Case Summary (G.R. No. L-43800)
Questions Presented
- Whether a tenant’s right of redemption under the Code applies to sugar and coconut lands.
- Whether prior tender or judicial consignation of the redemption price is a condition precedent to validly exercising the right of redemption.
- Whether the Court of Agrarian Relations has jurisdiction over complaints for redemption of sugar and coconut lands.
Factual Background
Respondent Gonzales was an agricultural share tenant on land owned by members of the Angeles family. On September 30, 1968, the Angeleses sold the land to the petitioners without serving written notice to the tenant. The deed of sale was registered on March 27, 1969. Gonzales filed a redemption complaint on March 27, 1971 under Sections 11 and 12 of the Code of Agrarian Reforms. Petitioners alleged prior offers to Gonzales, that Gonzales lacked funds and was a dummy for an interested buyer, and that Gonzales had not tendered payment nor validly consigned the redemption price when he filed suit. Parties waived presentation of evidence and submitted memoranda. The Agrarian Court authorized Gonzales to redeem for P24,000, to be deposited within 15 days of receipt of decision; the Court of Appeals affirmed; the Supreme Court reviewed.
Legal Framework — Rights of Pre-emption and Redemption (Sections 11 and 12)
- Section 11 grants an agricultural lessee a preferential right to buy when the landholder decides to sell; it prescribes written notice, timelines (180 days) and requires the lessee to either tender payment or present a land bank certificate; if the lessor refuses, the lessee may consign payment in court.
- Section 12 provides that if the landholding is sold to a third person without the agricultural lessee’s knowledge, the lessee has a right to redeem within 180 days from notice by the vendee upon registration of sale; the redemption price is the reasonable price at the time of sale.
- The Court had earlier held in Hidalgo v. Hidalgo that Section 12 applies to both leasehold tenants and share tenants.
Applicability to Sugar and Coconut Lands
- The Code contains specific exemptions affecting tenancy classification for sugar and certain permanent tree crops (Section 4 and Section 35). Section 4 preserves share tenancy in lands subject to marketing allotments (including sugar) until a presidential proclamation, and Section 35 governs consideration and tenancy systems for coconut and other permanent-tree lands under a different statutory regime.
- The Court concluded these statutory exemptions are limited to tenancy classification and consideration; they do not negate the other rights conferred by the Code (in particular, the rights of pre-emption and redemption). Therefore, tenants in sugar and coconut lands remain entitled to exercise the right of redemption under Sections 11 and 12.
Requirement of Prior Tender or Judicial Consignation
- The Court held that timely exercise of the right of legal redemption requires either tender of payment or valid consignation in court. The reasoning, drawn from prior decisions presented in the record, is that without a bona fide tender the statutory redemption periods would be rendered meaningless and would allow indefinite uncertainty detrimental to purchasers and landowners.
- Tender or consignation demonstrates the redemptioner’s good faith and financial ability to complete the repurchase; consignation definitively establishes the ability to pay. While redemption does not simply discharge a pre-existing debt, a valid tender is indispensable to prevent harassment, speculative filings, and indefinite suspension of the landowner’s rights and marketability.
- In Hidalgo v. Hidalgo the Court did not eliminate this requirement; rather, it applied the Code and, by suppletory reference to Civil Code provisions, recognized the necessity of tender or consignation where applicable.
Application of Tender Requirement to the Case
- In the present case, Gonzales did not tender payment nor validly consign the redemption price at the time he filed his complaint on March 27, 1971. The Agrarian Court only ordered deposit of P24,000 in its October 10, 1973 decision, requiring deposit within 15 days after notice of decision. Because there was no prior tender or consignation when the action was commenced, the Supreme Court held that Gonzales failed to exercise the right of redemption in accordance with law.
Jurisdiction of the Court of Agrarian Relations
- Section 154 of the Code grants the Court of Agrarian Relations original and exclusive jurisdiction over all cases or actions involving matters, controversies, disputes or money claims arising from agrarian relations. Because the dispute—whether a tenant on sugar and coconut lands possessed a right of redemption—arose from agrarian relation
Case Syllabus (G.R. No. L-43800)
Procedural History
- Supreme Court First Division, G.R. No. L-43800, decision promulgated July 29, 1977; opinion by Justice Martin.
- Originating proceedings: Complaint for redemption filed March 27, 1971 with the Court of Agrarian Relations at Lipa City by respondent-share tenant Eulogio Gonzales under Sections 11 and 12 of the Agricultural Land Reform Code (Code of Agrarian Reforms).
- Agrarian Court hearing held May 29, 1973; parties waived presentation of evidence and agreed to decide on simultaneous memoranda.
- Agrarian Court rendered judgment October 10, 1973 authorizing redemption by respondent-tenant for P24,000.00, to be deposited with the Clerk of Court within fifteen (15) days from receipt of decision.
- Petitioners appealed to the Court of Appeals; the Appellate Court affirmed the Agrarian Court decision on January 30, 1976.
- Petitioners-spouses filed the present petition for review to the Supreme Court; the Supreme Court found merit and reversed the appealed decision.
Facts
- Respondent Eulogio Gonzales was an agricultural share tenant cultivating a 46,529-square-meter tract in Tanauan, Batangas, devoted to sugar cane and coconuts, owned by Glicerio, Sinfroso, Susana, Maria, Sebastian, Rufina, Bienvenido, Besmark and Cesar Angeles.
- On September 30, 1968 the landowners sold the property to petitioners Leonila Laurel Almeda and Venancio Almeda without serving respondent-tenant written notice of the sale.
- The deed of sale was registered with the Register of Deeds of Tanauan, Batangas on March 27, 1969.
- Gonzales filed a complaint for redemption on March 27, 1971 alleging rights under Sections 11 and 12 of the Code of Agrarian Reforms.
- Petitioners answered asserting, inter alia: (a) prior offer to sell to Gonzales who purportedly had no money; (b) Gonzales personally asked petitioners to buy the land fearing he might not be retained as tenant; (c) Gonzales was a dummy for another interested buyer; and (d) Gonzales made no tender of payment nor valid consignation in court when he filed his redemption complaint.
- At the Agrarian Court, parties waived further evidence and submitted memoranda; Agrarian Court ordered deposit only after judgment.
Legal Issues Presented
- Whether tenants in sugar and coconut lands have a tenant’s right of redemption under the Agricultural Land Reform Code (Sections 11 and 12).
- Whether prior tender or judicial consignation of the redemption price is a condition precedent to the valid exercise of the right of redemption.
- Whether the Court of Agrarian Relations has jurisdiction over complaints for redemption of sugar and coconut lands.
Relevant Statutory Provisions and Doctrinal Points (as cited in the decision)
- Section 11, Agricultural Land Reform Code (as amended): grants agricultural lessees preferential right of pre-emption when owner decides to sell; spells out notice periods and requires tender of payment or presentation of a Land Bank certificate or consignation if owner refuses tender.
- Section 12, Agricultural Land Reform Code (as amended): grants right of redemption where landholding is sold to a third person without the lessee’s knowledge; right exercisable within 180 days from written notice served upon registration of the sale; redemption price is the reasonable price at time of sale.
- Section 4 (as discussed): recognizes that agricultural share tenancy is generally converted to leasehold but provides an exemption mechanism (proclamation) for lands devoted to crops covered by marketing allotments, such as sugar.
- Section 35 (as discussed): provides that in fishponds, saltbeds and lands principally planted to citrus, coconuts, cacao, coffee, durian and similar permanent trees, the consideration and tenancy system shall be governed by Republic Act No. 1199, as amended.
- Section 154, Agricultural Land Reform Code (as amended): vests the Court of Agrarian Relations with original and exclusive jurisdic