G.R. No.147812. April 6, 2005 Office, copy furnished [Tirona].
Office, copy furnished [Tirona]. A copy of the said reply of [Ocampo] marked as Annex "C" of
LEONARDO R. OCAMPO, Petitioners,
vs.
LEONORA TIRONA, Respondents.
DECISION
CARPIO, J.:
The Case
This is a petition for review1 to annul the Decision2 dated 29 November 2000 of the Court of
Appeals ("appellate court") in CA-G.R. SP No. 41686, and its Resolution dated 16 April 2001
denying the motion for reconsideration. The appellate court set aside the Decision 3 dated 27
June 1996 of Branch 110 of the Regional Trial Court of Pasay City ("RTC") in Civil Case No.
96-0209. The RTC affirmed the Decision4 dated 29 December 1995 of Branch 47 of the
Metropolitan Trial Court of Pasay City ("MTC") in Civil Case No. 754-95 ordering respondent
Leonora Tirona ("Tirona") to vacate and surrender possession of the property under litigation
to petitioner Leonardo R. Ocampo ("Ocampo"). The MTC also ordered Tirona to pay Ocampo
rentals in arrears, attorney’s fees, and costs of suit.
Antecedent Facts
Ocampo alleged that he is the owner of a parcel of land ("subject land") described in Transfer
Certificate of Title ("TCT") No. 134359, with an approximate area of 500 square meters,
located at Alvarez Street, Pasay City. Ocampo bought the subject land from Rosauro Breton,
heir of the subject land’s registered owner Alipio Breton Cruz. Possession and administration
of the subject land are claimed to be already in Ocampo’s management even though the TCT
is not yet in his name. Tirona, on the other hand, is a lessee occupying a portion of the
subject land.5 The MTC established the following facts:
According to [Ocampo], upon acquisition of ownership of the subject premises, a formal
written notice was given to [Tirona] which was received by the latter on 9 March 1995, copy of
the said formal written agreement marked as Annex "A" and likewise copy of the registry
return receipt showing that [Tirona] received Annex "A" was marked as Annex "A-1". In
recognition of [Ocampo’s] right of ownership over the subject premises, [Tirona] paid some
monthly rentals due, however, on July 5, 1995, [Ocampo] received a letter from Callejo Law
Office of Room 513 Borja Bldg., 645 Sta. Cruz, Manila stating among others, that, in view of
the fact that the subject premises was declared under area for priority development, [Tirona]
is invoking her right of first refusal and in connection thereto [Tirona] will temporarily stop
paying her monthly rentals until and unless the National Housing Authority have processed
the pertinent papers as regards the amount due to [Ocampo] by reason of the implementation
of the above law, a copy of the said letter marked as Annex "B" of the Complaint. In reply to
Annex "B", [Ocampo] sent a letter dated 17 July 1995 addressed to the said Callejo Law
the Complaint, a copy of the Registry Return Receipt showing that [Tirona] received said
Annex "C" on 20 July 1995 marked as Annex "C-1" of the Complaint, while as the original
copy which was sent to Callejo Law Office was also received by said office. On 7 August
1995, [Ocampo] wrote a letter to [Tirona] demanding upon [Tirona] to pay the rentals in
arrears for the months of April, May, June, July and August at the rate of ₱1,200 a month and
to vacate the premises, copy of the said letter dated 7 August 1995 marked as Annex "D" of
the Complaint and the signature at the bottom portion of Annex "D" clearly shows that the
same was received by [Tirona] on 8 August 1995. Despite receipt of said letter, [Tirona] failed
and refused and still fails and refuses to heed [Ocampo’s] demands.6
On 11 September 1995, Ocampo filed a complaint docketed as Civil Case No. 754-95 for
unlawful detainer and damages against Tirona before the MTC.
Tirona filed her answer on 27 September 1995. Tirona asserted that Doña Lourdes
Rodriguez Yaneza actually owns the subject land. The allegations in the answer state thus:
1. That the Assignor [one Edison A. Hindap, Sr.] is the General Overseer and Attorney-in-
Fact of DOÑA LOURDES RODRIGUEZ YANEZA, Heir/Owner of TITULO DE PROPRIEDAD
DE TERENOS of 1891, Royal Degree 01-4 Protocol, the real owner of a parcel of land
allegedly claimed by [Ocampo].
2. That the Title of [Ocampo] was overlapped [sic] the Original Land Title of the Assignor.
3. That [Tirona], hereby recognized by the Assignor as co-owner by possession and hereby
cede, transfer and assign the said parcel of land in [Tirona’s] favor.
4. That [Tirona] hereby denied [sic] and discontinued [sic] all the obligations imposed by
[Ocampo], for the simple reason, the property in question is not owned by [Ocampo], but
rather owned by the Assignor, as proof of evidence herein Assignor issued a Certification for
Occupancy and Assignment in favor of [Tirona] herein attached with [sic], and the other
evidence shall be presented upon the proper hearing on the merits of this case.7
Ocampo filed a motion to strike out the answer filed and a motion for judgment on 10 October
1995. Ocampo claimed that the answer was not verified; therefore, it was as if no answer was
filed.
On 12 October 1995, Tirona filed a motion with leave to amend defendant’s answer. 8 She
alleged that she filed her answer without the assistance of a lawyer due to fear that she might
be unable to file the required pleading on time. In her amended answer, Tirona maintained
that Ocampo is not the owner of the subject land. She stated that the certificate of title to the
subject land is not even registered under Ocampo’s name. Tirona also alleged that she has a
right of first refusal in case of sale of the land, pursuant to Presidential Decree ("PD") Nos.
1517,9 189310 and 1968.11 The area where the subject land is located was certified as an area
under priority development.12 Tirona asked for attorney’s fees and moral and exemplary
damages.
In the spirit of substantial justice, the MTC granted Tirona’s motion to amend her answer on
20 October 1995. On 15 November 1995, the MTC directed Ocampo and Tirona to submit
their respective position papers and other evidence after the termination of the pre-trial
conference.
The issue considered by the MTC for resolution was whether Ocampo may eject Tirona
because of non-payment of rent and because of the termination of Tirona’s right to possess
and occupy the subject land.
The MTC’s Ruling
The MTC ruled that Tirona does not have any reason to suspend payment of rents until after
PD No. 1517, in relation to PD Nos. 1893 and 1968, is implemented in her favor. Tirona’s
non-payment of rents rendered her occupation of the subject land illegal. As owner of the
subject land, Ocampo is entitled to its use and enjoyment, as well as to recover its
possession from any person unlawfully withholding it.
The dispositive part of the MTC’s decision reads:
WHEREFORE, judgment is hereby rendered in favor of [Ocampo] and against [Tirona]:
1. Ordering [Tirona] and all other persons claiming possession under her to vacate and
surrender possession to [Ocampo] the premises known as, parcel of land located at 2132
Alvarez St., Pasay City, covered by Transfer Certificate of Title No. 134359 of the Register of
Deeds of Pasay City;
2. Ordering [Tirona] to pay the rentals in arrears covering the period from April 1995 until
such time [Tirona] shall have finally vacated the subject premises at the rate of ₱1,200 a
month, with interest at a legal rate;
3. Ordering [Tirona] to pay the sum of ₱5,000 for and as attorney’s fees; and
4. Ordering [Tirona] to pay the cost of the suit.
SO ORDERED.13
Ocampo filed a motion for execution pending appeal on 24 January 1996, while Tirona filed a
notice of appeal on 25 January 1996. The MTC directed its clerk of court to transmit the
records of the case, as well as the motion for execution pending appeal, through an order
issued on 29 January 1996. The RTC issued an order on 26 February 1996 ordering both
parties to file their respective memoranda.
On 4 March 1996, Maria Lourdes Breton-Mendiola, who claimed to be the owner of the
subject land, filed a motion with leave to file intervention before the RTC.
The RTC’s Ruling
In an order dated 11 March 1996, the RTC issued a writ of execution pending appeal for the
enforcement of the MTC’s decision. The RTC stated that although Tirona perfected her
appeal on time, the record showed that she failed to pay the required supersedeas bond as
well as deposit the current rentals as mandated by Section 8, Rule 70 of the 1964 Rules of
Court. In a separate order issued on the same date, the RTC denied Maria Lourdes Breton-
Mendiola’s motion with leave to file intervention. The RTC stated that granting the motion to
intervene would violate the 1964 Rules of Court and jurisprudence.
Ocampo filed his memorandum on 21 March 1996.14 He emphasized that Tirona’s assertion
of a "preferential right of first refusal" is a recognition of the sale by Rosauro Breton of the
subject land to him. Moreover, Tirona is not qualified to claim this preferential right because
she is no longer a legitimate tenant. The payment of Tirona’s monthly rent was already in
arrears at the time Ocampo filed the complaint against Tirona.
On 25 March 1996, Tirona filed a manifestation which stated that she paid both the
supersedeas bond and rent on the subject land. The RTC considered Tirona’s manifestation
as a motion for reconsideration of its previous order issuing a writ of execution pending
appeal. In its order dated 15 April 1996, the RTC recalled its 11 March 1996 order and
cancelled the writ of execution.
Tirona filed her memorandum also on 25 March 1996. For the first time, Tirona disclosed that
Alipio Breton is the registered owner of the subject land and that he is her landlord since
1962. When Alipio Breton died in 1975, his children, Rosauro Breton and Maria Lourdes
Breton-Mendiola, inherited the subject land. Tirona claims she has never stopped paying her
rent to Maria Lourdes Breton-Mendiola. Tirona also stated that Rosauro Breton could not
transfer ownership to the subject land to Ocampo. On 14 July 1978, Rosauro Breton
executed a deed of conveyance and waiver in favor of his sister, Maria Lourdes Breton-
Mendiola. Rosauro Breton executed another deed of conveyance and waiver in favor of Maria
Lourdes Breton-Mendiola on 9 March 1995. Thus, Tirona claims, Ocampo cannot legally
acquire title from Rosauro Breton in view of the waivers. Maria Lourdes Breton-Mendiola is
Tirona’s lessor, and is the only person who can validly file an ejectment suit against Tirona.15
After quoting the findings of the MTC, the RTC held thus:
This Court after a careful review of the complete record of this case particularly the
evidences, applicable laws and jurisprudence relied upon by the [MTC] in finding for
[Ocampo] and declaring that [Tirona] can be lawfully ejected from the subject premises,
concurs with the findings thereof. There is therefore nothing in the record which would
warrant the Court to disturb the findings of fact and law and the conclusions reached by the
[MTC].
This Court finds the decision of the lower court fully justified in granting the reliefs to
[Ocampo].
WHEREFORE, judgment is hereby rendered AFFIRMING IN TOTO the decision of the [MTC]
with costs against [Tirona].
SO ORDERED.16
In its petition before the appellate court, Tirona stated that the RTC erred in the following
grounds:
1. ORDERING THE EJECTMENT OF [TIRONA] IN VIOLATION OF SECTION 2 OF PD [NO.]
2016.17
2. NOT RULING THAT [TIRONA] HAS A BETTER RIGHT OF POSSESSION OVER THE
PROPERTY IN QUESTION.
3. RULING THAT THE SUCCESSOR-IN-INTEREST OF AN UNDIVIDED IDEAL ONE-HALF
PORTION, [OCAMPO] MAY DEPRIVE THE OTHER CO-OWNER OF THE
ADMINISTRATION OF ONE-HALF PORTION BY EJECTING HER LESSEE, [TIRONA].18
The appellate court stated that the principal issue for its resolution is whether Ocampo, being
the buyer of the subject land which is not yet partitioned among the heirs, can validly evict
Tirona.19
The Appellate Court’s Ruling
The appellate court considered partition of the estate of Alipio Breton as a prerequisite to
Ocampo’s action. The appellate court ruled that "[u]ntil the partition of the estate is ordered by
the Regional Trial Court of Pasay City in the pending partition proceedings and the share of
each co-heir is determined by metes and bounds, [Ocampo] cannot rightfully claim that what
he bought is part of the property occupied by [Tirona]."20 The dispositive part of the appellate
court’s decision reads thus:
WHEREFORE, the decision of the respondent court is hereby SET ASIDE and judgment is
hereby rendered dismissing the complaint of the private respondent in the court below.
SO ORDERED.21
Hence, the instant petition.
The Issues
Ocampo assigned three errors to the appellate court. Ocampo stated that the appellate court
erred in:
1. ENTERTAINING AND NOT DISMISSING THE PETITION FOR REVIEW (with prayer for
its issuance of Writ of Preliminary Injunction and immediate issuance of TRO), THE SAME
HAVING BEEN FILED BEYOND THE REGLAMENTARY PERIOD.
2. CONSIDERING AND RESOLVING AN ISSUE RAISED IN THE PETITION FOR REVIEW
FOR THE FIRST TIME ON APPEAL.
3. DECLARING THAT LEONARDO R. OCAMPO HAS NO RIGHT TO EJECT LEONORA
TIRONA, NOR DEMAND PAYMENT OF RENTALS FROM HER FOR THE USE AND
OCCUPANCY OF THE LOT INVOLVED IN THE PRESENT CASE.22
The Ruling of the Court
The petition has merit.
We agree with Ocampo’s observation that Tirona changes her theory of the case each time
she appeals.23 For this reason, we shall limit our ruling to the propriety of Ocampo’s unlawful
detainer case against Tirona.
Moreover, we have assessed the evidence on record and found that the appellate court did
not contradict the findings of facts of the MTC and RTC. Thus, we see no reason to deviate
from their findings of facts.
Unlawful Detainer
Elements to be Proved
Unlawful detainer cases are summary in nature. The elements to be proved and resolved in
unlawful detainer cases are the fact of lease and expiration or violation of its terms. 24 To
support their conclusion that there was an existing lease, the MTC and RTC found that:
(1) Ocampo informed Tirona through a letter dated 1 March 1995 that he bought the subject
land, upon which Tirona’s house stands, from the previous owner and lessor Rosauro
Breton;25
(2) Tirona’s continued occupancy of the subject land signifies Tirona’s acceptance of
Ocampo’s conditions of lease stated in the 1 March 1995 letter;26 and
(3) In asserting her right to possess the subject land, Tirona admitted that Ocampo is her
lessor. In the 5 July 1995 letter, Tirona was referred to as "the hereinmentioned tenant of
yours."27
In Mirasol v. Magsuci, et al.,28 we ruled that the sale of a leased property places the vendee
into the shoes of the original lessor to whom the lessee bound himself to pay. The vendee
acquires the right to evict the lessee from the premises and to recover the unpaid rentals after
the vendee had notified the lessee that he had bought the leased property and that the
rentals on it should be paid to him, and the lessee refused to comply with the demand.
The following facts support the conclusion that there was a violation of the lease agreement:
(1) Tirona, through Callejo Law Office, sent a letter dated 5 July 1995 which stated that
Tirona will temporarily stop paying her monthly obligation until the National Housing Authority
has processed the pertinent papers regarding the amount due to Ocampo in view of PD
1517;29
(2) As of August 1995, Tirona has not paid her rent to Ocampo corresponding to April to
August 1995;30 and
(3) In a letter dated 7 August 1995, Ocampo demanded from Tirona unpaid rent payments.31
In view of these facts, we hold that Tirona is estopped from denying her possession under a
lease32 and that there was a violation of the lease agreement. Thus, the MTC and RTC
correctly ruled against Tirona.
Ownership as an Issue
When Tirona filed her answer before the MTC, she raised the issue of ownership and
ascribed ownership of the subject lot to one Doña Lourdes Rodriguez Yaneza. Tirona later
changed her strategy and filed an amended answer that ascribed ownership of the subject lot
to Maria Lourdes Breton-Mendiola. Tirona justified the amendment by stating that she did not
ask for the assistance of a lawyer for fear of not being able to file her answer on time. This
excuse is flimsy considering that Tirona first communicated to Ocampo through Callejo Law
Office. However, the MTC still allowed Tirona to amend her answer. Tirona stated that there
was no violation of the lease agreement because she paid her rent to the real owner, Maria
Lourdes Breton-Mendiola.
Contrary to Tirona’s position, the issue of ownership is not essential to an action for unlawful
detainer. The fact of the lease and the expiration of its term are the only elements of the
action. The defense of ownership does not change the summary nature of the action. The
affected party should raise the issue of ownership in an appropriate action, because a
certificate of title cannot be the subject of a collateral attack. 33 Although a wrongful possessor
may at times be upheld by the courts, this is merely temporary and solely for the maintenance
of public order. The question of ownership is to be settled in the proper court and in a proper
action.34
In actions for forcible entry and [unlawful] detainer, the main issue is possession de facto,
independently of any claim of ownership or possession de jure that either party may set forth
in his pleadings, and an appeal does not operate to change the nature of the original action.
On appeal, in an ejectment case, it is within the discretion of the court to look into the
evidence supporting the assigned errors relating to the alleged ownership of appellant insofar
as said evidence would indicate or determine the nature of appellant’s possession of the
controverted premises. Said court should not however resolve the issue raised by such
assigned errors. The resolution of said issues would effect an adjudication on ownership
which is not sanctioned in the summary action for unlawful detainer.35
Unlawful detainer being a summary proceeding, it was error for the appellate court to include
the issue of ownership. Had the appellate court limited its ruling to the elements to be proved
in a case of unlawful detainer, Ocampo need not even prove his ownership. When the
appellate court ruled that the case of unlawful detainer had to wait for the results of the
partition proceedings, it effectively put ownership as the main issue in the case. The issue of
ownership opens a virtual Pandora’s Box for Tirona and her supposed intervenor, Maria
Lourdes Breton-Mendiola.36
Interpleader
The good faith of Tirona is put in question in her preference for Maria Lourdes Breton-
Mendiola. As a stakeholder, Tirona should have used reasonable diligence in hailing the
contending claimants to court. Tirona need not have awaited actual institution of a suit by
Ocampo against her before filing a bill of interpleader.37 An action for interpleader is proper
when the lessee does not know the person to whom to pay rentals due to conflicting claims
on the property.38
The action of interpleader is a remedy whereby a person who has property whether personal
or real, in his possession, or an obligation to render wholly or partially, without claiming any
right in both, or claims an interest which in whole or in part is not disputed by the conflicting
claimants, comes to court and asks that the persons who claim the said property or who
consider themselves entitled to demand compliance with the obligation, be required to litigate
among themselves, in order to determine finally who is entitled to one or the other thing. The
remedy is afforded not to protect a person against a double liability but to protect him against
a double vexation in respect of one liability. When the court orders that the claimants litigate
among themselves, there arises in reality a new action and the former are styled
interpleaders, and in such a case the pleading which initiates the action is called a complaint
of interpleader and not a cross-complaint.39
Ocampo has the right to eject Tirona from the subject land. All the elements required for an
unlawful detainer case to prosper are present. Ocampo notified Tirona that he purchased the
subject land from Tirona’s lessor. Tirona’s continued occupation of the subject land amounted
to acquiescence to Ocampo’s terms. However, Tirona eventually refused to pay rent to
Ocampo, thus violating the lease.
Finally, legal interest at the annual rate of 6% is due on the unpaid monthly rentals starting
from 7 August 1995 when Ocampo made an extrajudicial demand on Tirona for payment of
the monthly rental.40 On finality of our decision, annual interest at 12%, in lieu of 6% annual
interest, is due on the amounts the MTC awarded until full payment.41
WHEREFORE, we GRANT the instant petition for review. The Decision dated 27 June 1996
of Branch 110 of the RTC in Civil Case No. 96-0209, which affirmed the Decision dated 29
December 1995 of Branch 47 of the MTC in Civil Case No. 754-95, is REINSTATED. The
Decision dated 29 November 2000 of the appellate court in CA-G.R. SP No. 41686, and its
Resolution dated 16 April 2001 denying the motion for reconsideration, are SET ASIDE.
SO ORDERED.
[G.R. NO. 136409 : March 14, 2008]
SUBHASH C. PASRICHA and JOSEPHINE A. PASRICHA, Petitioners, v. DON
LUIS DISON REALTY, INC., Respondent.
DECISION
NACHURA, J.:
This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court
seeking the reversal of the Decision1 of the Court of Appeals (CA) dated May 26,
1998 and its Resolution2 dated December 10, 1998 in CA-G.R. SP No. 37739
dismissing the petition filed by petitioners Josephine and Subhash Pasricha.
The facts of the case, as culled from the records, are as follows:
Respondent Don Luis Dison Realty, Inc. and petitioners executed two Contracts of
Lease3 whereby the former, as lessor, agreed to lease to the latter Units 22, 24,
32, 33, 34, 35, 36, 37 and 38 of the San Luis Building, located at 1006 M.Y.
Orosa cor. T.M. Kalaw Streets, Ermita, Manila. Petitioners, in turn, agreed to pay
monthly rentals, as follows:
For Rooms 32/35:
From March 1, 1991 to August 31, 1991 - P5,000.00/P10,000.00
From September 1, 1991 to February 29, 1992 - P5,500.00/P11,000.00
From March 1, 1992 to February 28, 1993 - P6,050.00/P12,100.00
From March 1, 1993 to February 28, 1994 - P6,655.00/P13,310.00
From March 1, 1994 to February 28, 1995 - P7,320.50/P14,641.00
From March 1, 1995 to February 28, 1996 - P8,052.55/P16,105.10
From March 1, 1996 to February 29, 1997 - P8,857.81/P17,715.61
From March 1, 1997 to February 28, 1998 - P9,743.59/P19,487.17
From March 1, 1998 to February 28, 1999 - P10,717.95/P21,435.89
From March 1, 1999 to February 28, 2000 - P11,789.75/P23,579.484
For Rooms 22 and 24:
Effective July 1, 1992 - P10,000.00 with an increment of 10% every two years.5
For Rooms 33 and 34:
Effective April 1, 1992 - P5,000.00 with an increment of 10% every two years.6
For Rooms 36, 37 and 38:
Effective when tenants vacate said premises - P10,000.00 with an increment of
10% every two years.7
Petitioners were, likewise, required to pay for the cost of electric consumption,
water bills and the use of telephone cables.8
The lease of Rooms 36, 37 and 38 did not materialize leaving only Rooms 22, 24,
32, 33, 34 and 35 as subjects of the lease contracts. 9 While the contracts were in
effect, petitioners dealt with Francis Pacheco (Pacheco), then General Manager of
private respondent. Thereafter, Pacheco was replaced by Roswinda Bautista (Ms.
Bautista).10 Petitioners religiously paid the monthly rentals until May 1992.11 After
that, however, despite repeated demands, petitioners continuously refused to pay
the stipulated rent. Consequently, respondent was constrained to refer the
matter to its lawyer who, in turn, made a final demand on petitioners for the
payment of the accrued rentals amounting to P916,585.58.12 Because petitioners
still refused to comply, a complaint for ejectment was filed by private respondent
through its representative, Ms. Bautista, before the Metropolitan Trial Court
(MeTC) of Manila.13 The case was raffled to Branch XIX and was docketed as Civil
Case No. 143058-CV.
Petitioners admitted their failure to pay the stipulated rent for the leased
premises starting July until November 1992, but claimed that such refusal was
justified because of the internal squabble in respondent company as to the
person authorized to receive payment.14 To further justify their non-payment of
rent, petitioners alleged that they were prevented from using the units (rooms)
subject matter of the lease contract, except Room 35. Petitioners eventually paid
their monthly rent for December 1992 in the amount of P30,000.00, and claimed
that respondent waived its right to collect the rents for the months of July to
November 1992 since petitioners were prevented from using Rooms 22, 24, 32,
33, and 34.15 However, they again withheld payment of rents starting January
1993 because of respondent's refusal to turn over Rooms 36, 37 and 38.16 To
show good faith and willingness to pay the rents, petitioners alleged that they
prepared the check vouchers for their monthly rentals from January 1993 to
January 1994.17 Petitioners further averred in their Amended Answer18 that the
complaint for ejectment was prematurely filed, as the controversy was not
referred to the barangay for conciliation.
For failure of the parties to reach an amicable settlement, the pre-trial conference
was terminated. Thereafter, they submitted their respective position papers.
On November 24, 1994, the MeTC rendered a Decision dismissing the complaint
for ejectment.19 It considered petitioners' non-payment of rentals as unjustified.
The court held that mere willingness to pay the rent did not amount to payment
of the obligation; petitioners should have deposited their payment in the name of
respondent company. On the matter of possession of the subject premises, the
court did not give credence to petitioners' claim that private respondent failed to
turn over possession of the premises. The court, however, dismissed the
complaint because of Ms. Bautista's alleged lack of authority to sue on behalf of
the corporation.
Deciding the case on appeal, the Regional Trial Court (RTC) of Manila, Branch 1,
in Civil Case No. 94-72515, reversed and set aside the MeTC Decision in this
wise:
WHEREFORE, the appealed decision is hereby reversed and set aside and another
one is rendered ordering defendants-appellees and all persons claiming rights
under them, as follows:
(1) to vacate the leased premised (sic) and restore possession thereof to
plaintiff-appellant;
(2) to pay plaintiff-appellant the sum of P967,915.80 representing the accrued
rents in arrears as of November 1993, and the rents on the leased premises for
the succeeding months in the amounts stated in paragraph 5 of the complaint
until fully paid; andcralawlibrary
(3) to pay an additional sum equivalent to 25% of the rent accounts as and for
attorney's fees plus the costs of this suit.
SO ORDERED.20
The court adopted the MeTC's finding on petitioners' unjustified refusal to pay the
rent, which is a valid ground for ejectment. It, however, faulted the MeTC in
dismissing the case on the ground of lack of capacity to sue. Instead, it upheld
Ms. Bautista's authority to represent respondent notwithstanding the absence of
a board resolution to that effect, since her authority was implied from her power
as a general manager/treasurer of the company.21
Aggrieved, petitioners elevated the matter to the Court of Appeals in a Petition
for Review on Certiorari .22 On March 18, 1998, petitioners filed an Omnibus
Motion23 to cite Ms. Bautista for contempt; to strike down the MeTC and RTC
Decisions as legal nullities; and to conduct hearings and ocular inspections or
delegate the reception of evidence. Without resolving the aforesaid motion, on
May 26, 1998, the CA affirmed24 the RTC Decision but deleted the award of
attorney's fees.25
Petitioners moved for the reconsideration of the aforesaid decision.26 Thereafter,
they filed several motions asking the Honorable Justice Ruben T. Reyes to inhibit
from further proceeding with the case allegedly because of his close association
with Ms. Bautista's uncle-in-law.27
In a Resolution28 dated December 10, 1998, the CA denied the motions for lack of
merit. The appellate court considered said motions as repetitive of their previous
arguments, irrelevant and obviously dilatory.29 As to the motion for inhibition of
the Honorable Justice Reyes, the same was denied, as the appellate court justice
stressed that the decision and the resolution were not affected by extraneous
matters.30 Lastly, the appellate court granted respondent's motion for execution
and directed the RTC to issue a new writ of execution of its decision, with the
exception of the award of attorney's fees which the CA deleted.31
Petitioners now come before this Court in this Petition for
on Certiorari raising the following issues:
I.
Whether this ejectment suit should be dismissed and whether petitioners are
entitled to damages for the unauthorized and malicious filing by Rosario (sic)
Bautista of this ejectment case, it being clear that [Roswinda] - whether as
general manager or by virtue of her subsequent designation by the Board of
Directors as the corporation's attorney-in-fact - had no legal capacity to institute
the ejectment suit, independently of whether Director Pacana's Order setting
aside the SEC revocation Order is a mere scrap of paper.
II.
Whether the RTC's and the Honorable Court of Appeals' failure and refusal to
resolve the most fundamental factual issues in the instant ejectment case render
said decisions void on their face by reason of the complete abdication by the RTC
and the Honorable Justice Ruben Reyes of their constitutional duty not only to
clearly and distinctly state the facts and the law on which a decision is based but
also to resolve the decisive factual issues in any given case.
III.
Whether the (1) failure and refusal of Honorable Justice Ruben Reyes to inhibit
himself, despite his admission - by reason of his silence - of petitioners'
accusation that the said Justice enjoyed a $7,000.00 scholarship grant courtesy
of the uncle-in-law of respondent "corporation's" purported general manager and
(2), worse, his act of ruling against the petitioners and in favor of the respondent
"corporation" constitute an unconstitutional deprivation of petitioners' property
without due process of law.32
Review
In addition to Ms. Bautista's lack of capacity to sue, petitioners insist that
respondent company has no standing to sue as a juridical person in view of the
suspension and eventual revocation of its certificate of registration.33 They
likewise question the factual findings of the court on the bases of their ejectment
from the subject premises. Specifically, they fault the appellate court for not
finding that: 1) their non-payment of rentals was justified; 2) they were deprived
of possession of all the units subject of the lease contract except Room 35; and
3) respondent violated the terms of the contract by its continued refusal to turn
over possession of Rooms 36, 37 and 38. Petitioners further prayed that a
Temporary Restraining Order (TRO) be issued enjoining the CA from enforcing its
Resolution directing the issuance of a Writ of Execution. Thus, in a
Resolution34 dated January 18, 1999, this Court directed the parties to maintain
the status quo effective immediately until further orders.
The petition lacks merit.
We uphold the capacity of respondent company to institute the ejectment case.
Although the Securities and Exchange Commission (SEC) suspended and
eventually revoked respondent's certificate of registration on February 16, 1995,
records show that it instituted the action for ejectment on December 15, 1993.
Accordingly, when the case was commenced, its registration was not yet
revoked.35 Besides, as correctly held by the appellate court, the SEC later set
aside its earlier orders of suspension and revocation of respondent's certificate,
rendering the issue moot and academic.36
We likewise affirm Ms. Bautista's capacity to sue on behalf of the company
despite lack of proof of authority to so represent it. A corporation has no powers
except those expressly conferred on it by the Corporation Code and those that
are implied from or are incidental to its existence. In turn, a corporation exercises
said powers through its board of directors and/or its duly authorized officers and
agents. Physical acts, like the signing of documents, can be performed only by
natural persons duly authorized for the purpose by corporate by-laws or by a
specific act of the board of directors.37 Thus, any person suing on behalf of the
corporation should present proof of such authority. Although Ms. Bautista initially
failed to show that she had the capacity to sign the verification and institute the
ejectment case on behalf of the company, when confronted with such question,
she immediately presented the Secretary's Certificate38 confirming her authority
to represent the company.
There is ample jurisprudence holding that subsequent and substantial compliance
may call for the relaxation of the rules of procedure in the interest of justice. 39 In
Novelty Phils., Inc. v. Court of Appeals,40 the Court faulted the appellate court for
dismissing a petition solely on petitioner's failure to timely submit proof of
authority to sue on behalf of the corporation. In Pfizer, Inc. v. Galan, 41 we upheld
the sufficiency of a petition verified by an employment specialist despite the total
absence of a board resolution authorizing her to act for and on behalf of the
corporation. Lastly, in China Banking Corporation v. Mondragon International
Philippines, Inc,42 we relaxed the rules of procedure because the corporation
ratified the manager's status as an authorized signatory. In all of the above
cases, we brushed aside technicalities in the interest of justice. This is not to say
that we disregard the requirement of prior authority to act in the name of a
corporation. The relaxation of the rules applies only to highly meritorious cases,
and when there is substantial compliance. While it is true that rules of procedure
are intended to promote rather than frustrate the ends of justice, and while the
swift unclogging of court dockets is a laudable objective, we should not insist on
strict adherence to the rules at the expense of substantial justice.43 Technical and
procedural rules are intended to help secure, not suppress, the cause of justice;
and a deviation from the rigid enforcement of the rules may be allowed to attain
that prime objective, for, after all, the dispensation of justice is the core reason
for the existence of courts.44
As to the denial of the motion to inhibit Justice Reyes, we find the same to be in
order. First, the motion to inhibit came after the appellate court rendered the
assailed decision, that is, after Justice Reyes had already rendered his opinion on
the merits of the case. It is settled that a motion to inhibit shall be denied if filed
after a member of the court had already given an opinion on the merits of the
case, the rationale being that "a litigant cannot be permitted to speculate on the
action of the court x x x (only to) raise an objection of this sort after the decision
has been rendered."45 Second, it is settled that mere suspicion that a judge is
partial to one of the parties is not enough; there should be evidence to
substantiate the suspicion. Bias and prejudice cannot be presumed, especially
when weighed against a judge's sacred pledge under his oath of office to
administer justice without regard for any person and to do right equally to the
poor and the rich. There must be a showing of bias and prejudice stemming from
an extrajudicial source, resulting in an opinion on the merits based on something
other than what the judge learned from his participation in the case. 46 We would
like to reiterate, at this point, the policy of the Court not to tolerate acts of
litigants who, for just about any conceivable reason, seek to disqualify a judge
(or justice) for their own purpose, under a plea of bias, hostility, prejudice or
prejudgment.47
We now come to the more substantive issue of whether or not the petitioners
may be validly ejected from the leased premises.
Unlawful detainer cases are summary in nature. In such cases, the elements to
be proved and resolved are the fact of lease and the expiration or violation of its
terms.48 Specifically, the essential requisites of unlawful detainer are: 1) the fact
of lease by virtue of a contract, express or implied; 2) the expiration or
termination of the possessor's right to hold possession; 3) withholding by the
lessee of possession of the land or building after the expiration or termination of
the right to possess; 4) letter of demand upon lessee to pay the rental or comply
with the terms of the lease and vacate the premises; and 5) the filing of the
action within one year from the date of the last demand received by the
defendant.49
It is undisputed that petitioners and respondent entered into two separate
contracts of lease involving nine (9) rooms of the San Luis Building. Records,
likewise, show that respondent repeatedly demanded that petitioners vacate the
premises, but the latter refused to heed the demand; thus, they remained in
possession of the premises. The only contentious issue is whether there was
indeed a violation of the terms of the contract: on the part of petitioners, whether
they failed to pay the stipulated rent without justifiable cause; while on the part
of respondent, whether it prevented petitioners from occupying the leased
premises except Room 35.
This issue involves questions of fact, the resolution of which requires the
evaluation of the evidence presented. The MeTC, the RTC and the CA all found
that petitioners failed to perform their obligation to pay the stipulated rent. It is
settled doctrine that in a civil case, the conclusions of fact of the trial court,
especially when affirmed by the Court of Appeals, are final and conclusive, and
cannot be reviewed on appeal by the Supreme Court.50 Albeit the rule admits of
exceptions, not one of them obtains in this case.51
To settle this issue once and for all, we deem it proper to assess the array of
factual findings supporting the court's conclusion.
The evidence of petitioners' non-payment of the stipulated rent is overwhelming.
Petitioners, however, claim that such non-payment is justified by the following:
1) the refusal of respondent to allow petitioners to use the leased properties,
except room 35; 2) respondent's refusal to turn over Rooms 36, 37 and 38; and
3) respondent's refusal to accept payment tendered by petitioners.
Petitioners' justifications are belied by the evidence on record. As correctly held
by the CA, petitioners' communications to respondent prior to the filing of the
complaint never mentioned their alleged inability to use the rooms.52 What they
pointed out in their letters is that they did not know to whom payment should be
made, whether to Ms. Bautista or to Pacheco.53 In their July 26 and October 30,
1993 letters, petitioners only questioned the method of computing their electric
billings without, however, raising a complaint about their failure to use the
rooms.54 Although petitioners stated in their December 30, 1993 letter that
respondent failed to fulfill its part of the contract,55 nowhere did they specifically
refer to their inability to use the leased rooms. Besides, at that time, they were
already in default on their rentals for more than a year.
If it were true that they were allowed to use only one of the nine (9) rooms
subject of the contract of lease, and considering that the rooms were intended for
a business purpose, we cannot understand why they did not specifically assert
their right. If we believe petitioners' contention that they had been prevented
from using the rooms for more than a year before the complaint for ejectment
was filed, they should have demanded specific performance from the lessor and
commenced an action in court. With the execution of the contract, petitioners
were already in a position to exercise their right to the use and enjoyment of the
property according to the terms of the lease contract. 56 As borne out by the
records, the fact is that respondent turned over to petitioners the keys to the
leased premises and petitioners, in fact, renovated the rooms. Thus, they were
placed in possession of the premises and they had the right to the use and
enjoyment of the same. They, likewise, had the right to resist any act of intrusion
into their peaceful possession of the property, even as against the lessor itself.
Yet, they did not lift a finger to protect their right if, indeed, there was a violation
of the contract by the lessor.
What was, instead, clearly established by the evidence was petitioners' non-
payment of rentals because ostensibly they did not know to whom payment
should be made. However, this did not justify their failure to pay, because if such
were the case, they were not without any remedy. They should have availed of
the provisions of the Civil Code of the Philippines on the consignation of payment
and of the Rules of Court on interpleader.
Article 1256 of the Civil Code provides:
Article 1256. If the creditor to whom tender of payment has been made refuses
without just cause to accept it, the debtor shall be released from responsibility by
the consignation of the thing or sum due.
Consignation alone shall produce the same effect in the following cases:
xxx
(4) When two or more persons claim the same right to collect;
x x x x.
Consignation shall be made by depositing the things due at the disposal of a
judicial authority, before whom the tender of payment shall be proved in a proper
case, and the announcement of the consignation in other cases.57
In the instant case, consignation alone would have produced the effect of
payment of the rentals. The rationale for consignation is to avoid the
performance of an obligation becoming more onerous to the debtor by reason of
causes not imputable to him.58 Petitioners claim that they made a written tender
of payment and actually prepared vouchers for their monthly rentals. But that
was insufficient to constitute a valid tender of payment. Even assuming that it
was valid tender, still, it would not constitute payment for want of consignation of
the amount. Well-settled is the rule that tender of payment must be accompanied
by consignation in order that the effects of payment may be produced.59
Moreover, Section 1, Rule 62 of the Rules of Court provides:
Section 1. When interpleader proper. - Whenever conflicting claims upon the
same subject matter are or may be made against a person who claims no interest
whatever in the subject matter, or an interest which in whole or in part is not
disputed by the claimants, he may bring an action against the conflicting
claimants to compel them to interplead and litigate their several claims among
themselves.
Otherwise stated, an action for interpleader is proper when the lessee does not
know to whom payment of rentals should be made due to conflicting claims on
the property (or on the right to collect).60 The remedy is afforded not to protect a
person against double liability but to protect him against double vexation in
respect of one liability.61
Notably, instead of availing of the above remedies, petitioners opted to refrain
from making payments.
Neither can petitioners validly invoke the non-delivery of Rooms 36, 37 and 38 as
a justification for non-payment of rentals. Although the two contracts embraced
the lease of nine (9) rooms, the terms of the contracts - with their particular
reference to specific rooms and the monthly rental for each - easily raise the
inference that the parties intended the lease of each room separate from that of
the others.ςηαñrοblεš  Î½Î¹r†υαl  lαω  lιbrαrÿ
There is nothing in the contract which would lead to the conclusion that the lease
of one or more rooms was to be made dependent upon the lease of all the nine
(9) rooms. Accordingly, the use of each room by the lessee gave rise to the
corresponding obligation to pay the monthly rental for the same. Notably,
respondent demanded payment of rentals only for the rooms actually delivered
to, and used by, petitioners.
It may also be mentioned that the contract specifically provides that the lease of
Rooms 36, 37 and 38 was to take effect only when the tenants thereof would
vacate the premises. Absent a clear showing that the previous tenants had
vacated the premises, respondent had no obligation to deliver possession of the
subject rooms to petitioners. Thus, petitioners cannot use the non-delivery of
Rooms 36, 37 and 38 as an excuse for their failure to pay the rentals due on the
other rooms they occupied.ςηαñrοblεš  Î½Î¹r†υαl  lαω  lιbrαrÿ
In light of the foregoing disquisition, respondent has every right to exercise his
right to eject the erring lessees. The parties' contracts of lease contain identical
provisions, to wit:
In case of default by the LESSEE in the payment of rental on the fifth (5th) day of
each month, the amount owing shall as penalty bear interest at the rate of FOUR
percent (4%) per month, to be paid, without prejudice to the right of the LESSOR
to terminate his contract, enter the premises, and/or eject the LESSEE as
hereinafter set forth;62
Moreover, Article 167363 of the Civil Code gives the lessor the right to judicially
eject the lessees in case of non-payment of the monthly rentals. A contract of
lease is a consensual, bilateral, onerous and commutative contract by which the
owner temporarily grants the use of his property to another, who undertakes to
pay the rent therefor.64 For failure to pay the rent, petitioners have no right to
remain in the leased premises.
WHEREFORE, premises considered, the petition is DENIED and the Status Quo
Order dated January 18, 1999 is hereby LIFTED. The Decision of the Court of
Appeals dated May 26, 1998 and its Resolution dated December 10, 1998 in CA-
G.R. SP No. 37739 are AFFIRMED.
SO ORDERED.
G.R. No. L-26443               March 25, 1969
MAKATI DEVELOPMENT CORPORATION, plaintiff-appellant,
vs.
PEDRO C. TANJUATCO and CONCRETE AGGREGATES, INC., defendants-appellees.
Salvador J. Lorayes for plaintiff-appellant.
P. C. Tanjuatco and F. Garcia for defendants-appellees.
CONCEPCION, C.J.:
  Appeal by plaintiff Makati Development Corporation from an order of dismissal of the Court
of First Instance of Rizal (Pasig), predicated upon lack of jurisdiction.
  On February 21, 1963, said plaintiff and defendant Pedro C. Tanjuatco entered into a
contract whereby the latter bound himself to construct a reinforced concrete covered water
reservoir, office and pump house and water main at Forbes Park, Makati, Rizal, furnishing,
inter alia, the materials necessary therefor. Before making the final payment of the
consideration agreed upon, plaintiff inquired from the suppliers of materials, who had called
its attention to unpaid bills therefor of Tanjuatco, whether the latter had settled his accounts
with them. In response to this inquiry, Concrete Aggregates, Inc. — hereinafter referred to as
the Supplier — made a claim in the sum of P5,198.75, representing the cost of transit-mixed
concrete allegedly delivered to Tanjuatco. With his consent, plaintiff withheld said amount
from the final payment made to him and, in view of his subsequent failure to settle the issue
thereon with the Supplier, on September 16, 1955, plaintiff instituted the present action, in the
Court of First Instance of Rizal, against Tanjuatco and the Supplier, to compel them "to
interplead their conflicting claims."
  On October 4, 1965, Tanjuatco moved to dismiss the case, upon the ground that the court
had no jurisdiction over the subject-matter of the litigation, the amount involved therein being
less than P10,000.00. 1 Finding this motion "to be well-taken", the lower court granted the
same, over plaintiffs opposition thereto, and, accordingly, issued an order, dated November
16, 1965, dismissing the case, without costs. Hence, this appeal, in which plaintiff maintains
that the subject-matter of this litigation is not the aforementioned sum of P5,198.75, but the
right to compel the defendants "to litigate among themselves" in order to protect the plaintiff
"against a double vexation in respect to one liability."
  We find no merit in this contention. There is no question in this case that plaintiff may
compel the defendants to interplead among themselves, concerning the aforementioned sum
of P5,198.75. The only issue is who among the defendants is entitled to collect the same.
This is the object of the action, which is not within the jurisdiction of the lower court. As a
matter of fact, on May 25, 1966 the Supplier sued Tanjuatco, in Civil Case No. 149173 of the
Municipal Court of Manila, for the recovery of said amount of P5,198.75, and the decision
therein will settle the question as to who has a right to the sum withheld by plaintiff
herein.lawphi1.ñet
  The latter relies upon Rule 63 of the present Rules of Court, prescribing the procedure in
cases of interpleading, and section 19 of Rule 5 of said Rules of Court, which, unlike section
19 of Rule 4 of the Old Rules, omits the Rules on Interpleading among those made applicable
to inferior courts. This fact does not warrant, however, the conclusion drawn therefrom by
plaintiff herein. To begin with, the jurisdiction of our courts over the subject-matter of
justiciable controversies is governed by Rep. Act No. 296, as amended, pursuant to
which 2 municipal courts shall have exclusive original jurisdiction in all civil cases "in which the
demand, exclusive of interest, or the value of the property in controversy", amounts to not
more than "ten thousand pesos." Secondly, "the power to define, prescribe, and apportion the
jurisdiction of the various courts" belongs to Congress  3 and is beyond the rule-making power
of the Supreme Court, which is limited to matters concerning pleading, practice, and
procedure in all courts, and the admission to the practice of law.  4 Thirdly, the failure of said
section 19 of Rule 5 of the present Rules of Court to make its Rule 63, on interpleading,
applicable to inferior courts, merely implies that the same are not bound to follow Rule 63 in
dealing with cases of interpleading, but may apply thereto the general rules on procedure
applicable to ordinary civil action in said courts.

  WHEREFORE, the order appealed from is hereby affirmed, with the costs of this instance
against plaintiff Makati Development Corporation. It is so ordered.