G.R. No. 120554 September 21, 1999
Lessons Applicable: Interference with Contractual Relations (Torts and Damages)
Laws Applicable: Sec. 1314 of the Civil Code
FACTS:
- 1963: Tek Hua Trading Co, through its managing partner, So Pek Giok, entered into lease agreements with lessor Dee C. Chuan & Sons Inc. (DCCSI)
- Subjects of 4 lease contracts were premises located at Soler Street, Binondo, Manila
- Tek Hua used the areas to store its textiles.
- The contracts each had a one-year term. They provided that should the lessee continue to occupy the premises after the term, the lease shall be on a month-to-month basis.
- When the contracts expired, the parties did not renew the contracts, but Tek Hua continued to occupy the premises
- 1976: Tek Hua Trading Co. was dissolved. Later, the original members of Tek Hua Trading Co. including Manuel C. Tiong, formed Tek Hua Enterprising Corp.
- 1986: So Pek Giok died
- So Ping Bun, occupied the warehouse for his own textile business, Trendsetter Marketing
- August 1, 1989: lessor DCCSI sent letters addressed to Tek Hua Enterprises, informing the latter of the 25% increase in rent effective September 1, 1989.
- The rent increase was later on reduced to 20% effective January 1, 1990, upon other lessees' demand.
- December 1, 1990: the lessor implemented a 30% rent increase.
- Enclosed in their letters were new lease contracts for signing which So Ping Bun did not answer. Still, the lease contracts were not rescinded.
- So Ping Bun refused to vacate
- So Ping Bun requested formal contracts of lease with DCCSI in favor Trendsetter Marketing
- A suit for injunction was filed
- RTC: Granted annulling the four Contracts of Lease without awarding damages
- CA upheld RTC
ISSUE: W/N the injunction should be upheld and
HELD: AFFIRMED, with MODIFICATION that the award of attorney's fees is reduced from two hundred thousand (P200,000.00) to one hundred thousand (P100,000.00) pesos
- Damage is the loss, hurt, or harm which results from injury, and damages are the recompense or compensation awarded for the damage suffered. One becomes liable in an action for damages for a nontrespassory invasion of another's interest in the private use and enjoyment of asset if
- (a) the other has property rights and privileges with respect to the use or enjoyment interfered with,
- (b) the invasion is substantial,
- (c) the defendant's conduct is a legal cause of the invasion, and
- (d) the invasion is either intentional and unreasonable or unintentional and actionable under general negligence rules
- elements of tort interference are:
- (1) existence of a valid contract;
- (2) knowledge on the part of the third person of the existence of contract; and
- (3) interference of the third person is without legal justification or excuse
- Son Ping Bun asked DCCSI to execute lease contracts in its favor, and as a result deprived DCCSI's property right
- damage is NOT an essential element of tort interference
- lower courts did not award damages, but this was only because the extent of damages was not quantifiable
- Lack of malice precludes damages. But it does not relieve petitioner of the legal liability for entering into contracts and causing breach of existing ones.
- The injunction saved the respondents from further damage or injury caused by petitioner's interference.