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[ G.R. No. 123327. July 19, 1999]
AIDA CRUZ, et al. vs. CA, et al.
SECOND DIVISION
Gentlemen:
Quoted hereunder, for your information, is a resolution of this court dated JUL 19, 1999.
G.R. No. 123327 (Aida Cruz, Amado Lacanilao, Guadalupe Paraon, Arsenio Paraon, and Vicente Libunao vs. Court of Appeals, Rev. Anacleto C. Lipana and Marcelo C. Lipana.)
Petitioners Aida Cruz, Amando Lacanilao, Guadalupe Paraon, Arsenio Paraon, and Vicente Libunao are tenant-lessees of various parcels of land belonging to respondents Anacleto and Marcelo Lipana. Under separate leaseholds agreements, petitioners paid the following rentals to respondents: for the first harvest, Cruz - 30 cavans of palay, Lacanilao - 20 cavans of palay, Guadalupe Paraon - 33 cavans of palay, Arsenio Paraon - 17 cavans of palay, and Libunao - 30 cavans of palay; and for the second harvest, 20% of the gross harvests of each.
The landholdings eventually became subject of land reform under P.D. No. 27, which was promulgated on October 21, 1972.
On April 7, 1997, respondents filed an action for forfeiture of landholdings, cancellation of certificates of land transfer, and for collection of lease rentals against petitioners, docketed as Civil Case No. 175-M-87 in the Regional Trial Court (RTC) of Bulacan, Branch 7, on the ground the petitioner had not paid their rentals since 1985 despite demands.
In answer, petitioner alleged, among other things, that certificates of land transfer had been issued to them covering the lands they were cultivating; and that they had stopped paying rentals upon the advice of officials of the Department of Agrarian Reform, Team Office, San Miguel, Bulacan that they (petitioners) had already fully paid the purchase price.
After trial, the RTC rendered its decision, the dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered:
1. Ordering the defenfants to pay to the plaintiffs as follows:
Defendant Aida Cruz-Estrera - sixty (60) cavans of palay for the year 1985, and the same amount for each and every succeeding years [sic] thereafter that said defendant remains in possession of the landholdings being cultivated by her;
Defendant Arsenio Paraon - 34 cavans of palay for the year 1985 and the same amount for each every succeeding years [sic] thereafter that said defendant remains in possession of the landholding being cultivated by him;
Defendant Amado Lacanilao - 40 cavans of palay for the year 1985 and the same amount for each and every succeeding years [sic] thereafter that said defendant remains in possession of the landholding being cultivated by him;
Defendant Guadalupe Paraon - 60 cavans of palay for the year 1985 and the same amount for each and every succeeding years [sic] thereafter that said defendant remains in possession of the landholding being cultivated by her;
Defendant Vicente Libunao - 60 cavans of palay for the year 1985 and the same amount for each and every succeeding years [sic] thereafter that said defendant remains in possession of the landholding being cultivated by him.
2. Declaring as forfeited the Certificates of Land Transfer respectively issued to the above-named defendants in respect of the subject landholding[s], or, if no certificates of land transfer have been issued to them in regard of their respective landholdings, they are hereby declared to have lost their right to be grantees of said Certificates of Land Transfer;
3. Declaring the defendants to vacate their respective farm holdings in the subject property and to surrender possession thereof to the plaintiffs;
4. Ordering the defendants to vacate their respective farm holdings in the subject property and to surrender possession thereof to the plaintiffs;
5. Ordering the defendants, pro indiviso to pay the plaintiffs the sum of P5,000.00 as attorney's fees;
6. Ordering the defendants, pro indiviso to pay to the plaintiffs the costs of this suit.
SO ORDERED.
On appeal, the Court of Appeals affirmed. Hence this petition.
Petitioners contend that since they had become owners of the subject properties by virtue of the promulgation of P.D. No. 27 on October 21, 1972, they cannot be ejected; that they (petitioners) had already completed the payment of value of their farm holdings; that respondents' action was premature because the amount of just compensation to be paid for the taking of the farm holdings had yet to be determined through judicial action; and that since the case was an agrarian dispute, the RTC did not have jurisdiction.
On the other hand, respondents contend that they remain owners of the farm holdings until they are paid just compensation for such holdings. They allege that the valuation made by the Department of Agrarian Reform, which petitioners claimed they had already paid, was preliminary and was pending final determination by the Office of the President and that in the meantime petitioners should continue to pay rentals to them.
First. P.D. No. 816 provides in pertinent part:
WHEREAS, while the implementing rules and regulations of Presidential Decree No. 27 have not been issued completely, the status quo shall be maintained between the parties, that is, the landowner shall continue to pay the land taxes thereon if the said landholding is not yet covered by a Certificate of Land Transfer, while on the other hand, the tenant-farmer who is now called agricultural lessee shall continue to pay the rental to the landowner whether or not his landholding planted to rice and corn is already covered by a Certificate of Land Transfer;
WHEREAS, such payment of rental shall continue until and after the valuation of the property shall have been determined or agreed upon between the landowner and the Department of Agrarian Reform which, in turn, will become the basis for computing the amortization payment to be made by the agricultural lessee in 15 years with 6% interest per annum.
WHEREAS, it is known that despite the presidential pronouncements that they shall continue to pay rentals to the landowners/agricultural lessors, some agricultural lessees have stopped and refused to pay their leasehold rentals to their landowners/agricultural lessor on the assumption that, once the Certificate of Land Transfer are issued in their favor, they are no longer obliged to pay the said leasehold rentals.
. . .
SECTION 1. That the continuing and deliberate refusal of the agricultural refusal of the agricultural lessees to pay their leasehold rentals to the landowners/agricultural lessors cannot be countenanced and shall remain unchecked or unpunished;
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 farm holdings is already covered by such certificate of Land Transfer, and his farm holding.
In this case, petitioners themselves admit that the just compensation for the landholdings is still to be finally determined. Thus it is disingenuous for petitioners to insist that they no longer had to pay rentals as they had already completed payment for their farm holdings.
Petitioners claim that they stopped paying rentals because they were advised by the DAR office in San Miguel and Baliwag, Bulacan that they has in fact overpaid respondents. They have not, however, substantiated this claim. To the contrary, considering that repeated demands had been made on them by respondents to pay rentals petitioners should have obtained official confirmation of what they claim was the informal advice given to them by unnamed personnel of the DAR office in Bulacan.
Second. It is not true that under P.D. No. 27 petitioners were granted absolute ownership of the landholdings in question and that, therefore, they cannot be ejected therefrom. As held in Vinzons-Magana v. Estrella, 201 SCRA 536, 540-541 (1991):
It must be stressed, however, that the mere issuance of the certificate of land transfer does not vest in the farmer/grantee ownership of the land described therein. At most, the certificate merely evidences the government's recognition of the grantee as the party qualified to avail of the statutory mechanism for the acquisition of ownership of the land titled by him as provided under Presidential Decree No. 27. Neither is this recognition permanent nor irrevocable. Thus, failure on the part of the farmer/grantee to comply with his obligation to pay his lease rentals or amortization payments when they fall due for a period of two (2) years to the landowner or agricultural lessor is a ground for forfeiture of his certificate of land transfer (Section 2, P.D. No. 816; Pagtalunan v. Tamayo, G.R. No. 54281, March 19, 1990).
This Court has therefore clarified, that it is only compliance with the prescribed conditions which entitles the farmer/grantee to an emancipation patent by which he acquires the vested right of absolute ownership in the landholding-a right which has become fixed and established and is no longer open to doubt and controversy. At best the farmer/grantee prior to compliance with these conditions, merely possesses a contingent or expectant right of ownership over the landholding (Ibid.).
Both the trial and appellate courts found that petitioners had not paid their rentals for two years at the least. Under P.D. No. 816, non-payment of rentals for a period of two years is a ground for forfeiting the certificates of land transfer and of the farm holdings involved.
Third. Petitioners also contend that the regular courts had no jurisdiction to decide this case, since E.O. No. 229 granted quasi-judicial powers to the Department of Agrarian Reform over the cases involving agrarian reform matters. This contention has no merit as the action in this case was filed on April 7, 1987, prior to the effectivity of E.O. No. 229 on August 29, 1987. (See Quismundo v. Court of Appeals, 201 SCRA 609 [1991])
Considering the foregoing, the Court RESOLVED to DENY the petition for failure to establish that the Court of Appeals committed reversible error.
Very truly yours,
(Sgd.) TOMASITA M. DRIS
Clerk of Court
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