SPOUSES OMAR & MOSHIERA LATIP v.

ROSALIE CHUA
GR No. 177809 16 October 16, 2009
By Kylie Dado

The Complaint by Rosalie (respondent):

Rosalie is the owner of Roferxane Building in Baclaran.

A year after the commencement of the lease, Rosalie, through counsel, sent the spouses a latter demanding
payment of back rentals and should they fail to do so to vacate the leased cubicles.

When spouses did not heed Rosalies demand, she filed a complaint for unlawful detainer + damages against them.
She attached to the complaint a contract of lease over 2 cubicles in Roferxane Bldg.

The Answer by Spouses Latip (petitioner):

The lease of the 2 cubicles had already been paid in full as evidenced by receipts showing payment to Rosalie of
the total amount of P2,570,000. There were 3 receipts in Rosalies handwriting.
1. P2M
2. P500K
3. P70K

Spouses also averred that sometime in October 1999, Rosalie offered for sale lease rights over 2 cubicles. Having in
mind the brisk sale of goods during the Christmas season, they readily accepted Rosalies offer to purchase lease
rights. The immediate payment of P2M+ would be used to finish construction of the building giving them first
priority in the occupation of the finished cubicles. And as soon as the 2 cubicles were finished, Spouses occupied
them.

Spouses averred that the contract of lease they signed had been novated by their purchase of lease rights of the
subject cubicles. Thus, they were surprised to receive a demand letter from Rosalies counsel.

METCs Ruling:

In favor of Rosalie. It ordered the spouses to vacate and pay rent arrearages, 10% increase in the rent, attys fees
and cost of suit.

RTCs Ruling:

Reversed MTCs ruling. Spouses Latio could not be ejected until the expiration of the lease period.

It did not give credence to the contract of lease since it was not notarized and incomplete, lacking:
1. Signature of Ferdinand, Rosalies husband
2. Signatures of Spouses Latip on the 1st page
3. Specific dates for the term of the contract
4. Exact date of execution of the document
5. Provision for payment of deposit or advance rental which is supposedly uncommon in big commercial lease
contracts

The entire lease rentals for the 2 cubicles for 6 years had already been paid in the amount of P2M+.

RTC shot down Rosalies claim that the P2M+ was simply goodwill payment by by prospective lessees to their
lessor, and not payment for the purchase of lease rights. The court said that apart from her bare allegations,
Rosalie did not adduce evidence to substantiate this claim.

CAs Ruling:

Reversed RTCs decision and reinstated METCs decision.

The alleged defects in the contract of lease did not render the contract ineffective.

On the issue of whether the amount of P2M+ merely constituted payment of goodwill money, the CA took judicial
notice of this common practice in the area of Baclaran, especially around the Redemptorist Church. According to
CA, this judicial notice was bolstered by the Joint Sworn Declaration of the stallholders at Roferxane Bldg. that they
all had paid goodwill money to Rosalie prior to occupying the stalls thereat.
Spouses Latip appealed.

ISSUE: Whether Spouses Latip should be ejected from the leased cubicles.

SC DECISION:

Spouses can be ejected since the lease ended in 2005 however, the amount of P2M+ must be
deducted from this liability of spouses to Rosalie.

Discussion:

Sections 1 and 2 of Rule 129 of the Rules of Court declare when the taking of judicial notice is mandatory or
discretionary on the courts, thus State Prosecutors v. Muro is instructive.

The power to take judicial notice is to be exercised by courts with caution; care must be taken that the requisite
notoriety exists; and every reasonable doubt on the subject should be promptly resolved in the negative.

Generally speaking, matters of judicial notice have three material requisites:

(1) the matter must be one of common and general knowledge;
(2) it must be well and authoritatively settled and not doubtful or uncertain; and
(3) it must be known to be within the limits of the jurisdiction of the court.

The principal guide in determining what facts may be assumed to be judicially known is that of notoriety. Hence, it
can be said that judicial notice is limited to facts evidenced by public records and facts of general notoriety.

To say that a court will take judicial notice of a fact is merely another way of saying that the usual form of evidence
will be dispensed with if knowledge of the fact can be otherwise acquired. This is because the court assumes that
the matter is so notorious that it will not be disputed. But judicial notice is not judicial knowledge. The mere
personal knowledge of the judge is not the judicial knowledge of the court, and he is not authorized to make his
individual knowledge of a fact, not generally or professionally known, the basis of his action.

Things of common knowledge, of which courts take judicial notice, may be matters coming to the knowledge of
men generally in the course of the ordinary experiences of life, or they may be matters, which are generally
accepted by mankind as true and are capable of ready and unquestioned demonstration.

A court cannot take judicial notice of any fact which, in part, is dependent on the existence or nonexistence of a
fact of which the court has no constructive knowledge.

Conclusion:

The matter which the CA judicial notice of does not meet the requisite of notoriety. Only CA took judicial
notice of this supposed practice to pay goodwill money to the lessor in the Baclaran area. Rosalie, apart from her
bare allegation, adduced no evidence to prove her claim that the amount of P2M+ simply constituted the payment
of goodwill money. Subsequently, Rosalie attached an annex to her petition for review before the CA, containing a
joint declaration under oath by other stallholders in Roferxane Bldg. that they had paid goodwill money to Rosalie
as their lessor.

The reason why our rules on evidence provide for matters that need not be proved under Rule 129, specifically on
judicial notice, is to dispense with the taking of the usual form of evidence on a certain matter so notoriously
known, it will not be disputed by the parties.

However, in this case, the requisite of notoriety is belied by the necessity of attaching documentary evidence, i.e.,
Joint Affidavit of the stallholders. In short, the alleged practice still had to be proven by Rosalie; contravening the
title itself of Rule 129 of the Rules of CourtWhat need not be proved.

xxx

On the issue of whether Spouses ought to be ejected, what remains in evidence is the contract of lease and the
receipts. SC ruled that the contract is complete. It need not be signed by the husband as he likewise did not sign
the other two receipts. Besides, it is undisputed that Rosalie owns and leases the stalls thus, doing away with the
need for her husbands consent.

On the conflicting interpretations by the lower courts of the receipts amounting to P2M+, SC held that there is
nothing on the receipts and on record that the payment and receipt referred to full payment of rentals for the whole
period of the lease. Thus, since the contract of lease remained operative, we find that Rosalies receipt of the
monies should be considered as advanced rentals on the leased cubicles. This conclusion is bolstered by the fact
that Rosalie demanded payment.