Philippine civil-law framework; designed for landlords, tenants, HR/Admin, and property managers. This is general information and not a substitute for tailored legal advice.
1) Is an unwritten (oral) lease valid?
Yes. A lease may be formed verbally or by conduct (e.g., moving in and paying rent). Consent, a definite object (the premises), and a cause (rent) are enough to create a binding agreement.
But enforcement has limits under the Statute of Frauds:
- An oral lease for more than one year is generally unenforceable in court unless there is partial/performed execution (e.g., possession accepted, rent paid/received), which usually removes it from the Statute.
- If the term is one year or less, oral agreements are typically enforceable.
Practical effect: courts will look at possession, receipts, bank transfers, chat/email trails, IDs, move-in inspection photos, and witnesses to supply or infer terms.
2) No fixed term? How courts imply the term and renewals
When the lease doesn’t specify a term, the law infers the period from the rent period:
- Pay monthly → presumed month-to-month lease.
- Pay weekly → week-to-week; daily → day-to-day, etc.
Courts may also fix a “reasonable period” based on the nature of the premises and usage. If the tenant stays and the landlord keeps accepting rent after the term, an implied renewal (tacit reconduction) arises on the same rent period basis (often month-to-month).
Termination of a no-term or month-to-month lease generally requires prior written notice aligned with the rent period (e.g., a full 30 days for a monthly tenancy), unless a different notice period is clearly proven by practice or agreement, or a rent control rule prescribes a longer lead time.
3) Key rights and duties (even without a written lease)
Landlord (lessor)
- Deliver the premises and ensure peaceful/legal possession.
- Maintain the property in a tenantable condition; handle major repairs not caused by the tenant.
- Respect the tenant’s privacy; entry is for legitimate purposes (repairs, inspections) at reasonable times or in emergencies.
- Return the deposit (if any) after lawful deductions (unpaid rent, documented damages beyond normal wear, utilities).
Tenant (lessee)
- Pay rent on time and use the premises with due diligence.
- Minor/ordinary repairs caused by the tenant’s fault are for the tenant; report major issues promptly.
- No sublease or assignment without the landlord’s consent if consent is required (consent may be implied from consistent tolerance).
- Return the premises at lease end in substantially the same condition, subject to ordinary wear and tear.
Utilities and improvements
- Utilities: clarify who contracts and pays. In disputes, meter readings, bills, and payment histories matter.
- Improvements: absent a contrary agreement, a tenant may remove improvements if removable without damage; if left in place, compensation isn’t guaranteed unless agreed.
4) Security deposits, advances, and receipts
- The Civil Code doesn’t set a universal cap on deposits, but rent-control rules (when applicable) and fair practice do influence reasonableness. Two months’ deposit and one month advance are common in practice.
- Landlords should issue receipts for every payment (rent, deposit, utilities, penalties) and keep a running statement.
- Deductions from deposits must be itemized and supported (photos, inspection reports, invoices). Keeping deposits commingled with personal funds increases dispute risk.
5) Rent increases and changes to terms
Without a written lease:
- During a fixed term (even if oral), unilateral increases don’t take effect until the term ends, unless the tenant clearly agrees.
- For month-to-month, the landlord may propose a new rent effective after proper written notice for at least one rent period, subject to any rent control limits then in force.
- Silence + continued payment/acceptance at the new rate can evidence agreement. Prompt written objection preserves the status quo while the parties negotiate—or the tenancy ends after proper notice.
6) Grounds to end the tenancy or evict (summary)
Common lawful grounds (always check any applicable rent-control rules that may narrow/condition these):
- Expiration of the agreed or implied term with proper notice.
- Non-payment of rent or utility charges that the tenant is obliged to pay.
- Breach of material conditions (e.g., unauthorized sublease, illegal use, dangerous alterations, nuisance).
- Necessity of the owner to use the property (often subject to advance notice and good-faith requirements in rent-controlled settings).
- Major repairs or condemnation requiring vacancy.
Self-help eviction is illegal. No padlocking, pulling out doors/windows, cutting utilities, or intimidation. Always demand in writing first, then use lawful remedies.
7) The eviction process in brief (Rule 70 actions)
- Case type: Unlawful detainer (tenant initially had lawful possession but unlawfully withholds after demand) or forcible entry (possession taken by force, intimidation, threat, strategy, or stealth).
- Where: The first-level court (Metropolitan/Municipal Trial Court) where the property is located.
- When: Must be filed within one year from the last demand to vacate (unlawful detainer) or from the dispossession (forcible entry).
- Pre-condition: If parties live in the same city/municipality and are natural persons, Barangay conciliation is typically mandatory before filing, unless an exception applies (e.g., urgent legal action, the adverse party is a corporation, the parties live in different cities/municipalities, etc.).
- Reliefs: Restitution of possession, unpaid rents/reasonable compensation for use, attorney’s fees/costs, and sometimes immediate execution after judgment (subject to supersedeas bond and periodic deposits if appealed).
8) Evidence you’ll actually need (no written lease case)
For landlords
- Proof of ownership/authority (title, SPA, corporate authority).
- Identity of the tenant; move-in documents; receipts; rent ledger; messages/emails; photos/videos; neighbor affidavits.
- Demand letters (pay and/or vacate), with proof of service (personal service with signed acknowledgment, registered mail with registry receipts/return cards, or courier affidavits).
- Inspection reports and repair invoices.
For tenants
- Payment proofs (receipts, bank transfers, screenshots).
- Messages showing agreed rent, move-in date, promised repairs, permission to sublease/pets, etc.
- Photos/videos showing initial condition, repairs requested, and current state.
- Witnesses (neighbors, caretaker, broker).
9) Taxes, official receipts, and documentary stamp tax (DST)
- Landlords engaged in leasing should register with the BIR, issue official receipts, and account for income tax and any applicable VAT/percentage tax.
- Documentary Stamp Tax on leases applies and is typically based on total rent and term; collection usually occurs upon execution (for written contracts). If unwritten, assessment may arise when the lease is reduced to writing (e.g., addendum, renewal) or in audits—factor this into regularization.
- Corporate/large tenants may be required to withhold a percentage of rent and remit to the BIR (Expanded Withholding Tax). Clarify in writing who bears what.
10) Repairs, habitability, and rent withholding
- Tenants may demand essential repairs (e.g., structural, plumbing, electrical) that are the landlord’s legal responsibility.
- If the landlord unreasonably refuses, the tenant may, in narrowly defined situations, advance the cost of urgent necessary repairs and charge it against rent, provided there is proper notice, documentation, and receipts. Misuse of this remedy risks eviction for non-payment—proceed carefully and document thoroughly.
11) Special contexts
- Boarding houses/bedspaces/condo rooms: House rules are enforceable if reasonable, lawful, and clearly communicated. Fire/safety and condo/by-laws may add obligations beyond the Civil Code.
- Commercial leases: Parties enjoy greater freedom of contract; however, consumer protection, zoning, fire/sanitary, and building codes still apply.
- Rent control coverage (when in force): May cap increases, condition evictions, require longer notices, or mandate advance filing/clearances in some LGUs. Always check the current nationwide and local issuances that might apply to your unit’s rent level and classification.
12) Common pitfalls (and how to avoid them)
- “Handshake only.” → At minimum, exchange an email or message thread summarizing rent, due date, deposit, utilities, house rules, notice periods.
- No receipts. → Always issue/ask for receipts; for bank transfers, add clear references (e.g., “Unit 3B July 2025 Rent”).
- Vague notice. → Use a dated, written demand that states breach, amount due, and deadline, plus clear vacate date if warranted; keep proof of service.
- Self-help eviction. → Never padlock or cut utilities; it backfires legally.
- Deposit misunderstandings. → Spell out permitted deductions and a timeline for refund after move-out inspection.
- Sublease confusion. → Decide if allowed/forbidden; if allowed, require disclosure and KYC of subtenants.
- Owner’s use evictions. → Observe good faith, proper notice, and any rent-control safeguards.
13) Suggested clause set (to regularize an oral lease in one page)
If both sides are willing to “paper” the relationship, a simple Memorandum of Lease Terms can confirm:
- Parties; unit description; start date; term (or month-to-month); rent amount/due date/place/mode.
- Deposits/advances; permitted deductions; interest/penalties (if any).
- Utilities responsibility; repair allocations; inspection/entry protocol.
- House rules (pets, noise, smoking, visitors, alterations).
- Sublease/assignment consent policy.
- Notice periods for rent changes and termination.
- Grounds for ejectment consistent with law; venue and barangay conciliation acknowledgment.
- Taxes/withholding/DST allocation.
- E-signatures and acknowledgment that earlier oral terms are merged into the memo.
Even a short memo dramatically reduces litigation risk.
14) Quick checklists
For landlords
- Verify ownership/authority; register for tax if required.
- Take move-in photos; conduct inventory; collect and receipt deposits.
- Keep rent ledger; acknowledge repair requests; document responses.
- Use proper demand letters with proof of service.
- Observe notice rules (and any rent control requirements) for increases/termination.
For tenants
- Keep all receipts and message threads.
- Report issues in writing; photograph defects.
- Clarify sublease, pet, and alteration rules before acting.
- Before move-out, request a joint inspection and itemized deposit accounting.
15) Bottom line
- Oral leases are valid—but harder to prove and police.
- If the term is unclear, the law defaults to the rent period (commonly month-to-month) and requires proper written notice to change rent or end the tenancy.
- Evictions are done through lawful demand and court (after barangay conciliation where applicable)—never by self-help.
- Rent control, when applicable, overlays stricter caps, notices, and grounds—always verify current coverage for your unit.
- A one-page memo confirming the essentials can save both sides months of stress and expense.