TOMASA C. VIUDA DE PAMINTUAN, PLAINTIFF AND APPELLANT, VS. JUAN TIGLAO, DEFENDANT AND APPELLANT.

This action was instituted in the court of the justice of the peace
of Mabalacat, Pampanga, by Tomasa C. Vda. de Pamintuan, as guardian of
her five minor children, bearing the surname of Pamintuan y Centeno,
for the purpose of recovering from Juan Tiglao the possession of two
parcels of land described in the complaint, as well as a quantity of
palay and sugar, as rent, together with damages and an attorney’s fee,
and costs. In said court the cause was decided favorably to the
plaintiff, whereupon the defendant appealed to the Court of First
Instance. In the latter court the defendant challenged the jurisdiction
of the court and set up various counterclaims not necessary to be here
specified.

Upon the trial of the cause in the Court of First Instance judgment
was again rendered in favor of the plaintiff for the possession of the
land in question and requiring the defendant to pay to the plaintiff,
as rent for the agricultural year 1925-1926, three hundred cavans of
palay (Pinilmgbeltu), or in default thereof, its equivalent in money at
the rate of P3.75 per cavan, as well as four hundred piculs of sugar;
and as rent for the agricultural year 1926-1927, another three hundred
cavans of palay, or in default thereof, its equivalent value in money
at the same rate per cavan, with interest on all of said sums from
April 10, 1926. From this judgment both the plaintiff and the defendant
appealed: the plaintiff appealing with respect to so much of the
judgment as failed to award the stipulated attorney’s fee of P1,000 and
stipulated interest at the rate of 15 per cent per annum upon the
unpaid rents; the defendant appealing from the court’s refusal to
dismiss the cause for lack of jurisdiction, as well as from the failure
of the court to allow to the defendant his own attorney’s fee.

It appears that on March 18, 1925, one Jose V. Ramirez, as
attorney-in-fact of Florentino Pamintuan, entered into a written
contract with the defendant herein, Juan Tiglao, whereby the former
leased to the latter the two parcels of land described in the
plaintiff’s complaint, located in the barrio of Dolores, municipality
of Mabalacat, Province of Pampanga. The term of this lease was fixed at
two agricultural years, beginning with the month of April, 1925, and
continuing through March, 1927.

In the fourth paragraph of this contract the annual rent due upon
the lease was fixed at three hundred cavans of palay and four hundred
piculs of sugar, of defined quality, and deliverable on or before the
last day of March, marking the end of the two respective years covered
by the lease. The rent for the first year not having been paid on or
before March 31, 1926, nor thereafter, this action was instituted, on
September 10, 1926, after proper demand made, for the purposes
indicated in the first paragraph of this opinion.

Logically speaking, the first question that presents itself upon
this record is whether the court of a justice of the peace has
jurisdiction to entertain an action of detainer, at the instance of the
landlord, upon failure of the tenant to pay rent at the time and in the
manner stipulated; and consequently whether this action, which was
instituted prior to the termination of the full period fixed by the
lease, can be considered premature. Upon this point, it may be
recalled, as rudimentary in the law governing leases of rural and Urban
property, that it is the duty of the lessee to pay the price of the
lease in the manner agreed upon (art. 1555, Civ. Code). Furthermore,
the failure on the part of the lessee to comply with this obligation
supplies a ground for the rescission of the contract and the recovery
of damages by the lessor (art. 1556, Civ. Code). Again, in section 80
of the Code of Civil Procedure, it is in effect, among other things,
declared that any landlord against whom the possession of any land is
unlawfully, withheld after the determination of the right to hold
possession shall, at any time within one year after the commencement of
such unlawful withholding of possession, be entitled, as against the
person so depriving him of possession, to restitution of the land,
together with damages and costs. From these provisions it is clear
that, upon non-payment of rent by the lessee, the lessor may elect to
treat the contract as rescinded and thereby determine the right of the
lessee to continue in possession; and this right to recover possession
may be enforced in an action of unlawful detainer. It is not necessary,
in such situation, that an independent action for the rescission of the
lease should first be instituted, in the Court of First Instance, for
the purpose of putting an end to the right of the tenant to remain in
possession under the lease. Indeed, the proviso to the
section of the Code of Civil Procedure last above cited, gives express
recognition to the right of the landlord to recover possession in an
ordinary action of detainer, for non-payment of rent by the lessee, the
condition being that non-payment of the rent must have continued for
the period of at least three days after demand duly made.

It appears from the record that after this action was begun, and
before the case was decided? the defendant voluntarily surrendered
possession of the land to the plaintiff. Upon this it is contended by
the attorney for the defendant that the court of the justice of the
peace—and consequently the Court of First Instance—lost jurisdiction to
entertain the action. This contention is of course untenable. The
jurisdiction of the court having once attached, that jurisdiction
continues until the complete remedy is granted. The defendant-appellant
further contends that, inasmuch as he set up a counterclaim for damages
in the amount of P6,000, the jurisdiction of the court of the justice
of the peace over the main action w,as destroyed, But this proposition
also is untenable.

What has been said disposes of the main points raised in the appeal
of the defendant. With respect to the plaintiff’s appeal, we note,
first, a provision in the contract of lease to the effect that if the
stipulated rent should not be paid at the times stated, the lessee must
indemnify the lessor in an additional amount equivalent to 15 per
centum annually, or 1.25 per cent for each month of delay, to be
calculated upon the highest quotation registered in the market, for the
commodity which should have been” paid, within the sixty days following
the due date of such rent. The trial court refused to give effect to
this stipulation on the ground that, in effect, it was a stipulation
for the payment of usurious interest. In this connection it will be
recalled that at the time the contract in question was made, the
highest rate that could be legally collected upon any unsecured loan or
forbearance of money, goods, or credits, was 14 per centum per annum.
In view of this provision, we are of the opinion that the trial court
committed no error in refusing to allow the interest thus stipulated
for. In dealing with situations of this kind it is the duty of the
court to look through the form and into the substance of the
transaction, and we are of the opinion that this stipulation really
contemplated interest, as interest, and that the stipulation did not
contemplate what may be called liquidated damages, as contended by the
plaintiff-appellant.

The second point involved in the plaintiff’s appeal has reference to
the refusal of the trial court to allow an attorney’s fee. In paragraph
11 of the contract, it is stipulated that in case of litigation for
non-compliance with the lease, the lessee shall pay to the lessor the
sum of M,000 for his attorney’s fee and other expenses. The justice of
the peace, before whom the case was brought, refused to take cognizance
of this item on the ground that the sum exceeded the amount over which
he could take jurisdiction. Upon appeal, the Court of First Instance
held that as it was only exercising its appellate jurisdiction, it
could not take cognizance of matters beyond the jurisdiction of the
justice of the peace court.

In our opinion, the views of the two lower courts are correct. A
justice of the peace court is of limited jurisdiction, and the limits
are fully and clearly denned in the statutes. This is an action for
forcible entry and detainer and, as such, can only involve the
“restitution of the land, building, and premises possession of which is
unlawfully withheld, together with damages and costs” (See
sec. 80, Code of Civil Procedure). Damages do not include attorney’s
fees; whatever doubt there may be on that point should be dispelled by
section 84 of the same Code, which reads as follows:

“If, upon trial, the court shall find that the complaint is not
true, it shall enter judgment against the plaintiff for costs. If it
finds the complaint to be true, it shall render judgment against the
defendant in favor of the plaintiff for restitution of the premises,
and costs of suit, and for all arrears of rent, or a reasonable compensation for the use and occupation of the premises.” (Italics supplied,)

The costs referred to are fixed by section 491 of the Code and do not include attorney’s fees.

In conclusion we “note that the defendant supposes that he is
entitled to recover his own attorney’s fee under section 7 of the Usury
Law (Act No. 2655), in view of the usurious character of the
stipulation for the payment of 15 per cent interest to the lessor upon
overdue rents. This suggestion is untenable, since the right to the
attorney’s fee under the section referred to attaches only when
usurious interest has been in fact paid. The circumstance that usurious
interest is stipulated for does not entitle the borrower to an
attorney’s ‘fee in an action declaring1 the stipulation usurious.

The judgment appealed from is in accordance with the law and the facts and is affirmed without costs. So ordered.

Johnson, Malcolm, Johns, Romualdez, and Villa-Real, JJ., concur.

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DISSENTING:

STREET, J.:

Though concurring in the main, I am unable to subscribe to so much
of this decision as fails to concede to the plaintiff a reasonable
allowance, within the limits of one thousand pesos, for attorney’s fees
and other expenses. The lease contains a special stipulation to the
effect that in case litigation shall result from non-compliance with
the contract upon part of the lessee, the latter will pay the sum of
one thousand pesos for attorney’s fees and other expenses. Stipulations
of this kind have heretofore been uniformly respected by this court,
though it does not hold itself bound to allow the whole amount
stipulated for. The justice of the peace and the Judge of First
Instance, in denying this fee, proceeded on the theory that the one
thousand pesos mentioned in the stipulation was in excess of the
maximum amount over which the court of a justice of the peace has
jurisdiction, and for this reason they disallowed any fee. The
reasoning contained in the opinion written by Justice Ostrand for this
court denies the right of the litigant to recover any attorney’s fee at
all, regardless of the amount stipulated for. In this view no recovery
could ever be had of an attorney’s fee, though expressly stipulated
for, in an action of unlawful detainer. I consider both points of view
to be incorrect.

It is to be admitted of course that when an attorney’s fee is not
expressly stipulated for, it cannot be allowed as costs, expenses,
disbursements, or as damages, but where there is a stipulation to pay a
certain amount as attorney’s fee in case litigation results from breach
of contract, a reasonable fee can be allowed, not in excess of the
amount agreed upon; and of course it must be allowed in the character
of damages. In the innumerable instances where stipulations
of this kind have been enforced, the liability arises from breach of
the contract, and there is no other conception than damages under which
it can be imagined that the fee is allowable.

The jurisdiction of the court of justice of the peace in civil
actions is defined in section 68 of Act No. 136, where it is in
substance declared among other things that the court of the justice of
the peace shall have original jurisdiction in forcible entry and
detainer proceedings, whether the subject of litigation is or is not
capable of pecuniary estimation, tinder this general provision the
court of a justice of the peace, having jurisdiction to determine the
right of possession, may award damages in any amount in connection with
the determination of the right of possession. And this power is not
restricted by anything contained in section 84 of the Code of Civil
Procedure. The evident purpose of that provision is to describe the
ordinary incidents of the liability of the defendant with respect to
the unlawful detention. No attempt is there made to give any exhaustive
statement of all the relief procurable in such an action; while section
80 expressly provides for the award of damages.

In the case before us the rights of the litigant parties were
defined in the contract of lease, and the right of the lessor to
recover the possession of the premises had its origin in a breach of
this contract by the lessee. Moreover, the right of the plaintiff to
recover a reasonable attorney’s fee under the stipulation mentioned
arose from the institution of litigation as a result of the same breach
of contract on the part of the defendant; and inasmuch as the right to
£he fee is an inseparable incident from the plaintiff’s right to
possession, he is entitled to recover the fee as a part of the damage
resulting from the breach.

It is a recognized rule that, generally speaking, liability under a
contract is not divisible and, if the plaintiff cannot recover the fee
in the action which he is forced to bring to recover possession, he
cannot recover it in any court. Necessarily the result of the present
decision is to make an outlaw of a stipulation for attorney’s fee in a
contract of lease, in all cases where the plaintiff finds it necessary
to have recourse to a court of the justice of the peace to recover
possession of the leased premises. I cannot see either the justice or
the propriety of putting such a stipulation under the ban.