TIMOTEO MAGNO, PETITIONER, VS. FLORENTINA BLANCO AND SESINANDO ACOSTA AND COURT OF APPEALS, RESPONDENTS.

This is a petition for review on certiorari seeking to reverse
and set aside the decision of respondent Court of Appeals^[1] in CA-G.R. No. CV-07742 entitled
“Sesinando Acosta, et al. vs. Timoteo Magno,” which set
aside the decision of the Regional Trial Court (RTC) of Pangasinan,
Branch XLV, Urdaneta in Civil Case No. U-3865, an
action for Recovery of Ownership and Possession with Damages, which among
others dismissed the complaint; declared null and void the Sheriff’s sale of
the two parcels of land in question and ordered the Register of Deeds to cancel
the corresponding annotations on the title.

Petitioner Timoteo Magno,
a pauper litigant, is the agricultural lessee of a parcel of land with an area
of 10,290.5 square meters located at Sugcong, Urdaneta, Pangasinan owned by
private respondents spouses Florentina Blanco and Sesinando Acosta.  On
June 3, 1971, petitioner
filed with the Court of Agrarian Relations (CAR) a complaint against private
respondents, docketed as CAR Case No. 2121-P’71, for reliquidation,
leasehold and fixing of rentals with damages. 
Judgment was rendered therein on August
6,1971 based on an
amicable settlement between the parties providing as follows:

“1.     That with respect to
the 1/2 eastern portion which is the actual landholding of the plaintiff, the
parties hereby agree that the plaintiff will temporarily pay annual rental in
the amount of twenty (20) cavans of palay at 46 kilos without prejudice to the filing of
personal cultivation by the defendant of which notice was already sent to the plaintiff;

“2.     That with respect to
the 1/2 western portion which the plaintiff has been a hired farm laborer for
plowing and harrowing in the amount of P70.00, the parties agreed to terminate
his being hired and pay him the amount
of P70.00 corresponding to said plowing and harrowing for this agricultural
year which he (has) already done and receipt of which is acknowledged by the
plaintiff;

“3.     That in case the
plaintiff will plant second crop in the eastern 1/2 portion, he also agrees to
pay the defendant 25% of the net produce; and

“4.     That the parties
agree to forego any and all claims and counterclaims which each has against the
other.”^[2]

Thereafter, on April 17,
1974, petitioner filed in said case a motion to reduce the
temporary annual rental of 20 cavans of palay agreed upon in the compromise agreement for being
excessive.  Over the opposition of
private respondents, the CAR reopened
the case and issued an extended Order dated October 22, 1976 reducing the rental to 8 1/4 cavans of palay at 46 kilos per cavan.  On appeal,
however, by private respondents, the Court of Appeals set aside the extended
Order of October 22, 1976
and restored the decision of August 6,
1971, thereby maintaining the original lease rentals of 20 cavans of palay per year.

Despite this reversal by the
appellate court of the October 22,
1976 extended order of the Agrarian Court,
herein petitioner allegedly paid only the
reduced rental of 8 1/4 cavans of palay
annually for the years 1976 to 1979 and totally stopped payment in 1980 resulting in a shortfall of 66.75 cavans
in rental payments.  To recover the
unpaid rentals, private respondent filed in CAR Case No. 2121-P’71 a motion for the issuance of an alias writ
of execution stating, among others, that petitioner incurred arrears of 66.75 cavans and that the prevailing price then of palay was P1.60 per kilo. 
The Agrarian Court
issued an Order directing the issuance of an alias writ of execution to
implement the August 6, 1971
decision in CAR Case No. 2121-P’71.

Consequently,
Deputy Sheriff Benito Gil levied on two (2) parcels of land, both located at Villasis, Pangasinan, registered
in the name of petitioner under Transfer Certificates of Title Nos. 119448 and
112470 and sold the same for the sum of P4,452.22 in a public auction sale to
the highest bidder therein, private respondent Sesinando
Acosta.  Upon expiration of the period of
redemption and petitioner having failed to redeem the levied properties, a
Sheriff’s Final Sale^[3]
was issued on August 26, 1982
in favor of Sesinando Acosta.  The levy and sale were duly annotated at the
back of the aforestated Transfer Certificates of
Title.

When petitioner refused to surrender possession of the subject
lots, private respondents instituted in the Court of First Instance (now
Regional Trial Court) of Pangasinan an action against
herein petitioner for recovery of ownership and possession with damages.^[4]
Resisting the complaint, petitioner attacked the sheriff’s proceedings which
was the source of Acosta’s ownership over the subject lands and claimed that
the sheriff exceeded his authority and/or was without authority in fact and in law to exercise judicial
discretion in fixing the price of 66.75 cavans of palay owing to plaintiff-private respondent.

After hearing, the Regional Trial Court of Pangasinan
found that CAR Case No. 2121-P’71 merely decreed the payment of an annual
rental of 20 cavans of palay
at 46 kilos per cavan but did not specify the price
per kilo, thereby making said judgment “incomplete, not final and cannot
be executed.”^[5]
It ruled that: “inasmuch as the decision failed to determine the value of
the palay rental to be paid to the plaintiffs by the
defendant, the implementing sheriff, being ignorant of the same, has certainly
no authority to settle the matter which involved judicial discretion.”^[6]
Furthermore, the lower court said that if the defendant is truly delinquent,
the remedy of therein plaintiff is to file a complaint against the defendant
for non­payment of rentals and not to apply for an alias writ of execution in
CAR Case No. 2121-P’71.  On the basis of
the foregoing, the lower court rendered a decision on June 26, 1985, the dispositive
portion of which reads:

“WHEREFORE, in view of the foregoing considerations, judgment
is hereby rendered as follows:

“1]          Ordering the
dismissal of the complaint;

“2]          Declaring null
and void the Sheriff’s Sale of the two (2) parcels of land covered by Transfer
Certificates of Title Nos. 119448 and 112470; and

“3]          Ordering the
Register of Deeds of Pangasinan, to cancel the
annotations of the Certificates of Sale and Sheriff’s Final Sale appearing at
the back of Transfer Certificates of
Title Nos. 119448 and 112470.

“The claim and counterclaim for damages by the parties are hereby denied for lack
of merit.

“SO ORDERED.”^[7]

On appeal, the appellate court held that herein petitioner Magno became a judgment debtor under the judgment by
compromise agreement in CAR Case No. 2121-P’71 because this judgment imposed
upon him the obligation to pay the stipulated rentals of 20 cavans
of palayat 46 kilos a cavan
which upon default, could be executed against him.  The appellate court
further said that although the decision in CAR Case No. 2121-P’71 did not
mention the price of palay per kilo,
the application of private respondents for the alias writ of execution which
alleged the price of palay per kilo contains a handwritten Order approving the
same and ordering the issuance of an alias writ of execution.  In other words, the appellate court said that
in approving the motion, the
court also approved the price per kilo of palay.  Consequently, respondent Court of Appeals set
aside the lower court’s judgment, and declared private respondents
(plaintiffs-appellants therein) as the actual owners of the two parcels of land
subject of the execution sale in question.

The dispositive portion of said
decision reads:

“WHEREFORE, having found no merit in the appeal, WE SET ASIDE
the judgment a quo, and enter a new one –

“1]          declaring
the plaintiffs?appellants as the actual owners of the two parcels of land
described in paragraph 2 of their complaint in consequence of their purchase
thereof at public auction;

“2]          ordering
defendant-appellee Timoteo Magno to surrender to plaintiffs Transfer Certificate of
Title Nos. 112470 and 119446;

“3]          ordering
defendant-appellee to deliver possession of the lands
to plaintiffs-appellants.”^[8]

Hence, this petition.

We reverse.  Contrary to
respondent appellate court’s supposition, petitioner was not a judgment debtor
under the terms of the August 6, 1971
decision in CAR Case No. 2121-P’71.  The
phraseology of the amicable settlement leaves much to be desired, but judging
from the nature of the case, which was for the fixing of rentals, what was
decreed therein was the amount of rents to be paid thereafter by petitioner to
private respondents (pars. 1 & 3). 
No back rentals were adjudged against petitioner as the parties
“agreed to forego any and all claims and counterclaims which each has
against the other” (par. 4), except the termination of petitioner’s
employment as a hired laborer with respect to the 1/2 western portion of the
landholding and the payment of his wages in the amount of P70.00 (par. 2),
which undertaking appeared to have been effected and carried out.  As things stood, nothing was due from one
party to the other, there was nothing in the decision to execute for or against
either of the parties and thus, there was neither a judgment creditor nor a
judgment debtor.  The decision in CAR
Case No. 2121-P’71 merely laid down the terms and conditions that would govern
the future relationship and dealings between the parties.  Thus, it has been held that where the
decision of the appellate court “did not order the
appellant to do anything for or to pay any
amount to the appellee, but
merely specified the
nature of the contract between the parties and defined their rights thereunder, there nothing to be executed under such decision, and it was error for the lower court to direct appellee to ask for execution thereof.”^[9]

That petitioner agreed to
the amount of rentals stated in the amicable settlement did not thereby make
him a judgment debtor, as he did not likewise agree to have judgment executed
against him in case he defaults in the payment thereof.  When petitioner agreed to pay the stipulated
amount, what was created was a right
of action in favor of private respondents in case of default, which must
however be enforced by filing the corresponding complaint in court and not
through an application for an alias writ of execution in CAR Case No. 2121-P’71, particularly since there was no proviso in said decision with respect
to future default of petitioner.

As earlier stated, the
covenant between the parties as embodied in the amicable settlement in question
covered only the amount of rentals.  It
did not extend to the manner of enforcement of said obligation.  This being the case, the alias writ of
execution issued in CAR Case No. 2121-P’71 is null and void for lack of any
legal basis, exceeding as it does the tenor of the decision in said case.  A Writ of execution not warranted by the
decision or judgment which gives it life or cause to exist has no validity.^[10]

Another important factor which vitiates the proceedings leading
to the issuance of the alias writ of
execution is that the procedural short-cut employed by private respondents
deprived petitioner of his right to due process.  The application for the alias writ of
execution being ex-parte, no opportunity was
accorded the petitioner to air
his side and present his defense, if any. 
The degree of prejudice caused to petitioner becomes more apparent when
we consider Section 2 of P.D. No. 816 (1975) which provides:

“Section 2.  That any
agricultural lessee of a rice or corn
land under Presidential Decree No. 27 who deliberately refuses and/or continues
to refuse to pay the rentals or amortization payments when they fall due for a
period of two (2) years shall, upon hearing and final judgment, forfeit the
Certificate of Land Transfer issued in his favor, if his farmholding
is already covered by such Certificate of Land Transfer, and his farmholding;”

Since the deliberate refusal of the
agricultural lessee to pay the rentals for a period of two (2) years carries
with it the grave penalty of forfeiture of the landholding, it is imperative
under the law that every opportunity must be given the lessee to be heard on
his side of the controversy relating to the non-payment of rentals.  And certainly, the procedure followed by
private respondents falls short of this mandate.

The private respondents themselves must have realized the untenability of merely applying for a writ of execution in
CAR Case No. 2121-P’71 for the purpose of recovering unpaid rentals from
petitioner, for with respect to the unpaid rentals for the years 1981-1982,
they filed a complaint against petitioner before the RTC of Pangasinan
(Agrarian Case No. 137-UP’82) for said rentals’ collection, which case likewise
ended in a compromise agreement dated April 22, 1983.

The subject alias writ of execution being null and void, it follows that the proceedings had
thereon, the levy and sale, are likewise null and void and of no effect
whatsoever.

WHEREFORE, the Decision of the Court of Appeals in CA-G.R.
CV No. 07742 is hereby set aside, and judgment of the Regional Trial Court of Pangasinan, Branch XLV in Urdaneta,
dated June 26, 1985 is
hereby reinstated.  No costs.

 SO ORDERED.

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

^[1]
Penned by Justice Serafin E. Camilon
and concurred in by Justices Ricardo L. Pronove, Jr.
and Bonifacio A. Cacdac,
Jr.

^[2]
RTC Decision, Annex “C”,
Petition, pp. 20-21, Rollo

^[3]
pp. 14-15, Rollo

^[4]
Civil Case No. U-3865, Annex
“A”, Petition, pp. 11-13, Rollo

^[5]
pp. 23-24, Rollo

^[6]
p. 24, Rollo

^[7]
pp. 24-25, Rollo

^[8]
pp. 33-34, Rollo

^[9]
Capalungan v. Medrano, No. L-13783, May 18,
1960, 108 Phil. 22
(Underscoring ours.)

^[10]
Velez v. Martinez and Chacon, 63 Phil. 231