Philippine Fisheries Development Authority v. Court of Appeals

Summary

This case involves a lease contract dispute between PFDA and QVEGG over the Iloilo Fishing Port Complex. After QVEGG became delinquent, PFDA granted a restructuring agreement but later terminated the lease for non-compliance with new terms. The core issue was whether PFDA's termination was valid or whether the original contract's two-month grace period still applied. The Supreme Court upheld lower courts' findings that the termination was illegal because the restructuring agreement did not modify the original contract's grace period provision. The Court applied Civil Code principles of contract interpretation, emphasizing that various stipulations must be read together and that parties' contemporaneous acts evidenced their intention to maintain the two-month grace period. This decision reinforces the importance of clear contract modification and the principle that ambiguous terms should be interpreted to give effect to all provisions of an agreement.