CASE DIGEST

SECOND DIVISION
[ G.R. No. 140164, September 06, 2002 ]
DIONISIA L. REYES, PETITIONER,
VS.
RICARDO L. REYES, LAZARO L. REYES, NARCISO L. REYES AND MARCELO L. REYES, RESPONDENTS.
FACTS:
The instant case stemmed from a complaint for reinstatement with damages filed with the DARAB Region III
Office by Dionisia Reyes on April 22, 1991 against her four younger brothers, herein respondents. She alleged that her
father, the late Felizardo Reyes, was the tenant of a two-hectare agricultural lot in Parulan, Plaridel, Bulacan, owned by
Marciano Castro. After her fathers death on February 17, 1989, she and Marciano Castro, through the latters son and
attorney-in-fact, Ramon R. Castro, executed a leasehold contract naming her as the agricultural lessee of the property.
However, sometime before the start of the planting of the dry season crop in 1989, herein respondents forcibly entered the
area and occupied a one-hectare portion of the property. They claimed to be the tenants thereof. Respondents then paid
rent to the Castros overseer, Armando Duran, and continued to occupy half of the property to petitioners damage and
prejudice.
In their answer, respondents denied Dionisias claim that she was the bona fide leasehold tenant. They claimed
that they inherited the lease rights to the property from their deceased father. Respondents pointed out that petitioner was a
woman who could not possibly work or till the land by herself. They likewise averred that they were the ones actually
cultivating the portion occupied by them. Hence, petitioners claim to be the lawful agricultural lessee had no basis, either
in fact or in law.
In affirming the ruling of the PARAD, the DARAB Central Office found that pursuant to the agricultural lease
contract entered into between Dionisia and the Castros, the former was designated by the latter to substitute the late
Felizardo Reyes as tenant. It held:
When an agricultural tenant dies, the choice for the substitute tenant is given to the land
owner. It is the latter who has the option to place a new tenant of his choice on the land. That choice
is, however, not absolute as it shall be exercised from among the surviving compulsory heirs of the
deceased tenant. Hence, the surviving heirs cannot preempt that choice by deciding among
themselves who shall take-over the cultivation or opting to cultivate the land collectively. It is only
when the landowner fails to exercise such right, or waive the same, that the survivors may agree
among themselves regarding the cultivation. The law is specific on the matter as so provided in
Section 9, Republic Act No. 3844

Neither is their argument that Plaintiff-Appellee, being a woman, is not capable of discharging the demands of
farming, valid. This Board finds said argument anachronistic with the changing times of great awareness of the potentials
of women. Women today are found manning our commerce and industry, and agriculture is no exception.
On appeal, respondents changed their theory. They abandoned their argument that they had inherited the tenancy
rights of their late father and instead postulated that an implied tenancy had been created when the Castros overseer
accepted rentals totaling 40 cavans of palay from them on behalf of the owner.
The Court of Appeals held that an implied tenancy existed between herein respondents and the landowner. On
this account, the acquiescence of Duran in allowing or permitting petitioner Ricardo Reyes to posses and cultivate of the
one (1) hectare subject property immediately after the death of Felizardo is binding to the Castro family including Ramon
Castro, the new landowner.
ISSUES:
(1) Did the Court of Appeals err in disregarding the substantial evidence rule with respect to the DARAB findings?
(2) Did the appellate court commit a reversible error of law in finding that respondents had satisfactorily met the
requirements of a tenancy relationship?
HELD:
As held in Malate vs. Court of Appeals, appeals in agrarian cases, the only function required of the Court of
Appeals is to determine whether the findings of fact of the Court of Agrarian Relations are supported by substantial
evidence. And substantial evidence has been defined to be such relevant evidence as a reasonable mind might accept as

adequate to support a conclusion and its absence is not shown by stressing that there is contrary evidence on record, direct
or circumstantial, and where the findings of fact of the agrarian court are supported by substantial evidence, such findings
are conclusive and binding on the appellate court.
An examination of the record categorically shows that the findings of fact of the DARAB were supported by
substantial evidence. Perforce, the Malate ruling must apply to the instant case.
The finding of the DARAB that petitioner, by virtue of the contract of agricultural leasehold entered into between
her and the Castros, is the substitute tenant of the latter in lieu of her deceased father, is binding upon the appellate court
and this Court. Equally conclusive upon the court a quo and this Court is the finding by the DARAB that respondents
were mere usurpers who failed to present any proof as to the existence of a tenancy relationship between them and the
Castro family.
On the second issue, the appellate court found that an implied tenancy was created when Duran, the ex-overseer
of the Castros, acquiesced in the taking over and cultivation of a one-hectare portion of the land. It went on to rule that the
Castros were estopped from denying this implied tenancy in view of the fact that they had allowed Duran, as their agent,
to accept rentals from respondents.
Under R.A. 3844, two modes are provided for in the establishment of an agricultural leasehold relation: (1) by
operation of law in accordance with Section 4 of the said act; or (2) by oral or written agreement, either express or
implied. By operation of law simply means the abolition of the agricultural share tenancy system and the conversion of
share tenancy relations into leasehold relations. The other method is the agricultural leasehold contract, which may either
be oral or in writing. In the instant case, it is not disputed that an agricultural leasehold contract was entered into between
petitioner and Ramon Castro. Respondents, however, insist that an agricultural leasehold contract over a one-hectare
portion of the landholding arose as a result of the actions of Ramons overseer, who must be viewed as the latters agent.
They conclude that because of this implied leasehold, the application of the contract between petitioner and the landowner
should be limited to the remaining portion of the property.
Duran was a special agent under Article 1876 of the Civil Code. Durans duties and responsibilities as a special
agent do not include the acceptance of rentals from persons other than the tenant so designated by the landowner. Durans
authority as a special agent likewise excludes the power to appoint tenants or successor-tenants. Clearly, Duran acted
beyond the limits of his authority as an agent.
Absent substantial evidence to show Durans authority from the Castros to give consent to the creation of a
tenancy relationship, his actions could not give rise to an implied tenancy. And the alleged acceptance of 40 cavans of
Ramon is just a hearsay evidence which has no probative value.
WHEREFORE, the petition is GRANTED. The decision of the Court of Appeals in CA-G.R. SP No. 47033 is
REVERSED and SET ASIDE. The judgment of the DARAB in DARAB Case No. 3625 affirming the decision of the
Provincial Adjudicator of DARAB Region III in DARAB Case No. 249-Bul-91 is hereby REINSTATED. No
pronouncement as to costs.