A N D O Y & R I C A R D O

ARCADIO B . D
V S  A U ST R I A -
MAGLANGI  R . , T I N G A ,
Z , C A L L E J O , S
MARTINE   JJ .
D C H I C O -N A Z A R I O ,
AN
S T O N G S O N
ZACARIA
 FACTS
•On October 9, 1993, petitioners filed the aforesaid action
against respondent. Petitioners claimed 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.
• In its Order dated December 22, 1993, the trial court
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.
• Thus, respondents filed their Answer. 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 Cabaero took over after the Apas, and
in 1968, Cabaero invited his brother-in-law, herein
petitioner Arcadio Dandoy, to work with him on the
land. After Cabaero 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. As affirmative defenses, respondents
reiterated the grounds set forth in their motion to
dismiss.
Issue:
• Whether the Regional Trial Court (RTC) of
Davao City, Branch 10, has jurisdiction over
petitioners action for Declaration of
Agricultural Leasehold Contract Void and
Inexistent, Damages, Attorneys Fees and
Preliminary Injunction with Temporary
Restraining Order.
 HELD
• Petitioners argue that it is the RTC that has jurisdiction over the case
on the ground that the case at bar is not an agrarian dispute but an
action incapable of pecuniary estimation.
• 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. 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. Once
jurisdiction is vested, the same is retained up to the end of the litigation.
• 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. 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. 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.
•  
• 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.[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.
•  
•  The element that the parties must be the landowner and the tenant
or agricultural lessee, on which all other requisites of the tenancy
agreement depends, is absent in this case. Tenancy relationship can
only be created with the consent of the true and lawful landholder
who is either the owner, lessee, usufructuary or legal possessor of the
land, and not thru the acts of the supposed landholder who has no
right to the land subject of the tenancy.
• The deed denominated as Transfer of Sales Rights executed by
Magdalena Apa in favor of Encarnacion Tongson merely conveyed
to Tongson the formers rights over the agricultural sales application
for Lot No. 294. It did not transfer any title or ownership over the
property, which Apa does not have.
• The sales application merely indicates that Apas legal possession of the land is
contingent upon her compliance with the requirements prescribed by law
before a final patent could be issued in her favor. Pending compliance, the
government still remained the owner thereof, as in fact the application could
still be canceled and the land awarded to another applicant should it be shown
that the legal requirements had not been complied with. What divests the
government of title to the land is the issuance of the sales patent and its
subsequent registration with the Register of Deeds. The registration and
issuance of the certificate of title segregate public lands from the mass of public
domain and convert it into private property.
•  The trial courts exercise of jurisdiction over the case and its pronouncement
that the Agricultural Leasehold Contracts dated January 23, 1976 are null and
void must be sustained.
 N D D E V E L O P M E N T
ST R U C T I O N A
VHJ CON S E N T E D B Y I T S
R P O R A T I O N , R E P R E
CO . H E R C E ,
N T E D
PRESIDENT, VICE U R T O F A PP E A L S,
T I T IO N E R ,  V S. C O
JR., PE R I A N R E FO R M
AR T M E N T O F A G R A
DE P , G E L A C I O B A T A R I O,
T I O N B O A R D
ADJUDICA ,  R E SP O N D E N T S .
R T I N B A T A R I O
AND MA

GR NO. 128534 August 13, 2004

 FACTS

o Petitioner VHJ Construction and Development Corporation was the owner in fee simple
of two (2) adjacent parcels of sugarland covered by Transfer Certificate of Title (TCT)
No. T-97535 with an area of 30,123 square meters; and, TCT No. T-97536, measuring
17,424 square meters, situated in Barangays Banay-Banay and Pulo, Cabuyao, Laguna,
respectively.

o On October 24, 1988, the petitioner entered into a one-year lease contract with Sinforoso
Entredicho over the parcels of land for an annual rental of P12,000.00. Entredicho issued
an Allied Banking Corporation check in favor of the petitioner for the said amount.
o The parties agreed that no tenancy relationship exist between the two of them.

o During the period of the lease, Entredicho allowed Gelacio and Martin Batario, the
private respondents herein, to work on the land.
o Entredicho received his share of the produce from the private respondents. The
lease contract between Entredicho and the petitioner was, thereafter, extended
for another year on October 27, 1989, or until October 24, 1990. Entredicho
paid the rental through Allied Banking Corporation Check No. 80147957.
o Upon its expiration, the contract was yet again extended for another year on
August 22, 1991.
o When the lease agreement expired in 1991, the petitioner demanded that
Entredicho vacate the premises. The latter told the private respondents to stop
working on the land, to harvest their produce before the year ended, and to
vacate the property.
o Instead of complying, the private respondents brought suit against the
petitioner and Entredicho on October 3, 1991 in the Department of Agrarian
Reform Adjudication Board (DARAB), Sta. Cruz, Laguna, for declaration of
agricultural tenancy on the property with a plea for preliminary injunction.
• On May 16, 1994, the Provincial Agrarian Reform Adjudicator
(PARAD) dismissed the complaint for lack of merit, holding that the
private respondents were mere farm workers on the property. The
dispositive portion reads:
• a) DECLARING the plaintiffs NOT the agricultural tenants of the
subject landholding BUT farm workers;
• b) DECLARING the subject landholding not covered by the CARP
Law; and
• c) DISMISSING the instant case for lack of merit.
• The private respondents appealed to the DARAB Central
Office, which rendered a Decision dated June 28, 1996,
reversing and setting aside the decision of the PARAD. 

• The DARAB held that the private respondents were de

jure and bona fide leasehold tenants and, as such, had
security of tenure. According to the DARAB, the legal
relationship of landholder-agricultural tenant on the
landholding can be created by and between a civil lessee
and the person who personally cultivates the land.
• The Court of Appeals dismissed its petition for review on
certiorari, it filed the instant petition before this Court,
contending that the appellate court erred in dismissing
outright its petition for review for its failure to comply with
SC Circular No. 28-91. According to the petitioner, the
DARAB erred in reversing the decision of the PARAD and
declaring that the private respondents were its agricultural
tenants.
 ISSUE

• Whether or not the Court of Appeals erred in

dismissing the decision of the DARAB in
reversing the decision of PARAD in declaring
that private respondents were its agricultural
tenants.
 HELD
• The Supreme Court held that the evidence on record shows that
Sinforoso Entredicho was a mere civil lessee of the petitioner and he
did not personally work on the land, and instead hired the private
respondents to cultivate the property. The private respondents
planted sugarcane and rice, and gave Entredicho his share of the
produce.

• Indeed, a tenancy relationship cannot be presumed. There must be

evidence to prove this allegation. The principal factor in determining
whether a tenancy relationship exists is intent. Tenancy is not a
purely factual relationship dependent on what the alleged tenant
does upon the land. It is also a legal relationship. 
• The requisites of a tenancy relationship are as follows: 
• (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. This is so because unless a person has established his status as
a de jure tenant, he is not entitled to security of tenure nor is he covered by
the Land Reform Program of the Government under existing tenancy
laws. The security of tenure guaranteed by our tenancy laws may be
invoked only by tenants de jure, not by those who are not true and lawful
tenants.
• In this case, there is no evidence that the petitioner installed
the private respondents as agricultural tenants on the
property. There is, likewise, no evidence that the petitioner
shared the harvest and/or produce from the landholding, as
the private respondents admitted that they shared the
produce from the property only with Entredicho.
• Nor is there any basis for petitioners claim that he is an
agricultural tenant. One of the essential requisites for the
existence of a tenancy relationship is sharing, by the
landowner and tenant, of the produce and no proof of this
fact has been shown in this case.
• The respondents knew or should have at least been aware that the
lease agreement between the petitioner and Entredicho was only for
one (1) year, renewable upon agreement. They should, likewise, have
known that upon the expiration of the lease contract, Entredicho
would be asked to vacate the property and surrender possession
thereof to the petitioner. The private respondents should have
known that they would have no right to continue working on the
property upon the expiration of the lease contract between the
petitioner and Entredicho.
• It must be stressed that the petitioner was not privy to the
agreement between the private respondents and Entredicho
involving the subject property. Hence, the petitioner is not bound by
said agreement.
• The Court cannot sustain the contention of the DARAB and the private
respondents that under Section 6 of Republic Act No. 3844, as amended,
the private respondents are nonetheless entitled to continue in possession
of the property and cultivate the same based on their agreement with
Entredicho despite the expiration of the lease contract between the
petitioner and Entredicho. In so doing, the Court would thereby be
granting to the private respondents rights which Entredicho, a mere civil
lessee, did not have. Entredicho could not grant the private respondents
rights which he himself did not possess. 
• It bears stressing that the petitioner did not specifically authorize
Entredicho to install the private respondents as tenants on the property.
Contrary to the private respondents contention, Section 6 of R.A. No.
3844 has no application.