Equatorial Realty Development Inc. vs. Mayfair Theater
FACTS: Carmelo owned a parcel of land with two 2-storey buildings located at Claro M Recto Avenue, Manila. The said building is leased to Mayfair specifically the portion of the 2nd floor, the two spaces at the ground floor and the mezzanine area. Based on their contract, it stated that,
That if the LESSOR should desire to sell the leased premises, the LESSEE shall be given 30-days exclusive option to purchase the same.
In the event, however, that the leased premises is sold to someone other than the LESSEE, the LESSOR is bound and obligated, as it hereby binds and obligates itself, to stipulate in the Deed of Sale hereof that the purchaser shall recognize this lease and be bound by all the terms and conditions thereof.
Carmelo informed the President of Mayfair they were selling the entire Claro M. Recto property and a certain Mr. Araneta was offering to buy the whole property and asked if Mayfair was willing to buy the property. Mayfair send a letter to Carmelo, to which the latter did not reply. On their second letter Mayfair informed Carmelo off their interest in acquiring the entire building and other improvements if the price is reasonable.
Four years later, Carmelo sold its entire property, which included the leased premises of Mayfair, to Equatorial.
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