Concept: 1370
Facts:
·
The controversy here revolves around the
appropriate reading of a clause in a lease contract that was executed about
fifteen years ago.
·
July 31, 1973. Miguel Tajangco (respondent
and lessor) and Celso Fernandez (petitioner and lessee) entered into a ten-year
Contract of Lease over a piece of land situated along Kahilum Street, Pandacan,
Manila, where Fernandez would put up the then proposed New Zamora Market. The
parties agreed that the lease, which was scheduled to end on 1 July 1983, would
be "renewable for another ten (10) years at the option of both parties
under such terms, conditions and rental reasonable at that time" and that,
upon expiration of the lease, whatever improvements were then existing thereon
should automatically belong to Miguel without having to pay Fernandez.
·
Before the term ended, asshole Miguel said to
Fernandez that he is no longer willing to renew the contract. Fernandez being a
hardass, replied that he wants to renew the contract so he could recover the
expenses he had made. Miguel not giving in, replied through his lawyer, advised
that Miguel could not accept Fernandez's unilateral action to renew the lease
because, under the contract, any renewal or extension thereof was possible only
"at the option of both parties.
·
June 12, 1983. Fernandez filed an action
against Miguel. He said that he was entitled to renew the lease contract, under
paragraph 3 Section 2 thereof, for another ten (10) years, which paragraph in
the contract should be construed in a liberal manner and with justice. In his
prayer, he sought to compel Miguel to renew the lease agreement for another
term, or asked the court to consider the original contract as renewed for
another ten (10) years or to fix another period for the renewal contract.
·
Miguel the asshole replied that judicial
interpretation is not needed, the contract is so simple worded that even Homer
Simpson can understand it.
·
The trial court held its decision in favor of
Fernandez. Miguel, being an asshole and won’t accept defeat, appealed with the
CA. The CA reversed the decision of the trial court. BOOM! HEIRARCHY YOW!
Issue: W/ON the
condition of the contract is clear or not.
Held: Shit is clear. The CA said that the contract
language as comprising, not technical terms or terms of legal art, but rather
just plain and ordinary words. SC affirmed the decision of the CA
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