GONZAGA-REYES, J.: HTML

Before us is a petition for review on certiorari of the Decision1 [Per Justice Conrado T. Limcaoco and concurred in by Justices Ricardo P. Tensuan and Gloria C. Paras.] of the Court of Appeals (CA), dated June 5, 1987, affirming the dismissal by the Regional Trial Court of Masbate, Branch 46, of the Complaint for Redemption with Damages filed by herein petitioner Gerardo Rupa, Sr. (RUPA) against herein private respondent Magin Salipot (SALIPOT).

The antecedents as found by the CA are as follows:

After hearing, the Regional Trial Court of Masbate (which had taken over the Court of Agrarian Relations pursuant to BP 129) rendered a decision dated July 17, 1985, dismissing the complaint on the ground that RUPA was not a tenant of the subject property, thus, not entitled to exercise the right of redemption over the same. RUPA was also held liable in attorney’s fees in the amount of P5, 000.00 and P3, 000.00 as litigation expenses. RUPA filed a notice of appeal. The CA required the parties to file their memoranda within a non-extendible period of 15 days from notice thereof, after which the case shall be considered submitted for decision with or without memoranda.4 [Intermediate Appellate Court Special Cases Roll, p. 12.] SALIPOT manifested that he was adopting the memorandum filed with the court a quo, while no memorandum was received from RUPA.5 [Ibid., p. 15.] The decision of the trial court was affirmed in toto by the CA in its judgment promulgated on June 5, 1987, holding as follows:

Hence, this petition was filed to seek a reversal of the decision of the CA. According to RUPA, the CA erred in declaring that he is not a share tenant based on passing statements contained in a decision in another case and on the certificate issued by the Office of the Municipal Treasurer that RUPA was engaged in business as copra buyer from May 19, 1978 to October 10, 1979. Consequently, this Court is asked to determine the real status of RUPA, who claims to be a tenant of the subject land and entitled to the benefits of tenancy laws. SALIPOT objects, contending that the instant petition should be dismissed considering that the issue raised is factual and that the admission made by RUPA in the course of a judicial proceeding is a substitute for and reason to dispense with the actual proof of facts.

We do not agree with the contentions of private respondent SALIPOT. The CA committed reversible error in relying mainly on statements made in a decision in another case, and, secondarily on the certificate of the Municipal Treasurer as basis for establishing the status of petitioner as share-tenant in the subject land.

True, whether a person is a tenant or not is basically a question of fact and the findings of the respondent CA and the trial court are, generally, entitled to respect and non-disturbance.7 [Guerrero vs. Court of Appeals, 142 SCRA 136 (1986)] In Talavera vs. Court of Appeals,8 [182 SCRA 778 (1990)] this Court held that a factual conclusion made by the trial court that a person is a tenant farmer, if it is supported by the minimum evidence demanded by law, is final and conclusive and cannot be reversed by the appellate tribunals except for compelling reasons. Inversely, a factual conclusion by the appellate court that the evidence fails to establish the status of a person as a tenant farmer is conclusive on the parties and carries even more weight when said court affirms the factual findings of the trial court. In the case at bar, however, we find there are such compelling reasons for this Court to apply the exception of non-conclusiveness of the factual findings of the trial and appellate courts on the ground that the "findings of fact of both courts is premised on the supposed absence of evidence but is in actuality contradicted by evidence on record."9 [Villanueva vs. Court of Appeals, 267 SCRA 89 (1997)] A careful examination of the record reveals that, indeed, both the trial court and the appellate court overlooked and disregarded the overwhelming evidence in favor of RUPA and instead relied mainly on the statements made in the decision in another case. olanski

A tenant is defined under Section 5 (a) of Republic Act No. 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. Briefly stated, for this relationship to exist, it is necessary that:

Upon proof of the existence of the tenancy relationship, RUPA could avail of the benefits afforded by RA 384411 [An Act To Ordain The Agricultural Land Reform Code And To Institute Land Reforms In The Philippines, Including The Abolition Of Tenancy And The Channeling Of Capital Into Industry, Provide For the Necessary Implementing Agencies, Appropriate Funds Therefor And For Other Purposes.], as amended, particularly, Section 12 thereof which reads:

As correctly pointed out by the CA, this right of redemption is validly exercised upon compliance with the following requirements: a) the redemptioner must be an agricultural lessee or share tenant; b) the land must have been sold by the owner to a third party without prior written notice of the sale given to the lessee or lessees and the DAR in accordance with sec. 11, RA 3844, as amended; c) only the area cultivated by the agricultural lessee may be redeemed; d)the right of redemption must be exercised within 180 days from notice; and e) there must be an actual tender or valid consignation of the entire amount which is the reasonable price of the land sought to be redeemed.12 [Citing Gumaru vs. Agub, et. al, CA-GR No. 07617-R, dated April 28, 1978, see rollo, p. 15.]

However, as aforesaid, the CA failed to take into account the other material evidence on record to arrive at its finding that RUPA was not a tenant-farmer. The decision dated March 11, 1985 relied upon by the CA stemmed from Criminal Case No. 532-U for Malicious Mischief which was instituted upon a complaint filed by RUPA against one Mariano Luzong who happens to be the son-in-law of SALIPOT. According to RUPA, Mariano Luzong destroyed the banana and cassava plants in his farm in Armenia, Uson, Masbate. It was stated in the decision that RUPA "claimed that he is the administrator of the five parcels of land owned by Patrocinio Lim in Armenia, Uson, Masbate"13 [Original Records, Exhibit 6, p. 56.]; and that the "prosecution witnesses, Pablito Arnilla, and Antonieta Bongasan, the alleged eyewitnesses to the destruction of the banana plants and cassava plants admitted being hired laborers of Gerardo Rupa in tilling the latter’s farm."14 [Ibid.]

It is believed that the statements in the said decision are not sufficient basis to overcome the rights of RUPA as provided in the Constitution and agrarian statutes and upheld by this Court. The essence of agricultural tenancy lies in the establishment of owner-cultivatorship and the economic family-size farm as the basis of Philippine agriculture, and as a consequence, divert landlord capital in agriculture to industrial development.15 [Section 2 of Republic Act No. 3844, as amended.]

The statements made in the decision that "[Rupa] claimed that he was made administrator by the Lim spouses of their five (5) parcels of land in Armenia, Uson, Masbate" and that the "prosecution witnesses in that case, namely, Pablito Arnilla and Antonieta Rongasan admitted that they were hired laborers of Rupa in tilling the land in question" should not have been relied upon by the CA to conclusively disprove the tenancy relationship.

First of all, we must look at the context in which these statements were made. The admission made by RUPA as stated in the decision was made, as mentioned earlier, in a criminal case for malicious mischief which RUPA filed against one Mariano Luzong, son-in-law of SALIPOT, on the ground that the latter destroyed the banana and cassava plants growing in RUPA’s farm. Said statement was apparently made to prove RUPA’s standing to file the complaint and to prove how he could have witnessed the destruction made by said person. Jksm

Second, in claiming that he was administrator of the property, RUPA, a farmer of limited education must have used the word "administrator" in a loose sense to mean one taking care of a certain piece of property by clearing and planting on the same. As aptly pointed out by counsel for RUPA during the trial, with no objection from the counsel of SALIPOT, "under common usage in the locality, the term administrator is used interchangeably with tenancy.16 [TSN dated March 11, 1985, p. 4.]

Third, the CA did not bother to explain its finding on the "inherent incompatibility" between being a tenant-farmer and an administrator or overseer. According to RUPA, he was tenant of one parcel of land belonging to the Lim spouses and administrator or overseer of the other four parcels of land owned by the said spouses. SALIPOT and his witnesses had interchangeably claimed RUPA to be an overseer and a copra agent or copra buyer. As overseer, he may have been receiving a fixed salary. As tenant under our legal definition, he may have been sharing the harvests with the landowner. This may well lead a person to find an incompatibility between the two. However, one could in fact be overseer of a parcel of land, supervising the laborers therein and receiving a fixed salary for one’s services, and at the same time, act as tenant farmer in another landholding.

Fourth, the testimony of the prosecution witnesses that they were "hired laborers" should not have been given significant weight by the CA. The rule is well-settled that the rights of a person cannot be prejudiced by the declaration, act or omission of another, except as provided by the Rules of Court in cases of admission by a co-partner, agent, conspirator and privies. The said witnesses do not come under any of these exceptions.17 [Section 28, Rule 130, Rules of Court, as amended.]

As regards the certificate issued by the Office of the Treasurer to the effect that RUPA was a copra buyer from May 19, 1978 to October 10, 1979, we find that this does not necessarily rule out RUPA’s claim that he was tenant-farmer since 1962. RUPA has satisfactorily explained that "pursuing two or three lines of work is nothing new. In coconut lands, harvest seasons come far and in between, and the tenant can always engage in the business of copra-buying in the interim."18 [Rollo, p. 9.] Moreover, the dates indicated therein cover only a short period of time as against RUPA’s claim that he was tenant from 1963 until his ejectment sometime in 1981. Chief

We are therefore constrained to overturn the appealed judgment insofar as it ruled that the records do not establish RUPA’S status as an agricultural tenant. Indeed, the testimony of RUPA and his witnesses in open court, in our view, had not been convincingly rebutted and we have no reason to doubt the veracity of the testimonies of his witnesses. Certainly, the passing statements contained in the decision in the criminal case for malicious mischief cannot overcome the evidentiary value of the testimonies of said witnesses. A meticulous review of the record would have found overwhelming evidence in favor of RUPA. A scrutiny of the entire evidence on hand would be in line with the State’s policy of achieving a dignified existence for the small farmers free from pernicious institutional restraints and practices.19 [Sec. 2[2], Code of Agrarian Reforms.]

RUPA’s evidence to prove the tenancy relationship consisted of his own testimony and those of his witnesses Jose V. Seraspi, Gregorio Mortal, Hermogenes Mahinay and Alfredo Patotoy. The foregoing evidence comes from persons actually residing where the land is located from whose declarations it appears that RUPA has physically possessed the landholding continuously from 1963 until he was ejected from it. RUPA lives on the landholding and he has built a house next to the copra kiln. It has also been established that RUPA has cultivated the land from the time he has taken possession thereof in 1963, although there may have already been existing coconut trees in the landholding. At this point it is apt to quote the disquisition of this Court in Guerrero vs. Court of Appeals20 [142 SCRA 136 (1986) citing Delos Reyes vs. Espinelli, 30 SCRA 574 and Marcelo vs. de Leon, 105 Phil.1175)] regarding the cultivation of coconuts, to wit:

The fact that RUPA has been planting coconut seedlings and minor crops in the vacant portions of the subject land as well as cleaning and gathering coconuts to process them into copra is borne out by the records. Further indicating the tenancy relationship between the landlord and RUPA is their agreement to share 50/50. The sharing arrangement taken together with other factors characteristic of tenancy shown to be present in the case at bar, strengthens the claim of RUPA that indeed, he is a tenant. Esm

On the other hand, the stand of SALIPOT that RUPA was merely a copra agent and overseer and that one Hermogenes Mahinay was the tenant of the Lims from 1963 up to the time he bought the subject land in 1979 is belied by the records. SALIPOT offered in evidence his own testimony and those of witnesses Arnulfo Morata, Felipe Gelordo, Mariano Luzong and Vicente Lim, Sr. to support this version.

SALIPOT testified that he is a farmer and resident of Armenia, Uson, Masbate; that Hermogenes Mahinay was the tenant of the Lims since 1962 until 1979 when he purchased the property; that he bought the property in July 29 or 30, 1979; that two deeds of sale were executed over the same property, one in July 30, 1979 and another in January 1981, because he had not yet paid in full the purchase price; that RUPA was the copra agent of Lim.21 [TSN dated March 11, 1982, pp. 3-36.]

Vicente Lim, Sr. corroborated the said testimony of SALIPOT.22 [TSN dated March 11, 1985, pp. 11-21.] Arnulfo Morata (MORATA) and Felipe Gelordo (GELORDO) testified that they were both farmers residing in Armenia, Uson, Masbate; both stated that it was Hermogenes Mahinay who tenanted the landholding; and that RUPA was merely the overseer of the same. According to MORATA he always passes by the subject landholding because his own land is at the far end of the area but he never saw RUPA in the subject land.23 [TSN dated January 11, 1985, pp. 2-8.] However, on cross-examination, he stated that the first time he saw Mahinay in the land in question was only in 1979.24 [TSN dated January 11, 1985, pp. 6-8.] On the other hand, according to GELORDO, he is familiar with the facts of the case as he stays on a parcel of land opposite the subject landholding. He stated that he did not see RUPA occupy the subject landholding.25 [TSN dated February 22, 1985, pp. 2-8.] But on cross-examination, GELORDO admitted that the matters he was testifying on were told to him by SALIPOT.26 [TSN dated February 22, 1985, pp. 9-16.] Esmsc

It is odd that MORATA and GELORDO testified that they never saw RUPA in the subject landholding of which SALIPOT alleged RUPA to have been an administrator. Even more strange is the testimony of MORATA that he only saw Mahinay in the subject land sometime in 1979 contrary to SALIPOT’s claim that he has been tenant of the subject land since 1962. Further, GELORDO admitted that he was testifying on matters as told to him by SALIPOT. The testimonies of MORATA and GELORDO are clearly flawed and detract from their credibility.

Over and above the foregoing, RUPA has successfully rebutted the claims of SALIPOT in presenting Hermogenes Mahinay himself in his favor. Hermogenes Mahinay himself testified that he is a farmer and resident of Malamag, Pio V. Corpus, Masbate and presently, Armenia, Uson, Masbate; that he knows the parties in the case; that he transferred from Pio V. Corpus to Armenia, Uson in 1972; that RUPA was the one working the subject land; that he stayed in the land in question for less than a year; that he was never a tenant of the subject land from 1962 to 1979 contrary to the claim of SALIPOT.27 [TSN dated March 11, 1985, pp. 26-32.] On cross-examination, he reiterated that he was never a tenant but RUPA was; that he executed an affidavit that RUPA was never a tenant in the land in question without reading the same because he doesn't know how to read and write; that he affixed his thumb mark anyway because he was told that the contents were good; that he was just told to affix his thumb mark.28 [TSN dated March 11, 1985, pp. 32-34.] There is no reason to doubt the credibility of this witness who has candidly and straightforwardly denied ever being a tenant of the subject land. Esmmis

We are also inclined to believe the position of RUPA that he came to know of the sale of the land to SALIPOT only on February 16, 1981 as evidenced by a letter of the same date of the former landowner Patrocenia Yu Lim to RUPA informing the latter to give up possession of the land to SALIPOT as the land had already been sold to the latter.29 [Exhibit "B"; Rollo, p. 58.] Thus, the action for redemption commenced on March 26, 1981 was filed within the six-month reglementary period. SALIPOT is likewise estopped from claiming that the true purchase price is P15,000.00 instead of P5,000.00 as reflected in the deed of sale, which was admittedly done to lower the tax liabilities of the parties to the sale.30 [TSN adted March 11, 1985, pp.11-20.] We cannot countenance this act of misstating the true purchase price as a means to circumvent our tax laws. Hence, SALIPOT cannot claim that the amount of P5,000.00 consignated by RUPA is inadequate for purposes of exercising the right of redemption.

RUPA has since passed away and the right now devolves to his heirs, as the right to redeem is a property right which is transmissible to the heirs.31 [Art. 781. The inheritance of a person includes not only the property and the transmissible rights and obligations existing at the time of his death, but also those which have accrued thereto since the opening of the succession. (Civil Code of the Philippines)] The issue on damages and share of harvests was not raised before the CA for failure of RUPA to file his memorandum, hence, we cannot pass upon the same. It is well-settled that a party is not permitted to raise before the Supreme Court an issue which he did not raise in the Court of Appeals.32 [Republic Resources and Development Corporation vs. Court of Appeals, 203 SCRA 164 (1991)]

WHEREFORE, the petition is GRANTED. The assailed decision of the Court of Appeals, which affirmed that of the Regional Trial Court, is REVERSED and SET ASIDE.

Melo, (Chairman), Vitug, Panganiban, and Purisima, JJ., concur.