G.R. No. 136913, 12 May 2000
Petitioner Anita Buce leased a 56 square meter of land located at Quirino Avenue, Pandacan, Manila. The lease was for a period of 15 years to commence on June 1, 1979 and subject to renewal for another 10 years, under the same terms and conditions. Respondent Jose Tiongco, demanded a gradual increase in the rent for Php 1,000 on 1991. On December 1991, respondent wrote petitioner informing the increase of rent pursuant to the Rent Control Law, effective on January 1992. However, petitioner tendered checks dated October 1991 to January 1993 for only Php 400 payable to respondent as administrator which the latter refused to accept. Petitioner filed a complaint for specific performance which the trial court ruled in favor of petitioner. Appellate court reversed the decision.
Whether or Not the period of lease is to renew the contract be given to the lessor.
Yes. In the given case of contract of lease, it is given to the lessor. As a general rule under Article 1196 of the Civil Code, the period of the lease contract is deemed to have been set for the benefit of both parties. Renewal of the contract may be had only upon their mutual agreement or at the will of both of them. In the given case, “this lease shall be for a period of fifteen years effective June 1, 1979, subject to renewal for another ten (10) years, under the same terms and conditions” does not mean an autmoctic extension of the contract. The fact that the lessee was allowed to introduce improvements on the property is not indicative of the intention of the lessors to automatically extend the contract. However, in the given case, Tionco were not amenable to a renewal, they cannot be compelled to execute a new contract when the old contract terminated on 1 June 1994. It is the owner-lessors prerogative to terminate the lease at its expiration. The fulfillment of a contract of lease cannot be made to depend exclusively upon the free and uncontrolled choice of the lessee and completely depriving the owner of any say in the matter. Mutuality does not obtain in such a contract of lease and no equality exists between the lessor and the lessee since the life of the contract would be dictated solely by the lessee.
* Case digest by Neah Hope L. Bato, LLB-1, Andres Bonifacio Law School, SY 2017-2018