PREFACE

One cold night sometime in the year 2008, I had the idea
of finally realizing a longtime dream of writing a book that will
be published and be read by everyone. Since I got exposed to the
Housing and Land Use Regulatory Board (HLURB) cases, I knew
I had to write a book which focuses on the procedures, laws and
jurisprudence relating thereto. With the available jurisprudence
with me, I started to research and compile cases, laws and other
write ups concerning the real estate industry. Little did I know that
this collection of cases was so vast and it consumed me in my pursuit
of writing the book.
With a simple twist of fate, during the height of one of the
cases I was handling, my laptop was stolen in front of the Supreme
Court, and the manuscript I started writing on was gone forever.
Desperate, puzzled, dazed and perplexed, the passion of continuing
the book had subsided, and the long and unexpected hiatus left me
in a dark oblivion asking myself whether I will continue writing the
book.
But with a bucket full of perseverance and patience, although
back to square one, I was finally again burning the midnight oil for
writing the book. Conversely, putting back into pieces the first few
chapters was like searching a missing gold watch in the middle of the
unchartered sea. Nevertheless, as soon as my zealousness, passion
and enthusiasm fueled me back from this apparent cold hibernation,
there was no turning back. After all, Alexandre Dumas Pre1 once
said, All human wisdom is summed up in two words wait
and hope.

1
Alexandre Dumas (pronounced: [a.l3k.sd dy.ma], born Dumas Davy
de la Pailleterie,[dy.ma da.vi dE pa.jEt.i], 24 July 1802 5 December 1870)was
aFrenchwriter, best known for his historical novels of high adventure which have
made him one of the most widely read French authors in the world. Many of his
novels, including The Count of Monte Cristo, The Three Musketeers, Twenty Years
After, andThe Vicomte de Bragelonnewere originallyserialized. He also wrote plays
and magazinearticlesand was a prolificcorrespondent. (http://en.wikipedia.org/wiki/
Alexandre_Dumas_pre)

iii
 I have written this book primarily to focus more on the intricacies
of the laws and jurisprudence relative to the HLURB. Though this
book may not be as complete as one would expect, nevertheless, this
will be helpful to law practitioners, law students, and real estate
practitioners who are dealing with matters concerning the real
estate industry.
With this endeavor, it is fervently hoped that this book shall
be useful and helpful to everyone who will get a copy, particularly
to those who are engaged in the business of real estate and all other
matters collateral thereto. On the brighter side, let this book be an
inspiration to those who are lurking for sometime in their quest of
equally writing a book despite the existence adversaries.
Let me end by extending my warmest thanks to those who were
instrumental in writing this book: to my family, who has been so
patient in listening to me every time I update them; to Atty. Marino
Torres of the HLURB, who has provided me with the materials and
other Supreme Court decisions; to Atty. Rodolfo Tagapan, whose
suggestion of the title was perfect for this book; to Atty. Aristotle
Q. Sarmiento, who has introduced me to the world and intricacies
of the HLURB cases; to Judge Ed Vincent Albano, who became an
instrumentl in the publication of this book; and to REX Bookstore
who made the publication of this book a reality.



EDINBURGH P. TUMURAN
Cainta, Rizal, July 30, 2012

iv
 CONTENTS

Chapter I: INTRODUCTION................................................. 1
Chapter II: THE HUMBLE INCEPTION
OF THE HLURB ............................................................. 12
I. Executive Order No. 419............................................. 13
II. Presidential Decree No. 933........................................ 13
III. Presidential Decree No. 957........................................ 13
IV. Presidential Decree No. 1344...................................... 14
V. Presidential Decree No. 1396...................................... 14
VI. Executive Order No. 648............................................. 14
VII. Executive Order No. 85............................................... 15
Realty Exchange Venture Corporation, et al. v.
Lucina S. Sendino, et al........................................ 16
VIII. Executive Order No. 90............................................... 17
IX. R.A. No. 8763, Home Guaranty Corporation
Act of 2000.................................................................. 18
X. R.A. No. 9904............................................................... 19

Chapter III: THE HLURB AS AN ADMINISTRATIVE

AGENCY................................................................... 21
I. The doctrine of primary administrative
jurisdiction............................................................. 22
a. Pambujan Sur United Mine Workers v.
Samar Mining Co., Inc............................... 22
b. Dulos Realty and Development Corporation
v. Hon. Court of Appeals and Vicenta
Peleas.......................................................... 23
II. The statutory powers conferred to the HLURB, as
an administrative agency, must always be
construed according to their legislative intent........... 24
III. The HLURB has the power and authority to
promulgate implementing rules and
regulations.................................................................... 24

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 IV. Some of the sources of the HLURBs rule
making authority......................................................... 25
V. The quantum of proof required in administrative
cases and elements of administrative
due process................................................................... 27
VI. Exhaustion of administrative remedies...................... 29
a. General rule......................................................... 29
Josefina Teotico (also known as Baby
Santana) v. Rosario D. Baer....................... 29
b. Exception to the general rule............................. 31
Sps. Leonardo and Milagros Chua v. Hon.
Jacinto G. Ang, et al................................... 31
VII. Final and executor judgment of the HLURB
may no longer be modified........................................... 36
Felisa L. Pea v. Government Service Insurance
System (GSIS)....................................................... 37
VIII. Splitting causes of action is disfavored in the
HLURB cases; hence, all causes of action must
be alleged in the complaint......................................... 42
IX. A memorandum decision is allowed in administrative
proceedings authorized under Section 40 of
B.P. Blg. 129, also known as The Judiciary
Reorganization Act of 1980. ...................................... 43
X. It is settled that Rules of Procedure, as a matter of
course, should be construed liberally in proceedings
before administrative bodies (which
includes the HLURB).................................................. 49
Realty Exchange Venture Corporation, et al.
v. Lucina S. Sendino, et al.................................... 49
XI. Exception to the general rule that factual findings
of administrative agencies is given
greater respect............................................................. 51
XII. The New HLURB Rules speed up complaints
disposition.................................................................... 51
XIII. A brief analysis of the Rules of Procedure being
followed on cases filed with the HLURB under
Resolution No. 871....................................................... 53
1. Coverage.............................................................. 54
2. Complaint............................................................ 55
3. Service of Summons, Notices, Resolutions,
Orders and Decision: In General............... 55

xiv
 4. Verified Answer or Responsive Pleading........... 55
5. Effect of Failure to File a Verified Answer
or Responsive Pleading.............................. 55
6. Mandatory Conference........................................ 56
7. Mediation Proceedings........................................ 56
8. Confidentiality of Mediation Proceedings.......... 56
9. Effect of Failure to Appear in the Mediation
Proceedings................................................. 57
10. Termination of Mediation Proceedings.............. 57
11. Position Papers and Draft Decisions.................. 57
12. Ocular Inspection and/or Clarificatory
Hearings...................................................... 57
13. Judgment............................................................. 57
14. Jurisdiction of the Board of Commissioners...... 58
15. Appeal Memorandum.......................................... 58
16. Appeal Bond........................................................ 58
17. Counter-Memorandum....................................... 58
18. Admissibility of New Evidence on Appeal......... 59
19. Dismissal of the Appeal...................................... 59
20. Judgment of the Board of Commissioners......... 59
21. Finality of Judgment........................................... 59
22. Execution of Judgments...................................... 60
23. Execution Pending Appeal.................................. 60
24. Coverage.............................................................. 60
25. Creation of a Management Committee.............. 61
26. Grounds for the Creation of the
Management Committee............................ 61
27. Cease and Desist Order...................................... 62
28. Grounds for the Issuance of Cease and
Desist Order................................................ 62
29. Petition for Inspection of Books and Records.... 62
30. Election Contest; Definition................................ 63
31. Filing of Election Contest................................... 63
32. Answer................................................................. 63
XIV. Board of Commissioners of the HLURB..................... 64
XV. Certain functions of the HLURB were devolved
to the Local Government Units................................... 65
XVI. The HLURB has the power and authority to
regulate the development of Memorial Parks,
Cemeteries and Columbarium Projects...................... 65

Chapter IV: THE JURISDICTION OF THE HLURB . .. 67

I. Jurisdiction in General................................................ 67

xv
 a. Definition of Jurisdiction.................................... 67
b. Jurisdiction is also defined as follows................ 68
c. The inevitability of jurisdiction.......................... 69
II. The reasons and justification on the jurisdiction
of the HLURB.............................................................. 69
III. The provisions of P.D. No. 957 are intended to
encompass all questions relating to subdivisions...... 70
IV. P.D. No. 1344 enumerated the jurisdiction
of the HLURB.............................................................. 70
a. Example of unsound real estate business
practices under Section 1 of
P.D. No. 1344.............................................. 72
a.1 Union Bank of the Philippines v. HLURB. 72
a.2 The HLURB, not the RTC, has jurisdiction
on the developers act of using different
descriptions of the condominium project.. 73
Tri-Corp Land & Development Inc. v. Court
of Appeals and Greystone Corporation.............. 73
V. It must be noted that the allegations in the complaint
determines the jurisdiction of the court..................... 75
a. The allegations in the complaint do not show
that the HLURB has jurisdiction.............. 77
b. The allegations in the complaint indubitably
show that the HLURB has no
jurisdiction.................................................. 78
c. The HLURB jurisdiction when there is conflict
between the title of the case and the
allegations in the complaint....................... 80
Spouses William Genato and Rebecca Genato
v. Rita Viola................................................ 80
d. The RTC, not the HLURB, has jurisdiction
on complaint for Action Publiciana........... 84
VI. The HLURB has power and jurisdiction to
award damages............................................................ 84
a. The authority and jurisdiction of the HLURB
to award damages either in favor of the
complainant or of the defendant................ 85
b. The HLURB has no jurisdiction in a complaint
filed by the buyer against the developer
for the payment of moral, actual and
exemplary damages.................................... 86

xvi
 Ridgewood Estate, Inc. (erroneously sued as
Camella Homes) v. Expedito Belaos..................... 86
VII. The HLURB has jurisdiction over complaints for
specific performance with damages under
the Civil Code............................................................... 89
C.T. Torres Enterprises, Inc. v. Hon. Romeo J.
Hibionada............................................................... 90
VIII. The awards of damages and attorneys fees may not
be given when the same were not specifically
prayed for in the complaint......................................... 91
V.V. Soliven Realty Corp. v. Luis Kung
Beng T. Ong........................................................... 91
IX. Questions relating to non-compliance with the
requisites for conversion of subdivision lots fall
within the jurisdiction of HLURB............................... 95
Cristobal v. Court of Appeals...................................... 95
X. The enforcement of ones statutory and contractual
rights against the subdivision owners, being a
specific performance case, falls under the HLURBs
exclusive jurisdiction................................................... 97
Oscar R. Badillo v. Court of Appeals, et al................. 97
XI. The HLURB has no jurisdiction over the issue of
ownership, possession or interest in the disputed
condominium unit, under Section 1 of
P.D. No. 1344............................................................... 100
Sps. Carlos J. Suntay and Rosario R. Suntay v.
Eugenia D. Gocolay and Dunstan T.
San Vicente............................................................ 101
XII. Not every controversy involving a subdivision or
condominium unit falls under the competence
of the HLURB.............................................................. 105
Lacson Hermanas, Inc. v. Heirs of Cenon
Ignacio.................................................................... 105
XIII. The HLURB, not the RTC, has jurisdiction over
claims for refund of reservation fees for the
purchase of a subdivisions property........................... 108
Atty. Enriqueto F. Tejada v. Homestead
Property Corporation, et al................................... 108

xvii
 XIV. The RTC, not the HLURB, has jurisdiction over the
complaint for cancellation of the contract to sell
of a subdivision house and lot..................................... 110
XV. The HLURB has jurisdiction in cases over an
action to compel a land developer to deliver a
promised title over one-fourth a subdivision lot........ 111
Spouses Ernesto Lim and Zenaida Lim v.
Ruby Shelter Builders and Realty
Development Corporation..................................... 111
XVI. The HLURB has jurisdiction in cases which involve
a mortgage entered into by the real estate
developer...................................................................... 114
Home Bankers Savings & Trust Co. v. The
Honorable Court of Appeals........................................ 114
XVII. Principles of estoppel and laches to raise the
issue on jurisdiction..................................................... 116
a. As to the Principle of Estoppel............................. 116
b. As to the Principle of Laches................................ 121
XVIII. The Supreme Court ruled that a party who files a
suit before a court that lacks jurisdiction is
not necessarily estopped from raising the
issue of jurisdiction............................................... 123
XIX. The jurisdiction on receivership filed by the
homeowner is with the HLURB and not with
the Securities and Exchange Commission........... 124
a. Receivership, defined.......................................... 124
b. Supreme Court sustained the jurisdiction
of the HLURB to try and hear a case
involving receivership................................ 126
Jesus Lim Arranza, et al. v. B.F. Homes, Inc............. 126
XX. The HLURB has jurisdiction to resolve the issue
of development of subdivision............................... 132
XXI. The HLURB has jurisdiction to determine the
rights and Obligations of the parties in a sale
of real estate and to compel the developer to
comply with its undertaking................................. 132
XXII. In a complaint for reformation of contract, the
RTC, and not the HLURB, has jurisdiction
over the same......................................................... 133

xviii
 Frabelle Fishing Corporation v. The Philippine
American Life Insurance Company, et al............ 133
XXIII. Finding of facts by administrative agencies
(which includes the HLURB) is generally
accorded respect.................................................... 136
XXIV. There are hundreds of administrative bodies now
performing this function by virtue of laws
enacted by congress. This quasi-judicial
function is exercised by them as an incident
of the principal power entrusted to them or
regulating certain activities falling under
their particular expertise...................................... 136
XXV. The HLURB has no jurisdiction on cases filed by
the land owner or developer against the buyer... 137
a. The original jurisprudence: The HLURB has
jurisdiction on cases filed by owner/
developer of subdivision against buyer..... 137
Francel Realty Corporation v. Court of Appeals
and Francisco T. Sycip............................... 138
b. The recent jurisprudence: the HLURB has
no jurisdiction on cases filed by the
owner/developer of subdivision
against the buyer........................................ 141
c. The HLURB has no jurisdiction on a case
filed by the developer or the owner
of a subdivision........................................... 145
Leta Dela Cruz v. Court of Appeals................... 145
d. The RTC, and not the HLURB, has jurisdiction
in cases filed by the owner and developer
of real estate................................................ 148
Jin-Jin Delos Santos v. Spouses Sarmiento,
et al.............................................................. 148
e. Exception to the general rule where the
developer/owner can file a case against
the buyer with the HLURB is when the
cause of action of the owner or developer
is instituted in the compulsory
counterclaim............................................... 153
Jin-Jin Delos Santos v. Spouses Sarmiento.............. 153

xix
 XXVI. HLURB jurisdiction over issues involving
disputes amongst and between homeowners
association.............................................................. 154
Edna Eugenio v. Sta. Monica Riverside
Homeowners Association...................................... 154
a. The HLURB has jurisdiction over the case
involving dispute between homeowners
association................................................... 158
Maria Luisa Park Association, Inc. v. Samantha
Marie T. Almendras, et al.......................... 158
b. If the allegations in the complaint state that
there is no intra-corporate dispute
amongst members of the homeowners
association, the RTC, not the HLURB,
has jurisdiction over the complaint for
damages on an alleged violation of their
right of access through the subdivision
and on the alleged embarrasment and
humiliation suffered by them..................... 163
Sta. Clara Howeowners Association v.
Victor Ma. Gaston and Lydia Gaston........ 163
XXVII. A Regional Trial Court judge cannot issue a
Temporary Restraining Order and Writ of
Preliminary Injunction against the HLURBs
Writ of Execution considering that both
are co-equal bodies................................................ 171
Russel Esteva Coronado v. Judge Eddie R.
Rojas /Alfredo S. Capisin, et al.
Judge Eddie R. Rojas........................................ 171
XVIII. The RTC has no power and authority to restrain
X
or issue Temporary Restraining Order
against the HLURB on cases involving
questions on subdivisions and condominiums
under P.D. No. 957................................................ 174
Romulo R. Peralta v. Hon. Raul E. De Leon........ 174
XXIX. The Office of the Prosecutor and not the HLURB
has jurisdiction to determine the existence
of probable cause as a prelude for the filing of

xx
 a criminal information for the violation
of P.D. No. 957....................................................... 179
Sps. Leonardo and Milagros Chua v. Hon.
Jacinto G. Ang, Dennis R. Pastrana, et al....... 179
XXX. The HLURB, not the DENR, is the sole
regulatory body for housing and land
development which is tasked for the
responsibility of monitoring housing and
land development projects.................................... 183
Ignacia Balicas v. Fact-Finding & Intelligence
Bureau (FFIB), Office of the Ombudsman........... 184
XXXI. Under P.D. No. 957, the civil and criminal actions
are independent of each other, and there exist
no prejudicial question in the former over
the latter................................................................ 187
XXXII. The HLURB has jurisdiction to determine the
question on whether there is a perfected contract
of sale between a condominium buyer and
developer................................................................ 187
Spouses Cesar and Elvira Raet, et al. v.
Court of Appeals................................................ 187

Chapter V: PRESIDENTIAL DECREE NO. 957................ 192

Presidential Decree No. 957: Regulating the Sale of

Subdivision Lots and Condominiums, Providing
Penalties for Violations Thereof........................................ 192
I. Government agencies that play major role in
shaping the face of the real estate industry......... 194
a. National Home Mortgage Finance
Corporation (NHMFC)............................... 194
b. National Housing Authority (NHA)................... 194
c. Home Development Mutual Fund (HDMF)....... 194
d. Housing and Urban Development
Coordinating Council (HUDCC)................ 194
e. Hoem Guaranty Corporation (HGC).................. 195
II. The distinctive intention of P.D. No. 957 is for the
ultimate protection of innocent lot buyers
against the seemingly manipulative and
scheming subdivision developers.......................... 197

xxi
 Florencio Eugenio v. Executive Secretary Franklin
M. Drilon, Housing and Land Use Regulatory
Board (HLURB) and Prospero Palmiano............. 200
III. The Supreme Court used the statutes preamble
or the introductory or preparatory clause that
ultimately expounds the reasons for its being
enacted and for its interpretation........................ 203
Marjorie B. Cadimas, et al. v. Marites Carrion
and Gemma Hugo.................................................. 203
Title I: TITLE AND DEFINITIONS......................................... 205
Jacobus Bernhard Hulst v. PR Builders, Inc.................... 208
Title II: REGISTRATION AND LICENSE TO SELL.............. 214
Ruben S. Sia and Josephine Sia v. People of the
Philippines and Teresita Lee................................ 220
I. The total absence of certificate of registration
and license to sell does not ipso facto render
the contract null and void..................................... 225
Spouses Howard T. Co Chien and Susan Y.Co
Chien v. Sta. Lucia Realty & Development,
Inc., and Alsons Land Corporation....................... 225
II. The lack of Certificate of Registration/License to
Sell merely subjects the developer to
administrative sanctions....................................... 228
G.G. Sportswear Mfg. Corp. v. World Class
Properties............................................................... 228
III. The absence of license to sell does not affect the
validity of an already perfected contract of
sale between buyer and owner or developer........ 235
Vicenta Cantemprate, et al. v. CRS Realty
Development Corporation, et al............................ 235
IV. Checklist of requirements for Certificate of
Registration and License to Sell........................... 238
I. Two ways wherein the license to sell may
be suspended................................................................ 245
a. Through a verified petition................................. 245
b. By the HLURB motu proprio or upon its
own initiative.............................................. 246

xxii
 II. How can the suspension order be lifted...................... 246
III. Confidentiality nature of the Suspension Order........ 247
Title III: Dealers, Brokers and Salesmen.................................. 249
Title IV: Procedure for Revocation of Registration
Certificate.............................................................. 254
I. Resolution No. 871 of the HLURB.............................. 256
Land Bank of the Philippines v. Severino
Listana, Sr............................................................. 259

Rule 22 CONTEMPT............................................................... 260

Sec. 80. Direct Contempt............................................................ 260

Sec. 81. Indirect Contempt......................................................... 260
Sec. 15. Decision.......................................................................... 261
I. The doctrine of finality of judgment............................ 262
II. Manner of execution not in accord with the tenor
and terms of judgment................................................. 262
III. The doctrine of immutability of judgment.................. 263
Sec. 16. Cease and Desist Order................................................ 263
Sec. 17. Registration................................................................... 265
I. Allocation of open space to be used as park
and playground............................................................ 266
Spouses Claudio M. Anonuevo and Carmelita
Anonuevo v. Court of Appeals, et al........................... 266
II. Seller is duty bound to register the Contract
to Sell and/or Deed of Assignment....................... 271
Sec. 18 . Mortgages...................................................................... 274
Sec. 1. Complaint in action for closure...................................... 275
I. Declaration of nullity of real estate mortgage............ 277
II. Provision enacted on July 1976 applied to
a mortgage executed on December 1975.............. 278
Philippine National Bank v. Office of the
President, et al....................................................... 278
III. Declaration of nullity of Real Estate Mortgage.......... 283
Metropolitan Bank and Trust Company Inc. v.
SLGT Holdings, Inc., et al/United Coconut
Planters Bank SLGT Holdings, Inc. et al............ 283

xxiii
 IV. Acts committed contrary to Section 18 of
P.D. No. 957 are void............................................. 289
V. Failure of the bank to inquire about prior
written approval of the HLURB before the
property was used as collateral............................ 290
Home Bankers Savings and Trust Co. v. Court
of Appeals............................................................... 291
Sec. 19. Advertisement............................................................... 294
I. Failure of the developer to provide buyer the
features indicated in their brochure..................... 296
Bank of the Philippine Islands v. ALS
Management & Development Corp...................... 296
Sec. 20 . Time of Completion....................................................... 299
I. Non-compliance of the owner or developer to
complete the project within a period of one
year from the date of the issuance of
the license.............................................................. 300
Zamora Realty, et al. v. Office of the President
of the Philippines and Edilberto C. Gallardo....... 300
Sec. 20 . Time of Completion....................................................... 301
Sec. 23. Non-forfeiture of Payments.......................................... 301
II. Two remedies in case of incomplete development
of the subdivision project...................................... 304
Sec. 21. Sales Prior to Decree..................................................... 304
I. Section 20, in relation to Section 21, requires
owner or developer to construct facilities,
improvements and infrastructures indicated
in the approved subdivision or
condominium plans, brochures and any
form of advertisement........................................... 305
Jose Antonio Mapa v. Hon. Joker Arroyo, et al.......... 306
I. Alteration envisioned under Section 22 of
P.D. 957 must be made with the written
conformity or consent of the duly organized
homeowners association or the majority
of the lot buyers..................................................... 310
G.O.A.L. Inc. v. Court of Appeals, et al...................... 310

xxiv
Sec. 23. Non-forfeiture of Payments.......................................... 312
I. Action to be taken of the buyer upon failure of
the developer to cause the development of
the subdivision lot or condominium unit............. 313
G.G. Sportswear Mfg. Corp. v. World Class
Properties, Inc....................................................... 313
II. Buyers are entitled to reimbursement of the
amount paid, plus interest thereon...................... 314
Fil-Estate Properties, Inc. v. Spouses Gonzalo
and Consuelo Go.................................................... 314
III. Failure to develop a subdivision does not constitute
a legal justification for the non-payment of
amortizations by a buyer...................................... 319
Florencio Eugenio v. Executive Secretary Franklin
M. Drilon, HLURB and Prospero Palmiano........ 319
Sec. 20. Time of Completion....................................................... 320
Sec. 21. Sales Prior to Decree..................................................... 321
Sec. 23. Non-forfeiture of Payments.......................................... 321
IV. Securing a clearance from the HLURB is not
needed to lawfully withhold monthly
payments . ............................................................. 323
Francel Realty Corporation v. Ricardo T. Sycip......... 323
Sec. 23. Non-forfeiture of Payments.......................................... 323
V. Subsequent dishonor of the check without
valid cause............................................................. 325
Francisco T. Sycip, Jr. v. Court of Appeals.......... 326
VI. The HLURB properly applied Section 23 of
P.D. No. 957 and ordered the suspension
of payment valid.................................................... 328
Sec. 23. Non-forfeiture of Payments.......................................... 328
Sec. 24. Failure to Pay Installments.......................................... 330
I. R.A. No. 6552 makes no distinction between
option and sale................................................. 332
Realty Exchange Venture Corporation and/or
Magdiwang Realty Corporation v. Lucina S.
Sendino, et al......................................................... 332
Sec. 24. Failure to Pay Installments.......................................... 333

xxv
Sec. 25. Issuance of Title............................................................ 335
I. The justification that squatters entered the
property after the developer has incurred
delay is not a valid reason for non-delivery
of title..................................................................... 336
II. The owner or developer loses all its rights and
interests to the unit upon full payment
of the buyer............................................................ 336
G.O.A.L. Inc., v. Court of Appeals, et al..................... 336
Sec. III. (Contract to Sell). Title and Ownership of Unit........ 337
Sec. 25, P.D. 957 Issuance of Title.......................................... 338
III. Administrator of the estate of the developer
cannot be held criminally liable if non-delivery
of title was due to the pendency of a probate
proceedings in Court............................................. 338
Tomas Trinidad v. The Court of Appeals................... 339
Sec. 26. Realty Tax...................................................................... 343
I. Non-payment of taxes and other assessments
are not grounds for the non-delivery of title........ 344
Sec. 27. Other Charges.............................................................. 344
I. Powers of the homeowners association
emphasized under Section 12 of
R.A. No. 9904......................................................... 345
Sec. 28. Access to Public Offices in the Subdivisions............... 345
Sec. 29. Right of Way to Public Road........................................ 346
I. Section 29 of P.D. No. 957 applies only to the
owner or developer of a subdivision without
access to a public highway.................................... 346
Concordio Abellana, et al. v. Hon. Court of
Appeals, et al......................................................... 346
Sec. 29. Right of Way to Public Road......................................... 347
II. The owner/developer of a subdivision cannot
demand a compulsory easement of right of
way over the existing roads of an adjacent
subdivision............................................................. 348
Simeon Floro v. Orlando A. Llenado, et al................. 348
Sec. 30. Organization of Homeowners Association................... 351

xxvi
Sec. 31. Donations of roads and open spaces to local
government......................................................................... 352
I. The provisions of. P.D. No. 1216 cannot be given
retroactive effect.................................................... 354
Gloria Santos Dueas v. Santos Subdivisions
Homeowners Association...................................... 354
II. P.D. No. 957 provides that it is the registered
owner or developer of a subdivision has the
responsibility for the maintenance, repair
and improvement of a subdivision roads............. 356
Aniano A. Albon v. Bayani F. Fernando, et al............ 356
III. A subdivision owner/developer is legally bound
under P.D. No. 1216 to donate to the city or
municipality the open space allocated
exclusively recreational use.................................. 359
The City of Angeles v. Court of Appeals..................... 360
Sec. 31. Donation of roads and open spaces to local
government......................................................................... 362
Sec. 32. Phases of Subdivisions................................................. 365
Sec. 34. Visitorial powers........................................................... 366
Sec. 35. Take-over Development............................................... 368
Sec. 36. Rules and Regulations................................................. 368
I. The HLURBs power and authorization to
promulgate implementing rules and
regulation was upheld by the Supreme Court..... 369
Sec. 37. Deputization of law enforcement agencies.................. 370
Sec. 38. Administrative Fines................................................... 370
I. Ignorance of P.D. No. 957 is not a ground to be
excused from administrative fines and
penalties................................................................. 371
Sec. 39. Penalties....................................................................... 371
I. The penal provision..................................................... 371
II. The civil action pending with the HLURB is
not a ground to suspend a criminal action........... 372

Rule 111 PROSECUTION OF CIVIL ACTION..................... 372

Sec. 6. Suspension by reason of prejudicial question............... 372
Sec. 7. Elements of prejudicial question................................... 372

xxvii
 III. Department Circular No. 27 of the Department
of Justice................................................................ 373
Department Circular No. 27........................................ 374
IV. The subsequent issuance of a license to sell will
not extinguish the liability of the developer
for violation of Section 5 of P.D. No. 957.............. 375
Victoria P.Cabral v. Jacinto Uy, et al......................... 375
V. The City of Prosecutors Office of Naga City has
the authority to file the criminal information
for violations of P.D. No. 957................................ 378
Ruben S. Sia and Josephine Sia v. People of the
Philippines and Teresita Lee................................ 378
Sec. 40. Liability of controlling persons.................................... 382
Sec. 41. Other remedies............................................................. 382
Sec. 42. Repealing clause........................................................... 383
Sec. 43. Effectivity....................................................................... 384

Chapter VI: REPUBLIC ACT 6552....................................... 385

Republic Act No. 6552: An Act to Provide Protection to
Buyers of Real Estate on Installment Payments............. 385
Sec. 1. Realty Installment Buyer Act......................................... 385
Sec. 2. It is hereby declared a public policy to protect
buyers of real estate on installment payments
against onerous and oppressive conditions....................... 386
Sec. 3. ........................................................................................ 387
I. R.A. No. 6552 cannot be applied if the buyer did
not buy the property by installments . ................ 389
Lagandon v. Court of Appeals..................................... 390
II. No valid rescission of contract pursuant to
R.A. No. 6552 if demand letter was
furnished, not a notarial cancellation.................. 392
Olympia Housing, Inc. v. Panasiatic Travel
Corporation, et al................................................... 392
III. R.A. No. 6552 finds no application in contracts
that does not involve a subdivision owner
or developer but only between two couples.......... 395
Dela Cruz v. Court of Appeals..................................... 396

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 IV. Cancellation envisioned by R.A. No. 6552
pertains only to extrajudicial cancellation........... 399
Heirs of Paulino Atienza v. Domingo P. Espidol........ 400
V. The rescission contemplated by R.A. No. 6552
is a notarial cancellation....................................... 401
Manuel C. Pagtalunan v. Rufina Dela Cruz vda.
De Manzano........................................................... 401
Sec. 4 ........................................................................................ 404
I. The cancellation of a contract with its two-step
process.................................................................... 405
II. The absence of a notarial cancellation pursuant
to R.A. No. 6552 does not bar the filing of a
complaint for judicial cancellation....................... 405
III. How to compute the cash surrender of fifty
percent of the total payments made with
respect to the two-year monthly installments
paid......................................................................... 406
Jestra Development and Management
Corporation v. Daniel Ponce Pacifico................... 406
IV. The contract to sell cannot be considered
abandoned without notarial cancellation............. 408
Solid Homes, Inc. v. Evelina Laserna......................... 408
V. R.A. No. 6552 is applicable in rescission of
contract to sell....................................................... 410
a. Emiliano Rillo v. Court of Appeals and Corb
Realty Investment, Corp................................... 410
b. Active Realty & Development Corporation
v. Necita G. Daroya........................................... 414

Chapter VII: REPUBLIC ACT NO. 9904............................ 420

I. What is the Declaration of Policy of
R.A. No. 9904?....................................................... 424
II. What is an association?............................................... 424
III. What is an association member?................................. 424
IV. What is the basic community services
and facilities?......................................................... 425
V. What is the board?....................................................... 425
VI. What is a governing document?.................................. 425
VII. What is a homeowner?................................................. 425

xxix
 VIII. What is a simple majority?.......................................... 426
IX. What is a socialized housing?...................................... 426
X. What is a subdivision/village?..................................... 426
XI. Is there a need for the registration of every
association of homeowners with the HLURB?..... 426
XII. What are the rights and duties of every
homeowner?........................................................... 427
XIII. What are the qualifications of the members?............. 427
XIV. What are the rights of a member?.............................. 427
XV. What are the duties of a member?.............................. 428
XVI. How will the delinquent members be
sanctioned by the homeowners
association?............................................................ 428
XVII. What are the rights and powers of the
association?............................................................ 428
XVIII. What are the duties and responsibilities
of the board?.......................................................... 431
XIX. In what instances wherein the board of
directors are not allowed in behalf of
the association?...................................................... 432
XX. How can a director or trustee be removed
from office?............................................................. 432
XXI. Once a director is removed from office, how
is the vacancy filled?.............................................. 432
XXII. How can the board be dissolved?................................ 432
XXIII. Once the board is dissolved, who then can call
for the elections of new board of directors?.......... 433
XXIV. During the interim of the dissolution of the
former board and until the new set of board
shall have been elected, who shall manage
the association?...................................................... 433
XXV. How is the bylaws of the association adopted?.......... 433
XXVI. What are the contents of the bylaws of the
association?............................................................ 433
XXVII. How can a proxy voting be made?............................... 435
XXVIII. What are the obligations of the incumbent
officers respect to the financial and other
records of the homeowners?.................................. 435
XXIX. What are the duties of the homeowners
associations with respect to the LGUs in
providing vital services to their members and
help implement local government policies,
programs, ordinances, and rules?......................... 436

xxx
 XXX. In return, what shall the LGU do to reciprocate
the homeowners association?................................ 436
XXXI. What are the duties of the associations with
respect to the national members and help
implement the national government policies
and programs?....................................................... 437
XXXII. What are the duties and responsibilities of the
HLURB with respect to the homeowners?........... 437
XXXIII. What are the prohibited acts for homeowners
and homeowners associations?............................ 439
XXXIV. What are the penalties and sanctions in the event
that there is violation of the provisions
of R.A. No. 9904?................................................... 439
XXXV. What is the limitation as to the implementations
of the Rules and Regulations of
R.A. No. 9904?....................................................... 440
XXXVI. What actions should the existing homeowners
association have to do with respect to its
by-laws after the effectivity of under
R.A. No. 9904......................................................... 440
XXXVII. What is an election contest?........................................ 440
XXXVIII. What is the period for filing an election
contest?.................................................................. 441
XXXIX. What is the duty of the arbiter upon filing
of the complaint?................................................... 442
XL. What is the period for the respondent to
answer the complaint?.......................................... 442
XLI. What is the effect of failure to answer?...................... 443
XLII. What is the period to call for a clarificatory
Conference and what is the scope thereof?.......... 443
XLIII. What shall be the basis of the decision
of the arbiter?........................................................ 443
XLIV. Is the decision of the arbiter immediately
executor?................................................................ 443
XLV. What is the procedure in the event that there
is a failure of election?........................................... 443
XLVI. In the event that a regular or special election
is not held, what are the requirements that
the association will submit with the Regional
Office of the HLURB?............................................ 444
XLVII. What is the remedy of the event that the
reasons stated in the affidavit of non-holding
of election are found to be without merit?............ 444

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 LVIII. How can the incumbent homeowners association
X
officers assume their respective office in
a hold-over capacity?............................................. 445
XLIX. What is the procedure in Election Contests?............. 445
L. When did R.A. No. 9904 take effect?........................... 446

xxxii
 1

Chapter I

INTRODUCTION

The family should be a closely knit group. The home should be a self-
contained shelter of security; a kind of school where lifes basic lessons are
taught; and a kind of church where God is honored; a place where wholesome
recreation and simple pleasures are enjoyed.

Billy Graham1

T he vast and abundant wealth found in the wilderness, the

endless horizon seen on the open ocean, the countless pebbles
scattered along the sea shore, the perpetual wideness displayed by
the vast blue sky and the limitless supply of fresh air every minute
we breathe are only a few things that we can enjoy seemingly in
infinite fashion without fear of restrictions from other forces. This
may be true when times we seek to enjoy the gifts of nature in the
adventurous side of our lives and in a gratuitous manner. But not all
good things in life are free and we cannot get something for gratis or
conquer success out of nothing.
Succinctly put, one should burn the midnight oil to earn a
modest and clean living for him to ultimately and unquestionably
achieve his dreams and triumphantly reach his goals and aspirations
in life. And in everything we undertake in life, whether extremely
monumental or simply trivial, there is a price to pay. Like in a family,

1
William Franklin Billy Graham, Jr. American evangelical Christian
reverend/evangelist. As of April 25, 2010, when he met with Barack Obama, Graham
has spent personal time with twelve United States presidents going back to Harry S.
Truman, and is number seven on Gallups list of admired people for the 20th century.
He is a Southern Baptist. He rose to celebrity status as his sermons were broadcast
on radio and television. It is said that Graham has preached in person to more people
around the world than any other preacher in history. According to his staff, as of 1993
more than 2.5 million people have stepped forward at his crusades to accept Jesus
Christ as their personal Savior, many to the altar call song Just As I Am. As of
2008, Grahams lifetime audience, including radio and television broadcasts, topped
2.2 billion. (http://en.wikipedia.org/wiki/Billy_Graham [as of January 19, 2011])

1
2 THE HLURBS JURISDICTION

owning a house they can call their home, regardless of its gargantuan
size or diminutive existence is a significant accomplishment that
one will always find pride, joy and blissfulness in his heart.
A nation is built on a strong foundation of a family that serves
as a single unit composed of its household that plays a major role
in the nations development, growth and success. It is always a
dream of every Filipino family to own a decent house they can call
their home for them to foster stronger family ties and everlasting
bonding. This is likewise a comfort zone for the head of the family to
rear his children in a more conducive place to live in. A dream that
every family desires to achieve. As Lord Edward Coke Lord2 once
wrote, to wit:

The house of every one is to him as his castle

and fortress, as well for his defence against injury and
violence, as for his repose.

2
Sir Edward Coke (pronounced Cook) (February 1, 1552 September 3, 1634)
was a seventeenth-century English jurist and Member of Parliament whose writings
on the common law were the definitive legal texts for nearly 150 years. Born into a
family of minor Norfolk gentry, Coke travelled to London as a young man to make
his living as a barrister. There he rapidly gained prominence as one of the leading
attorneys of his time, eventually being appointed Solicitor General and then Attorney
General by Queen Elizabeth. As Attorney General, Coke famously prosecuted Sir
Walter Raleigh and the Gunpowder Plot conspirators for treason. In 1606, Coke was
made Chief Justice of the Court of Common Pleas, later being elevated, in 1613,
to Lord Chief Justice of England. As a judge, Coke delivered numerous important
decisions, and he gained a reputation as the greatest jurist of his age. Nonetheless,
his unwillingness to compromise in the face of challenges to the supremacy of the
common law made him increasingly unpopular with James I, and he was eventually
removed as Lord Chief Justice in 1616. Despite his dismissal from the bench and
his already advanced age, Coke remained an influential political figure, leading
parliamentary opposition to the Crown in the 1620s. His career in parliament
culminated in 1628 when he acted as one of the primary authors of the Petition of
Right. This document reaffirmed the rights of Englishmen and prevented the Crown
from infringing them.
Cokes enduring fame and importance rests principally on his immensely
influential legal writings and on his staunch defence of the rule of law in the face
of royal absolutism. His legal texts formed the basis for the modern common law,
with lawyers in both England and America learning their law from his Institutes
and Reports until the end of the eighteenth century. As a judge and Member of
Parliament, Coke supported individual liberty against arbitrary government and
sought to ensure that the kings authority was circumscribed by law. In later times,
both English reformers and American Patriots, such as John Lilburne, ames Otis,
and John Adams, used Cokes writings to support. (found at http://en.wikipedia.org/
wiki/Edward_Coke as of January 21, 2011.)
 CHAPTER I 3
INTRODUCTION

One will always see that shelter is one of the basic needs of
every individual to live normally. Although, most Filipino families
are striving to acquire real properties, either a house and lot or a lot
only, they are not equipped with the necessary financial capacity,
either because they do not have enough incomes to acquire the same,
or the current prices of real estate properties are too expensive and
can only be afforded by those who are earning substantial incomes.
We rather spend our hard earned money on basic needs, such as food,
clothing, education, to name a few, and save a considerable amount
for our future needs. This is a nagging reality, and an endless cycle
that we are all facing everyday in our lives.
No less than the 1987 Constitution so provides that, The
State recognizes the sanctity of family life and shall protect and
strengthen the family as a basic autonomous social institution.
x x x.3 This is a testimony that the family is so essential to the
growth of a nation. Another provision of the 1987 Constitution
that is worth reckoning with is Section 9, Article XIII of Social
Justice and Human Rights Urban Land Reform and Housing
which provides that:

Sec. 9. The State shall, by law, and for the common

good, undertake, in cooperation with the private sector,
a continuing program of urban land reform and housing
which will make available at affordable cost, decent hous-
ing and basic services to under-privileged and homeless
citizens in urban centers and resettlement areas. It shall
also promote adequate employment opportunities to such
citizens. In the implementation of such program the State
shall respect the rights of small property owners.

Moreover, Section 7 of Article XII of the 1987 Constitution

reserves only the ownership of real estate properties to Filipino
citizens:

Sec. 7. Save in cases of hereditary succession, no

private lands shall be transferred or conveyed
except to individuals, corporations, or associations
qualified to acquire or hold lands of the public
domain. (Emphasis supplied).

3
First sentence of Section 12, Article II (Declaration of Principles and State
Policies Principles) of the 1987 Constitution.