Question:  Does a lease contract which ends on a monthly basis affected by the Rent Control Act?

No.  This issue was settled in the case of De Vera vs. Court of Appeals, 

G.R. No. 110297 August 7, 1996:

First. The issue in this case is whether the oral contract of lease was on a month-to-month basis which is terminated at the end of every month. We hold that it is. We have already ruled in a number of cases 5 that a lease on a month-to-month basis is, under Art. 1687, a lease with a definite period, upon the expiration of which upon demand made by the lessor on the lessee to vacate, the ejectment of the lessee may be ordered.

Art. 1687 of the Civil Code provides:

Art. 1687. If the period for the lease has not been fixed, it is understood to be from year to year, if the rent agreed upon is annual; from month to month, if it is monthly; from week to week, if the rent is weekly; and from day to day, if the rent is to be paid daily. However, even though a monthly rent is paid, and no period for the lease has been set, the Courts may fix a longer term for the lease after the lessee has occupied the premises for over one year. If the rent is weekly, the Courts may likewise determine a longer period after the lessee has been in possession for over six months. In case of daily rent, the courts may also fix a longer period after the lessee has stayed in the place for over one month.

This provision has not been affected by the suspension in §6 of B.P. Blg. 877 which provides:

§6. Application of the Civil Code and Rules of Court of the Philippines. — Except when the lease is for a definite period, the provisions of paragraph (1) of Article 1673 of the Civil code of the Philippines, in so far as they refer to residential units covered by this Act, shall be suspended during the effectivity of this Act, but other provisions of the Civil Code and the Rules of Court on lease contracts, in so far as they are not in conflict with the provisions of this Act shall apply.

 

Thus, what has been suspended by the Rent Control Law (§6 of B.P. Blg. 877, formerly §6 of B.P. Blg. 25) is Art. 1673 and not Art. 1687 of the Civil Code. The effect of the suspension on Art. 1687 is only that the lessor cannot eject the tenant by reason alone of the expiration of the period of lease as provided in said Art. 1687. Otherwise, Art. 1687 itself has not been suspended. Hence, it can be used to determine the period of a lease agreement. 6