Spouses Galang vs. Court of Appeals and De Leon

The Court of Appeals may dismiss a petition for review of an RTC decision in a case falling under the original exclusive jurisdiction of municipal and city courts when the petitioner fails to deposit the required costs within three days from notice of the resolution giving due course, as mandated by the Court of Appeals' August 12, 1971 en banc Resolution adopted by the Interim Rules; such dismissal is not grave abuse of discretion. Ejectment also lies under Section 5(c) of Batas Pambansa Blg. 25 where the owner/lessor legitimately needs the premises for an immediate family member, and a month-to-month lease is a lease with a definite period that may be terminated after proper notice or demand.

Leonardo de Leon owned a 6-door apartment at 1177 Quiricada Extension, Tondo, Manila, one unit of which was leased by spouses Ruben and Luz Galang. The dispute implicated Section 5(c) of Batas Pambansa Blg. 25, which permits ejectment where the owner/lessor needs the property for the use of an immediate family member, and the Court of Appeals' August 12, 1971 en banc Resolution, adopted by the Interim or Transitory Rules Relative to the Implementation of the Judiciary Reorganization Act of 1981, which governed petitions for review of RTC decisions in cases falling under the original exclusive jurisdiction of municipal and city courts.

Leonardo de Leon owned a 6-door apartment at 1177 Quiricada Extension, Tondo, Manila. Spouses Ruben and Luz Galang leased one of its units under a month-to-month arrangement. De Leon's sister, Consuelo De Leon, was staying with their parents in a rented apartment of only about 48 square meters at 1111 Quiricada Extension, Tondo, Manila, and de Leon was the one paying their monthly rentals.

On June 7, 1985, de Leon demanded that petitioners vacate the premises by September 15, 1985. The demand was made because de Leon intended to use the questioned premises for his parents and sister. Petitioners did not vacate. On October 7, 1985, after more than three months from receipt of the notice, de Leon filed the ejectment case.

The trial court resolved the factual question of whether the requisites of Section 5(c) of Batas Pambansa Blg. 25 were present. The record showed that de Leon's sister Consuelo was staying with their parents in a rented apartment of only about 48 square meters at 1111 Quiricada Extension, Tondo, Manila; that de Leon was paying their monthly rentals; and that it was not clearly proven that de Leon owned any other property in Manila. The lease was on a month-to-month basis.

• No Rule Requiring Three-Day Payment: Petitioners argued that nothing in the Rules of Court governing procedure in the Court of Appeals, specifically Rules 46 to 55, requires payment of costs within three days from notice of the order.
• Three-Day Period Too Short / Lack of Personal Notice: Petitioners maintained that three days from notice is too short for counsel to contact petitioners, who were not themselves furnished a copy of the September 1, 1986 resolution.
• Ten-Day Period Under the Rules, BP 129, and Interim Rules: Petitioners claimed that under the Rules of Court, Batas Pambansa Blg. 129, and the Interim Rules and Guidelines, ten days is the shortest period within which a party-litigant in the Court of Appeals should perform a required act.
• Grave Abuse of Discretion: Petitioners imputed error and grave abuse of discretion on the Court of Appeals in dismissing the petition for review for non-payment of P80.40 costs within three days from notice and in denying the motion for extension of time to pay costs for being filed one day late.
• Motion for Reconsideration Ground: Petitioners contended in their motion for reconsideration that their counsel was not able to notify them of the order to pay costs within three days from September 5, 1986.

• Procedural Dismissal: Whether the Court of Appeals gravely abused its discretion in dismissing the petition for review for failure to deposit P80.40 costs within three days from notice and in denying the motion for extension of time to pay costs for being filed one day late.
• Liberal Application of Rules: Whether the procedural rule should be relaxed to allow petitioners' late payment of costs and permit resolution of the case on the merits.
• Ejectment Under BP 25: Whether the ejectment of petitioners is proper under Section 5(c) of Batas Pambansa Blg. 25.

• Procedural Dismissal: No. The Court of Appeals acted pursuant to its August 12, 1971 en banc Resolution, adopted by the Interim Rules, which required deposit of P80.40 costs within three days from notice and mandated dismissal upon failure to comply.
• Liberal Application of Rules: No. Petitioners failed to show the most persuasive reasons required to relax procedural rules; the motion for extension was late, and even the later payment was late.
• Ejectment Under BP 25: Yes. The legitimate need of the owner/lessor to repossess the property for use of an immediate family member is a valid ground under Section 5(c) of Batas Pambansa Blg. 25.

• Procedural Dismissal: The Court of Appeals, pursuant to its rule-making power under Rule 54 of the Rules of Court, promulgated an en banc Resolution on August 12, 1971 governing the practice in elevating to the Court of Appeals for review decisions of CFIs (now RTCs) in cases falling under the original exclusive jurisdiction of municipal and city courts. Section 2 of that Resolution provided that upon filing of the petition, the petitioner shall pay the docketing fee; if the Court finds the petition not prima facie meritorious or manifestly intended for delay, it may outright dismiss; otherwise, the petition shall be given due course, in which case the petitioner shall deposit P80.00 for costs within three days from notice of the resolution giving due course, and upon failure to deposit the amount within that period, the petition shall be dismissed. Section 22, paragraph (2), of the Interim or Transitory Rules and Guidelines Relative to the Implementation of the Judiciary Reorganization Act of 1981 adopted the August 12, 1971 Resolution as the governing rules of procedure in the review of appealed cases from the RTCs. Records showed that petitioners' counsel received the September 1, 1986 resolution on September 5, 1986; that on September 9, 1986, or one day after expiration of the three-day period, petitioners filed a motion for a 30-day extension of time to deposit costs; and that even if the extension were granted, the purchase and payment by petitioners of Money Order No. 6618804 on October 13, 1986 for costs was five days late from the expiration of the supposed 30-day extension on October 8, 1986. There was thus no serious intention on the part of petitioners to comply in good faith with the Court of Appeals' order, and no grave abuse of discretion attended the dismissal.
• Liberal Application of Rules: Procedural rules are not to be belittled or dismissed simply because their non-observance may have resulted in prejudice to a party's substantive rights. Like all rules, they are required to be followed except only for the most persuasive of reasons, when they may be relaxed to relieve a litigant of an injustice not commensurate with the degree of his thoughtlessness in not complying with the prescribed procedure. Petitioners did not plead the most persuasive of reasons. While the case was on appeal before the RTC, petitioners ignored the RTC's order dated May 14, 1986 to file their memorandum within ten days from notice, and the case was decided on July 22, 1986 without their memorandum. Having already ignored an order of the RTC, petitioners could not be allowed a second defiance of procedural rules before the Court of Appeals. The reason that petitioners were not themselves furnished a copy of the September 1, 1986 resolution did not call for liberal application because notice to counsel is notice to the client. Under Section 2 of Rule 13 of the Rules of Court, if a party has appeared by an attorney, service upon the party shall be made upon the attorney unless service upon the party himself is ordered by the court, and no such order was given.
• Ejectment Under BP 25: Even if the deposit of costs were allowed on liberal grounds, the petition lacked merit. The legitimate need of the owner/lessor to repossess his property for use of any immediate member of his family is a valid ground to eject petitioners under Section 5, paragraph (c), of Batas Pambansa Blg. 25. The factual question of whether all the requisites under that provision were present was properly addressed and resolved by the trial court. Records showed that private respondent's sister Consuelo De Leon was staying with their parents in a rented apartment of only about 48 square meters at 1111 Quiricada Extension, Tondo, Manila. The intended use of the questioned premises by de Leon's parents and sister was a legitimate need under Section 5(c) of B.P. 25 because de Leon was the one paying their monthly rentals. De Leon's desire to repossess the premises to provide his parents and sister with a decent place to stay must be given traditional respect and recognition, and it was not clearly proven that he owned any other property in Manila. It is settled that a lease on a month-to-month basis is a lease contract with a definite period. As ruled in Baens vs. Court of Appeals, even if the month-to-month arrangement is verbal, if it is shown that the lessor needs the property for his own use or for the use of any immediate member of the family or for any of the other statutory grounds to eject under Section 5 of Batas Pambansa Blg. 25, the lease is considered terminated as of the end of the month, after proper notice or demand to vacate has been given. As early as June 7, 1985, private respondent had demanded that petitioners vacate the premises on September 15, 1985, and the ejectment case was filed on October 7, 1985 after a lapse of more than three months from receipt of said notice. While the Court sympathized with the lessees who faced displacement and relocation, the law is on the side of the lessors and must be upheld; social justice is for fairness to all.

• Procedural Rules Must Be Followed; Liberal Construction Only for Most Persuasive Reasons — Rules of procedure ensure the orderly administration of justice and the protection of substantive rights in judicial and extrajudicial proceedings. They are not to be belittled or dismissed simply because their non-observance may have resulted in prejudice to a party's substantive rights; they must be followed except only for the most persuasive of reasons, when relaxed to relieve a litigant of an injustice not commensurate with the degree of his thoughtlessness in not complying. The Court applied this doctrine to uphold the Court of Appeals' dismissal of the petition for review for failure to deposit P80.40 costs within three days from notice, finding no persuasive reason to relax the rule.
• Notice to Counsel Is Notice to Client — Under Section 2 of Rule 13 of the Rules of Court, if a party has appeared by an attorney, service upon the party shall be made upon the attorney unless service upon the party himself is ordered by the court. The Court applied this doctrine to reject petitioners' argument that they were not furnished a copy of the September 1, 1986 resolution, because their counsel received it and no court order required personal service on petitioners.
• Ejectment for Legitimate Need of Immediate Family Under BP 25 — Section 5, paragraph (c), of Batas Pambansa Blg. 25 permits ejectment where the owner/lessor legitimately needs the property for the use of an immediate member of the family. The Court applied this doctrine because de Leon's parents and sister were staying in a rented apartment of about 48 square meters, de Leon was paying their monthly rentals, and it was not clearly proven that de Leon owned any other property in Manila.
• Month-to-Month Lease as a Lease with Definite Period; Termination Upon Demand — A lease on a month-to-month basis is a lease contract with a definite period. Even if the month-to-month arrangement is verbal, if the lessor needs the property for his own use or for the use of any immediate member of the family or for any of the other statutory grounds to eject under Section 5 of Batas Pambansa Blg. 25, the lease is considered terminated as of the end of the month after proper notice or demand to vacate. The Court applied this doctrine because de Leon demanded on June 7, 1985 that petitioners vacate by September 15, 1985, and the ejectment case was filed on October 7, 1985.

• "Procedural rules are not to be belittled or dismissed simply because their non-observance may have resulted in prejudice to a party's substantive rights. Like all rules, they are required to be followed except only for the most persuasive of reasons when they may be relaxed to relieve a litigant of an injustice not commensurate with the degree of his thoughtlessness in not complying with the procedure prescribed." — This passage states the ratio for refusing to relax the rules and upholding the dismissal of the petition for late payment of costs.
• "It is basic that notice to counsel is notice to the client. Under Section 2 of Rule 13 of the Rules of Court, if any of the parties in a case has appeared by an attorney or attorneys, service upon him shall be made upon his attorney or one of them, unless service upon the party himself is ordered by the court." — This passage defines the notice doctrine applied to reject petitioners' claim that they were not personally furnished a copy of the resolution.
• "The legitimate need of the owner/lessor to repossess his property for use of any immediate member of his family is a valid ground to eject petitioners from the questioned premises under Section 5 par. (c) of Batas Pambansa Blg. 25." — This passage states the substantive ground for ejectment upheld on the merits.
• "It is settled that a lease on a month to month basis is a lease contract with a definite period." — This passage states the rule on month-to-month leases that supported termination after proper demand.

• Limpot vs. Court of Appeals, 170 SCRA 367 (1989) — Cited for the rule that procedural rules are not to be belittled or dismissed and must be followed except for the most persuasive reasons; the Court quoted this case in rejecting petitioners' plea for liberal application.
• Baens vs. Court of Appeals, 125 SCRA 634 — Cited for the rule that even a verbal month-to-month arrangement is terminated at the end of the month when the lessor needs the property for his own use or for an immediate family member or for other statutory grounds under Section 5 of Batas Pambansa Blg. 25, after proper notice or demand.
• Rantael vs. Court of Appeals, 97 SCRA 453 — Cited for the settled rule that a lease on a month-to-month basis is a lease contract with a definite period.
• Crisostomo vs. Court of Appeals, 116 SCRA 199 — Cited in connection with the rule on termination of a month-to-month lease upon proper notice or demand under the statutory ejectment grounds.
• Pascua vs. Court of Appeals, 183 SCRA 262 (1990) — Cited for the observation that the law is on the side of the lessors and that social justice is fairness to all.

• Section 2, Court of Appeals en banc Resolution dated August 12, 1971 — Requires the petitioner to pay the docketing fee upon filing; if the petition is not prima facie meritorious or is manifestly intended for delay, the Court may outright dismiss it; otherwise, the petition is given due course, and the petitioner must deposit eighty pesos (P80.00) for costs within three days from notice, failing which the petition shall be dismissed. The Court applied this provision to uphold the dismissal for non-payment of P80.40 costs.
• Section 22, paragraph (2), Interim or Transitory Rules and Guidelines Relative to the Implementation of the Judiciary Reorganization Act of 1981 — Adopted the August 12, 1971 Court of Appeals Resolution as the governing rules of procedure in the review of appealed cases from the Regional Trial Courts. The Court applied this provision to confirm the applicability of the three-day cost-deposit rule.
• Section 2, Rule 13, Rules of Court — Provides that if a party has appeared by an attorney, service upon the party shall be made upon the attorney unless service upon the party himself is ordered by the court. The Court applied this provision to hold that notice to petitioners' counsel was notice to petitioners.
• Section 5, paragraph (c), Batas Pambansa Blg. 25 — Provides that the legitimate need of the owner/lessor to repossess the property for use of an immediate member of the family is a valid ground for ejectment. The Court applied this provision to uphold the ejectment on the merits.
• Rule 54, Rules of Court — Cited as the source of the Court of Appeals' rule-making power in promulgating the August 12, 1971 en banc Resolution. The Court applied it to establish the validity of the procedural rule invoked by the Court of Appeals.

Gutierrez, Jr., Feliciano, Bidin, and Davide, Jr., JJ., concurred.