Hacienda Luisita vs.

PARC

G.R. No. 17110: July 5, 2011

FACTS:

Following the promulgation of the Courts Decision in the above-captioned case on July 5, 2011,
the petitioners present for resolution several issues concerning the said Decision. To recall, in the
2011 Decision, the Court ordered, among others, that the lands subject of Hacienda Luisita
Incorporateds (HLI) stock distribution plan (SDP) be placed under compulsory coverage on
mandated land acquisition scheme of the CARP and declared that the original 6,296 qualified
farmworker beneficiaries (FWBs) shall have the option to remain as stockholders of HLI.

ISSUES:

I. Whether or not the operative fact doctrine is applicable to the present case

II. Whether or not Sec. 31 of RA 6657 or the Comprehensive Agrarian Reform Law of 1988 is
constitutional

III. Whether or not the Court properly determined the coverage of compulsory acquisition

IV. Whether or not the matter on just compensation has been correctly passed upon by the Court

V. Whether or not the subject agricultural lands may be sold to third parties though they have
not been fully paid

VI. Whether HLI violated any of the provisions under the SDP

VII. Whether or not the ruling that the qualified FWBs should be given an option to remain as
stockholders of HLI is valid

HELD:

(1) The Operative Fact Doctrine is not limited to invalid or unconstitutional laws. Contrary to the
stance of respondents, the operative fact doctrine does not only apply to laws subsequently
declared unconstitutional or unlawful, as it also applies to executive acts subsequently declared
as invalid. The "operative fact" doctrine is embodied in De Agbayani v. Court of Appeals, wherein
it is stated that a legislative or executive act, prior to its being declared as unconstitutional by the
courts, is valid and must be complied with. Evidently, the operative fact doctrine is not confined
to statutes and rules and regulations issued by the executive department that are accorded the
same status as that of a statute or those which are quasi-legislative in nature.

(2) As We have succinctly discussed in Our July 5, 2011 Decision, it took the Farmworkers Agrarian
Reform Movement (FARM) some eighteen (18) years from November 21, 1989 before it
challenged the constitutionality of Sec. 31 of RA 6657. The question of constitutionality will not
be passed upon by the Court unless it is properly raised and presented in an appropriate case at
the first opportunity. FARM is, therefore, remiss in belatedly questioning the constitutionality of
Sec. 31 of RA 6657. The second requirement that the constitutional question should be raised at
the earliest possible opportunity is clearly wanting. The last but the most important requisite that
the constitutional issue must be the very lis mota of the case does not likewise obtain. The lis
mota aspect is not present, the constitutional issue tendered not being critical to the resolution
of the case. The unyielding rule has been to avoid, whenever plausible, an issue assailing the
constitutionality of a statute or governmental act. If some other grounds exist by which judgment
can be made without touching the constitutionality of a law, such recourse is favored. Based on
the foregoing disquisitions, We maintain that this Court is NOT compelled to rule on the
constitutionality of Sec. 31 of RA 6657.

(3) FARM argues that this Court ignored certain material facts when it limited the maximum area
to be covered to 4,915.75 hectares, whereas the area that should, at the least, be covered is
6,443 hectares, which is the agricultural land allegedly covered by RA 6657 and previously held
by Tarlac Development Corporation (Tadeco). We cannot subscribe to this view. Since what is put
in issue before the Court is the propriety of the revocation of the SDP, which only involves
4,915.75 has. of agricultural land and not 6,443 has., then We are constrained to rule only as
regards the 4,915.75 has. of agricultural land.

(4) In Our July 5, 2011 Decision, We stated that "HLI shall be paid just compensation for the
remaining agricultural land that will be transferred to DAR for land distribution to the FWBs." We
also ruled that the date of the "taking" is November 21, 1989, when PARC approved HLIs SDP per
PARC Resolution No. 89-12-2.

We maintain that the date of "taking" is November 21, 1989, the date when PARC approved HLIs
SDP per PARC Resolution No. 89-12-2, in view of the fact that this is the time that the FWBs were
considered to own and possess the agricultural lands in Hacienda Luisita. To be precise, these
lands became subject of the agrarian reform coverage through the stock distribution scheme only
upon the approval of the SDP, that is, November 21, 1989. Thus, such approval is akin to a notice
of coverage ordinarily issued under compulsory acquisition.

(5) There is a view that since the agricultural lands in Hacienda Luisita were placed under CARP
coverage through the SDOA scheme on May 11, 1989, then the 10-year period prohibition on the
transfer of awarded lands under RA 6657 lapsed on May 10, 1999, and, consequently, the
qualified FWBs should already be allowed to sell these lands with respect to their land interests
to third parties, including HLI, regardless of whether they have fully paid for the lands or not. The
proposition is erroneous. Under RA 6657 and DAO 1, the awarded lands may only be transferred
or conveyed after ten (10) years from the issuance and registration of the emancipation patent
(EP) or certificate of land ownership award (CLOA). Considering that the EPs or CLOAs have not
yet been issued to the qualified FWBs in the instant case, the 10-year prohibitive period has not
even started. Significantly, the reckoning point is the issuance of the EP or CLOA, and not the
placing of the agricultural lands under CARP coverage.

(6) AMBALA and FARM reiterate that improving the economic status of the FWBs is among the
legal obligations of HLI under the SDP and is an imperative imposition by RA 6657 and DAO 10.
FARM further asserts that "[i]f that minimum threshold is not met, why allow [stock distribution
option] at all, unless the purpose is not social justice but a political accommodation to the
powerful."

Contrary to the assertions of AMBALA and FARM, nowhere in the SDP, RA 6657 and DAO 10 can
it be inferred that improving the economic status of the FWBs is among the legal obligations of
HLI under the SDP or is an imperative imposition by RA 6657 and DAO 10, a violation of which
would justify discarding the stock distribution option.

(7) Upon a review of the facts and circumstances, We realize that the FWBs will never have
control over these agricultural lands for as long as they remain as stockholders of HLI. In line with
Our finding that control over agricultural lands must always be in the hands of the farmers, We
reconsider our ruling that the qualified FWBs should be given an option to remain as stockholders
of HLI, inasmuch as these qualified FWBs will never gain control given the present proportion of
shareholdings in HLI.

Moreover, bearing in mind that with the revocation of the approval of the SDP, HLI will no longer
be operating under SDP and will only be treated as an ordinary private corporation; the FWBs
who remain as stockholders of HLI will be treated as ordinary stockholders and will no longer be
under the protective mantle of RA 6657.

In addition to the foregoing, in view of the operative fact doctrine, all the benefits and homelots
received by all the FWBs shall be respected with no obligation to refund or return them, since, as
We have mentioned in our July 5, 2011 Decision, "the benefits x x x were received by the FWBs
as farmhands in the agricultural enterprise of HLI and other fringe benefits were granted to them
pursuant to the existing collective bargaining agreement with Tadeco."

Morta vs. Occidental et. Al

GR No. 123417 June 10, 1999

FACTS:

Petitioners filed 2 cases of damages with preliminary injunction with the MTC of
Guinobatan, Albay against respondents.

In the complaints, petitioners alleged that respondents, through the instigation of Atty.
Baranda Jr., gathered pilinuts, anahaw leaves and coconuts from their respective land,
delivered the same to the latter and destroyed their banana and pineapple plants.
 In their answer, respondents claimed that petitioners were not the owners of the land in
question. They alleged that the torrens title is registered to the father of one Josefina Opiana-
Baraclan. Respondent Occidental contended that he was a bona fide tenant of Josefina. They
denied the accusations against them.

MTC rendered decision in favor of petitioners.

Respondents then appealed to the RTC questioning the MTC’s jurisdiction that the case
was cognizable by the DARAB and not of the MTC. RTC reversed MTC’s decision ruling that the
cases for damages are tenancy-related problems which fall under the original and exclusive
jurisdiction of DARAB. CA affirmed RTC’s ruling.

Hence this petition.

ISSUE:
WoN the civil actions for damages are tenancy-related and is cognizable by the DARAB
and not of the trial court.

HELD:
What determines the nature of an action as well as which court has jurisdiction over it,
are the allegations in the complaint and the character of the relief sought. Jurisdiction of the
court cannot be made to depend upon the defenses made by the defendant in his answer or
motion to dismiss. If such were the rule, the question of jurisdiction would depend almost
entirely upon the defendant.

For DARAB to have jurisdiction there must exist a tenancy-relationship between the
parties. For a tenancy agreement to take hold over a dispute, it would essential to establish all
its indispensable elements:
1. That the parties are the landowner and the tenant/agricultural lessee;
2. That the subject matter of the relationship is an agricultural land;
3. That there is consent between the parties to the relationship;
4. That the purpose of the relationship is to bring about agricultural production;
5. That there is personal cultivation on the part of the tenant or agricultural lessee;
6. That the harvest is shared between the landowner and the tenant/agricultural lessee.

The Court held in Vda. De Tangub v. CA, the jurisdiction of the DAR is limited to the ff:

1. Adjudication of all matters involving implementation of agrarian reform;

2. Resolution of agrarian conflict and land-tenure related problems;
3. Approval and disapproval of the conversion of agricultural lands into
residential; commercial, industrial and other non-agricultural uses.

Petitioner Morta claimed that he is the owner of the land. Thus, there is even a dispute
as to who is the rightful owner of the land. The issue of ownership shall be resolved in a
separate proceeding before the appropriate trial court between the claimants thereof and is
outside DARAB’s jurisdiction.

At any rate, the case cannot be considered as tenancy-related for it fails to comply with
other requirements. Thus, for failure to comply with the above requisites, we conclude that the
issue involved is not tenancy-related cognizable by the DARAB.

WHEREFORE, the Court SETS ASIDE the decision of the Court of Appeals in CA-G.R. SP No. 35300
and that of the Regional Trial Court in Civil Cases Nos. 1751 and 1752.

The Court AFFIRMS the decision of the Municipal Trial Court, Guinobatan, Albay, in Civil Cases
Nos. 481 and 482, for damages.

SO ORDERED.

175 SCRA 343 – Political Law – Constitutional Law – Bill of Rights – Equal Protection – Valid
Classification

Eminent Domain – Just Compensation

These are four consolidated cases questioning the constitutionality of the Comprehensive
Agrarian Reform Act (R.A. No. 6657 and related laws i.e., Agrarian Land Reform Code or R.A. No.
3844).

Brief background: Article XIII of the Constitution on Social Justice and Human Rights includes a
call for the adoption by the State of an agrarian reform program. The State shall, by law,
undertake an agrarian reform program founded on the right of farmers and regular farmworkers,
who are landless, to own directly or collectively the lands they till or, in the case of other
farmworkers, to receive a just share of the fruits thereof. RA 3844 was enacted in 1963. P.D. No.
27 was promulgated in 1972 to provide for the compulsory acquisition of private lands for
distribution among tenant-farmers and to specify maximum retention limits for landowners. In
1987, President Corazon Aquino issued E.O. No. 228, declaring full land ownership in favor of the
beneficiaries of PD 27 and providing for the valuation of still unvalued lands covered by the
decree as well as the manner of their payment. In 1987, P.P. No. 131, instituting a comprehensive
agrarian reform program (CARP) was enacted; later, E.O. No. 229, providing the mechanics for its
(PP131’s) implementation, was also enacted. Afterwhich is the enactment of R.A. No. 6657,
Comprehensive Agrarian Reform Law in 1988. This law, while considerably changing the earlier
mentioned enactments, nevertheless gives them suppletory effect insofar as they are not
inconsistent with its provisions.

[Two of the consolidated cases are discussed below]

G.R. No. 78742: (Association of Small Landowners vs Secretary)

The Association of Small Landowners in the Philippines, Inc. sought exception from the land
distribution scheme provided for in R.A. 6657. The Association is comprised of landowners of
ricelands and cornlands whose landholdings do not exceed 7 hectares. They invoke that since
their landholdings are less than 7 hectares, they should not be forced to distribute their land to
their tenants under R.A. 6657 for they themselves have shown willingness to till their own land.
In short, they want to be exempted from agrarian reform program because they claim to belong
to a different class.

G.R. No. 79777: (Manaay vs Juico)

Nicolas Manaay questioned the validity of the agrarian reform laws (PD 27, EO 228, and 229) on
the ground that these laws already valuated their lands for the agrarian reform program and that
the specific amount must be determined by the Department of Agrarian Reform (DAR). Manaay
averred that this violated the principle in eminent domain which provides that only courts can
determine just compensation. This, for Manaay, also violated due process for under the
constitution, no property shall be taken for public use without just compensation.

Manaay also questioned the provision which states that landowners may be paid for their land
in bonds and not necessarily in cash. Manaay averred that just compensation has always been in
the form of money and not in bonds.

ISSUE:

1. Whether or not there was a violation of the equal protection clause.

2. Whether or not there is a violation of due process.

3. Whether or not just compensation, under the agrarian reform program, must be in terms of
cash.

HELD:

1. No. The Association had not shown any proof that they belong to a different class exempt from
the agrarian reform program. Under the law, classification has been defined as the grouping of
persons or things similar to each other in certain particulars and different from each other in
these same particulars. To be valid, it must conform to the following requirements:

(1) it must be based on substantial distinctions;

(2) it must be germane to the purposes of the law;

(3) it must not be limited to existing conditions only; and

(4) it must apply equally to all the members of the class.

Equal protection simply means that all persons or things similarly situated must be treated alike
both as to the rights conferred and the liabilities imposed. The Association have not shown that
they belong to a different class and entitled to a different treatment. The argument that not only
landowners but also owners of other properties must be made to share the burden of
implementing land reform must be rejected. There is a substantial distinction between these two
classes of owners that is clearly visible except to those who will not see. There is no need to
elaborate on this matter. In any event, the Congress is allowed a wide leeway in providing for a
valid classification. Its decision is accorded recognition and respect by the courts of justice except
only where its discretion is abused to the detriment of the Bill of Rights. In the contrary, it appears
that Congress is right in classifying small landowners as part of the agrarian reform program.

2. No. It is true that the determination of just compensation is a power lodged in the courts.
However, there is no law which prohibits administrative bodies like the DAR from determining
just compensation. In fact, just compensation can be that amount agreed upon by the landowner
and the government – even without judicial intervention so long as both parties agree. The DAR
can determine just compensation through appraisers and if the landowner agrees, then judicial
intervention is not needed. What is contemplated by law however is that, the just compensation
determined by an administrative body is merely preliminary. If the landowner does not agree
with the finding of just compensation by an administrative body, then it can go to court and the
determination of the latter shall be the final determination. This is even so provided by RA 6657:

Section 16 (f): Any party who disagrees with the decision may bring the matter to the court of
proper jurisdiction for final determination of just compensation.

3. No. Money as [sole] payment for just compensation is merely a concept in traditional exercise
of eminent domain. The agrarian reform program is a revolutionary exercise of eminent domain.
The program will require billions of pesos in funds if all compensation have to be made in cash –
if everything is in cash, then the government will not have sufficient money hence, bonds, and
other securities, i.e., shares of stocks, may be used for just compensation.

Luz Farms v. Secretary of DAR

G.R. No. 86889 December 4, 1990

Facts: On 10 June 1988, RA 6657 was approved by the President of the Philippines, which
includes, among others, the raising of livestock, poultry and swine in its coverage.

Petitioner Luz Farms, a corporation engaged in the livestock and poultry business, avers that it
would be adversely affected by the enforcement of sections 3(b), 11, 13, 16 (d), 17 and 32 of the
said law. Hence, it prayed that the said law be declared unconstitutional. The mentioned sections
of the law provies, among others, the product-sharing plan, including those engaged in livestock
and poultry business.
Luz Farms further argued that livestock or poultry raising is not similar with crop or tree farming.
That the land is not the primary resource in this undertaking and represents no more than 5% of
the total investments of commercial livestock and poultry raisers. That the land is incidental but
not the principal factor or consideration in their industry. Hence, it argued that it should not be
included in the coverage of RA 6657 which covers “agricultural lands”.

Issue: Whether or not certain provisions of RA 6657 is unconstitutional for including in its
definition of “Agriculture” the livestock and poultyr industry?

Ruling:

The Court held YES.

Looking into the transcript of the Constitutional Commission on the meaning of the word
“agriculture”, it showed that the framers never intended to include livestock and poultry industry
in the coverage of the constitutionally mandated agrarian reform program of the government.

Further, Commissioner Tadeo pointed out that the reasin why they used the term “farmworkers”
rather than “agricultural workers” in the said law is because “agricultural workers” includes the
livestock and poultry industry, hence, since they do not intend to include the latter, they used
“farmworkers” to have distinction.

Hence, there is merit on the petitioner’s argument that the product-sharing plan applied to
“corporate farms” in the contested provisions is unreasonable for being consficatory and
violative of the due process of law.

Natalia Realty, Inc. vs. Department of Agrarian Reform

225 SCRA 278 (1993)

Facts:
Petitioner Natalia Realty, Inc. is the owner of a 125.0078-ha land set aside by Presidential
Proclamation No. 1637 (1979) as townsite area for the Lungsod Silangan Reservation. Estate
Developers and Investors Corporation (EDIC), the developer of the area, was granted preliminary
approval and locational clearances by the then Human Settlements Regulatory Commission
(HSRC) for the establishment of the Antipolo Hills Subdivision therein. In November 1990, a
Notice of Coverage was issued by DAR on the undeveloped portion of the landholding. The
developer filed its objections and filed this case imputing grave abuse of discretion to respondent
DAR for including the undeveloped portions of its landholding within the coverage of CARP.
Issue:
Are lands already classified for residential, commercial or industrial use, and approved by HLURB
and its precursor agencies prior to 15 June 1988, covered by RA 6657?
Held:
Sec. 4 of RA 6657 states that the CARL covers "regardless of tenurial arrangement and commodity
produced, all public and private and agricultural lands" and as per the transcripts of the
Constitutional Commission, "agricultural lands" covered by agrarian reform refers only to those
which are "arable and suitable lands" and "do not include commercial, industrial and residential
lands." The land subject of the controversy has been set aside for the Lungsod Silangan
Reservation by Proclamation No. 1637 prior to the effectivity of RA 6657 and in effect converted
these lands into residential use. Since the Natalia lands were converted prior to 15 June 1988,
DAR is bound by such conversion, and thus it was an error to include these within the coverage
of CARL.

Zamoras vs Su, Jr. ,184 SCRA 248 , 1990

Facts: Victoriano Zamoras, was hired Roque Su, Jr., as

overseer
of his coconut land in Dapitan. He was made to supervise the coconut plantation and the sale of
copra. He was paid a salary plus 1/3 of the proceeds of the sales of the copra. Another one-third
of the proceeds went to the tenants and the other third to Su. Sometime in 1981, Su entered into
a loan with a certain Anito and authorized her to harvest coconuts from his property while his
loan was outstanding. Zamoras was then laid-off temporarily until Su could obtain a loan from
the Development Bank of the Philippines with which to pay Anita. He was no longer allowed to
work as overseer of the plantation and without his knowledge and consent, Anita, harvested the
coconuts without giving him his one-third share of the copra sales. Zamoras filed a complaint
against Su, and Anita for illegal termination and breach of contract with damages with the
Regional Arbitration Branch of the Ministry of Labor and Employment in Zamboanga City. The
Labor Arbiter rendered a decision holding that Zamoras, as overseer of the respondent's
plantation, was a regular employee whose services were necessary and desirable to the usual
trade or business of his employer and was thus illegally dismissed. Upon appeal to the NLRC, the
decision of the Labor Arbiter was reversed. It held that the relationship between the parties was
that of a landlord-tenant, hence, jurisdiction over the case rests with the Court of Agrarian
Relations.
Issue:
WON Zamoras is an employee of Su, Jr. and thus jurisdiction of the case is with the NLRC.
Ruling:
Since Zamoras is an employee, not a tenant of Su, it is the NLRC, not the Court of Agrarian
Relations,that has jurisdiction to try and decide Zamoras’ complaint for illegal dismissal
. It was held that Su hired Zamoras not as a tenant but as overseer of his coconut plantation.
There is no evidence that Zamoras cultivated any portion of Su's land personally or with the aid
of his immediate farm household. The essential requisites of a tenancy relationship are not
present. Rather those of an employer-employee relationship exists between them. These are the
following: 1. Zamoras was selected and hired by Su as overseer of the coconut plantation; 2. His
duties were specified by Su; 3. Su controlled and supervised the performance of his duties. He
determined to whom Zamoras should sell the copra produced from the plantation. And 4. Su
paid Zamoras a salary of P2,400 per month plus one-third of the copra sales every two months
as compensation for managing the plantation.
Gelos vs Court of Appeals G.R. No. 86186. May 8, 1992

Topic: Definition of Agricultural Tenancy

Facts: The Private Respondent owned the subject land of 25,000 square meters in Laguna. The
Landowner then entered in to a contract with the petitioner and employed him to be laborer
on the land with the wage of 5.00 peso a day.

The Petitioner first went the Court of Agrarian Relation and then went to Ministry of Agrarian
reform and asked the court to fix the agricultural lease rental of the land and his request was
granted.

The private respondent then filed a complaint of illegal detainer against the petitioner that was
that was dismissed by the Ministry of Agrarian reform for the existence of Tenancy relations
between the parties. The Private respondents appealed to the office of the President alleging
that there was no tenancy relation between the parties.

The RTC rendered dismissed the complaint and assailed that there was a tenancy relation
between the parties.

The Court of Appeals reversed the decision of the RTC.

Issue: Is there a Tenancy relation between the parties?

Held: No, it was clear that the petitioner were not intended to be tenant but a mere employee
of the private respondent as showed in the contract. The petitioner was paid for specific kind of
work. The court stressed many cases that:

"tenancy is not a purely factual relationship dependent on what the alleged

tenant does upon the land. It is also a legal relationship. The intent of the parties,
the understanding when the farmer is installed, and as in this case, their written
agreements, provided these are complied with and are not contrary to law, are
even more important."

It should also be considered that a tenant is defined under Section 5(a) R.A 1199 as a person
who himself and with the aid available from within his immediate farm household cultivates the
land belonging to or possessed by another, with the latter's consent, for purposes of
production, sharing the produce with the landholder under the share tenancy system, or paying
to the landholder a price-certain or ascertainable in produce or in money or both, under the
leasehold tenancy system.

Therefore the court laid down the requisites for the tenancy relationship to exist:

1) The parties are the landowner and the tenant;

2) The subject is agricultural land;

3) There is consent;

4) The purpose is agricultural production;

5) There is personal cultivation; and

6) There is sharing of harvest or payment of rental.

Absence of this clearly does not qualify someone to be a tenant. It is clear that it is not a
tenancy relationship that exists between the parties, what they have is employee-employer
relationship.

Teodoro vs. Macaraeg

27 SCRA 7 (1969)
Facts:
Macaraeg had been the lessee of the property of Teodoro for the past seven (7) years when he
was advised by the latter to vacate the property because it would be given to another tenant.
Thereafter, a new tenant was installed who forbade Macaraeg from working on the riceland. On
the other hand, Teodoro denied that Macaraeg was his tenant and claimed that he had always
leased all of his 39-hectare riceland under civil lease. He further claimed that after the expiration
of his "Contract of Lease" with Macaraeg in 1961, the latter did not anymore renew his contract.
Held:
The Contract of Lease between the parties contains the essential elements of a leasehold tenancy
agreement. The landholding in dispute is unmistakably an agricultural land devoted to
agricultural production. More specifically, the parties stipulated that "the property leased shall
be used or utilized for agricultural enterprise only." Furthermore, the parties also agreed that the
farmland must be used for rice production as could be inferred from the stipulation that "the
rental of nine (9) cavans of palay per hectare for one agricultural year . . . must be of the same
variety (of palay) as that produced by the LESSEE."
The land is definitely susceptible of cultivation by a single person as it is of an area of only four
and a half (4-1/2) ha. This court has held that even a bigger area may be cultivated personally by
the tenant, singly or with the help of the members of his immediate farm household.
From the stipulation that "the rental must be of the same variety as that produced by the
LESSEE," it can reasonably be inferred that the intention of the parties was that Macaraeg
personally work the land, which he did as found by the Agrarian Court, thus: "In the instant case,
petitioner (Macaraeg) cultivated the landholding belonging to said respondent (Teodoro) for the
agricultural year 1960-61 in consideration of a fixed annual rental." (italics supplied) Moreover,
there is no evidence that Macaraeg did not personally cultivate the land in dispute. Neither did
Teodoro allege, much less prove, that Macaraeg availed of outside assistance in the cultivation
of the said riceland.
Teodoro is the registered owner of the disputed landholding and he delivered the possession
thereof to Macaraeg in consideration of a rental certain to be paid in produce. Evidently, there
was a valid leasehold tenancy agreement. Moreover, the provision that the rental be accounted
in terms of produce — 9 cavans per hectare — is an unmistakable earmark, considering the other
stipulations, that the parties did actually enter into a leasehold tenancy relation (at 16-17;
underscoring supplied).
Agricultural tenancy relation is different from farm employer-farm employee relation. The
Court clarified the difference in the case ofGelos vs. CA, 208 SCRA 608 (1992), as follows:
On the other hand, the indications of an employer-employee relationship are: 1) the selection
and engagement of the employee; 2) the payment of wages; 3) the power of dismissal; and 4)
the power to control the employee's conduct — although the latter is the most important
element.
According to a well-known authority on the subject, tenancy relationship is distinguished from
farm employer-farm worker relationship in that: "In farm employer-farm worker relationship, the
lease is one of labor with the agricultural laborer as the lessor of his services and the farm
employer as the lessee thereof. In tenancy relationship, it is the landowner who is the lessor, and
the tenant the lessee of agricultural land. The agricultural worker works for the farm employer
and for his labor he receives a salary or wage regardless of whether the employer makes a profit.
On the other hand, the tenant derives his income from the agricultural produce or harvest." (at
614)
Parties: landholder and tenant
Tenant defined.
A tenant is "a person who by himself, or with the aid available from within his immediate
household, cultivates the land belonging to or possessed by another, with the latter's consent for
purposes of production, sharing the produce with the landholder or for a price certain or
ascertainable in produce or in money or both, under the leasehold tenancy system." (Rep. Act
No. 1199 [1954], sec. 5 (a)).
An overseer of a coconut plantation is not considered a tenant.