GR 62603; (March, 1990) (Digest)
G.R. No. 62603 March 27, 1990
UNITED REALTY CORPORATION, petitioner, vs. HON. COURT OF APPEALS and REVEREND FATHER JOSE TORRALBA SY, respondents.
FACTS
Petitioner United Realty Corporation and private respondent Rev. Father Jose Torralba Sy entered into separate lease contracts for two apartments in Sampaloc, Manila, in 1964. The contracts stipulated a monthly rental and provided that the lease was for one month, “and so on from month to month,” terminable by either party giving five days’ written notice. Private respondent later combined the apartments, using them principally as a Buddhist chapel. In 1970, a third apartment was leased for residential use. In 1975, petitioner notified private respondent of a rental increase. Private respondent contested this, arguing the increase violated Presidential Decree No. 20, which froze rentals for certain dwelling units. Initial government opinions were conflicting, but a 1976 opinion from the Presidential Assistant for Legal Affairs concluded the premises, being used principally for worship, were not a “dwelling unit” covered by P.D. No. 20. Petitioner then demanded respondent vacate the premises. Upon refusal, petitioner filed an unlawful detainer case.
ISSUE
The primary issues are: (1) whether the lease contracts were for a definite or indefinite period, and (2) whether the premises are covered by the rental freeze under P.D. No. 20 and Batas Pambansa Blg. 25.
RULING
The Supreme Court ruled in favor of the petitioner, ordering the respondent to vacate the premises. On the first issue, the Court held the lease was for a definite period. The contract clause “for one month… and so on from month to month” establishes a lease for a fixed one-month period, renewable monthly. This creates a succession of definite periods, not an indefinite lease. A lease for a definite period is expressly excluded from the suspension of ejectment grounds under Section 4 of P.D. No. 20. Furthermore, under B.P. Blg. 25, expiration of a written lease contract is a ground for ejectment. Petitioner validly terminated the contract upon respondent’s refusal to pay the increased rental.
On the second issue, the Court found the premises were not covered by the protective laws. P.D. No. 20 and related statutes apply only to “dwelling units” used principally for residential purposes. The factual finding, which was not disputed, showed the leased apartments were used principally as a Buddhist temple. This principal use removes them from the definition of a dwelling unit, regardless of any incidental residential use by the respondent. Therefore, the rental freeze and restrictions on ejectment for dwelling units did not apply. The Court also noted that the lease agreements were effectively terminated by the death of the lessee, private respondent, during the pendency of the appeal.