G.R. No. 83959 ; April 8, 1991
RUPERTO DE GUZMAN, petitioner, vs. THE HONORABLE COURT OF APPEALS and DR. FORTUNATO V. CORREA, respondents.

FACTS

Petitioner Ruperto de Guzman was the tenant of a rice mill and warehouse owned by the late Teodora Villarama, mother of private respondent Fortunato V. Correa. After the written lease contract expired on April 29, 1975, private respondent allegedly took over management and an oral month-to-month lease was agreed upon. Petitioner failed to pay rentals for May and June 1977, prompting private respondent to demand that he vacate the premises. Upon petitioner’s refusal, private respondent filed an ejectment case (Civil Case No. 183) before the Municipal Trial Court (MTC) of Angat, Bulacan, which ruled in favor of private respondent. Petitioner later filed a petition for relief and a separate special civil action (SM-960) before the then Court of First Instance (CFI), which declared the MTC proceedings in Civil Case No. 183 null and void due to lack of the requisite demand under the Rules. Subsequently, private respondent filed a second ejectment case (Civil Case No. 286) before the MTC, which again ordered petitioner’s ejectment and awarded rentals, moral and exemplary damages, and attorney’s fees. Petitioner appealed to the Regional Trial Court (RTC), which affirmed the MTC decision. The Court of Appeals dismissed petitioner’s subsequent petition, prompting this review.

ISSUE

Whether the Court of Appeals erred in affirming the RTC decision which sustained the MTC’s judgment in the second ejectment case, particularly regarding jurisdiction, litis pendentia, and the awards for damages.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals’ decision with modification. The Court held that the dismissal of the first ejectment case (Civil Case No. 183) by the CFI in SM-960 was not an adjudication on the merits but was based on a jurisdictional defect (lack of demand). Therefore, the principle of litis pendentia did not bar the filing of the second ejectment case, as a prerequisite for litis pendentia is that the court in the first case had jurisdiction over the subject matter. The Court also ruled that the original written lease contract expired automatically at the end of its term without need of demand, and petitioner failed to establish any right to continue occupancy after its expiration and his failure to pay rentals. However, the Court modified the appealed decision by deleting the awards for moral and exemplary damages. It reiterated the settled doctrine that the only damages recoverable in an ejectment suit are the fair rental value or reasonable compensation for the use and occupation of the property. The award of attorney’s fees was sustained as petitioner failed to rebut its propriety in the lower court.