Republic of the
Supreme Court
THIRD DIVISION
JIN-JIN
Petitioner,
Present:
YNARES-SANTIAGO,
J.,
Chairperson,
- versus - AUSTRIA-MARTINEZ,
CALLEJO,
SR.,
CHICO-NAZARIO,
and
NACHURA,
JJ.
SPOUSES
REYNATO D.
SARMIENTO
and LENI C.
SARMIENTO
and IA-JAN
SARMIENTO
REALTY, INC., Promulgated:
Respondents. March 27, 2007
x-
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D E C I S I O N
AUSTRIA-MARTINEZ,
J.:
This resolves the Petition for Review
on Certiorari under Rule 45 of the Rules of Court assailing the
The facts are of record.
In a Contract to Buy and Sell[3]
dated P824,000.00, P300,000.00 of
which was paid by P15,074.43.
Before
the purchase price could be paid in full, P584,355.10 while the latter agreed to
surrender possession of the residential lot to the former.
On
P760,000.00
with interest.[6]
Spouses Sarmiento wrote back that they
intend to refund the amount within 90 days.[7]
When Spouses Sarmiento failed to
refund
IJSRI is actually the complainant in a
case for specific performance filed against P195,727.12) for which it issued
corresponding IJSRI official receipts;[13]
and that Santos defaulted, leaving an unpaid balance of P2,414,964.58.[14]
The case was assigned to Arbiter Atty.
Joselito Melchor (Arbiter Melchor).
In her Answer to the Complaint in
REM-102299-10732,[15]
receipts,[17]
bringing her total payments to P866,602.35. Moreover,
It appears that
In an undated Order, [22]
Arbiter San Vicente granted
Yet, in a Decision dated
WHEREFORE, premises considered,
judgment is hereby rendered in favor of the respondent and ordering the
complainant to pay to respondent as follows:
a) The amount of FIVE HUNDRED EIGHTY FOUR THOUSAND THREE
HUNDRED FIFTY FIVE PESOS & 10/100 (P584,255.10) with eighteen
percent (18%) per annum to be computed from the complainant’s delay of payment
dated October 15, 1997 until fully paid, and
b) The amount of FIFTY THOUSAND PESOS (P50,000.00)
as damages and attorney’s fees plus the costs of litigation.
SO
ORDERED. [25]
HLURB
Regional Director Octavio DG. Canta (Director Canta) approved the foregoing
Decision.[26]
IJSRI
filed a Petition for Review[27]
with the HLURB Board of Commissioners (HLURB Board) but Arbiter Melchor, in an
Order[28]
dated
Upon
a Petition for Certiorari and Mandamus[29]
filed by IJSRI, the CA rendered the
WHEREFORE, finding grave abuse of
discretion on the part of public respondents Arbiter Melchor and Regional
Director Obligacion of the HLURB, the assailed Decision dated February 26, 2001
and Order dated February 26, 2002 are hereby VACATED and SET ASIDE.
Accordingly, public respondents are hereby DIRECTED to dispose the cases REM
102999-10732 entitled “IA-JAN SARMIENTO REALTY, INCORPORATED, Complainant
versus JIN-JIN DELOS SANTOS, Respondent” separately and independently, in
keeping with the Order dated
Without
filing a motion for reconsideration from the CA Decision, petitioner
1. The Court of Appeals erred when it made
a legal conclusion given the undisputed facts, that there was grave abuse of
discretion when Arbiter Melchor rendered a consolidated decision on the two
cases of Jin-Jin Delos Santos vs. Sps. Reynato D. Sarmiento/Leni C. Sarmiento
and IA-JAN Sarmiento Realty vs. Jin-Jin Delos Santos, even when the cases
involved the same parties, same matters (contract to buy and sell, cancellation
of contract, townhouse/lot and official receipts) and intimately related
issues.
2. The Court of Appeals erred when, in
ruling to remand the consolidated cases for a separate and independent
resolution, it made the legal conclusion, in clear disregard of the principle
of “piercing the veil of corporate fiction”. That the Spouses Sarmiento and
their Sarmiento Realty Inc. have separate and distinct personalities, even when
the undisputed fact is that the two respondents never considered themselves as
indpendent and separate entitities in their dealings with
petitioner-“purchaser”.
3. The
Court of Appeals erred when it made a legal conclusion given the admitted
facts, that there was grave abuse of discretion when Arbiter Melchor dismissed
the Petition for Review of respondent IA-JAN Sarmiento Realty, Inc. even when
there was failure to attach the required appeal bond and which failure is a
ground for such dismissal.[30]
Before
we even begin to consider the foregoing issues, the Court takes cognizance of a pivotal question
of lack of jurisdiction over the subject matter, a deficiency patent on the
face of the records. We resolve this
issue motu proprio, even if it was not raised by the parties nor
threshed out in their pleadings,[31]
for to let it pass would result in the conferment of jurisdiction to the HLURB by
the mere oversight of the parties, the
agency concerned and the CA.[32]
The
scope and limitation of the jurisdiction of the HLURB is well-defined. Its precursor, the National Housing Authority
(NHA), was vested under Presidential
Decree (P.D.) No. 957[33]
with exclusive jurisdiction to
regulate the real estate trade and
business,[34]
specifically the registration of subdivision or
condominium projects[35]
and dealers, brokers and salesmen of subdivision lots or condominium units;[36]
issuance[37]
and suspension[38]
of license to sell; and revocation of registration certificate[39]
and license to sell.[40] Its jurisdiction was later expanded under Presidential
Decree (P.D.) No. 1344[41] of
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 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, broker or salesman. (Emphasis ours.)
By
virtue of Executive Order No. 648,[42]
the Human Settlements Regulatory Commission (HSRC) was created to regulate
zoning and land use and development[43]
and to assume the regulatory and adjudicatory functions of NHA.[44] HSRC was later renamed HLURB under Executive
Order No. 90.[45]
At present, therefore, it is clear
that the jurisdiction of the HLURB to hear and decide cases is determined by
the nature of the cause of action, the subject matter or property involved and the
parties.
The cases over which HLURB has
jurisdiction are those arising from either unsound real estate business
practices, or claims for refund or other claims filed by subdivision lot or
condominium unit buyers against the project owner, developer, dealer, broker or
salesman, or demands for specific performance of contractual and statutory
obligations filed by buyers of subdivision lots or
condominium units against the owner,
developer,
broker or
salesman.[46]
In
addition, these cases must involve a subdivision project, subdivision lot, condominium project or condominium
unit. A subdivision project or
subdivision lot is defined under Sec. 2 of P.D. No. 957, thus:
Section 2 x x x
d) Subdivision project –
“Subdivision project” shall mean a tract or a parcel of land registered under
Act No. 496 which is partitioned primarily for residential purposes into
individual lots with or without improvements thereon, and offered to the public
for sale, in cash or in installment terms. It shall include all residential,
commercial, industrial and recreational areas as well as open spaces and other
community and public areas in the project.
e) Subdivision lot. –
“Subdivision lot” shall mean any of the lots, whether residential, commercial,
industrial, or recreational, in a subdivision project.
In quite a
number of cases, we declared the HLURB without jurisdiction where the complaint
filed did not allege that the property involved is a subdivision or condominium
project or a subdivision lot or condominium unit.[47] In fact, in Javellana v. Presiding Judge,[48] we were not satisfied with a mere reference
in the contract to sell to the property as a “regular subdivision project.” We observed:
A reading of the complaint does not show
that the subject lot was a subdivision lot which would fall under the
jurisdiction of the HLURB. The complaint
clearly described the subject lot as Lot No. 44, Plan 15 with an area of 139.4
sq. meters situated in the District of Sampaloc covered by Transfer Certificate
of Title No. 131305 of the Registry of Deeds of Manila. We note that such description was used when
referring to the subject lot. What
appears from the complaint was the fact that the subject lot was sold to
petitioners in an ordinary sale of a lot on installment basis; that petitioners
allegedly defaulted in the payment of their monthly installments for which
reason respondent seeks to recover possession thereof. Thus, the trial court has jurisdiction over
the case.
Going back
to the jurisdictional requirements, it is also important that, with reference
to cases arising from a claim for refund or specific performance, said cases
must be filed by the subdivision lot or condominium unit buyer or owner against
the subdivision or condominium project owner, developer, broker or salesman. Cases filed by
buyers or owners of property which
is not alleged to be a subdivision or condominium property do not fall within
the jurisdiction of the HLURB for the complainants in said cases are treated as
ordinary real estate buyers or owners, not subdivision or condomium buyers or
owners.[49]
What about
cases filed by subdivision or condominium project owners or developers
against their buyers? The rules on this matter differ.
The
general rule is stated in Pilar
Development Corporation v. Villar[50]
and Suntay v. Gocolay[51] where we held
that the HLURB has no jurisdiction over cases filed by subdivision or
condominium owners or developers against subdivision lot or condominium unit
buyers or owners. The rationale behind
this can be found in the wordings of Sec. 1, P.D. No. 1344, which expressly qualifies
that the cases cognizable by the HLURB are those instituted by subdivision or
condomium buyers or owners against the project developer or owner. This rationale is also expressed in the preambles of P.D. No. 957 and P.D. No. 1344
which state that the policy of the law
is to curb unscrupulous practices in real estate trade and business.[52]
The only instance that HLURB may take cognizance of a case
filed by the developer is when said case is instituted as a compulsory counterclaim
to a pending case filed against it by the buyer or owner of a subdivision lot
or condominium unit. We allowed this in Francel Realty Corporation v. Sycip in order to forestall splitting of causes of
action.
To
summarize, not every case involving buyers and sellers of real estate may be
filed with the HLURB. Its jurisdiction
is limited to those cases filed by the buyer or owner of a subdivision or
condominium and based on any of the causes of action enumerated under Section 1
of P.D. No. 1344, and which jurisdictional facts must be clearly alleged in the
complaint.
Set against the foregoing
requirements, it is plain that the HLURB has no jurisdiction over REM-102299-10723 and REM-102299-10732.
Mere reference to the contract to
sell, which forms part of the Complaints in REM-102299-10723 and
REM-102299-10732, reveals that the property subject matter of the case is not a
subdivision lot in the contemplation of P.D. No. 957. While the contract describes the residential
lot as found in IA-JAN Homes, there is nothing that would indicate that said
area has been partitioned or developed as a subdivision or that it was
registered with the HLURB as a subdivision project. It is absolutely silent on whether the vendors
Spouses Sarmiento are subdivision owners or that IJSRI is a subdivision
developer or that the vendee
It may be that REM-102299-10723 arose from
As to its Complaint in REM-102299-10732, IJSRI does not claim to be registered
and licensed with the HLURB to engage in the development and sale of
subdivision lots. It merely attached to
its Complaint a copy of its Articles of Incorporation with the Securities and
Exchange Commission which states that its purpose is to acquire, own, use, improve,
develop, subdivide, sell, mortgage, exchange, lease and hold for investment or
otherwise real estate of all kinds.
There is no hint that it is a subdivision developer or owner. Moreover, except for a bare description of the
residential lot being located at IA-JAN Homes, there is no allegation that said
property is a subdivision lot or “part of a tract of land
partitioned primarily for residential purposes into individual lots and offered
to the public for sale x x x [and which] includes recreational areas and open
spaces.”[55]
Worse, REM-102299-10732 is a case instituted
by IJSRI, purportedly as a subdivision owner. As we said, HLURB is not a collection agency that real
estate businesses can employ to exact payment from their clients. Its mandate is to police real estate trade and
business to protect the buying public. It
cannot entertain cases instituted by developers against their buyers,[56]
unless the case is filed as a compulsory counterclaim as contemplated in Francel Realty Corp. v. Sycip. Assuming IJSRI to be a subdivision owner, its
case (REM-102299-10732), which was filed separately from REM-102299-10723, should
not have been entertained by the HLURB.
In sum, the HLURB erred in taking cognizance of both REM-102299-10723 and REM-102299-10732,
and in rendering the
With
the foregoing disquisition, the issues raised in the present Petition need no
longer be resolved.
WHEREFORE,
the petitition is GRANTED. The August 20, 2002 Decision of the Court of
Appeals is SET ASIDE while the February 26, 2001 Decision and
February 26, 2002 Order of the Housing and Land Use Regulatory Board are also SET
ASIDE. REM-102299-10723 and REM-102299-10732 are DISMISSED
without prejudice to the filing of the cases in the proper court.
No
costs.
SO
ORDERED.
MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice
WE CONCUR:
CONSUELO
YNARES-SANTIAGO
Associate Justice
Chairperson
ROMEO J. CALLEJO, SR. MINITA V. CHICO-NAZARIO
Associate
Justice Associate Justice
ANTONIO EDUARDO B. NACHURA
Associate Justice
ATTESTATION
I attest that the conclusions in the above Decision
had been reached in consultation before the case was assigned to the writer of
the opinion of the Court’s Division.
CONSUELO
YNARES-SANTIAGO
Associate Justice
Chairperson, Third Division
C
E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the
Constitution, and the Division Chairperson’s attestation, it is hereby
certified that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court’s Division.
REYNATO
S. PUNO
Chief
Justice
[1] Penned Associate Justice Remedios A. Salazar-Fernando and concurred in by Associate Justices Romeo J. Callejo, Sr. (now a member of the Court) and Danilo B. Pine; rollo, pp. 40-49.
[2]
Entitled “IA-JAN Sarmiento
Realty, Inc., Petitioner, versus Joselito Melchor, in his capacity as Arbiter
of the Housing and Land Use Regulatory Board (HLURB), Jesse A. Obligacion, in
his capacity as Regional Dirctor, Expanded National Capital Region Field
Office, HLURB, the Board of Commissioners, HLURB, and Jin-Jin Delos Santos,
Respondents”; id. at 40.
[3]
Rollo, p. 91.
[4] It
is noted that the contract to sell is written on stationery bearing the
letter-head IA-JAN Sarmiento Realty, Inc. (IJSRI) but the owners-sellers designated therein are Spouses
Sarmiento.
[5]
[6]
[7]
[8] No copy can be found in the records.
[9] The case has varying titles. In HLURB’s February 26, 2001 Decision (CA rollo, p. 34) and February 26, 2002 Order (id. at 31), the case is entitled “Jin-Jin Delos Santos, Complainant, versus Renato D. Sarmiento & Leni Sarmiento, Respondents” while in HLURB’s undated Consolidation Order (rollo, p. 148) and June 7, 2000 Order (id. at 151), the case is entitled “Jin-Jin Delos Santos, Complainant, versus IA-JAN Sarmiento Realty, Inc., Respondents.”
[10]
[11]
Entitled “AI-JAN Sarmiento
Realty, Inc., Complainant, versus Jin-Jin
[12] Rollo, p. 85.
[13] The payments were itemized, thus:
(Rollo, 94-106)
[14]
[15]
[16] Paragraphs 1 and 2, Answer, id.
[17]
Annex “2” Official Receipt No. 142
Annex
“3” Official Receipt No. 221
Annex
“4” Official Receipt No. 222
Annex
“5” Official Receipt No. 166
Annex
“6” Official Receipt No. 301
Annex
“7” Official Receipt No. 415
Annex
“8” Official Receipt No. 473
(Rollo, pp. 124-126)
[18] Answer, rollo, p. 116.
[19] No copy can be found in the records.
[20] CA rollo, p. 182.
[21]
[22] Rollo, p. 148.
[23]
[24]
First paragraph,
[25] CA rollo, p. 34.
[26]
[27]
[28]
[29] Petition, CA rollo, p. 2.
[30] Petition, rollo, pp. 14-15.
[31] Filoteo, Jr. v. Sandiganbayan, 331 Phil. 531, 568-569 (1996); Government v. American Surety Co., 11 Phil. 203 (1908).
[32]
Katon v. Palanca, Jr.,
G.R. No. 151149,
[33]
“Subdivision and Condominium
Buyer’s Protective Decree” effective
[34] Section 3. National Housing Authority - The National Housing Authority shall have exclusive jurisdiction to regulate the real estate trade and business in accordance with the provisions of this Decree.
[35] Section 4. Registration of Projects – The registered owner of a parcel of land who wishes to convert the same into a subdivision project shall submit his subdivision plan to the Authority which shall act upon and approve the same upon a finding that the plan complies with the Subdivision Standards and Regulations enforceable at the time the plan is submitted. The same procedure shall be followed in the case of a plan for a condominium project except that, in addition, said Authority shall act upon and approve the plan with respect to the building or buildings included in the condominium projects in accordance with the National Building Code (R.A. 6541) x x x.
[36] Section 11. Registration of Dealers, Brokers and Salesmen – No real estate dealer, broker or salesman shall engage in the business of selling subdivision lots or condominium units unless he has registered himself with the Authority in accordance with the provisions of this section xxx.
[37] Section 5. License to Sell – Such owner or dealer to whom has been issued a registration certificate shall not, however, be authorized to sell any subdivision lot or condominium unit in the registered project unless he shall have first obtained a license to sell the project within two weeks from the registration of such project x x x.
[38] Section 8. Suspension of License to Sell – Upon verified complaint by a buyer of a subdivision lot or a condominium unit or by any interested party, the Authority may, in its discretion, immediately suspend the owner’s or dealer’s license to sell pending investigation and hearing of the case as provided in Section 13 hereof x x x.
[39] Section 12. Revocation of Registration as Dealers, Brokers and Salesmen – Registration under the preceding section may be refused or any registration granted thereunder, revoked by the Authority x x x.
[40] Section 9. Revocation of Registration Certificate and License to Sell – The Authority may, motu propio or upon verified complaint filed by a buyer of a subdivision lot or condominium unit, revoke the registration of any subdivision project or condominium project and the license to sell of any subdivision lot or condominium unit in said project x x x.
[41] “Empowering the National Housing Authority to Issue Writ of Execution in the Enforcement of its Decision under Presidential Decree No. 957.”
[42] “Reorganizing the Human Settlements Regulatory Commission” effective February 7, 1981.
[43] As enumerated under Sections 4 and 5, Article IV.
[44] Section 8, Article VII of E.O. No. 468 reads:
Section 8. Transfer of
Functions – The regulatory functions of the National Housing Authority
pursuant to Presidential Decrees No. 957, 1216, 1344 and other related laws are
hereby transferred to the Commission, together with such applicable personnel,
appropriation, records, equipment and property necessary for the enforcement
and implementation of such functions. Among these regulatory functions are: (1)
Regulation of the real estate trade and business; (2) Registration of
subdivision lots and condominium projects; (3) Issuance of license to sell
subdivision lots and condominium units in the registered units; (4) Approval of
performance bond and the suspension of license to sell; (5) Registration of
dealers, brokers and salesmen engaged in the business of selling subdivision
lots or condominium units; (6) Revocation of registration of dealers, brokers
and salesmen; (7) Approval of mortgage on any subdivision lot or condominium
unit made by the owner or developer; (8) Granting of permits for the alteration
of plans and the extension period for completion of subdivision or condominium
projects; (9) Approval of the conversion to other purposes of roads and open
spaces found within the project which have been donated to the city or
municipality concerned; (10) Regulation of the relationship between lessors and
lessees; and (11) Hear and decide cases on unsound real estate business practices; claims
involving refund filed against project owners, developers, dealers, brokers or
salesmen, and cases of specific performance. (Emphasis ours.)
[45] “Identifying the Government Agencies Essential for the National Shelter Program And Defining their Mandates, Creating the Housing and Urban Development Coordinating Council, Rationalizing Funding Sources and Lending Mechanisms for Home Mortgages and for Other Purposes” effective December 17, 1986.
[46] Arranza
v. BF Homes, Inc., 389 Phil. 318, 330 (2000); HLC Construction and
Development Corporation v. Emily Homes Subdivision Homeowners
Association, 458 Phil. 392, 399-400 (2003); Home Bankers Savings &
Trust Co. v. Court of Appeals, G.R. No. 128354,
April 26, 2005, 457 SCRA 167, 181; Bank of the Philippine Islands v. ALS
Management & Development Corp., G.R. No. 151821, April 14, 2004, 427 SCRA 564, 574..
[47] Lacson
Hermanas, Inc. v. Heirs of Cenon Ignacio, G.R. No. 165973, June 29, 2005, 462 SCRA 290, 296-297; Javellana v. Hon. Presiding Judge, RTC,
Branch 30, Manila, G.R. No. 139067,
November 23, 2004, 443 SCRA 497, 506-507.
[48] Javellana case, id. note 47, at 506-507.
[49]
Sps. Magat v. Sps. Delizo,
413 Phil. 24, 30 (2001).
[50]
G.R. No. 158840,
[51]
G.R. No. 144892,
[52]
Francel Realty Corp. v. Sycip, G.R. No. 154684,
[53] Supra note 47, at 296.
[54] G.R.
No. 143233,
[55] Sps. Kakilala v. Faraon, id. at 421.
[56] Francel
Realty Corp. v. Sycip, supra note 52, at 433.