Property Registration Decree and Related Laws

Section 33

Any citizen of lawful age of the Philippines, and any corporation or association of which at least sixty per centum of the capital stock or of any interest in said capital stock belongs wholly to citizens of the Philippines, and which is organized and constituted under the laws of the Philippines, may lease any tract of agricultural public land available for lease under the provisions of this Act, not exceeding a total of one thousand and twenty-four hectares. If the land leased is adapted to and be devoted for grazing purposes, an area not exceeding two thousand hectares may be granted. No member, stockholder, officer, representative, attorney, agent, employee or bondholder of any corporation or association holding or controlling agricultural public land shall apply, directly or indirectly, for agricultural public land except under the homestead and free patent provisions of this Act: Provided, That no lease shall be permitted to interfere with any prior claim by settlement or occupation, until the consent of the occupant or settler is first had, or until such claim shall be legally extinguished, and no person, corporation, or association shall be permitted to lease lands hereunder which are not reasonably necessary to carry on his business in case of an individual, or the business for which it was lawfully created and which it may lawfully pursue in the Philippines, if an association or corporation.

Section 34

A notice of the date and place of the auction of the right to lease the land shall be published and announced in the same manner as that prescribed for the publication and announcement of the notice of sale, in section twenty-four of this Act.

Section 35

All bids must be sealed and addressed to the Director of Lands, and must have enclosed therewith cash or a certified check, Treasury warrant, or post-office money order payable to the order of the Director of Lands, for a sum equivalent to the rental for at least the first three months of the lease: Provided, That no bid shall be considered in which the proposed annual rental is less than three per centum of the value of the land according to the appraisal made in conformity with section one hundred and sixteen of this Act.

Section 36

The auction of the right to lease the land shall be conducted under the same procedure as that prescribed for the auction sale of agricultural lands as prescribed in section twenty-six of this Act: Provided, That no bid shall be accepted until the bidder shall have deposited the rental for at least the first three months of the lease.

Section 37

The annual rental of the land leased shall not be less than three per centum of the value of the land, according to the appraisal and reappraisal made in accordance with section one hundred sixteen of this Act; except for lands reclaimed by the Government, which shall not be less than four per centum of the appraised and reappraised value of the land: Provided, That one-fourth of the annual rental of these lands reclaimed prior to the approval of this Act shall accrue to the construction and improvement portion of the Portworks Fund: And provided, further, That the annual rental of not less than four per centum of the appraised and reappraised value of the lands reclaimed using the Portworks Fund after the approval of this Act shall all accrue to the construction and improvement portion of the Portworks Fund. But if the land leased is adapted to and be devoted for grazing purposes, the annual rental shall be not less than two per centum of the appraised and reappraised value thereof. Every contract of lease under the provisions of this chapter shall contain a clause to the effect that a reappraisal of the land leased shall be made every ten years from the date of the approval of the lease, if the term of the same shall be in excess of ten years. In case the lessee is not agreeable to the reappraisal and prefers to give up his contract of lease, he shall notify the Director of Lands of his desire within the six months next preceding the date on which the reappraisal takes effect, and in case his request is approved, the Director of Lands may, if the lessee should so desire, proceed in accordance with section one hundred of this Act. (Amending C.A. No. 141 Re: Land Rentals, Republic Act No. 2694, [June 18, 1960]) The rent, which shall be paid yearly in advance, shall accrue from the date of the approval of the lease, and the full payment for the year shall be made in the Bureau of Lands before the execution of the contract.

Section 38

Leases shall run for a period of not more than twenty-five years, but may be renewed once for another period of not to exceed twenty-five years, in case the lessee shall have made important improvements which, in the discretion of the Secretary of Agriculture and Commerce, justify a renewal. Upon the final expiration of the lease, all buildings and other permanent improvements made by the lessee, his heirs, executors, administrators, successors, or assigns shall become the property of the Government, and the land together with the said improvements shall be disposed of in accordance with the provisions of chapter five of this Act.

Section 39

It shall be an inherent and essential condition of the lease that the lessee shall have not less than one-third of the land broken and cultivated within five years after the date of the approval of the lease: Provided, however, That in case the land leased is to be devoted to pasture, it shall be sufficient compliance with this condition if the lessee shall graze on the land as many heads of cattle as will occupy at least one-half of the entire area at the rate of one head per hectare.

Section 40

The lessee shall not assign, encumber, or sublet his rights without the consent of the Secretary of Agriculture and Commerce, and the violation of this condition shall avoid the contract: Provided, That assignment, encumbrance, or subletting for purposes of speculation shall not be permitted in any case: Provided, further, That nothing contained in this section shall be understood or construed to permit the assignment, encumbrance, or subletting of lands leased under this Act, or under any previous Act, to persons, corporations, or associations which under this Act, are not authorized to lease public lands.

Section 41

The lease of any lands under this chapter shall not confer the right to remove or dispose of any valuable timber except as provided in the regulations of the Bureau of Forestry for cutting timber upon such lands. Nor shall such lease confer the right to remove or dispose of stone, oil, coal, salts, or other minerals, or medicinal mineral waters existing upon the same. The lease as to the part of the land which shall be mineral may be cancelled by the Secretary of Agriculture and Commerce, after notice to the lessee, whenever the said part of the land is more valuable for mineral than for agricultural purposes. The commission of waste or the violation of the forestry regulations by the lessee shall work a forfeiture of his last payment of rent and render him liable to immediate dispossession and suit for damage.

Section 42

After having paid rent for at least the first two years of the lease, and having complied with the requirements prescribed in section thirty-nine, the lessee of agricultural public land with an area less than the maximum allowed by law, may lease successively additional agricultural public land adjacent to or near the land originally leased until the total area of such leases shall reach the maximum established in this chapter: Provided, That in making such lease, the same conditions shall be complied with as prescribed by this Act for the first lease.

Section 43

During the life of the lease, any lessee who shall have complied with all the conditions thereof and shall have the qualifications required by section twenty-two, shall have the option of purchasing the land leased subject to the restrictions of chapter five of this Act.