b.
Share Tenancy – under this system of landholding, tillers
AGRARIAN LAW by Barte
INTRODUCTION
A. DEFINITIONS AND TERMS
Reform – presupposes that something is defective, hence, needs
reformation and correction.
Land Reform – denotes a broad concept of conventional and
revolutionary measures intended to correct certain defects in the
relationship between landowner and tiller regarding their rights and
obligations in the cultivation and management of landholding.
Agrarian Reform – refers not only to land reform but also
embraces a full range of measures designed to improve the
relationship between landowner and tiller, employer and employee,
corporate management and stockholders, cooperatives and
members, and other farmers’ organizations including their
economic, social and political relations with the community and the
government.
Comments:
Under the Comprehensive Agrarian Reform Law of 1998 (R.A. No.
6657), Agrarian Reform is defined as the redistribution of lands,
regardless of crops or fruits produced, to farmers and regular
farmworkers who are landless, irrespective of tenurial arrangement.
AGRARIAN STRUCTURE
Refers to that complex set of relationships within the agricultural
sector between tenure structure, production structure and
structure for supporting services.
1. Land Tenure Structure – is a concept that connotes one or
more types of land tenure system regulating the rights to
ownership and control and usages of land and the duties
accompanying such rights.
a. Agricultural Tenancy – refers to the manner of holding
agricultural lands.
work the land as sharecroppers entitled to share in the
produce of the land.
c. Leasehold Tenancy – is a tenurial system which was
instituted by R.A. No. 3844 (Code of Agrarian Reforms)
characterized by lessor and lessee relationship which is
created either by written or oral agreement between the
parties or impliedly by acceptance of benefits by the
landowner, or by an act of cultivation thru the toleration of
the owner.
Comments:
Leasehold relationship abolished the share tenancy system under
the Rice Share Tenancy Act of 1933 as amended, P.D. No. 27 was
issued by then President Ferdinand Marcos which aside from
upholding the leasehold relationship, likewise ordained the
emancipation of tenant-farmers from the bondage of the soil, and
considered them ipso facto owners of the lands they till primarily
devoted to rice and corn.
P.D. No. 27 (Tenants Emancipation Decree) likewise fixed the
retention limit for the landowner an area not exceeding seven (7)
hectares, provided, that such landowner is cultivating or will now
cultivate the land, and furthermore, that he does not own other
agricultural lands of more than seven (7) hectares.
d. Amortizing Owner – a tenant-farmer whose status had
been raised automatically by operation of law from
leasehold tenant to that of amortizing owner, who makes
repayments of the purchase price of the land he tills to the
Land Bank.
e. Full Owner or Owner-Cultivator – is an amortizing owner
(tenant-farmer) who has completed full payment of his
amortization to the Land Bank of the Philippines, and is
therefore entitled to a certificate of title under the Torrens
System.
Comments:
Under R.A. No. 3844, as amended by R.A. No. 6389, there are three
shifts in the conversion of the tenurial status of tenant-farmer to
full owner, namely: share tenant to leaseholder to amortizing
owner, and from amortizing owner to full owner (owner-cultivator).
An amortizing owner by operation of law (P.D. No. 27) is entitled to
an Emancipation Patent which serves as a farmholder’s provisional
title of ownership to the land upon completion of his amortization
repayments to the Land Bank, or to the Landowner in cases of
farmers who have been amortizing their lands with the landowner.
f. Owner-Cultivator – is the term applied to a tenant – farmer
who has attained the status of full owner and qualified
beneficiary under the Agrarian Reform Law of the
Philippines.
2. Production Structure – is a concept that refers to the use of
the land, nature and method of farm operation, and the process of
production.
3. Structure for Supporting Services – is an agrarian reform
measure designed to help the tenant – tiller in the availment of
credit facilities, marketing of his products, supplying of seeds,
insecticides, fertilizers, irrigation, storage, processing and other
technical assistance / services in direct bearing to reforms of tenure
and production structures.
HISTORICAL BACKGROUND
Even before the Spaniard came into these Island, the idea of
private ownership of land was not prevalent. Land was commonly
owned by the community or barangay, cultivated communally or
individually by members of the barangay.
When the Spaniard came in 1521, common ownership of land
slowly took the backseat, and private property became dominant,
paving the way to Encomienda system.
The encomienda was a vehicle used to collect taxes from Filipinos,
who tilled the land and surrendered part of their produce to the
encomendero as tribute in the form of agricultural crops, poultry,
woven mats, etc. Towards the end of the 18 th century, there was a
mad scramble for wealth thru world trade. Thus, encomienda were
replaced by haciendas.
CONSTITUTIONAL MANDATES ON AGRARIAN REFORM
The state shall promote a just and dynamic social order that will
free the people from poverty through policies adequate social
services, promote full employment, a rising standard of living, and
an improve quality of life for all.
The state shall promote a comprehensive rural development and
agrarian reform.
The State shall, by law, undertake an agrarian reform program
founded on the right of the 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. (Art. XIII, Social Justice and Human Rights, Sec. 4).
CONTEMPORANEOUS PRECEPTS AND MEASURES
In order to implement the 1987 Constitution, Congress passed the
Comprehensive Agrarian Reform Law of 1988. (R.A. NO. 6657)
which was signed into law by the President of the Phillippines on
June 10, 1988, and took effect on June 15, 1988. This is the main
law on agrarian reform in the Philippines today. The CARL provides
that all other laws on agrarian reform not contrary or inconsistent
with the provisions of this Act shall have suppletory effect.
LAND REFORM MEASURES RETRACED
Treaty of Paris (1898) – the confiscation of friar lands and
distributed among peasants by the independent government of
Malolos during the Philippine Revolution.
Philippine Bill (1902) – Limited private individual landholdings to
16 hectares, and corporate landholdings to 1,024 hectares.
Land Registrations Act (1902) – Landowners were required to
register their landholdings and acquire Torrens titles to land
properties.
Friar Land Act – Instituted transfer of friar lands to the tenants to
diffuse the peasant unrest.
Rice Share Tenancy Act (Public Act No. 4054) - which
provided for a 50-50 sharing of the crop, an interest rte ceiling of
10 percent per crop year, and safeguards against arbitrary
dismissal of tenants by landlords.

Commonwealth Act.No. 278 of 1938 – to buy farms and large
estates for subletting to bonafide occupants with an option to buy,
thru the National Land Settlement Administration (NLSA).
Sugar Cane Tenancy Contracts Act. (Act. No. 4113) – makes it
a duty of the sugar central to exhibit to the tenant the receipts of
the number of tons milled by the landowner thereat.
Commonwealth Act. No. 103 – created the Court of Industrial
Relations (CIR) which exercised jurisdiction over disputes arising
from relationship between agricultural workers and landowners.
Commonwealth Act. No. 213 – deals with the right to form
legitimate labor organizations and to enter into collective
bargaining agreements between management and labor.
Commonwealth Act No. 178 – which improved the provision of
Act No. 4054 the Rice Share Tenancy Act, giving more teeth and
protection to the rights of tenants of agricultural lands.
Republic Act. No. 34 – amended certain Sections of the Rice
Share Tenancy Act providing for a 70 – 30 crop – sharing method.
Republic Act No. 1160 – established the National Resettlement
and Rehabilitation Administration (NARRA) of landless dissidents
and other landless farmers.
Republic Act No. 1199 (Agricultural Tenancy Act) – infused an
added boost to the tenurial rights of tenant – tiller.
Land Reform Act (R.A. No. 1400, 1955) - guaranteed the
expropriation of all tenanted landed estates. It set a retention limit
of 300 hectares for individually – owned estates, and 600 hectares
for corporate – owned estates.
Republic Act. No. 1267 – An Act Creating the Court of Agrarian
Relations to try and decide all matters arising from the relationship
of persons in the cultivation and use of agricultural lands.
Republic Act. No. 3844 – marked the abolition of share tenancy
and / or the system of share – cropping between landowner and
tenant, and the automatic conversion of share tenants into
leaseholders.
Republic Act No. 6389 (Code of Agrarian Reforms) – an
improvement of R.A. No. 3844, this amendatory Act featured the
creation of the Department of Agrarian Reforms (DAR).
Agrarian Reform Special Fund Act (Rep. Act. No. 6390) –
provided for a special account and financial support for the
Agrarian Reform Program of the government.
Presidential Decree No. 2 – declaring the entire nation as a land
reform area.
Presidential Decree No. 27 – decreeing the emancipation of the
tenants, transferring to them the ownership of the land they till.
Proclamation No. 131 – Instituting a comprehensive agrarian
reform program which covers, all public and private agricultural
lands as provided in the Constitution.
Executive Order No. 228 – Declaring full landownership to
qualified beneficiaries covered by Presidential Decree No. 27.
Executive Order No. 229 – Providing for the mechanisms for the
implementation of the comprehensive agrarian reform program,
creating the Presidential Agrarian Reform Council (PARC).
Executive Order No. 129-A – Modifying Executive Order No. 129,
reorganizing and strengthening the Department of Agrarian Reform.
Republic Act No. 6657 - As primary agrarian land reform
measure in the country today, its operation covers all public and
private agricultural lands, including other lands of the public
domain suitable for agriculture.
CHAPTER I
AGRICULTURAL LEASEHOLD CONCEPT
A. AGRICULTURAL LAND REFORM CODE (Rep. Act. No. 3844)
REPUBLIC ACT No. 3844 August 8, 1963
AN ACT TO ORDAIN THE AGRICULTURAL LAND REFORM CODE
AND TO INSTITUTE LAND REFORMS IN THE PHILIPPINES...
REPUBLIC ACT No. 3844
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
Section 1. Title - This Act shall be known as the Agricultural
Land Reform Code.
1. PREFATORY STATEMENTS
The thrust of this legislation is the drastic abolition of share tenancy
system. It provided for the automatic conversion of the
sharecropper to the status of an agricultural lessee, governed by
the system of agricultural leasehold which is established either:
a. by agreement of the parties, whether oral or written, or
b. by operation of law.
The Agricultural Land Reform Code still finds application to the
following:
a. areas which have not come within the operation and
implementation of P.D. No. 27;
b. agricultural laborers subject to the provisions of the Labor
Code;
c. organization and operation of the Land Bank;
d. provisions on resettlements of farmers;
e. right to pre-emption and redemption, with respect to land-
owner’s retained area, should such landowner decide to sell
his tenanted / leased retained area, the tenant has the
preferential right to purchase and / or redeem the same in
case the land is sold to a third person without the tenant’s
knowledge;
f. right of the tenant / lessee to 75% share from the standing
crops;
Three shifts in the mode of acquisition
a. The automatic conversion of the status of share tenant to
leaseholder characterized by payment of fixed rentals;
b. The second shift which is the conversion of the leaseholder
to amortizing owner, characterized by the Land Bank
purchase of the property with a concomitant obligation
imposed on the tenant-lessee to pay Land Bank on
amortization basis the purchase price of the farmholding;
c. The third shift which converts the status of an amortizaing
owner into full owner or owner-cultivator upon full payment
of the remaining balance of the amortization.
Section 3. Composition of Code -
1. An agricultural leasehold system to replace all existing share
tenancy systems in agriculture;
2. A system of crediting rental as amortization payment on
purchase price;
3. A declaration of rights for agricultural labor;
4. A machinery for the acquisition and equitable distribution of
agricultural land;
5. An institution to finance the acquisition and distribution of
agricultural land;
6. A machinery to extend credit and similar assistance to
agricultural lessees, amortizing owners-cultivators, owners-
cultivator and cooperatives;
7. A machinery to provide marketing, management and other
technical assistance and / or services to agricultural lessees,
amortizing owners-cultivators, owner-cultivator,
cooperatives;
8. A machinery for cooperative development;
9. A department for formulating and implementing projects of
agrarian reform;
10. An expanded program of land
11. A judicial system to decide issues arising under this Code.
12. A machinery to provide legal assistance to agricultural
lessees, amortizing owners-cultivator, and owners-cultivator.
Repayment Scheme and Credit Assistance
Jurisdiction on Agrarian Disputes
All agrarian disputes are now under the cognizance of the
Department of Agrarian Reform thru the Agrarian Reform
Adjudication Board.
The Department of Agrarian Reform Adjudication Board (DARAB) in
turn delegates its functions to the respective Regional and
Provincial Adjudicators of the DAR. Any decision, order, award or
ruling of the DAR on any agrarian dispute, may be brought to the
Court of Appeals on certiorari.
Special Agrarian Courts
Under the present law (R.A. No. 6657) all controversies involving
the determination of just compensation and prosecution of all
criminal offenses arising from violations of the provisions of this
Act, fall under the original and exclusive jurisdiction of Special
Agrarian Courts.
Bureau of Agrarian Legal Assistance
They shall be responsible for the development of plans and
programs for the extension of legal information to farmers;
extension of legal services to them.
DEFINITION OF TERMS
Agricultural land – means land devoted to any growth, including
but not limited to crop lands, saltbeds, fishponds, idle land and
abandoned land.
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.
Agricultural lessor – means a person, lets or grants to another
the cultivation and use of his land for a price certain.
Agricultural year – means the period of time required for raising a
particular agricultural product.
Farm implements – means hand tools or machineries in a farm
enterprise.
Immediate farm household - means the members of the family
of the lessee or lessor and other persons who are dependent upon
him for support.
Proven farm practices – means sound farming practices.
Personal cultivation – means cultivation by the lessee or lessor in
person.
Work animals – means animals ordinarily employed in a farm
enterprise.
Agrarian dispute – means any controversy relating to terms,
tenure or condition of employment, or concerning an association or
representation of persons in negotiating, maintaining, changing or
seeking to arrange terms on conditions of employment.
Agricultural owner-cultivator – means any person who,
personally cultivates his own land.
Fair rental value – means the value not in excess of allowable
depreciation plus 6% interest per annum.
Incapacity – means any cause or circumstance which prevents the
lessee from fulfilling his contractual and other obligations under the
Code.
Modes of Land Tenure Allowed under R.A. No. 3844
1. Leasehold system – characterized by a tenant – farmer
personally and actually cultivating the farmholding under a
leasehold relationship whereby the lessee pays a fixed
amount of rental whether in cash or in kind to the lessor.
2. Share tenancy
3. Owner-cultivatorship
4. Cooperative-cultivatorship – which is a form of agrarian
relationship among members of a cooperative who work and
live on the land as tillers in common.
5. Labor administration – which employs laborers and
workers on a daily wage basis, and engaged in a large scale
plantation farming of permanent crops by their respective
managers.
How Leasehold Relation is Established
1. by agreement of the parties
2. by operation of law – implementation of R.A. No. 3844 providing
for the abolition of share tenancy.
Parties to Leasehold Relation
1. the landholder
2. the person who personally cultivates the land.
ESSENCE OF LEASEHOLD RELATION
1. It is essentially personal, in the sense that it cannot be
exercised by third persons other than the lessor himself, and
the lessee who personally cultivates the land;
2. It has the nature of an in rem or real relationship, because it
imposes a burden upon the land subject of the landholding
and continues to exist even by the death or incapacity of
either party, or the expiration of the agreement.
Tenurial Arrangement of Leasehold
It makes it a penal offense to eject a tenant illegally from his
holding except upon approval of the court.
Doctrine on security of land tenure
Security of land tenure “the agricultural leasehold relation under
this Code, shall not be extinguished by mere expiration of the term
or period in the leasehold contract, in case the agricultural lessor
sells, alienates of transfers the legal possession of the landholding,
the purchaser or transferee thereof shall be subrogated to the
rights and substituted to the obligations of the agricultural lessor.”
In order to possess the status of a de jure tenant, the following
essential requisites must concur, to wit:
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;
6. there is sharing of harvests.
The absence of one does not make an occupant of a parcel of land
or a cultivator thereof, a de jure tenant, hence cannot invoke the
defense of security of tenure.
What then constitutes as family-size farm so as to give rise
to tenancy relationship?
Family-size farm – an area of farmland that permits efficient use
of labor and capital resources of the farm family and will produce
an income sufficient to provide a modest standard of living to meet
a farm family’s needs for food, clothing, shelter, and education with
possible allowance for payment of yearly installments on the land,
and reasonable reserves to absorb yearly fluctuations in income.
What now is the effect of the law to cultivator-tiller of a less
than family-size farms?
Such landholder-tiller or tiller-sharer, is at most considered as a
mere caretaker before the eyes of the law who is not entitled to the
security of tenure.
Should the landholding be sold or alienated to a new owner,
what happens to the rights and obligations of the
transferee and his heirs?
The transferee and his heirs are subrogated to the rights and
obligations of the former landowner. However, the change of
landowner cannot be allowed to raise the status of a mere
caretaker or tiller – sharer to that of an agricultural tenant and
leaseholder.
Causes for Extinguishment of Leasehold Relation
1. Abandonment of the landholding;
2. Voluntary surrender of the landholding;
3. Absence of successor or qualified heir, in case of death or
permanent incapacity of the lessee;
4. Judicial ejectment of the lessee;
5. Acquisition by the lessee of the landholding;
6. Termination of the leasehold under Sec. 28;
7. Mutual consent of the parties;
8. Conversion of the landholding for non-agricultural purposes.
Obligations of the Lessees
1. To cultivate and take care of the farm as a good father of a
family
2. To inform the agricultural lessor any trespass committed by
third persons upon the farm;
 3. To take reasonable care of the work animals and farm
implements delivered to him by the agricultural lessor, he
shall be held responsible and made answerable therefore to
the extent of the value of the work animals and / or farm
implements at the time of the loss, death or destruction;
4. To keep his farm and growing crops attended to during the
work season. In case of unjustified abandonment all of the
expected produce, any upon order of the court be forfeited
in favor of the agricultural lessor.
5. To notify the agricultural lessor at least three (3) days before
the date of harvesting;
6. To pay the lease rental to the agricultural lessor when it falls
due.
Section 26, R.A. No. 3844, empowers the lessee to take direct
action against any trespasser to the landholding without waiting for
the response from the lessor.
Prohibitions to Agricultural Lessee
a. To contract to work additional lanholdings belonging to a
different agricultural lessor;
b. To acquire and personally cultivate a family-size farm
without knowledge and consent of the agricultural lesor;
c. To employ a sub-lessee.
Termination of Leasehold by the Lessee
1. Cruel, inhuman or offensive treatment of the agricultural
lessee by the agricultural lessor;
2. Non-compliance on the part of the agricultural lessor with
any of the obligations imposed;
3. Compulsion of the agricultural lessee by the agricultural
lessor to do any work not in any way connected with farm
work;
4. Commission of a crime by the agricultural lessor against
the agricultural lessee
5. Voluntary surrender due to circumstances more
advantageous to him and his family.
Rights of the Agricultural Lessor
1. To inspect and observe the extent of compliance of their
contract and the provision of this Chapter;
2. To propose a change in the use of the landholding to other
agricultural purposes. In case of disagreement, the same
shall be settled by the Court (Now Adjudication Board);
3. To acquire the agricultural lessee, to adopt in his proven
farm practices necessary to the conservation of the land,
improvement of its fertility and increase its productivity:
That in case of disagreement as to what proven farm
practice the lessee shall adopt, the same shall be settled by
the court (now the DARAB);
4. To mortgage expected rentals.
Obligations of the Lessor
1. To keep the lessee in peaceful possession and cultivation of
his landholding;
2. To keep intact the permanent useful improvements existing
on the landholding.
The lessee may seek relief from the nearest Regional Agrarian
Reform Adjudicators (RARAD) or the Provincial Agrarian Reform
Adjudicators (PARAD) to compel the agricultural lessor to comply
with this obligation in case of refusal, neglect or resistance on the
part of the lessor.
Prohibition to the Agricultural Lessor
1. To dispossess the agricultural lessee of his landholding
except upon authorization by the court under Section 36.
2. To require the agricultural lessee to assume, the payment
of the taxes on the landholding;
3. To require the agricultural lessee to assume, any part of
the rent, to pay to third persons for the use of the land;
4. To deal with millers or processors without written
authorization of the lessee;
5. To discourage, the formation, maintenance or growth of
unions or organizations of agricultural lessees in his
landholding.
Ground for Disposition of Agricultural Lessee
1. When the landholding is declared by the Department Head
to be suited for residential, commercial, industrial or some
other urban purposes;
2. Failure to comply with any of the of the terms and conditions
of the contract of lease;
 3. Planting of crops or used the landholding for a purpose
other than what had been previously agreed upon;
4. Failure to adopt proven farm practices as determined under
paragraph 3 of Section twenty-nine;
5. When through fault or negligence of the lessee, the land or
other substantial permanent improvement thereon is
substantially damaged or destroyed or has reasonably
deteriorated;
6. Failure to pay the lease rental when it falls due;
7. Employment of a sub-lessee.
The above causes are grounds for ejectment of an agricultural
lessee only after observance of due process.
Lessee’s Right of Pre-emption and Redemption
In case the agricultural lessor decide to sell the landholding, the
agricultural lessee shall have the preferential right to buy the same
under reasonable terms and conditions: each shall be entitled to
said preferential right only to the extent of the area actually
cultivated by him. The right of pre-emption may be exercised
within one hundred eighty (180) days from notice in writing, which
shall be served by the owner on all lessees affected and the
Department of Agrarian Reform.
He must either tender payment of, or present a certificate from the
Land Bank that it shall make payment pursuant to Sec. 80 of this
Code. If the latter refuses to accept such tender or presentment,
he may consign it with the Court.
Any dispute as to reasonableness of the terms and conditions, may
be brought by the lessee or by the Department of Agrarian Reform
to the proper Court of Agrarian Relations.
Comments:
The right of pre-emption as distinguished from redemption, is the
right to purchase the property from the agricultural lessor by the
lessees which is exercised before it is sold to a third person other
than the lessee.
The lessee may consign the purchase money with the Department
of Agrarian Reform.
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:
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 one hundred and eighty days from
notice in writing.
Upon the filing of the petition, the said period o one hundred and
eighty days shall cease to run.
Any petition shall be resolved within sixty days.
The Department of Agrarian Reform shall initiate, while the Land
Bank shall finance, said redemption as in the case of pre-emption.
Right to Self-organization
The farmworkers shall have the right to self-organization and form,
join or assist farmworkers’ organizations of their own choosing for
the purpose of collective bargaining through representatives of
their own choosing.
Bill of Rights for Agricultural Labor:
1. Right to self – organization;
2. Right to engage in concerted activities.
3. Right to minimum wage;
4. Right to work for not more than eight hours;
5. Right to claim for damages for death or injuries sustained
while at work;
6. Right to compensation for personal injuries; death or illness;
7. Right against suspension or lay-off.
Comments:
The right to self – organization includes the right to strike and hold
picket in order to compel the management in the case of large
scale plantations and multinational corporations to meet the
demands of the farm workers for wage increase and better working
conditions.
Irrigation Facilities

Permanent irrigation system may be constructed at the expense of
the lessor:
1. Should the lessor refuse to bear the expenses, he should not
be entitled to the increase in rental and shall upon the
termination of the leasehold relationship pay the lessee or
his their the reasonable value of the improvements at the
time of the termination;
2. Should the lessor bear expenses he shall be entitled to an
increase in the rental proportionate to the resultant increase
in production.
Management of Irrigation System
Whatever balance remaining after crediting as amortization the
rental paid, the same may be finances by the Land Bank in the
same ratio and mode of payment provided under Section 80 of the
Code.
Default on the Part of the Lessee: Should the lessee incur default
in the payment of at least three (3) installments on the loan, the
lender shall immediately notify the Land Bank and the DAR so that
appropriate steps shall be taken by these agencies:
a) to answer for the default in case the failure is due to
fortuitous event
b) to take over the ownership and administration of the
landholding.

1. When constructed and operated by the government.
Lessees either as individuals or groups shall allocate not
more than 25% of their rental collection to the government.
2. Irrigation systems installed and / or constructed at expense
of landowner or agricultural lessor – acquisition of these
irrigation system shall be initiated by the DAR to be
financed by the Land Bank.
Where the case of the default is attributable to the lessee, the DAR
shall endeavor to substitute the defaulting amortization owner. In
case the default is due to fortuitous event, the Land Bank shall
assume the payment of the balance and the farmer shall be
released from his obligation.
Period of Prescription

Lease of Ricelands and Lands Devoted to Other Crops An action to enforce any cause of action accruing under this Code
(R.A. No. 3844) shall be brought within the period of three (3)
1. 25% of the average normal harvest – shall be the amount years.
of rental for ricelands or estimated normal harvest during
the three (3) agricultural years immediately preceding the
establishment of the leasehold after deducting the
expenses for seeds, cost of harvesting, threshing, loading,
hauling and processing;
2. Average normal harvest for three (3) preceding years.
3. No agreement as to rental – the court (now DAR) shall fix a
provisional rental until fixed rental is determined within
(30) days from submission of the case for decision.

Amortization Payment for Land under Leasehold:

The rentals paid by the lessee to the lessor at the place agreed
upon by the parties shall be credited as amortization payments for
the purchase price of the landholding titled by the leasee:

a) When the landholding is expropriated by the government;

b) When it is redeemed.