G.R. No. 135999 April 19, 2002
MILESTONE REALTY AND CO., INC. and WILLIAM L. PEREZ, petitioners, vs. HON. COURT OF APPEALS, DELIA RAZON PEÑA and RAYMUNDO EUGENIO, respondents.

FACTS

The case involves an agricultural land in Valenzuela, Bulacan, originally owned by Carolina Zacarias. The deceased tenant, Anacleto Peña, was survived by his second wife, respondent Delia Razon Peña, and children from his first marriage, including Emilio Peña. Upon Anacleto’s death, the agricultural leasehold relation was to continue with a successor chosen by the landowner, Carolina Zacarias, within one month as mandated by Section 9 of Republic Act No. 3844 . Carolina later claimed she chose Emilio as the successor tenant. Subsequently, Emilio executed documents surrendering the landholding in exchange for a substantial disturbance compensation. Carolina then sold the property to petitioner Milestone Realty & Co., Inc.
Respondent Delia Peña, assisted by her son-in-law Raymundo Eugenio, filed a complaint before the Provincial Agrarian Reform Adjudicator (PARAD) seeking to nullify the sale and to be declared the bona fide tenant. The PARAD dismissed the complaint, upholding Emilio’s surrender and the subsequent sale. On appeal, the Department of Agrarian Reform Adjudication Board (DARAB) reversed the PARAD, declaring Delia as the legitimate tenant and nullifying the sale. The Court of Appeals affirmed the DARAB decision.

ISSUE

The core issue is whether respondent Delia Razon Peña is the legitimate successor to the agricultural leasehold rights over the subject land upon the death of her husband, tenant Anacleto Peña.

RULING

The Supreme Court DENIED the petition and AFFIRMED the Court of Appeals’ decision, upholding Delia Peña as the bona fide tenant. The legal logic rests on the mandatory and preferential order of succession under Section 9 of R.A. 3844. The law explicitly provides that in case of the tenant’s death, the leasehold continues with a person chosen by the landowner within one month from among: (1) the surviving spouse; (2) the eldest direct descendant; or (3) the next eldest descendant. Crucially, if the landowner fails to make a choice within this one-month period, the priority automatically follows the statutory order.
The Court found that landowner Carolina Zacarias failed to exercise her right of choice within the one-month period from Anacleto’s death. Her subsequent claim of having chosen Emilio was unsupported by conclusive evidence showing a timely and valid selection. Consequently, the order of preference became operative by operation of law. As the surviving spouse, Delia Razon Peña held the first priority and thus rightfully succeeded to the tenancy rights. Therefore, Emilio had no valid tenancy rights to surrender, and the sale of the land by Carolina to Milestone, conducted without recognizing Delia’s superior rights as tenant, was correctly declared void. The tenancy rights, being a personal and protected interest, were not extinguished by the invalid sale.