MANUEL MALLARI and MILLIE MALLARI v.

REBECCA ALSOL
G.R. No. 150866, March 6, 2006(Carpio, J.)

FACTS:

Stalls No. 7 and 8 of the Supermarket Section of the Cabanatuan City Public Market were
awarded to and occupied by Abelardo Mallari, father of Manuel Mallari and Rebecca Alsol, who
occupied Stalls 7 and respectively. Before Abelardo’s death, he gave the respective stalls to
Manuel and Rebecca.

Sometime in 1988, respondent’s daughter became sick and the Alsol family had to stay in
Manila for two months for the medical treatment. Upon their return, they found out that
petitioners were already occupying Stall No. 8. The partition between Stalls No. 7 and 8 had
been removed and respondent’s merchandise and things were already gone. The Mallaris
refused Alsol’s demand to vacate the stall.

With the help of the City Market Committee, Stall No. 7 was granted Mallari and Stall
No. 8 to Alsol. Alsol and the city government executed a lease contract with the right to occupy
Stall No. 8 for a monthly rental of P316 subject to increase or decrease in accordance with the
city rules and ordinances.However, the Mallaris still refused to vacate and instead, they filed an
action for annulment of such contract before the RTC.

ISSUE: Whether or not the lease contract executed is valid.

HELD:

YES. Petitioners insist that the Lease Contract is not valid because the City Treasurer
should have signed the Lease Contract and not Mayor Perez,the City Mayor. The Court agrees
with petitioners that RA 7160 is not the applicable law. It should have applied Batas
PambansaBlg. 337 or the old Local Government Code. Still, even under BP 337, city mayors have
the authority to sign contracts on behalf of city governments.

Petitioners also allege that the Lease Contract is not valid because Mayor Perez did not
appear before the notary public who notarized the document. Such argument was not sustained
by the Court.

Notarization converts a private document into a public document. However, the non-
appearance of the parties before the notary public who notarized the document does not
necessarily nullify nor render the parties’ transaction void ab initio.Thus:

x xx Article 1358 of the New Civil Code on the necessity of a public document is only for
convenience, not for validity or enforceability. Failure to follow the proper form does not
invalidate a contract. Where a contract is not in the form prescribed by law, the parties
can merely compel each other to observe that form, once the contract has been perfected.
This is consistent with the basic principle that contracts are obligatory in whatever form
they may have been entered into, provided all essential requisites are present.

Hence, the Lease Contract is valid despite Mayor Perez’s failure to appear before the notary
public.