G.R. No. L-36626 April 15, 1988
ANDRES DE LA MERCED, LAND AUTHORITY, and LAND BANK, plaintiffs-appellants, vs. TEODORO DE GUZMAN, defendant-appellee.

FACTS

Plaintiff-appellant Andres de la Merced was the agricultural lessee of a three-hectare riceland in Bulacan owned by defendant-appellee Teodoro de Guzman. On June 22, 1970, the landowner offered in writing to sell the land to De la Merced, giving him ninety (90) days to exercise his right of pre-emption under Section 11 of Republic Act No. 3844 (Agricultural Land Reform Code). De la Merced received the notice on July 3, 1970, and expressed his intent to buy, seeking assistance from the Land Authority and the Land Bank. A conference was held but the parties failed to agree on a price. Within the 90-day period, on September 17, 1970, De la Merced, joined by the Land Authority and Land Bank as co-plaintiffs, filed a complaint for pre-emption in the Court of Agrarian Relations.
The landowner filed a motion to dismiss, which the trial court granted on March 31, 1971. The court ruled the complaint failed to state a cause of action because it did not allege that De la Merced had tendered or consigned the reasonable purchase price in court within the statutory 90-day period. The plaintiffs’ motions for reconsideration were denied, prompting an appeal. The Court of Appeals referred the case to the Supreme Court as it involved purely legal questions.

ISSUE

Whether the Court of Agrarian Relations correctly dismissed the complaint for failure to state a cause of action due to the plaintiff-lessee’s failure to allege a tender or consignation of the purchase price within the 90-day period for exercising the right of pre-emption.

RULING

Yes, the dismissal was correct. The Supreme Court affirmed the trial court’s order. The legal logic is anchored on the mandatory and jurisdictional nature of the requirements under Section 11 of R.A. No. 3844 . The right of pre-emption is not exercised by mere intent or by the filing of a judicial action alone. The law explicitly requires the exercise of this right “within 90 days from notice in writing.” The Court, citing precedent, held that this exercise is contingent upon the actual tender of payment or consignation of the reasonable price within this period.
The complaint was fatally defective because it merely alleged the Land Authority and Land Bank’s willingness to assist financially, but it did not allege the essential fact that the purchase price was tendered or deposited within the 90 days. The filing of the complaint itself does not interrupt this period. The purpose of the tender requirement is to avoid unnecessary litigation by giving the landowner a concrete offer to accept. The law makes no exception for government financial institutions like the Land Bank; the 90-day period applies equally to all. Since the complaint omitted this crucial allegation, it failed to state a cause of action, warranting its dismissal.