Law Summary
Form and Registration of Share Tenancy Contracts
- Contracts must be in triplicate, written in a language understood by all parties.
- Must be signed/thumb-marked by both landlord (or authorized representative) and tenant before two witnesses.
- Illiterate parties may have a witness read the contract to them.
- Copies retained by both parties; third copy filed and registered with the municipal treasurer's office where the land is located.
- Registration requires annotations in landlord’s and tenant’s contracts by the municipal treasurer.
- Forms prepared and furnished by the Department of Justice; no fees or stamps required.
- Oath or affirmation before municipal treasurer suffices for acknowledgment.
Freedom to Contract and Prohibited Stipulations
- Landlord and tenant may contract freely unless terms violate laws, morals, or public policy.
- Contract is conclusive unless challenged for fraud or error within 30 days of registration.
- Prohibited agreements include:
- Tenant receiving less than 55% of net produce when tenant furnishes animals, implements, and shares expenses equally.
- Tenant paying rent exceeding 25% of estimated normal harvest for fixed rental contracts.
- Tenant receiving less than 50% of net crop when landlord owns animals and tenant owns implements with equal expense sharing.
Share Basis and Division of Crops
- Without contrary written agreement:
- Tenant who provides implements, work animals, and all planting/cultivation expenses receives 70%-75% of net produce (depending on land quality).
- Landlord providing animals, implements, and expenses receives 70%, tenant 30%.
- When expenses are equally shared, crop is split 50-50.
- Harvesting and threshing expenses deducted from gross produce.
- Tenant pays for irrigation system maintenance; landlord pays amortization for system construction.
- Disputes over private irrigation system costs default to landlord bearing construction costs except distribution canals, which are tenant’s responsibility.
- Crop division occurs at threshing site; parties transport respective shares unless agreed otherwise.
Auxiliary Industry Provisions
- Tenant entitled to 80% of net produce if tenant bears all costs for second crops or auxiliary crops without written agreement to contrary.
- Auxiliary industry excludes gardens, poultry, or similar activities on tenant’s residential lot.
Rights Relating to Dwelling Lots
- Tenant may build a dwelling on cultivated land.
- Tenant is entitled to a residential lot sized between 600 and 1,000 square meters for dwelling and minor livelihood activities.
- Products from purpose-designated lot accrue exclusively to tenant.
- Upon tenancy cancellation, tenant has 45 days to remove the dwelling.
- Lot reverts to palay cultivation if not used for designated purposes for six months.
Effectivity and Lien for Landlord Advances
- Act takes effect immediately.
- Landlord who has advanced money, seeds, or similar to tenant holds a preferential lien on tenant’s share for the amount advanced plus 6% interest annually.