G.R. No. L-48419 October 27, 1983
EDUARDO M. LESACA, petitioner, vs. HON. SERAFIN R. CUEVAS, as Judge CFI of Manila, Branch IV, ET AL., respondents.

FACTS

Petitioner Eduardo Lesaca owned two properties leased to respondent Tan Chun on a month-to-month basis. On April 15, 1974, Lesaca notified Tan Chun of a 50% rental increase, later reduced to 25%, effective May 1, 1974. On May 12, 1975, Lesaca’s counsel sent letters demanding payment of the increased rental for May 1975 or, alternatively, to vacate the premises by June 15, 1975, stating the month-to-month lease was terminated effective May 1975. Tan Chun responded by sending checks for June 1975 rentals but computed at the old rates. Lesaca then filed an ejectment case before the City Court of Manila, which ruled in his favor, ordering Tan Chun to vacate and pay the increased rentals.
On appeal, the Court of First Instance reversed the City Court’s decision, dismissing the complaint for lack of jurisdiction. The CFI held that the demand sent was insufficient under Section 2, Rule 70 of the Rules of Court, as it was an alternative demand to pay the increased rental or vacate, similar to the demand in Vda. de Murga v. Chan. The CFI ruled that a more definite and unconditional demand to vacate was required to confer jurisdiction in an unlawful detainer case, which was absent.

ISSUE

Whether a prior demand to vacate, as required by Section 2, Rule 70 of the Rules of Court, is necessary for an ejectment suit when the lease is on a month-to-month basis and was terminated due to the lessee’s refusal to pay a validly increased rental.

RULING

No, a specific demand to vacate under Section 2, Rule 70 is not required under the circumstances. The Supreme Court reversed the CFI decision, reinstating the City Court’s judgment. The legal logic is twofold. First, a lease on a month-to-month basis provides a definite period terminable at the end of any month. Upon Tan Chun’s refusal to pay the increased rental for May 1975, the lease contract was deemed terminated as of that month. An action for ejectment thereafter is founded on the expiration of the lease term, not on failure to pay rent or comply with lease conditions. Under jurisprudence, notably Co Tiamco v. Diaz, a demand is a prerequisite only for actions based on failure to pay rent or comply with conditions, not for actions based on termination due to expiration of the term.
Second, even assuming a demand was necessary, the alternative demand given was sufficient. Since the lessee lost any right to remain upon the lease’s expiration in May 1975, his continued possession became unlawful. The demand to pay the increased rental or vacate was a clear notice to terminate his occupancy. The Court, citing PNB v. Animas, construed such a demand as sufficient to render possession illegal. The CFI erred in applying Vda. de Murga, as that case involved a lease with an automatic renewal clause, necessitating a definite demand to prevent renewal. Here, no such clause existed; the lessor validly terminated the lease, and the lessee’s refusal to vacate made him a deforciant subject to ejectment without need for a more specific demand.