FORM OF CONTRACT OF LEASE OF THINGS

KINDS OF LEASE
1. Lease of things or properties whether immovable or movable property
􀂃 one of the parties binds himself to give to another the enjoyment or use of a thing
􀂃 for a price certain
􀂃 for a period which may be definite or indefinite
􀂃 but in no case will the period exceed 99 years.

WHAT CAN BE THE SUBJECT OF A LEASE
- only things which are within the commerce of man; lease of properties belonging to the
public domain cannot be proper subjects of lease; such contracts are void.

PERSONS DISQUALIFIED TO BECOME LESSEES:
(a) husband and wife cannot lease to each other their separate properties (exception:
separation of property)
(b) those disqualified due to fiduciary relationship
- guardian: ward
- agent: principal
- executor & administrators
- public officer: state property
- justices, judges: property under litigation
- others disqualified by law

LEASE BY FILIPINOS
- may lease lands of public domain with an area of 500 has. and may acquire not more than 12 has.

LEASE BY CORPORATIONS
- at least 60% Filipino-owned, may lease lands of public domain for a period of 25 years, renewable for not more than 25 years; the area not to exceed more than 1,000 has. [one thousand hectares]

RULE ON LEASE OF THINGS WHEN LESSEE IS AN ALIEN
(a) 99-year limit applies to aliens as long as it is a lease of personal property
(b) aliens CANNOT lease public lands, and cannot acquire private lands except through succession
(c) if lease of real property (private lands), maximum of 25 years renewable for another
25 years (P.D. 713)
(d) under the Investor’s Lease Act of 1995, the 25-year period was extended to 50 years renewable for another 25 years provided the following conditions are met:
i. lessee must make investments
ii. lease is approved by DTI
iii. if terms are violated, DTI can terminate it
NOTE: the ILA did not do away with P.D. 713, under ILA the consent of DTI is required while in P.D. 713 it is not.

FORM OF CONTRACT OF LEASE OF THINGS
- may be made orally but if the lease of real property is for more than one year, it must be in writing under the statue of frauds [still valid but nforceable]

NOTE: - Owner has the right t fix the rent because the contract is onsensual and not imposed by law
- Increasing the rent is NOT an absolute right of the lessor
- If the rent is fixed for the first time, courts cannot interfere; but if it is a renewal, the courts can settle the disagreements

2. Lease of work which refers to contract for a piece of work
- one of the parties binds himself to produce a result out of his work or labor and the other party binds himself to pay a remuneration therefor.

DUTIES OF CONTRACTOR WHO FURNISHES WORK & MATERIAL:
(a) duty to deliver
(b) duty to transfer ownership
(c) duty to warrant eviction and hidden defects

REMEDY OF EMPLOYER IN CASE OF DEFECTS:
- ask contractor to remove the defect or to execute another work; if contractor fails or refuses, employer can ask another at the contractor’s expense

3. Lease of service
-one party binds himself to render some service to the other party consisting his own free activity of labor, and not its result and the other party binds himself to pay a remuneration therefor.

3 KINDS:
a. household
b. contract of labor
c. common carriers