Case Summary (G.R. No. 129609)
Factual Background
• 1972–1987: Republic and Rodil executed and renewed lease contracts (15 years in 1972; sublease to Association members from 1980).
• 1982: BP 233 authorized sale of former alien commercial properties; Rodil offered to purchase in 1987.
• 23 September 1987: Factora granted five-year lease renewal; DGSREPM later disapproved and directed Association occupancy pending appraisal.
• 6 October 1987: Rodil filed for specific performance, injunction, damages; trial court issued preliminary injunction; Court of Appeals affirmed.
• 18 May and 25 May 1992: Renewal and supplement contracts executed with DENR (Factoran, Palad), extending lease to 1997 with adjusted rentals; Office of the President later nullified these.
Procedural History
• 1987–1992: Multiple proceedings—specific performance and injunction (RTC Manila, CA), letter-appeal to President, actions for declaration of nullity, unlawful detainer suits at Metropolitan and Regional Trial Courts against sub-lessees.
• 1993–1996: RTC and MeTC decisions favored Rodil in unlawful detainer; CA, Special Fourth Division, reversed and dismissed; Second Division, in another CA decision, declared 1992 lease renewal void.
• 2001: Petitions for certiorari (Rule 45) consolidated before the Supreme Court (1987 Constitution governs).
Issues
- Validity of the 1987 and 1992 lease renewal contracts between Republic and Rodil
- Rodil’s entitlement to eject sub-lessees via unlawful detainer actions
- Dismissal of Association’s counterclaim for malicious prosecution
- Compliance with Rule 45 procedural requirements
Applicable Law
• 1987 Philippine Constitution – property rights; jus disponendi of owner
• BP 233 (1982) – sale of former alien commercial properties
• Civil Code (Arts. 1305, 1319, 1381, 1670; Rule 17, Rules of Civil Procedure) – contract validity, acceptance, rescission, counterclaim, renewal by implication
• Rule 45, Sec. 4, Rules of Court – petition requirements
Court’s Analysis
- Contract Formation and Validity
– 23 Sept 1987 renewal: no communicated approval to Rodil; thus no meeting of minds (Art. 1319). Void.
– 18 May and 25 May 1992 agreements: properly approved by DENR, not prohibited by law or policy, no infirmity in retroactive terms; presumption of validity stands. - Effect of Injunctions and Presidential Order
– TRO addressed only Association, not Rodil; execution of 1992 contracts preceded subsequent injunction, so not enjoined.
– Presidential nullification not binding on non-parties (Rodil). - Renewal vs. Novation
– Title “Renewal” does not import novation absent express incompatible terms; contract provisions extend original term, sustaining implied new lease (Art. 1670). - Action for Unlawful Detainer
– Owner’s right to eject unlawful occupants is distinct from physical prior possession; respondents’ occupancy was merely permissive under temporary permit; Rodil as lessee entitled to possession and to sue (Rule 70). - Counterclaim for Malicious Prosecution
– Elements absent: Rodil’s underlying actions not groundless or malicious; counterclaim prope
Case Syllabus (G.R. No. 129609)
Facts of the Case
- Rodil Enterprises, Inc. (RODIL) has been lessee of the Ides O’Racca Building since 1959, a former alien property later vested in the Republic under R.A. 477.
- In 1980, RODIL subleased portions of the building to members of the Ides O’Racca Building Tenants Association, Inc. (ASSOCIATION), namely Carmen Bondoc, Teresita Bondoc-Esto, Divisoria Footwear, and Chua Huay Soon.
- The primary lease with the Republic was renewed on 4 September 1972 for fifteen years, under the administration of the Building Services and Real Property Management Office (BSRPMO).
- B.P. 233 (12 September 1982) authorized sale of former alien commercial properties; RODIL’s application to purchase was pending appraisal.
- On 23 September 1987, Director Factora of BSRPMO granted RODIL a five-year lease renewal pending purchase appraisal; this renewal was later disapproved by Secretary De Jesus on 30 September 1987 in favor of the ASSOCIATION, recalling prior approvals.
- RODIL filed for specific performance with damages and injunctive relief (Civil Case No. 87-42323), obtaining a preliminary injunction on 26 October 1987; the Court of Appeals affirmed and required deposit of rentals pendente lite.
- Director Abelardo Palad, Jr. was designated custodian of former alien properties in May 1988; RODIL then signed a ten-year renewal on 18 May 1992 (effective 1 September 1987), supplemented on 25 May 1992 with adjusted rentals.
- The ASSOCIATION and sublessees (spouses Alvarez) contested the 1992 contracts via petition and administrative appeal; the renewal was ultimately nullified by the Executive Secretary on 8 February 1994.
- RODIL pursued multiple unlawful detainer actions (1993–1994) against Bondoc, Bondoc-Esto, Divisoria Footwear, and Chua; the Metropolitan Trial Court rendered judgment for ejectment and arrearages, affirmed by the Regional Trial Court.
- The ASSOCIATION and Chua appealed to the Court of Appeals, which on 12 April and 29 November 1996 annulled the 1992 renewal and dismissed RODIL’s detainer actions; RODIL sought review under Rule 45 (G.R. Nos. 129609 & 135537).
Procedural History
- 1987: RODIL’s suit for specific performance and injunction (RTC Manila Br. 8) granted preliminary injunction.
- 1988–1992: Administrative developments and 1992 lease renewals executed and