[ G.R. No. 7821. December 31, 1913 ] 26 Phil. 485
[ G.R. No. 7821. December 31, 1913 ]
DOMINADOR GOMEZ, PLAINTIFF AND APPELLANT, VS. REMEDIOS SALCEDO, DEFENDANT AND APPELLEE. D E C I S I O N
TRENT, J.:
This is an appeal from a judgment sustaining a demurrer to the complaint on the ground that it does not state facts sufficient to constitute a cause of action. The complaint alleges that the defendant leased a house and lot on November 8, 1910, to one Crary for a period of two years at a monthly rental of P200, said lease being evidenced by a public document and no stipulation being contained therein that the lessee should not sublet the property, Crary sublet a portion of the property during the same month to the plaintiff for a term of two years at a monthly rental of P140, it not being stated whether this lease was evidenced by a writing or not. In February, 1911, the defendant agreed with the plaintiff to subrogate the latter in all the rights and obligations of the original lessee under the lease, at the same time agreeing to a reduction in the rent to P110 per month. The complaint further alleges that the plaintiff has asked the defendant many times to evidence the subrogation of the original lessee in a public document, but that the defendant has always refused to do so with the statement that plaintiff could remain in possession of the property under the conditions of the lease as long as he desired. As a result of a final judgment in the month of December, 1911, in an action of ejectment instituted by the defendant against the present plaintiff the defendant notified the plaintiff that from January 1, 1912, he would be required to pay a monthly rental of P300 for that part of the house occupied by him. There is no indication in the complaint of how the rights of Crary had been disposed of or that he had any knowledge or information concerning the transaction between the plaintiff and the defendant. The first question which arises is whether, by the contract between Gomez and Salcedo, the former acquired Crary’s leasehold rights to the entire property or whether the contract related merely to that portion of the property occupied by Gomez. The complaint is not artistically drawn, and in view of the disposition we propose to make of this case, we shall not attempt to hazard a construction of it which might possibly be contrary to the pleader’s intention. For, whether the subrogation of the plaintiff in the rights of Crary related merely to that part of the property the plaintiff had previously occupied as sublessee or whether such subrogation was intended to completely eliminate Crary as a tenant of the property, the contract evidencing such subrogation necessarily pertains to the leasing for a longer period than one year of real property or an interest therein, and, as such, comes within the statute of frauds. (Sec. 335, C. C. P.) The absolute necessity of holding that this contract between the plaintiff and the defendant comes within the statute of frauds is not alone based upon the law above cited, although that alone is sufficiently clear, it seems to us. Section 335 reads as follows: “In the following cases an agreement hereafter made shall be unenforceable by action unless the same, or some note or memorandum thereof, be in writing, and subscribed by the party charged, or by his agent; evidence, therefore, of the agreement cannot be received without the writing, or secondary evidence of its contents: * * *
“5. An agreement for the leasing for a longer period than one year, or for the sale of real property, or of an interest therein, and such agreement, if made by the agent of the party sought to be charged, is invalid unless the authority of the agent be in writing and subscribed by the party sought to be charged.”
Even on the assumption that the complaint only sets forth a contract of subrogation in the rights of Crary as to the portion of the house occupied by Gomez, it seems clear that Gomez acquired a leasehold interest in the real property in question, unless it be argued that a portion of a property cannot be leased to the exclusion of the remainder. So that if he did acquire a leasehold interest in any part of the property, it falls directly within the italicized words of the above quoted section of the code. When we consider the possible, not to say the probable, consequences from holding that a subtenant or other third person may be subrogated in the rights of the tenant whose contract was and of necessity was required to be in writing, without such contract of subrogation being also in writing, there appears to be no ground upon which to base an assertion that such subrogation need not be reduced to writing. The very avenue for fraud which the purpose of the statute is to close would be open to a dishonest lessee by allowing him to subrogate a third person in Ms own right, ould he prove and enforce such a contract without the necessity of reducing it to writing. For these reasons we say that whether the real property acquired by the plaintiff in the contract of subrogation constituted the entire holding of the defendant or only that portion of it which the plaintiff had theretofore occupied as subtenant, is of no importance. In either view of the case the contract is within the statute of frauds. The next assignment of error relates to the fact that there is no allegation in the complaint that the contract of subrogation therein set forth is in writing or that there exists some note or memorandum thereof signed by the defendant. Is such an allegation necessary? In Price vs. Weaver (13 Gray, Mass., 272), it was said:
“The statute of frauds has not altered the rules of pleading, in law or equity. A declaration on a promise which, though oral only, was valid by the common law, may be declared on in the same manner, since the statute, as it might have been before. The writing is matter of proof, and not of allegation.”
The principle enunciated in this case is still recognized by the great weight of authority. This court has held in a number of cases, among which are Conlu vs. Araneta (15 Phil. Rep., 387), and Gallemit vs. Tabiliran (20 Phil. Rep., 241), that the statute of frauds does not make an oral contract within its terms illegal, but merely voidable at the election of the party sought to be charged, and such election must, of course, be manifested in some affirmative way. While there is no question but that the better practice is to allege that the contract is in writing it is not necessary to the statement of the prima facie cause of action. Can the defense of the statute be raised by demurrer? We think that there should be a presumption in favor of the execution of the writing evidencing the contract, in the absence of allegations in the complaint expressly showing that it was an oral agreement. Paragraph 17 of section 334 of the Code of Civil Procedure establishes the presumption that the ordinary course of business has been followed; and as stated in Printup vs. Johnson (19 Ga., 73):
“If the agreement was such a one that it was required to be in writing by the statute of frauds, then it is to be presumed, until the contrary be shown, that the agreement was in writing; for it is, in general, to be presumed until something to the contrary be shown, that no man does what the law forbids, or what the law declares shall be invalid.” A late case from the same jurisdiction contains the following further remarks on this subject: “Where the statute, in derogation of the common law, requires certain contracts to be executed in a prescribed manner in order to be binding upon parties, the law will not presume, in the absence of proof, that either party has violated the statute.” (Draper, Moore & Co. vs. Macon Dry Goods Co., 103 Ga., 661.)
The rule that the contract is presumed to be in writing when so required by the statute of frauds and not specifically alleged to be in writing by the pleading is supported by many other well-considered cases. (Gale vs. Harp, 64 Ark., 462; Lupean vs. Brainard, 46 N. Y. S., 1044; Glayden vs. Ellison, 68 S. W., 715, Tex. Civ. App., 1902; Barnsdall vs. Waltmayer, 142 P., 415; Bradford Inv. Co. vs. Joost, 117 Cal., 204; Walker vs. Edmundson, 111 Ga., 454; Laybourn vs. Zinns, 92 Minn., 208; Speyer vs. Desjardins, 144 111., 641, 36 A. S. R., 473.) The rule is otherwise in Indiana, but this is due to a statutory enactment. (Horner vs. McConnell, 158 Ind., 280.) As a result of this presumption a pleading which merely fails to show that a contract relied upon is in writing is not susceptible to a demurrer based upon the statute of frauds, for the reason that a demurrer does not even dispute the facts alleged in the pleading to which it is directed, but admits them, together with the legitimate inferences flowing therefrom. That the defense of the statute cannot be raised by demurrer in the face of this presumption of the enforceability of the contract is also a doctrine which receives general assent. (Evans vs. Southern R. Co., 133 Ala., 482; Anderson vs. Hilton & D. Lumber Co., 121 Ga., 688; Fowler vs. Fowler, 204 III, 82; Phillips vs. Hardenburg, 181 Mo., 463; Alexander vs. Cleland, 13 N. M., 524 (1906), 86 P., 425; Matthews vs. Matthews, 154 N. Y., 288; Hennings vs. Doss, 125 N. C, 400; Tyson vs. Jackson Bros., 41 Tex, Civ. App., 128.) Where, however, the pleading shows on its face that the contract relied upon is oral and that it comes within the statute of frauds, the objection of the party sought to be charged may as well be taken by demurrer as by objection to the reception of evidence tending to prove its existence. When such a party proposes to thus offer the defense of the statute, it would prolong the action and subject both litigants to needless expense and waste of time to allow the case to proceed to trial. It would be a mere empty formality which would produce no better or different results than a decision on the demurrer, as in neither case could the contract be enforced. That the defense may be raised by demurrer when the pleading shows on its face that the contract relied upon is oral, is the approved doctrine as is evidenced by the following authorities: Thompson vs. New South Coal Co. (135 Ala., 630; 62 L. R. A., 551; 93 A. S. R., 49); Ahrend vs. Odiorne (118 Mass., 261; 19 Am. Rep., 449); Seamans vs. Barentsen (180 N. Y., 333; 105 A. S. R., 759); International Harvester Co. of America vs. Campbell (43 Tex. Civ. App., 421). An exception to this rule is where part performance is relied upon to take the contract out of the statute. (Dicken vs. McKinlay, 163 111., 318; 54 A. S. R., 471.) In the present case we find nothing in the complaint which indicates whether the contract relied upon is written or oral, although as stated above it is within the statute of frauds. In accordance with the above remarks relative to the manner of pleading the statute as a defense, it is clear that the demurrer to the complaint should have been overruled. The complaint states a cause of action and the case must proceed to trial. The judgment of the lower court sustaining the demurrer to the complaint is reversed, and the case remanded for further proceedings in accordance with this opinion. Without costs. Torres and Carson, JJ., concur. Johnson, J., concurs in the result. Arellano, C. J., dissents.