G.R. No. L-14737; September 30, 1960
LEONCIA VELASCO, petitioner, vs. THE COURT OF AGRARIAN RELATIONS and VALENTIN DOMINGO and MANUEL DOMINGO, respondents.

FACTS

On May 23, 1952, petitioner Leoncia Velasco leased a parcel of land to respondents Valentin and Manuel Domingo for three agricultural years. On April 28, 1955, Velasco sold the land to Marcelino Maclang. On May 3, 1955, Maclang filed an ejectment action against the Domingos. Velasco intervened in this case. The ejectment suit was decided in favor of Maclang. A separate trial was held on Velasco’s claim against the Domingos for unpaid rentals under their lease contract, which fixed the rental at 90 cavans of palay. The Court of Agrarian Relations rendered a supplemental decision ordering Velasco to deliver to the Domingos 179.25 cavans of palay or its monetary value, with interest. The court applied Section 7 of Act 4054, which limits agricultural rental to not more than 25% of the estimated normal harvest for the last three years. It found the agreed rental of 90 cavans excessive based on its assessment of the evidence regarding the land’s average yield. Velasco appealed this decision.

ISSUE

Whether the Court of Agrarian Relations erred in declaring the rental of 90 cavans agreed upon in the lease contract as excessive and in placing the burden of proving the legality of the rental on the lessor (Velasco) instead of the lessees (Domingos) who claimed it was excessive.

RULING

The Supreme Court reversed the decision of the Court of Agrian Relations. It held that the trial court erred in placing the burden of proof on the lessor to show the legality of the rental. The lease contract was a product of voluntary agreement. Under the Rules of Court, a person is presumed to take ordinary care of his concerns, and private transactions are presumed fair and regular. The party alleging that the agreed rental is excessive and violates the legal limit (the Domingos) holds the affirmative of that issue and therefore bears the burden of proving it. The Court found the evidence on the land’s harvests conflicting: Velasco presented positive testimony from a former tenant on specific harvests for the years preceding the lease, while the Domingos presented circumstantial evidence about salty water affecting the land and harvests during the lease term. The Supreme Court concluded that the Domingos failed to overcome the presumptions of regularity and legality of the contract and to satisfactorily prove that the rental was excessive. Consequently, the Court reversed the appealed judgment. However, as the record did not disclose what portion of the rentals remained unpaid, and considering Velasco’s own statement that the respondents were at most entitled to a dismissal of her claim, the Supreme Court dismissed both Velasco’s claim and the Domingos’ counterclaim.