Title
De Guzman vs. Court of Appeals
Case
G.R. No. 83959
Decision Date
Apr 8, 1991
Tenant disputes lease termination, non-payment of rent, and jurisdiction in ejectment case; court affirms eviction, deletes damages.
leased premises
legal battle
doctrine of litis pendencia

Case Summary (G.R. No. 83959)

Factual Background

Petitioner was the tenant of the late Teodora Villarama over a rice mill and a warehouse located in Angat, Bulacan. After the written lease contract expired on April 29, 1975, private respondent allegedly took over management and the parties allegedly agreed orally that the lease would be month-to-month. Petitioner continued to occupy the premises but failed to pay monthly rentals for May and June, 1977.

Private respondent notified petitioner of termination and demanded return of the premises. Because petitioner failed to comply, private respondent filed an ejectment case against him before the Municipal Trial Court of Angat, Bulacan as Civil Case No. 183. On June 29, 1978, the trial court ruled for private respondent, and on December 28, 1978, it declared the decision final and executory.

On June 29, 1979, petitioner filed with the Court of First Instance (later the Regional Trial Court) a petition for relief from judgment with prayer for preliminary injunction to restrain enforcement of the writ of execution. On the scheduled date for the issuance of a writ of preliminary injunction, petitioner filed another pleading in the same court—a petition for certiorari, prohibition and mandamus with restraining order, injunction, and damages—docketed as Special Civil Action SM-960, seeking to restrain the enforcement of the execution. Pending resolution, the court issued a restraining order, required petitioner to post an injunction bond, and ordered deposit of rentals.

Acting on SM-960, the Regional Trial Court declared the proceedings in Civil Case No. 183 null and void for lack of the jurisdictional demand required by Section 2, Rule 70 and ordered dismissal of that case.

Afterward, private respondent filed a second ejectment case against petitioner before the Municipal Trial Court as Civil Case No. 286. In a decision dated October 16, 1984, the trial court ordered petitioner to vacate, ordered payment of monthly rentals of P175.00 from May 1977 until petitioner vacated with 14% interest per annum until fully paid, and awarded moral damages (P10,000.00), exemplary damages (P5,000.00), attorney’s fees (P5,000.00), and costs.

Trial Court Proceedings in SM-960 and Civil Case No. 286

After the decision in Civil Case No. 286, petitioner filed in SM-960 (now reassigned to Regional Trial Court, Branch 16 after reorganization) a petition for contempt with restraining order and injunction to prevent execution. The Regional Trial Court treated the filing as a petition for certiorari, prohibition, and restraining order with damages, and on the same date issued an order restraining execution.

Petitioner also appealed the October 16, 1984 decision in Civil Case No. 286, which was raffled to the same Regional Trial Court branch presided by then Judge Gualberto dela Llana. On April 11, 1986, the Regional Trial Court sustained the Municipal Trial Court.

After denial of petitioner’s motion for reconsideration, petitioner filed with the Court of Appeals a petition for certiorari, prohibition and mandamus, alleging grave abuse of discretion amounting to lack or excess of jurisdiction, and asserting that Civil Case No. 286 should have been dismissed on grounds of lack of jurisdiction, litis pendencia, and lack of cause of action.

The Court of Appeals Ruling

In its decision dated May 11, 1988, the Court of Appeals dismissed the petition for lack of merit. It held that the decision of the Regional Trial Court in SM-960 was not an adjudication on the merits because the dismissal of Civil Case No. 183 resulted from lack of the jurisdictional demand under Section 2, Rule 70. It further ruled that the defense of litis pendencia could not bar the second ejectment case because, for litis pendencia to apply, the first case’s court must have had jurisdiction over the subject matter, and the first case had been dismissed due to lack of jurisdiction.

The Court of Appeals also found that the written lease contract had not been renewed through the death of Teodora Villarama, and hence it automatically expired at the end of the period covered without need of demand. It added that petitioner failed to establish his right to continued possession, considering that private respondent held title over the premises under TCT No. 178491, issued on February 9, 1973.

Petitioner’s Position Before the Supreme Court

Petitioner again argued that the second ejectment judgment, affirmed by the Regional Trial Court and the Court of Appeals, was issued without or in excess of jurisdiction. He asserted that the premises and the deposited rentals were the same matters pending in SM-960 before the Regional Trial Court, Branch 16, and that motions of private respondent for delivery of deposited rentals had been denied therein. On this premise, petitioner claimed the Municipal Trial Court lacked authority to pre-empt the Regional Trial Court’s disposition of those matters.

He also argued that private respondent had no cause of action because the lease contract had been between petitioner and Teodora Villarama. In addition, petitioner claimed the Regional Trial Court lacked jurisdiction over the appeal because petitioner allegedly abandoned it after failing to annul the second ejectment decision through the issuance of a restraining order. He maintained that his appeal had been assigned to Regional Trial Court Branch X, but was consolidated with SM-960 without an approved consolidation order, and was decided without notice for oral arguments or submission of memoranda. Finally, petitioner assailed the awards as improper, arguing that the judgment required him to pay double rent and rent from 1980, and that the moral and exemplary damages and attorney’s fees were contrary to jurisprudence.

The Court’s Reasoning

The Court held that petitioner’s jurisdictional argument did not accurately characterize SM-960. It treated SM-960 as an independent special civil action brought to annul or modify the proceedings in the first ejectment case and to restrain enforcement of the writ of execution on the ground that the Municipal Trial Court had acted without or in excess of jurisdiction or with grave abuse of discretion. The Court emphasized that the dismissal of the first ejectment case in SM-960 could not be pleaded as a bar to the second ejectment case because the dismissal in SM-960 was grounded on non-compliance with the jurisdictional demand requirement under Section 2, Rule 70.

The Court also rejected petitioner’s contention that the disposition of rentals in SM-960 deprived other courts of authority. It reasoned that petitioner’s undertaking in SM-960 regarding the deposited rentals was distinct and separable from the issues involved in the ejectment suit. Because SM-960 had already terminated, the Court ruled that litis pendencia could no longer be invoked.

On the alleged lack of cause of action due to privity issues, the Court held that private respondent had a sufficient legal basis arising from his ownership. Private respondent held absolute title over the premises under TCT No. 178491. Consequently, the essential elements of a valid cause of action existed: private respondent’s right to demand payment of rent for use and occupation; petitioner’s correlative obligation to pay; and petitioner’s refusal to pay and failure to vacate.

The Court further dismissed petitioner’s claim of good faith and entitlement to an honorarium under negotiorum gestio, concluding that sustaining such a theory would lead to an anomalous and absurd result: petitioner would continue occupying and enjoying the leased premises while simultaneously receiving payment. It also rejected petitioner’s procedural complaints regarding jurisdiction and consolidation. The Court considered petitioner’s position inconsistent and characterized the filing in SM-960 as an ineffective remedy to delay the effects of the second ejectment decision since SM-960 had alre

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