ARTURO P. SANTOS AND ADELINA Y. SANTOS, PETITIONERS, VS. THE COURT OF APPEALS AND AURORA GUTIERREZ, RESPONDENTS.

Appeal by certiorari from the decision of the then Court of
Appeals in CA-G.R. No. SP-13056, affirming the one rendered by the then
Court of First Instance of Manila, Branch XVI, in Civil Case No. 138472.

Records show that herein private respondent Aurora Gutierrez instituted
an unlawful detainer case in the then City Court of Manila against
herein petitioners Arturo P. Santos and Adelina Y. Santos on grounds
that she needs the premises for her personal use and the necessity of
repairs thereon, and that the petitioners were delinquent in the payment
of rentals.

In their Answer with Counterclaim, petitioners, among others, admitted
that they are “the legitimate tenants and/or lessees of the subject
apartment with the present rental rate of P250.00 a month on a
month-to-­month contract of lease.” (p. 62, Rollo)

After trial, the City Court rendered judgment –

“Premises considered, this Court hereby renders judgment for the
plaintiff and against the defendants and hereby orders the defendants
and all persons claiming under them to vacate the premises in question
known as No. 1836 Cavite St., Sta. Cruz, Manila and surrender its
possession to the plaintiff.

“The defendants are further ordered to pay the plaintiff P2,500.00
as rentals for the period December 1978 through September 1979, and,
further to pay the plaintiff rentals at the rate of P250.00 per month
from October 1979 until such time as possession of the premises in
question shall have been restored to the plaintiff minus whatever
amounts may have been already received by the plaintiff from deposits
made in Court. The defendants are further ordered to pay the plaintiff
P1,000.00 as and for attorney’s fees plus costs of suit. All claims by
the defendants against the plaintiff are dismissed, for lack of merit.”
(p. 74, Rollo)

Petitioners appealed the foregoing judgment to the then Court of First
Instance which found the same “in accordance with both the evidence and
the law” and affirmed the decision. Thereafter, petitioners went to the
Court of Appeals on a petition for review and the latter, on January
29, 1982, rendered judgment as follows:

“PREMISES CONSIDERED, there being substantial evidence to
support the decision under review, the instant petition is hereby
DENIED DUE COURSE and is resultantly hereby DISMISSED.” (p. 22, Rollo)

Hence, this petition for review on certiorari, the Santoses submitting
that (1) they were never delinquent in the payment of rentals only the
collector failed to get the money and since they whereabouts of private
respondent was unknown, they were forced to deposit them to the bank;
(2) the mere sending of a notice to vacate by registered mail which the
postal clerk refused to deliver to them for the reason of wrong name
cannot be considered sufficient compliance with the jurisdictional
requirement of notice; (3) they have been leasing the apartment for 28
years and are therefore entitled to preferential right to purchase their
unit under Presidential Decree No. 1517; (4) there is no real need of
the premises by private respondent; (5) it was an error to order their
ejectment without complying with the mandatory requirements of Batas
Pambansa Blg. 25 and the ruling in Rantael vs. Llave, 97 SCRA 453; (6)
respondent court erred in stating that a contract of lease of
residential apartment involving a rental of P250.00 a month may be
terminated at the end of the month without default on the part of the
lessee; (7) there was improper change of theory on appeal on the part of
private respondent; and, (8) there was error in affirming the decision
of the lower court.

We find no merit in the petition.

1. Petitioners, in their “Answer with Counter claim” (Annex “B”, Petition, page 62, Rollo)
admit that they are “the legitimate tenants and/or lessees of the
subject apartment with the present rental rate of P250.00 a month on a month-to-month contract of lease.” (Italics supplied).

The aforequoted provision of the agreement on occupancy of the apartment
cannot but mean as providing for a definite period of the lease. The
parties expressly agreed that upon proper notice, one may terminate the
agreement. As stated in Rantael vs. Court of Appeals, 97 SCRA 453, 459 –

“x x x The contractual relations between petitioner Rantael and
respondent have ceased after the expiration of the first thirty days
reckoned from August 1, 1974 but continued for the next thirty-day
period and expired after the last day thereof, repeating the same cycle
for the succeeding thirty-day periods, until the said respondent have
exercised her express prerogative under the agreement to terminate the
same.”

2. Paragraph 1 of Article 1673 of the Civil Code is an exception to
Section 4 of Presidential Decree No. 20. Said Section 1 of Article
1673 provides –

“Art. 1673. The lessor may judicially eject the lessee for any of the following causes:

(1) When the period agreed upon, or that which is fixed for the duration of lease under articles 1682 and 1687, has expired;”

Thus, judicial ejectment lies when the lease is for a definite period or
when the fixed or definite period agreed upon has expired. The lease
in the case at bar having a definite period, it follows that private
respondent’s right to judicially eject petitioners from the premises may
be enforced. As aptly stated by respondent Court of Appeals, “[e]ven
on the strength alone of the Rantael ruling, the petitioners can be
lawfully ejected, regardless of the motive or intent of the
lessor-private respondent. We thus see no point in discussing the other
issues raised except to state that P.D. No. 1517, in referring to the
pre­emptive or redemptive right of a leassee speaks only of urban land
under lease on which a tenant has built his home and in which he has
resided for ten years or more. If both land and the building belong to
the lessor, the right referred to hereinabove does not apply.” (p. 22, Rollo)

ACCORDINGLY, judgment is hereby rendered DISMISSING the instant petition
for review and AFFIRMING the decision of respondent Court of Appeals.
With costs.

SO ORDERED.

Plana, Escolin and Gutierrez, Jr., JJ., concur.

Melencio-Herrera, J., (Acting Chairman), see dissenting and concurring opinion.

De la Fuente, J., no part.

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DISSENTING AND CONCURRING OPINION

MELENCIO-HERRERA, J.:

Private respondent Aurora Gutierrez, an apartment owner, instituted an
Unlawful Detainer suit against petitioners-lessees, the Santos spouses,
on the grounds of personal use, need for repairs of the leased premises,
and delinquency in payment of rentals by petitioners.

In paragraph 2 of their Answer with Counterclaim, peti­tioners stated
that they are “the legitimate tenants and/or lessees of the subject
apartment with the present rental rate of P250.00 a month on a month-to-month contract of lease.” In paragraph 11 of their Special and Affirmative Defenses, however, they also averred that they principally rely on their verbal month-to-month contract.

The judgment of the City Court ordering petitioners to vacate was
affirmed by the Court of First Instance as well as by respondent
Appellate Court, the latter on a petition for review.

The present appeal by Certiorari seeks a reversal of the ejectment separately adjudged by those three Courts.

The majority opinion sustains the judgment of respondent Appellate Court
on the principal ground that the lease is for a definite period and,
therefore, outside the pale of Presidential Decree No. 20, and relying
on our ruling in Rantael vs. Court of Appeals, et al., 97 SCRA 453
(1980).

I believe, however, that, upon the facts, the lease involved herein is
not for a definite period, the period being determined, not by any
agreement of the parties, but pursuant to Article 1687 of the Civil
Code, which provides:

“If the period for the lease has not been fixed, it is understood
to be x x x from month to month, if it (the rent agreed upon) is
monthly.”

Consequently, the subject lease falls squarely within the purview of
Article 1673 of the Civil Code, the effects of which were suspended by
Section 6 of Batas Pambansa Blg. 25 (formerly Section 4 of P.D. 20),
reading thus:

“SEC. 6. Application of the Civil Code and Rules of Court of the
Philippines. – Except when the lease is for a definite period, the
provisions of paragraph (1) of Article 1673 of the Civil Code of the
Philippines inso­far as they refer to residential units covered by this
Act shall be suspended during the effectivity of this Act, but other
provisions of the Civil Code and the Rules of Court on lease contracts,
insofar as they are not in conflict with the provisions of this Act,
shall apply.”

The related provision, paragraph (1) of Article 1673 of the Civil Code, provides:

“ART. 1673. The lessor may judicially eject the lessee for any of the following causes:

(1) When the period agreed upon, or that which is fixed for the
duration of leases under articles 1682 and 1687, has expired;”

Construing the foregoing provisions together, it results that even if a
month-to-month lease under Article 1687 of the Civil Code expires, it
cannot be a ground for ejectment in view of the suspension of Article
1673(1) by Batas Pambansa Blg. 25. As we have succinctly held in the
following cases:

“Construing Sec. 4 of Presidential Decree No. 20 in relation to Art.
1673 par. 1 and Art. 1687 of the Civil Code, it is clear and explicit
that Presidential Decree No. 20 suspends paragraph (1) of Article 1673.
Hence, the petitioner cannot be ejected at the expiration of of the
period provided under Article 1687 of the Civil Code.” (Salaria vs.
Buenviaje, 81 SCRA 722, 727 (1978).

x                      x                      x

“x x x The only ground, therefore, apparently available to
plaintiffs to justify their action is the fact that the duration of the
lease as fixed by Article 1687 has already expired, or expires each
month and may be terminated at the end of said month. But this is
excepted as ground for ejectment by Sec. 4 of Republic Act No. 6359.
Under said section, the provision of the first paragraph of Article 1673
is suspended when the period of the lease has not been agreed upon but
has been only fixed in accordance with Article 1687 and said period has
expired. x x x It should be noted that in the opposition to such motion,
Presidential Decree No. 20 which suspends court actions for ejectment
for leases covered by the same was relied upon by private respondents.”
(Gutierrez vs. Cantada 90 SCRA 1, pp. 4-5 (1979).

The Rantael doctrine is not invocable because of the striking
difference that the lease in that case was embodied in a written
“Agreement on Occupancy of Apartment” by which terms, “the lessee agreed
to use and live in the apartment. On a month-to-month basis, beginning
today”. Hence, our ruling therein that a lease contract on a
month-to-month basis provides a definite period and may be terminated at
the end of any month. That was a conventional lease as contrasted to
the legal lease herein. In the case at bar, as found by the Court of
First Instance, there was no formal agreement between private respondent
and petitioners, “it appearing that the former merely acquiesced to the
latter’s continued occupation of the property in question” after
private respondent had purchased the premises from the pre­vious owner.
The subject lease, therefore, cannot be said to be a lease for a
definite period, determined as that period is by Article 1687 of the
Civil Code, for, otherwise, there would hardly be any occasion for the
application of Section 6 of Batas Pambansa Blg. 25. As a matter of fact,
the Rantael case specifically states that judicial ejectment would not
lie even though the periods fixed under Article 1687 may have expired.

“In accordance with the foregoing, (par. [1] of Arti­cle 1673)
section 4 of Presidential Decree No. 20 should be understood to mean
that, as a general rule, the lessor may not judicially eject the lessee
upon the expiration of the period determined in accordance with the
provisions of Articles 1682 and 1687 of the Civil Code. x x x x x x
(Article 1687 provides that ‘[i]f the period for the lease has not been
fixed, it is understood to be from year to year, if the rent agreed upon
is annual; from month to month, if it is monthly; from week to week, if
the rent is weekly; and from day to day, if the rent is to be paid,
daily,’ and further provides that the courts may fix a longer term for
the lease after the lessee has occupied the premises for certain periods
of time). Thus, judicial ejectment would not lie even though the
periods fixed under the said Articles may have expired.” (Rantael vs.
Hon. CA, et al., 97 SCRA 453, 460 (1980).

Be that as it may, I concur in the ejectment of peti­tioners for, as
held in Baens vs. Court of Appeals, et als., (G.R. No. 57091, November
23, 1983), even if the month to month arrangement is on a verbal basis,
the lease is considered terminated at the end of the month, if statutory
grounds to eject under Section 5 of Batas Pambansa Blg. 25 exist. In
this case two such grounds are present, parti­cularly, (1) arrears in
the payment of rentals (Sec. 5[b], B.P. Blg. 25) as found by the City
Court, which held peti­tioners “culpably delinquent”; and (2) the need
of the lessor to make necessary repairs, there being already an order of
condemnation by appropriate administrative autho­rities (Sec. 5[e] B.P.
Blg. 25), which petitioners admit having received.