G.R. No.

83414 July 31, 1989

TONY CAUDAL, petitioner,
vs.
HON. COURT OF APPEALS, HON. REMEGIO E. ZARI, PRESIDING JUDGE,
REGIONAL TRIAL COURT, NATIONAL CAPITAL JUDICIAL REGION, Branch 98,
QUEZON CITY, and DIONISIO O. CU, respondents.

FACTS:
Private respondent Dionisio Cu and family rented first an apartment at No.
269-A D. Tuason, Quezon City but later transferred to No. 38 Silencio St., Santol, Quezon City
because the owner of the former apartment needed it for his personal use. The period of lease of
the second apartment was from 16 September 1984 up to 16 March 1986.

In February 1984, Cu in his desire to provide his family with a permanent abode acquired a parcel
of land situated at 157 E. Garcia, Quezon City, together with the existing improvements thereon,
consisting of a six (6) door apartment building from Julieta Esguerra. 2

On 2 July 1984, Cu notified petitioner who was then occupying one of the units therein, of the
termination of the lease contract by giving him until October 1984 within which to vacate the
premises. Yet despite the demand, petitioner refused to comply by remaining in the premises even
3

after October 1984, thereby compelling Cu to bring the matter to the office of the Barangay
Captain who issued a certification to file a complaint.

Dionisio Cu filed an ejectment case against

petitioner herein Tony Caudal. Cu alleged that he and his family were residing at 38 Silencio St.,
Santol, Quezon City merely as tenants; that neither plaintiff nor any member of his family was owner
of a house or dwelling unit in Quezon City or Manila, except a, six (6) door apartment located at 157
E. Garcia St., Cubao, Quezon City; that one of the apartment units was being leased to Caudal on
a monthly basis; that plaintiff and his family were transferring to the six (6) door apartment, two
(2) of which would be merged into one dwelling unit for his son Selwyn, who planned to get
married, and the remaining apartment units would be utilized as conjugal home of plaintiff and his
family.

Defendant alleged that he had a verbal contract with the owner Julieta B. Esguerra
on the subject premises at the monthly rate of P150.00 since July 1967; that Mrs. Esguerra failed
to claim the rental for November 1984 causing the defendant to deposit the same in a bank; that as
the subject parcel of land had an area of 1,000 sq. m. more or less he proposed that the 600 sq. m.
fronting the 6 door apartment be used for the construction of plaintiffs dwelling.

the Metropolitan Trial Court on 26 March 1986 rendered a

decision dismissing the complaint of the plaintiff. On 6 June 1986, the RTC of Quezon City reversed
the decision of the inferior court. Its decision
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in favor of Cu was based mainly on the latter's right to possess the said property after Cu had
bought the 6 door apartment from vendor Esguerra.

ISSUE:
Whether or not the RTC committed a grave abuse of discretion when it
ruled in favor of Cu despite the latter's intention of merely using (1) door as stock room, office,
quarter for maids and drivers.

HELD:
WHEREFORE, the decision of the Court of Appeals dated 29 January 1988 is hereby affirmed.
RATIONALE:

As to the proviso under the same section of B.P. 877 that the lease for a definite period has
expired, there is no question that under existing jurisprudence, the verbal contract of lease between
the original owner and the lessee on a month-to-month basis is a lease with a definite
period, which has expired upon Cu's notice given to Caudal on July 2, 1984, that the lease
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contract has been terminated; and that Caudal had until October 1984 or a period of three (3)
months within which to vacate the premises. In fact, this Court has clearly ruled that an oral month
to month lease is terminable on a 30 days' notice.

Cu himself was in dire need of a place to stay since he too was

just renting an apartment at 38 Silencio St., Santol, Quezon City and had to transfer in view of the
imminent expiration of his lease on 16 March 1986. Indeed, there was a need to find a place he
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could call his own.