Camacho vs. Court of Industrial Relations

Republic Act No. 34, amendatory of Act No. 4054, became effective ipso facto in Pangasinan on September 30, 1946, and governed the 1946-1947 rice crop; an oral share-tenancy contract embodying old customs was invalid in Pangasinan because Act No. 4054 had been in force there since 1937 and required such contracts to be in writing.

The tenant-petitioners, Valentin Camacho, Bonifacio Macaranas, and others, worked rice lands in Sta. Barbara, Pangasinan, owned by respondents Angeles Canson and Teresa Melgar de Carretero. Act No. 4054 governed rice share tenancy and, by its section 4, required share-tenancy contracts to be in writing; section 8 fixed the crop shares in the absence of a written agreement. Commonwealth Act No. 53 allowed a tenant's testimony as prima facie evidence of oral covenants, while Republic Act No. 34 amended section 8 to establish a 70-30 sharing basis and took effect immediately. The dispute required determining which tenancy regime governed the 1946-1947 agricultural year.

Valentin Camacho, Bonifacio Macaranas, and the other petitioners were tenants of rice lands in Sta. Barbara, Pangasinan, owned by respondents Angeles Canson and Teresa Melgar de Carretero. The tenancy concerned palay planted in the haciendas during the 1946-1947 agricultural year. No written share-tenancy contract was executed between the parties.

The parties had observed an oral tenancy-sharing arrangement embodying old customs prior to the 1945-1946 agricultural year. The Court of Industrial Relations found that this oral contract embodied the old customs of tenancy sharing observed by the parties. The crop in question was planted in May and harvested from October to December 1946 and in January 1947.

The tenants owned the work animals and necessary implements, defrayed the cost of plowing and cultivation, and the costs of harvesting and threshing were deducted from the gross produce. These facts were found by the lower court and were material to the application of section 8 of Act No. 4054, as amended by Republic Act No. 34.

• Validity of Oral Tenancy Contract: Respondent Court of Industrial Relations maintained that although Act No. 4054 had been proclaimed effective in Pangasinan in January 1937, Commonwealth Act No. 53 recognized an oral contract despite section 4 of Act No. 4054; because the parties had an oral contract embodying old tenancy-sharing customs observed prior to the 1945-1946 agricultural year, that oral contract governed their shares.
• Non-Impairment and Effectivity of Republic Act No. 34: Respondent Court of Industrial Relations argued that Republic Act No. 34, which amended Act No. 4054, could not be applied to the tenancy relation without impairing the obligations of contract and infringing the Constitution; it treated Republic Act No. 34 as effective in Pangasinan only on November 12, 1946, the date of Proclamation No. 14, and not before.

• Validity of Oral Tenancy Contract: Whether an oral tenancy contract embodying old customs was valid and binding in Pangasinan during the 1946-1947 agricultural year despite section 4 of Act No. 4054 requiring share-tenancy contracts to be in writing, in light of Commonwealth Act No. 53.
• Effectivity of Republic Act No. 34: Whether Republic Act No. 34 became effective in Pangasinan on September 30, 1946, the date of its passage, or only on November 12, 1946, the date of Proclamation No. 14.
• Retroactivity and Impairment: Whether applying Republic Act No. 34 to the 1946-1947 rice crop gave it retroactive effect or impaired the obligations of contract or vested rights.
• Compliance with Section 8, as Amended: Whether the conditions of section 8 of Act No. 4054, as amended by section 3 of Republic Act No. 34, were complied with so as to warrant the Tenancy Division's 70-30 division.

• Validity of Oral Tenancy Contract: No. Section 4 of Act No. 4054 required share-tenancy contracts to be in writing; Commonwealth Act No. 53 did not impliedly repeal or modify that requirement, and no valid oral tenancy contract could exist in Pangasinan, where Act No. 4054 had been in force since 1937.
• Effectivity of Republic Act No. 34: September 30, 1946. Republic Act No. 34 became effective ipso facto in Pangasinan on the date of its passage; Proclamation No. 14 applied only to territories where Act No. 4054 had not yet been declared in force.
• Retroactivity and Impairment: No. The crop was planted in May and harvested from October to December 1946 and January 1947; Republic Act No. 34 was already effective on September 30, 1946, and no valid contract or vested right existed under the old section 8 before amendment.
• Compliance with Section 8, as Amended: Yes. The conditions of section 8, as amended, were satisfied because the tenants owned the work animals and implements, defrayed the cost of plowing and cultivation, and the costs of harvesting and threshing were deducted from the gross produce; the Tenancy Division's application of Republic Act No. 34 was ordered carried out.

• Validity of Oral Tenancy Contract: Section 4 of Act No. 4054 expressly required a share-tenancy contract, to be valid and binding, to be in writing, drawn in triplicate in a language known to all parties, and signed or thumbmarked by both landlord and tenant before two witnesses. Commonwealth Act No. 53, which allowed a tenant's testimony as prima facie evidence of the terms of an oral covenant, was a general law and did not mention Act No. 4054. Because repeal by implication is not favored and a subsequent general law should not be construed to repeal or modify a prior special law, the two statutes had to be harmonized. Commonwealth Act No. 53 therefore applied to tenancy contracts on other agricultural products and to rice tenancy in provinces where Act No. 4054 had not yet been made effective, but not to Pangasinan, where Act No. 4054 had been in force since January 1937. Since oral contracts were invalid there, no evidence could prove the legal existence and terms of the alleged oral contract, and the rice-sharing tenancy had to be governed by section 8 of Act No. 4054 and its amendments since 1937.
• Effectivity of Republic Act No. 34: Proclamation No. 14, declaring Act No. 4054 as amended to be in full force throughout the Philippines, was intended for territories where the Act had not yet been declared in force, not for Pangasinan, where Act No. 4054 had already been effective since January 1937 and that proclamation had never been set aside or suspended. Section 4 of Republic Act No. 34 provided that it would take effect immediately, and it was passed and approved on September 30, 1946. A statute taking immediate effect is operative from the exact instance it becomes law, and an amendment to a law already in force in a territory becomes effective there as part of the amended law when the amendment takes effect. Republic Act No. 34 thus became effective in Pangasinan on September 30, 1946, not on the date of Proclamation No. 14.
• Retroactivity and Impairment: Section 6 of Act No. 4054 defined "agricultural year" as the length of time necessary for preparation of the land, sowing, planting, and harvesting a crop. The crop in question was planted in May and harvested from October to December 1946 and January 1947, so applying Republic Act No. 34 to the 1946-1947 crop did not give it retrospective effect; a statute is not retrospective merely because it draws on antecedent facts for its operation. Even if the application were considered retroactive, the Constitution does not prohibit retrospective laws that do not impair the obligations of contract or deprive persons of property without due process. No valid oral or written tenancy contract existed before Republic Act No. 34 took effect, and no vested right over the 1946-1947 rice crop had been acquired under the old section 8 before amendment; hence no contractual obligation or vested right was impaired.
• Compliance with Section 8, as Amended: The conditions set forth in section 8 of Act No. 4054, as amended by section 3 of Republic Act No. 34, were complied with as found by the lower court: the tenants owned the work animals and necessary implements, defrayed the cost of plowing and cultivation, and the costs of harvesting and threshing were deducted from the gross produce. The Tenancy Law Enforcement Division's decision, insofar as it applied Republic Act No. 34 to the case, was therefore to be carried out.

• Repeal by Implication; General vs. Special Law — A subsequent general law is not construed to repeal or modify a prior special law; repeal by implication is not favored, and the statutes must be harmonized if possible. Commonwealth Act No. 53, a general law on oral tenancy covenants, did not impliedly repeal section 4 of Act No. 4054, the special law requiring written share-tenancy contracts.
• Effectivity of an Amendatory Law — An amendment to a law already in force in a territory becomes effective therein as part of the amended law when the amendment takes effect; a statute that is to take immediate effect is operative from the exact instance it becomes law. Republic Act No. 34 thus took effect in Pangasinan on September 30, 1946, not on the date of Proclamation No. 14.
• Retroactive Statute — A retrospective or retroactive law creates a new obligation, imposes a new duty, or attaches a new disability in respect to a transaction already past; a statute is not retrospective merely because it draws on antecedent facts for its operation. Republic Act No. 34 was not retroactive as applied to the 1946-1947 crop because the crop was planted and harvested after the Act took effect.
• Non-Impairment and Vested Rights — The Constitution does not prohibit retrospective laws that do not impair the obligations of contract or deprive a person of property without due process; absent a valid contract or vested right before the amendatory law took effect, no impairment results. No valid tenancy contract or vested right over the 1946-1947 crop existed before Republic Act No. 34.
• Written Share-Tenancy Contract Requirement — Under section 4 of Act No. 4054, a share-tenancy contract must be in writing, drawn in triplicate in a language known to all parties, and signed or thumbmarked by the landlord and tenant before two witnesses. Where Act No. 4054 was in force, an oral tenancy contract was invalid and could not be proved.
• Social Justice and Legislative Intent — The Constitution mandates Congress to regulate relations between landowners and tenants and makes social justice a concern of the State; legislative history and executive messages may be considered in interpreting legislative intent. These considerations supported applying Republic Act No. 34 to the 1946-1947 rice crop.

• "It is elementary rule that a subsequent general law should not be construed to repeal or modify a prior special law; and that repeal by implication is not favored, and therefore the former and subsequent act must if possible, be construed as to give effect to both." — This states the statutory-construction basis for harmonizing Commonwealth Act No. 53 with section 4 of Act No. 4054, so that the latter's written-contract requirement remained effective in Pangasinan.
• "The provisions of Act No. 4054, which provides in its section 4 that an oral contract or share tenancy is not valid and binding, having been in the force in the province of Pangasinan since January 20, 1937, there could not legally exist an effective oral contract between the parties embodying the old customs of tenancy sharing observed by the parties prior to 1945-1946 agricultural year, and therefore the rice sharing tenancy between the parties must be governed since the year 1937 by the provisions of section 8 of Act No. 4054 and its amendments." — This is the ratio on the invalidity of the oral contract and the governing law.
• "It is therefore clear that Act No. 34, amendatory of said Act No. 4054, became effective ipso facto in Pangasinan since the date of its passage, September 30, 1946, on which, according to the express provision of section 4 therefore, it became effective; because an amendment of a law being a part of the original which is already in force and effect in a certain territory, must necessarily become effective therein as a part of the amended law at the time the amendment takes effect." — This fixes the effectivity of Republic Act No. 34 in Pangasinan.
• "And it is a well established rule recognized by all authorities without exception, that a retrospective or retroactive law is that which creates a new obligation, imposes a new duty or attaches a new disability in respect to a transaction already past; but that statute is not made retrospective because it drawns on antecedent facts for its operation, or in other words part of the requirements for its action and application is drawn from a time antedating its passage" — This defines retroactive law and supports applying Republic Act No. 34 to the 1946-1947 crop without retroactive effect.

• Section 4, Act No. 4054 — Required share-tenancy contracts to be valid and binding to be in writing, drawn in triplicate in a language known to all parties, and signed or thumbmarked by the landlord or authorized representative and tenant before two witnesses. Because Act No. 4054 was in force in Pangasinan since 1937, the alleged oral contract was invalid.
• Section 8, Act No. 4054 — Provided the share basis in the absence of a written agreement, including equal division when the tenant furnished implements and work animals and expenses were borne equally. It governed the parties' rice-sharing tenancy since 1937 until amended.
• Section 3, Republic Act No. 34 — Amended section 8 of Act No. 4054 and established the sharing basis applied by the Tenancy Law Enforcement Division; the conditions for its application were found complied with, leading to the 70-30 division in favor of petitioners after deducting harvesting and threshing expenses.
• Section 4, Republic Act No. 34 — Provided that the Act would take effect immediately; because it was approved on September 30, 1946, it became operative in Pangasinan on that date.
• Section 1, Commonwealth Act No. 53 — Provided that where a covenant or contract between landowner and lessee or tenant on shares was not reduced to writing or not in a language known to the tenant, the tenant's testimony would be accepted as prima facie evidence of its terms. It did not, however, validate oral rice tenancy contracts in provinces where Act No. 4054 was already in force.
• Section 6, Act No. 4054 — Defined "agricultural year" as the length of time necessary for preparation of the land, sowing, planting, and harvesting a crop. This definition supported the conclusion that applying Republic Act No. 34 to the 1946-1947 crop was not retroactive.
• Section 6, Article XIV, Constitution — Ordained Congress to regulate relations between landowners and tenants. It supported the legislative power exercised through Republic Act No. 34.
• Section 5, Article II, Constitution — Declared that the promotion of social justice to insure the well-being and economic security of all people should be the concern of the State. It formed part of the constitutional backdrop for applying the tenancy amendment.

Moran, C.J.; Paras; Pablo; Perfecto; Briones; and Padilla, JJ.

• Justice Hilado — Dissented. The governing law at the time the crop was planted, from May to July 1946, was section 8 of Act No. 4054, which had been effective in Pangasinan since January 1937. In the absence of a written contract, the crop should be divided on the old 50-50 basis, with the landlord reimbursing the tenants for one-half of planting and cultivation expenses and the tenants reimbursing the landlord for one-half of the seeds supplied. Republic Act No. 34 and Proclamation No. 14 should not apply to crops already planted under the former law; section 4 of Republic Act No. 34 showed only prospective effect, and neither the Act nor the Proclamation expressly made it retroactive. Changing the sharing basis after the parties had acted and the crops were nearing harvest would be an unjust ex post facto change, not justified by social justice, and could prejudice tenants by discouraging landlords from leasing land.
• Justice Bengzon — Joined the dissent, believing that the law should not apply to contracts already existing at the time of its approval.
• Justice Tuason — Concurred in Justice Hilado's dissenting opinion.