Amendments to Agricultural Tecy Act

Policy and declared purposes

RA 2263 establishes and adjusts substantive protections for tenant rights within agricultural tenancy relationships, including limitations on dispossession and limits on landholder actions affecting tenants’ cultivation and organizing rights (Sections 3, 4, 5, 9, 11, 13, 16, 17, 18, 19, 21).

Core definitions added and amended

Leasehold tenancy exists when the cultivator undertakes to cultivate an agricultural land susceptible of cultivation by a single person together with members of the cultivator’s immediate farm household, for consideration in a fixed amount in money or in produce or in both (Section 1, amending Section 4 of RA 1199).
Agricultural year is the period necessary for raising seasonal agricultural products, including land preparation, sowing, planting, harvesting, and, when applicable, threshing (Section 2, amending Section 5(c)).
For crops where more than one harvest is obtained from one planting (including coconuts, citrus, coffee, ramie, and other crops), “agricultural year” means from the planting/land-of-the land to the first harvest, and thereafter harvest to harvest, and the period may be shorter or longer than a calendar year (Section 2, amending Section 5(c)).
Beginning of the agricultural year is the time the first farm operation for the principal crop is performed (such as seed-bed preparation in the case of rice) (Section 2, inserting Section 5(c-1)).
Broadcasting means strewing or scattering seeds directly to the landholding in lieu of transplanting (Section 2, inserting Section 5(g-1)).
Ratooning is cutting straw close to the ground at harvesting time after standing water is drained out so young tillers sprout from rootstocks and develop into mature normal bearing plants in three or four months, with fertilizer, manure, or compost (Section 2, inserting Section 5(g-2)).
Auxiliary crop means any product raised other than the crop the land is principally devoted to in each agricultural year, excluding the produce of the lot referred to in Section 22, paragraph three (Section 2, amending Section 5(r)).
Suited for mechanization means that more than 60% of the tenants’ labor as provided in the Act is displaced by farm machinery and that employment of mechanized implements will lower the cost of production (Section 2, inserting Section 5(s)).

Tenancy relationship rules and change of tenancy

The tenancy relationship is extinguished by the voluntary surrender or abandonment of the land by the tenant, or by the death or incapacity of the tenant (Section 3, amending Section 9).
In case of the tenant’s death or incapacity, the tenancy relationship continues between the landholder and one member of the tenant’s immediate farm household related within the second degree by consanguinity who will cultivate the land himself personally, unless the landholder cultivates the land himself personally or through employment of mechanical farm implements in accordance with Section 50 (Section 3, amending Section 9).
If the deceased or incapacitated tenant has two or more qualified household members, the landholder may choose which member succeeds (Section 3, amending Section 9).
Expiration of the contract period, or the sale, alienation, or transfer of legal possession, does not of itself extinguish the tenancy relationship (Section 3, amending Section 9).
In case of transfer of legal possession, the purchaser or transferee assumes the rights and obligations of the former landholder toward the tenant (Section 3, amending Section 9).
If the landholder dies, his heir or heirs assume his rights and obligations (Section 3, amending Section 9).
The tenant has the right to change from share tenancy to leasehold tenancy and vice versa, and from one crop sharing arrangement to another of the share tenancy (Section 4, amending Section 14).
If the share tenancy contract is in writing and duly registered, the tenant may exercise the right to change crop sharing arrangements (or tenancy system) at least one month before the beginning of the next agricultural year after the expiration of the contract; without a registered written contract, the tenant may exercise the right at least one month before the agricultural year when the change shall be effected (Section 4, amending Section 14).

Tenant rights: home lot and participation

The tenant may prove contributions for production (aside from labor) when he can do so adequately and on time, subject to the provisions of Section 14 (Section 5, amending Section 22(2)).
The tenant has the right to demand a home lot suitable for dwelling with an area of not more than 3% of the tenant’s landholding, provided it does not exceed 1,000 square meters (Section 5, amending Section 22(3)).
The home lot must be located at a convenient and suitable place within the land of the landholder designated by the landholder, and the tenant constructs the dwelling and raises vegetables, poultry, pigs and other animals, and engages in minor industries, with products accruing exclusively to the tenant (Section 5, amending Section 22(3)).
The tenant’s dwelling in the assigned home lot cannot be removed except as provided in Section 26, unless there is severance of the tenancy relationship as provided in Section 9, or unless the tenant is ejected for cause, and only after the expiration of 45 days following severance or dismissal (Section 5, amending Section 22(3)).

Landholder rights and required court resolution

The landholder may choose the kind of crop and the seeds the tenant shall plant, but if the tenant objects, the court resolves the conflict according to the best interest of both parties (Section 6, amending Section 25(1)).
No tenant may be ejected as a consequence of a change in crop (Section 6, amending Section 25(1)).
The landholder may require tenants to follow proven farm practices that contribute to increased agricultural production and to use fertilizer of the kind or kinds shown in proven farm practices adjusted to the requirements of the land (Section 6, amending Section 25(2)).
If the tenant disagrees with the required proven farm practices, the court determines the conflict according to the best interest of both parties (Section 6, amending Section 25(2)).

Landholder obligations and prohibitions

The landholder must furnish the tenant a home as provided in Section 22(3) (Section 7, amending Section 26).
If the landholder designates another site for the home lot than the one already occupied by the tenant, the landholder must bear the expenses of transferring the existing house and improvements to the newly designated site (Section 7, amending Section 26).
If the tenant disagrees to the transfer of the home lot, the matter must be submitted to the court for determination (Section 7, amending Section 26).
The landholder must not mortgage the share of the tenant in the crop, and any mortgage executed by the landholder on the land and/or its crop does not affect the share of the tenant in the crop (Section 8, inserting Section 27(4)).
The landholder must not discourage, directly or indirectly, the formation, maintenance, or growth of a union or organization of tenants in the landholding (Section 8, inserting Section 27(5)).
The landholder must not initiate, dominate, assist, or interfere in the formation or administration of any tenant union or organization (Section 8, inserting Section 27(5)).

Crops, farming expenses, and sharing formulas

Fertilizer costs and expenses for pest and disease control evidenced by sales invoices and/or receipts are paid out of the gross harvest, and returned to the party who advanced the costs (Section 9, amending Section 28).
Weeding expenses beyond customary practice in the locality are paid out of the gross harvest and returned to the advancing party (Section 9, amending Section 28).
If there is disagreement on the cost of weeding, the court determines the same (Section 9, amending Section 28).
When the landholder directs the use of fertilizer and application of insect, disease, and rodent control measures, and weeding beyond customary practice, the landholder must advance the cost, which is deducted from the gross produce (Section 10, amending Section 31).
The share basis applies to ricelands producing a normal average of more than 40 cavans per hectare for the three agricultural years next preceding the current harvest (Section 11, amending Section 32).
On such ricelands, the parties receive as shares in the gross produce after (a) setting aside the amount of palay used as seed and (b) deducting the cost of fertilizer, pest and weed control, irrigation fees, reaping of not more than 10% of the gross harvest, threshing, and, when applicable, broadcasting or other farm operations not listed as contributions or labor of tenant (Section 11, amending Section 32).
The share allocation is based on the total equivalent of individual contributions computed using the following participation percentages: land 30, labor 30, farm implements 5, work animals 5, final harrowing of the field immediately before transplanting 5, and transplanting 25 (Section 11, amending Section 32).
If any enumerated contribution is not actually contributed because of the nature of the farming culture followed, the participation of that contribution is divided between the landholder and tenant in the same proportion as their total contribution to production (Section 11, amending Section 32).
The date of threshing must not be beyond one month from the date of stacking the harvest into big stacks (Section 12, amending Section 37(4)).

Crop harvesting limits and tenant dispossession

It is unlawful for either tenant or landholder, without mutual consent, to reap or thresh any portion of the crop at any time previous to the date set for threshing (Section 13, amending Section 39).
If the tenant needs food for his family and the landholder does not or cannot furnish such and refuses to allow early reaping or threshing, the tenant may reap or thresh not more than 10% of his net share in the last normal harvest after giving notice to the landholder or representative (Section 13, amending Section 39).
Violations of the prohibition on pre-threshing are treated and penalized under Section 57 and/or the general provisions of law applicable to the act committed (Section 13, amending Section 39).
The fixed consideration (rental) for use of ricelands must not be more than the equivalent of 25% for first class land and 20% for second class land of the average gross produce, after deducting the same amount of palay used as seed and the cost of harvesting and threshing of the past three normal harvests (Section 14, amending Section 46(a)).
The landholder may demand an increase in rental proportionate to increased production if improvements are introduced that increase farm productivity; if parties disagree, the court determines the reasonable increase (Section 14, amending Section 46(a)).
Riceland classification is determined by productivity: first class lands yield more than 40 cavans per hectare and second class lands yield 40 cavans or less, computed upon the normal average harvest of the three preceding normal harvests (Section 14, amending Section 46(a)).
Fixed consideration for agricultural land with fruit trees and other useful trees, crops, and plants whose produce is taken must not be more than 25% of the average gross produce of the past three normal harvests (Section 14, amending Section 46(b)).
Additional considerations for enjoyment of such trees and useful plants are decided and specified by negotiation between landholder-lessor and tenant-lessee (Section 14, amending Section 46(b)).
If the tenant-lessee plants and/or takes care of such trees and plants with the landholder-lessor’s consent, the tenant-lessee is compensated by the landholder in the manner agreed between them (Section 14, amending Section 46(b)).
When the landholding is planted to auxiliary crops, landholder-lessor and tenant-lessee divide the same according to Section 30 of the Act (Section 15, inserting Section 46(d)).
The tenant cannot be dispossessed by the landholder except for causes enumerated in the Act and only after the cause is proved before and dispossession is authorized by the court (Section 16, amending Section 49).
It is unlawful for any third party to dispossess the tenant except by order of the court (Section 16, amending Section 49).
Any violation of the tenant dispossession rules is penalized in accordance with Section 57 and/or general provisions of law applicable to the act committed (Section 16, amending Section 49).
In all cases where agricultural land is held under any system of tenancy, the tenant shall not be dispossessed except for the causes enumerated by law and only after court authorization (Section 16, amending Section 49).
Any of the following and no other causes are sufficient for dispossessing a tenant: (a) the landholder-owner or a relative within the first degree by consanguinity has a bona fide intention to cultivate the land himself personally or through employment of farm machinery and implements (Section 17, amending Section 50).
If the landholder-owner or that relative does not cultivate the land personally for at least three years, or if the landholder-owner and successor in interest fail to employ mechanical farm implements for at least five years after dispossession, it is presumed the landholder acted in bad faith, and the tenant may demand possession and damages for loss because of the dispossession (Section 17, amending Section 50).
Before filing the petition to dispossess under this cause, the landholder-owner (or relative) must file notice with the court at least one year but not more than two years before the petition date, and must inform the tenant in writing in a language or dialect known to the tenant (Section 17, amending Section 50).
The notice to both the court and tenant must be accompanied by: (1) a certification of the Agricultural Tenancy Commission that the land is suited for mechanization, and (2) a certification by the manager of the National Resettlement and Rehabilitation Administration that immediate resettlement will be provided to tenants if court authorization is granted (Section 17, amending Section 50).
If a dispossessed tenant is not willing to be resettled, possession is not enforced until one year from the date the decision becomes final (Section 17, amending Section 50).
Dispossessed tenants and immediate household members who were not resettled are preferred for employment of necessary laborers under the new set-up (Section 17, amending Section 50).
A landholder may mechanize certain farm operations in a tenanted farm without ejecting any tenant by filing a petition with the court accompanied by a certification that the farm operations will lower cost of production and improve farm culture; in that case, the court fixes the increase in landholder share proportionate to the labor displaced by farm machines (Section 17, amending Section 50).
A share-tenant’s failure to follow proven farm practices, as determined by the court of agrarian relations to contribute toward proper care of land and increased production, is a cause under the Act; when there is a conflict on whether the appropriate scientific system is a proven farm practice for particular land, the court decides using testimony of proper government officials (Section 17, amending Section 50(e)).

Commission duties, mediation, counsel representation

The Agricultural Tenancy Commission is required to perform its duties under the Act (Section 18, amending the first paragraph of Section 52).
The Secretary of Justice, acting through a tenancy mediation commission, must carry out a national enforcement program that includes mediation of tenancy disputes (Section 19, amending Section 53).
When a tenant cannot afford counsel, the trial attorney of the tenancy mediation commission must represent the tenant upon proper notification, or the court with competent jurisdiction must assign or appoint counsel de oficio for an indigent tenant (Section 20, amending Section 54).

Penalties for tenant-landholder violations

Violations of Section 27 (subsections one and three) and Sections 39 and 49 are punishable by a fine not exceeding PHP 2,000 or imprisonment not exceeding one year, or both, at the discretion of the court (Section 21, amending Section 57).
Any person who in bad faith induces or causes another to violate the above sections is punishable by a fine not exceeding PHP 4,000 or imprisonment not exceeding two years, or both, at the discretion of the court (Section 21, amending Section 57).
For juridical persons, the manager or person in charge of property management or administration is liable; in their default, the person acting in their stead is liable (Section 21, amending Section 57).

Pending cases, separability, and effectivity rule

RA 2263 applies to all cases pending in any Court at the time of approval (Section 22).
If any section or provision of RA 2263 is questioned in any court and held unconstitutional or invalid, other sections or provisions are not affected (Section 23).
RA 2263 takes effect upon approval (Section 24).