G.R. No. L-16963. April 26, 1961. ROXAS Y CIA, petitioner, vs. HON. JOSE R. CABATUANDO, ET AL., respondents.
FACTS

Petitioner Roxas Y Cia, owner of Hacienda Caylaway, entered into a 1953 contract with its tenant-respondents. The contract stipulated that the tenants would receive all produce from auxiliary crops (e.g., palay) planted between coconut trees, but must deliver one-sixth of that harvest to the landowner. Crucially, the tenants were explicitly excluded from sharing in the coconut produce, as their obligation was limited to protecting the existing coconut trees, not cultivating them. The tenants later filed a petition with the agrarian court, seeking to nullify this contract under Section 11 of Republic Act No. 1199 , arguing it was contrary to morals and public policy for depriving them of a share in the coconut harvest. In its answer, petitioner asserted the contract’s validity and, by way of counterclaim, sought to eject the tenants for their admitted failure to deliver the landowner’s one-sixth share of the auxiliary crops for the agricultural years 1955-1957.

ISSUE

Did the agrarian court err in dismissing the petitioner’s counterclaim for ejectment based on the tenants’ failure to deliver the landowner’s share of the harvest for three consecutive years?

RULING

No, the agrarian court did not err. The Supreme Court affirmed the dismissal of the ejectment counterclaim. The legal logic is anchored on the interpretation of Section 50(c) of Republic Act No. 1199 (the Agricultural Tenancy Act), which provides that mere failure to pay the landholder’s share does not automatically justify ejectment if there is a lack of deliberate intent to pay or a failure of crops due to a fortuitous event. The Court found the tenants’ failure to deliver was in good faith, not deliberate. They withheld payment due to a bona fide doubt regarding the legality of the contract concerning coconut shares, intending to have the courts resolve the dispute. This good faith was demonstrated when the tenants themselves initiated the court action to settle the controversy after the landowner took no steps for three years, and when they promptly complied with the court’s order for an accounting and assured payment if the landowner prevailed. Furthermore, evidence showed harvests were meager during the period, the landowner had previously waived shares during poor harvests, and its inaction for three years undermined its claim of a sincere desire to eject. Thus, the legal requisites for ejectment under the tenancy law were not met.