Evicting a Tenant After the Security Deposit Is Exhausted and Rent Remains Unpaid
(Philippine Law & Procedure, updated to 19 May 2025)
1. Governing Sources of Law
| Source | Key Points |
|---|---|
| Civil Code (Arts. 1654–1669, 1673) | Lays out the lessor’s right to eject for non-payment, how deposits are treated, and the requirement of prior demand. |
| Rules of Court, Rule 70 (“Ejectment”) | Provides the summary procedure for unlawful detainer and forcible entry cases before first-level courts. |
| Republic Act 9653 (Rent Control Act, as amended) | Caps deposits (≤2 months’ rent) and sets notice periods; applies only to residential units whose monthly rent does not exceed ₱15,000 (in Metro Manila) or ₱7,000 elsewhere. |
| Katarungang Pambarangay Law (Pres. Decree 1508; now Ch. VII, LGC 1991) | Requires prior barangay mediation when both parties reside in the same barangay or in adjoining barangays within the same city/municipality. |
| Special Rules (COVID-19 moratoria, local ordinances) | Most pandemic-era moratoria have expired; check ordinances for any lingering extensions. |
Practical takeaway: Non-payment is a recognized ground for eviction once the deposit has been applied and exhausted provided the landlord first makes the proper demand to pay or vacate.
2. Security Deposits in Philippine Leases
Nature. A security deposit is not advance rent; it serves as collateral for unpaid obligations and property damage (Art. 1654).
Maximum amount. Under RA 9653, residential landlords may collect up to two (2) months’ rent plus one month advance.
Manner of application.
- During the lease, a landlord may not unilaterally declare the deposit “forfeited” and still demand rent for the same period; the deposit must be applied first, thereafter the tenant must replenish or vacate.
- Upon termination, any unused balance must be returned within 30 days or a reasonable period absent an agreement.
Once the deposit is fully applied against rent, further occupancy becomes unpaid tenancy—triggering the ground for unlawful detainer.
3. Three-Step Pre-Litigation Playbook
| Step | Why It Matters | Minimum Content / Form | Pitfalls |
|---|---|---|---|
| A. Accounting Notice | Documents exhaustion of the deposit. | Running statement of unpaid rent, penalties, repairs set-off. | Skipping this makes later claims for deficiency harder. |
| B. Formal Demand (“Pay or Vacate”) | Required by Art. 1673 & Rule 70. | (a) Pay total arrears within 15 days (30 days for land leases) OR (b) vacate. | Demand must be served personally or by registered mail with proof of receipt; avoid vague dates (“ASAP”). |
| C. Barangay Mediation | Jurisdictional prerequisite if parties live in same barangay/city. | Bring demand letter & lease; Lupong Tagapamayapa issues Certification to File Action if unsettled after 15 days (30 days if parties agree). | Failure to undergo KP conciliation is a ground for dismissal. |
Tip: Keep originals of all notices and registry receipts; these become Exhibits later.
4. Filing an Unlawful Detainer Case
| Item | Details |
|---|---|
| Court | Metropolitan / Municipal Trial Court (MTC) where property is located. |
| When to file | Within 1 year from the last demand to vacate (Rule 70, Sec. 1). |
| Pleadings | ➤ Complaint (verified) + Certification against Forum Shopping. ➤ Attach lease, demand letters, barangay certification. |
| Docket & fees | Based on unpaid rents + damages; expect ₱ 4,000–10,000 for most residential cases. |
| Summary Procedure | (1) Complaint → (2) Answer (10 days) → (3) Position Papers → (4) Judgment (30 days) — no exhaustive trial unless the judge requires. |
| Bonded stay | Tenant may stay execution by filing a supersedeas bond + depositing current rentals within 10 days from judgment. |
| Execution | If no appeal or bond, judgment becomes final; sheriff issues writ of demolition/possession. |
5. Damages & Recoverables
- Back rent up to time of actual court-awarded possession.
- Legal interest (6% p.a. unless stipulated) on unpaid rent starting from demand.
- Attorney’s fees (if provided in lease or when tenant’s obstinacy compels litigation).
- Liquidated damages / Penalties only if clearly stipulated and not unconscionable.
- Costs of suit (docket, sheriff, publication if needed).
6. Common Defenses Tenants Raise—and Landlord Counter-Moves
| Tenant’s Defense | Typical Basis | Landlord Rebuttal |
|---|---|---|
| Deposit still covers rent | Claim of misapplied or inflated charges. | Present detailed accounting & receipts showing zero balance. |
| No valid demand received | Demand served on wrong address or by SMS only. | Show personal service or registry receipts + affidavit of server. |
| Defective notice period | Less than 15 days. | Confirm dates; if off, re-issue demand to cure. |
| COVID emergency laws | Invokes Bayanihan laws or local moratoria. | Cite sunset clauses; most national rent moratoria ended 31 Dec 2022. |
| Lease renewal / verbal waiver | Landlord accepted late payments. | Argue tolerance ended on date of demand; possession now unlawful. |
7. Special Situations
| Scenario | Guidance |
|---|---|
| Commercial leases | Rent Control Act does not apply; parties largely bound by contract, but ejectment still through Rule 70. |
| Boarding houses / bedspaces | Covered by RA 9653 if within rent threshold; multiple occupants complicate service—serve each occupant if individually named in contract. |
| Subleases | Landlord may eject head-tenant; sub-tenants fall with him under Art. 1656. |
| Condos / HOA restrictions | Check condo corp. by-laws for additional move-out protocols; these do not supersede statutory ejectment rights. |
| Abandoned unit | Secure barangay attestation, inventory belongings with barangay witness, change locks to avoid theft claims. |
8. Timeline Snapshot (Typical Residential Case)
- Day 0 – Rental due, unpaid.
- Day 31–60 – Deposit fully applied; landlord issues Accounting Notice.
- Day 61 – Formal Demand to pay/ vacate (15-day clock starts).
- Day 76 – Demand expires; file barangay complaint (if applicable).
- Day 91 – Barangay issues Certificate to File Action.
- Day 95 – Complaint filed in MTC.
- Day 125 – Answer/ position papers complete.
- Day 155 – Judgment.
- Day 165–175 – Writ of execution (if unopposed).
Real-world delays—docket congestion, appeals, sheriff availability—can add 3–6 months.
9. Practical Drafting Checklist
- ☐ Lease contains clear clause on deposit application & refund.
- ☐ Stipulate interest / penalties for late payment.
- ☐ Provide escalation clause (e.g., RA 9653 max 5% annual increase).
- ☐ Require tenant to keep updated mailing address / email.
- ☐ Include attorney’s-fees clause for litigation enablement.
10. Ethical & Business Considerations
- Litigation costs can exceed 6–8 months of rent—sometimes it is cheaper to negotiate a “cash-for-keys” exit.
- Maintain professionalism; harassment (cutting utilities, intimidation) may expose the landlord to criminal liability (RA 10951: unjust vexation, grave coercion).
- A detailed move-out inspection protocol protects both sides from spurious damage claims.
Bottom Line
A landlord in the Philippines may lawfully evict a tenant once the security deposit has been fully applied and the tenant still refuses to pay or vacate, provided the landlord:
- Issues a clear written demand to pay or vacate (15 days).
- Completes obligatory barangay mediation when required.
- Files a timely unlawful detainer action in the proper court within one year.
Compliance with these procedural steps converts a frustrating arrears situation into a winnable, enforceable judgment—while keeping the landlord on the right side of the law.
This material is for general information only and is not a substitute for personalized legal advice. For case-specific guidance, consult a Philippine lawyer admitted to practice.