G.R. No. 167891 January 15, 2010
SPOUSES JESUS FAJARDO and EMER FAJARDO, Petitioners, vs. ANITA R. FLORES, assisted by her husband, BIENVENIDO FLORES, Respondent.

FACTS

Leopoldo delos Reyes owned a 25,513-square meter agricultural land (Lot No. 2351). In 1963, he allowed petitioner Jesus Fajardo to cultivate it, initially sharing net harvests equally and later converting the relationship to a leasehold tenancy in 1975. Fajardo was also allowed to erect a house on the stony part of the land. Upon Leopoldo’s death in 1988, his daughter and sole heir, respondent Anita Flores, inherited the property. On June 28, 1991, and July 10, 1991, the parties executed two agreements (“KASUNDUAN”) wherein they agreed to deduct 10,923 sq m from Lot No. 2351 and allot it to petitioner. A conflict arose regarding the interpretation of these agreements, specifically whether the stony portion where Fajardo’s house stood was included. This conflict was referred to the DAR Provincial Office, which advised the parties to bring the matter to the DARAB. Nevertheless, on December 22, 2000, respondent filed a complaint for ejectment against petitioners before the MTC, seeking to recover the stony portion, alleging petitioners’ possession was by mere tolerance. The MTC ruled in favor of respondent, ordering petitioners to vacate, demolish their house, pay compensation, and pay attorney’s fees. The RTC initially affirmed the MTC but, upon reconsideration, reversed itself and dismissed the case for lack of jurisdiction, finding it to be an agrarian dispute. The CA reinstated the MTC decision, ruling the stony portion was residential and the agrarian relationship had been severed by the partition agreements.

ISSUE

Whether the Municipal Trial Court (MTC) or the Department of Agrarian Reform Adjudication Board (DARAB) has jurisdiction over the case.

RULING

The Supreme Court ruled that the DARAB has jurisdiction. The controversy involves an agrarian dispute. The petitioners, as agricultural lessees, have a right to a home lot under Section 24 of R.A. No. 3844 (Agricultural Land Reform Code). The core issue of who has a better right of possession cannot be resolved without interpreting the partition agreements to determine if the stony home lot was allotted to petitioners, making the case incapable of pecuniary estimation and beyond MTC competence. The dispute relates to tenurial arrangements over agricultural land and involves an incident (the home lot) arising from the landlord-tenant relationship. The fact that the dispute over the interpretation of the agreements was previously referred to the DAR, which then referred it to the DARAB, reinforces the application of the doctrine of primary jurisdiction. The contention that the agreements terminated the tenancy relationship is untenable, as an agrarian dispute persists when the controversy involves an incident arising from that former relationship. Therefore, the CA Decision was REVERSED and SET ASIDE, and the RTC Order dismissing the case for lack of jurisdiction was REINSTATED.