GR 154895; (November, 2004) (Digest)
G.R. No. 154895 ; November 18, 2004
JOSIE GO TAMIO, petitioner, vs. ENCARNACION TICSON, respondent.
FACTS
Respondent Encarnacion Ticson leased an apartment unit to petitioner Josie Go Tamio for three months, representing herself as the owner or authorized lessor based on a waiver of rights executed by Valentine Lim, a child of the original lessee from the Roman Catholic Archbishop of Manila (RCAM). After signing the lease and paying rentals, petitioner discovered RCAM was the true owner. Upon the lease’s expiration, respondent demanded petitioner vacate for her family’s use. Petitioner refused, prompting an unlawful detainer suit. The Metropolitan Trial Court dismissed the complaint, finding respondent guilty of fraudulent concealment, rendering the contract void.
The Regional Trial Court and the Court of Appeals reversed, holding respondent’s misrepresentation was an honest error, not fraud. They found petitioner negligent for not immediately contacting RCAM upon discovery. The CA, while noting petitioner later entered a direct lease with RCAM, ordered her to pay respondent P86,000 in rental arrearages for her occupancy from September 1996 to December 1997.
ISSUE
Whether petitioner is liable to pay respondent the amount of P86,000 as rental arrearages.
RULING
The Supreme Court granted the petition, setting aside the CA decision and reinstating the MTC’s dismissal of the complaint. The Court held respondent acquired no right to sublease the property. The assignment/waiver from Valentine Lim was invalid without the consent of the lessor, RCAM, as expressly required under Article 1649 of the Civil Code. Since the original lease with the Lim family had been terminated for nonpayment, Valentine Lim had no subsisting rights to assign. Consequently, respondent had no legal possession or authority to lease the property to petitioner, making their contract void.
The general rule that a lessee cannot challenge the lessor’s title was deemed inapplicable to prevent unjust enrichment. Requiring petitioner to pay respondent for the period she occupied the unit under a void contract would unjustly enrich respondent, as petitioner had already assumed liability for those same rentals in her subsequent valid contract with RCAM. Equity intervenes to prevent such an inequitable result, ensuring no one profits from a transaction to which they had no legal right.