Sunbanun v. Go
REITERATIONFacts
The Antecedents: Petitioner Doris U. Sunbanun leased the ground floor of her residential house to respondent Aurora B. Go for one year, from July 7, 1995, to July 7, 1996. Respondent paid a deposit and accepted lodgers, mostly relatives, generating P15,000 monthly income. In March 1996, petitioner informed respondent's lodgers that they could only stay until April 15, 1996, and subsequently padlocked the vacated rooms, effectively terminating the lease three months before its expiry. Procedural History: Respondent filed an action for damages against petitioner, claiming lost income and travel expenses. Petitioner argued that respondent violated the lease by subleasing and that the lease was not renewed. The trial court, after a motion for judgment on the pleadings by petitioner, ruled in favor of respondent, awarding actual damages of P45,000 and attorney's fees of P8,000, finding that accepting lodgers was permitted by the lease and that petitioner did not controvert the ejection of lodgers. The Petition: Both parties appealed to the Court of Appeals, which modified the trial court's decision by awarding moral and exemplary damages, and costs of suit in addition to actual damages and attorney's fees. Petitioner now seeks review of the Court of Appeals' decision.
Issue(s)
Whether the Court of Appeals erred in affirming the award of actual damages. Whether the Court of Appeals erred in awarding moral and exemplary damages and costs of suit. Whether the Court of Appeals erred in affirming the award of attorney's fees.
Ruling
The petition is denied. The Court affirms the decision of the Court of Appeals, upholding the awards of actual, moral, and exemplary damages, as well as attorney's fees.
Ratio Decidendi
On the award of actual damages: The Court affirmed the award of actual damages amounting to P45,000.00. The petitioner's act of ejecting respondent's lodgers three months before the lease contract expired was found to be a breach of contract. The lease contract explicitly allowed the lessee to "use the premises as a dwelling or as lodging house." Petitioner's contention that subleasing violated the contract was thus untenable. The early termination of the lease by the petitioner directly resulted in the respondent losing income from her lodgers, making the award of actual damages for lost income proper. On the award of moral and exemplary damages: The Court sustained the award of moral damages, citing Articles 2219 and 2220 in relation to Article 21 of the Civil Code. Petitioner's act of ejecting the lodgers without valid reason and prior to the lease expiration was deemed to be in bad faith, especially since the respondent was working abroad and was not informed of the plan. This willful injury and breach of contract attended by bad faith justified the award of moral damages. Exemplary damages were also affirmed under Article 2232 of the Civil Code, as petitioner's oppressive act warranted such an award. On the award of attorney's fees: The Court affirmed the award of attorney's fees. Article 2208 of the Civil Code allows for the recovery of attorney's fees in cases where exemplary damages are awarded, or when the defendant acted in bad faith, as was found in this case. The award of attorney's fees was thus a logical consequence of the finding of bad faith and the propriety of awarding exemplary damages.
Main Doctrine
A lessor who forcibly ejects a lessee's lodgers prior to the expiration of the lease contract without valid cause commits a breach of contract, entitling the lessee to actual, moral, and exemplary damages, especially when such act is attended by bad faith.