Introduction

In the Philippines, lease agreements are governed primarily by the Civil Code of the Philippines (Republic Act No. 386), specifically under Title VI, Chapter 2, which covers the lease of things (Articles 1642 to 1661). These provisions outline the rights and obligations of both lessors (landlords or property owners) and lessees (tenants) concerning the maintenance and repair of leased property. The obligations aim to ensure that the leased property remains habitable, functional, and suitable for its intended use throughout the lease term.

Maintenance and repairs are categorized into ordinary and extraordinary types, with responsibilities allocated based on the nature of the repair, the cause of deterioration, and any stipulations in the lease contract. While the Civil Code provides the default rules, parties can modify these through mutual agreement, provided such modifications do not violate public policy or mandatory laws. Additional regulations may apply under special laws, such as Republic Act No. 9653 (Rent Control Act of 2009) for residential units in certain areas, or local building codes enforced by the National Building Code of the Philippines (Presidential Decree No. 1096).

This article comprehensively explores the legal framework, distinctions between repair types, specific obligations of lessors and lessees, remedies for non-compliance, and relevant jurisprudence to provide a thorough understanding of the topic.

Legal Framework Governing Lease Obligations

The foundational law is the Civil Code, which defines a lease as a contract whereby one party (lessor) binds himself to grant the enjoyment or use of a thing to another (lessee) for a specified period and price (Article 1643). Obligations for maintenance and repairs stem from the principle of mutual benefit and the lessor's implied warranty that the property is fit for its purpose.

Key articles include:

Article 1654: Outlines the lessor's primary obligations, including delivering the leased property in a condition suitable for use and making all necessary repairs during the lease to maintain it in that state.
Article 1657: Details the lessee's duties, such as using the property diligently and paying expenses for its preservation in the manner agreed upon or according to custom.
Article 1660: Addresses urgent repairs, allowing the lessee to undertake them if the lessor fails to do so, with reimbursement rights.

These are supplemented by:

Republic Act No. 9653 (Rent Control Act): Applies to residential units with monthly rent not exceeding PHP 10,000 in Metro Manila or PHP 5,000 elsewhere (as of extensions up to 2023). It reinforces lessor obligations for habitability but does not alter core repair duties.
National Building Code (PD 1096): Mandates compliance with safety standards; violations can trigger repair obligations or lease termination.
Local Government Code (RA 7160): Empowers local units to enforce ordinances on property maintenance, such as sanitation and structural integrity.
Consumer Protection Laws: Under the Consumer Act (RA 7394), lessees may seek remedies if the property is defective.

Contracts of lease must be interpreted in good faith (Article 1305, Civil Code), and any ambiguity is construed against the party who caused it (Article 1377).

Distinction Between Ordinary and Extraordinary Repairs

Philippine law distinguishes repairs based on their nature, cause, and cost, which determines liability:

Ordinary Repairs: These are minor, routine fixes arising from normal wear and tear or daily use. Examples include repainting walls due to fading, fixing leaky faucets, replacing light bulbs, or minor plumbing adjustments. They are typically inexpensive and do not involve structural changes.
Extraordinary Repairs: These are major, unforeseen, or necessary for the property's preservation. They may result from fortuitous events (e.g., typhoons, earthquakes) or inherent defects. Examples include roof replacement after storm damage, structural reinforcements, or major electrical rewiring. If caused by the lessee's negligence, the lessee may bear the cost.

The Supreme Court has clarified this in cases like D.M. Consunji, Inc. v. Court of Appeals (G.R. No. 137873, 2001), emphasizing that the classification depends on the repair's purpose and extent, not just cost.

Lessor's Obligations for Maintenance and Repairs

The lessor bears the primary responsibility for ensuring the property's suitability, as per Article 1654(2): "To make on the [leased property], during the lease, all the necessary repairs in order to keep it suitable for the use to which it has been devoted, unless there is a stipulation to the contrary."

Key Obligations:

Necessary Repairs: The lessor must perform all repairs essential to maintain the property's fitness for its intended purpose. This includes structural integrity, plumbing, electrical systems, and appliances provided in the lease.
Extraordinary Repairs: Generally borne by the lessor, especially if due to natural causes or pre-existing conditions. For instance, if a typhoon damages the roof, the lessor must repair it promptly.
Urgent Repairs: If repairs are urgent and the lessor delays, the lessee may perform them and seek reimbursement (Article 1660). Urgency is determined by whether delay would cause irreparable harm or render the property unusable.
Warranty Against Hidden Defects: Under Article 1653, the lessor warrants against hidden defects that render the property unfit. If discovered, the lessee can demand repairs, rent reduction, or termination.
Compliance with Laws: The lessor must ensure the property meets building codes, health standards, and zoning laws. Failure can lead to mandatory repairs or fines.

In residential leases under rent control, lessors cannot shift major repair costs to lessees via contract clauses.

Exceptions:

If the lease stipulates that the lessee assumes repair duties (e.g., "as-is" clauses), this is valid but must be explicit and not cover habitability issues.
Deterioration due to lessee's fault shifts liability to the lessee (Article 1661).

Lessee's Obligations for Maintenance and Repairs

The lessee must act as a "diligent father of a family" (Article 1657), implying reasonable care.

Key Obligations:

Ordinary Repairs and Maintenance: The lessee pays for and performs routine upkeep, such as cleaning, minor fixes, and preventing deterioration through proper use. This includes garden maintenance in leased homes or office cleaning in commercial spaces.
Notification of Needed Repairs: The lessee must promptly notify the lessor of any need for extraordinary repairs (Article 1659). Failure to do so may make the lessee liable for aggravated damages.
Preservation of Property: Avoid alterations without consent (Article 1678) and return the property in the same condition, minus normal wear (Article 1667).
Liability for Damages: If damage results from the lessee's negligence, misuse, or sublessees' actions, the lessee bears repair costs (Article 1658).

In commercial leases, lessees often negotiate broader maintenance roles, but defaults revert to Civil Code rules.

Remedies for Breach of Obligations

For Lessees:

Demand Performance: Sue for specific performance to compel repairs.
Rent Suspension: If the property becomes uninhabitable due to lessor's neglect, rent may be suspended (Article 1658).
Damages: Claim actual damages, including relocation costs or lost business.
Lease Termination: Rescind the contract if breaches are grave (Article 1659).
Reimbursement: For self-made urgent repairs.

For Lessors:

Eviction: For non-payment of rent or property damage (under ejectment rules, Rule 70, Rules of Court).
Damages: Recover repair costs if due to lessee's fault.
Injunction: Prevent unauthorized alterations.

Disputes are resolved via barangay conciliation for amounts under PHP 200,000 (RA 7160), then courts. The Housing and Land Use Regulatory Board (HLURB) handles some residential disputes.

Relevant Jurisprudence

Philippine courts have elaborated on these obligations through key decisions:

Sps. Anastacio v. Planters Development Bank (G.R. No. 170884, 2010): Held that lessors must bear extraordinary repairs from fortuitous events, unless stipulated otherwise.
Chieng v. Santos (G.R. No. 169647, 2007): Clarified that lessees are not liable for pre-existing defects; lessors must disclose and repair them.
Robles v. CA (G.R. No. 128053, 2001): Emphasized prompt notification by lessees; delay can bar reimbursement claims.
Duldulao v. CA (G.R. No. 106427, 1993): Ruled that "necessary repairs" include those for safety and habitability, non-compliance justifies termination.

These cases underscore the balance between contractual freedom and protective policies for lessees.

Special Considerations in Different Lease Types

Residential Leases: Stronger protections under rent control; lessors cannot evict for refusing unfair repair shifts.
Commercial Leases: More flexible; parties often allocate repairs via detailed contracts, but Civil Code fills gaps.
Agricultural Leases: Governed by agrarian laws (e.g., RA 3844), where tenants handle ordinary maintenance, but landowners provide infrastructure.
Subleases: Sublessees' obligations mirror the main lease, with the original lessee liable to the lessor.

Conclusion

Lease agreement obligations for maintenance and repairs in the Philippines promote equitable distribution of responsibilities, ensuring property preservation while protecting parties' interests. Lessors handle major and necessary fixes to uphold habitability, while lessees manage routine care. Parties should draft clear contracts, document conditions via inventories, and seek legal advice for disputes. Compliance not only avoids litigation but fosters sustainable leasing relationships. For specific cases, consulting a lawyer or relevant authorities is advisable, as laws may evolve through amendments or court interpretations.