G.R. No. L-19383; April 30, 1964
UNITED STATES LINES COMPANY, petitioner, vs. SAN MIGUEL BREWERY, INC., respondent.
FACTS
Petitioner United States Lines Company, agent for the vessel S/S “Peter J. McGuire,” leased a compartment in the Insular Ice and Cold Storage Plant operated by respondent San Miguel Brewery, Inc., to store the vessel’s perishable food supplies after the ship’s refrigeration failed. The provisions were stored on November 1, 1951, and withdrawn on November 6, 1951. Upon withdrawal, the foodstuffs were found to be gnawed, soiled, and damaged by rodents, rendering them unfit for consumption and requiring disposal at sea as ordered by a quarantine official.
Subsequently, employees from the Bureau of Quarantine’s Rodent Control Section caught a total of 66 rats inside the same large room containing the leased compartment over a period from November 19 to December 15, 1951. The Court of First Instance of Manila ruled in favor of the petitioner, awarding damages. The Court of Appeals reversed this decision, holding that a lessor is not liable for damages from defects in the leased premises absent fraud or bad faith, citing an inapplicable syllabus from a prior case involving force majeure.
ISSUE
Whether the lessor, San Miguel Brewery, Inc., is liable for damages caused to the lessee’s stored goods by rodents present in the leased cold storage compartment.
RULING
Yes, the lessor is liable. The Supreme Court reversed the Court of Appeals and reinstated the trial court’s judgment. The legal logic proceeds from the nature of the contract. The agreement was a contract of lease. Under Article 1653 of the Civil Code, the provisions on warranty from the Title on Sales are applicable to leases. This incorporates Article 1566, which holds a vendor responsible for hidden faults or defects in the thing sold, even without awareness, unless stipulated otherwise.
The Court found that the presence of rats constituted a hidden defect in the leased premises. The evidence, particularly the capture of 66 rats in the room shortly after the incident, supported the conclusion that the rodents were present at the time of the lease and caused the damage. The warranty of the lessor against such hidden defects is implied by law. The Court of Appeals erred in requiring proof of fraud or bad faith, as its reliance on a syllabus from Yap Kim Chuan v. Tiaoqui was misplaced; that case involved damage from torrential rain (force majeure), not a latent defect in the premises itself. Therefore, the respondent-lessor breached its implied warranty and is liable for the resulting damages to the petitioner-lessee’s goods.