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EDSEL LIGA v. ALLEGRO RESOURCES CORP.

FACTS:

The case involves a dispute between Edsel Liga and Allegro Resources Corporation over the payment of back rentals for a subleased property. In 1975, Ortigas & Company, Limited Partnership leased a parcel of land to La Paz Investment & Realty Corporation. La Paz subleased the property to various individuals, including Liga. When the lease agreement between Ortigas and La Paz expired in 2000, Allegro became the new lessee. Allegro offered to sublease the property to Liga, and they entered into a lease agreement. However, Liga failed to make the agreed rental payments as well as the back rentals. As a result, Allegro filed an ejectment complaint against her. The Metropolitan Trial Court ruled in favor of Allegro, and the Regional Trial Court affirmed the decision with modifications to the monetary awards. Dissatisfied with the decision, Liga appealed to the Court of Appeals, which set aside the RTC's decision and ordered Liga to pay back rentals to both Ortigas and Allegro. Liga then sought recourse before the Supreme Court, arguing that the Court of Appeals erred in ordering her to pay back rentals to Ortigas, as Ortigas was not a party to the case. Liga also claimed that Allegro should not be entitled to the higher monthly rental since it previously agreed to a lower amount. Additionally, Liga asserted that she should not be liable for attorney's fees since she was willing and able to pay the appropriate rentals.

ISSUES:

  1. Whether the Court of Appeals erred in ordering Liga to pay back rentals to Ortigas for the period of 1 January 2001 to 31 August 2001.

  2. Whether the Court of Appeals erred in ordering Liga to pay back rentals to Allegro in the amount of P40,000.00 per month starting from 1 September 2001 until she vacates the property.

  3. Whether Liga should be held liable for attorney's fees in the amount of P20,000.00.

RULING:

  1. Yes. The Court of Appeals erred in ordering Liga to pay back rentals to Ortigas. Since Ortigas is not a party in the case, the judgment cannot bind Ortigas as it goes against the Court's doctrine that judgment cannot bind persons who are not parties to the action.

  2. Yes. The Court of Appeals did not err in ordering Liga to pay back rentals to Allegro in the amount of P40,000.00 per month starting from 1 September 2001 until she vacates the property. Liga signed a lease agreement with Allegro agreeing to pay the said rental and failed to comply with the agreement.

  3. The issue of attorney's fees was not resolved in the given text. There is no ruling on whether Liga should be held liable for attorney's fees in the amount of P20,000.00.

PRINCIPLES: