Chan v. Montejo
REITERATIONFacts
1. The Antecedents: The underlying dispute concerns the possession of two parcels of land, lots 36 and 38 of Zamboanga City, which were leased to Juanito Chan by Jesusa Vda. de Murga. The lease, initially for ten years from January 31, 1949, contained a clause granting the lessor the option to purchase the lessee's buildings upon expiration, or to renew the lease with adjusted rental terms. After the initial term expired, negotiations for a new lease, particularly regarding the rental amount, failed. Consequently, the lessor filed an unlawful detainer action to recover possession of the land. 2. Procedural History: The unlawful detainer case was initially decided by the Municipal Court of Zamboanga City in favor of the lessor, ordering the lessee to vacate the premises and pay a monthly rental of P600.00 from February 1, 1959, along with attorney's fees and costs. The lessee appealed this decision to the Court of First Instance of Zamboanga City. While the appeal was pending, the lessor filed a motion for the execution of the Municipal Court's judgment, alleging that the lessee had failed to deposit the difference of P100.00 monthly (between the original P500.00 stipulated rent and the P600.00 adjudged rent) on or before the 10th day of each month from February to July 1964. The lessee opposed this motion, arguing that the lessor had accepted the P500.00 monthly rent and that he had subsequently deposited the total difference of P600.00. The Court of First Instance granted the motion for execution. 3. The Petition: Juanito Chan filed an original petition for certiorari with preliminary injunction before the Supreme Court, seeking to review and set aside the order of the respondent judge of the Court of First Instance of Zamboanga City, which ordered the execution of the Municipal Court's judgment pending appeal. The petitioner argued that the respondent judge erred in ordering execution despite the lessor's acceptance of the lower rental amount and the subsequent deposit of the difference, contending that the lessor had waived her right to demand immediate execution. The petition also highlighted the potential irreparable damage to the petitioner's buildings, valued at P70,000.00, should the execution proceed.
Issue(s)
Whether the respondent judge committed a grave abuse of discretion in ordering the execution of the Municipal Court's judgment pending appeal, despite the plaintiff's alleged waiver of the right to demand the full adjudged monthly rental. Whether the failure to deposit the P100.00 monthly difference between the stipulated and adjudged rental, while paying the stipulated rental and subsequently depositing the difference, warrants execution pending appeal.
Ruling
The Supreme Court granted the writ of certiorari, set aside the order of execution, and made the preliminary injunction permanent. The Court ruled that the respondent judge committed a grave abuse of discretion.
Ratio Decidendi
On Issue 1: The Supreme Court held that while Sections 8 and 9 of Rule 72 of the Rules of Court provide for execution if the tenant fails to pay or deposit the adjudged rent on or before the 10th day of each month, this right can be waived by the landlord. In this case, the plaintiff accepted the stipulated rental of P500.00 monthly from February to July 1964, acceding to the defendant's plea, without demanding the P100.00 difference adjudged by the Municipal Court. This conduct, coupled with the defendant's subsequent deposit of the P600.00 on July 10, 1964, which covered the unpaid difference, indicated that the plaintiff had waived her right to demand the full amount for the purpose of staying execution. The Court found that the plaintiff suffered no material damage or prejudice. On Issue 2: The Court found that the respondent judge erred in ordering execution. Although the defendant failed to deposit the P100.00 difference monthly within the prescribed period, his payment of the P500.00 stipulated rental and the subsequent deposit of the full P600.00 on July 10, 1964, before the execution order was issued, demonstrated good faith. The Court invoked equity, noting that the defendant would suffer irreparable damage if his buildings, valued at P70,000.00, were demolished. The failure to deposit the adjudged rent in full was deemed not fatal under the special circumstances, as the landlord had effectively waived her right to demand it for the purpose of execution pending appeal.
Main Doctrine
The Supreme Court reiterated that while Sections 8 and 9 of Rule 72 of the Rules of Court mandate the tenant to pay or deposit the adjudged monthly rental on or before the 10th day of each calendar month to stay execution, this right can be waived by the landlord. The Court found that the landlord, by accepting the stipulated rental of P500.00 monthly without protest and without demanding the P100.00 difference adjudged by the Municipal Court, implicitly waived her right to demand immediate execution. Furthermore, the tenant's subsequent deposit of the full adjudged rental amount before the execution order was issued, coupled with the fact that the landlord suffered no material damage, justified the setting aside of the execution order on equitable grounds.