Reyes Vs CA Digest

Reyes vs.
CA and Kalaw
Appeal from the decision of CA
Facts:
- Reyes et al are lessees of Kalaw.

- The lease was oral and on a month-to-month basis.
- Plaintiffs have been occupying the premises for a period of from 10 to 15 years.
- Kalaw started sending out to each the lessees notices to vacate the premises to give way for
the demolition of the old building occupied by them and the eventual construction of a new
one.
- Kalaw started the demolition of the roofing and upper sidings of the building and also the
fencing thereof, although the demolition of the back portion actually started a week before.
- Reyes et alfiled a complaint for forcible entry with the City Court against Kalaw, praying,
among others, for a writ of preliminary injunction (which was granted) and damages.
- Kalaw counterclaimed for ejectment and damages for alleged loss of the use and occupation of
his premises in the form of (a) fixed losses; (b) monthly losses; and (c) daily losses, also from
until possession is restored.
- City Court rendered its decision in favor of Reyes et al.
- After a compromise agreement with a certain Go Ban, the decision was amended:
o preliminary injunction heretofore issued enjoining the Kalaw from further performing
acts of demolition of the premises hereby declared permanent during the period of the
intended lease
o ordering the defendant Teodoro Kalaw, Jr., to restore the premises to the same
condition as they were before demolition started
o Defendant's counterclaim for want of merit is hereby dismissed.
- Kalaw appealed the aforesaid decision to the Court of First Instance.
- CFI dismissed the complaint and all claims and counterclaims
- Both parties appealed to the Court of Appeals
- CA affirmed CFI’s decision, with the sole modification that plaintiffs should also pay to
defendant Kalaw the sum of P50,000.00 as temperate damages
- Reyes et al appealed to the Supreme Court
Issue: WON it was proper for the Court to award damages to Kalaw (Kalaw filed a counterclaim)
While damages may be adjudged in forcible entry and detainer cases, these "damages" mean "rents"
or "the reasonable compensation for the use and occupation of the premises," 12 or "fair rental value
of the, property." Profits which the plaintiff might have received were it not for the forcible entry or
detainer do not represent a fair rental value.
Since temperate damages are neither "rents" nor "reasonable compensation for the use and
occupation of the premises," nor "fair rental value" as above-stated, and since the agreed rental itself
was adjudged in favor of respondent, 22 We are constrained to deny the temperate damages awarded
by the Court of Appeals.
However, this decision does not preclude respondent from filing in the competent court a separate suit
for damages consisting of other losses allegedly sustained by him as a result of the wrongful
withholding of possession by petitioners-appellants, especially since this question had been raised in
the city court but were beyond its jurisdiction to award.
In Zambales Chromite Mining Co. vs. Robles, it was ruled by this Court that
The Rules expressly provide that upon appeal from the judgment of a justice of the peace to the court
of first instance, the ease shall stand for trial de novo (Section 9, Rule 40). This provision has been
interpreted to mean that parties are prevented from raising issues in the court of first instance which
were not raised in the justice of the peace court.
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We must call attention to the fact that the rules, which have the force of law, provide
the manner and occasion when issue are to be raised for adjudication. If the rules
were to be ignored and We permit litigants to raise issues without order and
regulation, confusion would arise. This would certainly happen were we to allow the
issues the defendant raised in his answer in the Court of First Instance. The
defendant-appellant is not precluded from raising his counterclaim in a separate action
if he decides to do so. But in view of the fact that the trial in the Court of First
Instance in an appeal is merely a trio de novo, We are constrained to dismiss the
counterclaim in pursuance of the dictates and mandate of the rules." (Emphasis
supplied)
While said damages arose out of, or are necessarily connected with, the same transaction or
occurrence which was the wrongful withholding of possession, they are not a compulsory counterclaim
because they exceed the jurisdiction of the inferior court. In Calo vs. Ajax International, Inc., 24 We
held that the rule that a compulsory counterclaim is barred if not set up, when applied to municipal
courts presupposes that the amount involved is within the said court's jurisdiction. The reason for the
rule relating to counterclaims is to avoid multiplicity of suits and to dispose of the whole matter in
controversy in one action, and adjustment of defendants demand by counterclaim rather than by
independent suit. 25 This reason, however, does not obtain where the amount exceeds the jurisdiction
of the inferior court, for, as aptly stated in Calo vs. Ajax International, Inc., supra -
... even if the counterclaim in excess of the amount cognizable by the inferior court is
set up, the defendant cannot obtain positive relief. The Rules allow this only for the
defendant to prevent plaintiff from recovering from him (Rule 5, petition 5, Rules of
Court). This means that should the court find both plaintiff's complaint and defendant's
counterclaim (for the amount exceeding said court's jurisdiction) meritorious it will
simply dismiss the complaint on the ground. that defendant has a bigger credit. Since
defendant still has to institute a separate action for the remaining balance of his
counterclaim, the previous litigation did not really settle all related controversies.

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Reyes vs.

Appeal from the decision of CA

- Reyes et al are lessees of Kalaw.

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