G.R. No. 206788 . February 14, 2018
CHAILESE DEVELOPMENT COMPANY, INC., REPRESENTED BY MA. TERESA M. CHUNG, PETITIONER, V. MONICO DIZON, ET AL., RESPONDENTS.

FACTS

Petitioner Chailese Development Company, Inc., a registered owner of parcels of land in Floridablanca, Pampanga, filed a complaint for recovery of possession and damages against numerous respondents before the Regional Trial Court (RTC). Petitioner alleged that respondents were illegally occupying its properties, preventing their development for commercial and light industrial uses, a conversion previously authorized by the Department of Agrarian Reform (DAR). Respondents, in their answer, claimed the RTC lacked jurisdiction, asserting they were agricultural tenants of the land prior to its transfer to petitioner. They argued the conversion was a “bogus” petition to avoid land distribution under agrarian reform, making the case an agrarian dispute under DAR’s primary jurisdiction.
The RTC initially dismissed the complaint for lack of jurisdiction, finding the possession issue intertwined with unresolved DAR matters on conversion and disturbance compensation. After procedural motions, the RTC reinstated the case and proceeded with trial. Following the effectivity of Republic Act No. 9700 , which strengthened the Comprehensive Agrarian Reform Program (CARP) and added Section 50-A mandating automatic referral of agrarian disputes to the DAR, respondents moved for referral. The RTC denied the motion, noting it had assumed jurisdiction before the law’s effectivity and that referral would cause delay. The Court of Appeals reversed the RTC, ordering the case referred to the DAR, prompting petitioner’s appeal to the Supreme Court.

ISSUE

Whether the Court of Appeals erred in ordering the referral of the case to the DAR under Section 50-A of R.A. No. 9700 .

RULING

Yes, the Court of Appeals erred. The Supreme Court reversed the CA’s decision and reinstated the complaint before the RTC. The Court held that for Section 50-A of R.A. No. 9700 to apply, thereby mandating referral to the DAR, the controversy must constitute an “agrarian dispute” as legally defined. An agrarian dispute requires, among other elements, a tenurial arrangement between the parties or their predecessors-in-interest, involving rights and obligations over agricultural lands. The Court emphasized that mere allegations of tenancy are insufficient; there must be substantial evidence to support a prima facie case of such a relationship.
In this case, respondents’ answer contained only general and unsubstantiated claims of being tenants of the previous landowner. They failed to elaborate on or provide evidence of the specifics of any tenancy agreement, the identity of the alleged landholder, or the nature of their agricultural work on the property. The absence of any proof of a tenurial link between the respondents and the petitioner or its predecessor-in-interest was fatal to their claim. Consequently, the controversy did not meet the legal definition of an agrarian dispute. Therefore, the RTC correctly retained jurisdiction over the ordinary action for recovery of possession, and the mandatory referral mechanism under R.A. No. 9700 was not triggered. The case was remanded to the RTC for continuation of proceedings.