Case Summary (G.R. No. 166715)
Contract of Lease Details
The dispute arises from a Contract of Lease entered into on September 15, 1980, stipulating that the leased area was 896 square meters. The contract included terms related to the lease duration of twenty-five years and the initial rental rate of P0.15 per square meter, with provisions for renegotiation of the rental every five years based on land value trends.
Dispute on Lease Area and Rental
The conflict began in August 1985 when Montalbo requested a rental increase to P2.50 per square meter. Dolomite Mining Corporation only offered a 25% increase from the current rent. When negotiations failed, Montalbo filed a complaint before the Regional Trial Court, claiming the actual leased area was 1,206 square meters and requesting an increase in rent, along with moral damages and attorney's fees.
Trial Court Ruling
The Regional Trial Court ruled in favor of Dolomite Mining Corporation, reaffirming the leased area as 896 square meters based on the contract's terms, invoking the Parol Evidence Rule. The court adjusted the rental to P1.20 per square meter, totaling P1,032 annually for the period from 1985 to 1990. It granted Montalbo P5,000 for attorney's fees and P2,000 for litigation expenses.
Court of Appeals Decision
The Court of Appeals modified the trial court's ruling, determining the leased land's area to be 1,206 square meters based on Montalbo's documentation, primarily tax declarations. It established the new annual rental from 1985 to 1990 at P1.20 per square meter, amounting to P1,447.20, and upheld the award of attorney's fees and litigation expenses.
Key Issues on Appeal
In its petition to the Supreme Court, Dolomite Mining Corporation contested the Court of Appeals’ findings on the actual area leased, the annual rental, and the entitlement to attorney's fees and litigation costs. The petitioner argued that the evidence presented supported the contracted area of 896 square meters and that the respondent should be estopped from claiming otherwise.
Factual Determination and Evidence
The Supreme Court found that the issue of land area was factual and predominantly reliant on definitive surveys, which Dolomite Mining Corporation failed to present. The Court noted that the company's self-serving evidence did not convincingly demonstrate that only 896 square meters were leased. In contrast, the respondent’s tax declarations and other documentation supported her claim of a larger area.
Rationale for Rental Adjustment
The Court concurred with the Court of Appeals regardi
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Case Overview
- Court: Supreme Court of the Philippines
- Division: Second Division
- G.R. No.: 98451
- Date of Decision: January 28, 1993
- Petitioner: Dolomite Mining Corporation
- Respondents: Dionisia Montalbo and the Court of Appeals
Background of the Case
- Contract of Lease: On September 15, 1980, Dolomite Mining Corporation (petitioner) entered into a lease agreement with Dionisia Montalbo (private respondent) for a parcel of land specified to be 896 square meters.
- Lease Provisions:
- The lease was for 25 years and included a rental rate of P0.15 per square meter, with provisions for renegotiation every five years based on land value trends.
- Rent Increase Proposal: In August 1985, Montalbo sought an increase to P2.50 per square meter, while Dolomite Mining Corporation was only willing to pay 25% more than the previous rate.
Legal Proceedings
- Civil Case No. CEB-4282: Montalbo filed a complaint in the Regional Trial Court asserting that the leased land actually measured 1,206 square meters and sought to adjust the rent and claim damages, including attorney's fees and litigation expenses.
- Trial Court Ruling: The trial court ruled in favor of Dolomite Mining Corporation, affirming the original contract area of 896 square meters and denying Montalbo's claims for increased rent and damages, citing the Parol Evidence Rule.
Court of Appeals Decision
- Appeal by Both Parties: Both parties appealed the trial court's decision.
- Ruling of the Court of Appeals: The appellate court determined that the actual leased area