Surrender Of Leased Premises

In Remington Industrial Sales Corp. v. Chinese Young Men’s Christian Assn. of the Phil. Islands, etc., G.R. No. 171858, January 22, 2007, there was a lease contract over the ground floor and the second floor of a building. Due to disagreement on the rental, the lessee filed a petition for consignation but later on made a “Formal Surrender of the Leased Premises” over the ground floor. It however retained the key of the door or passage way to the second floor as it was using the same. Is there surrender of the premises? Why?

Held: Yes, effectively it was surrendered and vacated.

In a contract of lease, one of the parties binds himself to give to another the enjoyment or use of a thing for a price certain, and for a period which may be definite or indefinite. Upon its termination, the lessee shall return the thing leased and the lessor shall resume possession thereto. (Art. 1665, NCC).

Under the law, possession is acquired by the material occupation of a things or the exercise of a right, or by the fact that it is subject to the action of our will, or by the proper acts and legal formalities established for acquiring such right. (Art. 531, NCC). In short, possession can be either actual or merely constructive. (Rep. v. David, G.R. No. 155634, August 16, 2004; 436 SCRA 571).

Actual possession consists in the manifestation of acts of dominion over property of such a nature as a party would naturally exercise over his own – as when respondent himself is physically in occupation of the property, or even when another person who recognizes the former’s right as owner is in occupancy. Constructive possession, on the other hand, may be had through succession, donation, execution of public instruments, or the possession by a sheriff by virtue of a court order.

When there was “Formal Surrender of Leased Premises” the defendant actually emptied and vacated the leased premises.

The padlocking of the main door of the ground floor units and the continued use thereof as defendant’s passageway to and from the second floor unit did not virtually denied it of its right to possess the unit. There was intention to relinquish in favor of plaintiff its possession over the premises. The filing of the Formal Surrender at the MeTC-Manila, constituted its constructive delivery of the said premises. Thereafter, it actually emptied and vacated the premises. Therefore, the plaintiff could have taken legal and actual possession of premises. It could have easily removed the padlock and occupied the premises in view of its unconditional surrender of the premises.