ARCADIO B.

DANDOY vs ZACARIAS TONGSON, (deceased) represented by his heirs

Facts:

On October 9, 1993, petitioner Arcadio dandoy filed the aforesaid action against
respondents Zacarias Tongson claiming that the Agricultural Leasehold Contracts dated January
23, 1976, executed between them and respondents, are null and void since at that time, the land
subject of the contracts is still public land, and respondents took advantage of their poverty and
ignorance and were made to believe that the property is already titled in respondents’ name.

According to petitioners, when they discovered that it is still public land, they filed free
patent applications. They also alleged that they never gave any share of the crops to respondents.
Instead of filing an answer, respondents filed a motion to dismiss the complaint on grounds of
lack of cause of action, prescription, lack of jurisdiction over the nature of the action, and litis
pendentia.

Respondent Zacarias Tongson claimed that he and his wife Encarnacion by virtue of a
document entitled “Transfer of Sales Rights” executed on June 9, 1952, acquired the rights over
the property from Magdalena Apa, which document was registered with the Bureau of Lands on
June 16, 1952. Despite said transfer, the Apas continued occupying the property and giving to
respondents a one-third share of the harvest. A certain Nestor Cabañero took over after the
Apas, and in 1968, Cabañero invited his brother-in-law, herein petitioner Arcadio Dandoy, to
work with him on the land. After Cabañero died, Dandoy, in turn, invited petitioner Ricardo
Maglangit to work with him. They kept the usual arrangement with the Apas that one-third share
of the harvest is given to the Tongsons. When Presidential Decree (P.D.) No. 27 was enacted,
petitioners started paying 25% of the harvest, with Dandoy paying an annual lease rental of 18.5
cavans of palay and Maglangit 9.5 cavans. Respondents contend that petitioners entered into the
leasehold contract freely and voluntarily. It was in 1977 that petitioners stopped paying lease
rentals to the Tongsons.

RTC denied the motion to dismiss. Particularly with regard to the issue of jurisdiction,
the trial court ruled that the Department of Agrarian Reform (DAR) has no jurisdiction over the
case since the parties are not related as landlord and tenant, and the contracts were “fictitious”
documents, which render it null and void.

C.A. reversed and said the case was vested with the Department of Agrarian Reform
Adjudication Board (DARAB), and not the RTC. Because:

Simply put, at the time this suit was filed in 1993, the subject property is already covered
by the CARP. Correspondingly, dispute on the existence of agricultural tenancy relationship
between the parties is solely vested with the agrarian department. It is now settled that with the
advent of Executive Order No. 229 and the Comprehensive Agrarian Reform Law on June 14,
1988, the Regional Trial Courts have been divested of jurisdiction to try agrarian cases, now
lodged exclusively with the DAR.
Issue: WON the complaint for declaration of nullity and inexistence of agricultural leasehold
contracts and tenancy relationship between the parties automatically make the nature of the
action agrarian in nature which calls for the application of the Agricultural Tenancy Act and
assumption of jurisdiction of the Department of Agrarian Reform Adjudication Board (DARAB)

Ruling: No

Rationale:

It is settled that jurisdiction over the subject matter on the existence of the action is
determined by the material allegations of the complaint and the law, irrespective of whether or
not the plaintiff is entitled to recover all or some of the claims or reliefs sought therein.[12] Such
jurisdiction cannot be made to depend upon the defenses set up in the court or upon a motion to
dismiss for, otherwise, the question of jurisdiction would depend almost entirely on the
defendant.[13] Once jurisdiction is vested, the same is retained up to the end of the litigation.
[14]

In this case, the CA was correct in holding that jurisdiction is determined by the law at
the time of the filing of the complaint. However, it was an error for the CA to rule that it is the
DARAB that has jurisdiction over the case. Under Rule II, Section 1 of the Revised Rules of
Procedure of the DARAB, the DARAB has primary jurisdiction, both original and appellate, to
determine and adjudicate all agrarian disputes, cases, controversies, and matters or incidents
involving the implementation of the Comprehensive Agrarian Reform Program (CARP) under
Republic Act (R.A.) No. 6657, Executive Order Nos. 229, 228, and 129-A, R.A. No. 3844, as
amended by R.A. No. 6389, P.D. No. 27, and other agrarian laws and their implementing rules
and regulations.

The CA erroneously applied Section 1 (c), Rule II of the Revised Rules of Procedure of
the DARAB, as this is limited only to cases involving the annulment or cancellation of lease
contracts or deeds of sale or their amendments involving lands under the administration and
disposition of the DAR or Land Bank of the Philippines (LBP), i.e., those already acquired
for CARP purposes and distributed to qualified farmer-beneficiaries.[15] The property subject
of this petition is a public land not within the administration and disposition of the DAR or the
LBP. Hence, Section 1 (c) of Rule II is not applicable.

Furthermore, the fact that Lot No. 294 is an agricultural land does not ipso facto make it
an agrarian dispute within the jurisdiction of the DARAB.[16] For the present case to fall within
DARAB jurisdiction, there must exist a tenancy relationship between the parties. An allegation
that an agricultural tenant tilled the land in question does not make the case an agrarian dispute.
[17]

In order for a tenancy agreement to take hold over a dispute, it is necessary that the
following indispensable elements are established: 1) that the parties are the landowner and the
tenant or agricultural lessee; 2) that the subject matter of the relationship is an agricultural land;
3) that there is consent between the parties to the relationship; 4) that the purpose of the
relationship is to bring about agricultural production; 5) that there is personal cultivation on the
part of the tenant or agricultural lessee; and 6) that the harvest is shared between the landowner
and the tenant or agricultural lessee.[18] It is not enough that these requisites are alleged; these
requisites must be shown in order to divest the regular court of its jurisdiction in proceedings
lawfully began before it.[19]

The trial court’s declaration of the nullity of the Agricultural Leasehold Contracts is
further strengthened by the fact that the “Transfer of Sales Rights” does not bear the prior
approval of the then Secretary of Agriculture and Commerce, in violation of Section 29 of
Commonwealth Act No. 141 or the Public Land Act, which provides:

SEC. 29. After the cultivation of the land has been begun, the purchaser, with the approval of
the Secretary of Agriculture and Commerce, may convey or encumber his rights to any person,
corporation, or association legally qualified under this Act to purchase agricultural public lands,
provided such conveyance or encumbrance does not affect any right or interest of the
Government in the land: And provided, further, That the transferor is not delinquent in the
payment of any installment due and payable. Any sale and encumbrance made without the
previous approval of the Secretary of Agriculture and Commerce shall be null and void
and shall produce the effect of annulling the acquisition and reverting the property and all
rights thereto to the State, and all payments on the purchase price theretofore made to the
Government shall be forfeited. After the sale has been approved, the vendor shall not lose his
right to acquire agricultural public lands under the provisions of this Act, provided he has the
necessary qualifications. (Emphasis supplied)
Domingo Suarez vs Leo Saul

Facts:

Petitioner Domingo C. Suarez owns a 23-hectare agricultural land in Sitio Spring,

Poblacion T’boli, South Cotabato. Respondents filed a complaint for reinstatement with
preliminary mandatory injunction, recovery of possession and damages against petitioner and
T’boli Agro-Industrial Development (TADI) before the Office of the Provincial Adjudicator,
Department of Agrarian Reform Adjudicatory Board (DARAB).

Respondents alleged that they were agricultural tenants in petitioner’s land on a 25-75
sharing agreement; that after two croppings, petitioner voluntarily offered the land for sale to the
government under a Voluntary Offer to Sell (VOS) dated February 20, 1993; that they signed the
documents for the transfer of the land under the Comprehensive Agrarian Reform Program
(CARP) as farmer-beneficiaries, and petitioner, as landowner; and that the sale was approved by
the local Land Valuation Office of the Land Bank of the Philippines (LBP).

Respondents claimed that while the VOS was being processed, they were summarily
ejected from the property by TADI after the latter entered into a Grower Agreement with
Contract to Buy with petitioner thereby depriving them of their landholdings.

Petitioner filed an Answer contending that respondents were installed as tenants, not by
him, but by Wennie[5] Gonzaga of the Department of Agrarian Reform (DAR) in Koronadal,
South Cotabato. He admitted that he voluntarily offered his land for sale to the government
under the CARP but denied knowledge of the certification issued by the LBP. He denied the
existence of a grower’s contract between him and TADI over the subject land.[6]

For its part, TADI claimed that its grower’s contract with petitioner covered parcels of
land different from those being claimed by respondents.[7]

In due course, the Regional Adjudicator issued an Order[8] dated July 18, 1996
dismissing the complaint for lack of merit. The adjudicator found that respondents failed to
prove their alleged tenancy over petitioner’s land. While they were identified as potential farmer-
beneficiaries of the land subject of the VOS, they only have an “inchoate right” to the land since
its coverage under the CARP has yet to be completed.[9]

On appeal, the DARAB Central Office rendered a Decision[10] reversing the Regional
Adjudicator. It observed that petitioner admitted that respondents were his tenants. It further
held that:

... it is in fact immaterial whether the subject landholding is covered by the alleged grower’s
contract or not. What is clear in the instant case is the fact that herein appellants were illegally
ejected from their respective tenanted lands. If indeed the subject land is not covered by the
grower’s contract, if there’s any, the act of defendant-appellee TADI in ejecting the tenants-
appellants was beyond authority, hence, illegal. Assuming arguendo that the subject landholding
is truly covered in the said contract, the contracting parties are required under the law to respect
the tenurial rights of the tenants therein.

Petitioner elevated the matter to the Court of Appeals which rendered a Decision
affirming the DARAB.

Petitioner contends that there is no basis in holding that respondents were his tenants. He
denies having admitted that they were his tenants, and insists that there is no proof to prove the
existence of tenancy relations. He asserts that he did not eject respondents from their
landholdings by entering into a grower’s contract over the subject land with TADI.

Issue: WON respondents are bona fide agricultural tenants under the law

Ruling: No.

Rationale:

Indeed, there is nothing in the records to suggest that respondents were petitioner’s bona
fide tenants prior to their designation by the DAR as potential farmer-beneficiaries under the
CARP. There is no evidence to prove tenancy arrangement between petitioner and respondents
before the former’s voluntary offer to convey the land to the government.

In holding that respondents were bona fide tenants of petitioner, the DARAB and the
appellate court relied solely on the alleged admission in petitioner’s answer to the complaint

While petitioner admitted that respondents were tenants in the land, he qualified in
paragraph 2 of his answer that it was Wennie Gonzaga of the DAR who installed them as such.
Clearly, it was the DAR who placed respondents in actual possession of the land upon
petitioner’s offer to transfer the same to the government. Other than this supposed admission,
there is no evidence on record to prove the tenancy relations. Respondents did not substantiate
their claim with evidence to show that they were agricultural tenants in petitioner’s land. They
did not allege actual cultivation or specify the crop produced thereby. Neither did they mention
how much of the produce was delivered to petitioner or submit receipts to prove the purported
25-75 sharing of harvests. They did not state, much less prove, the circumstances of their
agreement with petitioner as to the alleged tenancy relationship. Thus, there is no basis to the
claim that they are agricultural tenants on the property.

In VHJ Construction and Development Corporation v. Court of Appeals, we held that a

tenancy relationship cannot be presumed.

There must be evidence to prove the tenancy relations such that all its indispensable
elements must be established, to wit: (1) the parties are the landowner and the tenant; (2) the
subject is agricultural land; (3) there is consent by the landowner; (4) the purpose is agricultural
production; (5) there is personal cultivation; and (6) there is sharing of the harvests. All these
requisites are necessary to create tenancy relationship, and the absence of one or more requisites
will not make the alleged tenant a de facto tenant.
 Thus, it was error for the appellate court to affirm DARAB’s conclusion that it is
“immaterial whether the subject landholding is covered by the alleged grower’s contract or not.”
It is, in every sense, material to the determination of the case because petitioner is sought to be
held liable for respondents’ ejectment due allegedly to the contract. If the disputed land is not
the subject of the contract, as in fact it is not, then respondents cannot claim that petitioner
illegally ejected them from the land. Consequently, they have no cause of action against
petitioner, since the latter did not commit any act that resulted in their dispossession.

In order for a dispute to fall under the jurisdiction of the DARAB, the controversy must
relate to “tenurial arrangements, whether leasehold, tenancy, stewardship or otherwise, over
lands devoted to agriculture, including disputes concerning farmworkers associations or
representation of persons in negotiating, fixing, maintaining, changing or seeking to arrange
terms or conditions of such tenurial arrangements.”[29] There must be a tenancy relationship
between the party litigants for the DARAB to validly take cognizance of a controversy.[30]

In this case, there is no showing that there exists a tenancy relationship between
petitioner and respondents. Likewise, respondents have no tenancy relationship with TADI,
against whom they principally have a cause of action. The controversy is civil in nature since it
involves the issue of material possession, independent of any question pertaining to agricultural
tenancy. Hence, the case falls outside the jurisdiction of DARAB; it is cognizable by the regular
courts.

Though the parties do not challenge DARAB’s jurisdiction, the Court may motu proprio
consider the issue of jurisdiction. The Court has discretion to determine whether DARAB validly
acquired jurisdiction over the case since jurisdiction over the subject matter is conferred only by
law.[32] Jurisdiction over the subject matter cannot be acquired through, or waived by, any act or
omission of the parties. Neither would the active participation of the parties nor estoppel operate
to confer jurisdiction on the DARAB where the latter has none over a cause of action.
SPOUSES TITUS L. ENDAYA et al vs Court of Appeals

Facts:

The Spouses Natividad Trinidad and Cesar San Diego owned a piece of agricultural land
consisting of 20,200 square meters situated at San Pioquinto, Malvar, Batangas, devoted to rice
and corn. As far back as 1934, private respondent Pedro Fideli has been cultivating this land as a
tenant of the Spouses respondent Pedro Fideli has been cultivating this land as a tenant of the
Spouses San Diego under a fifty-fifty (50-50) sharing agreement.

On May 2, 1974, a lease contract was executed between the Spouses San Diego and one
Regino Cassanova for a period of four years from May 1974 up to May 1978. The lease contract
obliged Cassanova to pay P400.00 per hectare per annum and gave him the authority to oversee
the planting of crops on the land. Private respondent signed this lease contract as one of two
witnesses.

The lease contract was subsequently renewed to last until May 1980 but the rental was raised to
P600.00. Again, private respondent signed the contract as witness.

During the entire duration of the lease contract between the Spouses San Diego and Cassanova,
private respondent continuously cultivated the land, sharing equally with Cassanova the net
produce of the harvests.

the Spouses San Diego sold the land to petitioners for the sum of P26,000.00. The sale was
registered with the Register of Deeds of Batangas and a Transfer Certificate of Title was duly
issued.

Private respondent continued to farm the land although petitioners claim that private respondent
was told immediately after the sale to vacate the land. 8 In any case, it is undisputed that private
respondent deposited with the Luzon Development Bank an amount of about P8,000.00 as partial
payment of the landowner's share in the harvest for the years 1980 until 1985.

Due to petitioners persistent demand for private respondent to vacate the land, private respondent
filed a complaint with the Regional Trial Court of Tanauan, Batangas praying that he be declared
the agricultural tenant of petitioners.

After trial, the trial court decided in favor of petitioners by holding that private respondent is not
an agricultural lessee of the land now owned by petitioners. Court of Appeals reversed the RTC
decision and declared private respondent to be the agricultural lessee of the subject landholding.

Petitioners aver that when the original landowners entered into a lease contract with Regino
Cassanova, the agricultural leasehold relationship between the original owners and private
respondent was thereby terminated.

Petitioners argue that a landowner cannot have a civil law lease contract with one person and at
the same time have an agricultural leasehold agreement with another over the same land. It is
further argued that because private respondent consented to the lease contract between the
Spouses San Diego and Cassanova, signing as he did the lease agreement and the renewal
contract as witness thereof, private respondent has waived his rights as an agricultural lessee.

Issue: WON the agricultural leasehold relationship between original owners and Pedro Fideli
was already terminated.

Ruling: No, the agricultural relationship was not terminated.

Rationale:

R.A. No. 3844 (1963), as amended By R.A. No. 6839 (1971), which is the relevant law
governing the events at hand, abolished share tenancy throughout the Philippines from 1971 and
established the agricultural leasehold system by operation of law. Section 7 of the said law gave
agricultural lessees security of tenure by providing the following: "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." The fact that the landowner entered into a
civil lease contract over the subject landholding and gave the lessee the authority to oversee the
farming of the land, as was done in this case, is not among the causes provided by law for the
extinguishment of the agricultural leasehold relation. On the contrary, Section 10 of the law
provides:

Sec. 10. Agricultural Leasehold Relation Not Extinguished by Expiration of Period, etc. — The
agricultural leasehold relation under this code shall not be extinguished by mere expiration of the
term or period in a leasehold contract nor by the sale, alienation or transfer of the legal
possession of the landholding. In case the agricultural lessor sells, alienates or transfers the legal
possession of the landholding, the purchaser or transferee thereof shall be subrogated to the
rights and substituted to the obligations of the agricultural lessor.

Hence, transactions involving the agricultural land over which an agricultural leasehold subsists
resulting in change of ownership, e.g., sale, or transfer of legal possession, such as lease, will not
terminate the right of the agricultural lessee who is given protection by the law by making such
rights enforceable against the transferee or the landowner's successor in interest.

In the instant case, private respondent has been cultivating the subject farm landholding with a
fifty-fifty (50-50) sharing arrangement with the Spouses San Diego, petitioners' predecessors-in-
interest. The passage of R.A. 6839 in 1971, amending R.A. 3844 (1963), secured to private
respondent all the rights pertaining to an agricultural lessee. The execution of a lease agreement
between the Spouses San Diego and Regino Cassanova in 1974 did not terminate private
respondent's status as an agricultural lessee. The fact that private respondent knew of, and
consented to, the said lease contract by signing as witness to the agreement may not be construed
as a waiver of his rights as an agricultural lessee. On the contrary, it was his right to know about
the lease contract since, as a result of the agreement, he had to deal with a new person instead of
with the owners directly as he used to. No provision may be found in the lease contract and the
renewal contract even intimating that private respondent has waived his rights as an agricultural
lessee. Militating against petitioners' theory that the agricultural leasehold was terminated or
waived upon the execution of the lease agreement between the San Diegos and Cassanova is the
fact the latter desisted from personally cultivating the land but left it to private respondent to
undertake the farming, the produce of the land being shared between Cassanova and private
respondent, while the former paid P400.00 and later P600.00 per hectare per annum to the San
Diegos, as agreed upon in the lease contract.

Petitioners, however, insist that private respondent can no longer be considered the agricultural
lessee of their farm land because after they purchased the land from the Spouses San Diego in
1980, private respondent did not secure their permission to cultivate the land as agricultural
lessee. ---OTHER CONTENTION

It is true that the Court has ruled that agricultural tenancy is not created where the consent the
true and lawful owners is absent. But this doctrine contemplates a situation where an untenanted
farm land is cultivated without the landowner's knowledge or against her will or although
permission to work on the farm was given, there was no intention to constitute the worker as the
agricultural lessee of the farm land. The rule finds no application in the case at bar where the
petitioners are successors-in-interest to a tenanted land over which an agricultural leasehold has
long been established. The consent given by the original owners to constitute private respondent
as the agricultural lessee of the subject landholding binds private respondents whom as
successors-in-interest of the Spouses San Diego, step into the latter's shows, acquiring not only
their rights but also their obligations.

The Court, however, notes from the records of the case that private respondent has unilaterally
decided to pay only 25% of the net harvests to petitioners. 24 Since the agreement of private
respondent with the Spouses San Diego, the original owners, was for a fifty-fifty (50-50) sharing
of the net produce of the land, the same sharing agreement should be maintained between
petitioners and private respondents, without prejudice to a renegotiation of the terms of the
leasehold agreement.