SyQuia v. United States, 124 F. Supp. 638

124 F. Supp. 638 | Ct. Cl. | 1954

LittletoN, Judge,

delivered the opinion of the court:

Plaintiffs, citizens and residents of the Philippine Islands, owned three apartment buildings in the City of Manila, Philippine Islands. These buildings were leased to defendant in 1945 for “the duration of the war and six months thereafter,” unless sooner terminated by defendant. This suit is brought to recover the difference between the rental specified in the leases, which was paid to plaintiffs by defendant, and the alleged reasonable rental value of the buildings, during the period between the alleged term of the leases with defendant and the release of the properties by defendant, in 1948. Plaintiffs’ petition is in the alternative, the allegations being that the leases terminated: (1) six months after August 14, 1945, the end of hostilities; (2) six months after September 1, [sic] 1945, the formal surrender of Japan; or (3) six months after May 11,1946. The amounts claimed on the basis of the various alternatives are, respectively: (1) $200,750; (2) $189,800; or (3) $178,850.

The sole issue presently presented at this stage of the case is the meaning of the term “the duration of the war” as used in the lease agreements. Plaintiffs contend that this phrase means the duration of actual hostilities. Defendant asserts that it means a period terminated by formal peace treaty or similar political act, and that the properties were, therefore, returned to plaintiffs long before the termination of the “war” by treaty.

After plaintiffs had completed the presentation of their evidence, defendant moved to dismiss plaintiffs’ petition pursuant to Eule 49 (b) [now Eule 49 (c) ] on the ground that upon the facts and the law plaintiffs had shown no right to recover.

The evidence shows that plaintiffs owned three apartment buildings in the City of Manila. February 25, 1945, two days after organized resistance by Japanese troops in Manila had ceased, plaintiffs, who had previously evacuated from their apartments to an area free from combat as the battle for Manila progressed, secured permission from the military authorities to visit the apartment buildings, prior to the date they were rented to. defendant. Plaintiffs found that the buildings had been extensively damaged, that looting had occurred, and that U. S. soldiers were occupying the apartments.

In response to an inquiry by plaintiffs, the Army Provost Marshal advised them that it was not possible to post guards on private property, but he suggested that if the apartment buildings were leased to the Army, the Army would post guards to prevent looting and damage. Plaintiffs decided to lease the properties to the Army to protect them from looting, and thereafter offered to lease the buildings to defendant.

On February 27 or 28, 1945, plaintiffs and an agent of defendant inspected one of the buildings, and on March 7, 1945, executed a lease for this building “for the period of the war and six months thereafter,” with defendant to pay “as rental the fair present rental value of the property as determined by competent authority.” On March 23, 1945, plaintiffs and an agent of defendant inspected the other two buildings and executed leases therefor with these same provisions.

On July 8, 1945, for two of the buildings, and on August 7,1945, for the third building, plaintiffs and defendant executed leases superseding the earlier ones. These leases, containing specified rentals, were made retroactive to the date of the earlier leases, and extended therefrom “for the duration of the war and six months thereafter,” unless sooner terminated by defendant.

These leases were on printed forms supplied by the defendant, the printed portions of which included the phrase “for the duration of the war and six months thereafter.” At the time the leases were entered into and executed, neither plaintiffs nor defendant’s contracting officer or any other agent of defendant discussed the phrase above quoted. Plaintiffs now contend, and testified, that it was their understanding that the phrase referred to actual hostilities and they contend that the evidence taken before the Commissioner tends to establish the truth of that contention. For the reasons hereinafter stated we agree with the position taken by plaintiffs.

Toward the end of the year 1945, after hostilities had ceased, officers billeted in the buildings were notified by defendant to vacate them. Plaintiffs then expected that the buildings when so vacated would be returned to them. However, defendant made further repairs to the buildings and thereafter used them to house officers’ families, a use for which the buildings had not been originally leased.

Sometime early in 1946, plaintiffs requested that the buildings be returned to them, insisting that the leases had, by their terms, expired six months after V-J Day. This request, made in March 1946, was denied by defendant. Plaintiffs then made efforts to secure increased rentals from defendant, but without success.

In a letter dated May 11,1946, after the plaintiffs’ request that the apartment buildings be returned to them had been turned down, plaintiffs sought a “renegotiation” of the leases, based “on the announced intention of the Army to continue to occupy them for the officers’ families.” Plaintiffs were informed that a contract could not be altered to the detriment of the Government, but that vacation of the properties prior to February 1, 1947 was contemplated.

On June 28, 1946, plaintiffs requested cancellation of the leases and that the apartments be returned to them. On July 31, 1946, defendant then advised plaintiffs that it planned indefinite use of the buildings, and that they could not be released at that time. Further efforts on plaintiffs’ part to end the leases or secure higher rentals from defendant, or to have the buildings returned to them by the Army, were also unsuccessful.

On February 17,1947, plaintiffs served formal notice upon the then Commanding General in the Philippines, the then Chief of the Beal Estate Division in the Engineer’s Office, and the 64 occupants of the apartment buildings, to cancel the leases, to increase the rental, and either to execute new leases or release the apartments within thirty days thereafter-This failing, an action of unlawful detainer was instituted by plaintiffs against these parties in the Municipal Court of Manila. That court found that the war between the United States and her allies and Germany and Japan had not terminated, that the terms of the leases had not expired, and that the United States, the real party in interest, conld not be sued in the courts of the Philippines without its consent. On appeal, the Court of First Instance of Manila affirmed the decision on the jurisdictional ground, as did the Supreme Court of the Philippines, to which a further appeal was taken by plaintiffs.

On January 12, 1948, plaintiffs were notified that the buildings would be vacated as soon as it was practicable to do so, and formal notices of cancellation were served on p1a.int.iffs, stating that the three buildings would be released on or about February 29, March 31, and May 31, 1948, respectively. The buildings were vacated on or before the specified dates, and the accrued rentals were thereafter paid to and received by plaintiffs, who accepted them under protest.

Defendant contends, in support of its motion to dismiss, that the term “duration of the war” as used in the leases in question meant a period terminated by peace treaty or similar political act, and that to construe the phrase otherwise there must be some manifestation, absent here, that the parties contracted with the intent to give the phrase a different meaning.

Most of the cases relied on by defendant to support this contention have to do with the construction of Federal statutes containing a grant of power to the Government as a Sovereign or to some agency thereof, for the “duration of the war” and six months. In interpreting those statutes the courts have held that the powers so granted continue until six months after the signing of the formal peace treaty or some other equivalent foliticdl act. These decisions, however, have been held not applicable¹ to cases involving the interpretation of contracts and leases containing similar or identical phrases defining the period for which they were to remain in effect.

When a lease of real estate or a contract contains a provision that the tenancy or performance is to continue “for the duration of the war,” “until the conclusion of the war,” “until the end of the war,” and even “until the final treaty of peace has been signed,” the majority of courts have held that in the absence of evidence that a different meaning was assigned to the phrase by both parties, such phrases are to be interpreted as they are commonly understood by laymen, and that such commonly understood meaning is “until actual hostilities have ceased.” The practical effect of these decisions has been that in cases involving leases containing such phrase the courts have held that there is a presumption that the parties intended the leases to last only until the cessation of actual hostilities and for whatever additional definite period is provided for in the leases.

In most of the cases which have come to our attention the court has not found the presumption to be successfully rebutted even where one party’s evidence tending to establish a contrary intention remained unrefuted. La Jolla Casa Le Manana v. Hopkins, 98 Cal. App. 2d 339, 219 P. 2d 871 (1950). In the La Jolla case, the defendant entered into a contract of sale of her hotel to plaintiff’s predecessor, a Mr. White. The contract of sale provided that the seller might continue to occupy a cottage on the hotel property “for the duration and until she can reasonably build a home for herself-” It also provided that if the seller was unable to build a house for herself within a year and a half after “the termination of the present war,” because of the continuation of building restrictions or because of unreasonable prices, the seller would then pay the buyer rent at the rate of $150 a month. A year and a half after the unconditional surrender of the Japanese on September 2, 1945, the buyer made demand on the seller for possession of the cottage under the terms of the contract of sale. Upon the seller’s refusal to vacate, contending that the “war” would not be over until a formal treaty of peace was signed, the owners sought a declaratory judgment that the “war,” in the sense used in the contract, meant actual hostilities. The seller and the lawyer who had represented her in negotiating the sale, both testified to the effect that the seller had intended the phrases “for the duration” and “the termination of the present war” to mean “until the signing of a formal peace treaty” and that such intention had been communicated to and understood by the buyer, The original buyer was dead at the time of the declaratory judgment suit and plaintiff was unable to present any evidence to refute that of the defendant. The court held that the ordinary meaning of terms such as “duration of the war” when used in contracts and leases, was the duration of actual hostilities. In the court’s opinion, the presumption that the parties had used the phrases in such ordinary sense was not overcome by the testimony to the contrary of the seller and her lawyer. The court concluded that the buyer was entitled to a declaratory judgment favorable to its contention that the phrases concerning the “war” referred to “actual hostilities.”

In Rupp Hotel Operating Co. v. Donn, 158 Fla. 541, 29 So. 2d 441 (1941), the court held that phrases such as “conclusion of the war,” “duration of present world war,” and “conclusion of duration” used in contracts and leases, refer to actual hostilities and not to a technical state of war terminated only by a political act such as a formal peace treaty. In Colonial Hotels, Inc. v. Maynard, 158 Fla. 318, 29 S,o. 2d 28 (1946), the court held that a lease to run until “the termination of war” and until “an armistice has been signed between the United States of America and all nations with which it may at such time be at war,” would terminate at the end of hostilities marked by the unconditional surrender of the axis powers. The court noted that no armistice had in fact been signed or would be, in view of the unconditional surrender. In Samuels v. United Seamen's Service, Inc., 68 F. Supp. 461, the lease provided that the term should extend for a period of six months “from and after the cessation of hostilities in the present war with Japan.” The subsequent controversy concerned the question whether the phrase “cessation of hostilities” referred to the end of actual hostilities, or to the date of a presidential or congressional declaration that hostilities had ended. Such a formal declaration was made on December 31, 1946. The court held that the lease could not be said to terminate until there was a formal governmental determination of the cessation of hostilities. The Circuit Court of Appeals reversed, 165 F. 2d 409, holding that such phrases in leases are to be construed in their ordinary sense and that the ordinary sense of a phrase such as “cessation of hostilities” was the actual cessation of hostilities rather than a presidential proclamation of a fact long since accomplished. The court held also that such cases as Hamilton v. Kentucky Distilleries & Warehouse Co., 251 U. S. 146, and Bowles v. Soverinsky, 65 F. Supp. 808, having to do with the time during which governmental war powers remain in existence, are not apposite to the cases involving the interpretation of leases and contracts.

In Ehrlich v. Barbatsis Holding Co., 63 So. 2d 911 (Fla.) (1953), the lease provided that the tenant could have the property during the continuance of the war “now being waged between the United States of America and its Allies against the so-called ‘Axis Nations’ and for six months after the final treaty of peace has been signed.” Later in the same lease it was provided that the lessee would immediately yield up possession of the premises “at the termination of this Lease by termination of the war, or otherwise.” No facts or circumstances outside the terminology of the lease were considered by the court, the parties resting upon the express language of the lease. After noting with disapproval the New York decisions holding such leases constitute tenancies at will, the Florida court held that the reference to a “treaty of peace” in the lease under consideration did not mean that the parties intended to contract with reference to a formal peace treaty resulting from international negotiations for the consummation of which neither party could be responsible. Without holding on what precise date the lease had expired, the court held that at the time of the filing of the suit, the lease had clearly expired although at that time no treaty of peace had been signed.

In Girdler Corporation v. Charles Enew Johnson & Co., 95 F. Supp. 713, aff'd. 194 F. 2d 533, the court was asked to interpret a phrase in a contract providing that the Johnson Co., the nominee of Defense Plant Corporation, might use plaintiff’s carbon black process until six months after the date of the “cessation of hostilities.” The Johnson Co. contended that the “cessation of hostilities” referred to did not occur until December 31, 1946, the date of the presidential proclamation of the cessation of hostilities. As in the case of Samuels v. United Seamen's Service, supra, the Circuit Court held that in contracts between private parties the phrase in question and others like it have been held to refer to the end of actual hostilities on September 2, 1945 and that the fact that the United States, through Defense Plant Corporation was a party to this contract made no difference since the courts would not apply a different rule because the Government was a contracting party, citing United States v. Standard Rice Co., Inc., 323 U. S. 106.

In Burger v. Employees' Retirement System et al., 101 Cal. App. 2d 700, 226 P. 2d 38 (1951), the California court was asked to interpret a local statute which provided that during the existing war between the United States and the Axis powers, and for six months after the termination of said war, the provisions of a certain municipal statute would be suspended. The suspended law required that the pensions of retired municipal employees should be reduced by any amounts such employees earned from private employment. The court noted that the war-time act suspending the old law was enacted by vote of the electorate, and the court held that when the voters cast their votes they understood the phrase “during the existing war * * * the termination of said war” in the popular and ordinary sense of the duration of hostilities and the termination of hostilities rather than in the technical sense of the signing of a formal treaty of peace.

In the cases referred to above, the party urging that the phrase such as “duration of the war” meant the duration of actual hostilities, was not required to establish the fact that such meaning had been intended beyond proving the use of those words in the lease or contract. On the other hand, in none of the cases was the court impressed by opinion evidence offered that the phrase was intended to mean that the lease of contract was to continue until a formal treaty of peace was signed. The Circuit Court in the Samuels case, supra, indicated that unless the lease itself provided for termination on the happening of some official political action, the court would presume the parties intended termination of the agreement upon the termination of actual hostilities. In most of the cases the courts have strongly indicated an unwillingness to believe that parties to an ordinary business transaction, such as leases, etc., would knowingly agree to a term of performance as obviously lengthy and indefinite as one to end with the signing of a formal peace treaty. In deciding that the war ended in the common acceptation of that term upon the termination of actual hostilities for the purpose of interpreting the performance time of leases and contracts, the courts have not been making a determination of when the war ended as a political matter, or in a political sense, but rather when it was reasonable to" assume that the period of contract performance had ended.

In Grundstein v. Suburban Motor Freight, Inc., 107 N. E. 2d 366, 92 Ohio App. 181 (1951), cited by defendant, the tenant, in 1942, had leased certain real estate from the owner for “the duration of the present war and six (6) months thereafter, * * *” with an option to purchase at any time during the term of occupancy. In the late summer of 1947, the owner wrote to the tenant requesting him to make some repairs to the premises. On October 27, 1947, the owner conveyed the premises, and executed an assignment of the lease, to the new owner. The tenant thereafter paid rent to the new owner up to January 31, 1950. On December 6, 1949, the new owner served on the tenant a notice to vacate the premises, and on December 27, notified the tenant that the rent on and after February 1, 1950, would be at an increased rate. On January 5, 1950, the tenant notified the landlord that it was exercisng its option to purchase. In the subsequent litigation, both parties agreed that the words “duration of the present war” were ambiguous. The landlord contended that the words meant the continuation of hostilities, and that the lease had terminated in 1946; if so, the exercise of the option to buy by the tenant came too late. Under the principle that parol evidence is admissible to show the intention of the parties where there is an ambiguity, evidence was taken from which the court concluded that the trial court was justified in finding that the intention of the parties was that the lease was not to terminate until six months after a formal treaty of peace had been signed. The court further held that where words were susceptible of more than one meaning, that interpretation which the parties themselves had placed upon the words by their subsequent acts would be adopted, indicating, in the application of this principle, that the parties had twice recognized the continuing force and effect of the lease in 1947, long after the termination date claimed by the landlord.

This court had occasion to interpret the meaning of the phrase “duration of the war” in a contract between the United States and Breeze Burners, Inc.² At issue in that case was the period during which a patent license granted to the Government “for the duration of the present war” and six months thereafter, had been or was in effect. We held that the phrase had the usually accepted and understood meaning of “during the period of actual hostilities” and held that the license expired no later than six months after the Japanese surrender on September 2,1945.

We are of the opinion that the same rule should be applied to this case involving a lease negotiated by the Army officers of the United States and these plaintiffs. All of the facts and circumstances lead to that conclusion.

But defendant contends that at the close of plaintiffs’ case before a Commissioner of the court, the evidence offered by plaintiffs failed to establish that plaintiffs intended and understood the phrase “duration of the war” or “period of the war” to mean the duration or period of actual hostilities. As we read the cases dealing with this problem of interpretation, the courts have not required proof of the meaning of such phrases in leases beyond the lease itself, and the burden of showing that the phrase carried a meaning other than the one the courts have held to be its usual, common and ordinary meaning, has been on the party urging such meaning.

In the instant case, plaintiffs’ failure to prove conclusively by independent outside evidence, other than their testimony as to their understanding, that they intended the lease to terminate six months after the end of actual hostilities with Japan which occurred on September 2,1945, does not require the dismissal of plaintiffs’ petition under Rule 49 (c). In addition to what has been said we are of the opinion that the evidence before the court of the conduct of the parties during the period following the Japanese surrender was not consistent with an understanding that the leases were to remain in effect until a formal treaty of peace was signed, unless sooner terminated by defendant.

As the case now stands, plaintiffs are suing on leases which contained the phrase “duration of the war” to define the terms thereof, and in the absence of convincing proof that the parties were speaking of “war” in its political rather than in the sense of actual and open hostilities, the term of the leases ended no later than six months after September 2,1945, the date of the Japanese surrender to the United States.

The evidence of plaintiffs, although inconclusive as to the specific intention of both parties in using the phrase, does tend to support the conclusion that they were using the phrase in the usual manner of persons entering into a business contract. It is agreed that the parties did not discuss the phrase when the leases were negotiated. Within six months of the surrender of Japan, plaintiffs requested that the buildings be returned to them on the ground that the leases by their terms had expired. What was done by plaintiffs after defendant’s refusal to vacate in March 1946, merely represents various methods attempted by plaintiffs to regain possession of their buildings or secure leases from their unwelcome tenant at rentals comparable to the then rental scale after the war had actually ended.

The purpose of Rule 49 (c) is to permit, in cases where a plaintiff has been unable to establish a right to recover, a speedy dismissal of the action without necessitating the presentation of defendant’s evidence. If, on the other hand, a right to relief is made out by a plaintiff on the record as it stands at the close of plaintiff’s evidence, the case must be remanded to a Commissioner to afford defendant an opportunity to establish any defenses available to it. Howard Industries, Inc. v. United States, 126 C. Cls. 283.

Plaintiffs’ evidence establishes, prima facie, that the “duration of the war” as used in the leases with defendant did not extend beyond the time of the formal surrender of Japan on September 2, 1945, and that the leases consequently expired according to their terms not more than six months after that date.

Defendant’s motion to dismiss is accordingly overruled and the case is remanded to a Commissioner of this court for further proceedings not inconsistent with this opinion.

It is so ordered.

Laramore, Judge; MaddeN, Judge; Whitaker, Judge; and JoNEs, Chief Judge, concur.

FINDINGS OK FACT

The court, having considered the evidence, the report of Commissioner George H. Foster, and the briefs and argument of counsel, makes the following findings of fact:

1. The plaintiffs are citizens and residents of the Philippine Islands. Pedro SyQuia, Leopoldo SyQuia, and Gonzalo SyQuia, individually and collectively, hereinafter sometimes referred to as plaintiffs, and their mother who is not a party-plaintiff, owned the Michel Apartments, the “old” SyQuia Apartments, and the “new” SyQuia Apartments in the Malate district of the City of Manila, Philippine Islands.

2. On January 9, 1945, American troops began the liberation of the Island of Luzon with landings on the beaches of Lingayen Gulf; by February 3, the outskirts of Manila had been reached by the American troops; and, by February 23, organized resistance by the Japanese troops had ceased in Manila with the capture of the old Walled City.

On February 27, the Government of the Commonwealth of the Philippines was reestablished in Manila, and on that date, President Osmena, by Executive Order, restored the Executive Departments as they had existed prior to the Japanese occupation. On March 10, President Osmena, by Executive Order, declared that Manila had been freed from enemy occupation and control as of that date.

3. Plaintiffs who had evacuated from their apartments to an area free of combat as the battle for Manila progressed, secured permission on, or about, February 25,1945, from the military authorities to visit their apartments to determine what had happened to their properties. Plaintiffs found that the apartment buildings had been extensively damaged by the battle, that looting of the properties had occurred, and that soldiers were occupying the apartments.

Plaintiffs inquired of the soldiers at the apartments what steps could be taken to protect their property and if guards could be posted. Plaintiffs were referred to the Army Provost Marshal who advised plaintiffs that it was not possible to post guards on private property but suggested that if the apartments were leased to the Army, then the Army would post guards around the buildings to prevent looting.

4. Plaintiffs, after discussing the matter among themselves, decided to lease the properties to the Army to protect them from looting, and thereafter offered to lease the buildings to defendant.

On or about February 27 or 28, 1945, plaintiffs and an agent of defendant inspected the Michel Apartment building, and on March 7,1945, executed Lease No. Eng-2 for the building “for the period of the war and six months thereafter” with the provision that defendant would pay “as rental the fair present rental value of the property as determined by competent authority.”

On, or about, March 23, 1945, plaintiffs and an agent of defendant inspected the “old” SyQuia Apartment building and the “new” SyQuia Apartment building, and on that date executed leases therefor under the same terms and conditions as found in the lease for the Michel Apartment building.

Plaintiffs reserved three of the apartments on the third floor of the “new” SyQuia Apartment building for their personal use.

The leases were on printed forms supplied by defendant, the printed portions of which included the phrase “ for the period of war and six months thereafter.”

There is no evidence as to any discussion between plaintiffs and defendant as to the phrase “for the period of the war and six months thereafter.”

5. On July 5, 1945, General MacArthur and President Osmena officially proclaimed that the Philippine Islands had been liberated from the Japanese.

6. On July 8,1945, plaintiffs and defendant’s contracting officer executed a lease for the Michel Apartment building, which lease provided, in pertinent part:

2. The term of this lease shall be for the period beginning 7 March, 1945, and extending therefrom for the duration of the war and six (6) months thereafter, unless sooner terminated by the GOVERNMENT as hereinafter provided. Due to exigencies of service, the United States Military Forces have had the use of the leased premises from 7 March, 1945 to date hereof. It is therefore understood and agreed by and between the parties hereto that this lease is retroactive to and. including 7 March, 1945, original date of use by United States Military Forces.

4. The government shall pay to the lessor as monthly rental under this lease the sum of Thirty-Three-Hundred-Thirty-Five tesos (4*3,335) in lawful money of the Philippines, or the equivalent in United States Currency at the ratio of one (1) Dollar to each two (2) Pesos, such payments to be made within ten (10) days after each calendar month of occupancy * * *.

5. The government may, at any time prior to the termination of this lease, use the property for any purpose or purposes. * * *.

6. The government may terminate this lease at any time during the term hereof by giving written notice to the lessor at least thirty (30) days in advance * * *.

7. The government shall not be responsible, except under special legislation, for any damages to the premises by reason of combat operations, acts of God, the elements or other acts and deeds not due to negligence on the part of the government.

8. This Lease Agreement supersedes and voids any and all agreements and understandings, oral and written, previously entered into between the parties covering the property herein leased, the same having been merged herein. This agreement may not be modified or altered except by instrument in writing duly signed by the parties.

Plaintiffs and defendant’s contracting officer also executed leases for the “new” SyQuia Apartment building and the “old” SyQuia Apartment building on July 8, 1945, and August 7,1945, respectively, containing the same provisions as the Michel lease, above set out, except that the effective dates of the leases were designated as March 23, 1945, and the monthly payments were 1*1,775 and 5*1,890, respectively. Plaintiffs retained four apartments in the new SyQuia Apartment building for their own use.

Tbe leases were on printed forms supplied by defendant, the printed portions of which included the phrase “for the duration of the war and six months thereafter.”

7. At the time of the execution of the leases, neither plaintiffs nor the defendant’s contracting officer discussed the phrase “for the duration of the war and six months thereafter.”

Defendant’s contracting officer executed the following certificate on each of the leases below the signature of the parties and the attesting witnesses:

I certify that the services to be obtained by this instrument are authorized by, are for the purpose set forth in, and are chargeable to allotments shown below, the available balance of which are sufficient to cover the cost thereof; and that the above purchase was made pursuant to blanket authority given by the General Purchasing Agent, First War Powers Act, and Executive Order No. 9001, 27 December 1941, and the prices paid are not in excess of prices fixed by United States ^Regulation or local law.

8. Shortly after the execution of the leases of July 8 and August 7, 1945, defendant made some temporary repairs to the buildings and thereafter billeted officers in them.

Toward the end of the year 1945, the officers billeted in the buildings were notified by defendant to vacate them. Plaintiffs expected that the buildings when vacated, would be returned to them; however, defendant then made repairs to the buildings, and thereafter the buildings were used to house officers’ families.

9. Plaintiffs, sometime in early 1946, requested that the apartments be returned to them as the leases had expired six months after Y-J Day. This request, made in March 1946, was denied. Plaintiffs’ chief complaint was that the rentals paid by defendant were too low. Plaintiffs’ efforts to secure higher rentals were to no avail.

By letter dated May 11,1946, plaintiffs advised defendant, as follows :

We request the renegotiation of the leases for the Sy-Quia Apartments Nos. 1 and 2 and the Michel Apartments. This request is based on the announced intention of the Army to continue to occupy them for the officers’ families.

We call your attention to the fact that the rentals on those leases are based on a percentage of the 1941 rentals which we accepted in the expectancy that all prices would be controlled and kept within reason. Since then, salaries, wages and prices have staged a run-away act and official indexes stand at over 500% of the base prices with the purchasing power of the peso at 17 centavos. Under these conditions we think that our request for triple the present monthly rental paid by the Army in exchange for a new lease for a three year period is reasonable.

As previously suggested to you, we would consider selling the properties in exchange for surplus material if the Army can make such a transaction and has surplus real estate in Manila for disposal.

10. By letter dated June 6,1946, defendant acknowledged receipt of plaintiffs’ letter of May 11, 1946, supra, and advised plaintiffs, in pertinent part:

‡ # 'Jfi # #

The Commanding General directs you be informed that a contract cannot be altered to the detriment of the Government. For your information, it is contemplated that the United States Army will vacate subject properties prior to 1 February 1947. Acquisition of subject properties by the United States Government is not planned at this time.

11. By letter dated June 28, 1946, plaintiffs requested cancellation of the leases and early return of the apartments. By letter dated July 31, 1946, defendant advised plaintiffs that it planned indefinite use of the buildings and could not return the apartments to plaintiffs at that time. Subsequent efforts by plaintiffs to have the rentals increased and to have a part of the apartments returned were to no avail.

12. On February 17,1947, plaintiffs served formal notices upon defendant’s then Commanding General in the Philippines, George C. Moore, defendant’s then Chief of the Real Estate Division in the Engineers Office, Erland A. Tillman, and the 64 occupants of the apartment buildings to cancel the leases, to increase the rental, and either execute new leases or release the apartments within 30 days thereafter. All parties failed to comply with the notices, and plaintiffs instituted an action of unlawful detainer in the Municipal Court of Manila against these parties. On April 29, 1947, the Municipal Court of Manila found that the war between the United States and her allies and Germany and Japan had not yet terminated, that the terms of the leases had not expired, and that the United States, the real party in interest, could not be sued in the Courts of the Philippines without its consent. Plaintiffs appealed this decision to the Court of First Instance of Manila, which by order dated July 12,1947, affirmed the decision on the ground that the United States, the real party in interest, could not be sued in the courts of the Philippines without its consent. On appeal to the Supreme Court of the Philippines, the dismissal was affirmed, on jurisdictional grounds, by decision dated August 17,1949.

13. By letter dated January 9,1948, and received by plaintiffs on January 12, 1948, defendant advised plaintiffs as follows:

I am pleased to inform you that the present occupants will vacate your apartments as soon as it is practicable to do so. The North Syquia Apartment will be released on or about 29 February 1948, the South Syquia Apartment will be released on or about 31 March 1948 and the Michele Apartment on or about 31 May 1948. You will be contacted by the District Engineer, Manila Engineer District, who will give formal notice of the election of the United States to terminate these leases on the dates indicated.

Formal notices of cancellation of the leases were served on plaintiffs on January 12,1948, stating that the apartments would be vacated on the dates set forth in the letter above. Plaintiffs refused to acknowledge receipt of the notices. The apartments were vacated on or before the specified dates and, thereafter, the accrued rentals were paid to and received by plaintiffs who accepted them under protest.

CONCLUSION OF LAW

Upon the foregoing findings of fact, which are made a part of the judgment herein, the court concludes as a matter of law that the defendant’s motion to dismiss plaintiffs’ petition pursuant to Bule 49 (c) should not be granted.

The case is remanded to a Commissioner of this court for further proceedings not inconsistent with this opinion.

1 In some New York cases the courts have held that leases containing the phrase “duration of the war” to define the terms of the lease, meant “until the signing of a formal peace treaty.” These New York courts held such leases to be for an indefinite term and therefore to result In a tenancy at will.

2 Breese Burners, Inc. v. United States, No. 50191, decided June 8, 1954.