G.R. No. L-16347; February 27, 1963
JOSE B. YUSAY, petitioner, vs. JUANITO TUGBA, ABRAHAM RUBI and HON. PASTOR P. REYES, as Associate Judge presiding the Eighth Regional District of the Court of Agrarian Relations of Bacolod City, respondents.

FACTS

In March 1958, tenants Juanito Tugba and Abraham Rubi filed separate petitions in the Court of Agrarian Relations against their landholder, Jose B. Yusay. They sought reliquidation of their palay harvests for the agricultural years 1952-53 to 1956-57, alleging they did not receive their full shares. In his answers, Yusay raised the affirmative defense of prescription. The cases were jointly heard, and the court rendered a decision on October 24, 1959, finding Yusay had “short-shared” the tenants by 10% and ordering him to pay the corresponding amounts. The decision did not address the prescription issue.
Yusay filed a motion for reconsideration, specifically calling the court’s attention to his defense of prescription. The court denied the motion, ruling that prescription did not apply because the right to demand a written accounting was distinct from an action for reliquidation. Yusay then elevated the case to the Supreme Court via certiorari, presenting as the sole issue whether the tenants’ cause of action had prescribed.

ISSUE

Whether an action for reliquidation of harvests under the Agricultural Tenancy Act is governed by the same prescriptive period as an action to demand a written accounting, thereby barring the claims for the earlier agricultural years.

RULING

The Supreme Court affirmed the decision of the Court of Agrarian Relations, holding that the action for reliquidation had not prescribed. The Court clarified the legal distinction between an “accounting” and a “reliquidation.” An accounting, under Section 17 of Republic Act No. 1199 (the Agricultural Tenancy Act), is a statement by the landholder detailing contributions, expenses, harvests, and the sharing system. The law provides a three-year prescriptive period from the date of threshing to compel such an accounting. In contrast, a reliquidation is the judicial determination of the correct shares each party is entitled to, based either on an existing accounting or on facts established in court.
The Court, citing its precedent in Benzon v. Ocampo, ruled that the three-year prescriptive period in Section 17 applies solely to actions to demand a written accounting. The Agricultural Tenancy Act is silent on the prescriptive period for an action for reliquidation. Consequently, in the absence of a specific statutory provision, the general rules on prescription in the Civil Code apply. Since there was no written contract between the parties, Article 1145(1) of the new Civil Code governs, which sets a six-year prescriptive period for oral contracts and quasi-contracts. The tenants filed their petitions in 1958, which was within six years from the harvests in question (1952-53 to 1956-57). Therefore, their action was timely. Costs were imposed on the petitioner.