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ALFONSO, CARLO P.

FEU, JD4202

1. Juan owns a five-hectare riceland. Pedro, an agricultural tenant, has been


working on the land since 1990. Compute the rent which Pedro has to pay given
the following averages for the last three agricultural years:

a. Sacks of palay harvested per hectare: 50 sacks

b. Price of palay per sack: P 300

c. Number of planting per year: 2

d. Costs of Production per hectare

i) Fertilizers: P 2000

ii) Harvesting: P 2000

iii) Threshing: P 2000

iv) Seeds: P 2000

v) Insecticides: P 2000

vi) Hauling: P 2000

Under Section 34 of Republic Act No. 3844, the lease rental to be paid by
all agricultural lessees shall not be more than the equivalent of twenty-five
percent of the average normal harvest during the three agricultural years
immediately preceding 15 June 1988, after deducting the amount used for seeds
and the cost of harvesting, threshing, loading, hauling and processing, whichever
is applicable. Thus, the rent which Pedro has to pay is computed as follows:

50 sacks of palay x 5 hectares = 250 sacks of palay


250 sacks of palay x Php 300.00 (per sack) = PHP 75, 000.00
Php 75, 000.00 (price of palay for the total of 5 hectares) x 2 (number of
planting per year) = PHP 150, 000.00
PHP 12, 000.00 (cost of production per hectare) x 5 (hectares) x 2 (number
of planting per year) = PHP 120, 000.00
PHP 150, 000.00 (average normal harvest) PHP 120, 000.00 (total cost of
production) = PHP 30, 000.00
PHP 30,000.00 (average normal harvest less the total cost) x 25% (maximum
percentage allowed by law) = PHP 7, 500.00
Hence, the lease rental to be paid by Pedro shall not be more than PHP 7, 500.00
per annum or PHP 22, 500.00 for three years.

2. If Pedro introduces secondary crops on the land,

a. What is a secondary crop?

Under Section 2 (5)(r) of Republic Act No. 2263, auxiliary or secondary


crop is defined as any product raised other than the crop to which the
cultivation of the land is principally devoted in each agricultural year; and
excluding the produce of the homelot.

b. Is this allowed or prohibited under the law? Explain.

The indroduction of secondary crops is allowed under the law.

Under Section 3.7. of DAR Administrative Order No. 06 Series of 2003,


Where the rental has been fixed, whether in case or in kind, such rental
shall constitute the consideration for the use of the land and the lessee
may diversify and/or plant auxiliary crops.

In this case, Pedro, being the lessee, may plant secondary crops on
the land he leases.

Therefore, Pedro is allowed to introduce secondary crops.

c. Can Juan ask for an increase in the monthly rent? Why or why not?

No. Juan cannot ask for an increase in the monthly rent.


Under Section 3.7. of DAR Administrative Order No. 06 Series of 2003,
where the rental has been fixed, whether in case or in kind, the lessee
may diversify and/or plant auxiliary crops. However, in such a case, the
tenant shall receive eighty per centum and the landholder twenty per
centum of the net produce provided that all the expenses of production
are shouldered by the tenant/lessee as stated in Section 30 of Republic
Act No. 1199.

In this case, Juan cannot ask for an increase in the monthly rent
despite the introduction of the auxiliary crops by Pedro. The planting of
secondary crops has already been considered by the parties when they
fixed the amount of rent. Nevertheless, Juan is entitled to twenty per
centum of the net produce in the said crops provided that Pedro
shouldered all the expenses of production.

Therefore, Juan cannot ask for an increase in rent but he may


demand the twenty per centum of the net produce.

d. When can the crops be changed from rice to corn?

The crops can be changed from rice to corn when the landholder
proposes such change.

Under Section 29 (2) of Republic Act 3844, it shall be the right of the
agricultural lessor to propose a change in the use of the landholding to
other agricultural purposes, or in the kind of crops to be planted:
Provided, That in case of disagreement as to the proposed change, the
same shall be settled by the Court according to the best interest of the
parties concerned.

In this case, rice can be changed to corn when Juan, the lessor,
proposes such change and Pedro, the lessee, agrees to said proposal. In
the event that Pedro rejects the proposed change, the Court shall settle
the disagreement taking into consideration the best interest of both
parties.

Therefore, the crops can be changed when the lessor and lessee
agree to the proposed change.

3. Aldo, the eldest, Barbara and Caloy, the youngest, are children of Juan, a
tenant of Don Subas. Juan is married to Elsa.

a. If Juan dies, who will succeed as the tenant(s) of Don Subas?

The person who will succeed Juan is either of his children or his spouse
depending on their capacity to cultivate the landholding and subject to
the choice of the agricultural lessor.

Under Section 9 of Republic Act No. 3844, in case of death or


permanent incapacity of the agricultural lessee to work his landholding,
the leasehold shall continue between the agricultural lessor and the
person who can cultivate the landholding personally, chosen by the
agricultural lessor within one month from such death or permanent
incapacity, from among the following: (a) the surviving spouse; (b) the
eldest direct descendant by consanguinity; or (c) the next eldest
descendant or descendants in the order of their age. In the event the
agricultural lessor fails to exercise his choice within the periods herein
provided, the priority shall be in accordance with the order herein
established.

In this case, the person who will succeed Juan is either his spouse or
one of his children subject to choice of Don Subas, the agricultural lessor.
However, if Don Subas failed to exercise his choice within the periods
provided in the law, the order of succession shall start from Elsa, the
surviving spouse, then Aldo, the eldest child, followed by Barbara, the
next eldest, and lastly by Caloy, the youngest.
Therefore, the person who will succeed Juan shall be chosen by Don
Subas or in the event the latter failed to choose, the priority shall be in
accordance with the order established in the law i.e. the surviving
spouse, the eldest direct descendant by consanguinity, or the next eldest
descendant or descendants in the order of their age.

b. If Don Subas goes to you for legal advice on the matter what will you
propose as the BEST option? Explain.

I would propose that he should exercise his right to choose among


the surviving heirs of Juan as provided in Section 9 or Republic Act No.
3844. He must choose who among them has the capacity to cultivate
personally for the best interest of the landholding. In this case, Don Subas
must exercise his right within one month after the death of Juan. If,
however, Juan died during the agricultural year, Don Subas must
exercise his right to choose at the end of that agricultural year. Indeed,
it would be the best option to use the prerogative of choosing who will
succeed the agricultural lessee considering that the order of succession
provided by the law would operate if the lessor did not exercise his right.
Thus, the possible implication is that the person who might succeed Juan
as lessee is not capable of cultivating the land personally to the
detriment of the lessor.

4. Under Republic Act No. 3844, it is provided that one of ground for dispossession
is, as follows:

The agricultural lessor-owner or a member of his immediate family will


personally cultivate the landholding or will convert the landholding, if
suitably located, into residential, factory, hospital or school site or other
useful non-agricultural purposes: Provided; That the agricultural lessee
shall be entitled to disturbance compensation equivalent to five years
rental on his landholding xxx
Such ground for dispossession is amended under Republic Act No. 6389, as
follows:
The landholding is declared by the department head upon
recommendation of the National Planning Commission to be suited for
residential, commercial, industrial or some other urban purposes:
Provided, that the agricultural lessee shall be entitled to disturbance
compensation equivalent to five times the average of the gross harvests
on his landholding during the last five preceding calendar years."
Give possible reasons why such amendment was made.
First, Republic Act No. 3844 or the Agricultural Land Reform Code contains
provisions establishing agricultural leasehold relation and conferring and
protecting the security of tenure of the agricultural lessee under Sections 5 and 7,
respectively.
Second, the agricultural leasehold relation is not extinguished by the death
or permanent incapacity of the agricultural lessee under Section 9 of Republic
Act No. 3844. Likewise, the leasehold relation is not severed 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 as provided in Section 10 of the same
law.
Third, it is the policy of the State to achieve a dignified existence for the
small farmers free from pernicious institutional restraints and practices.
In sum, the our laws protects the rights of a lessee from possible abuses of
his lessor. The purpose of our laws is to balance the rights of lessees who have
obviously less in life as compared to the lessors who have financial advantage.
Moreover, Republic Act No. 6389 was enacted with the principal aim and
purpose of curtailing and suppressing the pernicious practice of many
landowners who resort to the filing of cases of ejectment against their tenants
based on personal cultivation in retaliation to harrass tenants who were
determined to enforce the rights granted them by law (Aisporna v. Court of
Appeals, G.R. No. L-47533, October 27, 1981). Furthermore, Personal cultivation by
the landowner of his land ... as a basis for dispossession is being abused. This
provision is being availed of by landowners in driving their lessees out of their
landholding on the pretext of personal cultivation ... which often causes tension
and explodes as an agrarian unrest (The Code of Agrarian Reforms Annotated by
Justice Guillermo S. Santos, 1973 Revised Edition, p. 157)

5. When can the landowner ask for an increase in the lease rental?
The landowner can ask for an increase in the lease rental if capital
improvements are introduced on the farm not by the lessee to increase its
productivity.
Under Section 34 (4th proviso) of Republic Act No. 3844, the rental shall be
increased proportionately to the consequent increase in production due to said
improvements. In case of disagreement, the Court shall determine the reasonable
increase in rental.
Hence, there can be an increase in the lease rental if capital improvements
are introduced not by the lessee to increase the productivity.

6. Distinguish Sharehold from Leasehold Tenancy.


Under Section 3 of Republic Act No. 1199, agricultural tenancy is classified
into leasehold tenancy and share tenancy. The two tenancy systems are distinct
and different from each other.
In sharehold, the tenant may choose to shoulder, in addition to labor, any
one or more of the items of contributions (such as farm implements, work animals,
final harrowing, transplanting), while in leasehold, the tenant or lessee always
shoulders all items of production except the land. Under the sharehold system, the
tenant and the landholder are co-managers, whereas in leasehold system, the
tenant is the sole manager of the farmholding. Finally, in sharehold tenancy, the
tenant and the landholder divide the harvest in proportion to their contributions,
while in leasehold tenancy, the tenant or lessee gets the whole produce with the
mere obligation to pay a fixed rental (Peope v. Adillo, G.R. No. L-23785, November
27, 1975).

7. What kinds of crops, if any, are excluded in the computation of the lease rental?

Principal and auxiliary crops which are not existing at the time the leashold
agreement was established shall be excluded from the computation of the lease
rental.
Under Section 3.6. of DAR Administrative Order No. 06 Series of 2003, the
lease rental shall cover the whole farmholding attended to by the lessee.
Computation of the lease rental shall include both the principal and auxiliary
crops in the area as of the time the leasehold agreement was established.
Hence, those principal and auxiliary crops which are not existing at the time
of the establishment of leashold agreement shall not be included in the
computation of the lease rental.