FELIX POTENCIANO, AS JUDICIAL ADMINISTRATOR OF THE INTESTATE ESTATE OF THE LATE POLICARPO CALMA, PETITIONER, VS. ANDRES ESTEFANI, RESPONDENT.

This is a petition for review of a decision of the Court of Industrial
Relations dated December 29, 1953, which was affirmed by the court in
banc on March 8, 1954, ordering Felix Potenciano, petitioner herein, to
deliver to Andres Estafani, respondent, 81.2 cavans of palay, or their current
market value, for damages suffered by the latter as a consequence of his illegal
ejectment from the land he was working on as tenant.

Andres Estefani was formerly a tenant of a parcel of land containing 4-1/2
hectares situated in Magarao, Camarines Sur. The land belonged to Policarpo
Calma, deceased, and was under the administration of Felix Potenciano. The land
was allegedly leased to one Cenon Armendi who sometime in February, 1951 ejected
Estefani from the land and threatened to demolish the house he had thereon. So
on February 19, 1951 he filed a complaint against Felix Potenciano and Cenon
Armendi with the Court of Industrial Relations praying for a liquidation of the
harvest for 1950 and for his reinstatement as tenant of the land (Tenancy Case
No. 1406-R). After the usual hearing, the court found that, while the harvest of
the land since the crop of 1947 had been liquidated on the 60-40 ratio in favor
of the tenant, the 70-30 ratio should be the one to be reckoned with for the
year 1950, and ordered that the complainant be paid the difference of 10% or 5.8
cavans of palay. The court also ordered Felix Potenciano to reinstate the
complainant and to pay him the losses and damages he may have sustained as a
consequence of his unlawful dismissal.

Because Andres Estefani has not
been reinstated immediately as ordered in the decision, and fearing that he may
be deprived of his share of the harvest for several years, he filed a second
complaint against the same parties praying that the court fix the damages he is
entitled to in line with said decision (Tenancy Case No. 4079-R). Respondents
resisted this claim alleging that, during the pendency of the first case, tenant
Estefani cultivated a neighboring property thus making his claim for damages
made, and that, even if he were entitled to damages, the expenses of
cultivation, harvesting, irrigation and the like which he would have spent if he
had personally cultivated the land should be deducted from his claim for
damages. The court found this pretense untenable and, on December 29, 1953,
ordered Felix Potenciano to deliver to Andres Estefani 81.2 cavans of palay, or
their current market value, as damages suffered by the latter during the crop
years of 1951 and l952. This decision having been affirmed by the court
in banc, Felix Potenciano interposed the present petition for
review.

It appears proven in the decision that the share of the tenant for the
agricultural year immediately preceding his ejectment,- or the year 1950,- was
equivalent to 70% of the net harvest of 58 cavans of palay, or a total of 40.6
cavans, and that, from the time the tenant was illegally ejected up to the time
of his reinstatement, a period of two agricultural years had elapsed. And so the
court ordered that the tenant be paid 81.2 cavans of palay for said agricultural
years. The question now to be determined is: In computing the damages to which
the tenant is entitled as a consequence of his illegal ejectment is the landlord
entitled to be reimbursed of the expenses of planting, cultivation, harvesting
and other similar expenses which the tenant would have spent had he worked the
land personally?

The law on this point is Sectio 19 of Act No. 4054. Said section provides
that “The landlord shall not dismiss his tenant without just and reasonable
cause, otherwise the former shall be liable to the latter for losses and damages
to the extent of his share in the product of the land entrusted to the
dismissed tenant.” These provisione are clear and simple. They provided far the
measure of the losses and damages to which a dismissed tenant is entitled. They
employ the phrase “to the extent of his share in the product” which can only
mean the share the tenant should receive if he had personally worked the land.
And, as we know? this share is arrived at after deducting the expenses of
harvesting and threshing from the gross produce as provided for by law (Section
8, Act No. 4054). The tenant therefore is entitled to this share without
diminution. This is precisely what was done in the present case. The
oourt fixed the net produce and on this basis awarded to the
tenant the share of 70% for the agricultural years 1951 and 1952. Thus, the
court said that the tenant was entitled to a share “equivalent to 70% of the
net harvest of 58 cavanes or a total amount of 40.6 cavanes of palay” for
each year. The court therefore interpreted correctly the law on this
matter.

But there is merit in the contention that the income which the
tenant had earned during the period of his ejectment should at least be deducted
from his claim for damages if we are to equalize the equities of both parties in
the determination of their rights and liabilities. It is true that there is
nothing in the special law (Act No. 4054) on which we may predicate the right of
a landlord to deduct the income which a dismissed tenant may have earned during
his ejectment from the damages he may be liable to pay as a result of the
ejectment, but in such a case the general principles of law should apply. This a
matter of equity. Thus, the new Civil Code provides “The party suffering loss or
injury must exercise the diligence of a good father of a family to minimize the
damages resulting from the act or omission in question” (Article 2203). And this
Court has held that “an employee who is improperly discharged is under an
obligation to use reasonable diligence to obtain other suitable employment and
that in assessing the damages for the period which is still to run after the
breach, the court may properly take into account the probability that the
discharged employee will be able to earn money in other employment.” (Garcia
Palomar v. Hotel de France Co., 42 Phil., 660, quoted in Sotelo v. Behn, Meyer
& Co., 57 Phil., 775.) Since there is evidence to show that during his
ejectment the tenant was able to cultivate the ricelands of Regino Cano and
Paula Arce containing an area of almost two hactares and that during the two
agricultural years of 1951 and 1952 he received a share of at least 8 cavans of
palay for each year, or a total of 16 cavans, it is the sense of this Tribunal
that this earning should be deducted from the cavans of palay awarded to him in
the decision appealed from.

With regard to the defense of res
adjudicata set up by the landlord, we find that it was not raised in the
trial court. This defense is therefore deemed waived (Section 10, Rule 9, Rules
of Court). However, even if this defense were available, same has no merit for
it appears that the first case (Case No. 1406-R) refers to a liquidation of the
crop for the years 1951, whereas the second case (Case No. 4079-R) is an action
for damages for the years 1951 and 1952. The two cases therefore refer to a
different subject-matter.

Wherefore, the decision of the lower court dated December 29, 1953 is hereby
modified in the sense that the 16 cavans of palay which were earned by the
tenant during his ejectment should be deducted from the total of 81.2 cavanes of
palay awarded to him in said decision. No costs.

Bengzon, Padilla, Montemayor, Reyes, Jugo, Labrador, Concepcion, and
Reyes, J.B.L., concur.