BEL-AIR VILLAGE ASSOCIATION, INC.

, petitioner,
HLURB - Deed Restrictions and Annotations in Sale or Real Estate vs.
COURT OF APPEALS, DOLORES FILLEY, and J. ROMERO &
ASSOCIATES, respondents.

Republic of the Philippines G.R. No. 82281 December 22, 1988

SUPREME COURT
Manila BEL-AIR VILLAGE ASSOCIATION, INC, petitioner,
vs.
EN BANC COURT OF APPEALS, VIOLETA MONCAL, and MAJAL
DEVELOPMENT CORPORATION, respondents.
G.R. No. 71169 December 22, 1988
Sangco, Anastacio, Castaneda & Duran Law Office for petitioners
& private intervenors- petitioners.
JOSE D. SANGALANG and LUTGARDA D. SANGALANG,
petitioners, FELIX C. GASTON and DOLORES R. GASTON,
JOSE V. BRIONES and ALICIA R. BRIONES, and BEL-AIR Raul S. Sison Law Offices for intervenor-petitioner Bel-Air Village
VILLAGE ASSOCIATION, INC.,intervenors-petitioners, Association, Inc. Renato L. Dela Fuente for respondent Ayala
vs. Corporation.
INTERMEDIATE APPELLATE COURT, and AYALA
CORPORATION, respondents. G.R. No. L-74376:

G.R. No. 74376 December 22, 1988 Raul S. Sison Law Offices for petitioner.

BEL-AIR VILLAGE ASSOCIATION, INC., petitioner, Sergio L. Guadiz for private respondents.
vs.
THE INTERMEDIATE APPELLATE COURT, ROSARIO DE G.R. No. L-76394:
JESUS TENORIO, and CECILIA GONZALVEZ,respondents.
Raul S. Sison Law Offices for petitioner.
G.R. No. 76394 December 22,1988
Gruba, Tanlimco Lamso and Apuhin Law Offices for respondents.
BEL-AIR VILLAGE ASSOCIATION, INC., petitioner,
vs. G.R. No. L-78182:
THE COURT OF APPEALS, and EDUARDO and BUENA
ROMUALDEZ respondents. Funk & Associates for petitioners.

G.R. No. 78182 December 22, 1988 Tee Tomas & Associates for respondents.
G.R. No. L-82281:
Funk & Associates for petitioner.
Castillo, Laman, Tan & Associates for private respondents.
SARMIENTO, J.:
Before the Court are five consolidated petitions, 1 docketed as
G.R. Nos. 71169, 74376, 76394, 78182, and 82281 hereof, in the
nature of appeals (by certiorari under Rule 45 of the Rules of Court)
from five decisions of the Court of Appeals, denying specific
performance and damages.
The proceedings were commenced at the first instance by Jose
Sangalang, joined by his wife Lutgarda Sangalang, both residents
of No. 110 Jupiter Street, Makati, Metro Manila (G.R. No. 71169)
to enforce by specific performance restrictive easement upon
property, specifically the Bel- Air Village subdivision in Makati,
Metro Manila, pursuant to stipulations embodied in the deeds of
sale covering the subdivision, and for damages. Later, the
Sangalangs were joined by Felix Gaston, a resident of No. 64
Jupiter Street of the same municipality, and by Mr. and Mrs. Jose
and Alicia Briones, both of No. 66 Jupiter Street. Pending further
proceedings, the Bel-Air Village Association, Inc. (BAVA), an
incorporated homeowners' association, entered its appearance
as plaintiff-in-intervention.
BAVA itself had brought its own complaints, four in number,
likewise for specific performance and damages to enforce the
same 'deed restrictions.' (See G.R. Nos. 74376, 76394, 78182,
and 82281.)
ANTECEDENTS FACTS
I. G.R. No. 71169
The facts are stated in the decision appealed from. We quote:
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(1) Bel-Air Village is located north of Buendia
Avenue extension (now Sen. Gil J. Puyat Ave.)
across a stretch of commercial block from Reposo
Street in the west up to Zodiac Street in the east,
When Bel-Air Village was planned, this block
between Reposo and Zodiac Streets adjoining
Buendia Avenue in front of the village was
designated as a commercial block. (Copuyoc
TSN, p. 10, Feb. 12, 1982).
(2) Bel-Air Village was owned and developed into
a residential subdivision in the 1950s by Makati
Development Corporation (hereinafter referred to
as MDC), which in 1968 was merged with
appellant Ayala Corporation.
(3) Appellees-spouses Sangalang reside at No.
11O Jupiter Street between Makati Avenue and
Reposo Street; appellees-spouses Gaston reside
at No. 64 Jupiter Street between Makati Avenue
and Zodiac Street; appellees-spouses Briones
reside at No. 66 Jupiter Street also between
Makati Avenue and Zodiac Street; while appellee
Bel-Air Village Association, Inc. (hereinafter
referred to as BAVA) is the homeowners'
association in Bel-Air Village which takes care of
the sanitation, security, traffic regulations and
general welfare of the village.
(4) The lots which were acquired by appellees
Sangalang and spouse Gaston and spouse and
Briones and spouse in 1960, 1957 and 1958,
respectively, were all sold by MDC subject to
certain conditions and easements contained in
Deed Restrictions which formed a part of each
deed of sale. The pertinent provisions in said
Deed Restrictions, which are common to all lot
owners in Bel-Air Village, are as follows:
I-BEL-AIR ASSOCIATION
The owner of this lot/s or his successors in
interest is required to be and is automatically a
member of the Bel-Air Association and must abide
by such rules and regulations laid down by the
Association in the interest of the sanitation,
security and the general welfare of the
community.
The association will also provide for and collect
assessments, which will constitute as a lien on the
property junior only to liens of the government for
taxes and to voluntary mortgages for sufficient
consideration entered into in good faith.
II-USE OF LOTS
Subject to such amendments and additional
restrictions, reservations, servitudes, etc., as the
Bel- Air Association may from time to time adopt
and prescribe, this lot is subject to the following
restrictions:
a. This lot/s shall not be subdivided. However,
three or more lots may be consolidated and
subdivided into a lesser number of lots provided
that none of the resulting lots be smaller in area
than the smallest lot before the consolidation and
that the consolidation and subdivision plan be
duly approved by the governing body of the Bel-
Air Association.
b. This lot/s shall only be used for residential
purposes.
c. Only one single family house may be
constructed on a single lot, although separate
servants' quarters or garage may be built.
d. Commercial or advertising signs shall not be
placed, constructed, or erected on this lot. Name
plates and professional signs of homeowners are
permitted so long as they do not exceed 80 x 40
centimeters in size.
e. No cattle, pigs, sheep, goats, ducks, geese,
roosters or rabbits shall be maintained in the lot,
except that pets may be maintained but must be
controlled in accordance with the rulings of the
Association. The term "pets' includes chickens not
in commercial quantities.
f. The property is subject to an easement of two
(2) meters within the lot and adjacent to the rear
and sides thereof not fronting a street for the
purpose of drainage, sewage, water and other
public facilities as may be necessary and
desirable; and the owner, lessee or his
representative shall permit access thereto by
authorized representatives of the Bel-Air
Association or public utility entities for the
purposes for which the easement is created.
g. This lot shall not be used for any immoral or
illegal trade or activity.
h. The owner and/or lessee of this lot/s shall at all
times keep the grass cut and trimmed to reduce
the fire hazard of the property.
xxx xxx xxx
VI-TERM OF RESTRICTIONS
The foregoing restrictions shall remain in force for
fifty years from January 15, 1957, unless sooner
cancelled in its entirety by two thirds vote of
members in good standing of the Bel-Air
Association. However, the Association may, from
time to time, add new ones, amend or abolish
particular restrictions or parts thereof by majority
rule.
VII--ENFORCEMENT OF RESTRICTIONS
The foregoing restrictions may be enjoined and/or
enforced by court action by the Bel-Air
Association, or by the Makati Development
Corporation or its assigns, or by any registered
owner of land within the boundaries of the Bel-Air
Subdivision (Sub-division plan PSD-49226 and
Lot 7-B, Psd-47848) or by any member in good
standing of the Bel-Air association." (Exh. 1 -b;
Exh. 22, Annex "B"). (Appellant's Brief, pp. 4- 6)
(5) When MDC sold the above-mentioned lots to
appellees' predecessors-in-interest, the whole
stretch of the commercial block between Buendia
Avenue and Jupiter Street, from Reposo Street in
the west to Zodiac Street in the east, was still
undeveloped. Access, therefore, to Bel-Air Village
was opened to all kinds of people and even
animals. So in 1966, although it was not part of
the original plan, MDC constructed a fence or wall
on the commercial block along Jupiter Street. In
1970, the fence or wall was partly destroyed by
typhoon "Yoling." The destroyed portions were
subsequently rebuilt by the appellant. (Copuyoc
TSN, pp. 31-34, Feb. 12, 1982). When Jupiter
Street was widened in 1972 by 3.5 meters, the
fence or wall had to be destroyed. Upon request
of BAVA, the wall was rebuilt inside the boundary
of the commercial block. (Copuyoc TSN, pp.
4447, Feb. 12,1982).
(6) When the appellant finally decided to
subdivide and sell the lots in the commercial block
between Buendia and Jupiter, BAVA wrote the
appellant on May 9, 1972, requesting for
confirmation on the use of the commercial lots.
The appellant replied on May 16, 1972, informing
BAVA of the restrictions intended to be imposed
in the sale and use of the lots. Among these
restrictions are: that the building shall have a set
back of 19 meters; and that with respect to
vehicular traffic along Buendia Avenue, entrance
only will be allowed, and along Jupiter Street and
side streets, both entrance and exit will be
allowed.
(7) On June 30, 1972, appellant informed BAVA
that in a few months it shall subdivide and sell the
commercial lots bordering the north side of
Buendia Avenue Extension from Reposo Street
up to Zodiac Street. Appellant also informed
BAVA that it had taken all precautions and will
impose upon the commercial lot owners deed
restrictions which will harmonize and blend with
the development and welfare of Bel-Air Village.
Appellant further applied for special membership
in BAVA of the commercial lot owners. A copy of
the deed restrictions for the commercial lots was
also enclosed. The proposed deed restrictions
shall include the 19 meter set back of buildings
from Jupiter Street, the requirement for parking
space within the lot of one (1) parking slot for
every seventy five (75) meters of office space in
the building and the limitation of vehicular traffic
along Buendia to entrance only, but allowing both
vehicular entrance and vehicular exit through
Jupiter Street and any side street.
In its letter of July 10, 1972, BAVA acknowledged
the above letter of appellant and informed the
latter that the application for special membership
of the commercial lot owners in BAVA would be
submitted to BAVA's board of governors for
decision.
(8) On September 25, 1972, appellant notified
BAVA that, after a careful study, it was finally
decided that the height limitation of buildings on
the commercial lots shall be increased from 12.5
meters to 15 meters. Appellant further informed
BAVA that Jupiter Street shall be widened by 3.5
meters to improve traffic flow in said street. BAVA
did not reply to said letter, but on January 22,
1973, BAVA wrote a letter to the appellant
informing the latter that the Association had
assessed the appellant, as special member of the
association, the amount of P40,795.00 (based on
81,590 square meters at P.50 per square meter)
representing the membership dues to the
commercial lot owners for the year 1973, and
requested the appellant to remit the amount which
its board of governors had already included in its
current budget. In reply, appellant on January 31,
1973 informed BAVA that due to the widening of
Jupiter Street, the area of the lots which were
accepted by the Association as members was
reduced to 76,726 square meters. Thus, the
corresponding dues at P.50 per square meter
should be reduced to P38,363.00. This amount,
therefore, was remitted by the appellant to BAVA.
Since then, the latter has been collecting
membership dues from the owners of the
commercial lots as special members of the
Association. As a matter of fact, the dues were
increased several times. In 1980, the commercial
lot owners were already being charged dues at
the rate of P3.00 per square meter. (Domingo,
TSN, p. 36, March 19, 1980). At this rate, the total
membership dues of the commercial lot owners
amount to P230,178. 00 annually based on the
total area of 76,726 square meters of the
commercial lots.
(9) Meantime, on April 4, 1975, the municipal
council of Makati enacted its ordinance No. 81,
providing for the zonification of Makati (Exh. 18).
Under this Ordinance, Bel-Air Village was
classified as a Class A Residential Zone, with its
boundary in the south extending to the center line
of Jupiter Street (Exh. 18-A).
Thus, Chapter III, Article 1, Section 3.03, par. F.
of the Ordinance provides:
F. Bel-Air Village area, as bounded on the N by
Polaris and Mercedes streets and on the NE by
Estrella Street; on the SE by Epifanio de los
Santos Avenue and on the SW by the center line
of Jupiter Street. Then bounded on the N by the
abandoned MRR Pasig Line; on the E by Makati
Avenue; on the S by the center line of Jupiter
Street and on the W by the center line of Reposo
Street." (Exh. 18-A)
 Similarly, the Buendia Avenue Extension area Thus, the Zoning District Boundaries -Makati, in Annex B of the
was classified as Administrative Office Zone with Ordinance provides:
its boundary in the North-North East Extending
also up to the center line of Jupiter Street (Exh. R-I-Low Intensity Residential
18b).
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Thus, Chapter III, Article I, Section 3.05, par. C. of the Ordinance
provides: 4. Bel-Air 1, 3, 4

C. The Buendia Avenue Extension areas, as Bounded on the North -- J.P. Rizal and Amapola
bounded on the N-NE by the center line of Jupiter St.
Street, on the SE by Epifanio de los Santos
Avenue; on the SW by Buendia Avenue and on
South - Rockwell
the NW by the center line of Reposo Street, then
on the NE by Malugay Street; on the SE by
Buendia Avenue and on the W by Ayala Avenue Northwest - P. Burgos
Extension." (Exh. 18-B)
Southeast - Jupiter
The Residential Zone and the Administrative
Office Zone, therefore, have a common boundary Southwest - Epifanio de los Santos Ave. (EDSA)
along the center line of Jupiter Street.
5. Bel-Air 2
The above zoning under Ordinance No. 81 of
Makati was later followed under the Bounded on the Northwest - J.P. Rizal
Comprehensive Zoning Ordinance for the
National Capital Region adopted by the Metro Southwest - Makati Avenue
Manila Commission as Ordinance 81 -01 on
March 14, 1981 (Exh. 19). However, under this South --- Jupiter
ordinance, Bel-Air Village is simply bounded in the
South-Southeast by Jupiter Street-not anymore Southeast -- Pasig Line
up to the center line of Jupiter Street (Exh. B).
Likewise, the blockdeep strip along the northwest
side of Buendia Avenue Extension from Reposo East - South Avenue" (Exh. 19-b)
to EDSA was classified as a High Intensity
Commercial Zone (Exh. 19-c). xxxxxxxxx

C-3-High Intensity Commercial Zone

2. A block deep strip along the northwest side of
Buendia Ave. Ext. from Reposo to EDSA." (Exh,
19-c)
Under the above zoning classifications, Jupiter
Street, therefore, is a common boundary of Bel-
Air Village and the commercial zone.
(10) Meanwhile, in 1972, BAVA had installed
gates at strategic locations across Jupiter Street
which were manned and operated by its own
security guards who were employed to maintain,
supervise and enforce traffic regulations in the
roads and streets of the village. (Villavicencio,
TSN, pp, 22-25, Oct. 30, 1980; BAVA Petition,
par. 11, Exh. 17).
Then, on January 17, 1977, the Office of the
Mayor of Makati wrote BAVA directing that, in the
interest of public welfare and for the purpose of
easing traffic congestion, the following streets in
Bel-Air Village should be opened for public use:
Amapola Street - from Estrella Street to Mercedes
Street
Amapola Street -junction of Palma Street gate
going to J. Villena Street
Mercedes Street -- from EDSA to Imelda Avenue
and Amapola junction
Zodiac Street - from Mercedes Street to Buendia
Avenue
Jupiter Street -- from Zodiac Street to Reposo
Street connecting Metropolitan Avenue to Pasong
Tamo and V. Cruz Extension intersection
Neptune Street - from Makati Avenue to Reposo
Street Orbit Street - from F. Zobel-Candelaria
intersection to Jupiter Street
Paseo de Roxas - from Mercedes Street to
Buendia Avenue (Exh. 17, Annex A, BAVA
Petition)
On February 10, 1977, BAVA wrote the Mayor of
Makati, expressing the concern of the residents
about the opening of the streets to the general
public, and requesting specifically the indefinite
postponement of the plan to open Jupiter Street to
public vehicles. (Exh. 17, Annex B, BAVA
Petition).
However, BAVA voluntarily opened to the public
Amapola, Mercedes, Zodiac, Neptune and Paseo
de Roxas streets. (Exh. 17-A, Answer of Makati
par. 3-7).
Later, on June 17,1977, the Barangay Captain of
Bel-Air Village was advised by the Office of the
Mayor that, in accordance with the agreement
entered into during the meeting on January 28, 1
977, the Municipal Engineer and the Station
Commander of the Makati Police were ordered to
open for public use Jupiter Street from Makati
Avenue to Reposo Street. Accordingly, he was
requested to advise the village residents of the
necessity of the opening of the street in the
interest of public welfare. (Exh. 17, Annex E,
BAVA Petition).
Then, on June 10, 1977, the Municipal Engineer
of Makati in a letter addressed to BAVA advised
the latter to open for vehicular and pedestrian
traffic the entire portion of Jupiter Street from
Makati Avenue to Reposo Street (Exh. 17, BAVA
Petition, par. 14).
Finally, on August 12, 1977, the municipal officials
of Makati concerned allegedly opened, destroyed
and removed the gates constructed/located at the
corner of Reposo Street and Jupiter Street as well
as the gates/fences located/constructed at Jupiter
Street and Makati Avenue forcibly, and then
opened the entire length of Jupiter Street to public
traffic. (Exh. 17, BAVA Petition, pars. 16 and 17).
(11) Before the gates were-removed, there was
no parking problem or traffic problem in Jupiter
Street, because Jupiter Street was not allowed to
be used by the general public (Villavicencio, TSN,
pp. 24-25, Oct. 30, 1980). However, with the
opening of Zodiac Street from Estrella Street to
Jupiter Street and also the opening to the public
of the entire length of Jupiter Street, there was a
tremendous increase in the volume of traffic
passing along Jupiter Street coming from EDSA
to Estrella Street, then to Zodiac Street to Jupiter
Street, and along the entire length of Jupiter
Street to its other end at Reposo Street.
(Villavicencio, TSN, pp. 30-32, Oct. 30, 1980).
In the meantime, the purchasers of the
commercial lots between Jupiter Street and
Buendia Avenue extension had started
constructing their respective buildings in 1974-
1975. They demolished the portions of the fence
or wall standing within the boundary of their lots.
Many of the owners constructed their own fences
or walls in lieu of the wall and they employed their
own security guards. (TSN, p. 83, Feb. 20,1981;
TSN, pp. 53-54; 72-74, March 20,1981; TSN, pp.
54-55, July 23, 1981).
(12) Then, on January 27, 1978, appellant
donated the entire Jupiter Street from
Metropolitan Avenue to Zodiac Street to BAVA
(Exh. 7)- However, even before 1978, the Makati
Police and the security force of BAVA were
already the ones regulating the traffic along
Jupiter Street after the gates were opened in
1977. Sancianco TSN, pp. 26-30, Oct. 2,1981).
In October, 1979, the fence at the corner of Orbit
and Neptune Streets was opened and removed
(BAVA Petition, par. 22, Exh. 17). The opening of
the whole stretch of Orbit Street from J.P. Rizal
Avenue up to Imelda Avenue and later to Jupiter
Street was agreed to at the conference attended
by the President of BAVA in the office of the
Station Commander of Makati, subject to certain
conditions, to wit:
That, maintenance of Orbit St. up to Jupiter St.
shall be shouldered by the Municipality of Makati.
That, street lights will be installed and
maintenance of the same along Orbit St. from J.P.
Rizal Ave. up to Jupiter St. shall be undertaken by
the Municipality.
That for the security of the residents of San
Miguel Village and Bel-Air Village, as a result of
the opening of Orbit Street, police outposts shall
be constructed by the Municipality of Makati to be
headed by personnel of Station No. 4, in close
coordination with the Security Guards of San ON PLAINTIFFS' COMPLAINT:
Miguel Village and Bel-Air Village." (CF. Exh. 3 to
Counter-Affidavit, of Station Commander, Ruperto Defendant is ordered to pay to the plaintiffs-
Acle p. 253, records)" (Order, Civil Case No. spouses Sangalang the following damages:
34948, Exh. 17-c).
1. The sum of P500,000.00 as actual and
(13) Thus, with the opening of the entire length of consequential damages;
Jupiter Street to public traffic, the different
residential lots located in the northern side of 2. The sum of P2,000,000.00 as moral damages;
Jupiter Street ceased to be used for purely
residential purposes. They became, for all
3. The sum of P500,000.00 as exemplary
purposes, commercial in character.
damages;
(14) Subsequently, on October 29, 1979, the
4. The sum of P100,000.00 as attorney's fees;
plaintiffs-appellees Jose D. Sangalang and
and
Lutgarda D. Sangalang brought the present action
for damages against the defendant-appellant
Ayala Corporation predicated on both breach of 5. The costs of suit.
contract and on tort or quasi-delict A
supplemental complaint was later filed by said ON INTERVENORS FELIX and DOLORES
appellees seeking to augment the reliefs prayed GASTON'S COMPLAINT:
for in the original complaint because of alleged
supervening events which occurred during the Defendant is ordered to pay to the spouses Felix
trial of the case. Claiming to be similarly situated and Dolores Gaston, the following damages:
as the plaintiffs-appellees, the spouses Felix C.
Gaston and Dolores R. Gaston, Jose V. Briones 1 . The sum of P400,000.00 as consequential
and Alicia R. Briones, and the homeowners' damages;
association (BAVA) intervened in the case.
2 The sum of P500,000.00 as moral damages;
(15) After trial on the merits, the then Court of
First Instance of Rizal, Pasig, Metro Manila, 3 The sum of P500,000.00 as exemplary
rendered a decision in favor of the appellees the damages:
dispositive portion of which is as follows:
4 The sum of P50,000.00 as attorney's fees; and
WHEREFORE, judgment is hereby accordingly
rendered as follows: 5 The costs of suit.
ON INTERVENORS JOSE and ALICIA BRIONES'
COMPLAINT:
Defendant is ordered to pay to the spouses Jose
and Alicia Briones, the following damages:
1 . The sum of P400,000.00 as consequential
damages;
2 The sum of P500,000.00 as moral damages;
3 The sum of P500,000.00 as exemplary
damages;
4 The sum of P50,000.00 as attorney's fees; and
5 The costs of suit.
ON INTERVENOR BAVA'S COMPLAINT:
Defendant is ordered to pay intervenor BAVA, the
following damages:
1. The sum of P400,000.00 as consequential
damages;
2. The sum of P500,000.00 as exemplary
damages;
3. The sum of P50,000.00 as attorney's fees; and
4. The costs of suit.
The above damages awarded to the plaintiffs and
intervenors shall bear legal interest from the filing
of the complaint.
Defendant is further ordered to restore/reconstruct
the perimeter wall at its original position in 1966
from Reposo Street in the west to Zodiac Street in
the east, at its own expense, within SIX (6)
MONTHS from finality of judgment.
SO ORDERED.
(Record on Appeal, pp. 400-401) 2
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On appeal, the Court of Appeals 3 rendered a
reversal, and disposed as follows:
ACCORDINGLY, finding the decision appealed
from as not supported by the facts and the law on
the matter, the same is hereby SET ASIDE and
another one entered dismissing the case for lack
of a cause of action. Without pronouncement as
to costs.
SO ORDERED. 4
II. G.R. No. 74376
This petition was similarly brought by BAVA to enforce the
aforesaid restrictions stipulated in the deeds of sale executed by
the Ayala Corporation. The petitioner originally brought the
complaint in the Regional Trial Court of Makati, 5 principally for
specific performance, plaintiff [now, petitioner] alleging that the
defendant [now, private respondent] Tenorio allowed defendant
[Tenorio's co-private respondent] Gonzalves to occupy and convert
the house at 50 Jupiter Street, Bel-Air Village, Makati, Metro Manila,
into a restaurant, without its knowledge and consent, and in violation
of the deed restrictions which provide that the lot and building
thereon must be used only for residential purposes upon which the
prayed for main relief was for 'the defendants to permanently refrain
from using the premises as commercial and to comply with the terms
of the Deed Restrictions." 6 The trial court dismissed the complaint on
a procedural ground, i.e., pendency of an Identical action, Civil Case
No. 32346, entitled "Bel-Air Village Association, Inc. v. Jesus
Tenorio." The Court of Appeals7 affirmed, and held, in addition, that
Jupiter Street "is classified as High density commercial (C-3) zone as
per Comprehensive Zoning Ordinance No. 81-01 for National Capital
Region," 8 following its own ruling in AC-G.R. No. 66649, entitled
"Bel-Air Village Association, Inc. vs. Hy-Land Realty & Development
Corporation, et al."
III. G.R. No. 76394
xxxxxxxxx
Defendants-spouses Eduardo V. Romualdez, Jr.
and Buena Tioseco are the owners of a house
and lot located at 108 Jupiter St., Makati, Metro
Manila as evidenced by Transfer Certificate of
Title No. 332394 of the Registry of Deeds of Rizal.
The fact is undisputed that at the time the
defendants acquired the subject house and lot,
several restrictions were already annotated on the
reverse side of their title; however, for purposes of
this appeal we shall quote hereunder only the
pertinent ones, to wit:
(b,) This lot/shall be used only for residential
purposes.
xxxxxxxxx
IV. Term of Restriction
The foregoing restriction(s) shall remain in force
for fifty years from January 15, 1957, unless
sooner cancelled in its entirety by two-thirds vote
of the members in good standing of the Bel-Air
Association. However, the Association may from
time to time, add new ones, amend or abolish
particular restrictions or parts thereof by majority
rule.
During the early part of 1979, plaintiff noted that
certain renovations and constructions were being
made by the defendants on the subject premises,
for which reason the defendants were advised to
inform the plaintiff of the kind of construction that
was going on. Because the defendants failed to
comply with the request of the plaintiff, the latter's
chief security officer visited the subject premises
on March 23, 1979 and found out that the
defendants were putting up a bake and coffee
shop, which fact was confirmed by defendant Mrs.
Romualdez herself. Thereafter, the plaintiff
reminded defendants that they were violating the
deed restriction. Despite said reminder, the
defendants proceeded with the construction of the
bake shop. Consequently, plaintiff sent
defendants a letter dated April 30, 1979 warning
them that if they will not desist from using the
premises in question for commercial purposes,
they will be sued for violations of the deed
restrictions.
Despite the warning, the defendants proceeded
with the construction of their bake shop. 9
xxxxxxxxx
The trial court 10 adjudged in favor of BAVA. On appeal, the Court of
Appeals 11 reversed, on the strength of its holding in AC-G.R. No.
66649 earlier referred to.
BAVA then elevated the matter to the Court by a petition for which made the conversion of the building into a
review on certiorari. The Court 12 initially denied the petition "for lack commercial one a violation.
of merit, it appearing that the conclusions of the respondent Court of
Appeals that private respondents' bake and coffee shop lies within a Defendants now seek review and reversal on three (3)
commercial zone and that said private respondents are released assignments of errors, namely:
from their obligations to maintain the lot known as 108 Jupiter Street
for residential purposes by virtue of Ordinance No. 81 of the
Municipality of Makati and Comprehensive Zoning Ordinance No. 81- I.
01 of the Metropolitan Manila Commission, are in accord with law
and jurisprudence," 13 for which BAVA sought a reconsideration. THE TRIAL COURT ERRED IN NOT FINDING
Pending resolution, the case was referred to the Second Division of THAT THE REGULATIONS PROMULGATED BY
this Court, 14 and thereafter, to the Court En Banc en consulta. 15 Per THE MUNICIPAL AUTHORITIES IN MAKATI
our Resolution, dated April 29, 1988, we consolidated this case with AND THE MINISTRY OF HUMAN
G.R. Nos. 74376 and 82281. 16 SETTLEMENT'S CHANGING THE CHARACTER
OF THE AREAS IN QUESTION HAD
IV. G.R. No. 78182. RENDERED THE RESTRICTIVE EASEMENT
ON THE TITLE OF THE APPELLANTS
xxxxxxxxx VACATED.

The case stemmed from the leasing by defendant II.

Dolores Filley of her building and lot situated at
No. 205 Reposo Street, Bel-Air Village Makati, THE COURT ERRED IN NOT RULING THAT
Metro Manila to her co-defendant, the advertising BECAUSE THE APPELLEE(S) HAD ALLOWED
firm J. Romero and Associates, in alleged THE USE OF THE PROPERTY WITHIN THE
violation of deed restrictions which stipulated that VILLAGE FOR NON- RESIDENTIAL
Filley's lot could only be used for residential PURPOSES, IT IS NOW ESTOPPED FROM
purposes. Plaintiff sought judgment from the lower ENFORCING THE RESTRICTIVE
court ordering the defendants to "permanently PROHIBITIONS SUBJECT MATTER OF THIS
refrain" from using the premises in question "as CASE.
commercial" and to comply with the terms of the
deed restrictions. III.

After the proper proceedings, the court granted THE COURT ERRED IN NOT FINDING THAT
the plaintiff the sought for relief with the additional THERE EXISTED A BILATERAL CONTRACT
imposition of exemplary damages of P50,000.00 BETWEEN THE PARTIES AND THAT SINCE
and attorney's fees of P10,000.00. The trial court APPELLEE HAD NOT PERFORMED ITS
gave emphasis to the restrictive clauses OBLIGATIONS UNDER THIS ARRANGEMENT
contained in Filley's deed of sale from the plaintiff, THE APPELLANT IN TURN WAS UNDER NO
OBLIGATION TO ANNOTATE THE
RESTRICTIVE PROHIBITIONS ON THE BACK
OF THE TITLE.
Appellants anchor their appeal on the proposition
that the Bel-Air Village area, contrary to plaintiff-
appellee's pretension of being a strictly residential
zone, is in fact commercial and characterize the
restrictions contained in appellant Filley's deed of
sale from the appellee as completely outmoded,
which have lost all relevance to the present-day
realities in Makati, now the premier business hub
of the nation, where there is a proliferation of
numerous commercial enterprises established
through the years, in fact even within the heart of
so-called "residential" villages. Thus, it may be
said that appellants base their position on the
inexorable march of progress which has rendered
at naught the continued efficacy of the
restrictions. Appellant on the other hand, relies on
a rigid interpretation of the contractual stipulations
agreed upon with appellant Filley, in effect
arguing that the restrictions are valid ad infinitum.
The lower court quite properly found that other
commercial establishments exist in the same area
(in fact, on the same street) but ignored it just the
same and said-
The fact that defendants were able to prove the
existence of several commercial establishments
inside the village does not exempt them from
liability for violating some of the restrictions
evidently choosing to accord primacy to
contractual stipulation. 17
xxxxxxxxx
The Court of Appeals 18 overturned the lower court, 19 likewise
based on AC-G.R. No. 66649. The respondent Court observed also
that J. Romero & Associates had been given authority to open a
commercial office by the Human Settlements Regulatory
Commission.
V. G.R. No. 82281
The facts of this case have been based on stipulation. We quote:
COMES NOW, the Parties, assisted by their
respective counsel and to this Honorable Court,
respectfully enter into the following stipulations of
facts, to wit:
1. The parties admit the personal circumstances
of each other as well as their capacities to sue
and be sued.
2. The parties admit that plaintiff BAVA for short)
is the legally constituted homeowners' association
in Bel-Air Subdivision, Makati, Metro Manila.
3. The parties admit that defendant Violets
Moncal is the registered owner of a parcel of land
with a residential house constructed thereon
situated at No. 104 Jupiter Street, Bel-Air Village,
Makati, Metro Manila; that as such lot owner, she
is a member of the plaintiff association.
4. The parties admit that defendant Majal
Development Corporation (Majal for short) is the
lessee of defendant Moncal's house and lot
located at No. 104 Jupiter Street.
5. The parties admit that a deed restrictions is
annotated on the title of defendant Moncal, which
provides, among others, that the lot in question
must be used only for residential purposes;' that
at time Moncal purchased her aforesaid lot in
1959 said deed restrictions was already
annotated in the said title.
6. The parties admit that when Moncal leased her
subject property to Majal, she did not secure the
consent of BAVA to lease the said house and lot
to the present lessee.
7. The parties admit that along Jupiter Street and
on the same side where Moncal's property is
located, there are restaurants, clinics placement
or employment agencies and other commercial or
business establishments. These establishments,
however, were sued by BAVA in the proper court.
8. The parties admit that at the time Moncal
purchased the subject property from the Makati
Development Corporation, there was a perimeter
wall, running along Jupiter Street, which wall was
constructed by the subdivision owner; that at that
time the gates of the entrances to Jupiter Street
were closed to public traffic. In short, the entire
length of Jupiter which was inside the perimeter
wall was not then open to public traffic
9. The parties admit that subsequent thereto,
Ayala tore down the perimeter wall to give way to
the commercial building fronting Buendia Avenue
(now Gil J. Puyat Avenue).
10. The parties admit that on August 12, 1977, the
Mayor of Makati forcibly opened and removed the
street gates constructed on Jupiter Street and
Reposo Street, thereby opening said streets to
the public.
11. The parties admit plaintiffs letters of October
10, 23 and 31, 1984; as well as defendants'
letters-reply dated October 17 and 29, 1984. 20
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The trial court 21 dismissed the petitioner's complaint, a dismissal
affirmed on appeal, 22 According to the appellate court, the opening
of Jupiter Street to human and vehicular traffic, and the
commercialization of the Municipality of Makati in general, were
circumstances that had made compliance by Moncal with the
aforesaid "deed restrictions" "extremely difficult and
unreasonable," 23 a development that had excused compliance
altogether under Article 1267 of the Civil Code.
VI. The cases before the Court; the Court's
decision.
In brief, G.R. Nos. 74376, 76394, 78182, and 82281 are efforts to
enforce the "deed restrictions" in question against specific
residents (private respondents in the petitions) of Jupiter Street
and with respect to G.R. No. 78182, Reposo Street. The private
respondents are alleged to have converted their residences into
commercial establishments (a restaurant in G.R. No. 74376, a
bakery and coffee shop in G.R. No. 76394, an advertising firm in
G.R. No. 78182; and a construction company, apparently, in G.R.
No. 82281) in violation of the said restrictions.24
Their mother case, G. R. No. 71169 is, on the other hand, a
petition to hold the vendor itself, Ayala Corporation (formerly
Makati Development Corporation), liable for tearing down the
perimeter wall along Jupiter Street that had therefore closed its
commercial section from the residences of Bel-Air Village and
ushering in, as a consequence, the full "commercialization" of
Jupiter Street, in violation of the very restrictions it had authored.
As We indicated, the Court of Appeals dismissed all five appeals
on the basis primarily of its ruling in AC-G.R. No. 66649, "Bel-Air
Village, Inc. v. Hy-Land Realty Development Corporation, et al.,"
in which the appellate court explicitly rejected claims under the
same 'deed restrictions" as a result of Ordinance No. 81 enacted
by the Government of the Municipality of Makati, as well as
Comprehensive Zoning Ordinance No. 8101 promulgated by the
Metropolitan Manila Commission, which two ordinances allegedly
allowed the use of Jupiter Street both for residential and
commercial purposes. It was likewise held that these twin
measures were valid as a legitimate exercise of police power.
The Court of Appeals' reliance on Ordinance Nos. 81. and 8101
is now assailed in these petitions, particularly the Sangalang, et
al. petition.
Aside from this fundamental issue, the petitioners likewise raise
procedural questions. G.R. No. 71169, the mother case, begins
with one.
1. G.R. No. 71169
In this petition, the following questions are specifically put to the
Court:
May the Honorable Intermediate Appellate Court
reverse the decision of the trial court on issues
which were neither raised by AYALA in its
Answers either to the Complaint or Supplemental
Complaint nor specifically assigned as one of the
alleged errors on appeal? 25
May the Honorable Intermediate Appellate Court
arbitrarily ignore the decisive findings of fact of the
trial court, even if uncontradicted and/or
documented, and premised mainly on its own
unsupported conclusions totally reverse the trial
court's decision? 26
May the Honorable Intermediate Appellate Court
disregard the trial court's documented findings
that respondent Ayala for its own self-interest and
commercial purposes contrived in bad faith to do
away with the Jupiter Street perimeter wall it put
up three times which wall was really intended to
separate the residential from the commercial
areas and thereby insure the privacy and security
of Bel Air Village pursuant to respondent Ayala's
express continuing representation and/or
covenant to do so?27
a.
The first question represents an attack on the appellate court's
reliance on Ordinances Nos. 81 and 81-01, a matter not
supposedly taken up at the trial or assigned as an error on
appeal. As a rule, the Court of Appeals (then the Intermediate
Appellate Court) may determine only such questions as have
been properly raised to it, yet, this is not an inflexible rule of
procedure. In Hernandez v. Andal, 28 it was stated that "an
unassigned error closely related to an error properly assigned, or
upon which the determination of the question raised by the error
properly assigned is dependent, will be considered by the appellate
court notwithstanding the failure to assign it as error." 29
In Baquiran v. Court of Appeals, 30 we referred to the " modern
trend of procedure . . . according] the courts broad discretionary
power" 31 and in which we allowed consideration of matters "having
some bearing on the issue submitted which the parties failed to raise
or the lower court ignore[d]. 32 And in Vda. de Javellana v. Court of
Appeals, 33 we permitted the consideration of a 'patent error' of the
trial court by the Court of Appeals under Section 7, of Rule 51, of the
Rules of Court, 34 although such an error had not been raised in the
brief. But what we note is the fact that the Ayala Corporation did
raise the zoning measures as affirmative defenses, first in its
answers 35 and second, in its brief, 36 and submitted at the trial as
exhibits. 37 There is accordingly no cause for complaint on the part of
the petitioners for Ayala's violation of the Rules. But while there was
reason for the consideration, on appeal, of the said zoning
ordinances in question, this Court nevertheless finds as inaccurate
the Court of Appeals' holding that such measures, had "in effect,
[made] Jupiter Street ... a street which could be used not only for
residential purposes," 38 and that "[It lost its character as a street for
the exclusive benefit of those residing in Bel-Air Village
completely." 39
Among other things, there is a recognition under both Ordinances
Nos. 81 and 8 1-01 that Jupiter Street lies as the boundary
between Bel-Air Village and Ayala Corporation's commercial
section. And since 1957, it had been considered as a boundary
not as a part of either the residential or commercial zones of
Ayala Corporation's real estate development projects. Thus, the
Bel-Air Village Association's articles of incorporation state that
Bel-Air Village is 'bounded on the NE., from Amapola St., to de
los Santos Ave., by Estrella St., on the SE from Extrella St., to
Pedestrian Lane by E. De los Santos Ave., on the SW., from
Pedestrian Lane to Reposo St., by Jupiter Street
. . . . 40 Hence, it cannot be said to have been "for the exclusive
benefit" of Bel-Air Village residents.
We come to the perimeter wall then standing on the commercial
side of Jupiter Street the destruction of which opened the street to
the public. The petitioners contend that the opening of the
thoroughfare had opened, in turn, the floodgates to the
commercialization of Bel-Air Village. The wall, so they allege, was
designed precisely to protect the peace and privacy of Bel-Air
Village residents from the din and uproar of mercantile pursuits,
and that the Ayala Corporation had committed itself to maintain it.
It was the opinion of the Court of Appeals, as we said, that
Ayala's liability therefor, if one existed, had been overtaken by the
passage of Ordinances Nos. 81 and 82-01, opening Jupiter Street
to commerce.
It is our ruling, we reiterate, that Jupiter Street lies as a mere
boundary, a fact acknowledged by the authorities of Makati and
the National Government and, as a scrutiny of the records
themselves reveals, by the petitioners themselves, as the articles
of incorporation of Bel-Air Village Association itself would confirm.
As a consequence, Jupiter Street was intended for the use by
both -the commercial and residential blocks. It was not originally
constructed, therefore, for the exclusive use of either block, least
of all the residents of Bel-Air Village, but, we repeat, in favor of
both, as distinguished from the general public.
When the wall was erected in 1966 and rebuilt twice, in 1970 and
1972, it was not for the purpose of physically separating the two
blocks. According to Ayala Corporation, it was put up to enable
the Bel-Air Village Association "better control of the security in the
area, 41 and as the Ayala Corporation's "show of goodwill " 42 a view
we find acceptable in the premises. For it cannot be denied that at
that time, the commercial area was vacant, "open for [sic] animals
and people to have access to Bel-Air Village." 43 There was hence a
necessity for a wall.
In any case, we find the petitioners' theory, that maintaining the
wall was a matter of a contractual obligation on the part of Ayala,
to be pure conjecture. The records do not establish the existence
of such a purported commitment. For one, the subdivision plans
submitted did not mention anything about it. For another, there is
nothing in the "deed restrictions" that would point to any covenant
regarding the construction of a wall. There is no representation or
promise whatsoever therein to that effect.
With the construction of the commercial buildings in 1974, the
reason for which the wall was built- to secure Bel-Air Village from
interlopers had naturally ceased to exist. The buildings
themselves had provided formidable curtains of security for the
residents. It should be noted that the commercial lot buyers
themselves were forced to demolish parts of the wall to gain
access to Jupiter Street, which they had after all equal right to
use.
In fine, we cannot hold the Ayala Corporation liable for damages
for a commitment it did not make, much less for alleged resort to
machinations in evading it. The records, on the contrary, will
show that the Bel-Air Village Association had been informed, at
the very outset, about the impending use of Jupiter Street by
commercial lot buyers. We quote:
xxxxxxxxx
1. Exh. I of appellee, the memorandum of Mr.
Carmelo Caluag, President of BAVA, dated May
10, 1972, informing the BAVA Board of Governors
and Barrio Council members about the future use
of Jupiter Street by the lot owners fronting
Buendia Avenue. The use of Jupiter Street by the
owners of the commercial lots would necessarily
require the demolition of the wall along the
commercial block adjoining Jupiter Street.
2. Exh. J of appellee, the minutes of the joint
meeting of BAVA Board of Governors and the
Bel-Air Barrio Council where the matter that
"Buendia lot owners will have equal rights to use
Jupiter Street," and that Ayala's "plans about the
sale of lots and use of Jupiter Street" were
precisely taken up. This confirms that from the
start BAVA was informed that the commercial lot
owners will use Jupiter Street and that necessarily
the wall along Jupiter Street would be
demolished.
3. Exh. 10, the letter of Mr. Demetrio Copuyoc to
the President of BAVA, dated May 16, 1972,
expressly stating that vehicular entrance and exit
to the commercial lots would be allowed along
Jupiter and side streets.
4. Exhs. 27, 27-A, 27-B, the letter of Atty.
Salvador J. Lorayes dated June 30, 1972, with
enclosed copy of proposed restriction for the
commercial lots to BAVA. He proposed restriction
again expressly stated that "Vehicular entrances
and exits are allowed thru Jupiter and any side
streets."
5. Exh. L of appellee, the minutes of the meeting
of the members of BAVA, dated August 26, 1972,
where it is stated "Recently, Ayala Corporation
informed the Board that the lots fronting Buendia
Avenue will soon be offered for sale, and that
future lot owners will be given equal rights to use
Jupiter Street as well as members of the
Association."
6. Exh. 25, the letter of Atty. Lorayes dated
September 25, 1972, informing BAVA of the
widening of Jupiter Street by 3.5 meters to
improve traffic flow in said street to benefit both
the residents of Bel-Air and the future owners of
the commercial lots. 44
The petitioners cannot successfully rely on the alleged promise
by Demetrio Copuyoc, Ayala's manager, to build a "[f]ence along
Jupiter with gate for entrance and/or exit 45 as evidence of Ayala's
alleged continuing obligation to maintain a wall between the
residential and commercial sections. It should be observed that the
fence referred to included a "gate for entrance and or exit" which
would have defeated the purpose of a wall, in the sense the
petitioners would put in one, that is to say, an impenetrable barrier.
But as Ayala would point out subsequently, the proposed fence was
not constructed because it had become unnecessary when the
commercial lot owners commenced constructions thereon.
Be that as it may, the Court cannot visualize any purported
obligation by Ayala Corporation to keep the wall on the strength
of this supposed promise alone. If truly Ayala promised anything
assuming that Capuyoc was authorized to bind the corporation
with a promise it would have been with respect to the fence. It
would not have established the pre-existing obligation alleged
with respect to the wall.
Obligations arise, among other things, from contract. 46 If Ayala,
then, were bound by an obligation, it would have been pursuant to a
contract. A contract, however, is characterized by a "meeting of
minds between two persons . 47 As a consensual relation, it must be
shown to exist as a fact, clearly and convincingly. But it cannot be
inferred from a mishmash of circumstances alone disclosing some
kind of an "understanding," when especially, those disparate
circumstances are not themselves incompatible with contentions that
no accord had existed or had been reached. 48
The petitioners cannot simply assume that the wall was there for
the purpose with which they now give it, by the bare coincidence
that it had divided the residential block from the commercial
section of Bel-Air. The burden of proof rests with them to show
that it had indeed been built precisely for that objective, a proof
that must satisfy the requirements of our rules of evidence. It
cannot be made to stand on the strength of plain inferences.
b.
This likewise answers the petitioners' second query, whether or
not the Court of Appeals had "arbitrarily ignore(d) the decisive
findings of the trial court." 49 i.e., findings pointing to alleged acts
performed by the Ayala Corporation proving its commitment to
maintain the wall abovesaid. Specifically, the petitioners refer to,
among other things: (1) Ayala's alleged announcement to Bel- Air
Village Association members that "[the perimeter wall along Jupiter
Street will not be demolished," 50 (2) Ayala's alleged commitment
"during the pendency of the case in the trial court" to restore the wall;
(3) alleged assurances by Copuyoc that the wall will not be removed;
(4) alleged contrivances by the corporation to make the association
admit as members the commercial lot buyers which provided them
equal access to Jupiter Street; and (5) Ayala's donation to the
association of Jupiter Street for "private use" of Bel-Air residents. 51
682 (1903), where it was held that "whether the plaintiffs services
were solicited or whether they were offered to the defendant for
his assistance, inasmuch as these services were accepted and
made use of by the latter, we must consider that there was a tacit
and mutual consent as to the rendition of services." (At 686.) In
that case, the defendant had enormously benefitted from the
services that entitled the plaintiff to compensation on the theory
that no one may unjustly enrich himself at the expense of another
(Solutio indebiti) The facts of this case differ.
As we stated, the Ayala Corporation's alleged conduct prior to or
during the proceedings below are not necessarily at war with
claims that no commitment had been in fact made.
With respect to Ayala's alleged announcement before the
association, the Court does not agree that Ayala had categorically
assumed as an obligation to maintain the wall "perpetually," i.e.,
until the year 2007 (the expiration date under the "deed
restrictions.") There is nothing in its statement that would bare
any commitment. In connection with the conference between the
parties "during the pendency" of the trial, it is to be noted that the
Ayala Corporation denies having warranted the restoration of the
said wall therein. What, on the other hand, appears in the records
is the fact that Ayala did make that promise, but provided that the
Mayor allowed it. It turned out, however, that the Mayor balked at
the Idea. 52 But assuming that Ayala did promise to rebuild the wall
(in that conference), it does not seem to us that it did consequently
promise to maintain it in perpetuity.
It is unfair to say, as the trial court did, that the Ayala had
"contrived to make future commercial lot owners special
members of BAVA and thereby acquire equal right with the
regular members thereof to use Jupiter Street 53 since, as we
stated, the commercial lot buyers have the right, in any event, to
make use of Jupiter Street, whether or not they are members of the
association. It is not their memberships that give them the right to
use it. They share that right with Bel-Air residents from the outset.
The objective of making the commercial lot owners special
members of the Bel-Air Village Association was not to accord
them equal access to Jupiter Street and inferentially, to give them
the right to knock down the perimeter wall. It was, rather, to
regulate the use of the street owing precisely to the "planned"
nature of Ayala's development project, and real estate
development in general, and this could best be done by placing
the commercial lot owners under the association's jurisdiction.
Moreover, Ayala's overtures with the association concerning the
membership of commercial lot buyers therein have been shown
to be neither perfidious nor unethical nor devious (paraphrasing
the lower court). We quote anew:
xxxxxxxxx
(7) On June 30, 1972, appellant informed BAVA
that in a few months it shall subdivide and sell the
commercial lots bordering the north side of
Buendia Avenue Extension from Reposo Street
up to Zodiac Street. Appellant also informed
BAVA that it had taken all precautions and will
impose upon the commercial lot owners deed
restrictions which will harmonize and blend with
the development and welfare of Bel-Air Village.
Appellant further applied for special membership
in BAVA of the commercial lot owners. A copy of
the deed restrictions for the commercial lots was
also enclosed. The proposed deed restrictions
shall include the 19 meter set back of buildings
from Jupiter Street, the requirement for parking
space within the lot of one (1) parking slot for
every seventy five (75) meters of office space in
the building and the limitation of vehicular traffic
along Buendia to entrance only, but allowing both
vehicular entrance and vehicular exit through
Jupiter Street and any side street.
In its letter of July 10, 1972, BAVA acknowledged the above letter
of appellant and informed the latter that the application for special
membership of the commercial lot owners in BAVA would be
submitted to BAVA's board of governors for decision.
(8) On September 25,1972, appellant notified
BAVA that, after a careful study, it was finally
decided that the height limitation of buildings on
the commercial lots shall be increased from 12.5
meters to 15 meters. Appellant further informed
BAVA that Jupiter Street shall be widened by 3.5
meters to improve traffic flow in said street. BAVA
did not reply to said letter, but on January 22,
1973, BAVA wrote a letter to the appellant
informing the latter that the Association had
assessed the appellant, as special member of the
association, the amount of P40,795.00 (based on
81,590 square meters at P.50 per square meter)
representing the membership dues of the
commercial lot owners for the year 1973, and
requested the appellant to remit the amount which
its board of governors had already included in its
current budget. In reply, appellant on January 31,
1973 informed BAVA that due to the widening of
Jupiter Street, the area of the lots which were
accepted by the Association as members was
reduced to 76,726 square meters. Thus, the
corresponding due at P.50 per square meter
should be reduced to P38,363.00. This amount,
 therefore, was remitted by the appellant to BAVA.
Since then, the latter has been collecting
membership dues from the owners of the
commercial lots as special members of the
Association. As a matter of fact, the dues were
increased several times. In 1980, the commercial
lot owners were already being charged dues at
the rate of P3.00 per square meter. (Domingo,
TSN, p. 36, March 19, 1980). At this rate, the total
membership dues of the commercial lot owners
amount to P230,178.00 annually based on the
total area of 76,726 square meters of the
commercial lots. 54
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The alleged undertaking, finally, by Ayala in the deed of donation
(over Jupiter Street) to leave Jupiter Street for the private use of
Bel-Air residents is belied by the very provisions of the deed. We
quote:
xxxxxxxxx
IV. That the offer made by the DONOR had been
accepted by the DONEE subject to the condition
that the property will be used as a street for the
use of the members of the DONEE, their families,
personnel, guests, domestic help and, under
certain reasonable conditions and restrictions, by
the general public, and in the event that said lots
or parts thereof cease to be used as such,
ownership thereof shall automatically revert to the
DONOR. The DONEE shall always have Reposo
Street, Makati Avenue, and Paseo de Roxas open
for the use of the general public. It is also
understood that the DONOR shall continue the
maintenance of the street at its expense for a
period of three years from date hereof." (Deed of
Donation, p. 6, Exh. 7) 55
xxxxxxxxx
The donation, on the contrary, gave the general public equal right
to it.
The Court cannot then say, accepting the veracity of the
petitioners' facts" enumerated above, that the Ayala Corporation
may be held liable for specific performance of a demandable
obligation, let alone damages.
The Court adds that Ayala can hardly be held responsible for the
alleged deterioration of "living and environmental conditions" 56 of
the Bel-Air area, as a consequence of "Ayala's authorized demolition
of the Jupiter perimeter wall in 1974-1975. " 57 We agree with Ayala
that until 1976, "there was peace and quiet" at Jupiter Street, as the
petitioners' (Sangalang, Gaston, and Briones) complaints admit.
Hence, the degeneration of peace and order in Bel-Air cannot be
ascribed to the destruction of the wall in 1974 and 1975.
What Ayala submits as the real cause was the opening of Jupiter
Street to vehicular traffic in 1977., 58 But this was upon orders of the
Mayor, and for which the homeowners' association had precisely
filed suit (Civil Case No. 34998) 59 to contest the act of the Mayor.
c.
This likewise disposes of the third question presented. The
petitioners' reliance on Ayala's alleged conduct (proving its
alleged commitment), so we have ruled, is not well-taken. Ayala's
alleged acts do not, by themselves, reflect a commitment to
maintain the wall in dispute. It cannot be therefore said that the
Court of Appeals "arbitrarily ignore(d]" 60 the lower court's findings.
Precisely, it is the duty of the appellate court to review the findings of
the trial judge, be they of fact or law. 61 It is not bound by the
conclusions of the judge, for which reason it makes its own findings
and arrives at its own conclusions. Unless a grave abuse of
discretion may be imputed to it, it may accept or reject the lower
tribunal's determinations and rely solely on the records.
Accordingly, the Court affirms the Court of Appeals' holding that
the Ayala Corporation, in its dealings with the petitioners, the Bel-
Air Village Association in particular, had "acted with justice, gave
the appellees [petitioners] their due and observed honesty and
good faith." 62 "Therefore, under both Articles 19 and 21 of the Civil
Code, the appellant [Ayala] cannot be held liable for damages." 63
2. G.R. Nos. 74376, 76394, 78182, & 82281
Our decision also resolves, quite anticlimactically, these
companion cases. But we do so for various other reasons. In the
Sangalang case, we absolve the Ayala Corporation primarily
owing to our finding that it is not liable for the opening of Jupiter
Street to the general public. Insofar as these petitions are
concerned, we likewise exculpate the private respondents, not
only because of the fact that Jupiter Street is not covered by the
restrictive easements based on the "deed restrictions" but chiefly
because the National Government itself, through the Metro
Manila Commission (MMC), had reclassified Jupiter Street into
high density commercial (C-3) zone, 64 pursuant to its Ordinance
No. 81-01. Hence, the petitioners have no cause of action on the
strength alone of the said "deed restrictions.
In view thereof, we find no need in resolving the questions raised
as to procedure, since this disposition is sufficient to resolve
these cases.
It is not that we are saying that restrictive easements, especially
the easements herein in question, are invalid or ineffective. As far
as the Bel-Air subdivision itself is concerned, certainly, they are
valid and enforceable. But they are, like all contracts, subject to
the overriding demands, needs, and interests of the greater
number as the State may determine in the legitimate exercise of
police power. Our jurisdiction guarantees sanctity of contract and
is said to be the "law between the contracting parties, 65 but while
it is so, it cannot contravene 'law, morals, good customs, public
order, or public policy. 66 Above all, it cannot be raised as a deterrent
to police power, designed precisely to promote health, safety, peace,
and enhance the common good, at the expense of contractual rights,
whenever necessary. In Ortigas & Co., Limited Partnership v. Feati
Bank and Trust Co., 67 we are told:
xxxxxxxxx
2. With regard to the contention that said
resolution cannot nullify the contractual
obligations assumed by the defendant-appellee
referring to the restrictions incorporated in the
deeds of sale and later in the corresponding
Transfer Certificates of Title issued to defendant-
appellee it should be stressed, that while non-
impairment of contracts is constitutionally
guaranteed, the rule is not absolute, since it has
to be reconciled with the legitimate exercise of
police power, i.e., "the power to prescribe
regulations to promote the health, morals, peace,
education, good order or safety and general
welfare of the people.' Invariably described as
"the most essential, insistent, and illimitable of
powers" and "in a sense, the greatest and most
powerful attribute of government," the exercise of
the power may be judicially inquired into and
corrected only if it is capricious, whimsical, unjust
or unreasonable, there having been a denial of
due process or a violation of any other applicable
constitutional guarantee. As this Court held
through Justice Jose P. Bengson in Philippine
Long Distance Company vs. City of Davao, et al.
police power 'is elastic and must be responsive to
various social conditions; it is not confined within
narrow circumscriptions of precedents resting on
past conditions; it must follow the legal progress
 of a democratic way of life.' We were even more
emphatic in Vda. de Genuino vs. The Court of
agrarian Relations, et al., when We declared: "We
do not see why public welfare when clashing with
the individual right to property should not be made
to prevail through the state's exercise of its police
power."
should hold otherwise other than for the supposed "non-
impairment" guaranty of the Constitution, which, as we have
declared, is secondary to the more compelling interests of
general welfare. The Ordinance has not been shown to be
capricious or arbitrary or unreasonable to warrant the reversal of
the judgments so appealed. In that connection, we find no
reversible error to have been committed by the Court of Appeals.

Resolution No. 27, 1960 declaring the western WHEREFORE, premises considered, these petitions are DENIED
part of High way 54, now E. de los Santos Avenue No pronouncement as to costs.
(EDSA, for short) from Shaw Boulevard to the
Pasig River as an industrial and commercial zone, IT IS SO ORDERED.
was obviously passed by the Municipal Council of
Mandaluyong, Rizal in the exercise of police
power to safeguard or promote the health, safety,
peace, good order and general welfare of the
people in the locality. Judicial notice may be taken
of the conditions prevailing in the area, especially
where Lots Nos. 5 and 6 are located. The lots
themselves not only front the highway; industrial
and commercial complexes have flourished about
the place. EDSA, a main traffic artery which runs
through several cities and municipalities in the
Metro Manila area, supports an endless stream of
traffic and the resulting activity, noise and
pollution are hardly conducive to the health, safety
or welfare of the residents in its route. Having
been expressly granted the power to adopt zoning
and subdivision ordinances or regulations, the
municipality of Mandaluyong, through its
Municipal Council, was reasonably, if not
perfectly, justified under the circumstances, in
passing the subject resolution. 68

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Undoubtedly, the MMC Ordinance represents a legitimate

exercise of police power. The petitioners have not shown why we