G.R. No. 148562, 25 November 2004, 444 SCRA 193


Petitioner Tagbilaran Integrated Settlers Association (TISA), is an organization founded in 1991 by individuals who have residential and business establishments in a commercial lot located at Torralba and Parras Streets in Tagbilaran City. The lot, which has an area of 2,726 square meters, is covered by TCT No. (142) 21047 in the name of respondent Tagbilaran Women’s Club (TWC). The latter entered into separate written lease contracts for a period of one year with individual petitioners herein, and the other petitioners as sublessees of stalls in the lot.

In a letter to petitioners, TWC demanded that they vacate the rented premises on the following grounds: expiration of lease contracts, non-payment of rentals, and violations of the conditions of lease including noncompliance with sanitary and building ordinances. Another letter of demand was sent to petitioners who refused to vacate the premises, however.

Later, TWC entered into a lease contract on the lot with one Lambert Lim who at once paid a total of P240,000.00 representing payment of rentals for the first twelve (12) months. Petitioners nevertheless refused to vacate the lot, they contending that the contract of lease between TWC and Lambert Lim is null and void because TWC impliedly extended to them new contracts of lease when it continued collecting monthly rentals from them.


1. Whether implied new lease contracts existed which justify petitioners’ continued occupation of the lot; and
2. Whether TWC violated its obligation under Article 1654 (c) of the Civil Code when it entered into a lease contract with Lim


While no subsequent lease contracts extending the duration of the original lease were forged, it appears that TWC allowed petitioners to continue occupying the lot as in fact it continued to demand, collect and accept monthly rentals. An implied new lease (tacita reconduccion) was thus created pursuant to Article 1670 of the New Civil Code which provides:

If at the end of the contract the lessee should continue enjoying the thing leased for fifteen days with the acquiescence of the lessor, and unless a notice to the contrary by either party has previously been given, it is understood that there is an implied new lease, not for the period of the original contract, but for the time established in Articles 1682 and 1687. The other terms of the original contract shall be revived.

Since the period for the tacita reconduccion was not fixed and the rentals were paid on a monthly basis, the contract was from month-to-month. A month-to-month lease under Article 1687 is a lease with a definite period, hence, it is terminable at the end of each month upon demand to vacate by the lessor.

When notice to vacate dated January 6, 1990 was sent by TWC to petitioners, followed by another dated July 16, 1990, the tacita reconduccion was aborted. For a notice to vacate constitutes an express act on the part of the lessor that it no longer consents to the continued occupation by the lessees of its property. The notice required [under Article 1670] is the one given after the expiration of the lease period for the purpose of aborting an implied renewal of the lease.

As thus correctly found by the Court of Appeals: “[t]he implied lease of appellants expired upon demand made by the appellee TWC on January 1990. From then on appellee TWC had the right to terminate the lease at the end of the term of the impliedly renewed contracts whose expiration dates w[ere] at the end of the month of January 1990. Although appellants continued to pay rent[al]s after said date, it is clear that they no longer have the right to continue in the possession of the subject lot because their continued stay therein was without the consent of appellee TWC.”

As for petitioners’ contention that TWC violated Article 1654 (c) of the Civil Code when it entered into a lease contract with Lim on February 25, 1993 without their previous consent, the same does not lie. For after TWC notified petitioners, by letter of January 6, 1990, to vacate the occupied premises, the implied new lease had been aborted and they, therefore, had no right to continue occupying the lot. Their continued occupation of the premises had thus become unlawful.

While TWC as a lessor is obliged to, under Article 1654 of the Civil Code, maintain the lessee in the peaceful and adequate enjoyment of the lease, the obligation persist only for the duration of the contract.

*Case digest by Meriam Rika R. Wong, JD – 4, Andres Bonifacio College, SY 2019-2020