G.R. No. 157568 - LEONARDO CHUA AND HEIRS OF YONG TIAN, VS. MUTYA B. VICTORIO, HEREIN REPRESENTED BY HER ATTORNEY-IN-FACT ARMANDO Z. COSME.D E C I S I O N - Supreme Court E-Library

Ruling

Accordingly, the MTCC quashed the writs of execution that it earlier issued. [11] Respondent assailed the quashal of the writ of execution directly to the Supreme Court via a petition for review on certiorari. This petition was dismissed by the Supreme Court on procedural grounds. [12] Petitioners thus remained in possession of respondents properties. Subsequently, on October 10, 1998, respondent wrote a letter to petitioners informing them of her intention to increase the monthly rentals effective November 1, 1998, from P6,551.25 per unit to a sum more than double that, namely, P15,000.00 per unit. [13] Petitioners refused to pay this amount, contending that it was beyond the allowable rental increase embodied in the compromise agreement. [14] Respondent thus instituted Civil Cases Nos. 21-2761 and 21-2762 seeking the ejectment of petitioners. In a joint decision dated May 10, 1999, the MTCC, Branch II, Santiago City dismissed these complaints for lack of merit. [15] On appeal, the RTC initially reversed the MTCC, [16] but later reversed its earlier decision. On March 9, 2000, the RTC issued an order affirming the MTCCs dismissal of the complaints. [17] Respondent filed a petition for review with the Court of Appeals, which was docketed as CA-G.R. SP No. 157568. On May 31, 2001, [18] the Court of Appeals reversed the March 9, 2000 Order of the RTC affirming the MTCCs dismissal of the complaints. The Court of Appeals ruled that the compromise agreement, which set a definite period of four years for the lease contract, had been abrogated by petitioners refusal to pay the increased rentals in 1994. Accordingly, in 1994, the juridical relation between the parties was severed. When respondent accepted payment of the increased monthly amount, an entirely new contract of lease was entered into between the parties. Since payment of rent was made on a monthly basis, and pursuant to Article 1687 of the Civil Code, the period of this lease contract was monthly. Upon the expiration of every month, the lessor could increase the rents and demand that the lessee vacate the premises upon non-compliance with increased terms. In exercise of equity, however, the Court of Appeals granted petitioners an extension of one year from finality of the decision within which to vacate the premises. Petitioners motion for reconsideration was denied on March 11, 2003. [19] Hence, this petition. The petition lacks merit. Petitioners case centers on the interpretation of the compromise agreement, which, they claim, continues to govern the juridical relation between the parties. Specifically, petitioners invoke the second clause of the compromise agreement, referring to the allowable increase in the rentals of respondents premises. Petitioners contend that that they have a continued right of occupancy, paying monthly rentals which may be increased only by 25% every four years. They argue that the increase demanded by respondent was in excess of the allowable amount, and,