September 24, 1999

DAR OPINION NO. 48-99

MR. BARTOLOME GATONGAY

Pagsanhan, San Francisco

Quezon

Dear Mr. Gatongay:

This pertains to your oral query on the propriety of delivering rentals to the owner of the land based on the Provisional Lease Rental (PLR) fixed in accordance with Administrative Order No. 5, Series of 1993, which is still pending with the PARAD/RARAD for approval.

We understand that the MARO of San Francisco, Quezon, provisionally fixed the lease rental for the property owned by Superior Agro-Industrial Incorporated (SAII) and submitted the same to the PARAD of Quezon for approval. Subject PLR involves ten (10) agricultural tenants who were SAII's share tenants before the PLR was fixed. They are:

1.         Felicisimo Masucol

2.         Artemio Amaro

3.         Pedro Mahinay

4.         Diosdado Barco

5.         Prospero Rosita

6.         Gloria Gallo

7.         Timotea Suarez

8.         Cesar Abetria

9.         Rolando Armohila and

10.       Alfredo Rosita, Jr.

At the outset, we wish to state that pursuant to Republic Act No. 3844 (Code of Agrarian Reforms), agricultural share tenancy was declared to be contrary to public policy and was thereby abolished. And Section 4 of R.A. No. 6389, mandates that agricultural share tenancy throughout the country shall automatically be converted to agricultural leasehold.

It is for this reason that your subject query falls within the context of R.A. No. 3844, as amended by R.A. No. 6389, which provides, under Section 34 thereof, that the consideration for the lease of an agricultural land shall not be more than the equivalent of 25% of the average normal harvest during the three (3) agricultural years immediately preceding the date the leasehold was established after deducting the amount used for seeds and the cost of harvesting, threshing, loading, hauling, and processing, whichever are applicable. DAR Administrative Order No. 05, Series of 1993, provides appropriate rules and procedures for the proper implementation of this statutory mandate.

Given the foregoing, while the PLR is pending with the PARAD or RARAD for approval, same shall already, and continue to, be in force. In other words, the tenants-lessees are required to deliver to the owner the consideration of the lease, as fixed by the MARO, in compliance with the tenants' obligation to pay the lease rental when it falls due. In case the owner refuses to accept it, the tenants-lessees may deposit the same with the proper PARAD or RARAD.

We hope to have clarified you on the matter.

Very truly yours,

(SGD.) DANILO T. LARA

Undersecretary for Legal Affairs, and Policy and Planning

Copy furnished:

PARO Alejandro Cruz

DAR Provincial Office

Quezon II

The Municipal Agrarian Reform Officer

DAR Municipal Office

San Francisco, Quezon II