Case Summary (G.R. No. L-27070-71)
Applicable Law
The pertinent law for this case revolves around the provisions of the 1987 Philippine Constitution and the Revised Rules of Court, specifically Rule 70 on Forcible Entry and Unlawful Detainer.
Background and Factual Antecedents
The Petitioner, Union Bank of the Philippines, acquired the properties through foreclosure after the Respondent failed to meet payment obligations outlined in a Contract to Sell, which involved a total payment of P12,208,633.57 due over seven years. The contract contained provisions stipulating that non-compliance would lead to automatic rescission and forfeiture of payments made. After the Respondent failed to adhere to the payment schedule, the Petitioner sent a demand letter for payment on December 10, 2003, followed by a demand to vacate on May 24, 2004.
Initial Rulings
The Municipal Trial Court in Cities (MTCC) dismissed the ejectment case on October 25, 2006, reasoning that the Petitioner did not establish jurisdiction as the case pertained to a rescission of contract rather than simple ejectment. The Regional Trial Court (RTC) upheld this decision on August 6, 2007, asserting that a legal demand for both payment and vacancy was necessary for jurisdiction.
Arguments Presented by the Petitioner
The Petitioner contended that once the Contract to Sell was rescinded due to non-payment, a demand to pay was no longer a prerequisite for filing an ejectment case. The Petitioner cited Union Bank of the Philippines v. Maunlad Homes, Inc., claiming that non-payment voided the contract thereby negating the Respondent's right to further occupy the property.
Response from the Respondent
The Respondent maintained that the absence of a demand to pay invalidated the MTCC’s jurisdiction over the ejectment case. It also argued that any non-payment issues should have been addressed through the proper legal procedures related to breach of contract rather than eviction.
Ruling of the Court of Appeals
The Court of Appeals, on July 31, 2012, upheld the dismissal, affirming that the jurisdictional requirement of making both a demand to pay and to vacate was not met. It concluded that since the demand to pay was absent, the lower courts lacked jurisdiction over the ejectment case.
Supreme Court's Ruling
The Supreme Court granted the Petition, stating that the definition of ejectment encompasses situations where possession is withheld after the termination of a contract, not solely
...continue readingCase Syllabus (G.R. No. L-27070-71)
Case Citation
- Jurisprudence: 789 Phil. 56
- G.R. No. 205951
- Decision Date: July 04, 2016
- Second Division
Background of the Case
- Petitioner: Union Bank of the Philippines (UBP)
- Respondent: Philippine Rabbit Bus Lines, Inc. (PRBL)
- Nature of the case: Ejectment
- Relevant Property: Two parcels of land totaling 1,181 square meters located in Poblacion, Alaminos, Pangasinan.
- Title: Covered by Transfer Certificates of Title Nos. 21895 and 21896.
Factual Antecedents
- UBP acquired the subject property through foreclosure from PRBL, which had previously owned the lots but continued to occupy them.
- On November 8, 2001, UBP and PRBL executed a Contract to Sell totaling P12,208,633.57, with payment due within seven years in quarterly installments.
- Terms of the contract included:
- Payments made without notice or demand.
- Failure to comply would result in forfeiture of installment payments as liquidated damages.
- PRBL failed to make payments as stipulated, leading UBP to issue a demand letter on December 10, 2003, to pay overdue amounts or face rescission of their contract.
Demand and Rescission Notices
- UBP's December 10, 2003 letter demanded payment of P9,940,197.36 within 30 days, or else the contract would be rescinded.
- UBP followed up with a May 24, 2004 letter demanding PRBL to vacate the property, citing failure to comply with the payment terms and subsequent rescission effective February 28, 2004.
- PRBL had issued three postdated checks amounting to P1.5 million, but only one check for P500,000 cleared.
Ejectment Proceedings
- On May 26, 2005, UBP filed an ejectment case against PRBL before the Municipal Trial Court in Cities (MTCC) of Alaminos (Civil Case No. 2171).
- UBP sought eviction and payment for rental arrears and monthly rent.
- PRBL conteste