FIRSTDIVISION

HEIRSOFENRIQUETAN,SR.,G.R.No.145568
namely,NORMATAN,
JEANETTETAN,Present:
JULIETATAN,Davide,Jr.,C.J.,
ROMMELTAN,andChairman,
ENRIQUETAN,JR.,Quisumbing,
AllrepresentedbyYnaresSantiago,
ROMMELTAN,Carpio,and
Petitioners,Azcuna,JJ.

versus
Promulgated:
REYNALDAPOLLESCAS,
Respondent.November17,2005

xx

DECISION


CARPIO,J.:

TheCase


[1] [2]
Before the Court is a petition for review of the Decision of the Court of Appeals
promulgatedon31August2000inCAG.R.SPNo.48823.TheCourtofAppealsaffirmedthe
decision of the Department of Agrarian Reform Adjudication Board ordering petitioners to
respectrespondentspossessionandcultivationoftheland.


TheAntecedents

[3]
Petitioners Norma Tan, Jeanette Tan, Julieta Tan, Rommel Tan and Enrique Tan, Jr.
(TanHeirs)arecoownersofacoconutfarmland(Land)locatedatLabo,OzamisCitywithan
[4]
areaof25,780squaremeters.

EstebanPollescas(Esteban)wastheoriginaltenantoftheLand.UponEstebansdeathin
1991, his son Enrique Pollescas (Enrique) succeeded him and was appointed as tenant by the
[5]
landownerEnriqueTan(Tan).

However,respondentReynaldaPollescas(Reynalda),Estebanssurvivingsecondspouse,
demanded that Tan recognize her as Estebans successor. Tan did not accede. Thus, Reynalda
filed with the Department of Agrarian Reform Adjudication Board of Ozamis City (DARAB
Ozamis) a complaint for Annulment of Compromise Agreement, Quieting of Tenancy
[6]
Relationshipanddamages.

InitsDecisiondated28April1993,theDARABOzamisdeclaredReynaldaasthelawful
tenant of the Land. The DARABOzamis apportioned the harvests between the Tan Heirs and
Reynaldabasedonthecustomarysharingsystemwhichis2/3tothelandownerand1/3tothe
[7]
tenant.

On the following harvest dates, 11 and 19 of June, 9 September, 6 and 13 of December
1993, Reynalda failed to deliver to the Tan Heirs 2/3 of the harvests amounting to P3,656.70.
[8]
The Tan Heirs demanded Reynalda to pay such amount. However, Reynalda ignored the
demand.

 Consequently, the Tan Heirs filed a complaint for estafa against Reynalda with the
[9]
MunicipalTrialCourtinCities,OzamisCity,Branch2. ThetrialcourtfoundReynaldaguilty
[10]
of estafa and sentenced her to five months of arresto mayor maximum to two years of
prision correccional minimum and ordered her to pay the Tan Heirs P3,656.70, the amount
[11]
whichshemisappropriated.

Subsequently, for Reynaldas continued failure to deliver their share, the Tan Heirs filed
[12]
withtheDARAB,MisamisOccidental(DARABMisamisOccidental)anejectmentcase.

[13]
On 18 September 1996, the DARABMisamis Occidental ruled in favor of the Tan
Heirs.TheDARABMisamisOccidentaldisposedofthecaseinthiswise:

WHEREFORE,premisesconsidered,decisionisherebyrenderedterminatingthetenancy
relationshipofhereinparties.

Consequently,respondentReynaldaPollescasisorderedtovacatethesubjectlandholding
andturnoveritspossessionandcultivationtotheplaintiffs.

The MARO of Ozamis City is likewise ordered to investigate and verify in the subject
landholdingifthereareactualfarmercultivatorsintheareawhomayqualifyaslesseesthereof,
whothenshouldbeplacedunderleaseholdpursuanttothemandateofSection12,R.A.6657.

[14]
SOORDERED.



Aggrieved by the decision, Reynalda appealed to the DARAB, Diliman, Quezon City
(DARAB).TheDARABreversedthedecisionoftheDARABMisamisOccidental,towit:

WHEREFORE, premises considered, the appealed decision dated 18 September 1996 is

hereby REVERSED and SET ASIDE and a new one is rendered ordering the landowners to
respectthepeacefulpossessionandcultivationofthesubjectlandholding.

RespondentAppellantisherebyorderedtopayherunpaidleaseholdrentals.

[15]
SOORDERED.



TheTanHeirsappealedthedecisionoftheDARABtotheCourtofAppeals.TheCourtof
Appeals affirmed the decision of the DARAB ordering the Tan Heirs to respect Reynaldas
possessionandcultivationoftheLand.

Hence,thispetition.

TheRulingoftheCourtofAppeals


In affirming the decision of the DARAB, the Court of Appeals cited Roxas y Cia v.
[16]
Cabatuando, et al. where this Court held that x x x mere failure of a tenant to pay the
landholderssharedoesnotnecessarilygivethelattertherighttoejecttheformerwhenthereis
lackofdeliberateintentonthepartofthetenanttopayxxx.

The Court of Appeals held that Reynaldas failure to deliver the full amount of the Tan Heirs
sharecouldnotbeconsideredasawillfulanddeliberateintenttodeprivetheTanHeirsoftheir
share.TheCourtofAppealsheldthatReynaldahonestlybelievedthatshewasentitledtoashare
of the harvests in 19921993 while the case for Annulment of Compromise Agreement was
pendingbeforetheDARABOzamis.Reynaldaalsobelievedthatshecouldeffectasetofffor
her19921993sharefromthe1994shareoftheTanHeirs.

TheCourtofAppealsfurtherdeclaredthattherentalmustbelegaltoconsidernonpaymentof
suchasagroundforejectment.Theappellatecourtstatedthat:

x x x for a tenants failure to pay rental to come within the intendment of the law as a
groundforejectment,itisimperativethattherentalmustbelegal.Whatthelawcontemplatesis
thedeliberatefailureofthetenanttopaythelegalrental,notthefailuretopayanillegalrental.A
stipulation in a leasehold contract requiring a lessee to pay an amount in excess of the amount
allowedbylawisconsideredcontrarytolaw,moralsorpublicpolicy.Suchcontractisnulland
voidastotheexcess.

It is noteworthy that Section 34 of RA 3844 provides that the consideration for the lease of
ricelandandlandsdevotedtoothercropsshallnotbemorethantheequivalentoftwentyfiveper
centum of the average normal harvest. The tenant is obliged to pay a maximum of 25% of the
normal harvest and not two thirds as in the case at bar. Thus, even admitting that a setoff was
effectedinfavorofrespondentforher19921993share,yetenoughislefttocoverthe25%share
[17]
ofthepetitionersforthe1994crop.



CitingSection8ofRepublicActNo.3844(RA3844),theCourtofAppealsalsoheld[t]hereis
nothinginthelawthatmakesfailuretodelivershareagroundforextinguishmentofleasehold
[18]
agreement. ReynaldasfailuretodeliverfullytheshareoftheTanHeirsisnotsufficientto
[19]
disturbtheagriculturalleaseholdrelation.


TheIssues

IntheirMemorandum,theTanHeirsraisethefollowingissues:

I
WHETHER THERE IS NO EXCEPTION TO THE GROUNDS FOR
EXTINGUISHMENT OF LEASEHOLD RELATION UNDER SECTION 8 OF
RA3844.

II
WHETHER THE COURT OF APPEALS CORRECTLY RULED THAT
REYNALDA IS OBLIGED TO PAY ONLY 1/4 OR 25% OF THE NORMAL
HARVEST AND NOT 2/3 WHEN THE SUBJECT LAND WAS NOT YET
PLACED UNDER THE LEASEHOLD SYSTEM PURSUANT TO SECTION 12
[20]
OFRA6657.




TheRulingoftheCourt


 Thepetitionlacksmerit.

Attheoutset,theCourtdeclaresthatRA6657isthegoverningstatuteinthiscase.

[21]
On 8 August 1963, RA 3844 or the Agricultural Land Reform Code abolished and
[22]
outlawed share tenancy and put in its stead the agricultural leasehold system. On 10
September1971,RepublicActNo.6389(RA6389)amendingRA3844(RA3844asamended)
[23]
declaredsharetenancyrelationshipsascontrarytopublicpolicy. RA6389didnotentirely
[24]
repealRepublicActNo.1199 andRA3844evenifRA6389substantiallymodifiedthem.
[25]
Subsequently,RepublicActNo.6657ortheComprehensiveAgrarianReformLawof1988
(RA 6657) took effect on 15 June 1988. RA 6657 only expressly repealed Section 35 of RA
[26]
3844asamended. Thus,RA6657istheprevailinglawinthiscase.Theharvestsindispute
arefortheyears19921993oraftertheeffectivityofRA6657.


Nogroundfordispossessionoflandholding


Section7ofRA3844asamendedprovidesthatoncethereisaleaseholdrelationship,as
in the present case, the landowner cannot eject the agricultural tenant from the land unless
[27]
authorized by the court for causes provided by law. RA 3844 as amended expressly
[28]
recognizesandprotectsanagriculturalleaseholdtenantsrighttosecurityoftenure.

Section 36 of RA 3844 as amended enumerates the grounds for dispossession of the
tenantslandholding,towit:

SEC.36.PossessionofLandholdingExceptions.Notwithstandinganyagreementastothe
periodorfuturesurrenderoftheland,anagriculturallesseeshallcontinueintheenjoymentand
 possessionofhislandholdingexceptwhenhisdispossessionhasbeenauthorizedbytheCourtina
judgmentthatisfinalandexecutoryifafterduehearingitisshownthat:

(1)Thelandholdingisdeclaredbythedepartmentheaduponrecommendationofthe
NationalPlanningCommissiontobesuitedforresidential,commercial,industrialorsomeother
urbanpurposes:Provided,Thattheagriculturallesseeshallbeentitledtodisturbance
compensationequivalenttofivetimestheaverageofthegrossharvestsonhislandholdingduring
thelastfiveprecedingcalendaryears

(2)Theagriculturallesseefailedtosubstantiallycomplywithanyofthetermsand
conditionsofthecontractoranyoftheprovisionsofthisCodeunlesshisfailureiscausedby
fortuitouseventorforcemajeure

(3)Theagriculturallesseeplantedcropsorusedthelandholdingforapurposeotherthan
whathadbeenpreviouslyagreedupon

(4)Theagriculturallesseefailedtoadoptprovenfarmpracticesasdeterminedunder
paragraph3ofSectiontwentynine

(5)Thelandorothersubstantialpermanentimprovementthereonissubstantiallydamaged
ordestroyedorhasunreasonablydeterioratedthroughthefaultornegligenceoftheagricultural
lessee

(6)Theagriculturallesseedoesnotpaytheleaserentalwhenitfallsdue:Provided,Thatif
thenonpaymentoftherentalshallbeduetocropfailuretotheextentofseventyfivepercentum
asaresultofafortuitousevent,thenonpaymentshallnotbeagroundfordispossession,although
theobligationtopaytherentalduethatparticularcropisnottherebyextinguishedor

(7)Thelesseeemployedasublesseeonhislandholdinginviolationofthetermsofparagraph
2ofSectiontwentyseven.

Intheinstantcase,theTanHeirsseekReynaldasejectmentfromtheLandontheground
ofnonpaymentofleaserental.

TheCourtagreeswiththeCourtofAppealsthatfornonpaymentoftheleaserentaltobe
avalidgroundtodispossesstheagriculturallesseeofthelandholding,theamountofthelease
rentalmustfirstofallbelawful.Iftheamountofleaserentalclaimedexceedsthelimitallowed
bylaw,nonpaymentofleaserentalcannotbeagroundtodispossesstheagriculturallesseeof
thelandholding.

 [29]
Section34ofRA3844asamended mandatesthatnotxxxmorethan 25% of the
averagenormalharvestshallconstitutethejustandfairrentalforleasehold.Inthiscase,theTan
HeirsdemandedReynaldatodeliver2/3oftheharvestasleaserental,whichclearlyexceeded
the25%maximumamountprescribedbylaw.Therefore,theTanHeirscannotvalidlydispossess
Reynaldaofthelandholdingfornonpaymentofrentalpreciselybecausetheleaserentalclaimed
bytheTanHeirsisunlawful.

EvenassumingReynaldaagreedtodeliver2/3oftheharvestasleaserental,Reynaldais
not obliged to pay such lease rental for being unlawful. There is no legal basis to demand
paymentofsuchunlawfulleaserental.Thecourtswillnotenforcepaymentofaleaserentalthat
violatesthelaw.Therewasnovalidlyfixedleaserentaldemandableatthetimeoftheharvests.
Thus,Reynaldawasneverindefault.

ReynaldaandtheTanHeirsfailedtoagreeonalawfulleaserental.Accordingly,theDAR
mustfirstfixtheprovisionalleaserentalpayablebyReynaldatotheTanHeirspursuanttothe
[30]
second paragraph of Section 34 of RA 3844 as amended. Until the DAR has fixed the
provisionalleaserental,Reynaldacannotbeindefaultinthepaymentofleaserentalsincesuch
amountisnotyetdetermined.Therecanbenodelayinthepaymentofanundeterminedlease
rental because it is impossible to pay an undetermined amount. That Reynalda is not yet in
defaultinthepaymentoftheleaserentalisabasicreasonwhyshecannotbelawfullyejected
[31]
fromtheLandfornonpaymentofrental.

Nogroundforextinguishmentofleaseholdrelation

TheCourtalsoholdsthatthereisnogroundfortheextinguishmentofleaseholdrelation
inthiscase.
 OnlyintheinstancesstatedinSections8and28ofRA3844asamendedcanleasehold
relationbeterminated.Theseprovisionsread:

SEC. 8. Extinguishment of Agricultural Leasehold Relation.The agricultural leasehold relation

establishedunderthisCodeshallbeextinguishedby:

(1)Abandonmentofthelandholdingwithouttheknowledgeoftheagriculturallessor

(2)Voluntarysurrenderofthelandholdingbytheagriculturallessee,writtennoticeof
whichshallbeservedthreemonthsinadvanceor

(3)AbsenceofthepersonsunderSectionninetosucceedtothelessee,intheeventof
deathorpermanentincapacityofthelessee.

SEC. 28. Termination of Leasehold by Agricultural Lessee During Agricultural Year.The
agricultural lessee may terminate the leasehold during the agricultural year for any of the
followingcauses:

(1)Cruel,inhumanoroffensivetreatmentoftheagriculturallesseeoranymemberof
hisimmediatefarmhouseholdbytheagriculturallessororhisrepresentativewiththeknowledge
andconsentofthelessor

(2)Noncomplianceonthepartoftheagriculturallessorwithanyoftheobligations
imposeduponhimbytheprovisionsofthisCodeorbyhiscontractwiththeagriculturallessee

(3) Compulsion of the agricultural lessee or any member of his immediate farm
household by the agricultural lessor to do any work or render any service not in any way
connectedwithfarmworkorevenwithoutcompulsionifnocompensationispaid






(4)Commissionofacrimebytheagriculturallessororhisrepresentativeagainstthe
agriculturallesseeoranymemberofhisimmediatefarmhouseholdor

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


The case of Garchitorena v. Panganiban which the Tan Heirs invoked to justify the
extinguishmentofleaseholdrelationdoesnotappearonpage339ofVolume8oftheSupreme
Court Reports Annotated. What is printed on such page is the case of Republic v. Perez with
docket number L16112 and promulgated on 29 June 1963. For making a wrong citation, the
Court admonishes Atty. Jesus S. Anonat, counsel for the Tan Heirs, to be more careful when
citingjurisprudence.TheCourtremindshimofhisdutynottoknowinglymisquotethetextofa
[32]
decisionorauthority lesthebeguiltyofmisleadingtheCourt.

WHEREFORE,theCourtDENIESthepetitionandAFFIRMStheassailedDecisiondated31
August 2000 of the Court of Appeals in CAG.R. SP No. 48823. The Court REMANDS this
casetotheDepartmentofAgrarianReformforthedeterminationoftheprovisionalleaserental.
Costsagainstpetitioners.

SOORDERED.

ANTONIOT.CARPIO
AssociateJustice

WECONCUR:

HILARIOG.DAVIDE,JR.
ChiefJustice
Chairman

LEONARDOA.QUISUMBINGCONSUELOYNARESSANTIAGO
AssociateJusticeAssociateJustice

 ADOLFOS.AZCUNA
AssociateJustice




CERTIFICATION

PursuanttoSection13,ArticleVIIIoftheConstitution,itisherebycertifiedthattheconclusions
intheaboveDecisionwerereachedinconsultationbeforethecasewasassignedtothewriterof
theopinionoftheCourtsDivision.

HILARIOG.DAVIDE,JR.
ChiefJustice

[1]
UnderRule45oftheRulesofCourt.
[2]
Penned by Associate Justice Romeo A. Brawner, with Associate Justices Quirino D. Abad Santos, Jr. and Andres B. Reyes, Jr.
concurring.
[3]
AlsospelledasRomelintheRecords.
[4]
Rollo,p.8.
[5]
Ibid.
[6]
Ibid.ThecomplaintwasdocketedasDCNX(07)666.
[7]
Ibid.
[8]
Ibid.
[9]
Ibid.
[10]
UnderArticle3151(b)oftheRevisedPenalCode.
[11]
Rollo,pp.89.
[12]
Ibid.,p.9.ThecasewasdocketedasDARABCaseNo.X(07)821.
[13]
ThroughRegionalAdjudicatorJimmyV.Tapangan.
[14]
Rollo,pp.7071.
[15]
Ibid., p. 77. The decision was penned by DAR Assistant Secretary Lorenzo R. Reyes as ViceChairman, with Undersecretaries
ArtemioA.Adasa,Jr.andVictorGerardoJ.Bulatao,AssistantSecretariesAugustoP.Quijano,SergioB.Serrano,andCliffordC.
BurkleyasMembers,concurring.SecretaryErnestoD.GarilaoasDARABChairmandidnottakepart.
[16]
111Phil.737(1961).
[17]
Rollo,p.12.
[18]
Ibid.,p.13.
[19]
Ibid.
[20]
Ibid.,pp.124125.
[21]
RA6389amendedRA3844andchangedthistitletoCodeofAgrarianReformsofthePhilippines.
[22]
Monv.CourtofAppeals,G.R.No.118292,14April2004,427SCRA165.
[23]
Section4ofRA3844asamendedbyRA6389provides:

SEC.4.AutomaticConversiontoAgriculturalLeasehold.Agriculturalsharetenancythroughoutthecountry,ashereindefined,is
herebydeclaredcontrarytopublicpolicyandshallbeautomaticallyconvertedtoagriculturalleaseholdupontheeffectivityof
thissection.

SeealsoMonv.CourtofAppeals,supranote22.
[24]
AnActtoGoverntheRelationsBetweenLandholdersandTenantsofAgriculturalLands.
[25]
Monv.CourtofAppeals,supranote22.
[26]
Ibid.
[27]
Ibid.
[28]
Ibid.
[29]
SEC.34.ConsiderationfortheLeaseofRicelandandLandsDevotedtoOtherCrops.Theconsiderationfortheleaseofriceland
and lands devoted to other crops shall not be more than the equivalent of twentyfive per centum of the average normal
harvestxxx.(emphasissupplied)

[30]
ThesecondparagraphofSection34ofRA3844asamendedreads:
Intheabsenceofanyagreementbetweenthepartiesastotherental,theCourtofAgrarianRelationsshallsummarily
determineaprovisionalrentalinpursuanceofexistinglaws,rulesandregulationsandproductionrecordsavailableinthe
differentfieldunitsofthedepartment,takingintoaccounttheextentofthedevelopmentofthelandatthetimeofthe
conversionintoleaseholdandtheparticipationofthelesseeinthedevelopmentthereof.Thisprovisionalrentalshallcontinue
inforceandeffectuntilafixedrentalisfinallydetermined.Thecourtshalldeterminethefixedrentalwithinthirtydaysafter
thepetitionissubmittedfordecision.
SeeMonv.CourtofAppeals,supranote22.
[31]
SeeBelmontev.Marin,76Phil.198(1946),wheretheCourtruledthatthelesseewasnotindefault,andthuscouldnotbeejected
forfailuretopayarentalamountthatexceededwhathadbeenagreeduponbythelesseeandlessor.
[32]
Rule10.02oftheCodeofProfessionalResponsibilityprovides:

Rule 10.02. A lawyer shall not knowingly misquote or misrepresent the contents of a paper, the language or the argument of
opposingcounsel,orthetextofadecisionorauthority,orknowinglyciteasalawaprovisionalreadyrenderedinoperativeby
repealoramendment,orassertasafactthatwhichhasnotbeenproved.

See Insular Life Assurance Co., Ltd. Employees Association NATU, et al. v. Insular Life Assurance Co., Ltd., et al., 147 Phil. 194
(1971).