Hacienda Luisita vs PARC stock transfer in lieu of outright agricultural land transfer.
For FARM, this modality
Case Digest GR 171101 July 5 2011 Nov 22 2011
Facts:
In 1988, RA 6657 or the CARP law was passed. It is a program aimed at redistributing
public and private agricultural lands to farmers and farmworkers who are landless.
One of the lands covered by this law is the Hacienda Luisita, a 6,443-hectare mixed
agricultural-industrial-residential expanse straddling several municipalities of Tarlac.
Hacienda Luisita was bought in 1958 from the Spanish owners by the Tarlac
Development Corporation (TADECO), which is owned and/or controlled by Jose
Cojuanco Sr., Group. Back in 1980, the Martial Law administration filed an
expropriation suit against TADECO to surrender the Hacienda to the then Ministry of
Agrarian Reform (now DAR) so that the land can be distributed to the farmers at cost.
The RTC rendered judgment ordering TADECO to surrender Hacienda Luisita to the
MAR.
In 1988, the OSG moved to dismiss the governments case against TADECO. The CA
dismissed it, but the dismissal was subject to the condition that TADECO shall obtain
the approval of FWB (farm worker beneficiaries) to the SDP (Stock Distribution Plan)
and to ensure its implementation.
Sec 31 of the CARP Law allows either land transfer or stock transfer as two alternative
modes in distributing land ownership to the FWBs. Since the stock distribution scheme
is the preferred option of TADECO, it organized a spin-off corporation, the Hacienda
Luisita Inc. (HLI), as vehicle to facilitate stock acquisition by the farmers.
After conducting a follow-up referendum and revision of terms of the Stock
Distribution Option Agreement (SDOA) proposed by TADECO, the Presidential
Agrarian Reform Council (PARC), led by then DAR Secretary Miriam Santiago,
approved the SDP of TADECO/HLI through Resolution 89-12-2 dated Nov 21, 1989.
From 1989 to 2005, the HLI claimed to have extended those benefits to the
farmworkers. Such claim was subsequently contested by two groups representing the
interests of the farmers the HLI Supervisory Group and the AMBALA. In 2003, each
of them wrote letter petitions before the DAR asking for the renegotiation of terms
and/or revocation of the SDOA. They claimed that they havent actually received
those benefits in full, that HLI violated the terms, and that their lives havent really
improved contrary to the promise and rationale of the SDOA.
The DAR created a Special Task Force to attend to the issues and to review the terms
of the SDOA and the Resolution 89-12-2. Adopting the report and the
recommendations of the Task Force, the DAR Sec recommended to the PARC (1)
the revocation of Resolution 89-12-2 and (2) the acquisition of Hacienda Luisita
through compulsory acquisition scheme. Consequently, the PARC revoked the SDP
of TADECO/HLI and subjected those lands covered by the SDP to the mandated land
acquisition scheme under the CARP law. These acts of the PARC was assailed by HLI
via Rule 65.
On the other hand, FARM, an intervenor, asks for the invalidation of Sec. 31 of RA
6657, insofar as it affords the corporation, as a mode of CARP compliance, to resort to
of distribution is an anomaly to be annulled for being inconsistent with the basic
concept of agrarian reform ingrained in Sec. 4, Art. XIII of the Constitution.
Administrative Law
Issue 1: W/N PARC has the authority to revoke the Stock Distribution Plan or SDP
Yes. Under Sec. 31 of RA 6657, as implemented by DAO 10, the authority to approve
the plan for stock distribution of the corporate landowner belongs to PARC. It may be
that RA 6657 or other executive issuances on agrarian reform do not explicitly vest
the PARC with the power to revoke/recall an approved SDP, but such power or
authority is deemed possessed by PARC under the principle of necessary
implication, a basic postulate that what is implied in a statute is as much a part of it
as that which is expressed.
Following this doctrine, the conferment of express power to approve a plan for stock
distribution of the agricultural land of corporate owners necessarily includes the
power to revoke or recall the approval of the plan.
Constitutional Law
Issue 2: W/N the Court may exercise its power of judicial review over the
constitutionality of Sec 31 of RA 6657
No. First, the intervenor FARM failed to challenged the constitutionality of RA 6657,
Sec 31 at the earliest possible opportunity. It should have been raised as early as Nov
21, 1989, when PARC approved the SDP of HLI or at least within a reasonable time
thereafter.
Second, the constitutionality of RA 6657 is not the very lis mota of this case. Before
the SC, the lis mota of the petitions filed by the HLI is whether or not the PARC acted
with grave abuse of discretion in revoking the SDP of HLI. With regards to the
original positions of the groups representing the interests of the farmers, their very lis
mota is the non-compliance of the HLI with the SDP so that the the SDP may be
revoked. Such issues can be resolved without delving into the constitutionality of RA
6657.
Hence, the essential requirements in passing upon the constitutionality of acts of the
executive or legislative departments have not been met in this case.
Statutory Construction
Issue 3: W/N Sec 31 of RA 6657 is consistent with the Constitutions concept of
agrarian reform
Yes. The wording of the Art XIII, Sec 4 of the Constitution is unequivocal: the farmers
and regular farmworkers have a right to own directly or collectively the lands they till.
The basic law allows two (2) modes of land distribution: direct and indirect
ownership. Direct transfer to individual farmers is the most commonly used method
by DAR and widely accepted. Indirect transfer through collective ownership of the
agricultural land is the alternative to direct ownership of agricultural land by
individual farmers. Sec. 4 EXPRESSLY authorizes collective ownership by farmers.
No language can be found in the 1987 Constitution that disqualifies or prohibits
corporations or cooperatives of farmers from being the legal entity through which
collective ownership can be exercised.

The word collective is defined as indicating a number of persons or things considered

as constituting one group or aggregate, while collectively is defined as in a collective
sense or manner; in a mass or body. By using the word collectively, the Constitution
allows for indirect ownership of land and not just outright agricultural land transfer.
This is in recognition of the fact that land reform may become successful even if it is
done through the medium of juridical entities composed of farmers.

The stock distribution option devised under Sec. 31 of RA 6657 hews with the agrarian
reform policy, as instrument of social justice under Sec. 4 of Article XIII of the
Constitution. Albeit land ownership for the landless appears to be the dominant
theme of that policy, the Court emphasized that Sec. 4, Article XIII of the
Constitution, as couched, does not constrict Congress to passing an agrarian reform
law planted on direct land transfer to and ownership by farmers and no other, or else
the enactment suffers from the vice of unconstitutionality. If the intention were
otherwise, the framers of the Constitution would have worded said section in a
manner mandatory in character.

* The SC, through a resolution dated Nov 21 2011 of the motion for reconsideration
filed by HLI, affirmed the revocation of HLIs SDP and the placing of Hacienda
Luisita under the compulsory land distribution scheme of the CARP law. It was also
held that the date of taking was Nov 21 1989, when the PARC, by Resolution 89-12-2,
approved the SDP of HLI. ##
 G.R. No. 79416 September 5, 1989
ROSALINA BONIFACIO, surviving wife; and children GABRIEL, PONCIANO,
TIBURCIO, BEATRIZ, GENEROSA, SILVERIA, LEONARDO, FELOMENA,
ENCARNACION and LEONILA, all surnamed BONIFACIO,petitioners,
vs.
HON. NATIVIDAD G. DIZON, Presiding Judge of the Regional Trial Court of
Malolos, Branch XIII, Malolos, Bulacan and PASTORA SAN
MIGUEL, respondents.
FERNAN, C.J.:
The issue raised in the instant petition for certiorari certified to us by the Court of
Appeals in its resolution 1 dated November 28, 1986 in CA-G.R. SP No. 10033 as
involving a pure question of law is phrased by petitioners, thus:
WHETHER OR NOT, THE FAVORABLE JUDGMENT OBTAINED
BY THE DECEDENT IS INHERITED BY THE COMPULSORY
HEIRS, THEREBY VESTING TO THE LATTER, ALL THE RIGHTS
CONFERRED BY THE JUDGMENT TO (sic) THE DECEDENT. 2
The favorable judgment adverted to by petitioners traces its origin to the complaint
filed on July 1, 1968 by Olimpio Bonifacio before the then Court of Agrarian
Relations, Fifth Regional District, Branch I-A of Baliwag, Bulacan, seeking the
ejectment of private respondent Pastora San Miguel from Bonifacio's two-hectare
agricultural land situated at Patubig, Marilao, Bulacan and covered by Transfer
Certificate of Title No. T-27298. The ground relied upon therefor was personal
cultivation under Section 36 (1) of R.A. 3844, otherwise known as the Agricultural
Land Reform Code (CAR Case No. 2160-B'68).
After trial on the merits, judgment was rendered therein on September 18, 1970 by
Judge Manuel Jn. Serapio:
1. Granting authority to plaintiff OLIMPIO BONIFACIO to eject
defendant PASTORA SAN MIGUEL from the landholding in
question situated at Patubig, Marilao, Bulacan with an area of two
(2) hectares, more or less, and consequently, ordering said
defendant to vacate the same landholding and deliver possession
thereof to said plaintiff for the latter's personal cultivation, subject
to the provisions of Section 25 of R.A. 3844; and
2. Dismissing all other claims and counterclaims of the parties. 3
On appeal by private respondent Pastora San Miguel, the Court of
Appeals 4 modified said judgment with respect to her counterclaim by ordering
Olimpio Bonifacio to pay her the amount of P 1,376.00. The judgment was affirmed in
all other respects. 5
Still dissatisfied, private respondent Pastora San Miguel sought relief from this Court.
During the pendency of her petition, on August 7, 1983, Olimpio Bonifacio died. As
no notice of such death was given to the Court, no order for the substitution of his
heirs was made. On July 31, 1985, the Court En Banc resolved to deny private
respondent's petition for lack of merit and to affirm the decision of the Court of
Appeals. 6
Subsequently, petitioners Rosalina Bonifacio, as surviving wife, and Gabriel,
Ponciano, Tiburcio, Beatriz, Generosa, Silveria, Leonardo, Felomena, Encarnacion and
Leonila all surnamed Bonifacio, as children and heirs of Olimpio Bonifacio, moved
for the execution of the decision in CAR Case No. 2160-B'68 before the respondent
Regional Trial Court of Bulacan. A writ of execution was issued on February 20, 1986
and on March 6, 1986, the Deputy Sheriff submitted his Report (Partial Delivery of
Possession), stating in part that except for a portion thereof occupied by the house of
Pastora San Miguel which the latter refused to vacate, he had delivered the land
subject matter of the action to Rosalina Bonifacio as surviving wife of Olimpio
Bonifacio.
Thereafter, private respondent Pastora San Miguel moved to quash the writ of
execution. This was opposed by petitioners who in turn sought the issuance of a writ
of demolition and an order declaring Pastora San Miguel in contempt of court for
allegedly re-entering the subject land.
After hearing, respondent Judge Natividad G. Dizon issued a resolution on July 15,
1986, the dispositive portion of which reads:
WHEREFORE, the implementation of the writ of execution of the
Decision dated September 18, 1970 made by the Sheriff of this
Court, per directive contained in our Order of February 18, 1986, is
hereby declared null and void; the "Motion for Demolition" filed by
plaintiff is hereby denied; and, the "Petition for Contempt" likewise
denied.
SO ORDERED. 7
Petitioners assail this resolution in the petition for certiorari filed before the Court of
Appeals, which as stated earlier, was certified to us pursuant to Section 9 (3) of Batas
Pambansa Blg. 129 in relation to Section 5 (2) [e], Art. X of the 1973 Constitution and
Rule 50, Sec. 3 of the Revised Rules of Court.
Petitioners contend that respondent judge committed grave abuse of discretion
tantamount to lack of jurisdiction in ruling that the decision in CAR Case No. 2160-
B'68 can no longer be executed as said action is purely personal in character and
therefore cannot, upon Olimpio Bonifacio's death, be inherited by his heirs. They
assert that CAR Case No. 2160-B'68, being an ejectment case and not one of those
specifically provided by law to be purely personal, survives the death of a party.
Furthermore, as under Rule 39, Section 49 (b) of the Rules of Court, a judgment is
binding not only upon the parties but also on their successors-in-interest, petitioners
are entitled to enforce the decision in CAR Case No. 2160-B'68.
Private respondent, on the other hand, places stress on the fact that the action under
consideration is not an ordinary ejectment case but an agrarian case for the ejectment
of an agricultural lessee. She theorizes that the right being asserted in the action is
personal to Olimpio Bonifacio, which necessarily died with him. She further contends
that the non-substitution of Olimpio Bonifacio by his heirs rendered the proceedings
taken after his death null and void. She also points to certain supervening events
which allegedly prohibit execution of the judgment in CAR Case No. 2160-B'68, to
wit: the amendment of Section 36 (1), R.A. 3844 by R.A. No. 6389 and 2) the
promulgation of P.D. No. 27.
Private respondent is correct in characterizing CAR Case No. 2160-B'68 as more than
an ordinary ejectment case. It is, indeed, an agrarian case for the ejectment of an
agricultural lessee, which in the light of the public policy involved, is more closely
and strictly regulated by the State. This factor, however, does not operate to bar the
application to the instant case of the general rule that an ejectment case survives the
death of a party. 8
Much of the problem lies in the term "personal cultivation" by which the ground for
ejectment under Section 36 (1) of R.A. 3844 was loosely referred. As it is, the term
gave the impression that the ejectment of an agricultural lessee was allowed only if
and when the landowner-lessor and no other opted to cultivate the landholding;
thereby giving use to a bigger misconception that the right of cultivation pertained
exclusively to the landowner-lessor, and therefore his personal right alone. A reading
of Section 36 (1), R.A. 3844 however readily demonstrates the fallacy of this
interpretation. Said section provides:
Sec. 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 the 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 . . . .
Under this provision, ejectment of an agricultural lessee was authorized not only
when the landowner-lessor desired to cultivate the landholding, but also when a
member of his immediate family so desired. In so providing, the law clearly did not
intend to limit the right of cultivation strictly and personally to the landowner but to
extend the exercise of such right to the members of his immediate family. Clearly
then, the right of cultivation as a ground for ejectment was not a right exclusive and
personal to the landowner-lessor. To say otherwise would be to put to naught the
right of cultivation likewise conferred upon the landowner's immediate family
members.
The right of cultivation was extended to the landowner's immediate family members
evidently to place the landowner-lessor in parity with the agricultural lessee who was
(and still is) allowed to cultivate the land with the aid of his farm household. In this
regard, it must be observed that an agricultural lessee who cultivates the landholding
with the aid of his immediate farm household is within the contemplation of the law
engaged in "personal cultivation."
Thus, whether used in reference to the agricultural lessor or lessee, the term "personal
cultivation" cannot be given a restricted connotation to mean a right personal and
exclusive to either lessor or lessee. In either case, the right extends to the members of
the lessor's or lessee's immediate family members.
Petitioners are not only the heirs and successors-in-interest, but the immediate family
members of the deceased landowner-lessor as well. The right to cultivate the
landholding asserted in CAR Case No. 2160-B'68 not being a purely personal right of
the deceased landowner-lessor, the same was transmitted to petitioners as heirs and
successors-in-interest. Petitioners are entitled to the enforcement of the judgment in
CAR Case No. 2160-B'68.
Rules of procedure make it the duty of the attorney to inform the court promptly of
his client's death, incapacity or incompetency during the pendency of the action and
to give the name and residence of his executor, administrator, guardian or other legal
representative. 9 In case of a party's death, the court, if the action survives, shall then
order upon proper notice the legal representatives of the deceased to appear and to
be substituted for the deceased within a period of 30 days or within such time as may
be granted. 10
In the case at bar, Olimpio Bonifacio's death during the pendency of private
respondent's petition was not communicated to the Court. As ruled by this Court in
the case of Florendo, Jr. vs. Coloma, supra, involving substantially the same facts and
issue:
. . . The petitioners challenge the proceeding in the Court of
Appeals after the death of the plaintiff-appellant Adela Salindon.
They are of the opinion that since there was no legal representative
substituted for Salindon after her death, the appellate court lost its
 jurisdiction over the case and consequently, the proceedings in the
said court are null and void. This argument is without merit.

There is no dispute that an ejectment case survives the death of a

party. The supervening death of plaintiff-appellant Salindon did
not extinguish her civil personality (Republic v. Bagtas 6 SCRA 242;
Vda. de Haberes v. Court of Appeals, 104 SCRA 534). . . .

xxx xxx xxx

In the case at bar, Salindon's counsel after her death on December

11, 1976 failed to inform the court of Salindon's death. The
appellate court could not be expected to know or take judicial
notice of the death of Salindon without the proper manifestation
from Salindon's counsel. In such a case and considering that the
supervening death of appellant did not extinguish her civil
personality, the appellate court was well within its jurisdiction to
proceed as it did with the case. There is no showing that the
appellate court's proceedings in the case were tainted with
irregularities.

Private respondent's challenge against the proceedings held after Olimpio Bonifacio's
death cannot therefore be heeded.

Neither can private respondent derive comfort from the amendment of Section 36 (1)
of R.A. 3844 by Section 7 of R.A. No. 6389 11 and the promulgation of P.D. No. 27. 12 In
Nilo v. Court of Appeals, G.R. No. L-34586, April 2, 1984,128 SCRA 519, we
categorically ruled that both R.A. No. 6389 and P.D. No. 27 cannot be applied
retroactively under the general rule that statutes have no retroactive effect unless
otherwise provided therein.

There being no cogent reason to nullify the implementation of the writ of execution in
CAR Case No. 2160-B'68, respondent judge acted with grave abuse of discretion in
having done so. The writ prayed for should issue.

WHEREFORE, the petition is GRANTED. The assailed resolution dated July 15, 1986
is hereby SET ASIDE. The immediate execution of the decision in CAR Case No. 2160-
B'68 is ordered. This decision is immediately executory. No pronouncement as to
costs.

SO ORDERED.

Gutierrez, Jr., Bidin and Cortes, JJ., concur.

Feliciano, J., is on leave.

 G.R. No. L-54281 March 19, 1990
CELSO PAGTALUNAN and PAULINA P. PAGTALUNAN, petitioners,
vs.
HON. ROQUE A. TAMAYO, Presiding Judge of the CFI of Bulacan, Branch VI,
REPUBLIC OF THE PHILIPPINES and TURANDOT, TRAVIATA, MARCELITA,
MARLENE PACITA, MATTHEW and ROSARY, all surnamed
ALDABA, respondents.
Emilio G. Garcia for petitioners.
CORTES, J.:
On January 17, 1978, respondent Republic of the Philippines filed a complaint with
the Court of First Instance of Bulacan for expropriation of a parcel of land located in
Bo. Tikay, Malolos, Bulacan, and owned by private respondents herein as evidenced
by TCT No. 24006, issued by the Register of Deeds of the province of Bulacan
[Petition, p. 2; Rollo, p. 10]. The complaint was docketed as Civil Case No. 5257-M and
entitled "Republic of the Philippines v. Turandot Aldaba, et al."
On March 2, 1978, the Court of First Instance issued a writ of possession placing the
Republic in possession of the land, upon its deposit of the amount of Seven Thousand
Two Hundred Pesos (P7,200.00) as provisional value of the land. On June 8, 1978,
petitioners herein filed a supplemental motion for leave to intervene, with complaint
in intervention attached thereto, alleging that petitioner Celso Pagtalunan has been
the bona fide agricultural tenant of a portion of the land. Petitioners asked the trial
court to order payment to Celso Pagtalunan of just compensation for his landholding
or, in the alternative, to order payment of his disturbance compensation as bona
fide tenant in an amount not less than Fifteen Thousand Pesos (P15,000.00) per
hectare.
On December 8, 1978, respondent Judge Roque A. Tamayo issued an order denying
the petitioners' supplemental motion, holding that to admit petitioners' complaint in
intervention would be tantamount to allowing a person to sue the State without its
consent since the claim for disturbance compensation is a claim against the State. On
January 12, 1979, petitioners filed a motion for reconsideration but this was denied by
respondent judge in an order dated February 13, 1979.
On July 23, 1980. the instant petition was filed and was docketed as G.R. No. 54281.
On January 14, 1981, this Court issued a resolution denying the instant petition for
lack of merit. On March 10, 1981, petitioners filed a motion for reconsideration,
limiting the discussion on the issue of lack of jurisdiction of the trial court over the
expropriation case. On August 19, 1981, this Court issued a resolution granting the
motion for reconsideration and gave due course to the petition.
Meanwhile on December 22, 1978, the Office of the Solicitor General filed in behalf of
the Republic of the Philippines a notice of appeal, as well as a first motion for
extension of thirty (30) days from January 12, 1979 within which to file record on
appeal which was granted by respondent court. The Solicitor General was appealing
from that portion of the December 8, 1978 decision of the Court of First Instance
which fixed the compensation for the land expropriated at Thirty Pesos (P30.00) per
square meter. Counsel for private respondents filed an objection to the public
respondent's record on appeal claiming that the same was filed beyond the
reglementary period. On August 13, 1979 the Court of First Instance dismissed the
appeal interposed by the Republic. The Office of the Solicitor General moved for
reconsideration but this was denied for lack of merit. Thereafter, public respondent
filed with the Court of Appeals a petition for certiorari, prohibition
and mandamus with preliminary injunction seeking the annulment of the orders of the
Court of First Instance. On April 29, 1980, the Court of Appeals rendered a decision
dismissing public respondent's petition. On October 24, 1980, public respondent filed
with this Court a petition, docketed as G.R. No. 54886, asking this Court to annul the
decision of the Court of Appeals and to direct and compel the lower court to approve
the Government's record on appeal and to elevate the same to the Court of Appeals.
In a decision dated August 10, 1981, the Court granted the petition and directed the
trial court to approve the Government's record on appeal and to elevate the same to
the Court of Appeals.
I.
The principal issue raised in the petition centers on the alleged right of petitioners to
intervene in the expropriation proceedings instituted by the State against private
respondents as registered owner of the subject property.
Intervention is not a matter of right but may be permitted by the courts when the
applicant shows facts which satisfy the requirements of the law authorizing
intervention [Gibson v. Revilla, G.R. No. L-41432, July 30, 1979, 92 SCRA 219]. Under
Section 2, Rule 12 of the Revised Rules of Court, what qualifies a person to intervene
is his possession of a legal interest in the matter in litigation, or in the success of either
of the parties, or an interest against both, or when he is so situated as to be adversely
affected by a distribution or other disposition of property in the custody of the court
or an officer thereof. The Court has ruled that such interest must be actual, direct and
material, and not simply contingent and expectant [Garcia v. David, 67 Phil. 279
(1939); Batama Farmer's Cooperative Marketing Association, Inc. v. Rosal, G.R. No. L-
30526, November 29, 1971, 42 SCRA 408; Gibson v. Revilla, supra].
In the present case, petitioners claim that Celso Pagtalunan possesses legal interest in
the matter in litigation for he, not private respondents herein, is the party entitled to
just compensation for the subject property sought to be expropriated or, in the
alternative, disturbance compensation as a bona fide tenant based on Section 36 (1) of
Rep. Act No. 3844, as amended by Rep. Act No. 6389.
Petitioners base their claim for just compensation on Certificate of Land Transfer No.
NS-054560 issued to them, where the tenant farmer/grantee is "deemed owner" of the
agricultural land identified therein. * Petitioners contend that the certificate is a
muniment of title evidencing their legal ownership of a portion of the subject
property. Thus, they conclude that they are entitled to a portion of the proceeds from
the expropriation proceedings instituted over the subject property.
There is no merit to the above contention.
The Court is fully aware that the phrase "deemed to be the owner" is used to describe
the grantee of a certificate of land transfer. But the import of such phrase must be
construed within the policy framework of Pres. Decree No. 27, and interpreted with
the other stipulations of the certificate issued pursuant to this decree.
Pres. Decree No. 27 (otherwise known as the "Tenant Emancipation Decree") was
anchored upon the fundamental objective of addressing valid and legitimate
grievances of land ownership giving rise to violent conflict and social tension in the
countryside. More importantly, it recognized the necessity to encourage a more
productive agricultural base of the country's economy. To achieve this end, the decree
laid down a system for the purchase by small farmers, long recognized as the
backbone of the economy, of the lands they were tilling. Landowners of agricultural
lands which were devoted primarily to rice and corn production and exceeded the
minimum retention area were thus compelled to sell, through the intercession of the
government, their lands to qualified farmers at liberal terms and conditions.
However, a careful study of the provisions of Pres. Decree No. 27, and the certificate
of land transfer issued to qualified farmers, will reveal that the transfer of ownership
over these lands is subject to particular terms and conditions the compliance with
which is necessary in order that the grantees can claim the right of absolute
ownership over them.
A certificate of land transfer issued pursuant to Pres. Decree No. 27 provides:
xxx xxx xxx
I, Ferdinand E. Marcos, President of the Philippines, declare
that _________ having manifested his desire to own the land under
his cultivation and having complied with the implementing rules
and regulations of the Department of Agrarian Reform, is hereby
deemed to be the owner of the agricultural land described as
follows:
xxx xxx xxx
subject to the conditions that the cost of the portion herein transferred to
the tenant farmer as fixed by the authorities concerned, including the
interest rate at the rate of six percentum (6%) per annum shall be paid by
the tenant farmer in fifteen (15) equal annual amortization, that the
tenant framer must be a member of a Barrio Association upon
organization of such association in his locality, and that the title to the
land herein shall not be transferred except by hereditary succession or to
the Government in accordance with the provisions of Presidential Decree
Number 27, the Code of Agrarian Reform and other existing laws and
regulations.
xxx xxx xxx
[Annex "B" to the Petition; Rollo, p. 26, Emphasis supplied].
And under Pres. Decree No. 266 which specifies the procedure for the registration of
title to lands acquired under Pres. Decree No. 27, full compliance by the grantee with
the abovementioned undertakings is required for a grant of title under the Tenant
Emancipation Decree and the subsequent issuance of an emancipation patent in favor
of the farmer/grantee [Section 2, Pres. Decree No. 226]. It is the emancipation
patent which constitutes conclusive authority for the issuance of an Original
Certificate of Transfer, or a Transfer Certificate of Title, in the name of the grantee.
Hence, the mere issuance of the certificate of land transfer does not vest in the
farmer/grantee ownership of the land described therein. The certificate simply
evidences the government's recognition of the grantee as the party qualified to avail
of the statutory mechanisms for the acquisition of ownership of the land tilled by him
as provided under Pres. Decree No. 27. Neither is this recognition permanent nor
irrevocable. Failure on the part of the farmer/grantee to comply with his obligation to
pay his lease rentals or amortization payments when they fall due for a period of two
(2) years to the landowner or agricultural lessor is a ground for forfeiture of his
certificate of land transfer [Section 2, Pres. Decree No. 816].
Clearly, it is only after compliance with the above conditions which entitle
a farmer/grantee to an emancipation patent that he acquires the vested right of absolute
ownership in the landholding a right which has become fixed and established, and
is no longer open to doubt or controversy [See definition of vested right" or "vested
interest" in Balbao v. Farrales, 51 Phil. 498 (1928); Republic of the Philippines v. de
Porkan, G.R. No. 66866, June 18, 1987, 151 SCRA 88]. At best, the farmer/grantee,
prior to compliance with these conditions, merely possesses a contingent or expectant
right of ownership over the landholding.
In the present case, the State in the exercise of its sovereign power of eminent domain
has decided to expropriate the subject property for public use as a permanent site for
the Bulacan Area Shop of the Department of Public Works and Highways. On the
other hand, petitioners have not been issued an emancipation patent. Furthermore, they
do not dispute private respondents' allegation that they have not complied with the
conditions enumerated in their certificate of land transfer which would entitle them
to a patent [See Private Respondents' Comment, p. 3; Rollo, p. 34. And
also Memorandum of Private Respondents, p. 6; Rollo, p. 109]. In fact, petitioners do
not even claim that they had remitted to private respondents, through the Land Bank
of the Philippines, even a single amortization payment for the purchase of the subject
property.
Under these circumstances, petitioners cannot now successfully argue that Celso
Pagtalunan is legally entitled to a portion of the proceeds from the expropriation
proceedings corresponding to the value of the landholding.
Anent petitioners' claim for disturbance compensation, the Court finds that the law
cited by petitioners, Section 36 (1) of Rep. Act No. 3844, as amended by Rep. Act No.
6389, cannot be invoked to hold the State liable for disturbance compensation
[See Campos v. CA, G.R. No. 51904, October 1, 1980] where this Court by resolution
denied for lack of merit therein petitioner's claim that, as agricultural lessee or tenant,
he was entitled to disturbance compensation against the State. It refers to situations
where the peaceful enjoyment and possession by the agricultural tenants or lessees of
the land is disturbed or interrupted by the owner/lessor thereof. Paragraphs 1 to 7 of
the said section enumerate the instances when the lessees may be evicted by the
owner/lessor, and paragraph 1 thereof provides that lessees shall be entitled to
disturbance compensation from the owner/lessor, if the land will be converted by the
latter into a residential, commercial or industrial land. Thus, Section 36 (1) of Rep. Act
No. 3844, as amended, deals with the liability of an owner/lessor to his agricultural
tenant/lessee and cannot be invoked to make the State liable to petitioners herein for
disturbance compensation.
II.
On the issue of jurisdiction, petitioners contend that since their motion to intervene
alleges as justification therefor that petitioner Celso Pagtalunan is the bona fide tenant
of the subject property, the case should have been referred to the Court of Agrarian
Relations which has original and exclusive jurisdiction over expropriation
proceedings for public purpose of all kinds of tenanted properties.
The Court finds no reason to dwell on this point. The issue of what court has
jurisdiction over the expropriation proceedings in this case has been rendered moot
and academic by B.P. Blg. 129. Under Paragraph 7, Section 19 of B.P. Blg. 129, all civil
actions and special proceedings which were then under the exclusive jurisdiction of
the Court of Agrarian Relations were placed under the exclusive and original
jurisdiction of the Regional Trial Courts [formerly the Courts of First Instance].
WHEREFORE, the present petition is hereby DENIED for lack of merit.
SO ORDERED.
Fernan, C.J., Gutierrez, Jr., Feliciano and Bidin, JJ., concur.

Nor may petitioners invoke this section as basis to hold private respondents liable for
disturbance compensation. Section 36 (1) of Rep. Act No. 3844, as amended, is
applicable only when it is the owner/lessor who voluntarily opts for the conversion
of his land into non-agricultural land. In the present case, it is the State, not the
private respondents, who disturbed petitioners' possession of the subject property.
The conversion of the property into a permanent site for the Bulacan Area Shop of the
Department of Public Works and Highways was undertaken by the government
independent of the will of private respondents herein.

Parenthetically, it should be noted that the government has already paid petitioner
Celso Pagtalunan approximately FIVE THOUSAND PESOS (P5,000.00) to
compensate the latter for improvements introduced on the property, and expenses for
relocating his home [Petitioners' Reply to the Opposition to their Motion for
Reconsideration, p. 2; Rollo, p. 98. And also Private Respondents' Comment, p. 3; Rollo,
p. 93].

Considering, therefore, that petitioners are not entitled to just compensation for the
expropriation of the subject property, nor to disturbance compensation under Rep.
Act No. 3844, as amended, the Court finds that the trial court committed no reversible
error in denying petitioners' motion for leave to intervene in the expropriation
proceedings below.
 Gonzales vs. LBP [G.R. No. 76759. March 22, 1990.]
Facts: On the strength of a Deed of Assignment executed on 8 August 1981 by Ramos
Plantation Company Inc. through its president, Antonio Vic Zulueta, assigning its
rights under Land Transfer Claim 82-757 unto Ramon A. Gonzales. Gonzales filed an
action before the RTC Manila, Branch 51 (Civil Case 84-24461) to compel Land Bank
of the Philippines to issue Land Bank Bonds for the amount of P400,000.00 in
Gonzales name of instead of in the name of the corporation as the original and
registered owner of the property covered by TCT T-28755 situated in La Suerte,
Malang, North Cotabato with a total area of 251.4300 hectares, which had been
brought under the land transfer program of the government. Corporation was
declared in default for failure to file its answer within the reglementary period while
the LBP filed an answer alleging that the complaint states no cause of action since
there is no privity of contract between Gonzales and itself and that it deals only with
the landowner whose land was subjected to operation land transfer of the
government under PD 27 in order to save time and effort in ascertaining the identities
of additional claimants. On 15 October 1985, the lower court found Gonzales entitled
to the issuance of the Land Bank bonds and thus ordered the LBP to issue to his name
P400,000 P400,000.00 worth of land bank bonds deducted from the P509,000 LBP
bonds payable to the corporation under claim 82-757 with the directive to the
landowner corporation to comply with the 6 requirements listed in paragraph 1 of
the Supplemental Stipulation of Facts dated 10 September 1985 (parties submitted the
first Stipulation of Facts 29 July 1985). LBP filed an appeal before Court of Appeals
resulting in the reversal of the trial courts decision on 2 December 1986 and the
dismissal of the complaint filed therein on the ground that even if there was
compliance with the remaining 6 requirements by the corporation still, the Land Bank
bonds will have to be issued in the name of the said corporation and not to Gonzales.
It is only thereafter that the corporation may indorse the same to Gonzales. Hence,
the petition for review on certiorari. The Supreme Court modified the decision of the
appellate court, by reinstating the directive to Ramos Plantation Company, Inc.
contained in the lower courts decision; and ordered the corporation to comply within
30 days from notice with the 6 requirements listed in paragraph 1 of the
Supplemental Stipulation of Facts dated 10 September 1985, and as soon as the bonds
are released in its name, to immediately endorse the same to Gonzales as assignee
thereof. 1. Jurisdiction: Existence of stipulation of facts does not mean parties agreed
on all facts; Remedy of appeal to the Court of Appeals proper The existence of a
stipulation of facts between the parties does not automatically mean that the parties
agreed on all the facts considering that stipulations may be total or partial. In the
present case instance, it was merely partial. A perusal of the Stipulation and
Supplemental Stipulation of Facts dated 29 July 1985 and 10 September 1985,
respectively, readily reveals that the same do not contain a complete or sufficient
picture of the circumstances among the parties and that certain vital matters are left
out in said stipulations, i.e., the significant policy of the LBP to issue its bonds directly
and only in the name of the landowners; and the fact that there are different stages in
the release of payments under the operation land transfer program with each stage
having different requirements that have to be complied with by the landowner in
order to be entitled to payment under a land transfer claim. In view of these
omissions in the Stipulations, the remedy of appeal before the appellate court
resorted to by the bank is proper because it involved not only pure questions of law
but mixed questions of law and fact. 2. Resolution 75-68 governs issuance of Land
Bank Bonds to assignees; LBP issues bonds in name of assignor-landowner The bank,
in denying the issuance of the bond in the name of the assignee, was guided by
Resolution 75-68 entitled Proper Parties to Receive Land Transfer Payment
promulgated purposely to govern, among others, the issuance of Land Bank Bonds to
assignees by virtue of Deeds of Assignment. Thereunder the LBP can only issue
bonds in the name of the assignor-landowner. It is only after the issuance of bonds in
the landowners name that he shall be required to make the necessary indorsement of
the bonds to his assignee. This is in consonance with the Land Banks policy to deal
primarily with the landowners in order to save time and effort in ascertaining the
identities of claimants.
3. Assignment of Land Transfer Claim subject to the rules and restrictions imposed by
LBP Gonzales relied on the provisions of Article 1311 of the Civil Code, i.e. that by
virtue of said deed, he stepped into the shoes of his assignor and acquired all the
rights of the latter. Gonzales indeed stepped into the shoes of his assignor, but he
overlooked the fact that when the corporation assigned its rights to him under Land
Transfer Claim 82-757, the same was subject to the rules and restrictions imposed by
LBP on the matter of assignment of rights. 4. Rules and regulation on the issuance of
Bonds, based on Section 76 of RA 3844, as amended by PD 251 In the promulgation of
said rules and regulations, the LBP relied on the provisions of Section 76, RA 3844 as
amended by PD 251, which specifically provides that the Board of Directors shall
have the power to prescribe rules and regulations for the issuance, reissuance,
servicing, placement and redemption of the bonds herein authorized to be issued as
well as the registration of such bonds at the request of the holders thereof. 5.
Assignment does not erase liens or restrictions burdening the right assigned The act
of assignment could not operate to erase liens or restrictions burdening the right
assigned. The assignee cannot, after all, acquire a greater right than that pertaining to
the assignor. In the present case, when the corporation assigned its rights, title and
interest in Land Transfer Claim 82-757 for the amount of P400,000.00 in favor of
Gonzales, the latter acquired the same subject to the restrictions on assignment of
rights embodied in Resolution 75-68 dated 25 February 1975 passed by the Board of
respondent LBP. 6. Pertinent provision of Resolution 85-68 In Assignment of Rights
entered into by landowners vesting upon the Assignee the right to receive full or
partial payment from the Land Bank pursuant to land transfer, the same, if found
valid in form and substance, shall be recognized by the Land Bank. Whenever
practicable, Land Bank bonds issued therefor must be made payable to the Assignor-
Landowner who shall be required to make the necessary indorsement of said bonds
to the Assignee. In case the cash portion is the one assigned, the check in payment
thereof shall be issued to the original landowner who shall be required to make the
indorsement to the Assignee. Thus, for record purposes, it will appear that payment
was directly to the landowner concerned and who, by reason of the Assignment, has
caused the necessary indorsement of the bonds and/or check, as the case may be, to
the Assignee. 7. Administrative regulations and policies have force of law and
entitled to great respect; their legality is presumed It is an elementary rule in
administrative law that administrative regulations and policies enacted by
administrative bodies to interpret the law which they are entrusted to enforce have
the force of law and entitled to great respect. They have in their favor a presumption
of legality. 8. Corporation to comply with requirements imposed by LBP The
corporation should comply with all the requirements imposed by LBP to effect the
release of payments under land transfer claims, because of the restriction that the
bonds will only be released in the name of the landowner-assignor corporation which
may thereafter indorse the same to the assignee. 9. Decision of trial court, in fact, is
final and executory In fact, in the decision of the trial court, the corporation was
directed to comply with the 6 requirements listed in paragraph 1 of the Supplemental
Stipulation of Facts dated 10 September 1985. Since no appeal was taken by the
corporation from said decision, said directive has become final and executory.

10. The necessity to modify the decision of the appellate court The decision of the
appellate court, however, dismissing Gonzales complaint had the effect of reversing
said directive, thereby leaving Gonzales without legal authority to compel the
corporation to comply with the requirements of the LBP for the release of the bonds
and thereafter to endorse the same to Gonzales as assignee thereof. The decision of
the appellate court should therefore be modified accordingly.
 VICTOR TALAVERA and VISITACION AGUSTIN TALAVERA, petitioners,
vs.
HON. COURT OF APPEALS and JOSE LAXAMANA, respondents.
Wilfredo I. Untalan counsel for petitioners.
Bureau of Agrarian Legal Assistance for private respondent.
GUTIERREZ, JR., J.:
The Court is asked to examine whether or not the Court of Appeals committed
reversible error in its finding that there was no voluntary surrender of the
landholding in question on the part of respondent Laxamana as tenant.
This petition for review on certiorari assails the decision of the respondent appellate
court which affirmed in totothe judgment rendered by the Regional Trial Court of the
Third Judicial Region, Branch LXVI, Capas, Tarlac on July 21, 1986.
The dispositive portion of the trial court's decision reads:
WHEREFORE, judgment is hereby rendered in favor of the plaintiff
and ordering the defendants:
(1) To reinstate Jose Laxamana as their tenant on
the landholding in question;
(2) To pay him the sum of FIVE THOUSAND
PESOS (P5,000.00) value of 50 cavans of palay at
the rate of P100.00 per cavan as his share for the
agricultural year 1984-85;
(3) To continue paying him the same amount as
damages, every agricultural year thereafter until
his actual reinstatement. (CA Decision, p. 2;
Rollo, p. 16)
The facts pertinent to the case at bar are as follows:
On July 10, 1984, an action for recovery of possession was instituted by the private
respondent against the petitioners over a parcel of agricultural land with an area of
21,081 square meters located at Brgy. Sto. Domingo 11, Sitio Tambo, Capas, Tarlac.
The complaint alleged, among others, that respondent Laxamana had been a bonafide
tenant of the aforesaid parcel of land since 1958 until the petitioners took possession
thereof sometime in 1984; that respondent Laxamana had been in continuous
possession and cultivation of the said landholding since 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; and that due to the petitioners' illegal actions,
respondent 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.
In their answer, the 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; that respondent Laxamana was not actually a tenant of the petitioners 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.
In a decision promulgated on March 3, 1987, the Court of Appeals 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.
Consequently, this petition was filed to seek a reversal of the decision of the appellate
court. According to the petitioners, the Court of Appeals erred:
I
IN HOLDING THAT PRIVATE RESPONDENT DID NOT VOLUNTARILY
SURRENDER THE LANDHOLDING IN QUESTION.
II
IN OVERLOOKING THE PROBATIVE VALUE OF A WRITTEN INSTRUMENT
ENTITLED 'CASUNDUAN' WHICH SHOWS VOLUNTARY SURRENDER. (Rollo, p.
4)
The petitioners bolster their claim that respondent Laxamana is no longer their tenant
over the landholding in question by invoking the rule on parol evidence with respect
to the probative value of the "Casunduan" executed by respondent Laxamana on
March 30, 1973. They further argue that the execution of the "Casunduan" clearly
showed the intention of respondent Laxamana to surrender whatever rights he had
as tenant over the said landholding. Hence, we are presented with the issue of
whether or not by virtue of the "Casunduan" dated March 30, 1973, respondent
Laxamana as tenant is deemed to have surrendered voluntarily the subject
landholding to its owners the petitioners.
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. Section 8 of the said Code
provides:
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 land holding by
the agricultural lessee, written notice of which
shall be served three months in advance; or
(3) Absence of the persons under Section rune to
succeed to the lessee, in the event of death or
permanent incapacity of the lessee.
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.
Standing by itself, the March 30, 1973 Casunduan indicates, as contended by the
petitioners, a voluntary relinquishment of tenancy rights. It states that on his own
initiative, Jose Laxamana went to the Talaveras and requested that he be allowed to
sell his "puesto cung asican" or "the plot I am farming" to the couple. A subscribing
witness, Ermela Lumanlan testified on the voluntary sale of tenancy rights for
P1,000.00, her signing as a witness at the bottom of the contract, and Laxamana's
signing the document.
The argument of the private respondent that under Section 28 of the Agrarian Reform
Code, a voluntary surrender to be valid must be "due to circumstances more
advantageous to him and his family" is double-edged. There appears no question that
Laxamana needed money to pay for the expenses incident to the illness of his wife
which led to her death. The money was to his advantage.
The basic issue in this case is-what did Laxamana give up in return for the P1,000.00?
The case is marked by poor handling at the trial stage and it is not clear whether or
not the P1,000.00 was a result of the usual paternalistic arrangements between
landlords and tenants where the latter meekly approach the landlords in their hours
of need or something else.
In the first place, the agreement was prepared by petitioner Visitacion A. Talavera.
Laxamana could hardly sign his own name. He was clearly at a disadvantage in the
execution of the contract and the wording of the agreement. The intention to give up
the landholding must be gleaned from evidence in addition to the document which
was signed by an ignorant and illiterate peasant in an hour of emotional stress and
financial need.
Second, and most important, Laxamana continued to work on the farm from 1973 up
to 1984 when the petitioners ejected him. As stated by the appellate court, why did it
take the petitioners more than ten years to enforce the Casunduan?
The Talaveras claim that they cultivated the land themselves from 1973 to 1984 when
the complaint was filed. This claim is belied by Exhibits A and B. In Exhibit A,
barangay captain Francisco Manayang reports to the team leader of the Ministry of
Agrarian Reform that, per his own personal knowledge, Jose Laxamana has been
tilling the disputed land since 1958. Exhibit B is an affidavit to the same effect by
Manayang, Mr. Porfirio Manabat who is president of the Agrarian Reform
Beneficiaries Association, and a certain Romeo dela Cruz all of whom are residents of
the barangay where the land is located. Significantly, Laxamana is a resident of Sitio
Tambo, Barangay Sto. Domingo II where the disputed land is situated while the
Talaveras reside in another barangay, Arangureng, of Capas, Tarlac. We see no
reason why the factual findings of the trial court and the appellate court should be
reversed insofar as the continuous cultivation from 1973 to 1984 is concerned.
Third, it is not shown why Laxamana should voluntarily give up his sole source of
livelihood even if he needed money to pay off his debts. Or what he did from 1973 to
1984 if the claim of the Talaveras that they worked the land themselves is correct. We
are more inclined to believe that Laxamana was forced by circumstances to sign
something he did not fully understand and then went right back to the farm and
continued to work on it until 1984.

It is true that Cristobal Gamido, Jr., officer-in-charge of the Agrarian Reform Team
issued on May 8, 1986 a certification that the contested land is not tenanted. However,
the basis for the certification whether or not Mr. Gamido merely read the Casunduan
literally is not shown. It cannot overcome the more convincing evidence of persons
actually residing where the land is located.

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]).

WHEREFORE, IN VIEW OF THE FOREGOING, the petition is hereby DISMISSED.

The decision of the Court of Appeals dated March 3, 1987 is AFFIRMED.
 Bernas vs. Court of Appeals
225 SCRA 119 (1993)
Facts:
Natividad Deita is the owner of a 5,831-sq m property which she entrusted to her
brother, Benigno, so that he could use the fruits thereof to defray the cost of his
children's education in Manila. The property was leased by Bernas pursuant to a
production sharing arrangement executed between Bernas and Benigno. Natividad
played no part in this arrangement. In 1985, the lots were returned by Benigno to
his sister but when the owners sought to take possession, Bernas refused to
relinquish the property. Bernas was claiming that he was an agricultural lessee
entitled to security of tenure. Natividad filed an action for recovery of possession.
The trial court ruled in favor of Bernas but this was subsequently reversed by the
CA.

Issue:
Is consent by a legal possessor, even if without the consent of landowner,
sufficient to create tenancy relationship?

Held:
Yes. As legal possessor of the property, Benigno had the authority and capacity to
enter into an agricultural leasehold relation with Bernas. "The law expressly grants
him, as legal possessor, authority and capacity to institute an agricultural leasehold
lessee on the property he legally possessed." (at 125-126)
Subject is agricultural land
For agricultural tenancy to exist, the subject of the agreement must be an
agricultural land.
RA 6657 defines the term "agricultural land" as "land devoted to agricultural
activity as defined in this Act and not classified as mineral, forest, residential,
commercial or industrial land." (see discussion on scope of CARP, Chapter I).
Under RA 3844, "agricultural land" refers to land devoted to any growth, including
but not limited to crop lands, salt beds, fish ponds, idle land and abandoned land.
The area of agricultural land that a lessee may cultivate has no limit, but he
should cultivate the entire area leased. The three (3) hectare limit under RA
6657 applies only to the award that may be given to the agrarian reform
beneficiary.
Consent by landholder
As discussed earlier, consent must be given by the true and lawful landholder of
the property. In Hilario vs. IAC, 148 SCRA 573 (1987), the Supreme Court held that
tenancy relation does not exist where a usurper cultivates the land.
POLICARPIO NISNISAN AND ERLINDA NISNISAN, petitioners, vs. COURT OF
APPEALS, PACITA MANCERA, WENCESLAO MANCERA and
SILVESTRE POLANCOS, respondents.
DECISION
MARTINEZ, J.:
This petition for review on certiorari filed under Rule 45 of the Revised Rules of
Court assails the decision[1] of the Court of Appeals in CA-G.R. CV No. 39416
affirming en toto the decision[2] of the Regional Trial Court (Branch 21) of Bansalan,
Davao del Sur, in Civil Case No. XXI-5 (86), which dismissed petitioners complaint
for reinstatement of tenancy holding filed against private respondents spouses Pacita
Mancera and Wenceslao Mancera.
The facts as culled from the record are as follows:
Spouses Gavino and Florencia Nisnisan are the owners of a parcel of land
denominated as Lot No. 2510, Cad 275 located at Dolo, Bansalan, Davao del Sur, with
an area of 4.9774 hectares, covered by Original Certificate of Title No. (P-11676)-2151.
Petitioner Policarpio Nisnisan, son of Gavino Nisnisan, has been cultivating one
hectare of the aforesaid land since 1961.
On April 1, 1976, Gavino Nisnisan and petitioner Policarpio Nisnisan entered
into a leasehold tenancy contract[3] which stipulates a sharing arrangement of 1/3:2/3
of the harvest, the bigger share being given to the latter.
On December 28, 1978, Gavino Nisnisan sold two hectares of their land,
including the land tenanted by petitioners-spouses Policarpio and Erlinda Nisnisan,
to private respondents-spouses Wenceslao Mancera and Pacita H. Mancera.
As a result of the sale, petitioners-spouses were ousted from their landholding.
Hence, on November 24, 1982, petitioners-spouses instituted an action[4] for
reinstatement of tenancy holding against private respondent spouses Wenceslao and
Pacita Mancera before the Court of Agrarian Relations (CAR) in Davao City. The
case was later transferred to the Regional Trial Court when the CAR was abolished.
The said complaint was dismissed without prejudice on December 16, 1985.
Sometime in 1983, Gavino Nisnisan demanded from the Mancera spouses to
repurchase the said land but the latter refused. Hence, on November 3, 1986, spouses
Gavino and Florencia Nisnisan, together with the petitioners-spouses Policarpio and
Erlinda Nisnisan, filed a complaint with the Regional Trial Court for: (a) repurchase
of the subject land under the Public Land Act, (b) declaration of nullity of the
instrument of sale and Transfer Certificate of Title No. T-15954, (c) reinstatement of
tenancy holding and (d) damages.[5] The complaintalleged among others,
xxxxxxxxx
FOURTH CAUSE OF ACTION
1. Plaintiffs herein are agricultural tenants-lessees under the Provisions of PD No. 27
on a portion of one (1) hectare of that parcel of land sold by plaintiffs to the
defendants by virtue of the conveyance dated March 31, 1982; said tenanted portion is
devoted and cultivated by tenants plaintiffs to lowland rice culture as shown by an
accomplished OTAC FORM No. 56-B with the land owner prior to the
aforementioned sale;
2. That, despite the verbal agreement between defendants vendee and plaintiffs
tenants for plaintiffs herein to continue and cultivate their tenancy holdings in
pursuant to PD No. 27 availing security of tenancy tenure on any land sold if devoted
to rice and corn culture, defendants ejected the plaintiffs without court order, and
therefore plaintiffs were deprived of their only livelihood;
3. That, in disregard of and to subvert PD No. 27, defendants induced plaintiff
Policarpio Nisnisan to sign a prepared affidavit which he did not know nor
understood the correct import purporting that he has surrendered his tenancy
holdings; that the execution of said affidavit was without the knowledge, consent,
and participation of his tenant spouse, Erlinda Nisnisan;
4. That, despite that plaintiffs and defendants agreed that in case of sale or transfer of
ownership of the tenanted portion the security of tenure of the plaintiffs follows the
land as established under PD. No. 27, but that after the sale, the defendants persisted
in ejecting the plaintiffs from said tenancy holdings; that despite plaintiffs availing of
the provisions of PD No. 1508, no settlement and/or conciliation was reached in the
Office of the Lupon Tagapayapa, as a result in case No. 70 a certification to file action
has been issued;
5. That, plaintiffs have been deprived of their income from said land holdings as
tenant thereof under PD No. 27; defendants therefore are liable for damages:
Traversing the allegation in the complaint with regard to the prayer for
reinstatement of tenancy holding of petitioners Nisnisan spouses, which is the sole
subject matter in this petition, the private respondents Mancera spouses countered
that the Nisnisan spouses have no cause of action, the latter having voluntarily
surrendered their landholding.[6]
On June 25, 1992, the trial court rendered a decision dismissing the complaint
ruling that the petitioners-spouses allegation of tenancy is repudiated by the affidavit
executed by Gavino Nisnisan to the effect that the subject land is not tenanted. The
trial court ratiocinated in this wise:
As to the claim of reinstatement by Policarpio Nisnisan, it appears from the affidavit
(Exhibit X for the Court) of Gavino Nisnisan which was executed and filed with the
Office of the Register of Deeds of Davao del Sur, and recorded as Entry No. 117718,
per memorandum of encumbrances of Original Certificate of Title No. (P-11676)-2151
(Exhibit A/5-C) that the said land is not tenanted. This claim therefore by no less than
plaintiff Gavino Nisnisan, has totally shattered the claim of tenancy of Policarpio
Nisnisan. A fortiori therefore the claim for reinstatement has to fail. [7]
The above-quoted ruling of the trial court was affirmed by the respondent Court
of Appeals in its Decision dated November 20, 1995 which substantially adopted the
trial courts findings, thus:
The Memorandum of Encumbrances of appellant Gavinos OCT No. (P-11676)-2151
(Exhibits A to A-3) contain two entries of affidavit of non-tenancy. The first is Entry
No. 72086 for Affidavit of Non-Tenancy under Justice Circular No. 31. The second
Entry No. 117718 for Affidavit of Non-Tenancy executed by Gavino Nisnisan, vendor.
Also appellants-spouses Gavino and Florencia Nisnisan executed a Joint Affidavit
dated January 28, 1985 wherein they averred the following:
9. That it is not true that our son and his wife were our tenants in the said land as
they did not give any share to us nor did we ask for it and any semblance of tenancy
they did have was only a ploy that did enable them to borrow under the Masagana 99
programs of the government which they did ultimately failed to pay but which we
paid as parents if only to save our son from being prosecuted and jailed for estafa. [8]
Aggrieved by the Court of Appeals decision, petitioners-spouses now come to
this Court on the sole issue of: Whether or not petitioners Spouses Policarpio and
Erlinda Nisnisan voluntarily surrendered their tenancy holding.
We find merit in the petition.
The finding of the Court of Appeals that the petitioners-spouses are not tenants
of the subject land holding is erroneous. While there are annotations in Gavino
Nisnisans certificate of title (Entry No. 72086 for Affidavit of Non-Tenancy under
Justice Circular No. 31 and Entry No. 117718 for Affidavit of Non-Tenancy executed
by Gavino Nisnisan) that the subject land is not tenanted, said annotations are not
conclusive proof of the real relationship between Gavino Nisnisan and petitioner
Policarpio Nisnisan and are not binding upon the court. As we have ruled in Cuao vs.
Court of Appeals,[9]
We believe and so hold that such annotation cannot be regarded as conclusive
upon the courts of justice as to the legal nature and incidents of the relationship
between the landowner(s) in this case and private respondents. Firstly, the
annotation serves basically as notice to all persons of the existence of the Certification
issued by Mr. Eugenio Bernardo,but neither adds to the validity or correctness of that
certification nor converts a defective and invalid instrument into a valid one as
between the parties. Secondly, the certification issued by Mr. Eugenio Bernardo of the
MAR (Ministry of Agrarian Reform) is very much like the certifications issued by the
Secretary of Agrarian Reform and other officials of the Ministry and later the
Department of Agrarian Reform concerning the existence of tenancy relationships in
respect of agricultural lands from which persons, who claim to be tenants, are sought
to be ejected. It is well-settled that the findings of or certifications issued by the
Secretary of Agrarian Reform, or his authorized representative, in a given locality
concerning the presence or absence of a tenancy relationship between the
contending parties are merely preliminary or provisional and not binding upon the
courts. (Underscoring Ours)
Moreover, petitioners-spouses have sufficiently shown that they are the tenants
of the spouses Gavino and Florencia Nisnisan as evidenced by a document entitled
Panagsabutan Sa Abang Sa Yuta (Exhibit D), executed by Gavino Nisnisan and
Policarpio Nisnisan on April 1, 1976, acknowledged before the Municipal Trial Court
Judge Mariano C. Tupas of Bansalan, Davao del Sur, and registered before the
Municipal Treasurers Office, portions of which read:
xxxxxxxxxxxx
2 Nga ang yuta nga giasoy sa itaas pagatamnan sa NAGA-ABANG SA YUTA ug
humay x x x sa panahon sa ting-ulan ug humay x x x sa panahon sa ting-init sulod sa
termino niining kasabutan, ubos sa mga kondisyones nga mao;
xxxxxxxxxxxx
4. Nga ang naasoy nga yuta pagaabangan ug x x x 15 ka bakid nga x x x humay sa tag
50 kilos kada bakid para sa panuig, ug 15 ka bakid nga x x x humay sa tag 50 kilos
kada bakid para sa pangulilang x x x;
5. Nga ang abang para sa tuig tingtanum adto ibayad sa NAGAPAABANG o sa iyang
piniyalan sa sulod sa 3 ka adlaw sukad sa petsa sa ting-ani x x x ihatud sa balay sa
nagpa-abang o kon kagustuhan sa NAGAPAABANG SA YUTA, mahimo iyang
kuha-on ang abang sa petsa sa tinggiok x x x .
6. Nga kon pananglitan, ang maong tanum madaut nga balor ug 75% tungod sa mga
hinungdan nga dili tinuyo (fortuituos event or force majeure) ang NAGA-ABANG
SA YUTA DILI mapugos sa pagbayad sa gikasabutan abang alang nianang tuiga,
apan kinahangalan pagbayaran niya kanang maong abang pinaagi sa data-data sa
sukad sa 50% (kuarta o humay sa kada ting-ani mag sugod sa sunod nga ting tanum
hangtud nga maimpas ang bayranan;
xxxxxxxxxxxx
The above-quoted document evidences the leasehold tenancy relationship
between Gavino Nisnisan and petitioner Policarpio Nisnisan. It clearly shows that the
subject land is agricultural; that petitioner Policarpio Nisnisan is obligated to
cultivate the same by planting rice thereon; and, that there is sharing of the harvests
between the said parties. It is clear that essential elements of tenancy
relationship[10] are present in this case, namely:
1. the parties are the landowner and the tenant
2. the subject matter is agricultural land alienation or transfer of the legal possession of the landholding. He can only be
ejected for cause[14], which, however, is absent in the case at bar.
3. there is consent WHEREFORE, the Decision of the Court of Appeals dated November 20, 1995 is
hereby MODIFIED in that, petitioners-spouses Policarpio and Erlinda Nisnisan are
4. the purpose is agricultural production declared tenants and AFFIRMED in all other respects.

SO ORDERED.
5. there is personal cultivation by the tenants
Regalado (Chairman), Melo, Puno, and Mendoza, JJ., concur
6. there is sharing of harvests between parties

Significantly, this documentary evidence of leasehold tenancy relationship was

never rebutted by the private respondents-spouses. Furthermore, this leasehold
tenancy contract cannot be defeated by the aforementioned affidavit of non-tenancy
executed by Gavino Nisnisan, which is obviously self-serving.

Private respondents likewise impliedly admitted in their answer to the

complaint that petitioners-spouses are tenants when they alleged that petitioners-
spouses have voluntarily surrendered the subject landholding.[11] This brings us to
the issue of whether or not petitioners-spouses have indeed voluntarily surrendered
the subject landholding. Upon perusal of the record of the case, we find private
respondents contention baseless. Other than their bare allegations, private
respondents failed to present any evidence to show that petitioners-spouses
surrendered their landholding voluntarily after the private respondents purchased
the subject property. Moreover, the filing of the complaint for reinstatement of
leasehold tenancy by petitioners-spouses against private respondents before the CAR
militates against the private respondents claim that petitioners-spouses voluntarily
surrendered their landholding to them.

Under Section 8 of Republic Act No. 3844,[12] voluntary surrender, as a mode of

extinguishing agricultural leasehold tenancy relations, must be convincingly and
sufficiently proved by competent evidence. The tenants intention to surrender the
landholding cannot be presumed, much less determined by mere implication.[13]

Based on the foregoing disquisition, it is clear that petitioners-spouses are

agricultural lessees and are therefore entitled to security of tenure as mandated by
Section 10 of Republic Act 3844:

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
landholdings, the purchaser or transferee thereof shall be subrogated to the rights
and substituted to the obligations of the agricultural lessor.(Underscoring Ours)

Thus, the agricultural leasehold relation cannot be extinguished by the mere

expiration of the term or period in an agricultural leasehold contract nor by the sale,
ECILLEVILLE REALTY and SERVICE CORPORATION, petitioner, vs., THE
COURT OF APPEALS and HERMINIGILDO PASCUAL, respondents.
DECISION
FRANCISCO, J.:
In synthesis, these are the antecedent facts:
Petitioner Cecilleville Realty and Service Corporation is the owner of a parcel of
land in Catmon, Sta. Maria, Bulacan, covered by T.C.T. No. 86.494 (M). Private
respondent Herminigildo Pascual occupies a portion thereof. Despite repeated
demands, private respondent refused to vacate and insisted that he is entitled to
occupy the land since he is helping his mother Ana Pascual, petitioners tenant, to
cultivate the land in question. Thenceforth, petitioner instituted an ejectment suit
against private respondent before the Municipal Trial Court of Sta. Maria,
Bulacan. Finding no tenancy relationship between petitioner and private respondent,
the Municipal Trial Court on September 17, 1992, ordered private respondent to
vacate the land and to pay the sum of P10,000.00, as attorneys fees and another sum
of P500.00 monthly from the filing of [the] complaint. [1] Private respondent appealed
to the Regional Trial Court which, on April 4, 1994, set aside the Municipal Trial
Courts decision and remanded the case to the DARAB for further adjudication. Thus:
There is no question that Ana Pascual may seek the assistance of her immediate farm
household in the cultivation of the land. The law protects her in this regard. If the
tenant Ana Pascual will be deprived of such right by ejecting her son Herminigildo
Pascual from the land, it is tantamount to circumventing the law as Ana Pascual will
be deprived of the helping hands of her son. What could not be done directly cannot
be done indirectly. The issue of tenancy relationship between the plaintiff corporation
and Ana Pascual cannot be avoided in this ejectment case.
WHEREFORE, in the light of the foregoing, this Court hereby orders that the instant
case be REMANDED to the DARAB for further adjudication and the decision of the
Court a quo is hereby SET ASIDE x x x. [2]
Petitioner moved for reconsideration but to no avail; hence, it appealed to
respondent Court of Appeals. In its assailed decision [3], respondent
court [4] dismissed petitioners appeal. The entire ruling of respondent court in point
states:
We find this petition devoid of merit.
There is a clear tenancy relationship between the plaintiff and the defendant, such
that the defendant cannot be ejected from the premises like a common squatter.
The tenancy relationship dated back to 1976 when the defendants father, Sotero
Pascual, became the tenant of Jose A. Resurreccion, the President of
the Cecilleville Realty and Service Corporation. This tenancy continued until 1991
when Sotero Pascual died and was succeeded by his wife Ann Pascual by operation
of law. That Ana Pascual is entitled to the security of tenure was upheld by the
DARAB in its Decision of November 8, 1993 which ordered the plaintiff to respect
and maintain the peaceful possession and cultivation of the property by the
defendant Ana Pascual and ordered the execution of a agricultural leasehold contract
between the parties.
The defendant Herminigildo Pascual is occupying and working on the landholding to
help his mother, a bona-fide tenant. He is an immediate member of the family and is
entitled to work on the land. As the lower court held:
Under Republic Act No. 1199, as amended by RA 2263, entitled An Act to Govern the
Relations Between Landholders and Tenants of Agricultural Lands (Leasehold and
Share Tenancy), Section 5(a) defines the term tenant, to wit:
Sec. 5.
(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 latters 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.
Similarly, the term immediate farm household is defined in the same section as
follows:
(o) Immediate farm household includes the members of the family of the tenant, and
such other persons, whether related to the tenant or not, who are dependent upon
him for support and who usually help him operate the farm enterprise.
The defendant, although not the tenant himself, is afforded the protection provided
by law as his mother is already old and infirm and is allowed to avail of the labor of
her immediate household. He is entitled to the security of tenure accorded his
mother. His having a house of his own on the property is merely incidental to the
tenancy.
WHEREFORE, the Decision appealed from is AFFIRMED with costs against the
petitioner. [5] (Underscoring supplied.)
Dissatisfied, petitioner filed the instant petition for review on certiorari
anchored on a lone assignment of error, to wit:
Petitioner respectfully contends that the Honorable Court of Appeals erred in not
finding that while the private respondent is entitled to work on the agricultural land
of petitioner in his capacity as member of the family of tenant Ana Pascual,
nonetheless he can not occupy a substantial portion thereof and utilize the same for
residential purposes. [6]
On August 19, 1996, the Court gave due course to the petition and required the
parties to submit their respective memoranda. Thereafter, the Court deliberated on
the arguments set out in their pleadings.
The petition is impressed with merit.
At the outset, the Court notes that petitioner does not dispute respondent courts
finding that Ana Pascual, private respondents mother, is its bona-fide tenant. Neither
does petitioner question the right of Ana Pascual, the tenant, to be assisted by a
member of her household, who in this case is respondent Herminigildo
Pascual. [7] What petitioner impugns as erroneous is respondent courts gratuitous
pronouncement which effectively granted private respondent not only a home lot,
but also the right to maintain his own house in petitioners small parcel of
land [8] despite the fact that Ana Pascual, the adjudged bona-fide tenant, has
previously been given a home lot and has an existing house thereon. Private
respondent Herminigildo Pascual, for his part, insists that he is entitled by
law, (Section 22, (3) of Rep. Act No.1199, as amended by Rep. Act No. 2263), [9] to a
home lot and the right to maintain another house different from that of his
mother. To bolster his contention, private respondent adopts respondent courts
ruling finding him as a member of Ana Pascuals immediate farm household. Private
respondent holds, quoting extensively from the assailed decision, that although not
the tenant himself, [he] is afforded the protection provided by law as his mother is
already old and infirm and is allowed to avail of the labor of her immediate
household. x x x. [And] [h]is having a house of his own on the property is merely
incidental to the tenancy. [10]
As the Court sees it, the issue lies on the interpretation of Section 22, paragraph
3, of Rep. Act No. 1199, as amended by Rep. Act No. 2263. This section provides in
full as follows:
SEC. 22
xxxxxxxxx
(3) The tenant shall have the right to demand for a home lot suitable for dwelling
with an area of not more than 3 per cent of the area of his landholding provided that
it does not exceed one thousand square meters and that it shall be located at a
convenient and suitable place within the land of the landholder to be designated by
the latter where the tenant shall construct his dwelling and may raise vegetables,
poultry, pigs and other animals and engage in minor industries, the products of
which shall accrue to the tenant exclusively. The tenants dwelling shall not be
removed from the lot already assigned to him by the landholder, except as provided
in section twenty-six unless there is a severance of the tenancy relationship between
them as provided under section nine, or unless the tenant is ejected for cause, and
only after the expiration of forty-five days following such severance of relationship or
dismissal for cause. (Emphasis supplied)
The law is unambiguous and clear. Consequently, it must be applied according
to its plain and obvious meaning, according to its express terms. Verba legis non est
recedendum, or from the words of a statute there should be no departure. [11] As clearly
provided, only a tenant is granted the right to have a home lot and the right to
construct or maintain a house thereon.And here, private respondent does not dispute
that he is not petitioners tenant. In fact, he admits that he is a mere member of Ana
Pascuals immediate farm household. Under the law, therefore, we find private
respondent not entitled to a home lot. Neither is he entitled to construct a house of his
own or to continue maintaining the same within the very small landholding of
petitioner. To rule otherwise is to make a mockery of the purpose of the tenancy
relations between a bona-fide tenant and the landholder as envisioned by the very
law, i.e., Rep. Act No. 1199, as amended, upon which private respondent relies, to
wit:
Sec. 2. Purpose. It is the purpose of this Act to establish agricultural tenancy relations
between landholders and tenants upon the principle of social justice; to afford
adequate protection to the rights of both tenants and landholders; to insure the
equitable division of the produce and income derived from the land; to provide
tenant-farmers with incentives to greater and more efficient agricultural production;
to bolster their economic position and to encourage their participation in the
development of peaceful, vigorous and democratic rural communities. (Emphasis
supplied)
Thus, if the Court were to follow private respondents argument and allow all
the members of the tenants immediate farm household to construct and maintain
their houses and to be entitled to not more than one thousand (1,000) square meters
each of home lot, as what private respondent wanted this Court to dole-out, then
farms will be virtually converted into rows, if not colonies, of houses. How then can
there be equitable division of the produce and income derived from the land and more
efficient agricultural production if the lands productivity and use for growing crops
is lessened or, more appropriately, obliterated by its unceremonious conversion into
residential use? It is a fundamental principle that once the policy or purpose of the
law has been ascertained, effect should be given to it by the judiciary. [12] This Court
should not deviate therefrom.
Further, it is undisputed that Ana Pascual, the tenant and private respondents
mother, has an existing home lot and a house on the subject property in which private
respondent may take refuge while attending to his work. Curiously, despite its
availability private respondent chose to construct, without petitioners permission, a
concrete house of his own thereby saving him the trouble of paying appropriate
rents. If the Court were to abide by the respondent courts inordinate pronouncement
that private respondent is entitled to maintain his own house then we will be
condoning the deprivation of a landholders property without even a fraction of
compensation. It taxes the credulity of the Court, therefore, to insist that private
respondents having a house of his own on the property is merely incidental to the
tenancy and to afford him the convenience of attending to the cultivation of the land
for, in the first place, he is not the tenant as he himself admits. Besides, the incidental
use of his own house can very well be provided by the existing house of his mother,
who with her old and infirm condition, surely needs the attention and care of her
children, one of whom is herein private respondent. Be it emphasized that like the
tenant the landholder is also entitled to the protection of the law as one of the
purposes of the Act is to afford adequate protection to the rights of BOTH tenants
and landholders. [13] The policy of social justice, we reiterate, is not intended to
countenance wrongdoing simply because it is committed by the
underprivileged. Compassion for the poor, as we said in Galay, et. al. v. Court of
Appeals, et. al. [14] is an imperative of every humane society but only when the
recipient is not a rascal claiming an undeserved privilege.

WHEREFORE, the petition is GRANTED. The part of the decision appealed

from which is inconsistent herewith is REVERSED and SET ASIDE. The decision of
the Municipal Trial Court directing the private respondent Herminigildo Pascual to
vacate the portion of the landholding he occupies and to pay the petitioner attorneys
fees in the amount of P10,000.00 and another sum of P500.00 monthly from the filing
of complaint is hereby REINSTATED.

Costs against private respondent.

SO ORDERED.

Narvasa, C.J., (Chairman), Davide, Jr., Melo, and Panganiban, JJ., concur.
ANICETO[1] M. QUIO, petitioner, vs COURT OF APPEALS, PURIFICACION L.
CANSON, EDITHA G. LEONARDO, CARMELITA L. MORI, JOSEFINA
L. BAIS, AIDA L. COLLYER, ANTONIO G. LEONARDO, RUDOLFO G.
LEONARDO, ROBERTO G. LEONARDO and TERESA L. REGNER, in
substitution for ANTONIO LEONARDO SR., JOSEFA GALAN and
JOSE BITOON, respondents
DECISION
BELLOSILLO, J.:
On 29 October 1974 Bernarda and Rosario Galan sold their agricultural land
with an area of 2.3926 hectares situated in Basak, Compostela, Cebu, to spouses
Antonio Leonardo Sr. and Josefa Galan for P2,000.00. More than a decade later, or on
30 October 1986, petitioner Aniceto Quio filed aa complaint for redemption of the
property against the vendees claiming that he had been instituted as tenant thereon
by the Galans since 1951; consequently, he had the right to be notified in writing of
the owners' intention to sell the property to enable him to exercise his right of
preemption under Sec. 11 of RA No. 3844[2] but that notwithstanding the Galans had
not informed him of the sale. He claimed that he learned of the transaction only on 1
September 1986 when he found out that the Leonardos were already the
new owners. He therefore prayed that he be allowed to redeem the property and
consigned the purchase price with the trial court on the same day he filed his
complaint.
Meanwhile, on 4 November 1986 the Leonardos sold the property to private
respondent Jose Bitoon for P30,000.00.
On 12 November 1986 petitioner filed another complaint against the same
spouses for injunction with a prayer for a restraining order to enjoin his ejectment
from the property.
During the pendency of the case, Antonio Leonardo Sr. died. His children,
private respondents Purificacion L. Canson, Editha G. Leonardo, Carmelita L. Mori,
Josefina L. Bais, Aida L. Collyer, Antonio G. Leonardo, Rudolfo G. Leonardo, Roberto
G. Leonardo and Teresa L. Regner, were substituted in his stead as co-defendants.
Sometime thereafter, petitioner received a letter from the counsel of respondent
Bitoon dated 24 November 1986 notifying him of the transfer of ownership of the
land to his client. As no supporting document was attached to the letter to bolster
counsel's
claim, petitioner went to the Notarial Division of the Capitol Building and
obtained on 2 March 1987 a copy of the pertinent deed of sale between spouses
Leonardo and respondent Bitoon.
On 27 July 1987 petitioner filed an amended complaint impleading Jose Bitoon
as additional defendant. However, on 8 October 1990 the trial court dismissed the
original as well as the amended complaint after finding that majority of the essential
requisites of tenancy relationship between the parties did not exist. [3]
The Court of Appeals however arrived at an entirely different evaluation of the
evidence.[4] On 5 August 1994 it held that all the essential requisites for tenancy
relationship were present, and being a tenant petitioner was entitled to the rights of
preemption and redemption under Secs. 11 and 12, respectively, of RA No.
3844. Nevertheless it noted a stumbling block to petitioner's complete victory thus -
Be that as it may, since the land in question had already pass(ed) on to
defendant-appellee Jose Bitoon, and plaintiff-appellant's quests against defendant-
appellees spouses Antonio Leonardo and Josefa Galan may be considered moot and
academic under RA 3844, Section 10, defendant-appellee Jose Bitoon having been
subrogated to the rights and obligations of his predecessors-in-interest, his obligation
under the law to the tenant-plaintiff continues and subsists, that if he decides to sell
the land, then plaintiff-appellant can still exercise his rights under the law (Velasquez
v. Nery, 211 SCRA 28, underscoring supplied).[5]
The appellate court decreed thus -
1. declaring petitioner as tenant of Bernarda and Rosario Galan
and thereafter of their successor-in-interest, Antonio Leonardo Sr.
substituted by his (nine?) children and in turn of the present owner, respondent
Bitoon;
2. ordering respondent Bitoon to reinstate petitioner as agricultural tenant and to
maintain him in the peaceful possession and enjoyment of the land tenanted by him;
3. ordering the Clerk of Court of the trial court to return to petitioner the amount of
two thousand pesos (P2,000.00) which he consigned with the trial court as
redemption price for the land in question, covered by O.R. No. 9802404 J dated 30
October 1986; and,
4. no pronouncement as to costs.[6]
On 23 November 1994 respondent Court of Appeals denied reconsideration.[7]
The issue then is whether respondent Court of Appeals was correct in holding
that petitioner could not redeem the property from respondent Bitoon unless the
latter decided to sell it on the strength of the ruling in Velasquez v. Nery.[8]
Petitioner asserts that Velasquez is inapplicable because of the difference in
factual circumstances. In that case, the sale made by the landowners to a third party
was by virtue of a court order and not as envisioned under Sec. 11 of RA No. 3844. In
other words, the right of the tenants therein to preemptively purchase was not
violated. Hence the right of redemption was unavailing to them.
For a better understanding of the controversy, it is essential to discuss first the
statutory right of redemption and pertinent jurisprudence on the matter.
 Section 12 of RA No. 3844 as amended by RA No. 6389 provides -
Sec. 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 x x x x The right of
redemption under this Section may be exercised within one hundred eighty days
from notice in writing which shall be served by the vendee on all lessees affected and
the Department of Agrarian Reform upon the registration of the sale x x x x The
redemption price shall be the reasonable price of the land at the time of the sale x x x
x
Simply stated, in the event that the landholding is sold to a third person without
the knowledge of the agricultural lessee, the latter is granted by law the right to
redeem it within one hundred eighty (180) days from notice in writing and at a
reasonable price and consideration. Petitioner was not notified of the first and second
instances of sale of the property apparently because all the respondents disputed
petitioner's assertion that he has been a tenant thereon since 1951. These instances of
sale without notification gave rise to his right to redeem the property as lessee
although no longer from the Leonardos but from its present owner, respondent
Bitoon.
A letter dated 24 November 1986 from the counsel of respondent Bitoon was
received by petitioner informing him that the ownership of subject property has been
transferred to respondent Bitoon. However the counsel did not bother to furnish
petitioner with the supporting documents which is why petitioner did not readily
believe what was written in the letter.Petitioner had to proceed to the Notarial
Division of the Capitol Building on 2 March 1987 to secure a copy of the deed of sale
between spouses Leonardo and respondent Bitoon.
The purpose of the written notice required by law is to remove all uncertainties
as to the sale, its terms and its validity, and to quiet any doubts that the alienation is
not definitive. The law does not prescribe any particular form of notice, nor any
distinctive method for notifying the redemptioner. So long as the redemptioner is
informed in writing of the sale and the particulars thereof, the period for redemption
will start running.[9] The letter received by petitioner, being bare, was not such
written notice. It failed to make certain the terms, particulars and validity of the
sale. Rather, only a copy of the deed of sale, in an authentic form, will satisfy the
requirement of the law and serve the purpose thereof. Thus, it is proper to reckon the
period of redemption from receipt of the authentic document on 2 March 1987. The
amended complaint filed on 27 July 1987 is well within the redemption period of one
hundred eighty (180) days.
The preceding discussion leads us to the requirement concerning reasonable
price and consideration. An offer to redeem to be properly effected can either be
through a formal tender with consignation or by filing a complaint in court coupled
with consignation of the redemption price within the prescribed period. [10] It must be
stressed however that in making a repurchase it is not sufficient that a person offering
to redeem merely manifests his desire to repurchase; this statement of intention must
be accompanied by an actual and simultaneous tender of payment which constitutes
the legal use or exercise of the right to repurchase. And the tender of payment must
be for the full amount of the repurchased price, otherwise the offer to redeem will be
held ineffectual.[11] As to what constitutes reasonable price and consideration, the
valuation placed by the Leonardo spouses and respondent Bitoon themselves as price
of the land must be taken to be such reasonable price and consideration. [12]
Petitioner consigned the amount of P2000.00 paid by the Leonardos to the
Galans. However when he amended his complaint by imp[leading respondent
Bitoon, he did not increase the amount consigned as would have made it equivalent
to P30,000.00, representing payment by the second vendee. In this regard, petitioner
submits that he is not required to consign the latter amount since that would put an
additional burden on a tenant seeking redemption. After all, he would be paying
whatever amount would be finally determined by the trial court as reasonable price
and consideration.
It is not difficult to discern why the full amount of the redemption price should
be consigned in court. Only by such means can the buyer become certain that the
offer to redeem is one made seriously and in good faith. A buyer cannot be expected
to entertain an offer of redemption without the attendant evidence that the
redemptioner can, and is willing to accomplish the repurchase immediately. A
different rule would leave the buyer open to harassment by speculators or crackpots,
as well as to unnecessary prolongation of the redemption period, contrary to
the policy of the law in fixing a definite term to avoid prolonged and anti-economic
uncertainty as to ownership of the thing sold. Consignation of the entire price would
remove all controversies as to the redemptioner's ability to pay at the proper
time.[13] Against such rationale, petitioner's submission is rendered insignificant. The
amount so consigned by him falls short of the requirement of the law and leaves the
Court with no choice but to rule against him.
With the foregoing ratiocination, it becomes unnecessary to dwell on the issue
of whether petitioner may redeem the property from respondent
Bitoon. Nevertheless, we shall pursue the discussion thereon if only to rectify some
points. In Velasquez, the Velasquez spouses, in a nutshell, were agricultural lessees of
the property owned by the Nery spouses and the Lorenzos.Later, the owners filed an
action for partition before the trial court. In a compromise agreement, they agreed to
sell the property to Delta Motor Corporation. Having received information about the
impending sale, the Velasquez spouses filed an action for redemption before the then
Court of Agrarian Relations. Subsequently, the sale materialized. Unfortunately, the
redemption case was dismissed due to lack of interest to redeem the property at its
acquisition price. The appeal before respondent court and the petition before this
Court met the same fate. However, we also noted that the Philippine National Bank
(PNB), which was not a party to the case, had in the meantime extrajudicially
foreclosed the property. By way of obiter dictumwe stated-
Because of the extra-judicial foreclosure of the mortgage over the subject property by
the Philippine National Bank, the present case
has become moot and academic with regard to petitioners' claim
against Delta Motor Corporation. It is now the PNB or its subsequent transferees
from whom the petitioners must redeem, if and when PNB decides to sell or alienate
the subject property in the future x x x x

Respondent appellate court must have taken out of context our statement
therein when the former ruled that "if respondent Bitoon decides to sell the land then
petitioner can still exercise his rights under the law." The phrase in the Velasquez case
that "if and when PNB decides to sell or alienate the subject property in the
future" logically refers to "its subsequent transferees" only, and not as a condition
precedent to the exercise of the right of redemption as what respondent court
perceived it to be. To further stress the matter, the ruling of respondent court
overlooks the essence of redemption provided in the amended Sec. 12 of RA No. 3844
which, as previously mentioned, grants to the lessee such right in case the property is
sold to a third person without his knowledge. Since that situation obtained
in Velasquez, the Velasquez spouses had the right to redeem the property from the
PNB as new owner. The circumstance that the property was sold to a third person
without the knowledge of the lessee provides the source from which the right of
redemption springs. Analyzing this right, it may be stated that such right works only
one way - in favor of the redemptioner. For he can compel the purchaser to sell but he
cannot be compelled to buy. Supposing the lessee failed to redeem the property and
the purchaser decided to sell or alienate it without notifying the former, the property
may be redeemed from the subsequent transferee because another essence of the right
of redemption is that it attaches
to a particular landholding by operation of law.[14] The plain import of the obiter
dictum in the Velasquez case is that the Velasquez
spouses may redeem the property from the PNB as new owner, or

should PNB decide to sell the property they may redeem the same from its
transferee. Thus, contrary to the assertion of petitioner, Velasquez is applicable but not
as so applied by respondent court; instead, it should have based its main ruling on
the lack of interest to redeem the property at the acquisition price paid by respondent
Bitoon.

Hence we reiterate that, for failure of petitioner to consign the entire redemption
price, there was no valid exercise by him of his legal right to redeem.

WHEREFORE, the petition is DENIED. The decision of respondent Court of

Appeals (1) declaring petitioner as tenant of Bernarda and Rosario Galan and
thereafter of their successor-in-interest, Antonio Leonardo Sr. and Josefa Galan, and
in turn, of the present owner respondent Bitoon; (2) ordering respondent Jose Bitoon
to reinstate petitioner as agricultural tenant and to maintain him in the peaceful
possession and enjoyment of the land tenanted by him; (3) ordering the Clerk of
Court of the trial court to return to petitioner the amount of P2,000.00 which he
consigned as redemption price for the land in question covered by O.R. No. 9802404
J dated 30 October 1986, with no pronouncement as to costs, is AFFIRMED.

SO ORDERED.

Davide Jr., Vitug, Panganiban and Quisumbing, JJ. concur.