G.R. No. L-58286 May 16, 1983
AGAPITO B. DUCUSIN and AGAPITO T. DUCUSIN, JR., petitioners, vs. HON. COURT OF APPEALS, VIRGILIO S. BALIOLA and LILIA S. BALIOLA, respondents.

FACTS

Petitioner Agapito Ducusin leased a residential apartment unit to respondents Virgilio and Lilia Baliola under a contract stipulating a month-to-month term. The contract expressly provided that the lessor could terminate the lease on the ground that his children needed the premises for their own use or residence. After almost two years, Ducusin sent a notice to terminate the contract, stating his son, Agapito Ducusin Jr., was getting married and needed the apartment. The Baliola spouses refused to vacate. Ducusin filed an ejectment suit, alleging the need of the premises for his son and additional grounds of contract violations by the lessees. The City Court ruled for Ducusin, finding the termination valid based on the contractual stipulation. The Court of First Instance affirmed this decision on appeal.
The Court of Appeals reversed, dismissing the ejectment complaint. It held that Ducusin failed to prove the bona fides of his need, reasoning that he owned an eight-door apartment building and could have allocated another unit to his son. The appellate court found the stated ground for ejectment was a mere pretext to circumvent rental laws, despite the explicit contractual provision allowing termination for the lessor’s children’s need.

ISSUE

Whether the Court of Appeals erred in dismissing the ejectment complaint by disregarding the contractual stipulation allowing termination for the lessor’s children’s need and by misapprehending the facts.

RULING

Yes. The Supreme Court reversed the Court of Appeals and reinstated the trial court’s judgment. The legal logic is anchored on the binding force of contractual obligations and the exceptions to the rule on the conclusiveness of the Court of Appeals’ factual findings. The lease contract explicitly permitted termination if the lessor’s children needed the premises. This stipulation is a resolutory condition that, upon fulfillment, ends the lease by the lessor’s will. Upon sending the notice stating his son’s need due to marriage, Ducusin validly exercised this contractual right. The lessees’ refusal to vacate constituted a violation of their agreement.
The Court of Appeals committed grave abuse of discretion by ignoring this clear contractual basis and substituting its own assessment of the lessor’s available housing options. The Supreme Court found the appellate court’s conclusion—that another unit could be used—was speculative and contradicted by evidence showing all other units were occupied. This misapprehension of facts, which reversed the concurrent findings of the two lower courts, justified a factual review. The Supreme Court emphasized that factual findings of the Court of Appeals are not conclusive when the judgment is based on a misapprehension of facts, ignores competent evidence, or makes inferences manifestly mistaken. Here, the lessor proved a legitimate need under the contract’s terms, warranting ejectment.