HOSPICIO NILO vs.

COURT OF APPEALS and ALMARIO GATCHALIAN

G.R. No. L-34586 April 2, 1984

FACTS:
Respondent Almario Gatchalian is the owner of a parcel of riceland at Barrio San Roque, San
Rafael, Bulacan with an area of two (2) hectares covered by Transfer Certificate of Title No.
T-76791 of the Registry of Deeds of Bulacan. Petitioner Hospicio Nilo has been the
agricultural share-tenant of Gatchalian since agricultural year 1964-65.
On February 22, 1967, petitioner filed a petition in C.A.R. Case No. 1676 with the
Court of Agrarian Relations electing the leasehold system. On March 7, 1968, Gatchalian
flied an ejectment suit against petitioner on the ground of personal cultivation under Sec. 36
(1) of Republic Act No. 3844
Nilo alleged by way of affirmative defense that the ejectment suit was but an act of reprisal
and retaliation because he elected the leasehold system,
The Court of Agrarian Relations found that there was a bona fide intention to
cultivate the land personally. The petitioner appealed to the respondent Court of Appeals
which affirmed the decision of the Court of Agrarian Relations. The Court found no
justification to unduly interfere with the desire of Gatchalian to personally cultivate his own
land.
The petitioner filed a motion for reconsideration contending that "personal
cultivation as a ground for ejectment of an agricultural lessee has been eliminated under
Republic Act No. 6389". The latter law which took effect on September 10, 1971
The respondent Court of Appeals denied the motion resolving that Republic Act No. 6389 has
no retroactive application.

ISSUE:
Whether or not the amendment in R.A. 6389 should be given retroactive effect to
cover cases that were filed during the effectivity of the repealed provision.

HELD:
Laws shall not have a retroactive effect unless therein otherwise provided.
(Article 3 of the old Civil Code ,now Article 4 of the New Civil Code)

That it was the intention of the legislature in amending paragraph (1), sec. 36 of
R.A. 3844 to deprive the landowner of the right to eject his tenant on the ground that the
former would personally cultivate the land and also to abate cases brought by the landowner
to eject the tenant on the same grounds which were still pending at the time of the passage
of the amendatory act, is clear and evident from the deliberations and debate of Congress
when Republic Act 6389 was being deliberated, as published in the Senate Journal ....
the massive overhaul of the system of land ownership by the transfer to the tenants of the
ownership of the land they till and the grant to them of the instruments and mechanisms to
increase their land's productivity will decisively improve the people's livelihood and promote
political and social stability.

Section 12 of Article XIV specifically mandates that "the State shall formulate and
implement an agrarian reform program aimed at emancipating the tenant from the bondage
of the soil and achieving the goals enunciated in this Constitution." At any rate, there is no
need to pass upon the constitutional issue for the purpose of resolving the narrow question of
retroactivity of the questioned provision.

The petition is denied for lack of merit.

Baltazar vs. CA, G.R. No. L-40191

FACTS:
In 1969, private respondent bought two parcels of riceland having an aggregate area of 3.2
hectares. On the ground of converting the same into a residential subdivision, she filed, that
same year, a complaint for ejectment of petitioner, the agricultural lessee and share tenant of
the properties since 1912. Petitioner claimed that the former landowner, in violation of
sections 11 and 13 of the Code of Agrarian Reforms (R.A. 3844 which took effect in 1963
until amended by R.A. 6839 in 1971) sold the properties without giving him notice, and
registered the sale without the required Affidavit to the effect that the notice requirement had

been complied with. By way of counter-claim, petitioner, in the exercise of his right of
redemption, tendered and deposited P5,000.00 with the Agrarian Court to cover the purchase
price of P4,608.32 paid by private respondent to the former owner. In a decision dated
August 20, 1970, the Agrarian Court upheld petitioner's right of redemption and ordered
private respondent to convey the properties to him. On appeal to the Court of Appeals,
however, the complaint for ejectment was dismissed based on the status quo provision of
Presidential Decrees Nos. 27 and 316 which were both issued during the pendency of the
appeal. Hence, this petition. Petitioner now seeks a review of CA decision dismissing the
ejectment suit against a tenant filed by a landowner who wanted to convert her land into a
residential subdivision, but denying to the tenant the right of redemption, premised upon the
retroactive application of Presidential Decrees Nos. 27 and 316.
ISSUE:
W/N the CA erred in according retroactive application to Presidential Decrees Nos. 27 and
316.
RULING:
YES. It will thus be seen that the action was instituted on 24 December 1969, long before
Presidential Decrees Nos. 27 and 316 took effect on 21 October 1972 and 22 October 1973,
respectively. Decision was rendered by the trial Court on 20 August 1970, also prior to the
effectivity of said decrees. The case had been pending before the Court of Appeals since
1970, again prior to the promulgation of said Decrees, although its Decision was rendered
after their enactment. There being no express nor clearly implied authorization embodied in
PD Nos. 27 and 316 allowing retrospective application, prospective construction is called for.
But even if applied retroactively, PD Nos. 27 and 316 will find no application considering
that ejectment proceedings herein were not filed to harass the tenant but to convert the land
into a subdivision, a reason perfectly valid under the laws then in force. It is Republic Act
No. 3844, which took effect on 22 August 1963, prior to its amendment by Republic Act No.
6839 on 10 September 1971, that should govern the relationship between the contending
parties and which should determine whether or not the trial Court's findings that petitioner
had properly exercised his right of redemption is correct. Private respondent herself failed
to give the required notice under section 36 (1) of the same Code prior to the filing of
ejectment proceedings. Considering that petitioner could not exercise his right of
preemption for lack of notice and the sale was consummated, he must be held to be entitled
to the lawful exercise of his right of redemption allowed under Section 12 of the same Code.
Harmonizing the foregoing provision together with section 36,supra, even if a landowner
desires to convert under section 14, a lessee possesses the right to be secured in his tenure
until a just cause for his dispossession is proved and his ejectment is authorized by the
Court. The right of a lessee to pre-empt or redeem a landholding cannot be exercised if the
owner bought or holds the land for residential purposes. However, the limitation to the
lessee's right to pre-empt or redeem is conditioned upon the fulfillment by the landowner of
the following requisites: (1) that the property is suitably located; (2) that the conversion be in
good faith; and (3) that the conversion is substantially carried out within one year from the
date of sale. 9 These conditions must concur, otherwise, the land is subject to redemption by
a tenant. The trial Court found that the foregoing requisites had not been fulfilled by private

respondent. The latter had not proven suitability. Petitioner was admittedly the agricultural
lessee of the lands from which he was being sought to be ejected. Private respondent had no
approved plan of subdivision. She did not have the approval of the proper authorities to
convert the properties into a subdivision, nor had the construction been readied. 10 The trial
Court also found that there was some measure of bad faith on the part of private respondent
in seeking the dispossession of petitioner, and that no substantial conversion had been
undertaken by private respondents. The Supreme Court held, that Presidential Decrees
Nos. 27 and 316 may not be applied retroactively, so that petitioner, who is entitled to the
right of pre-emption and redemption under the provisions of R.A. 3844, the law then in force,
had validly exercised his right to redeem, his right of preemption not having been made
available to him due to lack of notice of the sale. Decision of the Court of Appeals set aside
and decision of the Court of Agrarian Relations affirmed.

HIDALGO V HIDALGO
L-25326; May 29, 1970
J. Teehankee, ponente
PETITION for review from decisions of Court of Agrarian Relations
DOCTRINE: Where the true intent of the law is clear, such intent or spirit must prevail
over the letter thereof. Whatever is within the spirit of a statue is within the statute, since
adherence to the letter would result in absurdity, injustice, and contradictions and would
defeat the plain and vital purpose of the statute.
FACTS:
Case jointly decided two petitions for review of decisions with the same issue
involving the same landowners and vendees which dismissed petitioners actions
as share tenants for the enforcement of the right to redeem agricultural lands.
Petitioners have been working on the lands as share tenants for several years.
1. First case: respondent-vendor Policarpio Hidalgo owned lands and sold it
with two other parcels of land for 4,000. Igmidio Hidalgo and Martina
Rosales as tenants alleged that the area of land they worked on is worth
1, 500 and thus they seek the execution of a deed of sale for the same
amount by respondents-vendee in their favor by way of redemption.
2. Second case: parcel of land worth 750 was sold by respondent. Petitionerspouses Hilario Aguila and Adela Hidalgo sought the execution of a deed
of sale for the same price by way of redemption.
Sec12 of the Land Reform Code or RA 3844 is available to leasehold tenants
only but not to share tenants. It provides that:
Lessees Right of RedemptionIn case the landholding is sold to a third
person without the knowledge of agricultural lessee, the latter shall have
the right to redeem the same at a reasonable price and consideration.;

Provided: further, that where there are two or more agricultural lessees,
each shall be entitled to said right of redemption only to the extent of the
area actually cultivated by him. The right of redemption under this Section
may be exercised within two years from the registration of the sale, and
shall have the priority over any right of legal redemption.
No 90-day notice of intention to sell the lands for the exercise of the pre-emption
prescribed by Sex11 of the Agricultural Land Reform was given
ISSUE: WON the right of redemption granted by Sec12 of RA 3844 is applicable to
share tenants also. Or, WON the plaintiffs, as share tenants are entitled to redeem the
parcel of land they are working from the purchasers thereof where no notice was
previously given to them by the vendor, who was their landholder, of the latters intention
to sell their property and where the vendor did not execute the affidavit required by
Sec13 of RA 3844 before the registration of the deed of sale.
RATIO:
The agrarian court erred in dismissing the petition on the basis of its conclusion that the
right of redemption granted by Sec12 of Land Reform Code is available to leasehold
tenants only and not shares tenants and that their respective rights and obligations
are not coextensive or coequal.
The very essence of Agricultural Land Reform Code is the abolition of agricultural
share tenancy. It was error of the agrarian court to state that the systems of
agricultural tenancy recognized in this jurisdiction are share tenancy and
leasehold tenancy even after the enactment of the Land Reform Code.
The difference between share and leasehold tenancy as premised in the agrarian
courts decision refers to the contractual relationship between the tenant and the
landowner, but the Land Reform Code forges by operation of law a vinculum juris
(civil obligation)whether for a leasehold tenant or temporarily a share tenant.
Juridical consequences coming from thus are security of tenure of the tenant and
the tenants right to continue in possession of the land he works despite the
expiration of the contract or the sale or transfer of the land to third persons, and
the farmers pre-emptive right to buy the land he cultivates as well as the right to
redeem the land if sold to a third person without his knowledge.
The Code did not mention tenants, whether leaseholds or share tenants,
because it outlaws share tenancy and envisions the agricultural leasehold
system as its replacement, and the agrarian courts literal construction would
wreak havoc on and defeat the proclaimed and announced legislative intent and
policy of the State of establishing owner-cultivatorship for the farmers who
invariable were all share tenants before the enactment of the Code and whom
the Code would now uplift to the status of the lessees.
Where the true intent of the law is clear, such intent or spirit must prevail over the
letter thereof. Whatever is within the spirit of a statue is within the statute, since
adherence to the letter would result in absurdity, injustice, and contradictions and
would defeat the plain and vital purpose of the statute.

 Basbas v Entena is not applicable, as there, the tenant-redemptioner was shown

by the evidence to have no funds and had merely applied for them to the Land
Authority which was not yet operating in the locality and hence, the Court held
that no part of the Code indicates or even hints that the 2-year redemption
period will not commence to run until the tenant obtains financing from the Land
Bank, or stops the tenant from securing redemption funds from some other
source. In the present case, the sole legal issue is the right of redemption being
available to the redemption of the share tenants.
The historical background for the enactment of the Codes provisions on preemption and redemption further strengthens the Courts opinion
RULING: Decisions appealed are REVERSED, petitions to redeem the subject
landholdings are GRANTED.

G.R. No. L-29381

September 30, 1969

PHILIPPINE NATIONAL RAILWAYS and PANTALEON BINGABING,

vs. HON. VALERIANO A. DEL VALLE, in his capacity as Presiding Judge, Court of
Agrarian Relations and PAMPILO DOLTZ,

The decisive issue to be resolved in this case is whether or not strips of land
owned by Philippine National Railways (PNR) which are on both sides of its railroad
track, and are part of its right of way for its railroad operations but temporarily leased,
are agricultural lands within the purview of the Agricultural Tenancy Act and the
Agricultural Land Reform Code, such as would come within the jurisdiction of the Court
of Agrarian Relations.
The facts of this particular case are these:
PNR, a government-owned corporation, is the registered owner of three (3) strips
of land with a uniform width of 30. meters adjoining one another longitudinally, the same
being part of its railroad right of way running from Manila to Legazpi. These strips of
land lie within the municipalities of Oas and Polangui, Province of Albay. At the center
thereof is a track measuring ten (10) to twelve (12) meters in width where railroad ties
are placed and rails built for running locomotives. On both sides of the track, or about
(2) to five (5) meters away from the embarassment of the track, are telegraph and
telephone posts office (50) meters apart from each other, which maintain
communication wires necessary in the operation of PNR trains. PNR draws earth from

these sides to fill up the railroad track whenever it is destroyed by water during rainy
days; and uses them as depository of railroad materials for the repair of destroyed lines,
posts, bridges during washouts, or other damaged parts of the line occasioned by
derailments or other calamities.
The portions of these lands not actually occupied by the railroad track had been a
source of trouble. People occupied them; they reap profits therefrom. Disputes among
those desiring to occupy them cropped up. It is on the face of all these that, with
adequate provisions to safeguard railroad operations, PNR adopted temporary rules
and regulations, as follows: (a) the possession and enjoyment of the property should be
awarded to interested persons thru competitive public bidding; (b) the rental of the
premises is to be determined from the amount offered by the highest bidder; (e) the
duration of the lease shall be for a limited period, not to exceed three (3) years; (d) the
lessee cannot sublease the premises; (e) the lease contract is revocable at any time
upon demand by the owner, whenever it needs the same for its own use or for a more
beneficial purpose; (f) the owner can enter the leased premises during the period of the
lease to make necessary repairs; and (g) the lessee shall not use the premises in a
manner prejudicial to the operation of the trains.
Sometime in 1963, PNR awarded the portions of the three strips of land
aforementioned which are on both sides of the track, after a competitive public bidding,
to petitioner Pantaleon Bingabing for a period of three (3) years and under conditions
hereinbefore set forth. A civil law lease contract in printed form was, on April 15, 1963,
entered into by and between PNR and Bingabing. That contract expressly stipulates
that Bingabing was "to occupy and use the property ... temporarily for agriculture."
Consideration therefor was P130.00 per annum. Bingabing, however, failed to take
possession because respondent Pampilo Doltz was occupying the land, had a house
thereon. Doltz claims to be a tenant of previous awardees, and later, of Bingabing
himself.
Sometime in March 1965, PNR and Bingabing filed suit against Doltz for recovery
of possession of the premises in the Court of First Instance of Albay. 1 They there
averred that sometime in January 1963, Doltz illegally entered the land, constructed a
house thereon occupying about fifty (50) square meters, and planted palay on the other
portions thereof. They prayed that Doltz remove his house, vacate the premises, restore
possession to PNR or Bingabing, pay PNR P160 per annum as reasonable
compensation for the occupation of the premises from January 1963, and P2,000 as
expenses of litigation, pay Bingabing P500 annually from 1963, and shoulder the costs
of suit.

Doltz' answer in that case averred inter alia that the had been a tenant on the
property for over twenty years; that he had been placed thereon by the deceased Pablo
Gomba who leased the property from the then Manila Railroad Company (now PNR);
that he became the tenant of Demetrio de Vera, Gomba's successor; that he is the
tenant of Bingabing, having given the latter's share of 1/3 during the last two harvests;
and that the case is properly cognizable by the Court of Agrarian Relations. Upon the
court's request, Doltz and Bingabing agreed to temporarily liquidate the harvest on a
sharing ratio of 70-30 in Doltz' favor.
It has been suggested in the record that said case Civil Case 3021 was
dismissed by the Court of First Instance of Albay upon the ground that the subject
matter of the action is tenancy; that petitioners have appealed. That case,
parenthetically, has not yet reached this Court.
While the aforesaid Civil Case 3021 was pending in the Albay court of first
instance, Doltz registered with the Court of Agrarian Relations (CAR) a petition against
Bingabing for security of tenure, the adoption of a sharing ratio of 70-30 of the crops,
and reliquidation of past harvests. This is the present case CAR Case 692, Albay '67,
Court of Agrarian Relations, Ninth Regional District, Legazpi City, Branch II, entitled
"Pampilo Doltz, Petitioner, versus Pantaleon Bingabing, Respondent." PNR intervened
in the case. Petitioners herein there maintained the position that the premises in
controversy are not an agricultural land within the contemplation of the Agricultural
Tenancy Act (Republic Act 1199) or the Agricultural Land Reform Code (Republic Act
3844); that no tenancy relationship existed between the parties; that CAR, therefore,
lacked jurisdiction over the case; and that there is a pending case between the same
parties in another court involving the same subject matter and the same cause of action.
After trial, the CAR promulgated its decision of June 10, 1968. It upheld its
jurisdiction over the case, maintained Doltz in the peaceful possession of the parcels of
land as tenant on a 70-30 sharing ratio in Doltz' favor, ordered Bingabing to pay Doltz
P250 attorneys' fees and the costs, but dismissed the latter's claim for reliquidation of
past harvests for lack of substantial evidence. Petitioners' move to reconsider the said
decision failed. They now come to this Court. They specifically question CAR's
jurisdiction.
1. Is the land here involved in agricultural land within the meaning of the
Agricultural Tenancy Act and the Agricultural Land Reform Code?
According to Section 3 of the Agricultural Tenancy Act, "[a]gricultural tenancy is
the physical possession by a person of land devoted to agriculture belonging to, or
legally possessed by, another for the purpose of production through the labor of the

former and of the members of his immediate farm household, in consideration of which
the former agrees to share the harvest with the latter, or to pay a price certain or
ascertainable, either in produce or in money, or in both." 2 The term "agricultural land" as
understood by the Agricultural Land Reform Code is not as broad in meaning as it is
known in the constitutional sense. As interpreted in Krivenko vs. Register of Deeds, 79
Phil. 461, 471, the phrase "agricultural land," constitutionally speaking, includes all
lands that are neither mineral nor timber lands and embraces within it wide sweep not
only lands strictly agricultural or devoted to cultivation for agricultural purposes but also
commercial, industrial, residential lands and lands for other purposes. On the other
hand, by Section 166(1) of the Agricultural Land Reform Code, " "[a]gricultural land"
means land devoted to any growth including but not limited to crop lands, salt beds,
fishponds, idle land and abandoned land as defined in paragraphs 18 and 19 of this
section, respectively." 3
It is obvious then that under the law, the land here in controversy does not fit into
the concept of agricultural land. PNR cannot devote it to agriculture because by its own
charter, Republic Act 4156, PNR cannot engage in agriculture.
Indeed, the land which adjoins the railroad track on both sides is part of
PNR's right of way. That right of way is not limited to the particular space occupied by
the roadbed or its main track. It also includes the portions occupied by the telephone
and telegraph posts. It extends to a width of 30 meters which reasonably gives the train
locomotive engineer a clear commanding view of the track and its switches ahead of
him.
The entire width is important to PNR's railroad operations. Which should not be
hampered. And, communication lines must not be disturbed. Buildings should not be
constructed so close to the track. Because, it is not so easy to prevent people from
walking along the track; animals, too, may stray into the area; obstructions there could
be along the track itself which might cause derailment. All of these could prevent the
locomotive engineer from taking the necessary precautions on time to avert accidents
which may cause damage to the trains, injury to its passengers, and even loss of life.
Besides, the use of the strips of land on both sides of the track in railroad
operation is inconsistent with agricultural activities. The contract of lease authorizes the
railroad company to enter upon the premises to make repairs, place its materials on the
land. It may even take soil from the land to fill up any part of the railroad track destroyed
by water during rainy days. What if PNR should decide to construct another parallel
track on the land leased? The occupant of the land cannot prevent or stop PNR from
doing any of these. Security of tenure so important in landlord-tenant relationship may
not thus be attained.

The foregoing are considerations sufficient enough to deter us from adopting the
view that the disputed land in narrow strips is agricultural land within the meaning
of the Agricultural Tenancy Act and the Agricultural Land Reform Code. By destination, it
is not agricultural.
2. Nor may Pampilo Doltz be considered as a true and lawful tenant.
To be borne in mind is the fact that PNR executed with Pantaleon Bingabing a
civil law lease contract, not an agricultural lease.1awphl.nt This distinction is expressly
recognized by the law. 4 That contract is temporary, at best for a short term. It is
revocable any time upon demand by PNR whenever it needs the same for its own use
or for a more beneficial purpose.
Even on the assumption that the land is agricultural, there is the circumstance
that PNR prohibits the sublease of the premises. PNR's lessees cannot give what they
are not allowed to give. Any contract then of sublease between Doltz, the supposed
tenant, and Pablo Gomba or Demetrio de Vera, the previous awardees, or even of
Pantaleon Bingabing, the present awardee without PNR's consent cannot bind the
latter. No such consent was here given.
This ushers us to a principle shaped out by jurisprudence that the security of
tenure guaranteed by our tenancy law may be invoked only by tenants de jure, not by
those who are not true and lawful tenants. 5 In Pabustan vs. De Guzman, L-12898,
August 31, 1960, the tenant sublet the landholding to a third person without the
knowledge and consent of the landowner. In an ejectment suit brought by the landowner
against said third person in the CAR, this Court held that the CAR had no jurisdiction
over the case because no tenancy relationship existed between the parties, as the third
person was, in reality, an unlawful squatter or intruder. Correlating Pabustan to the
present case, the lessee here had no power to sublet. There is also thus no legally
cognizable relationship of tenancy between the parties.
We, accordingly, rule that CAR does not have jurisdiction over the case at bar and
the proceedings below are thus null and void.
For the reasons given, the judgment of the Court of Agrarian Relations of June
10, 1968 in its Case 692, Albay '67, under review is hereby reversed, and said case is
hereby dismissed.
Costs against private respondent Pampilo Doltz. So ordered.