G.R. No. 32047 - Melencio vs. Dy Tiao Lay

Plaintiffs: Manuel, Mariano, Pura, and Caridad Melencio, heirs of Ramon Melencio.
Defendant: Dy Tiao Lay, lessee of a parcel of land in Cabanatuan, Nueva Ecija, measuring 4,628.25 square meters.
The plaintiffs sought:

Recovery of possession of said land.
Monthly rental of P300 from May 1926 until surrender of possession.
Declaration that any lease contract was null and void for lack of consent and ratification by owners.

Defendant claimed possession under a lease contract executed July 24, 1905, by Ruperta Garcia, Pedro R. Melencio, Juliana Melencio, and Ruperta Melencio (predecessors-in-interest).
Lease terms: 20 years, extendible for two additional 20-year terms at lessee’s option, initially at P25/month rent, later reduced to P20.20.
Purpose: Establish rice mill, warehouses, and employee quarters.
The lease document was duly acknowledged but not registered with the Register of Deeds.
The original lessee Yap Kui Chin died in 1912; interests passed through different persons ending with Dy Tiao Lay.
Pedro R. Melencio acted as property manager until his death in 1920.

Land originally owned by Julian Melencio, who died before 1905, leaving widow Ruperta Garcia and five children including Ramon and Pedro R. Melencio.
Ruperta Garcia held a widow’s usufruct, not community property.
Ramon Melencio died in 1914; his widow Liberata Macapagal was appointed administratrix of his estate.
In 1920, heirs made an extrajudicial partition assigning the land to children of Ramon Melencio, represented by their mother Liberata.

Ruperta Garcia was not a coowner.
Contract executed without consent of all coowners, specifically Ramon and Jose P. Melencio and lacks marital consent of Juliana and Ruperta Melencio’s husbands.
Lease violated by lessee and was executed without administratrix’s authority; thus null and void.

Defendant alleged valid lease duly ratified by Liberata Macapagal through acceptance of rent until 1926.
Defendant deposited rent monthly with clerk of court after refusal to pay by plaintiffs.
Trial court ruled in favor of defendant, declaring lease valid, and awarded damages on counterclaim. Plaintiffs appealed.

Defendant claimed plaintiffs are estopped due to acceptance of benefits under the lease and invoked prescription.
No evidence showed plaintiffs or Ramon Melencio knew about the lease before 1926.
Plaintiffs rejected estoppel and prescription defenses.

Ramon Melencio enjoyed benefits under lease 1905-1914; widow and children accepted rents until repudiation in 1926.
Lease terms and improvements were visible and known to Ramon Melencio.
Original lease was not questioned by signatories or initiators of the contract.
After 1920 partition, land was assigned precisely to family of Ramon Melencio, the only coowner not a party to the lease.
The defendant had held possession and erected valuable improvements on the property.

Is the contract of lease executed on July 24, 1905, valid and binding on all coowners, including Ramon Melencio and his heirs, despite non-consent and lack of ratification?
Does a lease for a period exceeding six years executed by a majority of coowners without unanimous consent bind all coowners?
Does acceptance of benefits under the lease by Ramon Melencio and his heirs estop them from questioning its validity?
Can the defendant claim prescription and estoppel against the plaintiffs for the possession and use of the land?
Are the alterations and improvements made on the land under the lease legally permissible without consent of all coowners?
Is the defendant entitled to recover rent and counterclaim damages?