Practice Court

Group 4
Regine Jessica Abuel
Erwin Bautista
Christian Urbina

Case Summary
4-D

Civil Case for Sum of Money and Damages

[with Application for Writ of Preliminary Attachment]
Plaintiff: X City
Defendants: Y Hotel and A, B, C, D, and E in their capacities as members of the Board of
Directors
The Plaintiff is this case is a public juridical entity created by the laws of the Republic of
the Philippines (X City) while the Defendant is a domestic corporation duly registered under
Philippine laws (Y Company). Defendant A is being sued in his capacity as Treasurer of Y
Company and as member of the Board of Directors. Similarly, Defendants B, C, D, and E are all
sued in their respective capacities as members of the Board of Directors.
X City is the absolute and registered owner of a Hotel and Convention Center and the lot
where it is located. On January 2011, X City and Y Company entered into a Lease Contract over
the Hotel and Convention Center, including the equipment, furniture, fixtures, accessories and
other appurtenances found inside the leased property at a monthly rate of Php 1,000,000.00. In
the said Lease Contract, Y Company as the Lessee was granted a grace period of three months,
commencing from January 2011 to March 2011 for which no monthly rental should be paid. As
agreed upon, the monthly rental payment shall commence on April 2011 and every month
thereafter. Upon execution of the contract, X City delivered to Y Company the leased premises
and surrendered its possessory right over the same pursuant to the Lease Contract. From then on,
Y Company through Defendant A and other individual defendants commenced to exercise the
lessees right of possession under the Lease Contract.
X City now brings this case to the court based on three causes of action. The following
causes are: (1) wanton and willful breach of certain provisions of the Lease Contract including
non-payment of rentals and electric bills, unauthorized subleasing and failure to secure an
insurance policy; (2) withholding and acceptance of payment for reservations and bookings
despite the alleged valid termination of the Lease Contract by X City; and (3) recovery of lost
properties belonging to X City found within the leased premises amounting to Php 2,590,621.00
and other damages caused by Y Company during the term of lease.
Because of the above-mentioned causes of action, X City now asks for a total amount of
Php 11,709,159.15 for actual damages. X City likewise prays that the court grant its Application
for Preliminary Attachment to serve as a security for the satisfaction of any judgment that may be
recovered from Y Company. Other reliefs and remedies as are just and equitable under the
premises are likewise prayed for.

On the other hand, Y Company asserts that the Lease Contract entered into by the parties
was invalid for the reason that the said contract was in violation of Republic Act 6957 or the
Build-Operate-Transfer Law and its corresponding Implementing Rules and Regulations that
were in effect at the time of the contracts approval and signing. Y Company also asserts that the
Lease Contract is invalid because there is a material deviation from the terms and condition set
forth in the draft contract and the approved Lease Contract by the Sanggunian Panlalawigan as
required by law. As to the defense of non-payment of rentals, Y Company states that on the
assumption that the Lease Contract was exclusively and solely a lease, the said contract was
perfected on April 2011 and not on January 2011 as alleged by the Plaintiff based on the true
intent of the parties. Further, Y Company denies any sub-lease. It also argues that the company
was not prohibited from accepting reservations and bookings for the use of the Hotel and
Convention Center. Lastly, Y Company states that the alleged lost properties found inside the
leased premises are not owned by X City.
Defendant Y Company prays that the complaint be dismissed for lack of merit. Likewise,
Defendants A, B, C, D, and E all assert that there is a failure to state a cause of action against its
directors and asserts the prohibition on piercing the corporate veil.