SECOND DIVISION

[G.R. No. L-46468. May 27, 1981.]

FRANCISCO SAURE, petitioner, vs. HON.

PRUDENCIO S. PENTECOSTES, Municipal Judge of
Camiling, Tarlac, DEPUTY SHERIFF VIVENCIO
PALANCIO, SPOUSES TELESFORO GALANG and
NIEVES GALANG,respondents.

Merecedes M. Respicio for petitioner.

Perfecto D. Corpuz for private respondent.

SYNOPSIS

Private respondents sought the ejectment of petitioner for refusing to

submit to an increase in rentals. Respondent municipal judge, in
disregard of Presidential Decree No. 20 which suspended indefinitely
the filing of ejectment cases except when the lease is for a definite
period and which prohibited the increase in rentals of dwelling units
where the monthly rentals do not exceed P300 a month, ruled in favor
of private respondents and denied the motion for relief from judgment
filed thereafter by the petitioner. Hence, this petition to set aside the
aforesaid decision.

The Supreme Court granted the petition and nullified respondent

judge's decision, it being a clear case of jurisdictional infirmity and ruled
that the applicable provision of Presidential Decree No. 20 should he
applied as petitioner occupied a residential unit and not a commercial
establishment, notwithstanding the small photography shop in the
premises. Petitioner was declared entitled to remain as lessee after
paying all back rentals due and owing, his failure to make the necessary
consignation being excusable.

Petition granted.

SYLLABUS

1.CONSTITUTIONAL LAW; STATUTES; RENT CONTROL LAW;

PRESIDENTIAL DECREE NO. 20. — Presidential Decree No. 20
indefinitely suspended the filing of ejectment cases except when the
lease is for a definite period and prohibited the increase in rentals of
dwelling units where the monthly rentals do not exceed P300.00 a
month.

2.ID.; ID.; ID.; ID.; A POLICE POWER MEASURE TO BE LIBERALLY

CONSTRUED. — The legislation or decree relating to rent control is a
police power measure intended to alleviate the plight of lessees
occupying premises with a monthly rental of less than P300.00. The
construction that should be given to it therefore should be of a liberal
character. Otherwise, its beneficent purpose could be frustrated.

3.ID.; ID.; ID.; ID.; APPLICABLE TO EXISTING CONTRACTS. — In the

case of Gutierrez vs. Cantada, L-36797, May 3, 1979, the Supreme
Court held: The applicability of Presidential Decree No. 20 to existing
contracts cannot be denied. From Pangasinan Transportation
Co. vs. Public Service Commission, such a doctrine has been repeatedly
adhered to by this Court. As was held in Ongsiako vs. Gamboa, decided
in 1950, a police power measure being remedial in character covers
existing situations; otherwise, it would be self-defeating.

4.ID.; ID.; ID.; RESIDENTIAL UNIT, DEFINED. — Batas Pambansa Big.

25 defines a residential unit as that which "refers to an apartment,
house and/or land on which another's dwelling is located used for
residential purposes and shall include not only buildings, parts or units
thereof used solely as dwelling places, except motels, motel rooms,
hotels, hotel rooms, boarding houses, dormitories, rooms and
bedspaces fur rent, but also those used for home industries, retail
stores or other business purposes if the owner thereof and his family
actually live therein and use it principally for dwelling
purposes: Provided, That in the case of a retail store, home industry or
business. the capitalization thereof shall not exceed five thousand pesos
(P5,000.00): and Provided, further, that in the operation of the store,
industry or business, the owner thereof shall not require the services of
any person other than the immediate members of his family."

5.ID.; ID.; ID.; CIRCUMSTANCES IN THE CASE AT BAR CALL FOR THE
APPLICATION OF PRESIDENTIAL DECREE NO. 20. — The belief of
respondent judge that the premises in question, being located in a
commercial section of the town of Camiling. was outside the operation
of the decree is unjustified. Petitioner was occupying only one of the
units in the building in question, all of which served as the dwelling
places of the lessees. They therefore fall within the explicit language of
Presidential Decree No. 20. It is not the location but the use of the
premises in question that is decisive. Nor is the application of the
decree defeated by the fact that there is a small photo shop owned by
petitioner. Again, what calls for the setting aside of a decision is the
fact that respondent Judge disregarded the evidence which showed that
petitioner and his family had lived in such place for the last ten years.
Under the circumstances, to refuse to recognize that the case of
petitioner comes within the operation of the decree is to disregard and
ignore its command. Furthermore, there is testimony, unrefuted, that
the capital of the photo shop was in the amount of P2,500.00 and that
services of persons other than the immediate members of petitioner's
family were not required.

6.ID.; ID.; ID.; ID.; PAYMENT OF BACK RENTALS REQUIRED. — The

failure of petitioner to deposit the rental is mitigated by the fact that he
did offer to pay the former rental, but private respondents made it clear
that they would not accept. Petitioner was not advised by his counsel to
make the necessary consignation. At any rate, it can be stated legally
that the action for ejectment not being allowable in law at all, and a
clear case of jurisdictional infirmity being apparent, such failure could
be considered excusable. Petitioner, however, must pay all the back
rentals due and owing. In according him justice through law, no
injustice should be visited on private respondents.

7.ID.; ID.; ID.; BATAS PAMBANSA BLG. 25; ANNUAL TEN PERCENT
INCREASE ALLOWED. — Effective April 10, 1979 and for a duration of
five years thereafter, Batas Pambansa Blg. 25 provides that the monthly
rentals of all residential units not exceeding three hundred pesos shall
not be increased, for any one year period, by more than ten percent of
the monthly rentals existing at the time of the approval of the Act. The
yearly increases authorized therein shall be cumulative.

DECISION

FERNANDO, J : p

It is readily discernible from the records of this certiorari and prohibition

proceeding why the Citizens Legal Assistance Office of the Ministry of
Justice took such pains to nullify and set aside a decision of respondent
Municipal Judge Prudencio S. Pentecostesof Camiling, Tarlac 1 ejecting
petitioner as lessee from the building owned by private respondents,
the spouses Telesforo and Nieves Galang, 2 as well as his order denying
a motion for relief from judgment. 3 The point stressed, and rightly so,
is that respondent Judge disregarded the plain command of Presidential
Decree No. 20 which suspended indefinitely the filing of ejectment
cases except when the lease is for a definite period and which
prohibited the increase in rentals of dwelling units where the monthly
rentals do not exceed P300.00 a month. There is no evidence
whatsoever that disproves the allegation that petitioner Saure is
occupying the premises in question as his residence. The fact that he
has a small photography shop undoubtedly to supplement his income
does not transform it into a commercial establishment. Moreover, no
period had been fixed for the duration of his occupancy. As a matter of
fact, it could not be denied that the only reason of private respondents
for seeking his ejectment was his refusal to submit to an increase in
rentals from P50.00 to P180.00, the Presidential Decree
notwithstanding. In the light of the undisputed facts, the jurisdictional
infirmity of the actuation of respondent Judge is quite obvious. It is
surprising how he could have decided the matter the way he did. The
explanation, but not the justification, apparently lies in the fact that the
building in question, a unit of which is the residence of petitioner, is
located in the commercial district of Camiling, Tarlac. That does not
suffice.

There is merit to the petition.

1.The ruling in the recent case of Salaria v. Buenviaje, 4 the opinion

being penned by Justice Guerrero, is quite categorical. Where
Presidential Decree No. 20 calls for application, the fact that the lessor
needed the premises for his personal use could not defeat its
application. Accordingly, it was categorically held that the lessee
"cannot be ordered to vacate the premises of the land in question"
pursuant to the applicable law. 5 Private respondents could not even
allege such purpose. All they were interested in was that the rentals be
increased, contrary to what is ordained by Presidential Decree No. 20.
The case for petitioner is thus much stronger.

2.In a still later decision of this Court, Gutierrez v. Cantada, 6 the same
approach was followed. In that case, the decision of the then
respondent Judge Santiago O. Tanada was upheld, a suit for certiorari
against him filed by the lessor being dismissed. Such special civil action
was filed in this Court as a suit for ejectment against the tenant did not
prosper. It was pointed out in the opinion that Presidential Decree No.
20 as well as the previous act regulating rentals 7 which it amended
"had a common objective to remedy the plight of the lessees,
Presidential Decree No. 20, moreover, having a constitutional sanction
in that it is specifically referred to in the fundamental law as part of 'the
law of the land.' Under the former statute, actions for ejectment were
'suspended from two years from the effectivity' thereof. . . . Such a
period was made indefinite by Presidential Decree No. 20 thus: 'Except
when the lease is for a definite period, the provisions of paragraph (1)
of Article 1673 of the Civil Code of the Philippines insofar as they refer
to dwelling unit or land on which another's dwelling is located shall be
suspended until otherwise provided; but other provisions of the Civil
Code and the Rules of Court of the Philippines on lease contracts,
insofar as they are not in conflict with the provisions of this Act, shall
apply.' Under paragraph (1) of Article 1673 of the Civil Code, one of the
grounds for judicially ejecting the lessee is the expiration of the period
fixed for the duration of the lease." 8 It bears repeating that the
legislation or decree of the above character is a police power measure
intended to alleviate the plight of lessees occupying premises with a
monthly rental of less than P300.00. The construction that should be
given to it therefore should be of a liberal character. Otherwise, its
beneficent purpose could be frustrated. Nor could any doubt be
entertained that the decree applied to leases entered into prior to its
issuance. There is relevance to this excerpt from Gutierrez v. Cantada:
"The applicability thereof to existing contracts cannot be denied. From
Pangasinan Transportation Co. v. Public Service Commission, such a
doctrine has been repeatedly adhered to by this Court. As was held in
Ongsiako v. Gamboa, decided in 1950, a police power measure being
remedial in character covers existing situations; otherwise, it would be
self-defeating." 9

3.As was pointed out earlier, the only explanation for this failure to
abide by Presidential Decree No. 20 must have been the belief of
respondent Judge that the premises in question, being located in a
commercial section of the town of Camiling, was outside the operation
of the Decree. Such a belief is unjustified. Petitioner was occupying only
one of the units in the building in question, all of which served as the
dwelling places of the lessees. They therefore fall within the explicit
language of the Decree. It is not the location but the use of the
premises in question that is decisive. Nor is the application of the
Decree defeated by the fact that there is a small photo shop owned by
petitioner. Again, what calls for the setting aside of a decision is the
fact that respondent Judge disregarded the evidence which showed that
petitioner and his family had lived in such place for the last ten years.
Under the circumstances, to refuse to recognize that the case for
petitioner comes within the operation of the Decree is to disregard and
ignore its command. Whatever doubt there may be on that score is
removed by this definition of a residential unit in Batas Pambansa Blg.
25: "A residential unit — refers to an apartment, house and/or land on
which another's dwelling is located used for residential purposes and
shall include not only buildings, parts or units thereof used solely as
dwelling places, except motels, motel rooms, hotels, hotel rooms,
boarding houses, dormitories, rooms and bedspaces for rent, but also
those used for home industries, retail stores or other business purposes
if the owner thereof and his family actually live therein and use it
principally for dwelling purposes: Provided, That in the case of a retail
store, home industry or business, the capitalization thereof shall not
exceed five thousand pesos (P5,000.00): and Provided, further, That in
the operation of the store, industry or business, the owner thereof shall
not require the services of any person other than the immediate
members of his family." 10 There is testimony, unrefuted, that the
capital of the photo shop was in the amount of P2,500.00. Nor can
there be any doubt that the services of a person other than the
immediate members of petitioner's family were not required.

4.There is, however, this matter to consider. Petitioner did not deposit
during the pendency of this litigation the monthly rental of P50.00
agreed upon. It could be argued that in Salaria, there was at least a
deposit of P200.00 during the pendency of the litigation. Admittedly,
such amount was not enough, as shown by the last sentence of its
dispositive portion: "The petitioner is, however, ordered to pay back
rentals for the period of his stay on the land at the rate of P10.00 a
month, which is not covered by the deposit." 11 In this case, however,
the failure of petitioner to deposit the rental is mitigated by the fact
that he did offer to pay the former rental, but private respondents
made it clear that they would not accept. Counsel for petitioner ought
to have advised him to make the necessary consignation. This is one
instance however where the client should not be made to suffer for the
omission of counsel. At any rate, it can be stated legally that the action
for ejectment not being allowable in law at all, and a clear case of
jurisdictional infirmity being apparent, such failure could be considered
excusable. Petitioner, however, must pay all the back rentals due and
owing. In according him justice through law, no injustice should be
visited on private respondents.

5.Moreover, Batas Pambansa Blg. 25 affords private respondents some

degree of relief. As therein set forth: "Upon the effectivity of this Act
and for a duration of five years thereafter the monthly rentals of all
residential units not exceeding three hundred pesos shall not be
increased, for any one year period, by more than ten percent (10%) of
the monthly rentals existing at the time of the approval of this Act. The
yearly increases authorized herein shall be cumulative." 12 The Act took
effect on April 10, 1979.
WHEREFORE, the petition for certiorari is granted nullifying the decision
of respondent Judge dated November 17, 1976 and the writ of
execution issued on December 15, 1976 by virtue thereof. The order of
March 10, 1977 of respondent Judge denying the petition for relief from
the aforesaid decision is likewise declared of no force and effect. The
writ of prohibition is granted enjoining respondent Judge and
respondent Deputy Sheriff Vivencio Palancio or any person acting on
their stead or behalf from taking any further action in connection with
Civil Case No. 3066 of the Municipal Court of Camiling between the
spouses Telesforo and Nieves Galang, now private respondents, as
plaintiffs, and Francisco Saure, now petitioner, as one of the
defendants. The restraining order issued by this Court on July 18,1977
is hereby made permanent. Petitioner Francisco Saure is granted a
period of ninety days within which to pay the back rentals. No costs.

Barredo, Aquino, Abad Santos and De Castro, JJ., concur.

Concepcion Jr., J., is on official leave.

Footnotes

1.Deputy Sheriff Vivencio Palancio was likewise named respondent, a writ of

execution having been issued.

2.Petition, Annex C.

3.Ibid, Annex E.

4.L-45642, February 28, 1978, 81 SCRA 722.

5.Ibid, 727.

6.L-36797, May 3, 1979, 90 SCRA 1.

7.Republic Act No. 6359 entitled An Act to Regulate Rentals for Two Years
of Dwelling Units or of Land on Which Another's Dwelling is Located
and Penalizing Violations Thereof, and for Other Purposes.

8.90 SCRA 1, 2-3.

9.Ibid, 5-6.

10.Section 2(b) of Batas Pambansa Blg. 25 (1979).

11.81 SCRA 722, 729.

12.Section 1 of Batas Pambansa Blg. 25 (1979).