Case Summary (G.R. No. L-23771)
Petitioner
Colegio Medico-Farmaceutico de Filipinas, Inc., owner of a building in Sampaloc, Manila
Respondent
Lily Lim, occupying the leased property under an alleged assignment from St. John Berchman School of Manila Foundation
Key Dates
• Original lease: June 2003–May 2013 (10-year term)
• Short-term lease: June 2005–May 2006 (advance payment)
• Board decision not to renew: December 2007
• Demand letter: March 5, 2008
• Complaint for ejectment filed: June 19, 2008
• MeTC decision dismissing complaint: June 1, 2009
• RTC reversal and judgment: May 13, 2010
• CA decision dismissing complaint: June 13, 2013
• CA resolution denying reconsideration: April 7, 2014
• Supreme Court decision: July 2, 2018
Applicable Law
• 1987 Philippine Constitution (governing since case decision is post-1990)
• Corporation Code, Section 23 (corporate powers exercised by Board of Directors)
• By-laws of petitioner, Article IV, Section 2 (president’s powers)
• Rules of Court, Rule 45 (petition for review on certiorari)
• Unlawful detainer requisites under jurisprudence (Dela Cruz v. CA)
Factual Background
Petitioner is registered owner of the subject property. In June 2005, it entered a one-year lease with respondent; after its expiration, the Board decided not to renew. On March 5, 2008, petitioner’s president issued a demand letter for unpaid rentals and utilities totaling ₱604,936.35 and requested vacation by March 16, 2008. Respondent refused, asserting a continuing 10-year lease through May 2013 and alleging withheld rent was justified by petitioner’s failure to repair facilities.
Procedural History
- MeTC dismissed ejectment complaint for lack of valid demand, ruling Del Castillo lacked Board authority to issue demand.
- RTC reversed, finding demand valid as an act in the usual course of business and ratified by a May 13, 2008 Board resolution. It ordered respondent’s ejectment, payment of arrears, monthly compensation of ₱50,000, and attorney’s fees.
- CA reversed RTC, dismissing complaint for failure to attach the Board resolution to the pleading.
- Supreme Court granted petitioner’s Rule 45 petition.
Issues
- Whether the corporate president may sign verification and certify non-forum shopping absent express Board resolution.
- Whether the March 5, 2008 demand letter is valid without prior Board authorization.
- Whether all requisites for unlawful detainer were met.
- Proper amount of post-termination compensation and interest.
Authority to Verify and Certify
Under prevailing jurisprudence, a corporate president is presumed to have authority to sign verification and certification of non-forum shopping, even without express Board resolution. The CA erred in dismissing the complaint on this ground.
Validity of Demand Letter
The president’s issuance of a demand letter falls within his usual duties and general objectives of the corporation, as provided in Article IV, Section 2 of petitioner’s by-laws (supervision, execution of contracts, management of receivables). Any initial lack of Board authorization was cured by subsequent ratification through the May 13, 2008 Board resolution.
Unlawful Detainer Requisites
All elements are present:
- Existence of lease (express contract and assig
Case Syllabus (G.R. No. L-23771)
Factual Antecedents
- Petitioner, Colegio Medico-Farmaceutico de Filipinas, Inc., owns a building in Sampaloc, Manila.
- In June 2005, petitioner and respondent (as President/Officer-in-charge of St. John Berchman School of Manila Foundation) executed a one-year lease (June 2005–May 2006).
- After the lease expired, petitioner (through its then-President Dr. Virgilio C. Del Castillo) sent a proposed renewal for June 2006–May 2007, which respondent did not return.
- In December 2007, the Board decided not to renew the lease; on March 5, 2008, Del Castillo sent respondent a demand letter for P604,936.35 (back rentals and utilities) and to vacate by March 16, 2008, which respondent refused.
- Respondent asserted she succeeded to a ten-year lease (June 2003–May 2013) originally entered by St. John, claimed petitioner approved the assignment, and withheld rent due to unaddressed repair requests.
Ruling of the Metropolitan Trial Court
- Dismissed the ejectment complaint for lack of a valid demand letter.
- Held the March 5, 2008 demand letter to be “legally non-existent” because Del Castillo had no showing of board authorization.
- Emphasized that a written demand is a jurisdictional prerequisite in unlawful detainer cases.
Ruling of the Regional Trial Court
- Reversed the MeTC decision on May 13, 2010.
- Found the demand letter valid as an act done in the usual course of business by the corporate president.
- Noted that petitioner’s Board ratified Del Castillo’s acts via a May 13, 2008 resolution authorizing the filing of the case.
- Ordered respondent to vacate, pay P604,936.35, P50,000/month for use of the pro