The Supreme Court ruled that a co-owner can independently file an ejectment suit to recover property for the benefit of all co-owners, and that prior barangay conciliation is sufficiently met if the core issue (like rental increase) was already discussed, even if ejectment wasn’t explicitly mentioned. This decision clarifies the scope of co-owner rights in property disputes and provides guidance on fulfilling conciliation requirements before filing eviction cases, impacting landlords, tenants, and property co-owners.

Rental Hikes and Eviction Rights: When Can a Co-Owner Act Alone?

The case of Leo Wee v. George De Castro (G.R. No. 176405, August 20, 2008) revolves around a dispute over a leased property in Alaminos City. Respondents, as registered co-owners, sought to eject petitioner Leo Wee for failing to pay an increased rental amount. Wee contested the ejectment, arguing that the respondents failed to comply with the jurisdictional requirement of prior conciliation before the Barangay Lupon and that the complaint lacked a crucial allegation of “unlawful withholding” of the property. The Municipal Trial Court (MTC) dismissed the case, a decision affirmed by the Regional Trial Court (RTC). However, the Court of Appeals (CA) reversed these rulings, ordering Wee to vacate the property and pay the increased rental. The Supreme Court was then petitioned to resolve whether prior barangay conciliation was indeed satisfied, whether the co-owner’s action was proper, and whether the complaint sufficiently alleged unlawful withholding.

The petitioner argued that the respondents’ failure to undergo a proper conciliation process before the Barangay Lupon was a jurisdictional defect that barred the ejectment action. According to the petitioner, the Certification to file action issued by the Barangay Lupon only pertained to the rental increase issue, not to the unlawful detainer of the property. The Supreme Court, however, clarified that the conciliation proceedings related to the rental amount logically included the matter of property possession, the lease agreement, and any violations thereof. This ruling acknowledges the practical connection between rental disputes and the right to possess the leased property.

The legal framework for this decision rests on the Katarungang Pambarangay Law, which requires parties to undergo a conciliation process before filing a complaint in court. This requirement aims to decongest the courts and promote amicable settlements at the barangay level. However, the Supreme Court recognized that a rigid interpretation of this requirement would be impractical in cases where the core issue has already been discussed during conciliation, even if not all related issues were explicitly raised.

Article 1687 of the Civil Code also played a crucial role in the court’s decision, as it states that if no period for the lease has been fixed, the lease is understood to be from month to month if the rent agreed upon is monthly. In this case, the absence of a fixed lease period, coupled with the petitioner’s refusal to pay the agreed-upon rental increase, justified the respondents’ demand for ejectment.

The court referenced the case of Chua v. Victorio (G.R. No. 157568, 18 May 2004) to emphasize the lessor’s right to rescind the contract of lease for non-payment of the demanded increased rental. The Supreme Court in Chua held:

The right of rescission is statutorily recognized in reciprocal obligations, such as contracts of lease. In addition to the general remedy of rescission granted under Article 1191 of the Civil Code, there is an independent provision granting the remedy of rescission for breach of any of the lessor or lessee’s statutory obligations. Under Article 1659 of the Civil Code, the aggrieved party may, at his option, ask for (1) the rescission of the contract; (2) rescission and indemnification for damages; or (3) only indemnification for damages, allowing the contract to remain in force.

Payment of the rent is one of a lessee’s statutory obligations, and, upon non-payment by petitioners of the increased rental in September 1994, the lessor acquired the right to avail of any of the three remedies outlined above.

Furthermore, the petitioner challenged the respondents’ ability to file the ejectment suit, claiming that not all co-owners were joined in the action. Article 487 of the New Civil Code directly addresses this concern. It explicitly states, “Any one of the co-owners may bring an action in ejectment.” This provision allows a co-owner to initiate such an action without the necessity of joining all other co-owners as co-plaintiffs, as the suit is deemed to be instituted for the benefit of all. The Supreme Court cited Carandang v. Heirs of De Guzman (G.R. No. 160347, 29 November 2006) to support the argument that only one co-owner is an indispensable party to an ejectment action.

Moreover, respondents Annie de Castro and Felomina de Castro Uban executed Special Powers of Attorney (SPAs), granting respondent George de Castro the authority to initiate Civil Case No. 1990. Although not strictly required, these SPAs reinforced George de Castro’s authority to act on behalf of all co-owners. The Court also stated in Mendoza v. Coronel (G.R. No. 156402, 13 February 2006) that the execution of the certification against forum shopping by the attorney-in-fact is not a violation of the requirement that the parties must personally sign the same.

Finally, the petitioner argued that the complaint lacked the jurisdictional allegation of “unlawful withholding” of the property. The Supreme Court clarified that while the specific phrase wasn’t used, the complaint sufficiently alleged that the petitioner’s possession, initially lawful under the lease agreement, became unlawful upon the termination of the lease and the petitioner’s refusal to vacate. The court held that in an action for unlawful detainer, an allegation that the defendant is unlawfully withholding possession from the plaintiff is deemed sufficient, even without using the exact phrase.

In summary, the Supreme Court affirmed the Court of Appeals’ decision, ordering the petitioner to vacate the property and pay the back rentals, attorney’s fees, and costs of the suit. The High Court found that prior barangay conciliation was sufficiently complied with, a co-owner can independently file an ejectment suit, and the complaint adequately alleged unlawful withholding.

FAQs

What was the key issue in this case?	The central issue was whether the respondents sufficiently complied with the requirement of prior barangay conciliation before filing an ejectment suit against the petitioner. The Court also addressed whether the co-owner properly filed the action and whether the complaint sufficiently alleged unlawful withholding of the property.
Can a co-owner file an ejectment suit without the other co-owners?	Yes, Article 487 of the New Civil Code explicitly allows any one of the co-owners to bring an action in ejectment. The suit is deemed to be instituted for the benefit of all co-owners, so joining all other co-owners as co-plaintiffs is unnecessary.
What is the role of barangay conciliation in ejectment cases?	The Katarungang Pambarangay Law requires parties to undergo a conciliation process before the Barangay Lupon as a precondition to filing a complaint in court. This aims to promote amicable settlements and decongest court dockets.
Is it necessary to specifically mention ‘ejectment’ during barangay conciliation?	No, the Supreme Court clarified that if the core issue (e.g., rental increase) was discussed during conciliation, it constitutes sufficient compliance, even if ejectment was not explicitly mentioned. The conciliation proceedings for the amount of monthly rental should logically and reasonably include also the matter of the possession of the property subject of the rental, the lease agreement, and the violation of the terms thereof.
What does ‘unlawful withholding’ mean in an ejectment case?	‘Unlawful withholding’ implies that the defendant’s possession was initially lawful but ceased to be so upon the expiration of their right to possess. This often occurs when a lease agreement expires, and the tenant refuses to vacate the property.
What happens if a tenant refuses to pay a rental increase?	The lessor has the right to rescind the contract of lease for non-payment of the demanded increased rental. This may lead to an ejectment action to recover possession of the property.
What is a Special Power of Attorney (SPA) in the context of this case?	An SPA is a written instrument by which one person (the principal) appoints another (the agent) to perform specific acts on their behalf. In this case, Annie de Castro and Felomina de Castro Uban executed SPAs, giving George de Castro the authority to initiate the ejectment case in their behalf.
Is it necessary for all plaintiffs to sign the verification and certificate of non-forum shopping?	No, the Supreme Court has held that the execution of the certification against forum shopping by the attorney-in-fact (the agent) is sufficient. The agent, authorized to file the complaint, is considered a party to the suit.

This case clarifies the rights and responsibilities of co-owners and tenants in lease disputes, emphasizing the importance of barangay conciliation and the ability of co-owners to act independently to protect their property rights. It serves as a reminder of the necessity to adhere to the lease terms and to undergo proper conciliation proceedings before initiating legal actions.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Leo Wee v. George De Castro, G.R. No. 176405, August 20, 2008