Francisco D. Palanca v. The Honorable Intermediate Appellate Court

Summary

This ejectment case involved Francisco Palanca seeking to evict tenant Reynaldo Incomio from a Quezon City apartment unit leased since 1965. The central issues were whether a mutually agreed rental increase from P160 to P500 monthly violated Batas Pambansa Blg. 25's rent control provisions, and whether a month-to-month verbal lease could be terminated for ejectment. The Supreme Court ruled that rent control laws prohibit only unilateral increases by lessors, not voluntary agreements between parties, evidenced by the tenant's consistent payments without protest for over two years. Additionally, the Court held that month-to-month leases under Civil Code Article 1687 have definite periods expiring monthly, allowing termination and ejectment upon proper notice. The decision reinforced that rental laws should not stifle voluntary agreements between landlords and tenants while protecting against lessor abuse.