765 Phil. 672
LEONARDO-DE CASTRO, J.:
Deed of Absolute Sale | Date of Execution | No. of Lots | Total Area (square meters) | Consideration |
First Deed[3] | In 1992 | 76 | 22,816 | P52,134,560.00 |
Second Deed[4] | In 1993 | 13 | 5,964 | P14,990,514.00 |
Third Deed[5] (Third Sale) | April 1993 | 41 | 15,565 | P39,122,627.00 |
Total | 130 | 44,345 | P106,247,701.00 |
TCT No. | Area |
1. (S-41285) 123526-A | 538 sq. m. |
2. (S-41261) 123522-A | 329 sq. m. |
3. (S-41279) 123520-A | 384 sq. m. |
4. (S-41277) 123518-A | 380 sq. m. |
5. (S-41275) 123516-A | 364 sq. m. |
6. (S-41271) 123512-A | 364 sq. m. |
7. (S-41273) 123514-A | 364 sq. m. |
8. (S-41269) 123510-A | 364 sq. m. |
9. (S-41267)123508-A | 364 sq. m. |
10. (S-41265) 123506-A | 429 sq. m. |
11. (S-41263) 123505-A | 329 sq. m. |
12. (S-41261) 19477-A | 329 sq. m. |
13.(S-41258)19476-A | 280 sq. m. |
14. (S-41257) 23504-A | 308 sq. m. |
15.(S-41256)23503-A | 280 sq. m. |
16. (S-41255) 23502-A | 308 sq. m. |
17. (S-41254)23501-A | 280 sq. m. |
8. (S-41253) 123500-A | 308 sq. m. |
19. (S-41557)28372-A | 502 sq. m. |
20. (S-41279) 123520-A | 665 sq. m. |
What clearly is the issue to be resolved is whether or not [BF Homes] is obligated to deliver the title of the remaining twenty (20) lots to [SMPI] notwithstanding that the latter had fully paid the same.
Were this is a simple case of non-delivery of title of the lot or unit to the buyer upon full payment, sans the attendant problems, the answer would readily be in the affirmative. But this is not so in the instant case. This is a case of non-delivery of titles of a sale of 20 lots between two developers, and the lots sold are from an existing subdivision, which was under rehabilitation and made by a receiver which authority had been continuously questioned by the controlling stockholders of a corporation under rehabilitation.
In the light thereof, it becomes imperative to discuss the antecedent facts that would help in arriving at a judicious resolution of the instant complaint.
Sometime in September 1984, respondent [BF Homes] filed with the SEC a petition for rehabilitation and for declaration of suspension of payments. In February 1988, the SEC appointed Florencio Orendain as [BF Homes'] rehabilitation receiver. In May 1989, the SEC revoked the appointment of Mr. Orendain and appointed FBO Networks Management, Inc. (FBO) as receiver of the [BF Homes].
It was during the time 1992-1993 that [SMPI] bought from [BF Homes] the 130 parcels of land located in the northern portion of BF Homes, Paranaque City.
In June 1994, Mr. Orendain, on behalf of FBO, submitted to the SEC the Closing Report on [BF Homes] I of the receivership program covering the period from March 1988 to January 1994. [BF Homes] protested and questioned the said report by filing the corresponding pleadings with the SEC praying that the receivership of FBO represented by Mr. Orendain be suspended due to violations of trust and breach of fiduciary obligation and sought the nullification of the transaction entered into by Mr. Orendain. In November 1994, FBO was relieved of its duties and responsibilities as rehabilitation receiver and a Committee of Receivers was appointed in lieu thereof, to undertake and continue the rehabilitation program of [BF Homes].
In July 1996, the SEC issued an Omnibus Order in regard to rehabilitation case. Subsequently, however, [BF Homes] filed a petition for review for which the SEC rendered a decision in May 1997. In the said decision, the SEC held that the admission of the Receiver's Closing Report is merely for the purpose of receiving and noting them for inclusion in the records of the case and not an admittance (sic) and acceptance of the merits and veracity of the contents thereof.
In September 2000, the SEC issued another Order terminating the rehabilitation proceedings without, however, deciding on the merits and veracity of the contents of the Receiver's Closing Report. Hence, [BF Homes] filed in October 2000 a Motion for Clarification and/or Partial Reconsideration of the said Order which remains pending with the SEC until the present.
Apparently, it is in the context of the foregoing issues that [BF Homes] refused to deliver the remaining twenty (20) titles of the lots sold to [SMPI] as the former claimed, among others, that Mr. Orendain did not have the authority to sell the 130 parcels of land in the first place.
As the peculiar background of this case would tell, it is inevitable that the resolution of the issues raised in the instant complaint would be largely influenced by the outcome of the cases pending in other tribunals which are directly and ineluctably related to the issues brought before this Board.
This Board is cognizant of the fact that respondent had questioned the action of its rehabilitation receiver before the SEC, raising several issues against him, including but not limited, to his authority to sell the subject lots to the complainant the resolution of which is still pending the said body.
Thus, while this Board may have jurisdiction over the instant complaint, the issue on whether or not Mr. Orendain has overstepped his authority which is pending resolution by the SEC, is to our mind a condition sine qua non, the final resolution of which by said body is a logical antecedent to the issue involved in the instant complaint and which only the SEC has exclusive jurisdiction to decide.
Under the circumstances, we are inclined to suspend the proceedings before the Board until the SEC shall have resolved with finality on the issue of the authority of Mr. Orendain/FBO Networks Management to enter into such transactions on behalf of [BF Homes].
WHEREFORE, PREMISES CONSIDERED, this Office hereby suspends the proceedings of the instant complaint until the final resolution of the pending incidents before the Securities and Exchange Commission.[14]
We find no evidence to support the argument that the SEC had upheld with finality on the sales transaction entered into by Orendain with [SMPI]. On the contrary the order of the SEC stated that the closing report of the receiver is being accepted for inclusion of the records and not an admittance (sic) or acceptance of the merits and veracity of the contents thereof. The issue of whether Orendain had authority to sell the lots is still unresolved.
While this board may have the competence to rule on the validity of the sales transaction entered into by Orendain ostensibly in behalf of BF Homes, we decline to rule on the said issue in deference to the SEC or its successor-in-interest, which has first taken cognizance of the issue, applying the doctrine of primary jurisdiction. Thus, in Vidad vs. RTC of Negros Oriental, it was held:While no prejudicial question strictly arises where one is a civil case and the other is an administrative proceeding, in the interest of good order, it behooves the court to suspend its action on the cases before it pending the final outcome of the administrative proceedings. The doctrine of primary jurisdiction does not warrant a court to arrogate unto itself the authority to resolve a controversy the jurisdiction over which is initially lodged with an administrative body [of special competence].
Wherefore, the petition for review is denied and the decision of the office below is affirmed.[24]
The basic complaint in this case is one for specific performance under Section 25 of Presidential Decree (PD) 957 - "The Subdivision and Condominium Buyers' Protective", infra.
As early as August 1987, the Supreme Court already recognized the authority of the HLURB, as successor agency of the National Housing Authority (NHA), to regulate, pursuant to PD 957 in relation to PD 1344, the real estate trade, with exclusive jurisdiction to hear and decide cases "involving specific performance of contractual and statutory obligations filed by buyers of subdivision lots . . . against the owner, developer, dealer, broker or salesman" (Antipolo Realty Corp. vs. National Housing Authority (153 SCRA). Then came the reiterative rulings in Solid Homes vs. Pavawal (177 SCRA 72 [1989]), United Housing Corp. vs. Dayrit (181 SCRA 295 [1990]), and Realty Exchange Venture Corp. vs. Sendino, 233 SCRA 665 [1994]. And as stressed in Realty Exchange, citing C.T. Torres Enterprises, Inc. vs. Hibionada (191 SCRA 268 [1990], the HLURB, in the exercise of its adjudicatory powers and functions, "must interpret and apply contracts, determine the rights of the parties under these contracts and award damages whenever appropriate."
Given its clear statutory mandate, the HLURB's decision to await for some other forum to decide - if ever one is forthcoming - the issue on the authority of Orendain to dispose of subject lots before it peremptorily resolves the basic complaint is unwarranted, the issues thereon having been joined and the respective position papers and the evidence of the parties having been submitted. To us, it behooved the HLURB to adjudicate, with usual dispatch, the right and obligations of the parties in line with its appreciation of the obtaining facts and applicable law. To borrow from Mabuhay Textile Mills Corp. vs. Ongpin (141 SCRA 437), it does not have to rely on the findings of others to discharge this adjudicatory functions.[26]
There can be no quibbling about the following postulates: 1) The existence of a perfected deed of absolute sale covering the said lots; 2) SMPI appears to be an innocent purchaser for value; 3) Full payment and receipt by [BF Homes] of the stipulated purchase price; 4) Admission by the SEC of FBO's audited Closing Report; 5). Termination of the rehabilitation proceedings, and 6) The obligation of the owner or developer under Sec. 25 of PD 957 to "deliver the title of the lot or units to the buyer upon [full] payment of the lot or unit."
Given the foregoing perspective, the question thus formulated should be answered in the affirmative. [BF Homes'] challenge against the validity of the conveying deed on the ground of inadequacy of the purchase price cannot be given cogency. As a matter of law, lesion or inadequacy of cause shall not invalidate a contract, save in cases specified by law or unless there has been fraud, mistake or undue influence (Art. 1355, Civil Code). Thus, [BF Homes'] allegation about the inadequacy of price for the twenty (20) lots, even if true, cannot invalidate the sale in question, absent a showing that such sale is a case exempted by law from the operation of said article or that fraud, mistake or undue influence attended the sale (Auyong Hian vs. CTA, 59 SCRA 110).
[BF Homes'] posture regarding the invalidity of the same sales transaction owing to Orendain's alleged lack of authority to execute the corresponding deed may be accorded serious consideration were it not for its acceptance and retention of the purchase price for the covered lots. As aptly argued in this appeal, citing jurisprudence, estoppel attached to [BF Homes] when it accepted the benefits arising from the performance of SMPI of its undertaking under the contract of sale. By the doctrine of estoppel, a party is barred from repudiating or canceling an otherwise defective or rescissible contract by his receipt of payments due thereunder (Republic v. Acoje Mining Co., Inc., 7 SCRA 361; Angeles v. Calasanz, 135 SCRA 332); the bar of estoppel also precludes one who, by his conduct, had induced another to act in a particular manner, from adopting an inconsistent position that thereby causes prejudice to another (Cruz vs. CA, 293 SCRA 239).
Significantly, Orendain signed the three deeds of sale adverted to covering 130 lots in 1992 and 1993, or during FBO's watch as receiver. Yet, [BF Homes] opted to fully implement the transactions covered by two of these deeds and partially implement the third by delivering the titles to 110 lots. In net effect, [BF Homes] did recognize the authority of Orendain to execute those contracts. But if Orendain was indeed bereft of authority during the time material, as [BF Homes] would have this Office believe, how explain (sic) its inaction to recover damages against one it veritably depicts as an impostor?
x x x x
Much has been made about the sale of the 130 lots not having been approved by the SEC. It bears to stress in this regard that the Closing Report which, doubtless includes the said sale, had been confirmed and admitted by the SEC Hearing Panel. It may be that the Commission en banc did not specifically confirm and approve the sale. But neither did it interpose objection thereto, let alone disapprove the same. Be that as it may, the presumptive validity and enforceability of such sale must be posited.[27]
IN VIEW OF ALL THE FOREGOING, judgment is hereby entered ordering BF Homes, Inc., to deliver to San Miguel Properties, Inc., the corresponding titles to the lots subject of the instant case, free from all liens and encumbrances, except to the subdivision restrictions referred to in the conveying deed of sale, and to pay the latter the sum of P100,000.00 as and. by way of attorneys' fees. All other claims and counterclaims are hereby DISMISSED. The decision of the HLURB dated 28 March 2003 is accordingly REVERSED and SET ASIDE.[28]
Presidential Decree No. 957 was issued on 12 July 1976. It was promulgated to cover questions that relate to subdivisions and condominiums. Its object is to provide for an appropriate government agency, the HLURB, to which all parties aggrieved in the enforcement of contractual rights with respect to said category of real estate may take course.
In the case of JESUS LIM ARRANZA vs. B.F. HOMES, INC., the Supreme Court said:Section 3 ofP.D. No. 957 empowered the National Housing Authority (NHA) with the "exclusive jurisdiction to regulate the real estate trade and business." On 2 April 1978, P.D. No. 1344 was issued to expand the jurisdiction of the NHA to include the following:Certainly, in the instant case, [SMPI] is a buyer within the contemplation of P.D. 957. Clearly, the acquisition of the one hundred thirty (130) lots was for a valuable consideration.
SECTION 1. In the exercise of its functions 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 asainst the owner, developer, dealer, broker or salesman. (Emphasis supplied.)
Thereafter, the regulatory and quasi-judicial functions of the NHA were transferred to the Human Settlements Regulatory Commission (HSRC) by virtue of Executive Order No. 648 dated 7 February 1981. Section 8 thereof specifies the functions of the NHA that were transferred to the HSRC including the authority to 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." Executive Order No. 90 dated 17 December 1986 renamed the HSRC as the Housing and Land Use Resulatory Board (HLURB). (Underscoring supplied.)
The jurisdiction of the SEC, on the other hand, is defined by P.D. No. 902-A, as amended, as follows:Sec. 5. In addition to the regulatory and adjudicative functions of the Securities and Exchange Commission over corporations, partnerships and other forms of associations registered with it as expressly granted under existing laws and decrees, it shall have original and exclusive jurisdiction to hear and decide cases involving.In the ARRANZA case, the Supreme Court said that:
(a) Devices or schemes employed by or any acts, of the board of directors, business associates, its officers or partnership, amounting to fraud and misrepresentation which may be detrimental to the interest of the public and/or of the stockholder, partners, members of associations or organizations registered with the Commission;
(b) Controversies arising out of intra-corporate or partnership relations, between and among stockholders, members, or associates; between any or all of them and the corporation, partnership or association of which they are stockholders, members or associates, respectively; and between such corporation, partnership or association and the state insofar as it concerns their individual franchise or right to exist as such entity; and
(c) Controversies in the election or appointments of directors, trustees, officers or managers of such corporations, partnerships or associations.For the SEC to acquire jurisdiction over any controversy under these provisions, two elements must be considered: (1) the status or relationship of the parties; and (2) the nature of the Question that is the subject of their controversy.In the instant case, [SMPI] is not a stockholder, member or associate of [BF Homes]. It is a lot buyer in the subdivision developed by [BF Homes.]
The first element requires that the controversy must arise "out of intra-corporate or partnership relations between and among stockholders, members or associates; between any or all of them and the corporation, partnership or association of which they are stockholders, members or associates, respectively; and between such corporation, partnership or association and the State in so far as it concerns their individual franchises.
The second element requires that the dispute among the parties be intrinsically connected with the regulation or the internal affairs of the corporation, partnership or association.
In the case at hand, [SMPI's] complaint before the HLURB is for specific performance to enforce its rights as purchaser of subdivision lots as regards the delivery of twenty (20) TCTs. Certainly, the issue in this case is not related to the "regulation" of [BF Homes] or to [BF Homes'] "internal affairs."
As a matter of fact, Section 25 of PD 957 provides:Section 25. Issuance of Title. The owner or developer shall deliver the title of the lot or unit to the buyer upon full payment of the lot or unit. No fee, except those required for the registration of the deed of sale in the Registry of Deeds, shall be collected for the issuance of such title. In the event a mortgage over the lot or unit is outstanding at the time of the issuance of the title to the buyer, the owner or developer shall redeem the mortgage or the corresponding portion thereof within six months from such issuance in order that the title over any fully paid lot or unit may be secured and delivered to the buyer in accordance herewith, (underscoring supplied.)In the above-mentioned case of Arranza, the Supreme Court also said:P.D. No. 902-A, as amended, defines the jurisdiction of the SEC; while P.D. No. 957, as amended, delineates that of the HLURB. These two quasi-judicial agencies exercise functions that are distinct from each other. The SEC has authority over the operation of all kinds of corporations, partnerships or associations with the end in view of protecting the interests of the investing public and creditors. On the other hand, the HLURB has jurisdiction over matters relating to observance of laws governing corporations engaged in the specific business of development of subdivisions and condominiums. The HLURB and the SEC being bestowed with distinct powers and functions, the exercise of those functions by one shall not abate the performance by the other of its own functions. As respondent puts it, "there is no contradiction between P.D. No. 902-A and P.D. No. 957."Hence, the powers of the HLURB can not be in derogation of the SEC's authority. P.D. Nos. 902-A and 957 are laws in pari materia. This is because P.D. No. 902-A relates to all corporations, while P.D. No. 957 pertains to corporations engaged in the particular business of developing subdivisions and condominiums.
Next, this brings us to the collateral issue of whether or not HLURB properly suspended the proceeding until SEC shall have resolved with finality the issue of authority of Mr. Orendain.
Given the foregoing perspective, the collateral issue thus formulated should be answered in the negative. Furthermore, in several cases decided by the Supreme Court, the High Court has consistently ruled 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.
Hence, the HLURB should take jurisdiction over respondent's complaint because it pertains to matters within the HLURB's competence and expertise. The proceedings before the HLURB should not be suspended.[32]
WHEREFORE, the questioned Decision of the Office of the President [is] AFFIRMED with modification. The case is REMANDED to the Housing and Land Use Regulatory Board for continuation of proceedings with dispatch.[33]SMPI filed a Motion for Partial Reconsideration (Re: Decision dated January 31, 2005)[34] insofar as the Court of Appeals remanded the case to the HLURB for further proceedings. The appellate court denied said Motion in a Resolution[35] dated August 9, 2005.
I.
THE COURT OF APPEALS' DECISION DATED 31 JANUARY 2005 REMANDING THE CASE TO THE HLURB IS CONSTITUTIONALLY FLAWED AND A PATENT NULLITY CONSIDERING THAT:
- IT MISERABLY FAILED TO DISCUSS CLEARLY AND DISTINCTLY THE LEGAL BASIS AND/OR JUSTIFICATION FOR REMANDING THE CASE TO THE HLURB AS MANDATED BY SECTION 14, ARTICLE VIII, 1987 CONSTITUTION.
- WORSE, THE COURT OF APPEALS FAILED TO IDENTIFY THE FACTUAL MATTERS THAT IT CLAIMS NEED STILL BE TRIED OR DETERMINED BY THE HLURB THAT WOULD HAVE JUSTIFIED THE REMAND OF THE CASE.
- IN ANY EVENT, [BF HOMES] AND THE COURT OF APPEALS' CLAIMED DOCTRINE OF PRIMARY JURISDICTION IS FOREVER BARRED AS IT COULD NOT BE INVOKED FOR THE FIRST TIME ON APPEAL.
- EVEN ASSUMING ARGUENDO THAT THE DOCTRINE OF PRIMARY JURISDICTION IS STILL INVOCABLE, IT IS NONETHELESS INAPPLICABLE SINCE THE PARTIES HAD DULY AMPLIFIED THEIR RESPECTIVE CAUSES OF ACTION AND DEFENSES VIA THEIR SUBMISSION OF PLEADINGS AND POSITION PAPERS BEFORE THE HLURB, AND UPON WHICH THE OFFICE OF THE PRESIDENT DECIDED ON THE MERITS.
II.
EVEN THEN, THE COURT OF APPEALS COMMITTED GRAVE, SERIOUS AND REVERSIBLE ERROR WHEN IT REMANDED THE CASE TO THE HLURB FOR FURTHER "PRESENTATION OF EVIDENCE" DESPITE THE DECISION ON THE MERITS OF THE OFFICE OF THE PRESIDENT IN THAT:
- THE ISSUE HERE BEING A SIMPLE QUESTION OF LAW ON WHETHER OR NOT SMPI WAS ENTITLED TO THE DELIVERY OF THE BALANCE OF 130 FULLY PAID LOTS/TITLES OR EQUIVALENT TO TWENTY (20) TITLES, THE COURT OF APPEALS SHOULD HAVE AFFIRMED THE DECISION ON THE MERITS OF THE OFFICE OF THE PRESIDENT.
- IN FACT, THE RELEVANT FACTS OF THE CASE, E.G. FULL PAYMENT OF THE PURCHASE PRICE OF THE SUBJECT LOTS IN FAVOR OF [BF HOMES] AND NON-DELIVERY TO SMPI OF THE TITLES OVER THE SUBJECT LOTS BY [BF HOMES], WERE UNDISPUTED AND MORE SO ADMITTED BY THE PARTIES IN THEIR RESPECTIVE HLURB POSITION PAPERS AND OTHER PLEADINGS FOR WHICH NO TRIABLE EVIDENTIARY MATTER IS LEFT TO BE RESOLVED BY THE HLURB.
- INDEED, THE OFFICE OF THE PRESIDENT, PER ITS DECISION DATED 27 JANUARY 2004, CORRECTLY RESOLVED THIS SIMPLE ISSUE, AND FORTUNATELY IN FAVOR OF SMPI, BASED ON THE PLEADINGS AND POSITION PAPERS FILED BY THE PARTIES IN ACCORDANCE WITH SECTION 5, RULE VI, HLURB RULES. THE COURT OF APPEALS OUGHT TO HAVE SIMILARLY ENFORCED THIS HLURB RULE.
- FURTHER PROCEEDINGS BEFORE THE HLURB IS DILATORY, UNNECESSARY, SUPERFLUOUS AND CIRCUITOUS. HIERARCHICALLY (sic), THE HLURB IS PRECLUDED AND BARRED FROM REOPENING, MUCH LESS REVERSING THE DECISION OF THE OFFICE OF THE PRESIDENT.
- THE COURT OF APPEALS' STANCE IS TANTAMOUNT TO A RE-OPENING OF THE OFFICE OF THE PRESIDENT'S DECISION, HENCE WOULD WREAK HAVOC TO THE DOCTRINE OF SUBSTANTIAL RES JUDICATA.
- IF AT ALL, THE HLURB NEED ONLY BE DIRECTED TO RESOLVE SMPI'S PENDING MOTION FOR EXECUTION, AND NOT CONDUCT FURTHER PROCEEDINGS FOR RECEPTION OF THE PARTIES' EVIDENCE THAT ARE UNSPECIFIED.
III.
THE COURT OF APPEALS COMMITTED GRAVE, SERIOUS AND REVERSIBLE ERROR WHEN IT FAILED AND/OR REFUSED TO AFFIRM THE OFFICE OF THE PRESIDENT'S DECISION DATED 27 JANUARY 2004 IN THAT:
- THE SUBJECT SALE TRANSACTIONS, DULY APPROVED AND CONFIRMED BY THE SEC PER ITS ORDERS DATED 07 NOVEMBER 1994 AND 31 JULY-1996, ARE PRESUMED VALID AND REGULAR SINCE THESE WERE OFFICIAL ACTS OF SEC-APPOINTED RECEIVER MR. FLORENCIO B. ORENDAIN.
- IN FACT, SEC RECEIVER ORENDAIN'S ACTS CANNOT BE IMPUGNED BY [BF HOMES] SINCE UNDER SECTION 9, RULE 9, INTERIM RULES OF PROCEDURE GOVERNING INTRA- CORPORATE CONTROVERSIES AND SECTION 17, RULE 4, INTERIM RULES OF PROCEDURE ON CORPORATE REHABILITATION, WHICH OPERATES RETROACTIVELY BEING A PROCEDURAL RULE, RECEIVERS ENJOY IMMUNITY FROM SUITS ARISING FROM THE EXERCISE OF THEIR FUNCTIONS AND DUTIES.
- NONETHELESS, [BF HOMES] IS ESTOPPED FROM REFUSING TO DELIVER THE REMAINING 20 TCTs SINCE IT HAD PREVIOUSLY DELIVERED TO SMPI 110 TCTs OUT OF 130 TCTs FOR WHICH [BF HOMES] HAD DULY .RECEIVED FULL PAYMENT THEREFOR IN THE TOTAL AMOUNT PHP104,600,402.47.[36] CONSEQUENTLY, [BF HOMES] IS OBLIGED TO DELIVER THE TITLES TO SMPI PURSUANT TO SECTION 25, P.D. 957.
- THE MATTER OF THE PURCHASE PRICE IS IRRELEVANT CONSIDERING THE BIG VOLUME INVOLVED. IN FACT, THE AVERAGE PURCHASE PRICE OF THE LOTS IN THE AMOUNT OF PHP2,500.00 PER SQ. M. IS VALID AND REASONABLE SINCE THE SALE INVOLVED A TOTAL OF 130 LOTS AMOUNTING TO PHP 104,600,402.47.
- EVEN ASSUMING ARGUENDO THAT THERE MAY BE SUBSTANTIAL DISPARITY BETWEEN THE AVERAGE PURCHASE PRICE OF PHP2.500/SQ.M. AND THE MARKET VALUE AT PHP3,500/SQ.M. AS [BF HOMES] CLAIMS, MERE INADEQUACY OF THE PURCHASE PRICE, STANDING ALONE AND WITHOUT PROOF OF ACTUAL FRAUD, CANNOT INVALIDATE THE PARTIES' SALES CONTRACT PER ARTICLE 1355, NEW CIVIL CODE.
- IF AT ALL, [BF HOMES'] REMEDY IS TO FILE THE APPROPRIATE ACTION FOR RECONVEYANCE WITH THE REGULAR COURT, ABSENT WHICH, IT IS LEGALLY BOUND TO DELIVER TO SMPI THE SUBJECT TITLES.
- ACCORDINGLY, SINCE SMPI WAS CONSTRAINED TO LITIGATE DUE TO [BF HOMES'] UNJUSTIFIED REFUSAL TO DELIVER THE SUBJECT TITLES, SMPI IS ENTITLED TO THE PAYMENT OF ATTORNEY'S FEES.[37]
Section 1. In the exercise of its functions 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:
- Unsound real estate business practices;
- 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
- 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." (Emphases ours.)
Under the Executive Order creating it, the HLURB has exclusive jurisdiction to "hear and decide cases of unsound real estate business practices; claims involving refund filed against project owners, developers, dealers, brokers, or salesmen; and cases of specific performance." Accordingly, in United Housing Corporation v. Dayrit, we ruled that it is the HLURB, not the trial court, which has jurisdiction over complaints for specific performance filed against subdivision developers to compel the latter to execute deeds of absolute sale and to deliver the certificates of title to buyers. (Emphases supplied.)
[T]he jurisdiction of the HLURB over cases enumerated in Section 1 of PD No. 1344 is exclusive. Thus, we have ruled that the board has sole jurisdiction in a complaint of specific performance for the delivery of a certificate of title to a buyer of a subdivision lot; for claims of refund regardless of whether the sale is perfected or not; and for determining whether there is a perfected contract of sale. (Emphases supplied.)
The provisions of P.D No. 957 were intended to encompass all questions regarding subdivisions and condominiums. The intention was to provide for an appropriate government agency, the HLURB, to which all parties - buyers and sellers of subdivision and condominium units - may seek remedial recourse. The law recognized, too, that subdivision and condominium development involves public interest and welfare and should be brought to a body, like the HLURB, that has technical expertise. In the exercise of its powers, the HLURB, on the other hand, is empowered to interpret and apply contracts, and determine the rights of private parties under these contracts. This ancillary power, generally judicial, is now no longer with the regular courts to the extent that the pertinent HLURB laws provide.[45]
[T]he doctrine of exhaustion of administrative remedies and the corollary doctrine of primary jurisdiction, which are based on sound public policy and practical considerations, are not inflexible rules. There are many accepted exceptions, such as: (a) where there is estoppel on the part of the party invoking the doctrine; (b) where the challenged administrative act is patently illegal, amounting to lack of jurisdiction; (c) where there is unreasonable delay or official inaction that will irretrievably prejudice the complainant; (d) where the amount involved is relatively small so as to make the rule impractical and oppressive; (e) where the question involved is purely legal and will ultimately have to be decided by the courts of justice; (f) where judicial intervention is urgent; (g) when its application may cause great and irreparable damage; (h) where the controverted acts violate due process; (i) when the issue of non-exhaustion of administrative remedies has been rendered moot; (j) when there is no other plain, speedy and adequate remedy; (k) when strong public interest is involved; and, (1) in quo warranto proceedings, x x x. (Emphases supplied.)
[T]he Supreme Court may, on certain exceptional instances, resolve the merit:? of a case on the basis of the records and other evidence before it, most especially when the resolution of these issues would best serve the ends of justice and promote the speedy disposition of cases.
Thus, considering the peculiar circumstances attendant in the instant case, this Court sees the cogency to exercise its plenary power:"It is a rule of procedure for the Supreme Court to strive to settle the entire controversy in a single proceeding leaving no root or branch to bear the seeds of future litigation. No useful purpose will be served if a case or the determination of an issue in a case is remanded to the trial court only to have its decision raised again to the Court of Appeals and from there to the Supreme Court (citing Board of Commissioners vs. Judge Joselito de la Rosa and Judge Capulong, G.R. Nos. 95122-23).On many occasions, the Court, in the public interest and for the expeditious administration of justice, has resolved actions on the merits instead of remanding them to the trial court for further proceedings, such as where the ends of justice would not be subserved by the remand of the case.
"We have laid down the rule that the remand of the case or of an issue to the lower court for further reception of evidence is not necessary where the Court is in position to resolve the dispute based on the records before it and particularly where the ends of justice would not be subserved by the remand thereof (Escudero vs. Dulay, 158 SCRA 69). Moreover, the Supreme Court is clothed with ample authority to review matters, even those not raised on appeal if it finds that their consideration is necessary in arriving at a just disposition of the case."
3. [BF Homes] likewise covenants to deliver to [SMPI] the properties free and clear of tenants, if any, and shall submit any and all titles, documents and/or papers which may be required to effect the transfer of the properties to [SMPI][.][53]
Upon full payment of the agreed price, petitioner is mandated by law to deliver the title of the lot or unit to the buyer. Both the "Contract to Sell" of petitioner and private respondents, and Sec. 25 of P.D. 957 state -Sec. III (Contract to Sell). - Title and Ownership of Unit. Upon full payment by the vendees of the full amount of the purchase price stipulated under Sec. Ill hereof, the assessments and expenses under Sec. IV and otherwise upon compliance by the VENDEES of all obligations therein, the VENDOR will convey to the VENDEE all rights and interests of the former and to the Unit, subject hereof together with the interest in the common area and in the Condominium Corporation appurtenant to such unit x x x."Petitioner also attempts to justify its failure to deliver the certificate of title of private respondent Teng by claiming that it used the title as part collateral for the additional loan NHA had extended for the construction of the fifth floor.
Sec. 25, P.D. 957 - Issuance of Title. - The owner or developer shall deliver the title of the lot or unit to the buyer upon full payment of the lot or unit x x x. In the event a mortgage over the lot or unit is outstanding at the time of the issuance of the title to the buyer, the owner or developer shall redeem the mortgage or the corresponding portion thereof within six months from such issuance in order that the title over any paid lot or unit may be secured and delivered to the buyer in accordance herewith."
The Court observes the frequent allusion of petitioner to its predicament brought about by the abandonment of the project by the first contractor. But such is irrelevant in light of Sec. 25 of P.D. 957 as well as of the Contract to Sell of the parties. While we empathize with petitioner in its financial dilemma we cannot make innocent parties suffer the consequences of the former's lack of business acumen. Upon full payment of a unit, petitioner loses all its rights and interests to the unit in favor of the buyer, x x x. (Emphases supplied.)
Art. 1403. The following contracts are unenforceable, unless they are ratified:
x x x x
(2) Those that do not comply with the Statute of Frauds as set forth in this number. In the following cases an agreement hereafter made shall be unenforceable by action, unless the same, or some note or memorandum, thereof, be in writing, and subscribed by the party charged, or by his agent; evidence, therefore, of the agreement cannot be received without the writing, or a secondary evidence of its contents:x x x xArt. 1405. Contracts infringing the Statute of Frauds, referred to in No. 2 of Article 1403, are ratified by the failure to object to the presentation of oral evidence to prove the same, or by the acceptance of benefit under them.
(e) An agreement of the leasing for a longer period than one year, or for the sale of real property or of an interest therein;
x x x x
The sale of real property should be in writing and subscribed by the party charged for it to be enforceable. The "Pagpapatunay" is in writing and subscribed by Bonifacio Aparato, the vendor; hence, it is enforceable under the Statute of Frauds. Not having been subscribed and sworn to before a notary public, however, the "Pagpapatunay" is not a public document, and therefore does not comply with Article 1358, Paragraph 1 of the Civil Code.
The requirement of a public document in Article 1358 is not for the validity of the instrument but for its efficacy. Although a conveyance of land is not made in a public document, it does not affect the validity of such conveyance. Article 1358 does not require the accomplishment of the acts or contracts in a public instrument in order to validate the act or contract but only to insure its efficacy, so that after the existence of said contract has been admitted, the party bound may be compelled to execute the proper document, x x x.
x x x x
The private conveyance of the house and lot is therefore valid between Bonifacio Aparato and respondent spouses, x x x For greater efficacy of the contract, convenience of the parties and to bind third persons, respondent spouses have the right to compel the vendor or his heirs; to execute the necessary document to properly convey the property.
The Statute of Frauds embodied in Article 1403, paragraph (2), of the Civil Code requires certain contracts enumerated therein to be evidenced by some note or memorandum in order to be enforceable. The term "Statute of Frauds" is descriptive of statutes which require certain classes of contracts to be in writing. The Statute does not deprive the parties of the right to contract with respect to the matters therein involved, but merely regulates the formalities of the contract necessary to render it enforceable. Evidence of the agreement cannot be received without the writing or a secondary evidence of its contents.
The Statute, however, simply provides the method by which the contracts enumerated therein may be proved but does not declare them invalid because they are not reduced to writing. By law, contracts are obligatory in whatever form they may have been entered into, provided all the essential requisites for their validity are present. However, when the law requires that a contract be in some form in order that it may be valid or enforceable, or that a contract be proved in a certain way, that requirement is absolute and indispensable. Consequently, the effect of non-compliance with the requirement of the Statute is simply that no action can be enforced unless the requirement is complied with. Clearly, the form required is for evidentiary purposes only. Hence, if the parties permit a contract to be proved, without any objection, it is then just as binding as if the Statute has been complied with.
The purpose of the Statute is to prevent fraud and perjury in the enforcement of obligations depending for their evidence on the unassisted memory of witnesses, by requiring certain enumerated contracts and transactions to be evidenced by a writing signed by the party to be charged.
However, for a note or memorandum to satisfy the Statute, it must be complete in itself and cannot rest partly in writing and partly in parol. The note or memorandum must contain the names of the parties, the terms and conditions of the contract, and a description of the property sufficient to render it capable of identification. Such note or memorandum must contain the essential elements of the contract expressed with certainty that may be ascertained from the note or memorandum itself, or some other writing to which it refers or within which it is connected, without resorting to parol evidence.
x x x x
The Statute of Frauds is applicable only to contracts which are executory and not to those which have been consummated either totally or partially. If a contract has been totally or partially performed, the exclusion of parol evidence would promote fraud or bad faith, for it would enable the defendant to keep the benefits already derived by him from the transaction in litigation, and at the same time, evade the obligations, responsibilities or liabilities assumed or contracted by him thereby. This rule, however, is predicated on the fact of ratification of the contract within the meaning of Article 1405 of the Civil Code either (1) by failure to object to the presentation of oral evidence to prove the same, or (2) by the acceptance of benefits under them. x x x. (Emphases supplied.)
ARTICLE 1403. The following contracts are unenforceable, unless they are ratified:
(1) Those entered into in the name of another person by one who has been given no authority or legal representation, or who has acted beyond his powers[.]
Furthermore, it is clear that BISTRANCO received material benefits from the contracts of agency of Sanchez, based upon the monthly statements of income of BISTRANCO, upon which the commissions of Sanchez were based, x x x.
x x x x
[I]n our considered opinion, the doctrine of estoppel precludes BISTRANCO from repudiating an obligation voluntarily assumed by it, after having accepted benefits therefrom.' To countenance such repudiation would be contrary to equity and would put a premium on fraud or misrepresentation, which this Court will not sanction.