Lim vs Lim

10 Phil 635

Facts:
A tenant and a landlord entered into a contract of lease through an oral
agreement. The agreement stipulates that the tenant would lease the property owned
by landlord for agricultural purposes. It was also agreed by the party that half of the
crops that will be harvested in the subject land will be divided into two equal shares.
Meaning, half of the harvest will be given to the landlord and half of the harvest will be
taken by tenant. s
However, after the harvest. The landlord violated the agreement by selling the
harvested crops and refused to give the tenant his rightful share. Due to the actions of
the landlord. The tenant brought such matter into court and prayed for the
enforcement of the oral agreement and for damages caused by the selling of the
landlord of the whole crops harvested.
Issue:
Whether or not can the Statute of Frauds under enforceable contracts apply for
actions for damages or actions for specific performance because of the breach of
contract caused by the landlord in the oral contract of lease.

Ruling:
No, the Statutes of Fraud cannot apply neither for actions for damages or for
actions for specific performance in such case. Under article 1403 section 2 of the Civil
Code of the Philippines requires that certain contracts such as sale of real property,
donations amounting to five thousand or more, and lease agreements exceeding one
year must be in writing to be enforceable in court through actions or suits. This is to
prevent fraud and perjury by ensuring there is a reliable record of the agreement.
The Statute of Frauds cannot apply in such case because the said contract of
lease was made through an oral agreement and Statute of Frauds does not cover
actions for damages and action for specific performance. As such actions are under
the scope of rescissible contracts not enforceable contracts. Hence, the tenant cannot
enforce the agreements in the contract of lease. The tenant can recover, although it
should be in writing, the damages asked was not through breach of the lease. The
tenant in this case is asking for damages, because of the agreement of the crops.
So, the tenant can recover damages in the agreement of the harvested crops not
in the contract of lease but through rescission of the agreement of the harvested crops
as the tenant suffered more that one-fourth of the value of the harvested crops due to
the fraudulent act of the landlord. Through rescission the tenant must return the land
to the landlord. And the landlord must reimburse the tenant for the developments and
efforts he made in the said land.