This case involves the reduction of a penalty clause in a lease agreement between Florentino and Supervalue Inc. The key details are:
1) Florentino frequently closed her store earlier than the mall closing time and increased prices of empanadas without consent.
2) Upon expiration of the lease, Supervalue took possession of Florentino's equipment and security deposit of P192,000 as stipulated in the lease for breach.
3) The Court ruled that forfeiture of the entire security deposit for the breaches was excessive and reduced the penalty to 50%, ordering Supervalue to return half the deposit to Florentino.
This case involves the reduction of a penalty clause in a lease agreement between Florentino and Supervalue Inc. The key details are:
1) Florentino frequently closed her store earlier than the mall closing time and increased prices of empanadas without consent.
2) Upon expiration of the lease, Supervalue took possession of Florentino's equipment and security deposit of P192,000 as stipulated in the lease for breach.
3) The Court ruled that forfeiture of the entire security deposit for the breaches was excessive and reduced the penalty to 50%, ordering Supervalue to return half the deposit to Florentino.
This case involves the reduction of a penalty clause in a lease agreement between Florentino and Supervalue Inc. The key details are:
1) Florentino frequently closed her store earlier than the mall closing time and increased prices of empanadas without consent.
2) Upon expiration of the lease, Supervalue took possession of Florentino's equipment and security deposit of P192,000 as stipulated in the lease for breach.
3) The Court ruled that forfeiture of the entire security deposit for the breaches was excessive and reduced the penalty to 50%, ordering Supervalue to return half the deposit to Florentino.
Petitioner frequently close stores earlier than mall
Issue: Reduction by closing time for delay of delivery of stocks to her Courts store In 2nd letter the respondent informed upon lease Doctrine: expiration on March 31 2000 no longer to extend the lease agreement A penal clause is an accessory undertaking to assume greater Upon expiration, Respondent also took possession of liability in case of breach. equipment and personal belonging of Petitioner from SM store as well as security deposits of P192000 as Function: (1) to provide for liquidated damages, and (2) to provided in Lease Agreement upon breach strengthen the coercive force of the obligation by the threat Petitioner filed case for Sum of Money and Damages; of greater responsibility in the event of breach. RTC ruled in favor of Petitioner that forfeiture of security deposit w/o consent is illegal however CA General Rule: courts are not at liberty to ignore the freedoms modified decision that the forfeiture of security deposit of the parties to agree on such terms and conditions was valid on account of petitioner breach in agreement ISSUE: WON the penalty of forfeiture of security deposit on Exception: (1) if the principal obligation has been partly or account of breach should be reduced by Court irregularly complied with; and (2) even if there has been no Ruling: YES 1. Question of whether a penalty is reasonable or compliance if the penalty is iniquitous or unconscionable iniquitous can be partly subjective and partly objective. (ART 1229) Factors include: type, extent and purpose of the penalty, the nature of the obligation, the mode of breach and its consequences, the supervening realities, Facts: the standing and relationship of the parties, and the Petitioner is engaged in the retail of empanada; like Respondent is engaged in the leasing of stalls and 2. Forfeiture of the entire amount of the security deposits stores within SM in the sum of P192,000.00 was excessive and Parties entered into a lease Agreement with renewal unconscionable considering that the gravity of the upon agreement breaches committed by the petitioner is not of such Respondent submits 2 letters to Petitioner first letter degree stating the latters failure to accord to the contract for: 3. It is in the exercise of its sound discretion that this 1. Selling a variety of empanada as such increasing court tempered the penalty to 50%. The respondent is price without her consent P20 to P22 therefore under the obligation to return the 50% of P192,000.00 to the petitioner.