A. The corporation with offices occupying the Army and Navy Club Building of Manila (petitioner) filed a Motion for Leave to File and for Admission of Amended Answer that was denied by the Metropolitan Trial Court (MTC) due to lack of merit, hence led to their vacation of the area alongside which are payments for the costs of suit and rental arrearages with legal interest.
The petitioner was unable to follow its contractual obligations under the Contract of Lease executed in January 1983 due to the following reasons:
Under paragraph 1, The lessee has failed and/or refused to construct the hotel long after the expiration period specified in the contract. The plaintiff agreed for the lessee's continued retention of the property on a lease-back agreement with the basis of warranties from the defendant to build a modern multi-storied hotel.
Under paragraph 3, The corporation, despite the plaintiff's demand to pay, failed with its rental obligation in January 1983 with its rental account standing at P1,604,166.70 as of May, 1989.
Under paragraph 4, The corporation failed to pay the property taxes that its total liability amounted to P3,818,913.81 as of December 1989
This led to the rescission of the Contract of Lease by the plaintiff and was followed by their demand on the corporation to vacate the area, contained in a letter dated May 24, 1989.
On the contrary, the petitioner filed its answer to the complaint on December 29, 1989. Followed by a "Motion for Leave to File and for Admission of Amended Answer" also filed by them on February 22, 1990 with allegations asserting additional special and affirmative defenses. The petitioner argued that their area was declared as a historical landmark to counter their eviction, but the NHCP doesn't grant them the ownership of the property as the lease agreement was acknowledged from the beginning.
On May 23, 1990, the MTC denied the petitioner's motion for leave leave to admit its amended answer for lack of merit.
B. I accept the court’s decision because it was clear that the petitioner does not deny the existence of the lease agreement (in their answer filed on December 29, 1989) and admitted its inability to pay their liabilities and to construct a multi-storey building. The petitioner was fully aware of the fact that they weren't able to follow their obligations to the property. Moreover, their claim regarding the area as a historical landmark leads them to no formal rule by the government to have property rights on it.