Philippine National Construction Corporation v. Court of Appeals

Summary

PNCC entered a 5-year lease with the Raymundo family for land to establish a rock crushing plant, with rental commencing upon issuance of industrial clearance. After obtaining a Temporary Use Permit, PNCC acknowledged rental obligations but later sought contract termination citing financial and technical difficulties, refusing to pay the agreed P240,000 annual rental. The Supreme Court affirmed lower courts' decisions ordering PNCC to pay P492,000 (two years rental) plus damages. The Court held PNCC was estopped from denying the permit constituted the required clearance, that financial difficulties and political changes did not constitute legal impossibility justifying contract termination, and that PNCC received adequate due process despite counsel's repeated absences. The decision reinforces the binding nature of contracts and the limited circumstances under which parties may be released from contractual obligations.