JUAN GALOPE, PETITIONER, VS. CRESENCIA BUGARIN, REPRESENTED BY CELSO RABANG, RESPONDENT.

Galope versus Bugarin

The Case

This is a petition for review brought by Juan Galope against Cresencia Bugarin, who is represented in the proceedings by Celso Rabang. The respondent landowner sought to recover possession of her agricultural land, to eject the petitioner, and to collect rentals before the Department of Agrarian Reform Adjudication Board. The petitioner insists that he is not a mere borrower of the land but a tenant entitled to security of tenure. The case matters because it gathers in one place the six essential elements of an agricultural tenancy relationship, the rule that such a relationship may arise from an oral or implied agreement, and the rule that the landowner bears the burden of proving a lawful ground for ejectment.

Procedural History

The dispute began in the barangay, where the respondent complained that the petitioner gave her only an insignificant return for the use of her land. The case was not settled. The respondent then filed a petition for recovery of possession, ejectment, and payment of rentals before the Department of Agrarian Reform Adjudication Board. The Provincial Adjudicator dismissed the petition and held that the petitioner is a tenant entitled to security of tenure, finding substantial evidence of a tenancy relationship. On appeal, the Board reversed the Adjudicator. It ruled that the petitioner is not a tenant by law, ordered him to pay rentals and to vacate the land, and directed the Municipal Agrarian Reform Officer to assist in computing the rentals. The petitioner elevated the matter to the Court of Appeals, which affirmed the Board in full. The petitioner then came to the Supreme Court by petition for review, assigning as errors the appellate court's failure to consider the totality of the evidence, its reliance on the absence of rental receipts, and its finding that he had not discharged his burden of proof.

Facts

The respondent owns a parcel of agricultural land in Santo Domingo, Nueva Ecija, covered by a transfer certificate of title. The petitioner farms that land. In the barangay proceedings, the respondent claimed that she had lent the land to the petitioner in 1992 without any agreement, that what she receives from him is insignificant, and that she wants the land back so she can farm it herself. The petitioner answered that he had long been farming the land and that he pays rent ranging from 4,000 to 6,000 pesos, or fifteen cavans of palay, per harvest.

Before the Board, the respondent's representative claimed that she lent the land in 1991 and that the petitioner gave nothing in return, whether as gratitude or as monetary consideration. He also claimed that the petitioner had mortgaged the land to Jose Allingag, who allegedly possessed it. The Provincial Adjudicator found for the petitioner, noting the certification of the Department of Agrarian Reform that he is the registered farmer of the land, the statements of barangay tanods that he is the tenant, the affidavit of Allingag that he is merely the petitioner's farm helper, and the testimony of the respondent's own witness that the petitioner is a farmer of the land.

The Board and the Court of Appeals took the opposite view. They found that the elements of consent and sharing were absent, that the petitioner had failed to prove his rental payments by receipts, that the affidavits he offered were self-serving, and that the respondent's act of lending her land without consideration could not be taken as an implied tenancy.

Issues

• Whether or not there exists an agricultural tenancy relationship between the petitioner and the respondent.
• Whether or not there is a valid ground to eject the petitioner from the landholding.

Applicable Provisions

Section 5 of Republic Act Number 3844, the Agricultural Land Reform Code, provides:

Section 5. Establishment of Agricultural Leasehold Relation. The agricultural leasehold relation shall be established by operation of law in accordance with Section 4 of this Code and, in other cases, either orally or in writing, expressly or impliedly.

This provision defeats the argument that the absence of a written contract negates tenancy, for it recognizes that the relation may arise from an oral or implied agreement.

Section 7 of the same Code provides:

Section 7. Tenure of Agricultural Leasehold Relation. The agricultural leasehold relation once established shall confer upon the agricultural lessee the right to continue working on the landholding until such leasehold relation is extinguished. The agricultural lessee shall be entitled to security of tenure on his landholding and cannot be ejected therefrom unless authorized by the Court for causes herein provided.

This is the source of the petitioner's security of tenure once his status as tenant is established.

Section 36 of the same Code, as quoted in the decision, provides:

Section 36. Possession of Landholding; Exceptions. Notwithstanding any agreement as to the period or future surrender of the land, an agricultural lessee shall continue in the enjoyment and possession of his landholding except when his dispossession has been authorized by the Court in a judgment that is final and executory if after due hearing it is shown that: (1) The agricultural lessor-owner or a member of his immediate family will personally cultivate the landholding or will convert the landholding, if suitably located, into residential, factory, hospital or school site or other useful non-agricultural purposes: Provided, That the agricultural lessee shall be entitled to disturbance compensation equivalent to five years rental on his landholding in addition to his rights under Sections 25 and 34, except when the land owned and leased by the agricultural lessor is not more than five hectares, in which case instead of disturbance compensation the lessee may be entitled to an advance notice of at least one agricultural year before ejectment proceedings are filed against him: Provided, further, That should the landholder not cultivate the land himself for three years or fail to substantially carry out such conversion within one year after the dispossession of the tenant, it shall be presumed that he acted in bad faith and the tenant shall have the right to demand possession of the land and recover damages for any loss incurred by him because of said dispossession; (2) The agricultural lessee failed to substantially comply with any of the terms and conditions of the contract or any of the provisions of this Code unless his failure is caused by fortuitous event or force majeure; (3) The agricultural lessee planted crops or used the landholding for a purpose other than what had been previously agreed upon; (4) The agricultural lessee failed to adopt proven farm practices as determined under paragraph 3 of Section 29; (5) The land or other substantial permanent improvement thereon is substantially damaged or destroyed or has unreasonably deteriorated through the fault or negligence of the agricultural lessee; (6) The agricultural lessee does not pay the lease rental when it falls due: Provided, That if the non-payment of the rental shall be due to crop failure to the extent of seventy-five per centum as a result of a fortuitous event, the non-payment shall not be a ground for dispossession, although the obligation to pay the rental due that particular crop is not thereby extinguished; or (7) The lessee employed a sub-lessee on his landholding in violation of the terms of paragraph 2 of Section 27.

These are the only grounds on which the respondent could have ejected the petitioner, and she proved none of them.

Section 37 of the same Code provides:

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

This placed the burden squarely on the respondent as landowner.

Section 7 of Republic Act Number 6389 amended Section 36 of the earlier Code, and the decision quotes the amended paragraph as follows:

Section 7. Section 36 (1) of the same Code is hereby amended to read as follows: (1) The landholding is declared by the department head upon recommendation of the National Planning Commission to be suited for residential, commercial, industrial or some other urban purposes: Provided, That the agricultural lessee shall be entitled to disturbance compensation equivalent to five times the average of the gross harvests on his landholding during the last five preceding calendar years.

Because of this amendment, the owner's desire to personally cultivate the land is no longer a ground for ejectment.

Ruling

On the first issue, the Court ruled that a tenancy relationship exists. It laid down the six essential elements: the parties are the landowner and the tenant or agricultural lessee; the subject matter is agricultural land; there is consent between the parties to the relationship; the purpose is to bring about agricultural production; there is personal cultivation by the tenant; and the harvest is shared between the landowner and the tenant. The Court found all six present. The respondent is the landowner and the petitioner her tenant; the land is farmland; they agreed to its cultivation and to a sharing of the harvest; the purpose was agricultural production; the petitioner personally cultivated the land; and after harvest he paid rental in palay or its cash equivalent.

The Court rejected the finding that sharing was absent. The absence of receipts was beside the point, because the respondent herself admitted in the barangay case that she receives rentals from the petitioner, complaining only that the amount is small. That admission, signed by her and attached to her own Board petition, confirmed the affidavits that rentals were in fact being paid, and it belied her representative's claim that the petitioner paid nothing. The Court likewise held that the respondent's act of allowing the petitioner to cultivate the land and receiving rentals for it showed her consent to an unwritten tenancy agreement, since an agricultural leasehold relation is not determined by the explicit provisions of a written contract alone.

On the second issue, the Court held that there was no valid ground for ejectment. The burden lay on the respondent as agricultural lessor, and she failed to prove any of the statutory grounds. Her admission defeated the claim of nonpayment. The supposed mortgage was denied by Allingag himself, no deed of mortgage was offered, and the claim rested on hearsay. Allingag's possession was likewise hearsay, for he stated that he was merely the petitioner's farm helper, and the hiring of farm laborers on a temporary, occasional, or emergency basis does not negate personal cultivation. Finally, the respondent's claim that she will cultivate the land is no longer a valid ground, because the original paragraph 1 of Section 36 was removed by the amendment in Republic Act Number 6389.

Doctrine

An agricultural tenancy relationship has six essential elements: the parties are the landowner and the tenant or agricultural lessee; the subject matter is agricultural land; there is consent between the parties; the purpose is agricultural production; there is personal cultivation by the tenant; and the harvest is shared. All six must concur, and the tenant bears the burden of proving them by substantial evidence.

Consent to the tenancy need not be written. Under Section 5 of Republic Act Number 3844, the leasehold relation may be established orally or in writing, expressly or impliedly, and the landowner's act of allowing cultivation while receiving rentals shows consent to an unwritten tenancy agreement.

Once the tenancy relationship is established, the tenant is entitled to security of tenure under Section 7 and may be ejected only on a ground provided by law. Under Section 37, the burden of proving a lawful cause for ejectment rests on the agricultural lessor. Nonpayment of rental is a ground under Section 36, but it must be proved, and the landowner's own admission that she receives rentals defeats the claim. The hiring of farm laborers on a temporary, occasional, or emergency basis does not negate personal cultivation.

Disposition

The Court granted the petition, reversed the Court of Appeals, and dismissed the respondent's ejectment petition insofar as the petitioner is concerned, without pronouncement as to costs.

Remember This

Memorize the six elements of agricultural tenancy and the rule that consent may be implied from the landowner's acceptance of rentals, for that single line decides the case. Examiners use this case to test the elements of tenancy, the burden of proof in ejectment under Section 37, and the effect of the amendment that removed personal cultivation by the owner as a ground for dispossession.