• Where right of first refusal applies

    Persida Acosta

    Persida Acosta

    Dear PAO,
    My friend, Rina, has been renting on a monthly basis, for almost 15 years now, a house in Taguig City (Metro Manila) owned by Zulli. She learned from Zulli that he is selling the house and lot for two million pesos. Rina offered to buy the property, but Zulli did not give any answer.

    Rina found out later that the property was sold to Adrian. Rina insists that she has the right to buy the house before it can be offered to any other buyer or she has the right of first refusal pursuant to Presidential Decree 1517. Is she correct?

    Dear Farah,
    Presidential Decree (PD) 1517, specifically Section 6 thereof, provides:

    “Within the urban zones, legitimate tenants who have resided on the land for ten years or more who have built their homes on the land and residents who have legally occupied the lands by contract, continuously for the last ten years shall not be dispossessed of the land and shall be allowed the right of first refusal to purchase the same within a reasonable time and at reasonable prices, under terms and conditions to be determined by the Urban Zone Expropriation and Land Management Committee created by Section 8 of this decree.

    There are elements that should be considered in order that the above-mentioned provision of the law could be applied, to wit:

    a. Rented property must be located in an urban zone;

    b. Lessee must build his/her house on said land; and

    c. He/She must be renting the said property continuously for ten years.

    Section 6 of PD 1517 is not applicable to your situation, because it was not you who built the house on the rented lot. Such house was built by the landowner before you entered into a contract of lease with him. It follows then that the landowner does not have the obligation to offer you the property, if he intends to sell it, and you do not have the right of first refusal in the case at hand.

    We hope that we were able to answer your queries. Please be reminded that this advice is based solely on the facts you have narrated and our appreciation of the same. Our opinion may vary when other facts are changed or elaborated.

    Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to dearpao@manilatimes.net


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