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468 Phil. 224


[ G.R. No. 147570, February 27, 2004 ]




Petitioners assail the decision[1] dated January 19, 2001, of the Court of Appeals in CA-GR SP No. 59110, which reversed that of the Provincial Agrarian Reform Adjudication Board,[2] Region III, dated May 9, 2000. The Board found that a tenancy relationship existed between petitioners and respondents, entitling petitioners to retain possession of the fishpond in dispute. The appellate court ruled against petitioners, declaring the PARAB’s decision void for want of jurisdiction.

Subject of this controversy is a private fishpond with an area of one million, two hundred fifty six thousand and four hundred thirty three (1,256,433) square meters in Barangay San Jose, Lubao, Pampanga. The records show that under a contract to petitioners as lessees by respondents as lessors, the fishpond was leased for P1,200,000.00 yearly rental. This contract is evidenced by a “Kasunduan Sa Pamuwisan,” spanning the period January 1, 1996 until December 31, 1999.[3]

Petitioners allege that they have been in peaceful possession of the fishpond as tenant-lessee since 1985. They present cash vouchers and hand-written receipts covering the period 1987 to 1997.[4] In September 1999, respondents gave verbal notice to terminate petitioners’ lease. According to petitioners, respondents wanted to terminate the contract because a third party offered to pay higher rent. However, despite petitioners’ counter-offer to match the increase in the rent, respondents appeared bent on removing petitioners from the premises.

For their part, respondents aver that there is no relationship of lease-tenancy by petitioners to speak of. They add that the existing contract between them and petitioners is an ordinary lease, governed by the Civil Code. Respondents further claim that petitioners failed to pay the agreed rental covering the period January 1, 1997 to December 31, 1997. Accordingly, respondents were constrained to file an ejectment case against petitioners before the Metropolitan Trial Court (MTC) of Malabon, Branch 55, conformably with the provision on venue in the lease contract.[5]

On July 21, 1997, the MTC issued a judgment based on a compromise agreement wherein the parties agreed, inter alia, that petitioners would vacate the leased premises not later than December 31, 1999.[6]

Both parties admit that the aforestated compromise agreement bore the imprimatur of the trial court. Equally admitted is the fact that petitioners were not represented by counsel when they entered into said compromise agreement.

On November 10, 1999, petitioners filed a complaint for maintenance of peaceful possession and issuance of mandatory preliminary injunction with the Provincial Agrarian Reform Adjudication Board, Region III (PARAB). Respondents filed a motion to dismiss it, alleging lack of jurisdiction, improper venue and litis pendentia, and/or res judicata. The PARAB in an order dated January 19, 2000 denied the motion to dismiss.

On January 6, 2000, Kenneth Bautista filed a motion for intervention.[7] He alleged that he had entered into a one year-joint venture agreement[8] dated November 30, 1998, to expire on December 30, 1999, with the petitioners to augment their harvest and enhance their fishpond technology. Intervenor claims that he has the right of possession over the subject fishpond as respondents (defendants in the PARAB complaint) executed a lease contract extending from January 1, 2000 to December 31, 2003 in his favor.[9] He claims that petitioners’ right as lessees of the fishpond already lapsed with the expiration of their contract on December 31, 1999.

On January 28, 2000, petitioners amended their complaint to include intervenor Kenneth Bautista as one of the defendants.

After the parties submitted their evidence and position papers, the PARAB rendered judgment in favor of herein petitioners. It found that petitioners have proved the existence of all the elements necessary to establish a tenancy relationship. Dated May 9, 2000, the judgment reads:

Wherefore, in view of the foregoing judgment is hereby rendered:
    1) Maintaining plaintiff-spouses Numeriano and Carmelita Romeo as tenants over the subject fishpond;

    2). Ordering the issuance of a Writ of Permanent Mandatory Injunction restoring plaintiffs in their peaceful possession of the fishpond in question and directing defendants and intervenor to cease and desist from doing any act which would deprive herein plaintiffs of their possession and cultivation of the subject fishpond;

    3). Ordering plaintiffs herein to post bond in the amount of 1.2 million pesos in favor of intervenor herein to answer for the damages which the latter might suffer if it should be found later on that the former is not entitled to the relief prayed for;

    4). Ordering the defendants and intervenor to respect the peaceful possession and cultivation by the plaintiffs of the subject fishpond;

    5). Declaring the lease contract between intervenor and defendants as null and void.[10]
In the meantime, while the complaint before the PARAB was pending, herein petitioners on December 10, 1999, (21 days before the expiration of the lease contract and the date to relinquish possession of the fishpond pursuant to the compromise agreement), filed with the RTC of Malabon, Branch 74, a petition for annulment of the MTC judgment, order, and compromise agreement.[11] Petitioners raised issues concerning the tenancy relationship, lack of assistance by counsel in arriving at the compromise agreement, as well as lack of jurisdiction by the MTC Malabon because the subject property is located in Lubao, Pampanga. Respondents filed a motion to dismiss premised on culpability of petitioners for forum shopping, including lack of cause of action to file the petition. On March 7, 2001, the RTC dismissed the petition for lack of cause of action and failure to prosecute.[12]

As it turned out, even before the RTC’s Order of dismissal came out in their favor, respondents had already elevated the controversy to the appellate court. To be precise, on June 8, 2000, respondents filed with the Court of Appeals a petition for certiorari assailing the May 9, 2000 decision of the PARAB. Finding in favor of respondents, the Court of Appeals, in a decision dated January 19, 2001, set aside the PARAB decision, decreeing thus:
WHEREFORE, premises considered, the instant petition is hereby GRANTED and GIVEN DUE COURSE. The assailed Order of January 19, 2000 and the questioned Decision dated May 9, 2000 are declared NULL and VOID for want of jurisdiction.

Let the final and executory judgment of the MTC of Malabon in Civil Case No. 1694-97 be executed immediately.

Petitioners’ motion for reconsideration of the said decision was denied by the CA in a resolution dated March 19, 2001. Heedless of this development, petitioners filed on April 4, 2001, a petition with the RTC of Malabon, Branch 170, for certiorari and prohibition with prayer for the issuance of preliminary injunction/restraining order. This petition questioned the order of execution dated February 26, 2001 issued by the MTC of Malabon, Branch 55, which ordered the execution of its judgment based on the compromise agreement.[14]

Then on April 11, 2001 petitioners filed before this Court an appeal via a petition praying for reversal of the abovestated CA decision, which ruled that the PARAB had no jurisdiction to hear and decide the complaint filed by petitioners, and thus ordered the immediate execution of MTC judgment.

Petitioners now assign the following as errors:


Principally, the issues for our resolution are (1) whether or not the PARAB had jurisdiction to hear and decide the complaint for maintenance of peaceful possession and issuance of mandatory preliminary injunction; (2) whether or not the compromise agreement duly approved by the MTC of Malabon, Branch 55, had the force and effect of res judicata; and (3) whether or not the PARAB decision should have been appealed to the Department of Agrarian Reform Adjudication Board (DARAB), and not the subject of a special civil action of certiorari filed with the Court of Appeals. These issues depend, in turn, on whether the fishpond, which is the subject of the controversy, is governed by the Comprehensive Agrarian Reform Law (CARL).

Noteworthy, respondents counter that petitioners are guilty of forum shopping in filing different complaints based on the same facts with different judicial and quasi-judicial bodies. Considering the circumstances of this case, however, we shall first tackle the substantial issues on the merits before the technical matter raised by respondents.

Petitioners aver that the PARAB had jurisdiction over the subject matter of the case as it involves a tenancy relationship. They further claim that this tenancy relationship has long been in existence since 1985 such that any amendment to the Comprehensive Agrarian Reform Law (CARL) to the effect that fishponds are excluded from the coverage of the latter cannot be given retroactive effect, hence, will not operate to divest the PARAB of its jurisdiction over the complaint.

The Court of Appeals in ruling that the PARAB has no jurisdiction relies on our ruling in the case of Atlas Fertilizer Corp. v. Secretary, Dept. of Agrarian Reform[16] where we held that Rep. Act No. 7881 expressly provides that fishponds and prawn farms are excluded from the coverage of CARL. In reversing the PARAB’s findings, the appellate court stated:
…[T]hat the provincial adjudicator’s jurisdiction is only to hear, determine and adjudicate all agrarian cases, AND disputes and incidents in connection therewith (DARAB New Rules of Procedure, Rule 2, Section 2), and considering further that lands devoted to fishing are not agricultural lands because the use of the land is only incidental to and not the principal factor in productivity, as implied by this Court in the Atlas case, it follows that the PARAB has no jurisdiction over the instant case.[17]
On the jurisdictional issue, we find that it was reversible error for the PARAB to have taken cognizance of petitioners’ complaint. The jurisdiction of the PARAB in this case is limited to agrarian disputes or controversies and other matters or incidents involving the implementation of the Comprehensive Agrarian Reform Program (CARP) under Rep. Act No. 6657, Rep. Act No. 3844 and other agrarian laws.[18] An agrarian dispute is defined as any controversy relating to tenurial arrangements, whether leasehold, tenancy, stewardship or otherwise, over lands devoted to agriculture, including disputes concerning farm workers associations or representation of persons in negotiating, fixing, maintaining, changing or seeking to arrange terms or conditions of such tenurial arrangements.[19]

Although Section 166 (1) of Rep. Act No. 3844 had included fishponds in its definition of agricultural land within its coverage, this definition must be considered modified in the light of Sec. 2 of Rep. Act No. 7881, which amended Section 10 of Rep. Act No. 6657, otherwise known as the Comprehensive Agrarian Reform Law (CARL). Expressly, the amendment has excluded private lands actually, directly and exclusively used for prawn farms and fishponds from the coverage of the CARL. In fact, under Section 3 (c) of R.A. No. 6657, as amended, defines an agricultural land as that which is devoted to agricultural activity and not otherwise classified as mineral, forest, residential, commercial or industrial land. In turn, Section 3 (b) thereof defines agricultural activity as the cultivation of the soil, planting of crops, growing of fruit trees, including the harvesting of such farm products, and other farm activities, and practices performed by a farmer in conjunction with such farming operations done by persons whether natural or juridical. Clearly, by virtue of the amendments to the CARL, the operation of a fishpond is no longer considered an agricultural activity, and a parcel of land devoted to fishpond operation is not agricultural land as therein defined.

Significantly, although there is no express repeal of Rep. Act No. 3844 as a whole, as in fact its provisions that are not inconsistent with Rep. Act No. 6657, may still be given suppletory effect, nonetheless, there is now irreconcilable inconsistency or repugnancy between the two laws as regards the treatment of fishponds and prawn farms. Such repugnancy leads us to conclude that the provisions of Rep. Act No. 6657 (CARL) supersede the provisions of Rep. Act No. 3844 insofar as fishponds and prawn farms are concerned. In any event, Section 76 of Rep. Act No. 6657 (CARL), as amended, provides that all other laws, decrees, issuances, or parts thereof inconsistent thereto are repealed or amended accordingly.[20]

Consequently, we rule that there is no agrarian tenancy relationship to speak of in this case at this time, since certain requirements set by present law on the matter have not been met. Among these are: (1) the subject matter should be agricultural land; (2) the purpose should be agricultural production; and (3) there should be personal cultivation done by the tenants themselves.[21]

Unless the requisite elements of agrarian tenancy concur in order to create a tenancy relationship between the parties, we cannot bring the matter within the purview of tenancy under CARL. The absence of one element makes an occupant of a parcel of land, or a cultivator thereof, or a planter thereon outside the scope of CARL. Nor can such occupant, cultivator or planter be classified as a de jure agricultural tenant for purposes of agrarian reform law. And unless a person has established his status as a de jure tenant, he is not entitled to security of tenure nor is he covered by the Land Reform Program of the Government under existing agrarian reform laws.[22]

Here, we also find that petitioners failed to prove their personal “cultivation” of the area in question. There is personal cultivation if the tenant (lessee) cultivates the land himself or with the aid of the immediate farm household, which refers to the members of the family of the tenant (lessee) and other persons who are dependent upon him for support and who usually help him in the activities.[23] Particularly fatal to petitioners’ cause is the joint venture agreement with Kenneth Bautista. This agreement provides, among others, that Kenneth Bautista will share in the operation and management of the fishpond; pay the agreed rentals to the registered owner of the land; and that after deducting all operational expenses, Kenneth Bautista and petitioners shall have equal share in the net profits.[24] Not only does it reflect lack of personal cultivation by petitioners, but it also shows the nature of their fishpond operation is that of a large scale commercial venture.

Petitioners claim vested rights arising from the alleged existing tenancy relations. But this cannot be done validly under the present circumstances of this case. Section 2(b)[25] of Rep. Act No. 7881 now contains a proviso, precisely to protect vested rights of those who have already been issued a Certificate of Land Ownership Award (CLOA). Without such CLOA no vested rights could now be claimed by petitioners. In any event, petitioners failed to substantiate their allegation that they have been in possession of the fishpond as early as 1985. The records show that the lease contract began on January 1, 1996, to end on December 31, 1999. Petitioners have not shown other pieces of evidence in their favor that would show possession prior to this lease contract, to prove their allegation of prior occupancy.

Coming now to the issue of res judicata, we find that the elements thereof have been duly established in favor of respondents, to wit: (1) there is a final judgment or order; (2) the court rendering it has jurisdiction over the subject matter and the parties; (3) the judgment or order is on the merits; (4) there is between the two cases identity of parties, subject matter and causes of action.[26] The compromise agreement between the parties was duly approved by the MTC of Malabon, Branch 55. Absent any evidence that mistake, fraud, violence, intimidation, undue influence, or falsity of documents that vitiated the compromise agreement, the agreement must be upheld. Petitioners claim that counsel did not assist them at the time the court approved the compromise agreement. However, this fact alone does not ipso facto result in a mistake under the law as to render inutile the approval of the trial court. In the absence of any evidence to counter the presumption of regularity of the performance of official duty, such presumption of regularity should be upheld.[27] Besides, it is presumed that a person would take ordinary care of his concerns,[28] such that petitioners’ failure to obtain counsel at that time must be deemed with full knowledge of the consequences thereof. Had petitioners truly believed that the compromise agreement should have been stricken down, the proper course to take would have been to file a motion to set aside the agreement on grounds of nullity under Article 2038 of the Civil Code. It is well settled that a judicial compromise has the effect of res judicata and is immediately executory and not appealable unless set aside as abovestated.[29] Should the motion to set aside the compromise agreement be denied, petitioners may then appeal the denial. Further, a judgment based on a compromise agreement is a judgment on the merits, wherein the parties have validly entered into stipulations and the evidence was duly considered by the trial court that approved the agreement.

That the MTC of Malabon, Branch 55, had jurisdiction over the case for ejectment, to begin with, is in our view beyond dispute. It is a basic tenet of law that courts acquire jurisdiction over the subject matter based on the allegations of the complaint.  The assertions in the answer by the defendant cannot divest the court of said jurisdiction. The original complaint filed by respondents clearly alleged that it was a suit for ejectment, the jurisdiction of which is lodged with the proper MTC.

It cannot be denied also that in the actions filed by petitioners in the different courts, as well as in the PARAB, there is identity of parties, of subject matter and of causes of action. The ultimate test in ascertaining the identity of causes of action in two suits is to look into whether or not the same evidence fully supports and establishes both the present cause of action and the former cause of action. If in the affirmative, the former judgment would be a bar.[30] Petitioners in all instances sought to prove the existence of tenancy relationship with respondents over a huge area devoted to fishpond operations. They had to present the same evidence in any case, and they did. On this score, we note that petitioners’ counsel failed to apprise this Court of all the actions tending to raise the same cause of action, filed in different judicial and quasi-judicial bodies, in contravention of the undertaking specified in the certification on non-forum shopping. Petitioners and their counsel made no mention of the petition for annulment of judgment/compromise agreement filed with the RTC of Malabon, Branch 74, nor of the petition for certiorari with injunction filed with RTC of Malabon, Branch 170, on April 4, 2001 assailing the February 26, 2001 order of execution of the municipal trial court. Petitioners through counsel showed a lack of candor in coming to this Court without full disclosure of prior actions taken successively or simultaneously. Respondents claim that petitioners engaged in forum shopping as shown by the records in this controversy. However, the Court deems it necessary to decide now this case on the merits, rather than merely relying on a technicality, for the sake of substantive justice due the concerned parties.

Finally, we rule that respondents correctly filed a special civil action of certiorari with the Court of Appeals, as provided under Section 1, Rule 65, observing the rules on hierarchy of courts. A special civil action of certiorari is an independent action, raising the question of jurisdiction where the tribunal, board, or officer exercising judicial or quasi-judicial functions has acted without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction.[31] As already discussed, the PARAB has no power to act on the case as the subject matter of the action was beyond the scope of its jurisdiction under the law. Petitioners would want respondents to appeal the PARAB ruling to the DARAB as a logical and proper remedy, rather than go on certiorari before the CA. Appeal in this case, however, would have been an inadequate remedy as precisely respondents were questioning the very jurisdiction of the PARAB to take cognizance of the case.

The availability of the ordinary recourse of appeal does not bar a party from making use of the extraordinary remedy of certiorari where the ordinary appeal would not be a prompt and adequate remedy, that is,[32] “[a] remedy which is equally beneficial, speedy and sufficient, not merely a remedy which at some time in the future will bring about a revival of the judgment of the lower court complained of in the certiorari proceeding, but a remedy which will promptly relieve the petitioner from the injurious effects of that judgment and the acts of the inferior court or tribunal.”[33]

The rationale behind CARL, (the Comprehensive Agrarian Reform Law, Rep. Act No. 6657) and other agrarian reform laws is to emancipate the small farmers and farm workers from the bondage of tilling land they do not own. They aim to put into their hands the cultivation of economically viable family-sized[34] farms. Earlier, the Land Reform Code (Rep. Act No. 3844) defined economic family-sized farm as an area of farm land that permits efficient use of labor and capital resources of the farm family, and will produce an income sufficient to provide a modest standard of living to meet a farm family’s need for food, clothing, shelter and education with possible allowance for payment of yearly installments on the land, and reasonable reserves to absorb yearly fluctuations in income.[35] Subsequently, Rep. Act No. 6657 was enacted declaring that it is the policy of the state to pursue a comprehensive agrarian reform program to the end that there be a more equitable distribution and ownership of land to provide small farmers and farm workers with the opportunity to enhance their dignity and improve the quality of their lives through greater productivity of agricultural lands.[36] Indeed, our agrarian laws have been enacted to make the small farmers more independent, self-reliant and responsible citizens and a source of genuine strength in our democratic society.[37]

In this case, however, the records do not show that petitioners are small farmers or farm workers deserving of the beneficence and protection afforded by our agrarian laws. It would stretch one’s imagination to consider petitioners as lowly farm workers when evidence shows in reality they are businessmen engaged in aquaculture, operating a huge fishpond with an area of one million, two hundred fifty six thousand and four hundred thirty three (1,256,433) square meters. Leasing this huge area could be better appreciated as falling properly under civil law lease rather than agrarian reform lease-tenancy. Moreover, in this case, there is no showing that large fishpond operators belong to the class of beneficiaries contemplated by legislators when they envisioned a policy of emancipation of small farmers or farm workers from bondage of the soil through agrarian reforms. In sum, we agree that the appellate court did not err in excluding the fishpond subject of the present controversy from the coverage of CARL, and holding the PARAB’s decision dated May 9, 2000 void for lack of jurisdiction.

WHEREFORE, the instant petition is DENIED for lack of merit. The assailed decision dated January 19, 2001 of the Court of Appeals is AFFIRMED. Costs against petitioners.


Austria-Martinez, Callejo, Sr., and Tinga, JJ., concur.

Puno, J., (Chairman), on leave.

[1] Rollo, pp. 41-49. Penned by Associate Justice Delilah Vidallon-Magtolis, with Associate Justices Teodoro P. Regino, and Josefina Guevara-Salonga concurring.

[2] CA Rollo, pp. 84-92.

[3] Id. at 21-A.

[4] Id. at 36.

[5] Id. at 22.

[6] Id. at 32-33.

[7] Rollo, pp. 31-32.

[8] CA Rollo, pp. 56-57.

[9] Id. at 88-89.

[10] Id. at 91-92.

[11] Id. at 58-65.

[12] Rollo, p. 70.

[13] Id. at 48-49.

[14] Id. at 90-91.

[15] Id. at 7-8.

[16] G.R. Nos. 93100 & 97855, 19 June 1997, 274 SCRA 30, 36.

[17] Rollo, pp. 47-48.

[18] Rule II, Sec. 1 of the Rules of Procedure Governing Proceedings Before the DAR Adjudication Board and Different Regional and Provincial Adjudicators.

[19] Section 3 (d), Rep. Act No. 6657, as amended.

[20] SEC. 76, Repealing Clause. — Section 35 of Republic Act No. 3844, Presidential Decree No. 316, the last two paragraphs of Section 12 of Presidential Decree No. 946, Presidential Decree No. 1038, and all other laws, decrees, executive orders, rules and regulations, issuances or parts thereof inconsistent with this Act are hereby repealed or amended accordingly. (RA 6657, as amended)

[21] See Section 166 (2), (3), RA 3844; Note that Section 4 of RA 3844, as amended, states that agricultural share tenancy throughout the country is declared contrary to public policy and shall be automatically converted to agricultural leasehold upon the effectivity of the said section.

[22] Caballes v. Department of Agrarian Reform, No. L-78214, 5 December 1988, 168 SCRA 247, 254, citing Tiongson v. Court of Appeals, No. L- 62626, 18 July 1984, 130 SCRA 482, 488.

[23] Handbook for CARP Implementors, p. 106, (2nd Ed.), Bureau of Agrarian Reform Information and Education, Department of Agrarian Reform.

[24] CA Rollo, p. 56.

[25] Sec. 2(b), R.A. 7881 (Amends Sec. 10, R.A. No. 6657) — “…private lands actually, directly and exclusively used for prawn farms and fishponds shall be exempt from the coverage of this Act: Provided that said prawn farms and fishponds have not been distributed and Certificate of Land Ownership Award (CLOA) issued to agrarian reform beneficiaries under the Comprehensive Agrarian Reform Program.”

[26] Linzag v. Court of Appeals, 353 Phil. 506, 522 (1998).

[27] Revised Rules of Court, Section 3 (m), Rule 131.

[28] Ibid, Sec. 3 (d).

[29] Salvador v. Ortoll, G.R. No. 140942, 18 October 2000, 343 SCRA 658, 668.

[30] Bachrach Corporation v. Court of Appeals, 357 Phil. 483, 492 (1998).

[31] Revised Rules of Court, Section 1, Rule 65.

[32] See J. Feria, Civil Procedure Annotated, pp. 465-466, citing Silvestre v. Torres, 57 Phil. 885, 893 (1933).

[33] Silvestre v. Torres and Oben, supra.

[34] Rep. Act No. 3844, Section 2 (1).

[35] Handbook for CARP Implementors, pp. 111-112 (2nd Ed.), Bureau of Agrarian Reform Information and Education, Department of Agrarian Reform.

[36] Rep. Act No. 6657, SEC. 2. Declaration of Principles and Policy.

[37] Rep. Act No. 3844, SEC. 2. Declaration of Policy.

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