CMS Investments and Management Corporation v. Intermediate Appellate Court
REITERATIONFacts
1. The Antecedents: The underlying dispute arose from a lease agreement between CMS Investments and Management Corporation (CMS) and Jose Tan. Tan alleged an oral ten-year lease agreement starting January 24, 1978, for a parcel of land where he operated a business. He claimed to have paid rentals through November 20, 1982. On June 1, 1982, CMS, through its representative, allegedly informed Tan to vacate. Subsequently, on June 8, 1982, Tan discovered the premises padlocked, preventing him from accessing his business, which he claimed caused him significant damage. 2. Procedural History: On June 9, 1982, Jose Tan filed a complaint for damages with a preliminary mandatory injunction against CMS and its representatives in the Court of First Instance of Rizal. The court granted the injunction on June 10, 1982. CMS moved to dissolve the injunction, arguing the court lacked jurisdiction and that the case was essentially one of forcible entry, belonging to the municipal court. On June 30, 1982, CMS filed a petition for certiorari and prohibition with the Intermediate Appellate Court (IAC) seeking to stop the lower court proceedings and to prevent Tan from disturbing their possession. The IAC, in a decision dated May 10, 1983, denied CMS's petition, affirming the lower court's jurisdiction and finding that Tan had not lost possession but was merely disturbed. Following this, Tan filed a motion for preliminary injunction in the lower court, which was set for hearing. The Supreme Court subsequently issued a temporary restraining order on July 8, 1983, preventing further proceedings in the lower court. 3. The Petition: This case is a petition for review on certiorari filed by CMS Investments and Management Corporation and Luis F. Sison. They seek to overturn the decision of the Intermediate Appellate Court, which affirmed the jurisdiction of the Court of First Instance of Rizal over Civil Case No. PQ-0133-P. Petitioners argue that the original complaint filed by Jose Tan was fundamentally a forcible entry case, thus falling under the exclusive jurisdiction of the municipal court, and that the Court of First Instance erred in assuming jurisdiction. They also contend that their actions of padlocking and fencing the premises were justified due to the alleged expiration of the lease agreement and Tan's failure to vacate after notice. The petition also addresses the demolition of Tan's buildings on June 16, 1984, by petitioners, asserting it did not violate the Supreme Court's temporary restraining order issued on July 8, 1983, as the order did not explicitly name them.
Issue(s)
Whether the Court of First Instance has jurisdiction over a complaint for damages with preliminary mandatory injunction filed by a lessee against a lessor for allegedly violating the lessee's peaceful enjoyment of the leased premises. Whether the petitioners' act of padlocking and fencing the leased premises constituted a violation of the lessor's obligation to maintain the lessee in the peaceful and adequate enjoyment of the lease. Whether the petitioners' demolition of the private respondent's building constituted contempt of court.
Ruling
The Supreme Court dismissed the petition, upheld the decision of the Intermediate Appellate Court, and lifted the temporary restraining order. The Court affirmed the jurisdiction of the Court of First Instance over the original case for damages with preliminary mandatory injunction.
Ratio Decidendi
On the jurisdiction of the Court of First Instance: The Court held that the original case filed by the private respondent was not an ejectment case but an action for "damages with preliminary mandatory injunction." This is an entirely different action from forcible entry, which is within the jurisdiction of the Municipal Court. The petitioners' contention that the complaint lacked a cause of action for damages and was intrinsically one of forcible entry was without merit. Article 1659 of the New Civil Code explicitly allows the aggrieved party to ask for rescission of the contract and indemnification for damages, or only indemnification for damages, allowing the contract to remain in force. The private respondent opted for the latter remedy. The act of padlocking and fencing the leased premises by the petitioners, as lessors, was a clear violation of their obligation under Article 1654(3) of the New Civil Code to maintain the lessee in the peaceful and adequate enjoyment of the lease for the entire duration of the contract. The lessee had complied with his obligations under Article 1657, and the oral contract of lease was for a ten-year period, with only four years having elapsed when the alleged violation occurred. Therefore, the private respondent was the aggrieved party, and the CFI's assumption of jurisdiction was warranted. On the violation of the lessee's peaceful enjoyment: The Court found that the act of padlocking the offices and enclosing the leased land with barbed wire by the petitioners constituted a clear violation of their obligation as lessors under Article 1654(3) of the New Civil Code. This article mandates that the lessor must maintain the lessee in the peaceful and adequate enjoyment of the lease for the entire duration of the contract. The comment of Manresa, cited in Goldstein vs. Roces, emphasizes that the lessor must guarantee the lessee's right and protect them in their peaceful enjoyment, not only from third parties but also from the lessor's own acts. By forcibly ejecting the private respondent instead of resorting to legal action to recover possession, the petitioners took the law into their own hands, thereby violating their contractual and legal obligations. On the alleged contempt of court: The Court clarified that the temporary restraining order (TRO) issued on July 8, 1983, was directed at Judge Ansberto Paredes, his agents, representatives, and any person acting upon his orders, restraining them from further proceeding with Civil Case No. 3759. The TRO did not explicitly include the petitioners herein. Therefore, the petitioners' action in demolishing the structure on June 16, 1984, was not a violation of the said TRO. The Court reiterated that contempt partakes of the nature of a criminal offense, and doubts must be resolved in favor of the accused. A person cannot be punished for contempt for doing something not prohibited or omitting an act not required.
Main Doctrine
A complaint for damages with preliminary mandatory injunction, arising from a lessor's alleged violation of the lessee's peaceful enjoyment of the leased premises, falls within the jurisdiction of the Court of First Instance, and is distinct from an action for forcible entry which is cognizable by the Municipal Court.