G.R. No. 205539 October 4, 2017
VELIA J. CRUZ, Petitioner vs. SPOUSES MAXIMO and SUSAN CHRISTENSEN, Respondents

FACTS

Petitioner Velia J. Cruz inherited a property in San Juan City, which respondent Susan Christensen had occupied under a verbal month-to-month lease agreement since the time of Cruz’s mother. Cruz alleged that Christensen failed to pay rentals and, after barangay conciliation failed, sent a final demand letter via registered mail in August 2008, demanding payment and to vacate within 15 days. Christensen admitted occupancy but denied rental arrears and receipt of the demand letter, claiming the signature on the registry return card was not hers. Cruz filed an unlawful detainer complaint in April 2009.
The Metropolitan Trial Court dismissed the complaint, finding Cruz failed to prove valid service of the demand letter as the registry return card lacked authentication. The Regional Trial Court reversed, holding the registry return card constituted proof of receipt, outweighing a bare denial. The Court of Appeals reinstated the MeTC dismissal, ruling that Cruz’s late filing of her memorandum on appeal was a fatal procedural defect and that the registry receipts were insufficient proof of service.

ISSUE

The core issue is whether a prior demand to vacate is indispensable for an unlawful detainer action when the basis for the ejectment is the expiration of the lease term, not breach of conditions like non-payment of rent.

RULING

The Supreme Court granted the petition and reversed the Court of Appeals. The Court clarified the distinction between two grounds for unlawful detainer under Rule 70 of the Rules of Court. The requirement of a prior demand to vacate is necessary only when the action is based on the tenant’s failure to pay rent or to comply with the lease conditions. However, when the action is premised on the expiration of the lease term—such as a month-to-month lease terminable at the end of any month—no such demand is required by law. The filing of the complaint itself constitutes the final demand.
In this case, the complaint alleged a month-to-month lease. Therefore, the cause of action accrued upon the lessor’s act of terminating the lease by filing the ejectment suit. The Court found the lower courts erroneously focused on the validity of the extrajudicial demand letter. Since the lease was terminable at the end of any month, the necessity of proving service of that demand was rendered moot. The procedural lapse regarding the memorandum on appeal was also deemed non-prejudicial, as the RTC had validly exercised its discretion to decide the appeal on its merits. The case was remanded to the MeTC for proper proceedings to determine the factual issue of whether the lease was indeed month-to-month, which would dictate if a prior demand was legally required.