MANUEL V. GALLEGO, ET AL., PETITIONERS, VS. KAPISANAN TIMBULAN NG MGA MANGGAGAWA, RESPONDENT.,

Respondent filed with the Court of Industrial Relations a complaint alleging
that it is an organization of tenants and farm laborers duly registered in
accordance with law counting with more than 1,200 members who are tenants of
petitioners Manuel Gallego, Manuel Alzate, Victor de los Reyes, Emilio Veloso,
Consuelo de los Santos de Barcelona and Jose Mariano de Santos, owners of
haciendas situated in the Municipalities of Nampicuan and Cuyapo, Nueva Ecija,
and that petitioners “had, by means of threat, intimidation, fraud and deceit,
taken advantage of the ignorance of their tenants, forced tenants represented by
petitioners (herein respondents) to enter into contracts of tenancy the
provisions of which are against existing and public policy,” and that the
non-immediate settlement or arbitration of the controversy “will cause or likely
cause an agrarian disorder among the peasantry not only in the places involved
in the complaint but in all other places where general discontent and social
unrest prevail among the tenants who feel they have long been cheated of the
benefits provided for them in the tenancy law.”

Complainants prayed that the contracts be declared repugnant to the spirit
and the provisions of the Philippine Rice Share Tenancy Act (No. 4054, as
amended), and null and void; that with intervention of the court other tenancy
contracts be executed embodying substantially the provisions of said law and
that, pending the disposition of the case, an order be entered restraining the
herein petitioners from ejecting any of their tenants except for just cause or
causes and with the previous approval and consent of the court.

Herein petitioners moved for the dismissal of the complaint upon four
grounds: One, lack of original jurisdiction; two, lack of cause of action;
three, lack of legal capacity to sue; four, defect of both parties plaintiff and
defendant. On August 29, 1947, the lower court denied the motion to dismiss. On
September 6, 1947, motion for reconsideration was filed, which was denied on
November 6, 1947.

Petititioners seek the reversal of the action taken by the Court of
Industrial Relations in refusing to dismiss the complaint. Four errors are
attributed by petitioners to the lower court. We will consider them in the order
they are presented in the brief.

I

“The Court of Industrial Relations erred in holding that it has jurisdiction
over the subject matter of the action.” In support of this proposition,
petitioners invoked the provisions of section 1 of Commonwealth Act No. 103, as
amended by Commonwealth Acts No. 254 and 559 and section 1 of Commonwealth Act
No. 461, both reading as follows:

“SECTION 1. Jurisdiction—Judges.—There is created a Court of
Industrial Relations hereinafter called the court, which shall have jurisdiction
over the entire Philippines, to consider, investigate, decide, and settle all
questions, matters, controversies, or disputes arising between, and/or affecting
employers and employees or laborers, and landlords and tenants or farm-laborers,
and regulate the relation between them subject to the provisions of this
Act.

“The Court shall also have jurisdiction over cases submitted to it under the
provisions of Commonwealth Act Numbered Four hundred and sixty-one.” (As Amended
by Commonwealth Acts Nos. 254 and 559.)

“SECTION 1. Any agreement or provision of law to the contrary
notwithstanding, in all cases where land is held under any system of tenancy the
tenant shall not be dispossessed of the land cultivated by him except for any of
the causes mentioned in Section nineteen of Act Numbered Four thousand and
fifty-four or for any just cause, and without the approval of a representative
of the Department of Justice duly authorised for the purpose. The Department of
Justice is likewise, charged with the duty of enforcing all the laws, orders and
regulations relating to any system of tenancy and it may issue such orders as
may be necessary in pursuance thereof, such as, with respect to the liquidation
of the crop, the division thereof, and the apportionment of the expenses. Should
landowner or the tenant feel aggrieved by the action taken by the Department of
Justice under the authority herein granted, or in the event of any dispute
between them arising out of the relationship as landowner and tenant, either
party may appeal within fifteen receipt of notice of the action days from taken
by the Department of Justice, or resort, as the case may be, to the Court of
Industrial Relations which is given jurisdiction to determine the controversy in
accordance with law. The filing of an appeal shall stay execution of the action
appealed from unless the Court of Industrial Relations shall, for special
reason, order the immediate execution thereof upon the filing of a supersedeas
bond.”

Petitioners contend that although the Court of Industrial Relations is vested
with determine any dispute or controversy jurisdiction to arising from, the
relationship between tenant and landowner, respondent’s action is one for
nullity of contracts and it is not one arising from the relationship of
petitioners as landlords and respondent as tenants. The controversy must be
brought, according to petitioners, before a court of general jurisdiction.

Respondent’s complaint alleges that their members are tenants of petitioners
who, by means of threat, intimidation, fraud and deceit, taking advantage of the
ignorance of the tenants, forced them to enter into contracts the provisions of
which are against existing laws and public policy, and that the non-settlement
of the controversy arising therefrom will cause an agrarian disorder among the
peasantry. This allegation is enough to place the controversy within the purview
of section 1 of Commonwealth Act No. 103, as amended. The allegation states a
controversy between respondent, as tenants, and petitioners, as landlords. The
fact that the nullity of tenancy contracts is involved, does not place the
controversy beyond the jurisdiction of the Court of Industrial Relations. The
jurisdiction provided in section 1 of Commonwealth Act No. 103, as amended,
includes “all questions, matters, controversies, or disputes * * * between
landlords and tenants or farm laborers,” without any exception or limitation as
to their nature and, therefore, also includes questions involving the nullity of
contracts.

II

“The Court of Industrial Relations erred in holding that the action is not
one for nullity of contracts.” Whether or not the controversy involves a nullity
of contracts is immaterial in view of the conclusion on petitioners’ first
assignment of error.

III

“The Court of Industrial Relations erred in holding that respondent has legal
capacity to sue for the annulment of contract of its members.” In support of
this assignment of error, petitioners invoked the provisions of section 2 of
Rule 3 and articles 1302 and 1257 of the Civil Code which read:

“SEC. 2. Parties in interest.—Every action must be prosecuted in the
name of the real party in interest.”

“ART. 1302. The action to annul a contract may be brought by any person
principally or subsidiarily bound thereby. Persons sui juris cannot,
however, avail themselves of the incapacity of those with whom they contracted;
neither can the person who caused the intimidation or violence, employed the
deceit, or induced the error, base his action on these defects of the
contract.”

“ART. 1257. Contracts shall be binding only upon the parties who make them
and their heirs, excepting, with respect to the latter, cases in which the
rights and obligations arising from the contract are not transmissible, either
in consequence of their nature, or by agreement, or by provision of law.

“Should the contract contain any stipulation in favor of a third person, he
may demand its fulfillment, provided he has given notice of his acceptance to
the person bound before the stipulation has been revoked.”

Respondent’s allegation to the effect that the complaining tenants are
members of respondent Kapisanan Timbulan ng mga Manggagawa, a labor organization
duly registered in accordance vrith law, is enough to give said organization
legal personality for purposes of filing the complaint with the Court of
Industrial Relations. Section 2 of Com. Act No. 2113 provides:

“SEC. 2. All associations which are duly organized and registered with, and
permitted to operate by, the Department of Labor, shall have the right to
collective bargaining with employers for the purpose of seeking better working
hours for laborers, and, in general, to promote the material, social and moral
well-being of their members, and no labor organization shall be denied such
registration and permission to operate, except such whose object is to undermine
and destroy the constituted government or to violate any law or laws of the
Philippines, in which case it shall be refused registration and permission to
operate as a legitimate labor organization. The registration of, and the
issuance of a permit to, any legitimate labor organization shall entitle it to
all the rights and privileges granted by law.”

The foregoing provision is in line with the modern trend of the law in
recognizing the personality of labor unions to represent their members before
the constituted authorities. The existence of labor unions is a necessary
development of the industrial revolution and is recognized as one of the
effective means by which laborers may obtain protection to their rights and
privileges, social justice within an economic set-up dominated by capitalism,
and vindicate the laborer’s just claims to human dignity and his due share in
the benefits accruing in the inter-play of the modern social system of
production, distribution and consumption.

IV

“The Court of Industrial Relations erred in holding that respondent has the
right of collective bargaining in matters relating to rice tenancy.”

Sections 8 and 22 of Act No. 4054 as amended by Republic Act No. 34, invoked
by petitioners to show that respondent has no occasion or necessity for
collective bargaining read as follows:

“SEC. 8. Share Basis.—In the absence of any written agreement to the
contrary and when the tenant furnishes the necessary implements and the work
animals and defrays all the expenses for planting and cultivation of the land,
the crop shall be divided as follows: the tenant shall receive seventy per cent
of the net produce of the land and the landlord thirty per cent, for first-class
land, the normal production of which, based on the average yield for the three
preceding years, is more than forty cavans of palay per one cavan of seeds;
seventy-five per cent for the tenant and twenty-five percent for the landlord,
in case of land the average normal production of which is not more than forty
cavans of palay per one cavan of seeds. In the landlord furnishes the necessary
work animals and farm implements and, likewise, bears all the expenses of
planting and cultivation, the landlord shall receive seventy per cent and the
tenant thirty per cent of tiie crop; but if the landlord furnishes the necessary
work animals and farm implements and bears equally with the tenant the expenses
of planting and cultivation, the crop shall be divided equally between the
parties.

“Expenses for harvesting and threshing shall be deducted from the gross
produce. Expenses for the maintenance of irrigation systems within the
respective areas shall be for the account of the tenant, but amortizations for
the cost of construction of the system itself shall be for the account of the
landlord. The expenses for construction and maintenance of privately owned
irrigation systems shall be agreed upon between thfe landlord and tenant, but in
case of disagreement, all expenses for the construction of the system shall be
for the account of the landlord, provided that the cost of constructing the
distributing canals shall be for the account of the tenant.

“The division shall be made in the same place where the crop has been
threshed and each party shall transport his share to his warehouse, unless the
contrary is stipulated by the parties.”

“SEC. 22. Lot for dwelling.—The tenant shall be entitled to construct
a dwelling on the land cultivated by him, if he chooses, and once a dwelling is
constructed, he shall be entitled to a sized residential lot of not less than
six hundred square meters, but not exceeding one thousand square meters in area,
depending upon the availability of suitable land and the area cultivated by the
tenant belonging to the landowner, the same to be devoted to the purposes of a
garden, poultry and such other minor industries as may be necessary for his
livelihood, the products of which shall accrue to the tenants exclusively;
Provided, that the tenant shall be given forty-five days within which, to
remove his house from the land of the landlord in the event of the cancellation
of the contract of tenancy for any reasons Provided, further, That in
case he fails to devote the lot allotted to him for the purpose herein mentioned
for a period of six months, it shall revert to the cultivation of
palay.”

Petitioners argue that what a labor organization may do for its tenant
members has already been provided for by these provisions of law and that the
landowner, whether he likes it or not, has to comply therewith and the tenant
cannot ask for more than that provided by law.

The argument has no merit in view of the very fact that the Kapisanan
Timbulan ng mga Manggagawa complains that the tenancy contracts in question are
against existing laws and public policy and repugnant to the spirit and
provisions of the Philippine Rice Share Tenancy Act, No. 4054, as amended.
Petitioners’ allegation that the landowner has to comply with the provisions of
said act is a mere theory that cannot prevail against the specific charge that
said law is being violated; and it is an intolerable injustice to deprive the
members of respondent labor organization of the proper remedy by denying to the
latter the right to collective bargaining and to go to the Court of Industrial
Relations on behalf of its members.

The petition for the writ of certiorari, being unmeritorious as above stated,
is dismissed. Petitioners shall pay the costs.

Moran, C.J., Paras, Feria, Pablo, Bengzon, Briones, Tuason, and
Reyes, JJ., concur.