GR 155227; (February, 2011) (Digest)
G.R. No. 155227-28; February 9, 2011
EMILIANA G. PEĂ‘A, AMELIA C. MAR, and CARMEN REYES, Petitioners, vs. SPOUSES ARMANDO TOLENTINO AND LETICIA TOLENTINO, Respondents.
FACTS
Petitioners Emiliana Peña, Amelia Mar, and Carmen Reyes were lessees of three separate parcels of land in Tondo, Manila, owned by respondent spouses Armando and Leticia Tolentino. The oral lease agreements stipulated monthly rents as of October 9, 1995: Peña paid ₱480.00, Mar paid ₱840.00, and Reyes paid ₱570.00. On August 15, 1995, respondents sent demand letters to each petitioner, terminating their month-to-month lease contracts effective September 15, 1995, and demanding they vacate and remove their houses, with a warning to charge ₱3,000.00 monthly as reasonable compensation for use and occupancy from October 1, 1995, if they failed to vacate. After petitioners refused, respondents filed three ejectment complaints on October 9, 1995, in the Metropolitan Trial Court (MeTC) of Manila, which were consolidated. Petitioners contended their ejectment would circumvent Presidential Decree (P.D.) No. 20 and related laws. The agreed issues were: (1) whether petitioners could be ejected on the ground of expiration of the verbal lease contract, and (2) whether the reasonable compensation demanded was exorbitant. The MeTC ruled for respondents, ordering petitioners to vacate, pay monthly reasonable compensation (Peña: ₱2,000.00; Mar: ₱2,500.00; Reyes: ₱2,050.00) from October 1, 1995, until vacated, plus attorney’s fees and costs, holding that leases with monthly rentals were month-to-month and expired after the last day of any thirty-day period upon proper demand. On appeal, the Regional Trial Court (RTC) modified the decision, fixing a two-year lease term from its decision date, ordering petitioners to demolish houses at their expense upon expiration, continue paying old rentals with gradual increases under rent control, and pay costs. The RTC based this on Article 1687 of the Civil Code, considering petitioners had built houses and occupied the premises for over 30 years. Both parties appealed to the Court of Appeals (CA). The CA set aside the RTC decision and reinstated the MeTC decision with modification, ordering petitioners to pay their respective agreed rentals, gradually increased under the Rent Control Law, from October 1, 1995, until vacated. The CA denied petitioners’ motion for reconsideration and granted respondents’ motion for execution pending appeal.
ISSUE
1. Whether the ejectment of petitioners from the leased premises violated P.D. No. 20.
2. Whether petitioners cannot be ejected without violating the Urban Land Reform Code (P.D. 1517) and R.A. 3516.
RULING
The Supreme Court denied the petition, ruling it lacked merit.
1. On the first issue, the Court held that petitioners’ reliance on P.D. No. 20 was futile and misplaced because Batas Pambansa Blg. 25, approved on April 10, 1979, had expressly repealed P.D. No. 20. The controlling rental law when the complaints were filed on October 9, 1995, was Batas Pambansa Blg. 877. Under B.P. Blg. 877, a lease with no specified period but with monthly rentals is considered a lease with a definite period—month-to-month—and expires after the last day of any thirty-day period upon demand by the lessor to vacate, constituting a ground for ejectment under Section 5(f) of B.P. Blg. 877 (expiration of the lease contract). Thus, petitioners could be lawfully ejected upon expiration of their month-to-month leases after proper demand.
2. On the second issue, the Court found petitioners’ invocation of P.D. 1517 and R.A. 3516 untenable. P.D. 1517 (Urban Land Reform Code) applies only to areas proclaimed by the President as Urban Land Reform Zones, and petitioners failed to prove the leased premises were within such a zone. R.A. 3516, which provides for a 10-year lease term for tenants who constructed houses on leased land, had been repealed by P.D. 20, which was itself repealed by B.P. Blg. 25. Therefore, these laws did not bar petitioners’ ejectment.
The Court affirmed the CA decision, reinstating the MeTC judgment with modification as to rental payments, and held that the leases were for a definite period (month-to-month) and expired upon demand, warranting ejectment.