Ricardo Cruz v. Hon. Intermediate Appellate Court

Summary

This consolidated case involves a lease contract dispute over the Padre Rada market between lessor Roman Legarda So and lessee Ricardo Cruz representing an unregistered market operators association. The Supreme Court held that So could validly terminate the month-to-month lease contract under Article 1687 of the Civil Code, which provides that monthly rental payments create a definite month-to-month term, not an indefinite lease. The Court rejected Cruz's claim for lease extension, ruling that Article 1687's judicial extension provision applies only to indefinite lease periods, and that Cruz's action was filed after contract expiration. Applying Article 1191 on rescission of reciprocal obligations, the Court found So properly exercised his right to terminate for rental arrearages and enter new contracts with third parties. The decision ordered Cruz to surrender the premises and pay monthly rent from the time he regained possession through preliminary injunction, effectively dissolving the injunction and restoring So's ownership rights.