SECOND DIVISION
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BIENVENIDO T. BUADA, |
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G.R. No. 180374 |
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ISAIAS B. QUINTO, |
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NEMESIO BAUTISTA, |
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FREDDIE R. BAUTISTA, |
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Present: |
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CARLITO O. BUADA, |
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GERARDO O. BUADA, |
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CARPIO, J.,
Chairperson, |
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ARMANDO M. OLIVA, |
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BRION, |
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ROGELIO F. RAPAJON, and |
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EUGENIO F. FLORES, |
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ABAD, and |
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Petitioners, |
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PEREZ, JJ. |
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- versus - |
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Promulgated: |
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CEMENT CENTER, INC., |
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Respondent. |
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January 22, 2010 |
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D E C I S I O N
In all contractual, property or other relations,
when one of the parties is at a disadvantage on account of his moral
dependence, ignorance, indigence, mental weakness, tender age or other
handicap, the courts must be vigilant for his protection.[1]
This is a Petition for Review on Certiorari
assailing the July 19, 2007 Decision[2]
of the Court of Appeals (CA) in CA-G.R. SP No. 95154 which granted respondent’s
Petition for Review and nullified and set aside the Decisions of the Regional
Adjudicator[3]
dated March 9, 1999 and of the Department of Agrarian Reform Adjudication Board
(DARAB)[4]
dated March 11, 2005 dismissing the Complaint for Confirmation of Voluntary Surrender
and Damages filed by respondent.
Likewise assailed is the CA Resolution[5]
dated
Factual Antecedents
Petitioners Bienvenido T. Buada, Isaias B. Quinto,
Nemesio Bautista, Orlando T. Bautista, Freddie R. Bautista, Carlito O. Buada,
Gerardo O. Buada, Armando M. Oliva, Rogelio F. Rapajon, and Eugenio F. Flores were
tenant-farmers cultivating three parcels of agricultural land owned by respondent
Cement Center, Inc.[6]
On P3,000.00 each, voluntarily surrendered
their respective landholdings. However, despite
respondent’s repeated demands, petitioners refused to vacate subject
landholdings.
In their Answer,[8]
petitioners alleged that their consent to the Compromise
Agreement was obtained through fraud,
deceit, and misrepresentation. They claimed
that sometime in 1995, respondent induced them to sign a Compromise Agreement by
representing that the subject landholdings are no longer viable for
agricultural purposes. Petitioners
alleged that respondent assured them that they would only apply for the
conversion of the land and that they would have to surrender the land only upon
the approval of said application and that thereafter, they will be paid a
disturbance compensation of P3,000.00 each. Petitioners also claimed that respondent
promised to hire them to work on the project that was planned for the converted
land. But, should the application for conversion
be denied, petitioners will continue to be tenants and could later become
beneficiaries under the Comprehensive Agrarian Reform Law.
Ruling of the Regional
Adjudicator
On
WHEREFORE,
premises considered, Respondents being bonafide tenants of the subject
landholdings, the instant case is hereby DISMISSED for lack of merit.
SO ORDERED.[9]
The
Regional Adjudicator held that the Compromise Agreement was not enforceable
because it violated the provisions of Administrative Order No. 12, Series of
1994.[10] Said administrative order requires the
payment of disturbance compensation which should not be less than five times
the average of the annual gross value of the harvest on their actual
landholdings during the last five preceding calendar years. As such, the disturbance compensation being
offered by respondent to each of the petitioners, which is P3,000.00
plus the income derived from a single cropping, is grossly inadequate. The Regional Adjudicator likewise noted that
respondent did not offer homelots to the petitioners as required under the
aforesaid administrative order.
Finally,
the Regional Adjudicator held that since respondent’s application for
conversion was denied, then the purpose for the execution of the Compromise
Agreement was rendered nugatory. As a
consequence of the denial of the application, the subject landholdings shall be
placed under the Comprehensive Agrarian Reform Program (CARP) compulsory
coverage, as provided under the Administrative Order No. 12, Series of 1994.
Ruling of the DARAB
Aggrieved, respondent appealed to DARAB which
rendered its Decision on
WHEREFORE,
premises considered, the Appeal is DENIED and the assailed Decision is hereby
AFFIRMED.[11]
In affirming the Decision of the Regional
Adjudicator, the DARAB found that respondent failed to prove that petitioners
voluntarily surrendered their tenancy rights over the subject
landholdings. It held that since the
application for conversion was denied, then the Compromise Agreement is not a
perfected obligation; it is as if the petitioners’ voluntary surrender never
existed.
Ruling of the Court of Appeals
Alleging that the DARAB gravely erred and
committed grave abuse of discretion in dismissing its appeal, respondent
thereafter filed a Petition for Review with the CA. The CA found the appeal meritorious and
rendered its Decision in the following tenor:
WHEREFORE, in the
light of the foregoing, the instant Petition is GRANTED. The assailed decisions of the Department of
Agrarian Reform Adjudication Board (DARAB) dated March 11, 2005 and the
Regional Adjudicator dated March 9, 1999 are NULLIFIED and SET ASIDE. The petitioner’s Complaint for Confirmation
of Voluntary Surrender and Damages is likewise GRANTED.
The voluntary
surrender of the three (3) parcels of land covered by Transfer Certificate of
Title Nos. 127892, 123800, and 83276 by the respondents in favor of the
petitioner as embodied in the Compromise Agreement is hereby CONFIRMED.
Accordingly, the
respondents are ORDERED to VACATE the subject landholdings upon payment by the
petitioner to them of the amount of Three Thousand Pesos (P3,000.00)
each representing their disturbance compensation.[12]
The appellate court found the Compromise Agreement
executed by the parties to be valid. It
held that its enforceability is not subject to the approval by the DARAB of the
respondent’s application for conversion.
Likewise, the deficiency in consideration is not a ground to annul an
otherwise valid and enforceable agreement.
The appellate court also found petitioners to be literate on the ground
that they were able to affix their signatures to the agreement.
Petitioners’ Motion for Reconsideration was denied.
Hence, this petition.
Issues
In this Petition for Review on Certiorari petitioners
raise the following issues:
1. THE HONORABLE COURT OF APPEALS
GRAVELY ERRED IN MAKING AN INFERENCE [THAT] THE COMPROMISE AGREEMENT IS NOT
SUBJECT TO INTERPRETATION.
2. THE HONORABLE COURT OF APPEALS
GRAVELY ERRED IN MAKING [AN] INFERENCE (THAT) THE PETITIONERS WHO ARE TENANTS
ARE LITERATE THUS, THEY UNDERSTOOD THE IMPORT OF THE CONTRACT THEY SIGNED.
3. THE HONORABLE COURT OF APPEALS
GRAVELY ERRED IN MAKING (AN) INFERENCE (THAT) THE DEFICIENCY OF CONSIDERATION
(which is not in accordance with ADMINISTRATIVE ORDER NO. 12) DOES NOT NULLIFY
THE CONTRACT.
Our Ruling
The petition is impressed with merit.
Well-settled is the rule that this Court is not a
trier of facts. When supported by substantial evidence, the findings of fact of
the CA are conclusive and binding with, and are not reviewable by us unless the
case falls under any of the recognized exceptions. One of the exceptions is when the findings of
fact of the CA are contrary to those of the trial court[13]
or quasi-judicial agency. In this case,
the findings of fact of the CA and the DARAB are conflicting, thus we are compelled
to take a look at the factual milieu of this case.
It is
the policy of the State to promote the Security of Tenure of Farmers over their
leasehold.
Republic Act (RA) No. 3844 (1963), otherwise known
as the Agricultural Land Reform Code, declares it to be the policy of the State
to make small farmers more independent, self-reliant and responsible citizens,
and a source of genuine strength in our democratic society.[14] Towards this end, the same law guarantees the
security of tenure of farmers with respect to the land they cultivate, thus:
Section 7. Tenure
of Agricultural Leasehold Relation - 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. x x x
As an exception to this security of tenure, however,
Section 8 of RA 3844 specifically enumerates the grounds for the extinguishment
of agricultural leasehold relations, viz:
Section 8. Extinguishment of Agricultural Leasehold Relation.
— The agricultural leasehold relation established under this Code shall be
extinguished by:
(1) Abandonment of
the landholding without the knowledge of the agricultural lessor;
(2) Voluntary surrender of the landholding by the
agricultural lessee, written
notice of which shall be served three months in advance; or
(3) Absence of the
persons under Section nine to succeed to the lessee, in the event of death or
permanent incapacity of the lessee. (Emphasis
supplied)
Voluntary surrender, as a mode of extinguishment
of tenancy relations, does not require any court authorization considering that
it involves the tenant's own volition.[15]
To protect the tenant's right to security of tenure, voluntary surrender, as
contemplated by law, must be convincingly and sufficiently proved by competent
evidence. The tenant's intention to
surrender the landholding cannot be presumed, much less determined by mere
implication. Otherwise, the right of a
tenant farmer to security of tenure becomes an illusory one.[16] Moreover, RA 3844 provides that the voluntary
surrender of the landholding by an agricultural lessee should be due to circumstances more advantageous to
him and his family.[17]
The
Compromise Agreement did not constitute the “voluntary surrender” contemplated
by law.
Respondent asserts that petitioners voluntarily
surrendered their landholdings. Petitioners,
however, deny this claim and instead maintain that they did not execute the
Compromise Agreement with a view to absolutely sell and surrender their tenancy
rights in exchange for P3,000.00 for each of them. They assert that such agreement was subject
to suspensive conditions, i.e., the approval of respondent’s application
for conversion of the land to non-agricultural and their subsequent absorption
as laborers in the business that respondent will put up on said land, or, if
the application will not be approved, petitioners will continue to be tenants
of the land and could later on qualify as beneficiaries of the CARP. Petitioners assert that they were not aware
that these conditions were not incorporated in the Compromise Agreement because
they were not literate in the English language used. Neither were they represented by counsel nor
were the contents of the agreement explained to them. Petitioners thus claim that the Compromise Agreement
should be interpreted in accordance with the real intention of the parties
pursuant to Articles 1370 and 1371 of the Civil Code.[18] Petitioners likewise claim that as they were
illiterate in the English language, they could not have given their valid
consent to the Compromise Agreement. Lastly,
they aver that the disturbance fee of P3,000.00 for each tenant violates
Administrative Order No. 12, Series of 2004 which provides:
In all cases of petitions for
conversions resulting in the displacement of farmer-beneficiaries, such
beneficiaries shall be entitled to a disturbance compensation, which
should not be less than five (5) times the average of the annual gross value of
the harvest on their actual landholdings during the last 5 preceding calendar
years. In addition, the DAR
shall exert all efforts to see to it that free homelots and assured employment
for displaced beneficiaries are provided by the applicant/developer.
Respondent, on the other hand, counters that as
the Compromise Agreement does not reflect the conditions alleged by
petitioners, parol evidence should not be allowed to prove such conditions; that
petitioners cannot claim that they are illiterate in the English language and
that the contents of the agreement were not explained to them as it is
incumbent upon every contracting party to learn and know the contents of an
instrument before signing and agreeing to it; and, that it was not necessary
for petitioners to be assisted by counsel in signing the agreement as the
execution thereof is not akin to a custodial investigation or criminal
proceedings wherein the right to be represented by counsel is indispensable. As to the disturbance fee, respondent believes
that the sum of P3,000.00 for each tenant is fair and sufficient because
apart from said amount, petitioners were allowed to cultivate the lands for a
single cropping without any obligation to pay any lease rental in the form of
palay or cotton harvest or any other mode of payment.
As earlier stated, vital to these contentions is
the resolution of the basic issue of whether or not petitioners as
tenants-farmers intended to absolutely and voluntarily surrender their tenancy
rights over the subject landholdings.
Closer to, although not identical with, the
factual setting of this case is Talavera
v. Court of Appeals.[19] In said case, we found that the evidence on
record and therein petitioners' arguments were not enough to overcome the
rights of the private respondent as provided in the Constitution and the
agrarian statutes. The following
circumstances were considered: (1) the [K]asunduan executed by the
tenant-farmer in favor of the landowners wherein the former purportedly
voluntarily relinquished his tenancy rights for the amount of P1,000.00 was
prepared by one of the landowners; (2) the tenant-farmer continued to work on
the farm from 1973 to 1984 when the landowners ejected him, or for a period of
more than 10 years after the execution of the [K]asunduan; and, (3) it
was not shown why the tenant-farmer would voluntarily give up his sole source
of livelihood even if he needed money to pay off his debts or what he did from
1973 to 1984 if the claim of the Talaveras that they worked on the land
themselves during said period was correct.
Hence, we held that the [K]asunduan wherein the leasehold tenant allegedly
surrendered his tenancy rights voluntarily for the sum of P1,000.00, did
not constitute “voluntary surrender” as contemplated by law, and reinstated the
tenant in the landholding.
On the other hand, in Levardo v. Yatco,[20] we
upheld the waiver of tenancy rights and ruled that:
Based on the evidence on record, respondents paid
Aguido P2,000,000.00 and Hernando P2,417,142.00 as disturbance
compensation. A reading of the Pinanumpaang Salaysay executed by
petitioners show that they gave up their leasehold rights "dahil sa
aming kagustuhang umiba ng hanap buhay ng higit ang pagkikitaan kaysa panakahan."
The money given by respondents as
disturbance compensation was indeed advantageous to the families of
petitioners, as it would have allowed them to pursue other sources of
livelihood.
Petitioners did not refute in their pleadings the
authenticity of the documents purporting to be their waiver of tenancy rights.
As a matter of fact, they themselves attached the said documents to their
complaints and argued that said waivers were obtained through fraud and
misrepresentation, since they were unaware that CLTs were issued in their
names. However, such argument deserves scant consideration, since it has been
established that no such CLTs were issued to petitioners; and more importantly,
the lands in dispute do not fall under the coverage of P.D. No. 27. In
addition, said waivers of tenancy rights were notarized and therefore the same
have the presumption of regularity in their favor. (Emphasis supplied)
A perusal of the subject Compromise Agreement
reveals that the parties considered the amount of P3,000.00 together
with the income from a single cropping as comprising the disturbance
compensation package, viz:
4. The
aforeindicated income derived from the properties and the financial assistance
of P3,000.00 shall be considered as the disturbance compensation
package in favor of the SECOND PARTY by reason or as a result of their
vacating the premises in accordance with Administrative Order No. 1, Series
of 1990 of the Department of Agrarian Reform.[21]
(Emphasis supplied)
Petitioners, however, assail the disturbance
compensation package provided in the Compromise Agreement as insufficient and
contrary to Administrative Order No. 12, Series of 2004. They claim that they would not have acceded to
such a measly amount were it not for the agreement that respondent will hire
them as workers on the planned project on the subject land.
Despite the above contentions of petitioners,
respondent failed to present evidence to show that the disturbance compensation
package corresponds with the compensation required by the said Administrative
Order. Neither was there any showing
that said disturbance compensation is not less than five times the average
annual gross value of the harvest on petitioners’ actual landholdings during
the preceding five calendar years.
Moreover, it was not shown why petitioners as tenant-farmers
would voluntarily give up their sole source of livelihood. There was likewise no showing that the money
was indeed advantageous to petitioners’ families as to allow them to pursue
other sources of livelihood. To stress,
tenancy relations cannot be bargained away except for the strong reasons
provided by law which must be convincingly shown by evidence in line with the
State's policy of achieving a dignified existence for the small farmers free from
pernicious institutional restraints and practices.[22]
In view of the foregoing, we find the evidence on
record and respondent's arguments insufficient to overcome the rights of
petitioners as provided in the Constitution and agrarian statutes. The alleged voluntary surrender of petitioners
of their tenancy rights for the sum of P3,000.00 each could not
constitute as “voluntary surrender” within the contemplation of law.
WHEREFORE, the petition is GRANTED. The
Decision of the Court of Appeals in CA G.R. SP No. 95154 dated
SO ORDERED.
MARIANO
C.
Associate Justice
WE
CONCUR:
ANTONIO T. CARPIO
Associate Justice
Chairperson
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ARTURO D. BRION Associate Justice |
ROBERTO A. ABAD Associate Justice |
JOSE P. PEREZ
Associate Justice
ATTESTATION
I
attest that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court’s Division.
ANTONIO
T. CARPIO
Associate Justice
Chairperson, Second Division
C E R T I F I C A T I O N
Pursuant
to Section 13, Article VIII of the Constitution, and the Division Chairperson’s
attestation, it is hereby certified that the conclusions in the above Decision
had been reached in consultation before the case was assigned to the writer of
the opinion of the Court’s Division.
REYNATO S. PUNO
Chief Justice
[1] Civil Code of the
[2] Rollo,
pp. 7-17; penned by Associate Justice Amelita G. Tolentino and concurred in by
Associate Justices Lucenito N. Tagle and Sixto C. Marella, Jr.
[3]
[4]
[5]
[6] The
following are the area, location and Transfer Certificates of Title (TCT)
covering said parcels of land:
TCT
No. Area Location
127892
75,815 sq.
m. Batanguil,
Sison, Pangasinan
123800
75,815 sq.
m. Batanguil, Sison,
Pangasinan
83276 34,738
sq. m. Bahonan, Pozzorubio,
Pangasinan
[7] Rollo, pp. 75-78.
[8]
[9]
[10] Consolidated and Revised Rules and Regulations Governing Conversion of Agricultural Lands to Non-Agricultural Uses.
[11] Rollo,
p. 94.
[12]
[13] The
Consolidated Bank and Trust Corp. v.
Court of Appeals, 316 Phil. 246,
252 (1995) citing Massive
Construction, Inc. v. Intermediate Appellate Court, G.R. Nos. 70310-11, June 1, 1993, 223 SCRA 1, 7.
[14] Republic Act No. 3844, Section 2, par
(6).
[15] Jacinto v. Court of Appeals, 176 Phil.
580, 588 (1978).
[16] Ludo & Luym Development Corporation v.
Barretto, G.R. No. 147266, September 30, 2005, 471 SCRA 390, 405; Talavera v. Court of Appeals, G.R. No.
77830, February 27, 1990, 182 SCRA 778, 782.
[17] Republic Act No. 3844 provides:
Section 28. Termination
of Leasehold by Agricultural Lessee During Agricultural Year - The
agricultural lessee may terminate the leasehold during the agricultural year
for any of the following causes:
x x x x
(5)
Voluntary surrender due to circumstances
more advantageous to him and his family.
[18] Art. 1370.
If the terms of a contract are clear and leave no doubt upon the
intention of the contracting parties, the literal meaning of its stipulations
shall control.
If
the words appear to be contrary to the evident intention of the parties, the latter
shall prevail over the former.
Art.
1371. In order to judge the intention of the contracting parties, their
contemporaneous and subsequent acts shall be principally considered.
[19] G.R.
No. 77830,
[20] G.R.
No. 165494,
[21] Compromise
Agreement dated
[22] Talavera v. Court of Appeals, supra note 19
at 784, citing Republic Act No. 3844
Section 2 [2].