G.R.

138113

EMILIO BUGATTI, petitioner, vs. COURT OF APPEALS and SPOUSES BEN

BAGUILAT and MARIA BAGUILAT, respondents.

ART 1305. CONTRACT AS DEFINED IN CIVIL CODE AND STAGES OF CONTRACT

October 17, 2000

FACTS OF THE CASE:

Petitioner Emilio Bugatti, the lessee filed petition for certiorari against Court of
Appeals decision on recovery of possession and damages filed by respondents Ben
and Maria Baguilat on July 11, 1989, the land owner and the lessor. The terms and
conditions was agreed by petitioner and respondents that aforesaid that those be
stipulated in a written contract of lease to be prepared by petitioner and presented to
respondents for their approval. However, even before preparing the contract of lease,
petitioner occupied respondents land and began construction. Contracts went through
revisions after disagreements and no contract was signed. Despite the fact that no
contract was signed by the parties, petitioner continued to occupy respondents land.

ISSUE:

Whether or not a contract of lease had been perfected.

RULING:

No, there was no contract of lease had been perfected. Court finds that the trial
court was correct in ruling that no contract of lease was perfected and accordingly, hold
that the appellate court committed reversible error in ruling to the contrary because
during the first week, both parties were discussing the terms and conditions of the
lease, they were merely negotiating. There was no perfection yet of the contract since
both the parties did not agree upon the essential elements of the contract. There was
not meeting of the mind yet. Aside from their verbal objections, respondents sent
petitioner two demand letters to vacate the property and demanded that petitioner
terminate all construction work upon respondents’ property. Respondents’ vehement
protests against petitioners construction activities are a show of no contract had been
agreed yet.