Pedro Cui v. Sun Chan (Alias Sanchay)

Summary

This 1921 Supreme Court case established important precedent regarding lease contract rescission. Pedro Cui leased property to Sun Chan with a clause prohibiting construction without permission. When Sun Chan built two awnings without consent, Cui sought to rescind the lease. The trial court found the unauthorized construction occurred but denied rescission rights. The Supreme Court reversed, holding that breach of lease conditions constitutes grounds for rescission under Civil Code Article 1569. The Court emphasized that in reciprocal obligations, the injured party may choose between demanding performance or seeking resolution under Article 1121. This decision clarified lessor's rights when lessees violate construction restrictions, establishing that express rescission clauses are unnecessary when dealing with reciprocal contractual obligations governed by the Civil Code.