De Vera v. Court of Appeals
REITERATIONFacts
The Antecedents: Petitioner Consolacion de Vera was a tenant of an apartment unit leased in 1967 from the original owner, paying monthly rentals that increased over time. In 1990, the apartment was sold to respondent Quayalay Realty Corporation. The original owner notified petitioner that the month-to-month lease would not be renewed upon its expiration on December 30, 1990. Respondent Quayalay Realty subsequently asked petitioner to vacate by January 5, 1991. Petitioner requested more time, but her request was denied. Procedural History: As petitioner and other lessees refused to vacate, Quayalay Realty filed ejectment suits. The Metropolitan Trial Court (MeTC) ruled in favor of Quayalay Realty, holding that the month-to-month lease had expired and was not renewed, ordering petitioner to vacate and pay rentals and attorney's fees. The Regional Trial Court (RTC) affirmed the MeTC decision but increased attorney's fees. The Court of Appeals (CA) affirmed the RTC decision but deleted the award of attorney's fees. Petitioner's motion for reconsideration was dismissed. The Petition: Petitioner filed a petition for review on certiorari, alleging that the CA erred in concluding that her verbal contract of lease was for a definite period, in not holding that the owner-lessor cannot eject the tenant by reason of expiration of the lease period under Article 1687 of the Civil Code, and in not appreciating that the respondent was aware of the existing indefinite lease contract.
Issue(s)
Whether the verbal contract of lease is one with a definite period. Whether the owner-lessor can eject the tenant by reason of expiration of the period of lease under Article 1687 of the Civil Code, independently of the grounds for judicial ejectment under Batas Pambansa Blg. 877. Whether the private respondent, as the new owner, is bound to respect the existing lease contract. Whether the Court of Appeals erred in not holding that it could fix the term for the lease only if prayed for in the complaint.
Ruling
The petition is denied, and the decision of the Court of Appeals is affirmed.
Ratio Decidendi
On the issue of whether the verbal contract of lease is one with a definite period: The Court held that a lease on a month-to-month basis is considered a lease with a definite period under Article 1687 of the Civil Code. This provision states that if the rent is paid monthly and no period for the lease has been set, it is understood to be from month to month. The Court reiterated its previous rulings that such a lease, upon its expiration and after demand to vacate is made by the lessor, allows for the ejectment of the lessee. The petitioner's contention that the lease was for an indefinite period was thus rejected. On the issue of whether the owner-lessor can eject the tenant by reason of expiration of the period of lease under Article 1687 of the Civil Code, independently of the grounds for judicial ejectment under Batas Pambansa Blg. 877: The Court clarified that Section 6 of Batas Pambansa Blg. 877 (the Rent Control Law) suspends Article 1673 of the Civil Code, not Article 1687. While the suspension of Article 1673 means a lessor cannot eject a tenant solely based on the expiration of the lease period as provided in that article, Article 1687 itself remains operative for the purpose of determining the period of a lease agreement. Therefore, the expiration of a month-to-month lease, as determined by Article 1687, remains a valid ground for ejectment, and this is further supported by Section 5(f) of Batas Pambansa Blg. 877, which explicitly lists the expiration of the lease contract as a ground for ejectment, removing the prior distinction between written and oral contracts. On the issue of whether the private respondent, as the new owner, is bound to respect the existing lease contract: The Court ruled that with the expiration of the lease contract, there was no longer a lease to bind the new owner. The principle of respecting existing contracts applies when the contract is still valid and subsisting. Since the month-to-month lease had expired on December 30, 1990, the new owner was not obligated to continue the lease with the petitioner. On the issue of whether the Court of Appeals erred in not holding that it could fix the term for the lease only if prayed for in the complaint: The Court clarified that the appellate court, as well as the lower courts, did not fix the period of the lease. Instead, it was Article 1687 of the Civil Code that determined the lease to be on a month-to-month basis because the rent was paid monthly. The Court also noted that the petitioner's occupancy had been extended for five years during the pendency of the case, which was deemed sufficient time to find alternative housing.
Main Doctrine
A lease on a month-to-month basis is considered a lease with a definite period under Article 1687 of the Civil Code, and upon its expiration and demand to vacate, an ejectment suit may be ordered. Section 6 of Batas Pambansa Blg. 877 suspends Article 1673 of the Civil Code but not Article 1687.