G.R. No. 7969 - People vs Chua Mo

In April 1951, a Contract of Lease was executed between plaintiff Alberto Malicsi and the late Tan Cuan.
The lease covered a portion of Lot No. P. L. 6, Plan 11-10173, Case 7880, situated in Zamboanga City, specifically an area of approximately 180 square meters with a market value of P5,400.00.
The leased property was evidenced by TCT No. T-6370 and was located along Guardia Nacional St.
The lease was for a period of seventeen (17) years at a monthly rental of P200.00, payable on or before the 10th day of every succeeding month.

After the death of Tan Cuan in May 1955, defendant Rosalia Carpizo, acting as administratrix of his estate, intermittently made rental payments.
Plaintiff alleged that despite repeated demands, defendant failed to pay the monthly rentals for January and February 1958.
Plaintiff further claimed that defendant’s refusal to comply with her payment obligations compelled him to engage counsel at a fee amounting to P500.00.

Plaintiff prayed for the cancellation (rescission) of the Contract of Lease dated April 6, 1951.
He requested an order directing defendant to vacate the premises within 30 days of the decision's receipt.
Plaintiff further sought recovery of accrued rental dues amounting to P400.00 for January and February 1958, with interest from the filing date of the complaint.
Additional relief included the continued assessment of rental at P200.00 per month until the defendant vacated the property, along with P500.00 as attorney's fees and the costs of the proceedings.

On her answer, filed on April 7, 1958, defendant admitted the existence of the lease contract but denied neglect in payment.
She asserted that rental payments had been made in advance, totaling at least P700.00, collected from a restaurant at P70.00 per month over ten (10) months.
As a special defense, defendant contended that the estate funds had been deposited with the Clerk of Court of Zamboanga City due to a pending certiorari case initiated by Tan Gin San.
Defendant filed a counterclaim seeking:

Plaintiff responded to the counterclaim with his answer filed on April 16, 1958.

The case was fully tried with both parties having their issues joined for resolution.
Plaintiff presented documentary evidence including:

The contract of lease marked as Annex ‘A’ (identified as Exhibit ‘A’ for purposes of identification);
A petition (Exhibit ‘B’) and subsequent documents from a Special Case No. 411 reflecting defendant’s withdrawal orders and payments to third parties related to rental obligations; and
Additional supporting exhibits (Exhibits ‘C’, ‘C-1’, ‘C-2’, and ‘C-3’) showing detailed reports of payments.

Defendant admitted her account with the plaintiff and promised to settle the unpaid rentals in installments, though she did not submit further evidence for her defense.

On March 16, 1960, the trial court rendered a decision in favor of the plaintiff.
The court declared the lease contract, evidenced by Annex/Exhibit ‘A’, as rescinded owing to the defendant’s default in paying the stipulated monthly rental for January and February 1958.
The judgment ordered defendant to:

Vacate the leased property within 30 days;
Pay the accrued rentals (P400.00) plus 6% interest from the filing date of the complaint;
Continue paying P200.00 monthly until the premises were vacated; and
Remit P500.00 as attorney's fees along with the costs of the proceedings.

Defendant, dissatisfied with the trial court’s ruling on the rescission of the contract and related orders, filed an appeal.
Her main contention on appeal was that a lease contract is not included among those contracts legally subject to rescission under Article 1381 of the Civil Code, and thus the trial court erred in declaring it rescinded.
Defendant also argued that the claim for unpaid rentals should be directed against the estate of the late Tan Cuan rather than personally against her as the administratrix.

Whether the trial court properly rescinded the lease contract based on the defendant’s non-compliance with her payment obligations.

The issue revolved around whether a lease contract, by its nature or statutory provisions under Article 1381 and Article 1659 of the Civil Code, may be rescinded for non-payment of the stipulated rental.
It required determining if defendant’s default on paying the monthly rental for January and February 1958 constituted a sufficient breach to justify rescission.

Whether the claim for unpaid rentals should be properly filed against the estate of Tan Cuan or against defendant personally in her capacity as administratrix.

This issue involved the interpretation of Section 1, Rule 88 of the Rules of Court regarding actions that may be initiated against an executor or administratrix.
The question also encompassed whether only money claims accrued prior to the death of the decedent could be filed against the estate, considering the lease obligations continued beyond the date of death.