonment or neglect of his farm, any or all of his expected produce may, upon order of the Court, be forfeited in favor of the agricultural lessor to the extent of the damage caused thereby;

(5) To notify the agricultural lessor at least three days before the date of harvesting or, whenever applicable, of threshing; and

(6) To pay the lease rental to the agricultural lessor when it falls due.

Section 27. Prohibitions to Agricultural Lessee - It shall be unlawful for the agricultural lessee:

(1) To contract to work additional landholdings belonging to a different agricultural lessor or to acquire and personally cultivate an economic family-size farm, without the knowledge and consent of the agricultural lessor with whom he had entered first into household, if the first landholding is of sufficient size to make him and the members of his immediate farm household fully occupied in its cultivation; or

(2) To employ a sub-lessee on his landholding: Provided, however, That in case of illness or temporary incapacity he may employ laborers whose services on his landholding shall be on his account.

Section 28. Termination of Leasehold by Agricultural Lessee During Agricultural Year - The agricultural lessee may terminate the leasehold during the agricultural year for any of the following causes:

(1) Cruel, inhuman or offensive, treatment of the agricultural lessee or any member of his immediate farm household by the agricultural lessor or his representative with the knowledge and consent of the lessor;

(2) Non-compliance on the part of the agricultural lessor with any of the obligations imposed upon him by the provisions of this Code or by his contact with the agricultural lessee;

(3) Compulsion of the agricultural lessee or any member of his immediate farm household by the agricultural lessor to do any work or render any service not in any way connected with farm work or even without compulsion if no compensation is paid;

(4) Commission of a crime by the agricultural lessor or his representative against the agricultural lessee or any member of his immediate farm household; or

(5) Voluntary surrender due to circumstances more advantageous to him and his family.

Section 29. Rights of the Agricultural Lessor - It shall be the right of the agricultural lessor:

(1) To inspect and observe the extent of compliance with the terms and conditions of their contract and the provisions of this Chapter;

(2) To propose a change in the use of the landholding to other agricultural purposes, or in the kind of crops to be planted: Provided, That in case of disagreement as to the proposed change, the same shall be settled by the Court according to the best interest of the parties concerned: Provided, further, That in no case shall an agricultural lessee be ejected as a consequence of the conversion of the land to some other agricultural purpose or because of a change in the crop to be planted;

(3) To require the agricultural lessee, taking into consideration his financial capacity and the credit facilities available to him, to adopt in his farm proven farm practices


necessary to the conservation of the land, improvement of its fertility and increase of its productivity: Provided, That in case of disagreement as to what proven farm practice the lessee shall adopt, the same shall be settled by the Court according to the best interest of the parties concerned; and

(4) To mortgage expected rentals.

Section 30. Obligations of the Agricultural Lessor - It shall be the obligation of the agricultural lessor:

(1) To keep the agricultural lessee in peaceful possession and cultivation of his landholding; and

(2) To keep intact such permanent useful improvements existing on the landholding at the start of the leasehold relation as irrigation and drainage system and marketing allotments, which in the case of sugar quotas shall refer both to domestic and export quotas, provisions of existing laws to the contrary notwithstanding.

Section 31. Prohibitions to the Agricultural Lessor - It shall be unlawful for the agricultural lessor:

(1) To dispossess the agricultural lessee of his landholding except upon authorization by the Court under Section thirty-six. Should the agricultural lessee be dispossessed of his landholding without authorization from the Court, the agricultural lessor shall be liable for damages suffered by the agricultural lessee in addition to the fine or imprisonment prescribed in this Code for unauthorized dispossession;

(2) To require the agricultural lessee to assume, directly or indirectly, the payment of the taxes or part thereof levied by the government on the landholding;

(3) To require the agricultural lessee to assume, directly or indirectly, any part of the rent, "canon" or other consideration which the agricultural lessor is under obligation to pay to third persons for the use of the land;

(4) To deal with millers or processors without written authorization of the lessee in cases where the crop has to be sold in processed form before payment of the rental; or

(5) To discourage, directly or indirectly, the formation, maintenance or growth of unions or organizations of agricultural lessees in his landholding, or to initiate, dominate, assist or interfere in the formation or administration of any such union or organization.

Section 32. Cost of Irrigation System - The cost of construction of a permanent irrigation system, including distributory canals, may be borne exclusively by the agricultural lessor who shall be entitled to an increase in rental proportionate to the resultant increase in production: Provided, That if the agricultural lessor refuses to bear the expenses of construction the agricultural lessee or lessees may shoulder the same, in which case the former shall not be entitled to an increase in rental and shall, upon the termination of the relationship, pay the lessee or his heir the reasonable value of the improvement at the time of the termination: Provided, further, That if the irrigation system constructed does not work, it shall not be considered as an improvement within the meaning of this Section.

Section 33. Manner, Time and Place of Rental Payment - The consideration for the lease of the land shall be paid in an amount certain in money or in produce, or both, payable at the place agreed upon by the parties immediately after threshing or processing if the consideration is in kind, or within a reasonable time thereafter, if not in kind.

In no case shall the agricultural lessor require the agricultural lessee to file a bond, make a deposit or pay the rental in advance, in money or in kind or in both, but a special and preferential lien is hereby created in favor of the agricultural lessor over such portion of the gross harvest necessary for the payment of the rental due in his favor.

Section 34. Consideration for the Lease of Riceland and Lands Devoted to Other Crops - The consideration for the lease of riceland and lands devoted to other crops shall not be more than the equivalent of twenty-five per centum of the average normal harvest during the three agricultural years immediately preceding the date the leasehold was established after deducting the amount used for


seeds and the cost of harvesting, threshing, loading, hauling and processing, whichever are applicable: Provided, That if the land has been cultivated for a period of less than three years, the initial consideration shall be based on the average normal harvest during the preceding years when the land was actually cultivated, or on the harvest of the first year in the case of newly-cultivated lands, if that harvest is normal: Provided, further, That after the lapse of the first three normal harvests, the final consideration shall be based on the average normal harvest during these three preceding agricultural years: Provided, furthermore, That in the absence of any agreement between the parties as to the rental, the maximum allowed herein shall apply: Provided, finally, That if capital improvements are introduced on the farm not by the lessee to increase its productivity, the rental shall be increased proportionately to the consequent increase in production due to said improvements. In case of disagreement, the Court shall determine the reasonable increase in rental.

Section 35. Exemption from Leasehold of Other Kinds of Lands - Notwithstanding the provisions of the preceding Sections, in the case of fishponds, saltbeds, and lands principally planted to citrus, coconuts, cacao, coffee, durian, and other similar permanent trees at the time of the approval of this Code, the consideration, as well as the tenancy system prevailing, shall be governed by the provisions of Republic Act Numbered Eleven hundred and ninety-nine, as amended.

Section 36. Possession of Landholding; Exceptions - Notwithstanding any agreement as to the period or future surrender, of the land, an agricultural lessee shall continue in the enjoyment and possession of his landholding except when his dispossession has been authorized by the Court in a judgment that is final and executory if after due hearing it is shown that:

(1) The agricultural lessor-owner or a member of his immediate family will personally cultivate the landholding or will convert the landholding, if suitably located, into residential, factory, hospital or school site or other useful non-agricultural purposes: Provided; That the agricultural lessee shall be entitled to disturbance compensation equivalent to five years rental on his landholding in addition to his rights under Sections twenty-five and thirty-four, except when the land owned and leased by the agricultural lessor, is not more than

five hectares, in which case instead of disturbance compensation the lessee may be entitled to an advanced notice of at least one agricultural year before ejectment proceedings are filed against him: Provided, further, That should the landholder not cultivate the land himself for three years or fail to substantially carry out such conversion within one year after the dispossession of the tenant, it shall be presumed that he acted in bad faith and the tenant shall have the right to demand possession of the land and recover damages for any loss incurred by him because of said dispossessions.

(2) The agricultural lessee failed to substantially comply with any of the terms and conditions of the contract or any of the provisions of this Code unless his failure is caused by fortuitous event or force majeure;

(3) The agricultural lessee planted crops or used the landholding for a purpose other than what had been previously agreed upon;

(4) The agricultural lessee failed to adopt proven farm practices as determined under paragraph 3 of Section twenty-nine;

(5) The land or other substantial permanent improvement thereon is substantially damaged or destroyed or has unreasonably deteriorated through the fault or negligence of the agricultural lessee;

(6) The agricultural lessee does not pay the lease rental when it falls due: Provided, That if the non-payment of the rental shall be due to crop failure to the extent of seventy-five per centum as a result of a fortuitous event, the non-payment shall not be a ground for dispossession, although the obligation to pay the rental due that particular crop is not thereby extinguished; or

(7) The lessee employed a sub-lessee on his landholding in violation of the terms of paragraph 2 of Section twenty-seven.


Section 37. Burden of Proof - The burden of proof to show the existence of a lawful cause for the ejectment of an agricultural lessee shall rest upon the agricultural lessor.

Section 38. Statute of Limitations - An action to enforce any cause of action under this Code shall be barred if not commenced within three years after such cause of action accrued.

Elements

1) Parties are owner/possessor and tenant 2) Subject is agricultural

land

3) Consen 4) Purpose is agricultural production

5) Consideration 6) Personal cultivation

- Cases:

o Cayetano and Tiongson vs CA (G.R. No. L-62626)

GUTIERREZ, JR., J.:

NATURE: Petition for review on certiorari of the decision of the CA declaring the existence of a landholder-tenant relationship and ordering Macaya’s reinstatement.

FACTS: In 1946, Severino Manotok donated and transferred to his 8 children and two 2 grandchildren. a thirty-four-hectare lot located in Payong, Old Balara, Quezon City covered by a certificate of title. At that time, there were no tenants or other persons occupying the said property.

Teodoro Macaya went to Manotok and pleaded to live on the Balara property, so he could at the same time guard it from squatters and theft. Manotok allowed Macaya to stay as a guard (bantay) with the condition that (1) he would vacate anytime the owners wanted or needed to take over the property (2) he alone could raise animals and plants, but only for his personal needs; and that (3) the owners would have no responsibility or liability for said activities of Macaya. Macaya was allowed to use only 3 hectares. Conditions were not put in writing.

On December 5, 1950, the property-owners organized themselves into a corporation, Manotok Realty, Inc. The owners transferred the 34-hectare lot to the corporation.

From 1946 to 1956, Macaya did not pay in cash or in kind for his occupancy or use of the property. When realty taxes increased considerably, the owners found it very burdensome and requested help from Macaya. The latter agreed started remitting 10 cavans of palay every year as his contribution for realty taxes beginning 1957. This increased to 20 cavans effective 1963.

In 1967, Macaya informed Manotoc, Inc. he could not afford to deliver anymore palay because they dried up. He further requested that in the ensuring years, he contribute only 10 cavans. Corporation said he might as well not deliver. Thus, from 1967 up to 1976, Macaya did not deliver any.

On January 31, 1974, Manotok Realty, Inc. executed a "Unilateral Deed of Conveyance" of the property in favor of Patricia Tiongson et al. (Manotoks etc.) Macaya was informed by the Manotoks that they needed the property to construct their houses. Macaya agreed but pleaded he be allowed to harvest first the planted rice, but he did not vacate as promised and instead expanded the area he was working on.

In 1976, the Manotoks again made demands for Macaya to vacate. Macaya had increased his area from three (3) hectares to six (6) hectares without knowledge or consent of the owners. Macaya brought the matter to the Department (now Ministry) of Agrarian Reforms. Manotoks threatened to bulldoze Macaya's landholding thus prompting Macaya to file an action for peaceful possession, injunction, and damages with preliminary injunction before the Court of Agrarian Relations. Latter ruled Macaya was never a share or leasehold tenant. On appeal, this was reversed.

ISSUE: Whether or not a tenancy relationship exists between the parties.

RULING: NO.

The essential requisites of tenancy relationship are: 1) the parties are the landholder and the tenant; 2) the subject is agricultural land; 3) there is consent; 4) the purpose is agricultural production; and 5) there is consideration (Agustin, Code of Agrarian Reforms of the Philippines, 1981, p. 19).

All these requisites are necessary in order to create tenancy relationship between the parties and the absence of one or more requisites do not make the alleged tenant a de facto tenant, as contra-distinguished from a de jure tenant, This is so because unless a person has established his status as a de jure tenant, he is not entitled to security of tenure nor is he covered by the Land Reform Program of the Government under existing tenancy laws. ...


The key factor in ascertaining whether or not there is a landowner-tenant relationship in this case is the nature of the disputed property.

From the year 1948 up to the present, the tax declarations of real property and the annual receipts for real estate taxes paid have always classified the land as "residential".

University of the Philippines and near some fast growing residential subdivisions. The Manotok family is engaged in the business of developing subdivisions in Metro Manila, not in farming.

The fact that a caretaker plants rice or corn on a residential lot in the middle of a residential subdivision in the heart of a metropolitan area cannot by any strained interpretation of law convert it into agricultural land and subject it to the agrarian reform program.

May Macaya be considered as a tenant and Manotok as a landholder? Significant, as the trial court noted, is that the parties have not agreed as to their contributions of the several items of productions such as expenses for transplanting, fertilizers, weeding and application of insecticides, etc. In the absence of an agreement as to the respective contributions of the parties or other terms and conditions of their tenancy agreement, the lower court concluded that no tenancy relationship was entered into between them as tenant and landholder.

From 1967 to the present, Macaya did not deliver any cavans of palay to the petitioners as the latter felt that if Macaya could no longer deliver the twenty (20) cavans of palay, he might as well not deliver any. The decision of the petitioners not to ask for anymore contributions from Macaya reveals that there was no tenancy relationship ever agreed upon by the parties. Neither can such relationship be implied from the facts as there was no agreed system of sharing the produce of the property.

Going over the third requisite which is consent, the trial court observed that the property in question previous to 1946 had never been tenanted. The lower court further considered the fact that the amount of ten (10) cavans of palay given by Macaya to the owners from 1957 to 1964 which was later increased to twenty (20) cavans of palay from 1964 to 1966 was grossly disproportionate to the amount of taxes paid by the owners. The lot was taxed as residential land in a metropolitan area. There was clearly no intention on the part of the owners to devote the property for agricultural production but only for residential purposes.

The last requisite is consideration.

It bears re-emphasizing that from 1946 to 1956, there was no agreement as to any system of sharing the produce of the land. The petitioners did not get anything from the harvest and private respondent Macaya was using and cultivating the land free from any charge or expense. The situation was rather strange had there been a tenancy agreement between Don Severino and Macaya.

We can understand the sympathy and compassion which courts of justice must feel for people in the same plight as Mr. Macaya and his family. However, the petitioners have been overly generous and understanding of Macaya's problems. For ten years from 1946 to 1956, he lived on the property, raising animals and planting crops for personal use, with only his services as "bantay" compensating for the use of another's property. From 1967 to the present, he did not contribute to the real estate taxes even as he dealt with the land as if it were his own. He abused the generosity of the petitioners when he expanded the permitted area for cultivation from three hectares to six or eight hectares. Mr. Macaya has refused to vacate extremely valuable residential land contrary to the clear agreement when he was allowed to enter it. The facts of the case show that even Mr. Macaya did not consider himself as a true and lawful tenant and did not hold himself out as one until he was asked to vacate the property.

o Caballes vs DAR (G.R. No. 78214)

SARMIENTO, J.:

NATURE: Before us is a petition for certiorari seeking the annulment of an Order issued by the public respondent Ministry of Agrarian Reform , finding the existence of a tenancy relationship between petitioner and the private respondent and certifying the criminal case for malicious mischief filed by the petitioner against the private respondent as not proper for trial.

FACTS: The land, consisting in 60 square meters was acquired by the spouses Arturo and Yolanda Caballes through Deed of Absolute Sale executed by Andrea Alicaba Millenes. This landholding is part of Lot No. 3109-C, with a total area of about 500 square meters, in Lawaan Talisay, Cebu. The remainder of the lot was subsequently sold to the spouses by Macario Alicaba and the other members of the Millenes family, thus consolidating ownership over the entire (500-square meter) property in favor of the petitioner.

In 1975, before the sale in favor of the Caballes spouses, private respondent Bienvenido Abajon constructed his house on a portion of the said landholding, paying a monthly rental of P2.00 to the owner, Andrea Millenes.


The landowner likewise allowed Abajon to plant on a portion of the land, agreeing that the produce thereof would be shared by both on a fitfy-fifty basis. From 1975-1977, Abajon planted corn and bananas on the landholding. In 1978, he stopped planting corn but continued to plant bananas and camote. During those four years, he paid the P2.00 rental for the lot occupied by his house, and delivered 50% of the produce to Andrea Millenes.

Sometime in March 1979, after the property was sold, the spouses told Abajon that they intend to build a poultry close to his house, so they persuaded him to transfer to the southern portion of the landholding. Abajon offered to pay the new owners rental on the land occupied by his house, but they refused. Later, the spouses asked Abajon to vacate the premises, saying that they needed it. Abajon refused. The parties had a confrontation before the Barangay but failed to reach an agreement. All the efforts to oust Abajon from the landholding were in vain as the latter simply refused.

On April 1, 1982, the landowner, Yolanda Caballes, executed an Affidavit stating that that after she reprimanded Abajon for harvesting bananas and jackfruit from the property without her knowledge, the latter cut down the banana plants worth about P50.00. A criminal case for malicious mischief was filed against Abajon. The trial court referred the case to MAR for preliminary determination of the relationship between the parties. Regional Director of MAR Regional VII, issued a certification stating that said Criminal Case No. 4003 was not proper for hearing, on the basis that: (1) accused is a bona-fide tenant of the land which is devoted to bananas; (2) case is filed patently to harass and/or eject the tenant from his farmholding; (3) case arose in connection with agrarian relations.

Petitioner appealed to the then MAR, now DAR. DARreversed the previous certificationdeclaring Criminal Case No. 4003 as proper for trial as "the land involved is a residential lot consisting of only 60 square meters whereon the house of the accused is constructed and within the industrial zone of the town as evinced from the Certification issued by the Zoning Administrator.

Abajon filed a motion for reconsideration, and DAR set aside the previous Order, finding the existence of a tenancy relationship and that the case was designed to harass the accused.

Former landowner, Andrea Millenes, testified that Bienvenido Abajon dutifully gave her 50% share of the produce of the land under his cultivation. The grandson of Andrea Millenes, Roger Millenes, corroborated the testimony. Roger Millenes further testified that the present owners received in his

presence a bunch of bananas from the accused gathered after Caballes had acquired the property. 4

DAR concluded that Abajon was a tenant of Andrea Millenes, thus, invoking Sec. 10 of RA 3844, as amended which provides that "[T]he agricultural leasehold relation under this Code shall not be extinguished by mere expiration of the term or period in a leasehold contract nor by the sale, alienation or transfer of the legal possession of the landholding"; and that "(I)n case the agricultural lessor sells, alienates or transfers the legal possession of the landholding, the purchaser or transferee thereof shall be subrogated to the rights and substituted to the obligations of the agricultural lessor," the MAR ruled that 'the new owners are legally bound to respect the tenancy, notwithstanding their claim that the portion tilled by Abajon was small, consisting merely of three (3) meters wide and twenty (20) meters long, or a total of sixty (60) square meters."

ISSUE: W/N Abajon holds tenant status and can therefore benefit from Sec. 10 of RA 3844.

RULING: NO.

RA 3844, as amended, defines an economic family-size farm as "an area of farm land that permits efficient use of labor and capital resources of the farm family and will produce an income sufficient to provide a modest standard of living to meet a farm family's needs for food, clothing, shelter, and education with possible allowance for payment of yearly installments on the land, and reasonable reserves to absorb yearly fluctuations in income." 8

The private respondent only occupied a miniscule portion (60 square meters) of the 500-square meter lot. Sixty square meters of land planted to bananas, camote, and corn cannot by any stretch of the imagination be considered as an economic family-size farm.

The private respondent himself admitted that he did not depend on the products of the land because it was too small, and that he took on carpentry jobs on the side.

The essential requisites of a tenancy relationship are: 1) The parties are the landowner and the tenant; 2) The subject is agricultural land; 3) There is consent; 4) The purpose is agricultural production; 5) There is personal cultivation; and 6) There is sharing of harvests.


All these requisites must concur in order to create a tenancy relationship between the parties. The absence of one does not make an occupant of a parcel of land, or a cultivator thereof, or a planter thereon, a de jure tenant.

Therefore, the fact of sharing alone is not sufficient to establish a tenancy relationship. Certainly, it is not unusual for a landowner to accept some of the produce of his land from someone who plants certain crops thereon. This is a typical and laudable provinciano trait of sharing or patikim, a native way of expressing gratitude for favor received. This, however, does not automatically make the tiller-sharer a tenant thereof specially when the area tilled is only 60, or even 500, square meters and located in an urban area and in. the heart of an industrial or commercial zone at that. Tenancy status arises only if an occupant of a parcel of land has been given its possession for the primary purpose of agricultural production.

Agricultural production as the primary purpose being absent in the arrangement, it is clear that the private respondent was never a tenant of the former owner, Andrea Millenes. Consequently, Sec. 10 of RA of 3844, as amended, does not apply. Simply stated, the private respondent is not a tenant of the herein petitioner.

Hilario vs. IAC (G.R. No. 70736)

GUTIERREZ, JR., J.:

NATURE: This is a petition for review on certiorari of the Court of Appeals' decision declaring Salvador Baltazar a leasehold tenant entitled to security of tenure.

FACTS: Salvador Baltazar filed a verified complaint with the CAR in Bulacan alleging that since January, 1955 he had been in continuous possession as a share tenant of a 2 hectare land in San Miguel, Bulacan previously owned Socorro Vda. de Balagtas.

December 27, 1980 - spouses Hilario began to threaten him to desist from entering and cultivating a portion of the aforesaid land and committed acts in violation of his security of tenure

Hilarios plan to put up of a fence around the land and that unless restrained by the court, they would continue to do so to his great irreparable injury.

Baltazar claims that he became a tenant of Socorro P. Vda. de Balagtas by virtue of a "Kasunduan" executed on January 8, 1979

He built his house, and planted, produce of which was divided at 70-30 and 50-50 (sic) in his favor.

After Socorro died, he allegedly gave the share pertaining to the landowner to her daughter Corazon Pengzon.

In December, 1980 that he came to know that a portion of the 2 hectares is already owned by the Hilarios, who aver they acquired the landholding from PNB after it had been foreclosed by virtue of a deed of sale.

Corazon Pengzon testified that she owned only two lots, with a total area of 1,740 square meters. The other 2 lots were owned by Ruben Ocampo and Juan Mendoza. She further testified that in 1964 at the time of the partition of the property, she declared the property for classification purposes as "bakuran" located in the Poblacion and had no knowledge that there were other things planted in it except bananas and pomelos.

On November 27, 1981, CAR ruled that the land in question is not an agricultural landholding but plain "bakuran," hence, Baltazar is not a tenant on the land.

On January 30, 1982, the Court of Appeals, remanded the case to the lower court for further proceedings on the ground that the findings of CAR were not substantial.

In compliance with the order of the Court of Appeals, the CAR admitted additional evidence. CAR found that there was no tenancy relationship existing between Baltazar and the former owner, Corazon Pengzon.

Salvador Baltazar appealed to the then Intermediate Appellate Court (IAC), which reversed the decision.

ISSUE: W/N Baltazar is a tenant.

RULING: NO.We find no valid reason to deviate from the findings of the CAR. The evidence presented by the petitioners is more than sufficient to justify the conclusion that private respondent Salvador Baltazar is not a tenant of the landholding in question.

Corazon Pengson further explained that she did not receive any share from the produce of the land from 1964 up to the filing of the case and she would not have accepted any share from the produce of the land because she


knew pretty well that she was no longer the owner of the lot since 1974 when it was foreclosed by the bank and later on purchased by the spouses Hilarios.

We note the CAR's finding: Tenancy relationship is indivisible. The two-hectare land subject of plaintiff's alleged contract with Socorro Balagtas having been parcelled into seven (7) and possession thereof relinquished/surrendered in 1965 results in the termination of plaintiff's tenancy relationship with the previous owner/landholder. Such being the case, he cannot now claim that the landholding in question consisting of 4,000 square meters, more or less, is being cultivated by him under the old contract. The owner thereof Corazon Pengson has no tenancy relationship with him (plaintiff). (p. 25, Rollo)

From the foregoing, it is clear that Coraz• n Pengson did not give her consent to Baltazar to work on her land consisting of only 1,740 square meters.

And in the case of Tuazon v. Court of Appeals (118 SCRA 484), this Court had the occasion to explain:

xxx xxx xxx

... Tenancy is not a purely factual relationship dependent on what the alleged tenant does upon the land. It is also a legal relationship. The intent of the parties, the understanding when the farmer is installed, and, as in this case, their written agreements, provided these are complied with and are not contrary to law, are even more important."

The respondent court ruled that the fact that the land in question is located in the poblacion does not necessarily make it residential.

The conclusion is purely speculative and conjectural, We note that the evidence presented by the petitioners sufficiently establishes that the land in question is residential and not agricultural.

As we stated in Tiongson v. Court of Appeals (supra) "the key factor in ascertaining whether or not there is a landowner-tenant relationship in this case is the nature of the disputed property."

The respondent court also failed to note that the alleged tenant pays no rental or share to the landowners. Baltazar made a vague allegation that he

shared 70-30 and 50-50 of the produce in his favor. The former owner flatly denied that she ever received anything from him,

The requirements set by law for the existence of a tenancy relationship, to wit: (1) The parties are the landholder and tenant; (2) The subject is agricultural land; (3) The purpose is agricultural production; and (4) There is consideration; have not been met by the private respondent.

We held in Tiongson v. Court of Appeals, cited above that:

All these requisites are necessary in order to create tenancy relationship between the parties and the absence of one or more requisites do not make the alleged tenant a de facto tenant as contra-distinguished from a de jure tenant. This is so because unless a person has established his status as a dejure tenant, he is not entitled to security of tenure nor is he covered by the Land Reform Program of the Government under existing tenancy laws ... (emphasis supplied).

o Qua vs CA (G.R. No. 95318) – Personal Cultivation

FACTS: [O]n July 17, 1986, petitioner Lourdes Peña Qua filed a complaint

for ejectment with damages against private respondents claiming that she is the owner of a parcel of residential land in Albay, with an area of 346 square meters, registered in her name. Inside the land in question is an auto repair shop and three houses, all owned by private respondents; and that said respondents' stay in the land was by mere tolerance and they are in fact nothing but squatters who settled on the land without any agreement, paying no rent to her, nor realty taxes to the government.

Private respondent Carmen Carillo, surviving spouse of the late Salvador Carillo (and [respectively the] mother and mother-in-law of the other [private] respondents), alleged that the lot in question is a farm lot [home lot] because she and her late husband were tenants of the same including the two other lots adjoining the lot which also belong to petitioner; that as tenants, they could not just be ejected without cause; that it was not petitioner who instituted them as tenants in the land in question but the former owner, Leovigildo Peña who permitted the construction of the auto repair shop, the house of Carmen Carillo and the other two houses.

MC ruled against Carillo and ordered them to vacate and remove house and repairshop, and pay petitioner’s attorney’s fees and monthly rental of P200.


On appeal, the case was dismissed, finding Carillo to be an agricultural tenant.

ISSUE: whether or not private respondents possess the status of agricultural tenants entitled to, among others, the use and possession of a home lot.

RULING: NO. Regional Trial Court 6 made the following observations:

The land in question is a measly three hundred forty six (346) square meters and adjoining another two (2) lots which are separately titled having two thousand four hundred thirteen (2,413) square meters and eight thousand two hundred ninety eight (8,298) square meters –– the three (3) lots having a total area of eleven thousand fifty seven (11,057) square meters, more or less, or over a hectare of land owned by the plaintiff or by her predecessors-in-interest.

In the 346 square meters lot stand (sic) four (4) structures, [to wit]: an auto repair shop, a house of [private respondent] Carmen Carillo and two (2) other houses owned or occupied by the rest of the [private respondents] . . .; in other words, the [private respondents] almost converted the entire area as their home lot for their personal aggrandizement, believing that they are all tenants of the [petitioner].

Claimed, the defendants planted five hundred (500) coconut trees and only fifty (50) coconut trees survived in the land in question and/or in the entire area of the three lots. Such an evidence (sic) is very untruthful, unless it is a seed bed for coconut trees as the area is so limited. But found standing in the area in question or in the entire three (3) lots are only seven (7) coconut trees, the harvest of which is [allegedly] 2/3 share for the [petitioner] and the 1/3 share for the [private respondents]. The share, if ever there was/were, could not even suffice [to pay] the amount of taxes of the land (sic) paid

religiously by the [petitioner] yearly. 7 (Emphasis supplied.)

It is clear from the foregoing that the source of livelihood of private respondents is not derived from the lots they are allegedly tenanting. This conclusion is further supported by private respondent Carmen Carillo's assertion that the auto repair shop was constructed with the consent of petitioner's predecessor-in-interest for whom her husband served as a driver-mechanic. 8

From private respondents' manner of caring for the lots, it is also apparent that making the same agriculturally viable was not the main purpose of their occupancy, or else they should have immediately replanted coconut trees in place of those that did not survive. Indeed, the location of their auto repair shop being near the poblacion and along the highway, private respondents

chose to neglect the cultivation and propagation of coconuts, having earned, through the automobile repair shop, more than enough not only for their livelihood but also for the construction of two other dwelling houses thereon. It is also intimated by the Regional Trial Court that there is no direct evidence to confirm that the parties herein observed the sharing scheme allegedly set-up between private respondents and petitioner's predecessor-in-interest.

The essential requisites set by law for the existence of a tenancy relationship, thus: (1) the parties are the landowner and the tenant; (2) the subject is agricultural land; (3) the purpose is agricultural production; and (4) there is

consideration. 12 It is also understood that (5) there is consent to the tenant to

work on the land, that (6) there is personal cultivation by him and that the consideration consists of sharing the harvest. 13

Under the foregoing, private respondent Carmen Carillo is not entitled to be considered an agricultural tenant. Therefore, she may be not allowed the use of a home lot, a privilege granted by Section 35 of Republic Act No. 3844, as amended, in relation to Section 22 (3) of Republic Act No. 1199, as

amended, 16 only to persons satisfying the qualifications of agricultural tenants of coconut lands.

o Guerrero vs. CA (G.R. No. L-44570) – Cultivation

FACTS: In 1969, plaintiff Apolinario Benitez was taken by defendants-

spouses Manuel and Maria Guerrero to care for their 60 cows, crazing within their 21-hectare coconut plantation in Aurora, Quezon. Benitez was allowed to put up a hut where he and his family stayed. In addition to attending to the cows, he also cleaned the fruitbearing coconut trees, burn dried leaves and grass and to do such other similar chores. During harvest time, he picked coconuts and gather the fallen ones from a 16-hectare portion of the 21-hectare plantation. He had to husk and split the nuts and then process its meat into copra. For his work related to the coconuts, he shared 1/3 of the proceeds from the copra he processed and sold in the market. For attending to the cows he was paid P500 a year.

Sometime in 1973, plaintiff was refrained from gathering nuts from the 10-hectare portion where he used to gather nuts. He felt aggrieved and he brought the matter to the attention of the Office of Special Unit in the Office of the President. This led to an execution of an agreement, now marked as Exh. D, whereby defendants agreed, to let plaintiff work on the 16-hectare portion of the plantation as tenant guided by the provisions of republic Act No. 1199.


In July, 1973, he was again refrained from gathering nuts from the 10-hectare portion of the plantation with threats of bodily harm if he persists.The Guerreros, then assigned defendants Rogelio and Paulino Latigay to do the gathering of the nuts and the processing thereof into copra. Guerreros also caused to be demolished a part of the cottage where plaintiff and his family lived, thus, making plaintiffs feel that they (defendants) meant business. Hence, this case for reinstatement with damages.

ISSUE: Whether or not plaintiff is the tenant on the coconut landholding in question

RULING: YES. Records establish the private respondents' status as agricultural tenants under the legal definitions.

Respondent Benitez has physically possessed the landholding continuously from 1969 until he was ejected from it. Such possession of longstanding is an essential distinction between a mere agricultural laborer and a real tenant within the meaning of the tenancy law (Moreno, Philippine Law Dictionary, 1972 Edition), a tenant being one who, has the temporary use and occupation of land or tenements belonging to another (Bouvier's Law Dictionary, Vol. II, p. 3254) for the purpose of production (Sec. 3, Republic Act 1199; delos Reyes vs. Espinelli, 30 SCRA 574). Respondent Benitez lives on the landholding. He built his house as an annex to the petitioner's copra kiln. A hired laborer would not build his own house at his expense at the risk of losing the same upon his dismissal or termination any time. Such conduct is more consistent with that of an agricultural tenant who enjoys security of tenure under the law.

Cultivation is another important factor in determining the existence of tenancy relationships. The mere fact that it was not respondent Benitez who had actually seeded the land does not mean that he is not a tenant of the land. The definition of cultivation is not limited merely to the tilling, plowing or harrowing of the land. It includes the promotion of growth and the care of the plants, or husbanding the ground to forward the products of the earth by general industry. The raising of coconuts is a unique agricultural enterprise. Unlike rice, the planting of coconut seedlings does not need harrowing and plowing. Holes are merely dug on the ground of sufficient depth and distance, the seedlings placed in the holes and the surface thereof covered by soil. Some coconut trees are planted only every thirty to a hundred years. The major work in raising coconuts begins when the coconut trees are already fruitbearing. Then it is cultivated by smudging or smoking the plantation, taking care of the coconut trees, applying fertilizer, weeding and watering, thereby increasing the produce. The fact that respondent Benitez, together with his family, handles all phases of farmwork from clearing the landholding to the processing of copra, although at times with the aid of hired laborers,

thereby cultivating the land, shows that he is a tenant, not a mere farm laborer. (delos Reyes vs. Espinelli, supra Marcelo vs. de Leon, 105 Phil. 1175).

Further indicating the existence of a tenancy relationship between petitioners and respondent is their agreement to share the produce or harvest on a "tercio basis" that is, a 1/3 to 2/3 sharing in favor of the petitioner-landowners. Though not a positive indication of the existence of tenancy relations perse the sharing of harvest taken together with other factors characteristic of tenancy shown to be present in the case at bar, strengthens the claim of respondent that indeed, he is a tenant.

Once a tenancy relationship is established, the tenant has the right to continue working until such relationship is extinguished according to law.

It is true that leasehold tenancy for coconut lands and sugar lands has not yet been implemented. The policy makers of government are still studying the feasibility of its application and the consequences of its implementation. Legislation still has to be enacted. Nonetheless, wherever it may be implemented, the eventual goal of having strong and independent farmers working on lands which they own remains. The petitioners' arguments which would use the enactment of the Agrarian Reform Code as the basis for setting back or eliminating the tenurial rights of the tenant have no merit.

Right of security of tenure

- Cases:

o Talavera vs CA (G.R. No. 77830)

VOLUNTARY SURRENDER; Proof needed

FACTS: On July 10, 1984, an action for recovery of possession was instituted by the Laxamana against the petitioners over a parcel of agricultural land in Capas, Tarlac.

Respondent Laxamana alleged he had been a bonafide tenant of the land since 1958 until the petitioners took possession sometime in 1984. He had been in continuous possession and cultivation of the said landholding, 1958 but the petitioners, for unknown reasons and without the knowledge of respondent Laxamana, planted palay thereon in 1984 through force and intimidation after plowing and harrowing were done by respondent Laxamana; Due to their actions, Laxamana suffered damages in the amount of P500.00 and the price equivalent to sixty-five (65) cavans of palay per agricultural year from the time of his


dispossession until his reinstatement as tenant over the landholding in question.

Petitioners counter-alleged, among others, that their tenancy relationship with respondent Laxamana was terminated pursuant to a document captioned "Casunduan" executed on March 30, 1973 whereby the latter sold his rights and interests over the agricultural landholding under litigation for a consideration of P1,000.00. They claim Laxamana was not actually a tenant and whatever tenancy rights the former had exercised over the landholding in question were voluntarily surrendered by him upon the execution of the aforesaid document; that respondent Laxamana had only himself to blame for the litigation expenses resulting from his baseless and patently frivolous complaint; and that respondent Laxamana was no longer entitled to the amount equivalent to 65 cavans of palay per agricultural year as claimed since he was no longer a tenant of the petitioners.

After trial, the private respondent obtained a favorable judgment from which the petitioners appealed to the respondent Court. CA affirmed the lower court's holding that the Casunduan even if assumed to be valid did not constitute "voluntary surrender" as contemplated by law, hence, respondent Laxamana ought to be reinstated as tenant of the petitioners' landholding.

ISSUE: W/N Laxamana is entitled to reinstatement, through security of tenure; W/N tenancy relations were extinguished by voluntary surrender.

RULING: YES; NO. The evidence on record and the petitioners' arguments are not enough to overcome the rights of the private respondent provided in the Constitution and agrarian statutes which have been upheld by this Court.

The very essence of agricultural tenancy lies in the cardinal rule that an agricultural tenant enjoys security of tenurial status. The Code of Agrarian Reforms of the Philippines (Republic Act No. 3844, as amended) specifically enumerates the grounds for the extinguishment of agricultural leasehold relations.

The petitioners invoke voluntary surrender under Paragraph 2 of Section 8 as the reason for the end of the tenancy relationship.

Voluntary surrender, as a mode of extinguishment of tenancy relations, does not require any court authorization considering that it involves the tenant's own volition. (see Jacinto v. Court of Appeals, 87 SCRA 263 [1978]). To protect the tenant's right to security of tenure, voluntary surrender, as contemplated by law, must be convincingly and sufficiently proved by competent evidence. The tenant's intention to surrender the landholding cannot be presumed, much less determined by mere implication. Otherwise, the right of a tenant to security of tenure becomes an illusory one.

Tenancy relations cannot be bargained away except for the strong reasons provided by law which must be convincingly shown by evidence in line with the State's policy of achieving a dignified existence for the small farmers free from pernicious institutional restraints and practices (Sec. 2 [2], Code of Agrarian Reforms).

We, therefore, rule that except for compelling reasons clearly proved the determination that a person is a tenant-farmer, a factual conclusion made by the trial court on the basis of evidence directly available to it, will not be reversed on appeal and will be binding on us. (see Macaraeg v. Court of Appeals, G.R. No. 48008, January 20, 1989; Co v. Intermediate Appellate Court, 162 SCRA 390 [1988]).

o Endaya vs. CA (G.R. No. 88113)

ROMERO, J p:

FACTS: The Spouses Natividad Trinidad and Cesar San Diego owned a piece of agricultural land of 20,200 square meters in Batangas, devoted to rice and corn. As far back as 1934, private respondent Fideli has been cultivating this land as a tenant under a fifty-fifty (50-50) sharing agreement.

On May 2, 1974, a lease contract was executed between the Spouses San Diego and one Regino Cassanova for a period of four years .The lease contract obliged Cassanova to pay P400.00 per hectare per annum and gave him the authority to oversee the planting of crops on the land.

4 Private respondent signed this lease contract as one of two

witnesses. 5


The lease contract was subsequently renewed to last until May 1980 but the rental was raised to P600.00. Again, private respondent signed the contract as witness.

6

During the entire duration of the lease between the Spouses San Diego and Cassanova, Fideli continuously cultivated the land, sharing equally with Cassanova the net produce of the harvests.

On January 6, 1980, the Spouses San Diego sold the land to petitioners for P26,000.00, registered with the Register of Deeds of Batangas and a TCT was duly issued.

Private respondent Fideli continued to farm though petitioners claim he was told immediately after the sale to vacate. Private respondent deposited with the Luzon Development Bank an amount of about P8,000.00 as partial payment of the landowner's share in the harvests for the years 1980 until 1985.

Due to petitioners' persistent demand for Fideli to vacate he filed in April 1985 a complaint

with the RTC praying that he be declared the

agricultural tenant of petitioners. RTC ruled in favor of the spouses. CA reversed the decision.

ISSUE: W/N Fideli is an agricultural lessee.

RULING: YES.

R.A. No. 3844 (1963), as amended by R.A. No. 6839 (1971), which is the relevant law governing the events at hand, abolished share tenancy throughout the Philippines from 1971 and established the agricultural leasehold system by operation of law.

11 Section 7 of the said

law gave agricultural lessees security of tenure by providing the following: "The agricultural leasehold relation once established shall confer upon the agricultural lessee the right to continue working on the landholding until such leasehold relation is extinguished. The agricultural lessee shall be entitled to security of tenure on his landholding and cannot be ejected therefrom unless authorized by the Court for causes herein provided."

12

The fact that the landowner entered into a civil lease contract over the subject landholding and gave the lessee the authority to oversee the farming of the land, as was done in this case, is not among the causes

provided by law for the extinguishment of the agricultural leasehold relation.

13 On the contrary, Section 10 of the law provides:

"SECTION 10. Agricultural Leasehold Relation Not Extinguished by Expiration of Period, etc. — The agricultural leasehold relation under this code shall not be extinguished by mere expiration of the term or period in a leasehold contract nor by the sale, alienation or transfer of the legal possession of the landholding. In case the agricultural lessor sells, alienates or transfers the legal possession of the landholding, the purchaser or transferee thereof shall be subrogated to the rights and substituted to the obligations of the agricultural lessor."

Hence, transactions involving the agricultural land over which an agricultural leasehold subsists resulting in change of ownership,e.g., sale, or transfer of legal possession, such as lease, will not terminate the rights of the agricultural lessee who is given protection by the law by making such rights enforceable against the transferee or the landowner's successor in interest.

In the instant case, private respondent has been cultivating the subject farm landholding with a fifty-fifty (50-50) sharing arrangement with the Spouses San Diego, petitioners' predecessors-in-interest. The passage of R.A. 6839 in 1971, amending R.A. 3844 (1963), secured to private respondent all the rights pertaining to an agricultural lessee. The execution of a lease agreement between the Spouses San Diego and Regino Cassanova in 1974 did not terminate private respondent's status as an agricultural lessee. The fact that private respondent knew of, and consented to, the said lease contract by signing as witness to the agreement may not be construed as a waiver of his rights as an agricultural lessee. On the contrary, it was his right to know about the lease contract since, as a result of the agreement, he had to deal with a new person instead of with the owners directly as he used to. No provision may be found in the lease contract and the renewal contract even intimating that private respondent has waived his rights as an agricultural lessee.

It is true that the Court has ruled that agricultural tenancy is not created where the consent of the true and lawful owners is absent.

20 But

this doctrine contemplates a situation where an untenanted farm land is cultivated without the landowner's knowledge or against her will or although permission to work on the farm was given, there was no intention to constitute the worker as the agricultural lessee of the farm


land. 21

The rule finds no application in the case at bar where the petitioners are successors-in-interest to a tenanted land over which an agricultural leasehold has long been established. The consent given by the original owners to constitute private respondent as the agricultural lessee of the subject landholding binds private respondents who, as successors-in-interest of the Spouses San Diego, step into the latter's shoes, acquiring not only their rights but also their obligations.

22

o Milestone Realty vs CA (G.R. No. 135999) –

succession

QUISUMBING, J p:

FACTS: Spouses Alfonso Olympia and Carolina Zacarias and Spouses Claro Zacarias and Cristina Lorenzo were the co-owners of an agricultural land identified as Lot 616 of the Malinta Estate, in Valenzuela City. Eventually, Carolina became the owner of the property by virtue of a Deed of Extrajudicial Settlement executed by the heirs of Alfonso Olympia, one of whom is Francisco Olympia, on their respective shares after Alfonso's death and by an Affidavit of Settlement executed by the spouses Claro and Cristina Zacarias on their shares in the property.

Meanwhile, Anacleto Peña who was a tenant of the property and a holder of a Certificate of Agricultural Leasehold issued on February 23, 1982, had a house constructed on the lot. He had several children on the first marriage, among whom are Emilio Peña and Celia Segovia, who also had their houses constructed on the property. On February 4, 1986, Anacleto, who was already 78 years old and a widower, married Delia Razon, then only 29 years old. On February 17, 1990, Anacleto died intestate and was survived by Delia and his children in his first marriage, including Emilio.

Emilio and Delia, the latter with the help of respondent Raymundo Eugenio, her son-in-law, continued tilling and cultivating the property. On January 22, 1992, Emilio signed a handwritten declaration that he was the tenant in the land and he was returning the landholding to Carolina Zacarias in consideration of the sum of P1,500,000 as "disturbance compensation". He initially opted for a 1,000 square meter homelot but later changed his mind. After receipt of the money, he executed a "Katibayang Paglilipat ng Pag-mamay-ari".

In the meantime, petitioner William Perez, Joseph Lim, Willy Lim, Winston Lim, Edgar Lim, and Jaime Lim established Milestone as incorporators, in order to acquire and develop the aforesaid property and the adjacent parcel, Lot No. 617 of the Malinta Estate.

On July 30, 1992, Carolina Zacarias executed a deed of sale transferring the Lot No. 616 to petitioner Milestone. On the same date, the adjoining Lot No. 617 was issued under the name of petitioner William Perez who subsequently sold the same to Milestone. Thus, Milestone became the owner of the adjoining lots, Lot Nos. 616 and 617 of the Malinta Estate with a total area of three (3) hectares. Development of the property then commenced.

On October 13, 1992, private respondents Delia Razon Peña and Raymundo Eugenio filed a complaint against Emilio Peña, Carolina Zacarias and her brother Francisco Olympia, and William Perez with the PARAD, which was amended on January 6, 1993 to implead Milestone as respondent, praying inter alia to declare as null and void the sale by Carolina to Perez and by the latter to Milestone, and to recognize and respect the tenancy of private respondents Delia and Raymundo.

Carolina Zacarias declared that she chose Emilio Peña as her tenant-beneficiary on the said property within 30 days after the death of Anacleto, conformably with Section 9 of Republic Act No. 3844. PARAD dismissed the complaint, ruling that the order of preference cited in Section 9 of Republic Act 3844 is not absolute and may be disregarded for valid cause.

6 It also took note that Emilio's two siblings have openly

recognized Emilio as the legitimate successor to Anacleto's tenancy rights.

7

Delia Razon Peña and Raymundo Eugenio appealed from the PARAD's decision to the DARAB. On September 5, 1995, the DARAB reversed the decision, and CA affirmed.

ISSUE: W/N Delia Razon Peña has a right of first priority over Emilio Peña in succeeding to the tenancy rights of Anacleto over the subject landholding.

RULING: YES. As found by both the DARAB and the Court of Appeals, Carolina had failed to exercise her right to choose a substitute for the deceased tenant, from among those qualified, within the statutory period.


Section 9 of Republic Act No. 3844 is clear and unequivocal in providing for the rules on succession to tenancy rights. A close examination of the provision leaves no doubt as to its rationale of providing for continuity in agricultural leasehold relation in case of death or incapacity of a party. To this end, it provides that in case of death or permanent incapacity of the agricultural lessee to work his landholding, the leasehold shall continue between the agricultural lessor and the person who can cultivate the landholding personally. In the same vein, the leasehold shall bind the legal heirs of the agricultural lessor in case of death or permanent incapacity of the latter.

It is to achieve this continuity of relationship that the agricultural lessor is mandated by law to choose a successor-tenant within one month from the death or incapacity of the agricultural lessee from among the following: (1) surviving spouse; (2) eldest direct descendant by consanguinity; or (3) the next eldest direct descendant or descendants in the order of their age. Should the lessor fail to exercise his choice within one month from the death of the tenant, the priority shall be in accordance with the aforementioned order.

Applying Section 9 of Republic Act 3844, in the light of prevailing jurisprudence, it is undeniable that respondent Delia Razon Peña, the surviving spouse of the original tenant, Anacleto Peña, is the first in the order of preference to succeed to the tenancy rights of her husband because the lessor, Carolina Zacarias, failed to exercise her right of choice within the one month period from the time of Anacleto's death.

Petitioners cannot find succor in the declarations of Emilio Peña and the affidavit of Carolina Zacarias, stating that Emilio succeeded to the tenancy rights of Anacleto. In the first place, Carolina's affidavit and her Answer filed before the PARAD were both executed in 1992, or almost two years after the death of Anacleto on February 17, 1990, way beyond the one month period provided for in Section 9 of Republic Act 3844. Secondly, as found by the DARAB, a scrutiny of Carolina's declaration will show that she never categorically averred that she made her choice within the one (1) month period. Instead, she narrated passively that "when Anacleto died, the right of the deceased was inherited by Emilio Peña," prompting the DARAB to conclude it merely "connotes that she recognized Emilio Peña by force of circumstance under a nebulous time frame."

22

Petitioners further argue that Delia cannot qualify as tenant even on the assumption that she was the rightful successor to Anacleto's tenancy rights, because she did not personally cultivate the land and did not pay rent. In essence, petitioners urge this Court to ascertain and evaluate certain material facts which, however are not within the province of this Court to consider in a petition for review. Determination of personal cultivation and rental payments are factual issues beyond the reach of this petition. Well established is the rule that in an appeal via certiorari, only questions of law may be reviewed.

23

In the case at bar, it is undisputed that Carolina became the absolute owner of the subject landholding by virtue of Deed of Extrajudicial Settlement and Affidavit of Settlement executed by the other heirs of Alfonso Olympia and Spouses Claro and Cristina Zacarias. As the owner, it is within her right to execute a deed of sale of said landholding, without prejudice however to the tenancy rights and the right of redemption of Delia Razon Peña. In Manuel,

26 we held that the tenancy relationship is

not affected or severed by the change of ownership. The new owner is under the obligation to respect and maintain the tenant's landholding. In turn, Delia Razon Peña, as the successor tenant, has the legal right of redemption. This right of redemption is statutory in character. It attaches to a particular landholding by operation of law.

27

o Villaviza vs Panganiban (G.R. No. L-19760) –

Prescription of action

A tenant's right to be respected in his tenure under Republic Act 1199, as amended, is an obligation of the landholder created by law, and an action for violation thereof prescribes in ten years under No. 2 of Article 1144 of the Civil Code.

Under section 27 (1) of Republic Act 1199, as amended, an illegally ejected tenant's earnings elsewhere may not be deducted from but is to be added to the damages granted him upon reinstatement.

REYES, J.B.L., J.:

FACTS: The lower court found that the respondents (petitioners below) were tenants since 1944 in a Riceland in Nueva Ecija owned by Domingo Fajardo. Fajardo gave out the land for lease (civil lease) to the petitioner, Quirino Capalad, starting with the crop year 1955-56. The said lessee, in June, 1955, plowed the land by machinery, and installed, as


his tenants his co-petitioners, so that when the respondents went back to their respective landholdings to prepare them for planting they found the land already cultivated. The respondents-tenants demanded their reinstatement, but everytime they did, which they did yearly until the present suit was filed, Quirino Capalad promised but never fulfilled, to reinstate them for the agricultural year following said demands.

ISSUE: W/N the respondent tenants have security of tenure, and should be reinstated.

RULING: YES. A tenant's right to be respected in his tenure under Republic Act 1199, as amended, is an obligation of the landholder created by law, and an action for violation thereof prescribes in ten years under No. 2 of Article 1144 of the Civil Code. The respondents were ousted from their landholdings in June, 1955, they filed the present action on 31 March 1960; therefore, the period of limitation had not expired.

The tenancy court found that the ejected tenants-respondents have engaged in gainful occupations since their illegal ejectment and had delayed the filing of the case, and for these reasons the court made an award for damages against Quirino Capalad equivalent to only two harvests based on the landholder's share for the crop year 1954-1955.

The premises for the award are erroneous. Under section 27(1) of Republic Act 1199, as amended, a tenant's earnings may not be deducted from the damages because the said section positively provides that the tenant's freedom to earn elsewhere is to be added ("in addition") to his right to damages in case of illegal ejectment (Lustre, et al. vs. CAR, et al., L-19654, March 21, 1964). Nor can it be said that the respondents-tenants are guilty of laches for having unnecessarily delayed to Capalad's promises to reinstate them.

The amount of the award to each respondent should not, however, be disturbed because the respondents' non-appeal from the decision indicates their satisfaction therewith and a waiver of any amounts other than those indicated in the decision (David V. de la Cruz, et al., L-11656, 18 April 1958; Dy, et al. vs. Kuizon, L-16654, 30 Nov. 1961).

Right of pre-emption and redemption

- Case: Basbas vs Entena (G.R. No. L-21812)

REYES, J.B.L., J.:

Paz Torres and Enrique Torres were co-owners pro indiviso of a lot and building in Cebu City, that they inherited from their parents. Enrique sold his half interest in Sept. 1949 to the Raffiñan spouses for P13,000, with right to repurchase within 1 year. Subsequent advances by the vendees a retro increased their claims against Enrique Torres, and finally, on April 3, 1951 (6 months after expiration of the right to repurchase), said Enrique executed a deed of absolute sale of the same half interest in favor of the Raffiñans for P28,000.

Paz Torres de Conejero (sister), and her spouse did not know about this, until August 1952, when Enrique showed his brother-in-law, Enrique Conejero

1, a copy of the deed of absolute sale of his share. Conejero

went to the Raffinans and offered to redeem the share, for P29,000.00 and afterwards to P34,000.

Amicable settlement was not attained, so Conejeros filed, in October 1952, a complaint in the CFI of Cebu seeking entitlement to redeem the half interest. Raffiñans claim absolute title to the property pleading that plaintiffs lost their right of redemption as they failed to exercise it within the statutory period. CFI found the deed of sale to be an equitable mortgage and declared Conejero entitled to redemption for P34,000. CA reversed on appeal.

ISSUE: W/N plaintiffs Cornejo are entitled to redeem said half interest.

RULING: NO. While the co-owner's right of legal redemption (retracto legal de comuneras) is a substantial right, it is exceptional in nature, limited in its duration and subject to strict compliance with the legal requirements. One of theses is that the redemptioner should tender payment of the redemption money within 30 days from written notice of the sale by the co-owner, and, as we have ruled, the buyer of the co-owner's share can not be compelled, nor is he obligated, to accept payment in installments. Otherwise, the 30-day limitation fixed by law for the exercise of the right to redeem would be nullified, or be indefinitely evaded. If a partial payment can bind the purchaser, by what rule can the payment of the balance be determined?


Whether or not the petitioners exercised diligence in asserting their willingness to pay is irrelevant. Redemption by the co-owners of the vendor within 30 days is not a matter of intent, but is effectuated only by payment, or valid tender, of the price within said period. How the redemptioners raise the money is immaterial; timeliness and completeness of payment or tender are the things that matter.

The offer of the redemption price is not bona fide where it is shown that the offerer could not have made payment in due time if the offer had been accepted. Note that the co-owner's right to redeem, being granted by law, is binding on the purchaser of the undivided share by operation of law, and the latter's consent or acceptance is not required for the existence of the right of redemption. The only matter to be investigated by the courts, therefore, is the timely of the right, and the only way to exercise it is by a valid payment or tender within the 30 days prefixed by the Civil Code.

Lawful Consideration

- Case: Tan vs Pollescas (G.R. No. 145568) November 17, 2005

CARPIO, J.: FACTS: Petitioners, Tan Heirs, are co-owners of a coconut farmland in Ozamis City with an area of 25,780 sq. m. Esteban (Esteban) Pollescas was the original tenant of the Land. Upon his death in 1991, his son Enrique (Enrique) succeeded him and was appointed as tenant by the landowner Enrique Tan (TAN).

However, respondent Reynalda, Esteban’s surviving second

spouse, demanded that Tan recognize her as Esteban’s successor. Tan did not accede. Thus, Reynalda filed with the “DARAB-Ozamis” a complaint for Annulment of Compromise Agreement, Quieting of Tenancy Relationship and damages.

DARAB-Ozamis declared Reynalda as the lawful tenant of the

Land. The DARAB-Ozamis apportioned the harvests between the Tan Heirs and Reynalda based on the customary sharing system which is 2/3 to the landowner and 1/3 to the tenant.

On harvest dates, 11 and 19 of June, 9 September, 6 and 13 of

December 1993, Reynalda failed to deliver to the Tan Heirs 2/3 of the

harvests amounting toP3,656.70. The Tan Heirs demanded Reynalda to pay such amount, but was ignored.

Consequently, the Tan Heirs filed a for estafa against Reynalda

with the MTC of Ozamis, which found her guilty of estafa and sentenced her to 5 months of arresto mayor max. to 2 years of prision correccional minimum and ordered her to pay the Tan Heirs P3,656.70.

Subsequently, for Reynalda’s continued failure to deliver their

share, the Tan Heirs filed with the DARAB-Misamis Occidental an ejectment case, which was ruled in the favor of the Tan Heirs.

Aggrieved, Reynalda appealed to the DARAB, Diliman, QC,

which reversed the decision. The Tan Heirs appealed, but CA affirmed the decision of the

DARAB ordering the Tan Heirs to respect Reynalda’s possession and cultivation of the Land. ISSUE: W/N Reynalda’s failure to pay the Tan Heirs 2/3 share of harvests is a ground for ejectment. RULING: NO. Section 7 of RA 3844 as amended provides that once there is a leasehold relationship, as in the present case, the landowner cannot eject the agricultural tenant from the land unless authorized by the court for causes provided by law. RA 3844 as amended expressly recognizes and protects an agricultural leasehold tenant’s right to security of tenure.

[28]

In the instant case, the Tan Heirs seek Reynalda’s ejectment from the Land on the ground of non-payment of lease rental.

The Court agrees with the Court of Appeals that for non-payment of the lease rental to be a valid ground to dispossess the agricultural lessee of the landholding, the amount of the lease rental must first of all be lawful. If the amount of lease rental claimed exceeds the limit allowed by law, non-payment of lease rental cannot be a ground to dispossess the agricultural lessee of the landholding.

Section 34 of RA 3844 as amended

[29] mandates that “not x x x

more than” 25% of the average normal harvest shall constitute the just and fair rental for leasehold. In this case, the Tan Heirs demanded Reynalda to deliver 2/3 of the harvest as lease rental, which clearly

http://sc.judiciary.gov.ph/jurisprudence/2005/nov2005/145568.htm#_ftn28



exceeded the 25% maximum amount prescribed by law. Therefore, the Tan Heirs cannot validly dispossess Reynalda of the landholding for non-payment of rental precisely because the lease rental claimed by the Tan Heirs is unlawful.

Even assuming Reynalda agreed to deliver 2/3 of the harvest as

lease rental, Reynalda is not obliged to pay such lease rental for being unlawful. There is no legal basis to demand payment of such unlawful lease rental. The courts will not enforce payment of a lease rental that violates the law. There was no validly fixed lease rental demandable at the time of the harvests. Thus, Reynalda was never in default.

Reynalda and the Tan Heirs failed to agree on a lawful lease

rental. Accordingly, the DAR must first fix the provisional lease rental payable by Reynalda to the Tan Heirs pursuant to the second paragraph of Section 34 of RA 3844 as amended.

[30] Until the DAR has fixed the

provisional lease rental, Reynalda cannot be in default in the payment of lease rental since such amount is not yet determined. There can be no delay in the payment of an undetermined lease rental because it is impossible to pay an undetermined amount. That Reynalda is not yet in default in the payment of the lease rental is a basic reason why she cannot be lawfully ejected from the Land for non-payment of rental.

No ground for extinguishment of leasehold relation The Court also holds that there is no ground for the

extinguishment of leasehold relation in this case.

Share tenancy, abolition

- RA 1199, Sec 4 AN ACT TO GOVERN THE RELATIONS

BETWEEN LANDHOLDERS AND TENANTS OF

AGRICULTURAL LANDS (LEASEHOLDS AND SHARE

TENANCY)

- Agricultural Tenancy Act of the Philippines

Section 4. Systems of Agricultural Tenancy; Their Definitions. - Agricultural tenancy is classified into leasehold tenancy and share tenancy.

Share tenancy exists whenever two persons agree on a joint undertaking for agricultural production wherein one party furnishes the land and the other his labor, with either or both contributing any one or several of the items of production, the tenant cultivating the land personally with the aid of labor available from members of his immediate farm household, and the produce thereof to be divided between the landholder and the tenant in proportion to their respective contributions.

Leasehold tenancy exists when a person who, either personally or with the aid of labor available from members of his immediate farm household, undertakes to cultivate a piece of agricultural land susceptible of cultivation by a single person together with members of his immediate farm household, belonging to or legally possessed by, another in consideration of a price certain or ascertainable to be paid by the person cultivating the land either in percentage of the production or in a fixed amount in money, or in both.

- Cases:

o Hidalgo vs Hidalgo (G.R. No. L-25326) May 29, 1970

TEEHANKEE, J.:

FACTS: Respondent-vendor Policarpio Hidalgo was the owner of the 22,876-square meter and 7,638-square meter agricultural parcels of land situated in Lumil, San Jose, Batangas, described in the decisions under review.

In Case L-25326, Policarpio sold the 22,876-square meter land, with two other parcels of land for P4,000.00. Petitioners-spouses Igmidio Hidalgo and Martina Resales, tenants, alleged that the parcel worked by them is fairly worth P1,500.00, and seek to redeem the land for the same amount of P1,500.00 by respondents-vendees in their favor.

In Case L-25327, respondent-vendor sold the 7,638-square meter parcel of land for P750.00, and petitioners-spouses Hilario Aguila and Adela Hidalgo as tenants, seek to redeem the same for P750.00/

Petitioners-tenants have for several years been working on the lands as share tenants. No 90-day notice of intention to sell the lands for



the exercise of the right of pre-emption prescribed by section 11 of the Agricultural Land Reform Code (RA. 3844, enacted on August 8, 1963) was given by respondent-vendor to petitioners-tenants.

Deeds of Sale were registered by respondents register of deeds and provincial assessor of Batangas, notwithstanding the non-execution by Policarpio of the affidavit required by section 13 of the Land Reform Code. Actions for redemption were timely filled on March 26, 1965 by petitioners-tenants within the two-year prescriptive period from registration of the sale, prescribed by section 12.

Agrarian court dismissed both petitions for redemption."

ISSUE: W/N the right of redemption granted by Sec. 12 of Republic Act No. 3844 applicable to share tenants?

RULING: YES. The agrarian court therefore facilely let itself fall into the error of concluding that the right of redemption (as well as necessarily the right of pre-emption) imposed by the Code is available to leasehold tenants only and excludesshare tenants for the literal reason that the Code grants said rights only to the "agricultural lessee and to nobody else." For one, it immediately comes to mind that the Code did not mention tenants, whether leasehold or sharetenants, because it outlaws share tenancy and envisions the agricultural leasehold system as its replacement.

Thus, Chapter I of the Code, comprising sections 4 to 38, extensively deals with the establishment of "agricultural leasehold relation," defines the parties thereto and the rights and obligations of the "agricultural lessor" and of the "agricultural lessee" (without the slightest mention of leasehold tenants) and the statutory consideration or rental for the leasehold to be paid by the lessee. There is a studied omission in the Code of the use of the term tenant in deference to the "abolition of tenancy" as proclaimed in the very title of the Code, and the elevation of the tenant's status to that of lessee.

Then, the terms "agricultural lessor" and "agricultural lessee" are consistently used throughout the Chapter and carried over the particular sections (11 and 12) on pre-emption and redemption. The

agrarian court's literal construction would wreak havoc on and defeat the proclaimed and announced legislative intent and policy of the State of establishing owner-cultivatorship for the farmers, who invariably were all share tenants before the enactment of the Code and whom the Code would now uplift to the status of lessees.

6. Herein lies the distinction between the present case and Basbas vs. Entena 11 where the Court upheld the agrarian court's dismissal of the therein tenant's action to redeem the landholding sold to a third party by virtue of the tenant's failure to tender payment or consign the purchase price of the property. There, the tenant-redemptioner was shown by the evidence to have no funds and had merely applied for them to the Land Authority which was not yet operating in the locality and hence, the Court held that no part of the Code "indicates or even hints that the 2-year redemption period will not commence to run (indefinitely) until the tenant obtains financing from the Land Bank, or stops the tenant from securing redemption funds from some other source."

In the present case, the petitioners-tenants' possession of funds and compliance with the requirements of redemption are not questioned, the case having been submitted and decided on the sole legal issue of the right of redemption being available to them as share tenants. The clear and logical implication of Basbas is where the tenant has his own resources or secures redemption funds from sources other than the Land Bank or government agencies under the Code, the fact that the locality has not been proclaimed a land reform area and that such government machineries and agencies are not operating therein is of no relevance and cannot prejudice the tenant's rights under the Code to redeem the landholding.

The agrarian court's dismissal of the cases at bar should therefore be reversed and petitioners-tenants' right to redeem the landholdings recognized section 12 of the Code.

Since the agrarian court did not rule upon conflicting claims of the parties as to what was the proportionate worth of the parcel of land in the stated price of P4,000.00 — whether P1,500.00 as claimed by petitioners or a little bit more, considering the proportionate values of the two other parcels, but the whole total is not to exceed the stated price of P4,000.00, since the vendor is bound thereby — and likewise,


what was the additional proportionate worth of the expenses assumed by the vendees, assuming that petitioners are not willing to assume the same obligation, the case should be remanded to the agrarian court solely for the purpose of determining the reasonable price.

In Case L-25327, there is no question as to the price of P750.00 paid by the vendees and no additional consideration or expenses, unlike in Case L-25326, supra, assumed by the vendees. Hence, petitioners therein are entitled to redeem the landholding for the same stated price.

ACCORDINGLY, the decisions appealed from are hereby reversed, and the petitions to redeem the subject landholdings are granted.

Guerrero vs. CA (G.R. No. L-44570) May 30, 1986

GUTIERREZ, JR., J.:

FACTS: In 1969, plaintiff Apolinario Benitez was taken by defendants- spouses Manuel and Maria Guerrero to care for their 60 cows, crazing within their 21-hectare coconut plantation in Aurora, Quezon. Benitez was allowed to put up a hut where he and his family stayed. In addition to attending to the cows, he also cleaned the fruitbearing coconut trees, burn dried leaves and grass and to do such other similar chores. During harvest time, he picked coconuts and gather the fallen ones from a 16-hectare portion of the 21-hectare plantation. He had to husk and split the nuts and then process its meat into copra. For his work related to the coconuts, he shared 1/3 of the proceeds from the copra he processed and sold in the market. For attending to the cows he was paid P500 a year.

Sometime in 1973, plaintiff was refrained from gathering nuts from the 10-hectare portion where he used to gather nuts. He felt aggrieved and he brought the matter to the attention of the Office of Special Unit in the Office of the President. This led to an execution of an agreement, now marked as Exh. D, whereby defendants agreed, to let plaintiff work on the 16-hectare portion of the plantation as tenant guided by the provisions of republic Act No. 1199.

In July, 1973, he was again refrained from gathering nuts from the 10-hectare portion of the plantation with threats of bodily harm if he persists.The Guerreros, then assigned defendants Rogelio and Paulino Latigay to do the

gathering of the nuts and the processing thereof into copra. Guerreros also caused to be demolished a part of the cottage where plaintiff and his family lived, thus, making plaintiffs feel that they (defendants) meant business. Hence, this case for reinstatement with damages.

ISSUE: W/N there was a share tenancy between Guerrero and Benitez; If so, was it abolished by the passage of RA 3844.

RULING: YES; NO. "Share tenancy" exists whenever two persons agree on a joint undertaking for agricultural production wherein one party furnishes the land and the other his labor, with either or both contributing any one or several of the items of production, the tenant cultivating the land with the aid of labor available from members of his immediate farm household, and the produce thereof to be divided between the landholder and the tenant in proportion to their respective contributions (Sec. 4, RA 1199; Sec. 166(25) RA 3844, Agricultural Land Reform Code).

The repeal of the Agricultural Tenancy Act and the Agricultural Land Reform Code mark the movement not only towards the leasehold system but towards eventual ownership of land by its tillers. The phasing out of share tenancy was never intended to mean a reversion of tenants into mere farmhands or hired laborers with no tenurial rights whatsoever.

Respondent Benitez has physically possessed the landholding continuously from 1969 until he was ejected from it. He built his house as an annex to the petitioner's copra kiln.

Cultivation is another important factor in determining the existence of tenancy relationships. It is admitted that it had been one Conrado Caruruan, with others, who had originally cleared the land in question and planted the coconut trees, with the respondent coming to work in the landholding only after the same were already fruit bearing. The mere fact that it was not respondent Benitez who had actually seeded the land does not mean that he is not a tenant of the land. The definition of cultivation is not limited merely to the tilling, plowing or harrowing of the land. It includes the promotion of growth and the care of the plants, or husbanding the ground to forward the products of the earth by general industry. The raising of coconuts is a unique


agricultural enterprise. Unlike rice, the planting of coconut seedlings does not need harrowing and plowing.

The major work in raising coconuts begins when the coconut trees are already fruitbearing. Then it is cultivated by smudging or smoking the plantation, taking care of the coconut trees, applying fertilizer, weeding and watering, thereby increasing the produce. The fact that respondent Benitez, together with his family, handles all phases of farmwork from clearing the landholding to the processing of copra, although at times with the aid of hired laborers, thereby cultivating the land, shows that he is a tenant, not a mere farm laborer.

Further indicating the existence of a tenancy relationship between petitioners and respondent is their agreement to share the produce or harvest on a "tercio basis" that is, a 1/3 to 2/3 sharing in favor of the petitioner-landowners. Though not a positive indication of the existence of tenancy relations perse the sharing of harvest taken together with other factors characteristic of tenancy shown to be present in the case at bar, strengthens the claim of respondent that indeed, he is a tenant.

In most cases, we have considered the system of sharing produce as convincing evidence of tenancy relations.

Before we close this case, it is pertinent to reiterate that the respondent's right as share tenant do not end with the abolition of share tenancy. As the law seeks to "uplift the farmers from poverty, ignorance and stagnation to make them dignified, self-reliant, strong and responsible citizens ... active participants in nation-building", agricultural share tenants are given the right to leasehold tenancy as a first step towards the ultimate status of owner-cultivator, a goal sought to be achieved by the government program of land reform.

It is true that leasehold tenancy for coconut lands and sugar lands has not yet been implemented. The policy makers of government are still studying the feasibility of its application and the consequences of its implementation. Legislation still has to be enacted. Nonetheless, wherever it may be implemented, the eventual goal of having strong and independent farmers working on lands which they own remains. The petitioners' arguments which would use the enactment of the

Agrarian Reform Code as the basis for setting back or eliminating the tenurial rights of the tenant have no merit.

WHEREFORE, the petition is DISMISSED for lack of merit. The decision of the appellate court is AFFIRMED. No costs.

SO ORDERED.

Fernan, Alampay, Paras and Cruz, * JJ., concur.

Feria, J., took no part.

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