G.R. No. 190276, April 2, 2014
EUFROCINA NIEVES, as represented by her attorney-in-fact, LAZARO VILLAROSA, JR., Petitioner, vs. ERNESTO DULDULAO and FELIPE PAJARILLO, Respondents.

FACTS

Petitioner Eufrocina Nieves is the owner of a six-hectare agricultural rice land in Nueva Ecija. Respondents Ernesto Duldulao and Felipe Pajarillo are the tenants/cultivators obligated to pay leasehold rentals of 45 cavans of palay each per cropping season (May and December). Petitioner filed a petition for ejectment before the DARAB Provincial Adjudicator (PARAD) in March 2006, alleging respondents failed to pay leasehold rentals since 1985, with accumulated arrearages of 446.5 cavans (Ernesto) and 327 cavans (Felipe). Prior mediation in 2005 led to respondents admitting default and promising to pay. In their answers, Ernesto claimed he merely inherited his father’s arrears but proposed installment payments, while Felipe denied arrears but also proposed installments. Both cited supervening calamities (flashfloods, typhoons) as reasons for non-payment. The PARAD ordered ejectment, finding the tenancy relations severed due to willful non-payment. The DARAB affirmed. The Court of Appeals reversed, finding non-payment was not willful and deliberate, noting respondents failed to pay only a small percentage of total rentals due (Ernesto 6%, Felipe 16.28%), and applying the “substantial compliance” doctrine from De Tanedo v. De La Cruz.

ISSUE

Whether or not the Court of Appeals correctly reversed the DARAB’s ruling ejecting respondents from the landholding.

RULING

No. The Supreme Court granted the petition and reversed the Court of Appeals. The Court held that to eject an agricultural lessee for non-payment of lease rentals under Section 36(6) of Republic Act No. 3844 (Agricultural Land Reform Code), the failure to pay must be willful and deliberate. Respondents’ defense of fortuitous events (calamities) was unsubstantiated by evidence. Their failure to pay, resulting in significant accumulated arrears over many years (from 1985 to 2005), was willful and deliberate. The doctrine of “substantial compliance” from De Tanedo was inapplicable as that case involved a share tenancy under Republic Act No. 1199, not a leasehold tenancy under RA 3844 where the lessee’s obligation to pay a fixed rental is absolute and not subject to proportional reduction based on harvest. The DARAB’s decision ordering respondents’ ejectment for willful non-payment of leasehold rentals was reinstated.