Definition and nature of agricultural tenancy

Agricultural tenancy is defined as "the physical possession by a person of land devoted to

agriculture, belonging to or legally possessed by another for the purpose of production
through the labor of the former and of the members of his immediate farm household in
consideration of which the former agrees to share the harvest with the latter or to pay a price
certain or ascertainable, whether in produce or in money, or both." (RA 1199 [1954], sec. 3)
In Gelos vs. CA, 208 SCRA 608 (1992), the Supreme Court held that agricultural tenancy is
not a purely factual relationship. The written agreement of the parties is far more important
as long it is complied with and not contrary to law.

Classes of agricultural tenancy

Agricultural tenancy is classified into share tenancy and leasehold tenancy (M. A.
GERMAN, SHARE AND LEASEHOLD TENANCY, 13 [1995]).
Share tenancy 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 aid of labor available from
members of his immediate farm household, and the produce thereof to be divided between
the landholder and the tenant." (Rep. Act No. 3844 [1963]. Sec. 166 [25]).
With the passage of RA 3844, share tenancy has been declared to be contrary to public
policy and abolished (Rep. Act No. 3844[1963], sec. 4) except in the case of fishponds,
saltbeds, and lands principally planted to citrus, coconuts, cacao, coffee, durian and other
similar permanent trees at the time of the approval of said Act (Rep. Act No. 3844 [1963], sec.
35). When RA 6389 (1971) was enacted, agricultural share tenancy has been automatically
converted to leasehold but the exemptions remained. It was only under RA 6657 when the
exemptions were expressly repealed.
Leasehold tenancy exists when a person who, either personally or with the aid of labor
available from members of his immediate farm household undertakes to cultivate a piece of
agricultural land susceptible of cultivation by a single person together with members of his
immediate farm household, belonging to or legally possessed by, another in consideration of
a fixed amount in money or in produce or in both (Rep. Act No. 1199 [1954], sec. 4).
Under RA 6657, the only agricultural tenancy relation that is recognized is leasehold
tenancy. Said law expressly repealed Sec. 35 of RA 3844, making all tenanted agricultural
lands throughout the country subject to leasehold.
Leasehold tenancy may be established by operation of law, that is, through the abolition of
share tenancy under Sec. 4 of RA 3844; through the exercise by the tenant of his right to elect
leasehold; or by agreement of the parties either orally or in writing, expressly or impliedly,
which was the condition before 1972 (M.A. German,supra, at 27).
Leasehold relation is instituted in retained areas with tenant(s) under RA 6657 or PD
27 who opts to choose to remain therein instead of becoming a beneficiary in the same or
another agricultural land with similar or comparable features. The tenant must exercise his
option within one (1) year from the time the landowner manifests his choice of the area for
retention (Rep. Act No. 6657[1988], sec. 6). Leasehold relation also exists in all tenanted
agricultural lands that are not yet covered under CARP (DAR Adm. O. No. 5 [1993]).
 The institution of leasehold in these areas ensure the protection and improvement of the
tenurial and economic status of tenant-tillers therein. (Rep. Act No. 6657 [1988], sec. 6).
Leasehold tenancy distinguished from civil law lease
In Gabriel vs. Pangilinan, 58 SCRA 590 (1974), the Supreme Court distinguished leasehold
tenancy from civil law lease.
There are important differences between a leasehold tenancy and a civil law lease. The
subject matter of leasehold tenancy is limited to agricultural land; that of civil law lease may
be either rural or urban property. As to attention and cultivation, the law requires the
leasehold tenant to personally attend to, and cultivate the agricultural land, whereas the civil
law lessee need not personally cultivate or work the thing leased. As to purpose, the
landholding in leasehold tenancy is devoted to agriculture, whereas in civil law lease, the
purpose may be for any other lawful pursuits. As to the law that governs, the civil law lease is
governed by the Civil Code, whereas leasehold tenancy is governed by special laws (at 596).
Elements of Agricultural Tenancy
The following are the essential requisites for the existence of a tenancy relation:
a) The parties are the landholder and the tenant;
b) The subject is agricultural land;
c) There is consent by the landholder for the tenant to work on the land, given either
orally or in writing, expressly or impliedly;
d) The purpose is agricultural production;
e) There is personal cultivation or with the help of the immediate farm household; and
f) There is compensation in terms of payment of a fixed amount in money and/or
produce. (Carag vs. CA, 151 SCRA 44 [1987]; Gabriel vs. Pangilinan, 58 SCRA 590
[1974]; Oarde vs. CA, 280 SCRA 235 [1997]; Qua vs. CA, 198 SCRA 236 [1991])
The Supreme Court emphasized in numerous cases that "(a)ll these requisites must concur
in order to create a tenancy relationship between the parties. The absence of one does not
make an occupant of a parcel of land, or a cultivator thereof, or a planter thereon, a de
jure tenant. This is so because unless a person has established his status as a de jure tenant,
he is not entitled to security of tenure nor is he covered by the Land Reform Program of the
Government under existing tenancy laws." (Caballes v. DAR, 168 SCRA 254 [1988])
In the case of Teodoro vs. Macaraeg, 27 SCRA 7 (1969), the Court found all the elements of an
agricultural leasehold relation contained in the contract of lease executed by the parties.