Case Summary (G.R. No. L-3435)
Applicable Law and Lease Terms
This case arises under the provisions of the Civil Code of the Philippines pertaining to lease agreements. The lease initially commenced on August 1, 1971, granting Anson a two-year period for the rental of a specified area within the Makati Arcade for a monthly fee of P18,842. Upon termination of the lease, Anson continued to occupy the premises on a month-to-month basis, with the monthly rental increasing to P34,622.00.
Background of the Dispute
After Anson remained in possession beyond the agreed lease period, Shoemart issued a notice of termination on August 1, 1977, requiring Anson to vacate by August 31, 1977. When Anson failed to vacate, Shoemart filed an ejectment suit in the Municipal Court of Makati. Anson countered that the lease was ambiguous regarding the duration and asserted defenses grounded upon provisions of the Civil Code regarding leases.
Court Proceedings and Judgments
The Municipal Trial Court dismissed the claim in favor of Anson, which prompted Shoemart to appeal. The Regional Trial Court of Makati reversed this decision on October 2, 1987, ordering Anson to vacate the premises and awarding damages. A subsequent amendment on November 10, 1987, adjusted the award for damages, taking into account increased rental rates from 1980 to 1987.
Court of Appeals Decision
In a later judgment dated November 2, 1988, the Court of Appeals upheld the decision to eject Anson from the premises but modified the damages awarded, significantly reducing the monthly rental compensation and excluding certain claims for reimbursement of electricity consumption, leading to the present petition for review by Shoemart.
Legal Arguments and Issues Raised
Petitioner Shoemart presented three primary assignments of error:
- The Court of Appeals improperly limited the rental compensation to P45,142.00 per month, despite evidence of four rental increases during the unlawful detainer period.
- The Court erred in removing the one percent interest on unpaid damages effective October 1, 1977.
- The exclusion of electricity cost reimbursement from the damages awarded was inappropriate.
Evidence of Rental Increases
In its defense, Anson argued that the claim for increased rentals was barred by various legal doctrines, including estoppel and laches. However, Shoemart countered that evidence presented during trial supported the existence of additional rental increases, which were not objected to by Anson and thus could be considered as properly raised. The original complaint included a general request for "all other rentals and charges that may be due,” thereby preserving the right to seek higher amounts than those stated in the supplemental complaint.
Findings on Interest and Other Damages
Regarding the issue of interest, the Court established that since the o
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Case Overview
- Court: Supreme Court of the Philippines
- Decision Date: October 1, 1990
- G.R. No.: 86956
- Division: Third Division
- Petitioner: Shoemart, Inc.
- Respondents: The Honorable Court of Appeals and Anson Emporium Corporation
Background of the Case
- Lease Agreement: On August 1, 1971, Anson Emporium Corporation (Anson) leased a portion of the Makati Arcade from Shoemart, Inc. (Shoemart) for two years at a monthly rental of P18,842.00.
- Lease Terms: The lease stipulation included a provision for a month-to-month tenancy after the lease term unless otherwise agreed in writing.
- Post-Lease Possession: Anson continued to occupy the premises after the lease expired, paying an increased rental of P34,622.00.
- Termination of Lease: On August 1, 1977, Shoemart terminated the lease and demanded that Anson vacate by August 31, 1977. Anson failed to vacate, leading Shoemart to file an ejectment complaint.
Defenses Raised by Anson
- True Intent of Lease: Anson contended that the lease did not reflect the actual agreement, alleging a guarantee for occupancy of 24 years.
- Ejectment Challenge: Anson argued that even if the lease was expired, it could not be ejected without a longer-term lease fixed in accordance with the Civil Code (Articles 1673 and 1687).
Trial Court Proceedings
- Initial Decision: The Metropolitan Trial Court ruled in favor of Anson, dismissing the ejectment complaint on January 2, 1987.
- Appeal: Shoemart appealed to the Regional Trial Court of Makati, which reversed the lower court’s decision on October 2, 1987, ordering Anson to vacate and pay damages.