SECOND DIVISION
RIDGEWOOD ESTATE, INC. G.R. No. 166751
(Erroneously sued as Camella
Homes), Present:
Petitioner,
PUNO,
J., Chairman,
SANDOVAL-GUTIERREZ,
- versus - AZCUNA, and
GARCIA,
JJ.
Promulgated:
EXPEDITO BELAOS,
Respondent.
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D E C I S I O N
PUNO, J.:
This is a petition for review of the decision of the Court
of Appeals dated
Petitioner
is a subdivision developer that sells properties under the trade name “Camella Homes.” Respondent
Expedito Belaos entered
into a contract to sell with petitioner for the purchase of a house and lot at
Tierra P299,908.00,
equivalent to the down payment and six monthly amortizations previously paid by
respondent, but it nonetheless continued to encash
the other postdated checks, to the prejudice of respondent.
Respondent
filed before the Regional Trial Court of Manila a complaint for damages against
Camella Homes for encashing
the postdated checks despite repeated demands to return them and refrain from encashing them in view of the recission
of the contract to sell.
Petitioner
filed a motion to dismiss. It argued
that Camella Homes is not a real party-in-interest
and the complaint states no cause of action as the contract to sell was entered
into by and between Expedito L. Belaos
and Ridgewood Estate, Inc. It further argued that the complaint was defective
since Camella Homes is not a natural or juridical
person, hence, it is not an entity authorized by law to be a party to a civil
suit.
The
trial court denied the motion to dismiss. It applied the doctrine on
corporation by estoppel under Section 21 of the
Corporation Code which states:
Section 21.
Corporation by estoppel.—All
persons who assume to act as a corporation knowing it to be without authority
to do so shall be liable as general partners for all debts, liabilities and
damages incurred or arising as a result thereof: Provided, however, That when any such
ostensible corporation is sued on any transaction entered by it as a
corporation or on any tort committed by it as such, it shall not be allowed to
use as a defense its lack of corporate personality.
One who
assumes an obligation to an ostensible corporation as such, cannot resist
performance thereof on the ground that there was in fact no corporation.
Petitioner filed a petition for
certiorari before the Court of Appeals.
In addition to its contention that Camella
Homes was not a real party-in-interest,
petitioner also raised the argument that the trial court had no jurisdiction
over the suit, as the subject matter of the complaint was within the exclusive
jurisdiction of the Housing and Land Use Regulatory Board (HLURB).
In its decision dated
Private
respondent’s complaint contains allegations that Ridgewood Estate’s (sic)
deliberately and intentionally encashed the postdated
checks despite knowledge of the contract’s recission. Respondent prayed for the award of actual,
moral and exemplary damages due to his humiliation and loss of credibility with
the banking community and among his colleagues caused by petitioner’s alleged
malicious acts.
Respondent
Belaos is not claiming refund or any other claim from
a subdivision developer. He does not
demand for specific performance of contractual and statutory obligations of
delivering the property to him. In the
cases that reached the Supreme Court, the ruling has consistently been that the
NHA or the HLURB has jurisdiction over complaints arising from contracts
between the subdivision developer and the lot buyer or those aimed at
compelling the subdivision developer to comply with its contractual and statutory
obligations to make the subdivision a better place to live in. It has already been admitted by both parties
that the contract has already been rescinded and that
Petitioner filed a motion for
reconsideration which was denied by the Court of Appeals in its resolution
dated
Petitioner
raises the following arguments in the case at bar:
1. That
the honorable court failed to consider that the lower court acted with grave
abuse of discretion when the latter assumed jurisdiction over a matter which
the law already vests with the Housing and Land Use Regulatory Board.
2. That a perusal of the order of the lower court reveals that it committed grave abuse of discretion when it anchored itself on an erroneous finding that Camella Homes allegedly is a corporation by estoppel.
3. That the Honorable
Court of Appeals failed to consider that the lower court committed grave abuse
of discretion when it failed to consider that the complaint filed by private
respondent has no cause of action for failure to implead
the real party in interest.
4. That the Honorable
Court of Appeals failed to consider that the lower court committed grave abuse
of discretion when it ordered Camella Homes, which
has no legal capacity to be sued[,] to submit an answer.[2]
We affirm the decision of the Court
of Appeals.
First, the trial court correctly
assumed jurisdiction over the complaint filed by respondent against
petitioner.
Section 1 of Presidential Decree No.
1344 provides for the jurisdiction of HLURB (then National Housing Authority),
thus:
Sec. 1. In the
exercise of its function to regulate the real estate trade and business and in
addition to its powers provided for in Presidential Decree No. 957, the
National Housing Authority shall have exclusive jurisdiction to hear and decide
the cases of the following nature:
a. Unsound real estate business practices;
b. Claims involving refund and any other claims filed by subdivision lot or condominium unit buyer against the project owner, developer, dealer, broker or salesman; and
c. Cases
involving specific performance of contractual and statutory obligations filed by
buyers of subdivision lot or condominium unit against the owner, developer,
dealer, broker or salesman.
The Court held in Roxas
v. Court of Appeals[3]
that the mere relationship between the
parties, i.e., that of being subdivision owner/developer and subdivision
lot buyer, does not automatically vest jurisdiction in the HLURB. For an action to fall within the exclusive
jurisdiction of the HLURB, the decisive element is the nature of the action as
enumerated in Section 1 of P.D. No. 1344.
The HLURB has jurisdiction over complaints aimed at compelling the
subdivision developer to comply with its contractual and statutory
obligations.
The complaint filed by respondent
against petitioner was one for damages. It
prayed for the payment of moral, actual and exemplary damages by reason of petitioner’s
malicious encashment of the checks even after the rescission of the contract to
sell between them. Respondent claimed
that because of petitioner’s malicious and fraudulent acts, he suffered
humiliation and embarrassment in several banks, causing him to lose his
credibility and good standing among his colleagues.[4]
Such action falls within the jurisdiction of regular courts, not the
HLURB.
Second, we observe that respondent’s
complaint was actually directed against herein petitioner, Ridgewood Estate,
Inc., although it named Camella Homes as respondent therein.
The complaint itself referred to Ridgewood Estate, Inc. as the authorized
representative of Camella Homes. Petitioner cannot use the lack of juridical
personality by Camella Homes as reason to evade its
liability, if any, to petitioner.
Petitioner admittedly uses the name “Camella
Homes” as its business name. Hence, to
the buyers, Camella Homes and Ridgewood Estate, Inc.
are one and the same. A reading of the
complaint would show that respondent was essentially suing petitioner, it being
the seller of the house and lot he intended to purchase. We agree with the Court of Appeals’ ruling
that the remedy in this case is not the dismissal of the case but the joinder of the proper party.[5] The appellate court correctly explained:
Dismissal
of the complaint is not the remedy since the Court a quo properly
acquired jurisdiction [over] the action for damages. In its pleadings before the trial court,
defendant Camella Homes alleges that it is not a
juridical entity, not the real party in interest and pointed to Ridgewood
Estates [sic], Inc. as the party liable to Belaos. In its petition before [u]s, “Ridgewood
Estates [sic], Inc. erroneously sued as Camella
Homes” presented itself as one of the developers of Camella
Homes, specifically that of Tierra Nevada Subdivision of which respondent Belaos is a buyer, then it claims to be the real party in
interest in the controversy by admitting it entered into a Contract to Sell
with Belaos, [then] tries to exculpate Camella Homes by alleging that the latter is not a
juridical entity and alleges that it is the HLURB which has jurisdiction over
the controversy.
The
Regional Trial Court did not commit grave abuse of discretion in denying the
motion to dismiss and ordering defendant Camella
Homes to file an answer. Assuming arguendo that petitioner
We, therefore, find that the trial
court did not err in denying petitioner’s motion to dismiss.
IN VIEW WHEREOF, the petition is DENIED.
SO ORDERED.
REYNATO
S. PUNO
Associate Justice
WE
CONCUR:
CANCIO C. GARCIA
Associate Justice
I attest that the conclusions in the
above Decision were reached in consultation before the case was assigned to the
writer of the opinion of the Court’s Division.
REYNATO S. PUNO
Associate Justice
Chairman
Pursuant to Section 13, Article VIII of the Constitution,
and the Division Chairman’s Attestation, it is hereby certified that the
conclusions in the above Decision were reached in consultation before the case
was assigned to the writer of the opinion of the Court’s Division.
ARTEMIO
V. PANGANIBAN
Chief
Justice