When a Lessor Evicts Sublessees Before the Lease Ends: Sunbanun v. Go

A lease gives the tenant more than a place to stay. It gives the tenant the right to use the property peacefully for the entire agreed period. When a landlord cuts that period short without a valid reason, the landlord can be ordered to pay for the income the tenant lost — and, if bad faith is present, for moral and exemplary damages as well.

The Supreme Court made this clear in Doris U. Sunbanun v. Aurora B. Go, G.R. No. 163280 (February 2, 2010). The case is a useful reminder that a lessor cannot simply drive out a tenant's occupants because the lease is nearing its end.

The facts of the case

Doris Sunbanun owned a residential house in Cebu City. On July 7, 1995, she leased the entire ground floor to Aurora Go for one year, expiring on July 7, 1996. Go paid a P16,000 deposit and monthly rent.

To earn extra income, Go accepted lodgers, mostly relatives, and earned about P15,000 a month from them. She paid rent until March 1996. That same month, Sunbanun told the lodgers they could stay only until April 15, 1996, because she was terminating the lease. The lodgers left by that date, and Sunbanun padlocked the rooms they vacated.

Go, who worked in Hongkong, filed a damages suit in May 1996. She claimed she lost P45,000 in lodging income for April, May, and June 1996, plus travel expenses.

The lessor's defense

Sunbanun argued that Go violated the lease by subleasing the premises, and that the contract was not renewed after July 7, 1996, so Go had no right to stay. She also moved to dismiss the complaint for failure to comply with barangay conciliation.

During pre-trial, Sunbanun herself moved for judgment on the pleadings, since the only disagreement was how to interpret the lease contract. Go did not object.

What the courts ruled

The trial court ruled for Go, finding that the lease expressly allowed the lessee "to use the premises as a dwelling or as lodging house." Accepting lodgers was therefore not a violation. The court awarded P45,000 in actual damages and P8,000 in attorney's fees.

The Court of Appeals affirmed and added P50,000 in moral damages and P50,000 in exemplary damages. The Supreme Court denied Sunbanun's petition and affirmed.

Why the eviction was a breach

The Court anchored the breach on Article 1654 of the Civil Code, which governs the lessor's obligations. The decision cites this article as the basis of the lessor's duty to preserve the lessee's enjoyment of the leased property. The exact statutory text of Article 1654 is not reproduced in the library copy of the decision, so it is not quoted here; the Court's own language is that the lessor is obliged to maintain the lessee in the peaceful and adequate enjoyment of the lease for its duration. Ejecting the lodgers three months before the lease expired, without a valid reason, violated this duty.

The Court also addressed procedure. Under Section 1, Rule 34 of the Rules of Court, a court may render judgment on the pleadings when the answer fails to tender an issue or admits the material allegations. Because Sunbanun moved for judgment on the pleadings without presenting evidence, she was deemed to have admitted the material allegations of the complaint. No further proof of damages was required from Go.

The damages awarded

The Court sustained the awards on specific grounds:

• Actual damages (P45,000) — for the lodging income lost during April, May, and June 1996.
• Moral damages (P50,000) — under Articles 2219 and 2220 of the Civil Code, in relation to Article 21. Moral damages are recoverable for breach of contract attended by bad faith. The Court found bad faith because Sunbanun pre-terminated the lease without valid reason and never informed Go, who was working abroad.
• Exemplary damages (P50,000) — under Article 2232 of the Civil Code, which the decision describes as allowing exemplary damages when the defendant acted in a wanton, fraudulent, reckless, oppressive, or malevolent manner.
• Attorney's fees (P8,000) and costs — recoverable under Article 2208 of the Civil Code, which the decision cites as the basis for recovering attorney's fees where exemplary damages are awarded.

Practical takeaways

• A lessor must respect the full term of the lease. Cutting it short without a valid ground breaches the lessor's obligations under Article 1654.
• A lease that allows use as a "dwelling or lodging house" permits accepting lodgers. A lessor cannot later treat that as a violation.
• Moving for judgment on the pleadings can be risky. A party who does so may be deemed to have admitted the other side's material allegations, including the damages claimed.
• Bad faith in ending a lease can trigger moral and exemplary damages, not just compensation for lost income.
• Attorney's fees and litigation costs may be recovered where exemplary damages are properly awarded.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.