Hidalgo vs. Hidalgo, 33 SCRA 105, May 29, 1970 PDF

2/17/2017 SUPREME COURT REPORTS ANNOTATED VOLUME 033
VOL. 33, MAY 29, 1970 105

Hidalgo vs. Hidalgo
No. L-25326. May 29, 1970.
IGMIDIO HIDALGO and MARTINA ROSALES, petitioners, vs.

PoLICARPIO HlDALGO, SERGIO DlMAANO, MARIA ARDE,
SATURNINO HlDALGO, BERNARDINA MARQUEZ, VlCENTE
DlMAANO, ARCADIA DIMAANO, TEODULA DIMAANO,
THE REGISTER OF DEEDS and THE PROVINCIAL ASSESSOR
OF THE PROVINCE OF BATANGAS, respondents.
No. L-25327. May 29, 1970.
HILARIO AGUILA and ADELA HIDALGO, petitioners, vs.

POLICARPIO HIDALGO, SERGIO DIMAANO, MARIA ARDE,
SATURNINO HIDALGO, BERNARDINA MARQUEZ, VICENTE
DIMAANO, ARCADIA DIMAANO, TEODULA DIMAANO,
THE REGISTER OF DEEDS and THE PROVINCIAL ASSESSOR
OF THE PROVINCE OF BATANGAS, respondents.
Agricultural Land Reform Code; Code abolishes agricultural share

tenancy.—The very essence of the Agricultural Land Reform Code is the
abolition of agricultural share tenancy as proclaimed in its title. Section 4 of
the Code expressly-outlaws agricultural share tenancy as "contrary to public
policy." section 2 of the Code expressly declares it to be the policy of the
State to "establish owner cultivatorship and the economic
106
106 SUPREME COURT REPORTS ANNOTATED
Hidalgo vs. Hidalgo
family-size farm as the basis of Philippine agriculture and, as a

consequence, divert landlord capital in agriculture to industrial
development; to achieve a dignified existence for the small farmers free
from pernicious institutional restraints and practices; x x x and to make the
http://www.central.com.ph/sfsreader/session/0000015a4a2b0b27db2d00ef003600fb002c009e/t/?o=False 1/16
small farmers more independent, self-reliant and responsible citizens, and a

source of strength in our democratic society."
Same; Farmer's right of pre-emption to buy the land he cultivates;
Reason.—The Land Reform Code forges by operation of law the farmer's
pre-emptive right to buy the land he cultivates under section 11 of the Code
as well as the right to redeem the land, if sold to a third person without his
knowledge, under section 12 of the Code. This is an essential and
indispensable mandate of the Code to implement the State's policy of
establishing ownership-cultivatorship and to achieve a dignified and self-
reliant existence for the small farmers that would make them a pillar of
strength of our Republic. Aside from expropriation by the Land Authority of
private agricultural land for resale in economic family-size farm units "to
bona fide tenants, occupants and qualified farmers," the .purchase by
farmers of the lands cultivated by them, when the owner decides to sell the
same—through the rights of preemption and redemption—are the only
means prescribed by the Code to achieve the declared policy of the State.
Statutory construction; Spirit or intent must prevail over Utter of the
law.—Where the true intent of the law is clear such intent or spirit must
prevail over the letter thereof, for whatever is within the spirit of a statute is
within the statute, since adherence to the letter would result in absurdity,
injustice and contradictions and would defeat the plain and vital purpose of
the statute.
Agricultural Land Reform Code; Right of pre-emption; Basbas v.
Entena distinguished with case at bar.—ln Basbas v. Entena, the farmer's
right of redemption was not granted because he had yet no funds to redeem
the property and had merely applied for them to the Land Authority which
was not yet operating in the locality. In the case at bar, the farmer's
possession of funds and compliance with the requirements of redemption
are not questioned,
PETITIONS for review from the decisions of the Court of Agrarian

Relations.
The facts are stated in the opinion of the Court.
Jose O. Lara for petitioners.
Pedro Panganiban y Tolentino for respondents.
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VOL. 33, MAY 29, 1970 107

Hidalgo vs. Hidalgo
TEEHANKEE, J.:
Two petitions for review 01 decisions of the Court of Agrarian

Relations dismissing petitioners' actions as share tenants for the
enforcement of the right to redeem agricultural lands, under the
provisions of section 12 of the Agricultural Land Reform Code. As
the same issue of law is involved and the original landowner and
vendees in both cases are the same, the two cases are herein jointly
decided.
Respondent-vendor Policarpio Hidalgo was until the time of the
execution of the deeds of sale on September 27, 1963 and March 2,
1964 in favor of his seven above-named private co-respondents, the
owner of the 22,876-square meter and 7,638-square meter
agricultural parcels of land situated in Lumil, San Jose, Batangas,
described in the decisions under review.
In Case L-25326, respondent-vendor sold the 22,876square meter
parcel of land, together with two other parcels of land for P4,000.00.
Petitioners-spouses Igmidio Hidalgo and Martina Rosales, as tenants
thereof, alleging that the parcel worked by them as tenants is fairly
worth P1,500.00, "taking into account the respective areas,
productivities, accessibilities, and assessed values of three lots, seek
by way of redemption the execution of a deed of sale for the same
1
amount of P1,500.00 by respondents-vendees in their favor.
In Case L-25327, respondent-vendor sold the 7,638square meter
parcel of land for P750.00, and petitioners- petitionersspouses
Hilario Aguila and Adela Hidalgo as tenants thereof, seek by way of
redemption the execution of a deed of sale for the same price of
P750.00 by respondentsvendees in their favor.
______________
1 Per answer of respondents and the parties' stipulation of facts, respondents-

vendees Saturnino Hidalgo and Bernardina Marquez, together with petitioners-
spouses Igmidio Hidalgo and Martina Rosales in Case L-25326 and -petitioners-
spouses Hilario Aguila and Adela Hidalgo in Case L-25327 compose the three sets of
tenants working on their lands.
108

Hidalgo vs. Hidalgo
As stated in the decisions under review, since the parties stipulated

on the facts in both cases, petitionerstenants have for several years
been working on the lands as share tenants. No 90-day notice of
intention to sell the lands for the exercise of the right of pre-emption
prescribed by section 11 of the Agricultural Land Reform Code
(Republic Act No. 3844, enacted on August 8, 1963) was given by
respondent-vendor to petitioners-tenants. Subsequently, the deeds of
sale executed by respondentvendor were registered by respondents
register of deeds and provincial assessor of Batangas in the records
of their respective offices notwithstanding the non-execution by
respondent-vendor of 2
the affidavit required by section 13 of the
Land Reform Code. The actions for redemption were timely filed
on March 26, 1965 by petitioners-tenants within the two-year

prescriptive period from registration of the sale, prescribed by
section 12 of the said Code.
The agrarian court rendered on July 19, 1965 two identical
decisions dismissing the petitions for redemption/
It correctly focused on the sole issue of law as follows: "(T)he
only issue in this case is whether or not plaintiffs, as share tenants,
are entitled to redeem the parcel of land they are working from the
purchasers thereof, where no notice was previously given to them by
the vendor, who was their landholder, of the latter's intention to sell
the property and where the vendor did not execute the affidavit
required by Sec. 13 of Republic Act No. 3844 before the registration
of the deed of sale, In other words, is the right of redemption granted
by Sec. 12 of Republic Act No. 3844 applicable to share tenants?"
But proceeding from several erroneous assumptions and
premises, it arrived at its erroneous conclusion that the
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2 "SEC. 13. Affidavit Required in Sale of Land Subject to Right of Pre-emption.—

No deed of sale of agricultural land under cultivation by an agricultural lessee or
lessees shall be recorded in the Registry of Property unless accompanied by an
affidavit of the vendor that he has given the written notice required in Section eleven
of this Chapter or 'that the land is not worked by an agricultural lessee." (R.A. No.
3844.)
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VOL. 33, MAY 29, 1970 109

Hidalgo vs. Hidalgo
right of redemption granted by section 12 of the Land Reform Code

is available to leasehold tenants only but not to share tenants, and
thus dismissed the petitions: "(S)ec. 12 of Republic Act No. 3844,
which comes under Chapter I of said Act under the heading
'Agricultural Leasehold System,' roads as follows:
" 'SEC. 12. Lessee's Right of Redemption.—In case the landholding is sold
to a third person without the knowledge of the agricultural lessee, the latter
shall have the right to redeem the same at a reasonable price and
consideration: Provided: further, That where there are two or more
agricultural lessees, each shall be entitled to said right of redemption only to
the.extent of the area actually cultivated by him. The right of redemption
under this Section may be exercised within two years from the registration
of the sale, and shall have priority over any other right of legal redemption.'
"The systems of agricultural tenancy recognized in this Jurisdiction are
share tenancy and leasehold tenancy. (Sec. 4, Republic Act No. 1199; Sec.
4, Republic Act No. 3844). A share tenant is altogether different from a
leasehold tenant and their respective rights and obligations are not co-
extensive or co-equal. (See Secs. 22 to 41, inclusive, and Secs, 42 to 48,
inclusive, of Republic Act No, 1199: see also Secs; 4 to 38, inclusive, of
Republic Act Act No. 3844).
"It is our considered view that the right of redemption granted by

Section 12 of Republic Act No. 3844 is applicable- to leasehold
tenants only, but not to share tenants, because said provision of law
clearly, definitely, and unequivocally grants said right to the
'agricultural lessee,' and to nobody- else. In enacting the Agricultural
Land -Reform Code, Congress was fully aware of the existence of
share tenancy and in fact provided for the abolition of the
agricultural share tenancy system. (Sec. 4,. Republic Act No. 3844.)
If it were the intention of Congress to grant the right of redemption
to share tenants, it would have unmistakably and unequivocally
done so. We cannot extend said right to share tenants through
judicial legislation, wherever our sympathies may lie."
110

Hidalgo vs. Hidalgo
The agrarian court fell into several erroneous assumptions and

premises in holding that agricultural share tenancy remains
recognized in this jurisdiction; that "a share tenant is altogether
different from a leasehold tenant and their respective rights and
obligations are not coextensive or co-equal"; and that the right of
redemption granted by section 12 of the Land Reform Code "is
applicable to leasehold tenants only, but not to share tenants,
because said provision of law clearly, definitely, and unequivocally
grants said right to the 'agricultural lessee' and to nobody -else."
1. The very essence of the Agricultural Land Reform Code is the
abolition of agricultural share tenancy as proclaimed in its title.
Section 4 of the Code expressly outlaws agricultural share3
tenancy
as "contrary to public. policy" and decrees its abolition. Section 2 of
the Code expressly declares it to be the policy of the State, inter
alia, "to establish owner cultivatorship and the economic family-size
farm as the basis of Philippine agriculture
_______________
3 "SEC. 4. Abolition of Agricultural Share Tenancy.—Agricultural share tenancy,

as herein defined, is hereby declared to be contrary to public policy and shall be
abolished: Provided, That existing share tenancy contracts may continue in force and
effect in any region or locality, to be governed in the meantime by the pertinent
provisions of Republic Act Numbered Eleven hundred and ninety-nine, as amended,
until the end of the agricultural year when the National Land Reform Council
proclaims that all the government machineries and agencies in that region or locality
relating to leasehold envisioned in this Code are operating, unless such contracts
provide for a shorter period or the tenant sooner exercises his option to elect the
leasehold system: Provided, further, That in order not to jeopardize international
commitments, lands devoted to crops covered by marketing allotments shall be made
the subject of a separate proclamation that adequate provisions, such as the
organization of cooperatives, marketing agreements, or other similar workable
arrangements, have been made to insure officient management on all matters
requiring synchronization of the agricultural with the processing phases of such crops:
Provided, furthermore, That where the agricultural share tenancy contract has ceased
to be operative by virtue of this Code, or where such a tenancy contract has been
entered into in violation of the provisions of this Code and is, therefore,
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Hidalgo vs. Hidalgo
and, as a consequence, divert landlord capital in agriculture to

industrial development; to achieve a dignified existence for the small
farmers free from pernicious institutional restraints and practices; x
x x and to make the small farmers more independent, self-reliant and
responsible
4
citizens, and a source of strength in our democratic
society," It was error, therefore, for the agrarian court to state the
premise after the Land Reform Code had already been enacted, that
"the systems of agricultural tenancy recognized in this jurisdiction
are share tenancy and leasehold tenancy." A more accurate
statement of the premise is that' based on the transitory provision in
the first proviso of section 4 of the Code, i.e. that existing share
tenancy contracts are allowed to continue temporarily in force and
effect, notwithstanding their express abolition, until whichever of
the following events occurs earlier: (a) the end of the agricultural
year when the National Land Reform Council makes the
proclamation declaring the region or locality a land reform area; or
(b) the shorter period provided in the share tenancy contracts
expires; or (c) the share tenant sooner exercises his option to elect
the leasehold system.
In anticipation of the expiration of share tenancy contracts—
whether by contractual stipulation or the tenant's exercise of his
option to elect the leasehold system instead
_______________
null and void, and the tenant continues in possession of the land for cultivation,
there shall be presumed to exist a leasehold relationship under the provisions of this
Code, without prejudice to the right of the landowner and the former tenant to enter
into any other lawful contract in relation to the land formerly under tenancy contract,
as long as in the interim the security of tenure of the f ormer tenant under Republic
Act Numbered Eleven hundred and ninety-nine, as amended, and as provided in this
Code, is not impaired: Provided, finally, That if a lawful leasehold tenancy contract
was entered into prior to the effectivity of this Code, the rights and obligations arising
therefrom shall continue to subsist until modified by the parties in accordance with
the provisions of this Code. R.A. 3844, italics supplied.
4 Section 2, pars. (1), (2), and (6), R.A. 3844; italics supplied.
112

Hidalgo vs. Hidalgo
or by virtue of their nullity—occuring before the proclamation of the

locality as a land reform area, the same section 4 has further
declared in the third proviso thereof that in such event; the tenant
shall continue in possession of the land for cultivation and "there
shall be presumed to exist a leasehold relationship under the
provisions of this Code."
2. The foregoing exposes the error of the agrarian court's
corollary premise that "a share tenant is altogether different from a
leasehold tenant" The agrarian court's dictum that "their respective
rights and obligations are not co-extensive or co-equal "refer to their
contractual relations with the landowner, with respect to the
contributions
5
given, management, division or payment of the
produce.
But the Land Reform Code forges by operation of law, between
the landowner and the farmer—be a leasehold tenant or temporarily
a share tenant—a vinculum juris with certain vital juridical
consequences, such as security of tenure of the tenant 'and the
tenant's right to continue in possession of the land he works despite
the expiration of the contract or the sale or transf er of the land to
third persons, and now, more basically, the farmer's pre-emptive
right to buy the land he cultivates under section 11 of
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5 "(2) 'Agricultural lessee' means a person who, by 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, for a
price certain in money or in produce or both. It is distinguished from civil law lessee
as understood in the Civil Code of the Philippines." Sec. 166, R.A. 3844;
"(25) 'Share tenancy' as used in this Code means ,the relationship which exists
whenever two persons agree on a joint undertaking for agricultural production
wherein one party furnishes the land and the other his labor; with either or both
contributing any one or several of the items of production, the tenant cultivating the
land personally with the aid of labor available from members of his immediate farm
household, and the produce thereof to be divided between the landholder and the
tenant." Idem.
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VOL. 33, MAY 29, 1970 113

Hidalgo vs. Hidalgo
6
the Code as well as the right to redeem the land, if sold to a third
person without his knowledge, under section 12 of the Code.
This is an essential and indispensable mandate of the Code to
implement the State's policy of establishing ownercultivatorship and
to achieve a dignified and self-reliant existence for the small farmers
that would make them a pillar of strength of our Republic. Aside
from expropriation by the Land Authority of private agricultural
land for resale in economic family-size 7farm units "to bona fide
tenants, occupants and qualified farmers," the purchase by f armers
of the lands cultivated by them, when the owner decides to sell the
same—through rights of pre-emption and redemption—are the only
means prescribed by the Code to achieve the declared policy of the
State.
3. The agrarian court therefore facilely let itself fall into the error
of concluding that the right of redemption (as well as necessarily the
right of pre-emption) imposed by the Code is available to leasehold
tenants only and excludes share tenants for the literal reason that the
Code grants said rights only to the "agricultural lessee and to
nobody else." For one, it immediately comes to mind that the Code
did not mention tenants, whether leasehold or share tenants, because
it outlaws share tenancy and envisions the agricultural leasehold
system as its replace-
_______________
6 "Sec. 11. Lessee's Right of Pre-emption.—In case the agricultural lessor decides
to sell the landholding, the agricultural lessee shall have the preferential right to buy
the same under reasonable terms and conditions: Provided, That the entire
landholding offered for sale must be pre-empted by the Land Authority if the
landowner so desires, unless the majority of the leasees object to such acquisition:
Provided, further, That where there are two or more agricultural lessees, each shall be
entitled to said preferential right only to the extent of the area actually cultivated by
him. The right of pre-emption under this Section may be exercised within ninety days
from notice in writing, which shall be served by the owner on all lessees affected."
R.A. 3844, italics supplied.
7 Section Section 51, R.A. 3844.
114

Hidalgo vs. Hidalgo
ment Thus, Chapter I of the Code, comprising sections 4 to 38.

extensively deals with the establishment of "agricultural leasehold
relation," defines the parties thereto and the rights and obligations of
the "agricultural lessor" and of the "agricultural lessee" (without
the slightest mention of leasehold tenants) and the statutory
consideration or rental for the leasehold to be paid by the lessee,
There is a studied omission in the Code of the use of the term tenant
in deference to the "abolition of tenancy" as proclaimed in the very
title of the Code, and the elevation of the tenant's status to that of
lessee.
Then, the terms "agricultural lessor" and "agricultural lessee" are
consistently used throughout the Chapter and carried over the
particular sections (11 and 12) on preemption and redemption. The
agrarian court's literal construction would wreak havoc on and
defeat the proclaimed and announced legislative intent and policy of
the State of establishing owner-cultivatorship for the farmers, who
invariably were all share tenants before the enactment of the Code
and whom the Code would now uplift to the status of lessees,
A graphic instance of this fallacy would be found in section 11
providing that "In case the agricultural lessor decides to sell the
landholding the agricultural lessee shall have the preferential right
to buy the same under reasonable terms and conditions." It will be
seen that the term "agricultural lessor" is here used interchangeably
with the term "landowner"; which conflicts with the Code's
definition of "agricultural lessor" to mean "a person natural or
juridical, who, either as owner, civil law lessee, usufructuary, or
legal possessor, lets or grants
8
to another the cultivation and use of
his land for a price certain." Obviously, the Code precisely referred
to the "agricultural lessor (who) decides to sell the landholding,"
when it could have more precisely referred to the "landowner," who
alone as such, rather than a civil law lessee, usufructuary or legal
possessor, could sell the landholding.
_______________
8 Sec. 166, par. (3), R.A. 3844.
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VOL. 33, MAY 29, 1970 115

Hidalgo vs. Hidalgo
but it certainly cannot be logically contended that the imprecision

should defeat the clear spirit and intent of the provision.
4. We have, here, then a case of where the true intent of the law is
clear that calls for the application of the cardinal rule of statutory
construction that such intent or spirit must prevail over the letter
thereof, for whatever is within the spirit of a statute is within the
statute, since adherence to the letter would result in absurdity,

injustice and contradictions and would defeat the plain and vital
purpose of the statute.
Section 11 of the Code providing for the "agricultural lessee's"
preferential right to buy the land he cultivates provides expressly
that "the entire landholding offered for sale must be pre-empted by
the Land Authority if the landowner so desires, unless the majority
of the lessees object to such acquisition," presumably for being
beyond their capabilities, Taken together with the provisions of
Chapter III of the Code on the organization and functions of the
Land Authority and Chapter VII on the Land Project Administration
and the creation and functions of the National Land Reform Council,
(in which chapters the legislature obviously was not laboring under
the inhibition of ref erring to the term tenants as it was in Chapter I
establishing the agricultural
9
leasehold system and decreeing the
abolition of share tenancy, the Code's intent, policy and objective to
give both agricultural lessees and farmers who transitionally
continue to be share tenants notwithstanding the Code's enactment,
the same priority and preferential rights over the lands under their
cultivation, in the event of acquisition of the lands, by expropriation
or voluntary sale, for distribution or resale that may be initiated by
the Land Authority or the National Land Reform Council, are
clearly and expressly stated.
Thus Chapter III, section 51 of the Code decrees it the
_______________
9 Supra, paragraph 3.
116

Hidalgo vs. Hidalgo
responsibility of the Land Authority "(1) To initiate and prosecute

expropriation proceedings for the acquisition of private agricultural
lands as defined in Section one hundred sixty-six of chapter XI of
this Code for the purpose of subdivision into economic family—size
farm units and resale of said farm units to bona fide tenants,
occupants and qualified farmers x x x and "(2) To help bona fide
farmers without lands of agricultural owner-cultivators of
uneconomic-size farms to acquire and own economic familysize
farm units x x x."
Similarly, Chapter VII, section 128 of the Code, in enjoining the
National Land Reform Council to formulate the necessary rules and
regulations to implement the Code's provisions for selection of
agricultural land to be acquired and distributed and of the
beneficiaries of the family farms, ordains the giving of the same
priority "to the actual occupants personally cultivating the land

either as agricultural lessees or otherwise with respect to the area
under their cultivation."
5. It would certainly result in absurdity, contradictions and
injustice if a share tenant would be denied the rights of pre-emption
and redemption which he seeks to exercise on his own resources,
notwithstanding that the National Land Reform Council has not yet
proclaimed that all the government machineries and agencies in the
region or locality envisioned in the Code are operating—which
machineries and .agencies, particularly, the Land Bank were
precisely created "to finance the acquisition by the Government of
landed -estates for division and resale to small landholders, as well
as the purchase
10
of the landholding by the agricultural lessee from the
landowner." The non-operation in the interval of the Land Bank
and the government machineries and agencies in the region which
are envisioned in the Code to assist the share tenant in shedding off
the yoke of tenancy and afford him the financial assistance to
exercise his option of electing the leasehold system and his
preferential right of purchasing
_______________
10 Sec. 74, R.A. 3844.
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VOL. 33, MAY 29, 1970 117

Hidalgo vs. Hidalgo
the land cultivated by him could not possibly have been intended by
Congress to prevent the exercise of any of these vital rights by a
share tenant who is able to do so, e.g. to purchase the land, on his
own and without government assistance. It would be absurd and
unjust that while the government is unable to render such assistance,
the share tenant would be deemed deprived of the very rights
granted him by the Code which he is in a position to exercise even
without government assistance.
6. Herein
11
lies the distinction between the present case and Basbas
vs. Entena where the Court upheld the agrarian court's dismissal of
the therein tenant's action to redeem the landholding sold to a third
party by virtue of the tenant's failure to tender payment or consign
the purchase price of the property. There, the tenant-redemptioner
was shown by the evidence to have no funds and had merely applied
for them to the Land Authority which was not yet operating in the
locality and hence, the Court held that no part of the Code 'indicates
or even hints that the 2-year redemption period will not commence
to run (indefinitely) until the tenant obtains financing from the Land
Bank, or stops the tenant from sccuring redemption funds from some
12
other source." In the present case, the petitioners-tenants'
12
other source." In the present case, the petitioners-tenants'
possession of funds and compliance with the requirements of
redemption are not questioned, the case having been submitted and
decided on the sole legal issue of the right of redemption being
available to them as share tenants. The clear and logical implication
of Basbas is where the tenant has 'his own resources or secures
redemption funds from sources other than the Land Bank or
government agencies under the Code, the fact that the locality has
not been proclaimed a land reform area and that such government
machineries and agencies are not operating therein is of no relevance
and cannot prejudice the "tenant's rights under the Code to redeem
the landholding.
_______________
11 L-26255, June 30, 969; 28 SCRA 660,

12 Id., Italics and notes in parenthesis supplied.
118

Hidalgo vs. Hidalgo
7. Even from the landowner's practical and equitable viewpoint, the

landowner is not prejudiced in the least by recognizing the share
tenant's right of redemption. The landowner, having decided to sell
his land, has gotten his price therefor from his vendees, (The same
holds true in case of the tenant's exercise of the pre-emptive right by
the tenant who is called upon to pay the landowner the price, if
reasonable, within ninety days from the landowner's written notice.)
As for the vendees, neither are they prejudiced for they will get back
from the tenantredemptioner the price that they paid the vendor, if
reasonable, since the Code grants the agricultural lessee or tenant the
top priority of redemption of the landholding cultivated by him and
expressly decrees that the same "shall have priority over any other
right of legal redemption," In the absence of any provision in the
Code as to manner of and amounts payable on redemption, the
pertinent provisions of the Civil Code apply in a suppletory
13
character. Hence, the vendees would be entitled to receive from the
redemptioners the amount of their purchase besides "(1) the
expenses of the contract, and any other legitimate payments made by
reason of the sale; (and) (2) the necessary and useful expenses made
14
on the thing sold."
8. The historical background for the enactment of the Code's
provisions on pre-emption and redemption further strengthens the
15
Court's opinion. It is noted by Dean Montemayor that "(T)his is a
new right which has not been granted to tenants under the
Agricultural Tenancy Act It further bolsters the security of tenure of
the agricultural lessee and further encourages agricultural lessees to

become owner-cultivators.
"In the past, a landlord often ostensibly sold his land being
cultivated by his tenant to another tenant, who in
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13 Art. 18, Civil Code.

14 Art. 1616, Civil Code.
15 Vol. 3, Montemayor's Labor, Agrarian and Social Legislation, 2d Ed, 1967, p.
246.
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VOL. 33, MAY 29, 1970 119

Hidalgo vs. Hidalgo
turn filed a petition for ejectment against the first tenant on the
ground of personal cultivation. While many of such sales were
simulated, there was a formal transfer of title in every case, and the
first tenant was invariably ordered ejected."
There is indication in this case of the same pattern of sale by the
16
landowner to another tenant, in order to effect the ejectment of
petitioners-tenants. This is further bolstered by the fact that the sales
were executed by respondent-vendor on September 27, 1963 and
March 2, 1964 shortly after the enactment on August 8, 1963 of the
Land Reform Code—which furnishes still another reason for
upholding x x x petitioners-tenants' right of redemption, for certainly
a landowner cannot be permitted to defeat the Code's clear intent by
precipitately disposingof his lands, even before the tenant has been
given the time to exercise his newly granted option to elect the new
agricultural leasehold system established by the Code as a
replacement for the share tenancy outlawed by it.
9. Clearly then, the Code intended, as above discussed, to afford
the farmers' who transitionally continued to be share tenants after its
enactment but who inexorably would be agricultural lessees by
virtue of the Code's proclaimed abolition of tenancy, the same
priority and preferential right as those other share tenants, who upon
the enactment of the Code or soon thereafter were earlier converted
by fortuitous circumstance into agricultural lessees, to acquire the
lands under their cultivation in the event of their voluntary sale by
the owner or of their acquisition, by expropriation or otherwise, by
the Land Authority. It then becomes the court's duty to enforce the
intent and will of the Code, for “x x x (I)n fact, the spirit or intention
of a statute prevails over the letter thereof.' (Tañada vs. Cuenco, L-
10520, Feb. 23, 1957, citing 82 C.J.S., p. 526.) A statute 'should be
construed according to its spirit or intention, disregarding as far
_______________
16 Respondents-vendees, the spouses Saturnino Hidalgo and Bernardina Marquez;

see fn. 1.
120

Hidalgo vs. Hidalgo
as necessary, the letter of the law/ (Lopez & Sons, Inc. vs. Court of
Tax Appeals, 100 Phil. 855.) By this, we do not correct the act of the
Legislature, but rather x x x carry out and give due course to 'its
intent.' (Lopez & Sons, Inc. vs. Court of Tax Appeals, 100 Phil. 850)
17
." The Court has consistently held in line with authoritative
principles of statutory construction that it will reject a narrow and
literal interpretation, such as that given by the agrarian court, that
would defeat and frustrate rather 18
than foster and give life to the law's
declared policy and intent Finally, under the established
jurisprudence of the Court, in the interpretation of tenancy and labor
legislation, it will be guided by more than just an inquiry into the
letter of the law as against its spirit and will
19
ultimately resolve grave
doubts in favor of the tenant and worker.
The agrarian court's dismissal of the cases at bar should therefore
be reversed and petitioners-tenants' right to redeem the landholdings
recognised section 12 of the Code.
In Case L-25326, however, the deed of sale executed by
respondent-vendor in favor of respondents-vendees for the price of
P4,000.00 covers three parcels of land, while what is sought to be
redeemed is only the first parcel of land, of 22,876 square meters,
described in the deed. Petitionerstenants' allegation that the
proportionate worth of said parcel "taking into account the
respective areas, productivities, accessibilities and assessed values
of the three
_______________
17 City of Baguio vs. Marcos, L-26100, Feb. 28, 1969; 27 SCRA 342.
18 Automotive Parts & Equipment Co., Inc, vs. Lingad, L-26406, Oct. 31, 1969, 30
SCRA 248; U.P. Bd. of Regents vs. Auditor-General, L-19617, Oct 31, 1069, 30
SCRA 5; and Pagdanganan vs. Galleta, L-23564, Nov, 28, 1969; 30 SCRA 426;
Marcos vs. Castillo, L-29755, Jan. 31, 1969, 26 SCRA 853 and cases cited.
19 Maniego vs. Castelo, 101 'Phil'. 293, (1957); Vda. de Santos vs. Garcia, L-
16894, May 31, 1963, 8 SCRA 194; Quimson vs. de Guzman, L-18240, Jan, 31,
1963, 7 SCRA 158; and Pagdangan vs. Court of Agrarian .Relations, L-13858, 108
Phil. 590 (1960).
121
VOL. 33, MAY 29, 1970 121

Hidalgo vs. Hidalgo
lots," is P1,500.00, was traversed by respondents in their answer, 20

with the claim that "the said land is f airly worth P20,000.00.
While the vendor would be bound by, and cannot claim more than,
the price stated in the deed, and the Code precisely provides that the
farmer shall have "the preferential right to buy the (landholding)
under reasonable terms and conditions" or "redeem the same at a
21
reasonable price and consideration" with a view to affording the
farmer the right to seek judicial assistance and relief to fix such
reasonable price and terms when the landowner places in the notice
to sell or deed an excessive or exorbitant amount in collusion with
the vendee, we note that in this case the deed of sale itself
acknowledged that the selling price of P4,000.00 therein stated was
not the fair price since an additional consideration therein stated was
that the vendees would support the vendor during his lifetime and
take care of him, should he fall ill, and even assumed the expenses
of his burial upon his death:
"Ang halagang P4,000.00 ay hindi kaulat sa tunay na halagan ng mga lupa

subali't ang mga bumili ay may katungkulan na sostentohin ako habang
ako'y nabubuhay, ipaanyo at ipagamot ako kung ako ay may sakit, saka
ipalibing ako kung ako ay mamatay sa kanilang gastos at ito ay isa sa alang
alang o consideracion ng bilihang ito."
Under these circumstances, since the agrarian court did not rule
upon conflicting claims of the parties as to what was the
proportionate worth of the parcel of land in the stated price of
P4,000.00—whether P1,500,00 as claimed by petitioners or a little
bit more, considering the proportionate values of the two other
parcels, but the whole total is not to exceed the stated price of
P4,000.00, since the vendor is bound thereby—and likewise, what
was the additional proportionate worth of the expenses assumed by
the vendees, assuming that petitioners are not willing to assume the
same obligation, the case should be re-
_______________
20 Annex B, Petition.
21 Secs. 11 and 12, R.A. 3844; See Montemayor, op cit. Vol, 3, p. 246.
122

Municipality of Paete vs. National Waterworks and Sewerage
Authority
manded to the agrarian court solely for the purpose of determining

the reasonable price and consideration to be paid by petitioners for
redeeming the landholding, in accordance with these observations.
In Case L-25327, there is no question as to the price of P750.00
paid by the vendees and no additional consideration or -expenses,
unlike in Case L-25326, supra, assumed by the vendees. Hence,
petitioners therein are entitled to redeem the landholding for the
same stated price.
ACCORDINGLY, the decisions appealed from are hereby
reversed, and the petitions to redeem the subject landholdings are
granted.
In Case L-25326, however, the case is remanded to the agrarian
court solely for determining the reasonable price to be paid by
petitioners therein to respondents-vendees for redemption of the
landholding in accordance with the observations hereinabove made.
No pronouncement as to costs.
Concepcion, CJ., Reyes, J.B.L., Dizon, Makalintal, Zaldivar,

Fernando, Barredo and Villamor, JJ., concur.
Castro, J., is on leave.
Decision reversed, petitions granted.
_____________
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2/17/2017 SUPREME COURT REPORTS ANNOTATED VOLUME 033

VOL. 33, MAY 29, 1970 105

No. L-25326. May 29, 1970.

IGMIDIO HIDALGO and MARTINA ROSALES, petitioners, vs.

No. L-25327. May 29, 1970.

HILARIO AGUILA and ADELA HIDALGO, petitioners, vs.

Agricultural Land Reform Code; Code abolishes agricultural share

106 SUPREME COURT REPORTS ANNOTATED

Hidalgo vs. Hidalgo

family-size farm as the basis of Philippine agriculture and, as a

small farmers more independent, self-reliant and responsible citizens, and a

PETITIONS for review from the decisions of the Court of Agrarian

VOL. 33, MAY 29, 1970 107

Two petitions for review 01 decisions of the Court of Agrarian

1 Per answer of respondents and the parties' stipulation of facts, respondents-

108 SUPREME COURT REPORTS ANNOTATED

As stated in the decisions under review, since the parties stipulated

on March 26, 1965 by petitioners-tenants within the two-year

2 "SEC. 13. Afﬁdavit Required in Sale of Land Subject to Right of Pre-emption.—

VOL. 33, MAY 29, 1970 109

right of redemption granted by section 12 of the Land Reform Code

"It is our considered view that the right of redemption granted by

110 SUPREME COURT REPORTS ANNOTATED

The agrarian court fell into several erroneous assumptions and

3 "SEC. 4. Abolition of Agricultural Share Tenancy.—Agricultural share tenancy,

VOL. 33, MAY 29, 1970 111

and, as a consequence, divert landlord capital in agriculture to

112 SUPREME COURT REPORTS ANNOTATED

or by virtue of their nullity—occuring before the proclamation of the

VOL. 33, MAY 29, 1970 113

114 SUPREME COURT REPORTS ANNOTATED

ment Thus, Chapter I of the Code, comprising sections 4 to 38.

8 Sec. 166, par. (3), R.A. 3844.

VOL. 33, MAY 29, 1970 115

but it certainly cannot be logically contended that the imprecision

statute, since adherence to the letter would result in absurdity,

116 SUPREME COURT REPORTS ANNOTATED

responsibility of the Land Authority "(1) To initiate and prosecute

priority "to the actual occupants personally cultivating the land

10 Sec. 74, R.A. 3844.

VOL. 33, MAY 29, 1970 117

11 L-26255, June 30, 969; 28 SCRA 660,

118 SUPREME COURT REPORTS ANNOTATED

7. Even from the landowner's practical and equitable viewpoint, the

the agricultural lessee and further encourages agricultural lessees to

13 Art. 18, Civil Code.

VOL. 33, MAY 29, 1970 119

16 Respondents-vendees, the spouses Saturnino Hidalgo and Bernardina Marquez;

120 SUPREME COURT REPORTS ANNOTATED

VOL. 33, MAY 29, 1970 121

lots," is P1,500.00, was traversed by respondents in their answer, 20

"Ang halagang P4,000.00 ay hindi kaulat sa tunay na halagan ng mga lupa

122 SUPREME COURT REPORTS ANNOTATED

manded to the agrarian court solely for the purpose of determining

Concepcion, CJ., Reyes, J.B.L., Dizon, Makalintal, Zaldivar,

Decision reversed, petitions granted.

© Copyright 2017 Central Book Supply, Inc. All rights reserved.

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