Special Contracts ( Case No. 6) Malayan Realty, Inc. vs. Uy Han Yong Facts: 1. Malayan Realty, Inc.

, is the owner of an apartment unit located at Nagtahan Street, Sampaloc, Manila. Malayan entered into a verbal lease contract with Uy Han Yong over the property. The monthly rental was increased yearly. 2. Malayan sent Uy a written notice informing him that the lease contract would no longer be renewed or extended upon its expiration. But Uy refused to vacate the property prompting Malayan to file before the MeTC of Manila a complaint for ejectment. 3. The MeTC, ruled in favor of Uy, noting that Uy has been occupying the property for more than 40 years he could not be ejected on the ground of termination of contract. Regional Trial Court set aside the judgment of the MeTC on the basis of Article 187 of the New Civil Code. The lease contract was extended for five years by the RTC. A motion for reconsideration was filed but was denied. Court of Appeals modified the RTC decision by shortening the extension of the lease contract to one year. The CA increased the rental at 10% per annum. Issue: Whether or not Uy Han Yong illegally possessed the property Held: Yes. Supreme Court ruled in favor of Malayan. Uy has remained in possession of the property from the time the complaint for ejectment was filed on September 2001 up to present time. Effectively Uy lease has been extended for more than five years which time is under the circumstances, deemed sufficient as an extension and for him to find another place to stay.

Special Contracts ( Case No. 6)

Jestra Development and Management Corporation vs. Daniel Ponce Pacifico Facts: 1. Daniel Ponce Pacifico signed a Reservation Application with Jestra for the purchase of the house and lot in Paranaque, Metro Manila and paid the reservation fee worth P20, 000.00. Under the reservation agreement the total purchase price of the property was P2, 500,000.00 and the down payment equivalent to 30% of the purchase price is to be paid interest free in six monthly installments due every fifth of the month starting July 1996 until December 1996. 2. Upon full payment of the down payment by Pacifico, he was to sign a contract to sell with Jestra. The 70% balance is to be paid within 10 years bearing an interest of 21% per annum a monthly installment basis. Jestra applied the payment of Pacifico as penalty charges foe belated settlement of the down payment. Jestra send a final demand for the remaining 11 installments due and reminded that Jestra reserves its right to automatically cancel or rescind the same o the account of Pacificos failure to comply with the terms. Pacifico informed Jestra that he wanted to dispose the property to recover his investment in which Jestra agreed with the proposal; however, if he failed he would be constrained to re-open or sale. May 1, 1998, Jestra sent him a letter and informed him that within 30 days after receipt he would exercise its right to cancel the contract to sell. 3. Pacifico filed complaint in the Housing and Land Regulatory Board against Jestra for Jestra sold the property to another buyer instead of delivering the property to Pacifico. HLURB decided that he could no longer demand for the delivery for its title having already transferred to another buyer. Court of Appeals decided in favor of Pacifico that he already paid 24.2 installments and that he can demand for delivery. Issue: Whether or not penalty payments should be included in computing the total number of installments. Held: No. The down payment is only included in computing the total number of installments made. Since Pacifico failed to pay the at least two years of installment, he is not entitled to a refund of the cash surrender value of his payments. He took no action on the dishonor of his checks. Jestra is justified in canceling the contract to sell.