Case Digest (G.R. No. L-47350)
Facts:
F. S. Divinagracia Agro-Commercial, Inc. v. Honorable Court of Appeals and Rufino Fernandez, G.R. No. L-47350, April 21, 1981, Supreme Court First Division, Guerrero, J., writing for the Court.Petitioner F. S. Divinagracia Agro-Commercial, Inc. purchased a building and lot on July 9, 1974 from the intestate estate of the original owners. Private respondent Rufino Q. Fernandez (hereafter "private respondent") succeeded his father as lessee of the premises under a lease dating from 1899 and had been occupying the premises and paying rent continuously; after the sale he paid part of July 1974 rent to the former owners and part to petitioner. A verbal agreement raised the monthly rent to P2,000 beginning August 1974 and this arrangement continued until September 1975.
Petitioner informed private respondent in October 1975 that the lease would terminate on October 31, 1975, followed by a formal letter dated November 4, 1975 giving a final extension to the end of November 1975 and refusing to accept December rent; private respondent instead deposited later rentals with the Clerk of Court. Petitioner then filed an unlawful detainer complaint in the City Court of Iloilo (Branch I). The City Court dismissed the complaint, fixed reasonable rent at P3,000 starting January 1976, and — applying the rule of one year for every ten years of occupancy — fixed the remaining duration of the lease at seven and a half (7½) years from finality.
Petitioner appealed to the Court of First Instance (now Regional Trial Court), which (i) dismissed the complaint, (ii) also fixed reasonable rent at P3,000 starting January 1976, but (iii) reduced the extended duration to one (1) year from finality. Private respondent appealed to the Court of Appeals, which modified the lower court by extending the lease for another five (5) years while affirming the other portions of the judgment. Petitioner then filed a petition for certiorari with the Supreme Court ...(Subscriber-Only)
Issues:
- Did the Court of Appeals commit a grave abuse of discretion amounting to lack or excess of jurisdiction in extending the lease for five years under Article 1687 of the New Civil Code?
- Was the Court of Appeals' exercise of its power under Article 1687 (in relation to Article 1197 and Article 1676 of the New Civil Code) to fix a longer term properly exercised given the facts (change of ownership, commercial character of the lot, alleged understanding that petitioner might need the premises, existence of anothe...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
- (Subscriber-Only)