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1.

BACANI VS NACOCO clause prescribed in section 16, Rule 130 of our Rules of
G.R. No. L-9657 100 Phil 471 November 29, 1956 Court.

Facts: Plaintiffs Bacani and Matto are both court


stenographers assigned in Branch VI of the Court of First
Instance of Manila. 2. CENTRAL BANK V. CA

During the pendency of a civil case in the said court, G.R. No. L-45710 October 3, 1985
Francisco Sycip vs. National Coconut Corporation, Assistant
Corporate Counsel Federico Alikpala, counsel for Defendant,
requested said stenographers for copies of the transcript of
the stenographic notes taken by them during the hearing.
Plaintiffs complied with the request by delivering to Counsel
Alikpala the needed transcript containing 714 pages and Facts:
thereafter submitted to him their bills for the payment of their Issue:
fees. Ruling:

The National Coconut Corporation (NACOCO) paid the


amount of P564 to Leopoldo T. Bacani and P150 to Mateo 3. MANILA INTERNATIONAL AIRPORT V. CA
A. Matoto for said transcript at the rate of P1 per page. But G.R. No. 155650
the Auditor General required the plaintiffs to reimburse said July 20, 2006
amounts by virtue of a Department of Justice circular which
stated that NACOCO, being a government entity, was
exempt from the payment of the fees in question. For Facts: MIAA received Final Notices of Real Estate Tax
reimbursement to take place, it was further ordered that the Delinquency from the City of Parañaque for the taxable
amount of P25 per payday be deducted from the salary of years 1992 to 2001. MIAA’s real estate tax delinquency was
Bacani and P10 from the salary of Matoto. estimated at P624 million. The City of Parañaque, through its
Petitioners filed an action in Court countering that NACOCO City Treasurer, issued notices of levy and warrants of levy
is not a government entity within the purview of section 16, on the Airport Lands and Buildings. The Mayor of the City of
Rule 130 of the Rules of Court. On the other hand, the Parañaque threatened to sell at public auction the Airport
defendants set up a defense that NACOCO is a government Lands and Buildings should MIAA fail to pay the real estate
entity within the purview of section 2 of the Revised tax delinquency.
Administrative Code of 1917 hence, it is exempted from
paying the stenographers’ fees under Rule 130 of the Rules MIAA filed a petition sought to restrain the City of Parañaque
of Court. from imposing real estate tax on, levying against, and
auctioning for public sale the Airport Lands and Buildings.

The City of Parañaque contended that Section 193 of the


Issues: Whether or not National Coconut Corporation
Local Government Code expressly withdrew the tax
(NACOCO), which performs certain functions of government,
exemption privileges of “government-owned and-controlled
make them a part of the Government of the Philippines.
corporations” upon the effectivity of the Local Government
Code. Thus, MIAA cannot claim that the Airport Lands and
Held: NO. The answer is simple they do not acquire that
Buildings are exempt from real estate tax.
status for the simple reason that they do not come
under the classification of municipal or public
MIAA argued that Airport Lands and Buildings are owned by
corporation. Take for instance the National Coconut
the Republic. The government cannot tax itself. The reason
Corporation. While it was organized with the purpose of
for tax exemption of public property is that its taxation would
“adjusting the coconut industry to a position independent of
not inure to any public advantage, since in such a case the
trade preferences in the United States” and of providing
tax debtor is also the tax creditor.
“Facilities for the better curing of copra products and the
proper utilization of coconut by-products”, a function which
Issue: Whether or not the Airport Lands and Buildings of
our government has chosen to exercise to promote the
MIAA are exempt from real estate tax under existing laws.
coconut industry, however, it was given a corporate power
separate and distinct from our government, for it was made
Held: No. There is no dispute that a government-owned or
subject to the provisions of our Corporation Law in so far as
controlled corporation is not exempt from real estate tax.
its corporate existence and the powers that it may exercise
However, MIAA is not a government-owned or controlled
are concerned (sections 2 and 4, Commonwealth Act No.
corporation. Section 2(13) of the Introductory Provisions of
518). It may sue and be sued in the same manner as any
the Administrative Code of 1987 defines a government-
other private corporations, and in this sense, it is an entity
owned or controlled corporation as follows:
different from our government. As this Court has aptly said,
“The mere fact that the Government happens to be a
SEC. 2. General Terms Defined. – x x x x
majority stockholder does not make it a public corporation”
(National Coal Co. vs. Collector of Internal Revenue, 46
(13) Government-owned or controlled corporation refers to
Phil., 586-587). “By becoming a stockholder in the National
any agency organized as a stock or non-stock corporation,
Coal Company, the Government divested itself of its
vested with functions relating to public needs whether
sovereign character so far as respects the transactions of
governmental or proprietary in nature, and owned by the
the corporation law. Unlike the Government, the corporation
Government directly or through its instrumentalities either
may be sued without its consent, and is subject to taxation.
wholly, or, where applicable as in the case of stock
Yet the National Coal Company remains an agency or
corporations, to the extent of at least fifty-one (51) percent of
instrumentality of government.” (Government of the
its capital stock: x x x. (Emphasis supplied)
Philippine Islands vs. Springer, 50 Phil., 288.)
A government-owned or controlled corporation must be
To recapitulate, we may mention that the term “Government
"organized as a stock or non-stock corporation." MIAA is not
of the Republic of the Philippines” used in section 2 of the
organized as a stock or non-stock corporation. MIAA is not a
Revised Administrative Code refers only to that government
stock corporation because it has no capital stock divided into
entity through which the functions of the government are
shares. MIAA has no stockholders or voting shares.
exercised as an attribute of sovereignty, and in this are
included those arms through which political authority is made
MIAA is a government instrumentality vested with corporate
effective whether they be provincial, municipal or other form
powers to perform efficiently its governmental functions.
of local government. These are what we call municipal
MIAA is like any other government instrumentality, the only
corporations. They do not include government entities which
difference is that MIAA is vested with corporate powers.
are given a corporate personality separate and distinct from
Section 2(10) of the Introductory Provisions of the
the government and which are governed by the Corporation
Administrative Code defines a government "instrumentality"
Law. Their powers, duties and liabilities have to be
as follows:
determined in the light of that law and of their corporate
charters. They do not therefore come within the exemption
SEC. 2. General Terms Defined. –– x x x x
considerations. There must be express language in the law
(10) Instrumentality refers to any agency of the National empowering local governments to tax national government
Government, not integrated within the department instrumentalities. Any doubt whether such power exists is
framework, vested with special functions or jurisdiction by resolved against local governments.
law, endowed with some if not all corporate powers,
administering special funds, and enjoying operational 4. IRON AND STEEL AUTHORITY V.CA
autonomy, usually through a charter. x x x (Emphasis G.R. No. 102976
supplied) October 25, 1995

When the law vests in a government instrumentality Facts: Petitioner ISA was created by PD No. 272 in order,
corporate powers, the instrumentality does not become a generally, to develop and promote the iron and steel
corporation. Unless the government instrumentality is industry.
organized as a stock or non-stock corporation, it remains a
government instrumentality exercising not only governmental PD No. 272 initially created ISA for a term of 5 years
but also corporate powers. Thus, MIAA exercises the counting from August 9, 1973. When ISA’s original term
governmental powers of eminent domain,12 police expired on October 10, 1978, its term was extended for
authority13 and the levying of fees and charges.14 At the another 10 years by EO No. 555 dated August 31, 1979.
same time, MIAA exercises "all the powers of a corporation
under the Corporation Law, insofar as these powers are not The National Steel Corporation (NSC) then a wholly owned
inconsistent with the provisions of this Executive Order."15 subsidiary of the National Development Corporation which is
itself an entity wholly owned by the National Government,
Likewise, when the law makes a government instrumentality embarked on an expansion program embracing, among
operationally autonomous, the instrumentality remains part other things, the construction of an integrated steel mill in
of the National Government machinery although not Iligan City. The construction of such steel mill was
integrated with the department framework. The MIAA considered a priority and major industrial project of the
Charter expressly states that transforming MIAA into a government. Pursuant to the expansion program of the NSC,
"separate and autonomous body"16 will make its operation Proclamation No. 2239 was issued by the President of the
more "financially viable." Philippines on November 16, 1982 withdrawing from sale or
settlement a large tract of public land located in Iligan City,
Many government instrumentalities are vested with and reserving that land for the use and immediate
corporate powers but they do not become stock or non-stock occupancy of NSC.
corporations, which is a necessary condition before an Since certain portions of the aforesaid public land were
agency or instrumentality is deemed a government-owned or occupied by a non-operational chemical fertilizer plant and
controlled corporation. Examples are the Mactan related facilities owned by Maria Cristina Fertilizer
International Airport Authority, the Philippine Ports Authority, Corporation (MCFC), LOI No. 1277, also dated November
the University of the Philippines and Bangko Sentral ng 16, 1982, was issued directing the NSC to “negotiate with
Pilipinas. All these government instrumentalities exercise the owners of MCFC, for and on behalf of the Government,
corporate powers but they are not organized as stock or for the compensation of MCFC’s present occupancy rights
non-stock corporations as required by Section 2(13) of the on the subject land.
Introductory Provisions of the Administrative Code. These
government instrumentalities are sometimes loosely called Negotiations between NSC and MCFC failed.
government corporate entities. However, they are not
government-owned or controlled corporations in the strict Issue: Whether or not the Republic of the Philippines is
sense as understood under the Administrative Code, which entitled to be substituted for ISA in view of the expiration of
is the governing law defining the legal relationship and status ISA's term. As will be made clear below, this is really the
of government entities. only issue which we must resolve at this time.

A government instrumentality like MIAA falls under Section Held: Clearly, ISA was vested with some of the powers or
133(o) of the Local Government Code, which states: attributed normally associated with juridical personality.
There is, however, no provision in PD No. 272 recognizing
SEC. 133. Common Limitations on the Taxing Powers of ISA as possessing general or comprehensive juridical
Local Government Units. – Unless otherwise provided personality separate and distinct from that of the
herein, the exercise of the taxing powers of provinces, cities, government. The ISA in fact appears to the Court to be a
municipalities, and barangays shall not extend to the levy of non-incorporated agency or instrumentality of the RP, or
the following: more precisely of the Government of the Philippines. It is
common knowledge that other agencies or instrumentalities
xxxx of the Government of the Republic are cast in corporate
form, that is to say, are incorporated agencies or
(o) Taxes, fees or charges of any kind on the National instrumentalities, sometimes with and at other times without
Government, its agencies and instrumentalities and local capital stock, and accordingly vested with a juridical
government units.(Emphasis and underscoring supplied) personality distinct from the personality of the Republic.

Section 133(o) recognizes the basic principle that local We consider that the ISA is properly regarded as an agent or
governments cannot tax the national government, which delegate of the RP. The Republic itself is a body corporate
historically merely delegated to local governments the power and juridical person vested with the full panoply of powers
to tax. While the 1987 Constitution now includes taxation as and attributes which are compendiously described as “legal
one of the powers of local governments, local governments personality.”
may only exercise such power "subject to such guidelines
and limitations as the Congress may provide."18 When the statutory term of non-incorporated agency expires,
the powers, duties and functions as well as the assets and
When local governments invoke the power to tax on national liabilities of that agency revert back to, and are reassumed
government instrumentalities, such power is construed by the RP, in the absence of special provisions of law
strictly against local governments. The rule is that a tax is specifying some other disposition thereof, e.g., devolution or
never presumed and there must be clear language in the law transmission of such powers, duties and functions, etc. to
imposing the tax. Any doubt whether a person, article or some other identified successor agency or instrumentality of
activity is taxable is resolved against taxation. This rule the RP.
applies with greater force when local governments seek to
tax national government instrumentalities. When the expiring agency is an incorporated one, the
consequence of such expiry must be looked for, in the first
instance, in the charters and, by way of supplementation, the
There is also no reason for local governments to tax national provisions of the Corporation Code. Since in the instant
government instrumentalities for rendering essential public case, ISA is a non-incorporated agency or instrumentality of
services to inhabitants of local governments. The only the Republic, its powers, duties and functions, assets and
exception is when the legislature clearly intended to tax liabilities are properly regarded as folded back into the
government instrumentalities for the delivery of essential Government and hence assumed once again by the
public services for sound and compelling policy Republic, no special statutory provision having been shown
to have mandated succession thereto by some other entity ministrant. The former involves the exercise of sovereignty
or agency of the Republic. and considered as compulsory; the latter connotes merely
the exercise of proprietary functions and thus considered as
In the instant case, ISA substituted the expropriation optional.
proceedings in its capacity as an agent or delegate or
representative of the Republic of the Philippines pursuant to The National Irrigation Administration was not created for
its authority under PD 272. purposes of local government. While it may be true that the
The principal or the real party in interest is thus the Republic NIA was essentially a service agency of the government
of the Philippines and not the NSC, even though the latter aimed at promoting public interest and public welfare, such
may be an ultimate user of the properties involved. fact does not make the NIA essentially and purely a
“government-function” corporation. NIA was created for the
From the foregoing premises, it follows that the Republic is purpose of “constructing, improving, rehabilitating, and
entitled to be substituted in the expropriation proceedings in administering all national irrigation systems in the
lieu of ISA, the statutory term of ISA having expired. Put a Philippines, including all communal and pump irrigation
little differently, the expiration of ISA’s statutory term did not projects.” Certainly, the state and the community as a whole
by itself require or justify the dismissal of the eminent are largely benefited by the services the agency renders, but
domain proceedings. these functions are only incidental to the principal aim of the
agency, which is the irrigation of lands.
5. FONTANILLA v. MALIAMAN
G.R. No. L-55963
December 1, 1989
NIA is a government agency invested with a corporate
Facts: On December 1, 1989, the Court rendered a decision
personality separate and distinct from the government, thus
declaring National Irrigation Administration (NIA), a
is governed by the Corporation Law. Section 1 of Republic
government agency performing proprietary functions. Like
Act No. 3601 provides:
an ordinary employer, NIA was held liable for the injuries,
resulting in death, of Francisco Fontanilla, son of petitioner
Sec. 1. Name and Domicile — A body corporate is hereby
spouses Jose and Virginia Fontanilla, caused by the fault
created which shall be known as the National Irrigation
and/or negligence of NIA’s driver employee Hugo Garcia;
Administration. . . . which shall be organized immediately
and NIA was ordered to pay the petitioners the amounts of P
after the approval of this Act. It shall have its principal seat of
12,000 for the death of the victim; P3,389 for hospitalization
business in the City of Manila and shall have representatives
and burial expenses; P30,000 as moral damages; P8,000 as
in all provinces, for the proper conduct of its business.
exemplary damages, and attorney’s fees of 20% of the total
(Emphasis for emphasis).
award.
Besides, Section 2, subsection b of P.D. 552 provides that:
The National Irrigation Administration (NIA) maintains,
however, that it does not perform solely and primarily
(b) To charge and collect from the beneficiaries of the water
proprietary functions, but is an agency of the government
from all irrigation systems constructed by or under its
tasked with governmental functions, and is therefore not
administration, such fees or administration charges as may
liable for the tortuous act of its driver Garcia, who was not its
be necessary to cover the cost of operation, maintenance
special agent. For this, they have filed a motion for
and insurance, and to recover the cost of construction within
reconsideration on January 26, 1990.
a reasonable period of time to the extent consistent with
government policy; to recover funds or portions thereof
NIA believes this bases this on:
expended for the construction and/or rehabilitation of
communal irrigation systems which funds shall accrue to a
PD 552 – amended some provisions
special fund for irrigation development under section 2
hereof;
of RA 3601 (the law which created the NIA)
Unpaid irrigation fees or administration charges shall be
The case of Angat River Irrigation
preferred liens first, upon the land benefited, and then on the
crops raised thereon, which liens shall have preference over
System v. Angat River Workers’ Union
all other liens except for taxes on the land, and such
preferred liens shall not be removed until all fees or
Angat Case: Although the majority opinion declares that the
administration charges are paid or the property is levied
Angat System, like the NIA, exercised a governmental
upon and sold by the National Irrigation Administration for
function because the nature of its powers and functions does
the satisfaction thereof. . . .
not show that it was intended to “bring to the Government
any special corporate benefit or pecuniary profit”, a strong
The same section also provides that NIA may sue and be
dissenting opinion held that Angat River system is a
sued in court.
government entity exercising proprietary functions.
It has its own assets and liabilities. It also has corporate
The Angat dissenting opinion:
powers to be exercised by a Board of Directors. Section 2,
subsection (f): . . . and to transact such business, as are
Alegre protested the announced termination of his
directly or indirectly necessary, incidental or conducive to the
employment. He argued that although his contract did
attainment of the above powers and objectives, including the
stipulate that the same would terminate on July 17, 1976,
power to establish and maintain subsidiaries, and in general,
since his services were necessary and desirable in the usual
to exercise all the powers of a corporation under the
business of his employer, and his employment had lasted for
Corporation Law, insofar as they are not inconsistent with
five years, he had acquired the status of regular employee
the provisions of this Act.
and could not be removed except for valid cause.
6. What is Doctrine of Primary Jurisdiction?
The employment contract of 1971 was executed when the
Labor Code of the Philippines had not yet been promulgated,
The doctrine of primary jurisdiction holds that if a case is
which came into effect some 3 years after the perfection of
such that its determination requires the expertise,
the contract.
specialized training and knowledge of an administrative
body, relief must first be obtained in an administrative
Issue: Whether or not NIA is a government agency with a
proceeding before resort to the courts is had even if the
juridical personality separate and distinct from the
matter may well be within their proper jurisdiction. It applies
government, thereby opening it up to the possibility that it
where a claim is originally cognizable in the courts and
may be held liable for the damages caused by its driver, who
comes into play whenever enforcement of the claim requires
was not its special agent.
the resolution of issues which, under a regulatory scheme,
have been placed within the special competence of an
Held: YES
administrative agency. In such a case, the court in which the
claim is sought to be enforced may suspend the judicial
Reasoning the functions of government have been classified
process pending referral of such issues to the administrative
into governmental or constituent and proprietary or
body for its view11 or, if the parties would not be unfairly requestioning the latter to declare the extent of its rights
disadvantaged, dismiss the case without prejudice. (EURO- under its provisional authority (Annex C, CA-G.R. SP No.
MED LABORATORIES, PHIL. V PROVINCE OF 10370).
BATANGAS)
On September 17, 1986, petitioner was able to secure from
7. BOC V. DELA ROSA respondent Commission an Order directing private
G.R. NOS. 95122-23 respondent "to immediately cease and desist from operating
31 May 1991 its units from the New Manila International Airport to any
point in Luzon" (Annexes D and 9, CA-G.R. SP No. 10370).
Two days later, however, this Order was lifted by respondent
Facts: July 1960 - Santiago Gatchalian, an illegitimate child Commission upon motion of private respondent (Annex 5,
to a Chinese father (Pablo Pacheco) and a Filipino mother CA-G.R. SP No. 10049; Annexes 10 and 11, CA-G.R. SP
(Mariana Gatchalian), was recognized as a native born No. 10370).
Filipino citizen following the citizenship of his mother. He
also declared that he has 5 children with his Chinese wife On September 23, 1986, petitioner filed before this Court
Chu Gin Tee. One of them was Francisco, CA-G.R. SP No. 10049 praying, among others, that a
William Gatchalian’s father. Restraining Order issue to prevent implementation of the
September 8, and 19, 1986 Orders of respondent Court and
to direct said Court to grant the injunction prayed for therein.

27 June 1961
On October 1, 1986, petitioner filed its Opposition to private

respondent's Petition for Declaratory Relief pending before
12-year old William, together with his father Francisco,
respondent Commission (Annex F, CA-G.R. SP No. 10370).
arrived in Manila from Hong Kong. They had with them
certificates of Registration and Identity issued by the
On October 9, 1986, respondent Commission acted on
Philippine consulate in Hong Kong and they sought
private respondent's Petition for Declaratory Relief ruling that
admission as Filipino citizens.
the provisional authority granted to private respondent was

"to transport passengers from the New Manila International
6 July 1961
Airport and from said place to any point in the Island of

Luzon ...." (Annex G, CA-G.R. SP No. 10370).
Board of Special Inquiry No. 1 (BSI1) admitted William and
his companions as Filipino citizens.
On October 15, 1986, petitioner filed a motion for respondent

Commission to reconsider its Order of October 9, 1986
24 January 1962
(Annex H, CA-G.R. SP No. 10370). This was denied by said

Commission in its Order dated October 17, 1986
Secretary of Justice issued Memorandum No. 9 setting
aside all decisions purporting to have been rendered by the
Issue: W/N the warrant of arrest by the Board of
Board of Commissioners (BOC) on appeal or on review. The
Commissioners and the Commission on Immigration and
Secretary of Justice asked the BOC to review all the cases
Deportation was valid.
where entry was allowed on the grounds of the entrant being
a Filipino citizen. Among those cases was that of William.
Ruling: The doctrine of primary jurisdiction of petitioners

Board of Commissioners over deportation proceedings is,
6 July 1962
therefore, not without exception (Calacday vs. Vivo, 33

SCRA 413 [1970]; Vivo vs. Montesa, 24 SCRA 155 [1967]).
The BOC reversed the initial decision of the BSI1 and
Judicial intervention, however, should be granted only in
ordered the exclusion of William Gatchalian. A warrant of
cases where the "claim of citizenship is so substantial that
exclusion was issued alleging that the BOC decision was
there are reasonable grounds to believe that the claim is
final and executory.
correct. In other words, the remedy should be allowed only

on sound discretion of a competent court in a proper
1973
proceeding (Chua Hiong vs. Deportation Board, supra; Co.

vs. Deportation Board, 78 SCRA 107 [1977]). It appearing
Respondent Gatchalian, as well as the others covered by
from the records that respondent's claim of citizenship is
the July 6, 1962 filed a motion for re-hearing with the BSI.
substantial, as We shall show later, judicial intervention

should be allowed.
15 March 1973

In the case at bar, the competent court which could properly
Acting Commissioner Victor Nituda issued an order
take cognizance of the proceedings instituted by respondent
reaffirming the 6 July 1961 decision to admit Gatchalian as a
Gatchalian would nonetheless be the Regional Trial Court
Filipino citizen. The warrant of arrest was also recalled.
and not the Court of Appeals in view of Sec. 21 (1), BP 129,

which confers upon the former jurisdiction over actions for
7 June 1990
prohibition concurrently with the Court of Appeals and the

Supreme Court and in line with the pronouncements of this
Acting NBI Commissioner wrote to the Secretary of Justice
Court in Chua Hiong and Co cases.
recommending that William be charged with violation of the
Immigration Act of 1940 (Commonwealth Act. No. 613).
Ordinarily, the case would then be remanded to the Regional

Trial Court. But not in the case at bar. Considering the
15 August 1990
voluminous pleadings submitted by the parties and the

evidence presented, we deem it proper to decide the
order to arrest Gatchalian was issued. He later was
controversy right at this instance. And this course of action is
released upon posting a Php 200,000 bond.
not without precedent for "it is a cherished rule of procedure

for this Court to always strive to settle the entire controversy
in a single proceeding leaving no root or branch to bear the
BOC contends that William’s arrest follows as a matter of seeds of future litigation. No useful purpose will be served if
consequence the Warrant of Exclusion issued on 6 July this case is remanded to the trial court only to have its
1962. decision raised again to the Court of Appeals and from there
 to this Court.”
On the other hand, William argues that the Mission Order of
Warrant of Arrest does mention that it is issued pursuant to a
final order of deportation or warrant of exclusion
8. QUALITRANS LIMOUSINE SERVICE, INC., vs. ROYAL
Issue: On September 16, 1986, petitioner filed a Motion for CLASS LIMOUSINE SERVICE, JUDGE PERPETUA
Reconsideration (Annex J, CA-G.R. SP No. 10049) which COLOMA, and COURT OF APPEALS, respondents.
was denied by respondent Court on September 19, 1986. G.R. No. 79887
November 22, 1989
In the meantime, private respondent filed in respondent
Commission a Petition for Declaratory Relief (sic)
Facts: On June 22, 1982, the then Board of Transportation,
now the Land Transportation Commission, rendered a xxx xxx xxx
Decision granting petitioner a certificate of public
convenience to operate a garage (tourist) air-conditioned In the granting or refusal of a certificate of public
service within the City of Manila and from said place to any convenience, all things considered, the question is what is
point in Luzon, and vice-versa (Annex A, CA-G.R. SP No. for the best interests of the public.16
10049).
Like Monserrat, the Court finds it "hard to conceive how it
On June 25, 1982, said Decision was amended by would be for the best interests of the public" 17, to have one
converting petitioner's certificate of public convenience for line only, "and how the public would be injured by the
garage service into one for limousine tourist service for the granting of the certificate in question, for it must be
transportation of all outgoing passengers of the Manila conceded that two companies in the field would stimulate the
International Airport (Annex B, CA-G.R. SP No. 10049). business..." 18

On October 14, 1985, a Deed of Absolute Sale (Annex I of It is simply bellyaching to say that Royal Class had
both Records) was executed by private respondent with transcended the bounds of the certificate of public
Transcare, Inc., a duly licensed limousine service operator convenience granted to it. What Qualitrans is plainly carping
and likewise, a holder of a certificate of public convenience about is the threat the Royal Class' certificate of public
(Annex 2 of both Records). By virtue of said sale, the convenience poses on its foothold in the "limo" service
franchise granted to Transcare, Inc. for the use of 40 units of business. This is monopolism, plainly and simply, and we
tourist cars was sold to private respondent. can not tolerate it. The constitutional mandate is for "a more
equitable distribution of opportunities, income, and wealth"
On December 27, 1985, upon application filed for the 19 and for the State to regulate or prohibit monopolies." 20
approval of aforementioned sale, an Order was issued by
the Land Transportation Commission granting a provisional As we have held furthermore, a provisional authority is given
permit in favor of private respondent. on showing of public need. 21 Thus, it may be issued ex-
parte.
On June 17, 1986, petitioner filed a motion for
reconsideration before the Land Transportation Commission II (G.R. No. 79887)
to correct the route specified in the prefatory portion of its
December 27, 1986 Order (Annex 4 of both Records). 1. For the same reasons, the above appeal must
Petitioner argues that the application filed by private also fail. The Regional Trial Court (RTC) had acted correctly
respondent was for the route from the "New Manila in dismissing Qualitrans' damage suit.
International Airport to hotels and from said hotels to any
point in Luzon accessible to vehicular traffic and vice-versa", Ramos v. Court of First Instance of Tayabas, 22 in which we
and not from the "New Manila International Airport ... to any sustained the jurisdiction of the CFI (now, RTC) at the
point in the Island of Luzon ... " (ibidem). Petitioner claims expense of Public Service Commission (now, the Land
that respondent has been soliciting passengers from the Transportation Commission), has no application. In that
New Manila International Airport to transport them to any case, the aggrieved party had denounced his adversary's
point in Luzon to the prejudice of petitioner's business. action before the PSC. The latter, however, had failed to act.
We stamped our imprimatur on the CFI's jurisdiction
On September 1, 1986, petitioner filed Civil Case No. 4275- because of temporal constraints. ("Damages pile up day by
P before the Pasay City Regional Trial Court for damages day as infringement continues. The Public Service
with prayer for issuance of a writ of mandatory injunction Commission has been afforded an opportunity to give relief
against private respondent. and has not done so." 23

On same date, Hon. Fermin A. Martin. Jr., Vice-Executive In addition, there is a need to square the functioning of
Judge of the Pasay City Regional Trial Court, issued a administrative bodies vis-a-vis contemporary realities. As we
Restraining Order directing private respondent to desist from have observed, the increasing pattern of law and legal
ferrying passengers from the New Manila International development has been to entrust "special cases" to "special
Airport to their residences. The petition for preliminary bodies" rather than the courts. As we have also held, the
injunction was set for hearing on September 5, 1986. shift of emphasis is attributed to the need to slacken the
encumbered dockets of the judiciary and so also, to leave
On September 3, 1986, private respondent, defendant in "special cases" to specialists and persons trained therefor.
Civil Case No. 4275, filed an Urgent Motion to Dissolve/Lift
Restraining Order issued by Hon. Fermin A. Martin, Jr. 9. MARINA PROPERTIES CORP. v. CA
(Annex F, CA-G.R. SP No. 10049). Thereafter, same G.R. No. 125475
respondent filed an Opposition to petitioner's application for August 14, 1998
a writ of preliminary mandatory.
Facts: The factual antecedents, as summarized by the Court
In the hearing of September 5, 1986, respondent Hon. of Appeals, are as follows:
Perpetua D. Coloma, in whose Branch the civil case was
raffled, gave petitioner up to September 8, 1986 within which Petitioner Marina Properties Corporation (MARINA for short)
to file an opposition, if any, to respondent urgent motion. is a domestic corporation engaged in the business of real
estate development. Among its projects is a condominium
On September 8, 1986, petitioner filed the required complex project, known as the MARINA BAYHOMES
opposition (Annex 1, CA-G.R. SP No. 10049). On that same CONDOMINIUM PROJECT consisting of 10 building
date, respondent Judge ruled on said urgent motion and clusters with 31 housing units to be built on a parcel of land
petitioner's earlier prayer for the issuance of a preliminary at Asiaworld City, Coastal Road in Paranaque, Metro Manila.
mandatory injunction. Pertinent portions of respondent The area is covered by T.C.T. No. (121211) 42201 of the
Judge's Order. Registry of Deeds of the same municipality.

Issue: WON THE DOCTRINE OF EXHAUSTION OF The construction of the project commenced sometime in
ADMINISTRATIVE REMEDIES IS NOT APPLICABLE TO 1988, with respondent H.L. Carlos Construction, Inc. (H.L.
THIS CASE. CARLOS for brevity) as the principal contractor, particularly
of Phase III.
Held: The abovestated doctrine applies with equal force to
the case under consideration. For although Monserrat As an incentive to complete the construction of Phase III,
involved a fleet of taxicabs, the taxicab business is no MARINA allowed H.L. CARLOS to purchase a condominium
different, fundamentally, from a limousine service because unit therein known as Unit B-121. Thus, on October 9, 1988,
both have very broad destinations. the parties entered into a Contract to Purchase and to Sell
covering Unit B-121 for P3,614,000.00. H.L. CARLOS paid
That Royal Class had, itself, admitted that its franchise P1,034,200.00 as downpayment, P50,000.00 as cash
covered the NAIA-hotel route alone, does not weaken the deposit and P67,024.22 equivalent to 13 monthly
Commission's ruling. The yardstick, so Monserrat tells us, is amortizations.
that:
After paying P1,810,330.70, which was more than half of the In the case at bar, the complainant had already paid
contract price, H.L. CARLOS demanded for the delivery of P1,810,330.70 or more than 50% of the contract price of
the unit, but MARINA refused. This prompted H.L. CARLOS P3,614,000.00 and more than the total of two years (24
to file with the Regional Trial Court of Makati, Branch 61 a months) installments computed at the monthly installment of
complaint for damages against MARINA, docketed as Civil P67,024.22, inclusive of the downpayment, which is more
Case No. 89-5870. than 24 installments. Under R.A. 6552, notarial cancellation
of the installment contract becomes effective only upon
Meanwhile, on April 20, 1990, MARINA wrote H.L. CARLOS payment of the cash surrender value to the purchaser, which
that it was exercising its option under their Contract to however respondent did not do.
Purchase and to Sell to take over the completion of the
project due to its (H.L. CARLOS) abandonment of the Respondents cancellation of the subject contract was clearly
construction of the Phase III project. illegal, void and cannot be sanctioned.

In a letter dated March 15, 1991, H.L. CARLOS inquired Neither can this Office find merit in respondents’ contention
from MARINA about the turn-over status of the condominium that this case should be suspended because of the pending
unit. MARINA replied that it was cancelling the Contract to civil case between the parties, said pending case, Civil Case
Purchase and Sell due to H.L. CARLOS abandonment of the No. 89-5870 in the Regional Trial Court, Branch 61, Makati,
construction of the Phase III Project and its filing of baseless Metro Manila, was filed by the same complainant herein
and harassment suits against MARINA and its officers. against the same respondent for collection of unpaid billings
in the amount of about P10,000,000.00.
Forthwith, H.L. CARLOS filed the instant complaint for
specific performance with damages against MARINA with On the other hand, this Office finds that respondents act in
the Housing and Land Use Regulatory Board (HLURB), cancelling the subject installment sales contract without
alleging among others, that it has substantially complied with following the provisions of R.A. 6552 is an unsound real
the terms and conditions of the Contract to Purchase and estate business practice for which respondent is fined the
Sell, having paid more than 50% of the contract price of the sum of P5,000.00.
condominium unit; and that MARINAs act of cancelling the
contract was done with malice and bad faith. H.L. CARLOS As to damages and attorneys fees claimed by complainant
prays that MARINA be ordered to deliver to it the subject and borne out by the records, this Office finds that
unit, accept the monthly amortizations on the remaining respondent should be held liable for unearned rental income
balance, execute the final deed of sale and deliver the title of of P30,000.00 per month, commencing from March 1990
the unit upon full payment of the contract price. Also, H.L. when the condominium unit should have been delivered until
CARLOS prays for the award of actual and exemplary actual delivery thereof, and attorneys fees of P50,000.00,
damages as well as attorneys fees. both amounts to be deducted from the unpaid balance due
on the subject condominium unit.
In its answer, MARINA claimed that its cancellation of the
Contract to Purchase and Sell is justified since H.L. Likewise, for its wanton breach of the subject contract,
CARLOS has failed to pay its monthly installment since respondent is ordered to pay exemplary damages in the
October 1989 or for a period of almost two (2) years; that amount of P50,000.00 as an example for the public good,
H.L. CARLOS abandoned its work on the project as of deductible from the balance due on the subject condominium
December 1989; and that the instant case should have been unit.
suspended in view of the pendency of Civil Case No. 89-
5870 for damages in the Makati RTC involving the same Whereupon, MARINA interposed an appeal to the Board of
issues. Commissioners of HLURB (First Division) which affirmed the
assailed decision.
On February 21, 1992, the HLURB, through Atty. Abraham
N. Vermudez, Arbiter, rendered a decision, the dispositive On further appeal to the Office of the President, the decision
portion of which reads: of the Board of Commissioners (First Division) was affirmed.

WHEREFORE, PREMISES CONSIDERED, judgment is MARINA filed a motion for reconsideration but was denied.
hereby rendered declaring the cancellation of the subject [5]
Contract to Sell as null and void and ordering respondent
Marina Properties Corporation as follows: MARINA filed a petition for review with the Court of Appeals
ascribing the following errors to the Office of the President:
1. To turn over the subject condominium unit to herein
complainant, accept monthly amortization[s] on the (1) In sustaining the award of actual damages for unrealized
remaining balance and to execute the final deed of sale and profits in favor of private respondent H.L. CARLOS which
deliver title/ownership of the subject property to the were unliquidated, speculative and patently unreasonable;
complainant upon full payment of the contract price.
(2) In declaring the motion for reconsideration filed by
2. To pay complainant actual damages of P30,000.00 per MARINA pro-forma and depriving it of the right of appeal;
month commencing from March 1990 until the delivery of the and
subject property and the amount of P50,000.00 as
exemplary damages. (3) In not dismissing the case on the grounds of litis
pendentia, forum-shopping and splitting a single cause of
3. To pay complainant the amount of P50,000.00 as and by action.[6]
way of attorneys fees.
The Court of Appeals sustained MARINA as regards the
4. To pay to this Board the amount of P5,000.00 as [an] award of actual damages, finding that no evidence was
administrative fine. presented to prove the P30,000.00 award as monthly rental
for the condominium unit. However, as to the
IT IS SO ORDERED. pronouncement of the Office of the President that MARINAs
motion for reconsideration was merely pro-forma, the Court
In ruling for H.L. CARLOS, the HLURB Arbiter held: of Appeals noted that MARINA did not raise any new issue
in its motion for reconsideration. In the same vein,
x x x. respondent court ruled that MARINA was not deprived of its
right to appeal.
Respondents position that the case is a complex one is more
imaginary than real. Clearly, the cancellation of the subject The Court of Appeals likewise brushed aside MARINAs
Contract to Purchase and to Sell was in violation of Republic assertion that the complaint should have been dismissed on
Act No. 6552, otherwise known as the Realty Installment the ground of litis pendentia thus:
Buyers Protection Act, which prescribes the procedure for
cancellation of installment contracts for the purchase of The requisites of lis pendens as a ground for dismissal of a
subdivision lots and/or condominium units. complaint are: (1) identity of parties or at least such
representing the same interest in both actions; (2) identity of
rights asserted as prayed for, the reliefs being founded on
the same facts; and (3) identity in both cases is such that the forma as the issues of litis pendentia, forum-shopping and
judgment that may be rendered in the pending case, splitting of a cause of action as well as the issue of
regardless of which party is successful, would amount to res unliquidated, speculative and unreasonable damages raised
judicata to the other case. therein were basically the same issues raised and discussed
extensively in the Appeal Memorandum and which were
There is no dispute that the case at bench and Civil Case already weighed, discussed and considered by this Office in
No. 89-5870 for damages at the Makati RTC involves the its Order dated March 15, 1995.[10] As a consequence, the
same parties although in the civil case, the officers of Office of the President declared its decision final and
MARINA have been impleaded as co-defendants. While the executory.
first requisite obtains in this case, the last two are
conspicuously absent. Under our rules of procedure, a party adversely affected by a
decision of a trial court may move for reconsideration thereof
It will be observed that the two cases involve distinct and on the following grounds: (a) the damages awarded are
separate causes of action or rights asserted. Civil Case No. excessive; (b) the evidence is insufficient to justify the
89-5870 is for the collection of sums of money decision; or (c) the decision is contrary to law.[11] A motion
corresponding to unpaid billings and labor costs incurred by for reconsideration interrupts the running of the period to
H.L. CARLOS in the construction of the project under the appeal, unless the motion is pro forma.[12] This is now
Construction Contract agreed upon by the parties. Upon the expressly set forth in the last paragraph of Section 2, Rule
other hand, the case at bench is for specific performance 37, 1997 Rules of Civil Procedure.
(delivery of the condominium unit) and damages arising from
the unilateral cancellation of the Contract to Purchase and to A motion for reconsideration based on the foregoing grounds
Sell by MARINA. is deemed pro forma if the same does not specify the
findings or conclusions in the judgment which are not
Moreover, the reliefs sought are also different. In the civil supported by the evidence or contrary to law, making
case, H.L. CARLOS prays for the award of P7,065,885.03 express reference to the pertinent evidence or legal
representing unpaid labor costs, change orders and price provisions.[13] It is settled that although a motion for
escalations including the sum of P2,000,000.00 as additional reconsideration may merely reiterate issues already passed
compensatory damages. In the instant case, H.L. CARLOS upon by the court, that by itself does not make it pro forma
seeks not only the awa[r]d of actual and exemplary damages and is immaterial because what is essential is ompliance
but also the delivery of the condominium unit upon MARINAs with the requisites of the Rules.[14] Thus, in Guerra
acceptance of the monthly amortization on the remaining Enterprises, Co. Inc. v. CFI of Lanao del Sur,[15] we ruled:
balance, the execution of a final deed of sale and the
delivery of the title to the said private respondent. Among the ends to which a motion for reconsideration is
addressed, one is precisely to convince the court that its
MARINAs claim that the present complaint should be ruling is erroneous and improper, contrary to the law or the
dismissed on the ground of splitting a cause of action, evidence; and in doing so, the movant has to dwell of
deserves scant consideration. The two complaints did not necessity upon the issues passed upon by the court. If a
arise from a single cause of action but from two separate motion for reconsideration may not discuss these issues, the
causes of action. It bears emphasis that H.L. CARLOS consequence would be that after a decision is rendered, the
cause of action in the civil case stemmed from the breach by losing party would be confined to filing only motions for
MARINA of its contractual obligation under the Construction reopening and new trial. We find in the Rules of Court no
Contract, while in the case at bench, H.L. CARLOS cause of warrant for ruling to that effect, a ruling that would, in effect
action is premised on the unilateral cancellation of the eliminate subsection (c) of Section 1 of Rule 37.
Contract to Purchase and Sell by MARINA.[7]
On this note, it has also been fittingly observed that:
Accordingly, the Court of Appeals affirmed the Order of the
Office of the President but deleted the award of actual Where the circumstances of a case do not show an intent on
damages. As such, the parties sought redress from this the part of the pleader to merely delay the proceedings, and
Court by way of separate petitions. his motion reveals a bona fide effort to present additional
matters or to reiterate his arguments in a different light, the
In G.R. No. 125447, MARINA asserts that the Court of courts should be slow to declare the same outright as pro
Appeals erred: (1) in finding that petitioner should turn over forma. The doctrine relating to pro forma motions has a
the subject condominium unit to H.L. CARLOS and accept direct bearing upon the movants valuable right to appeal. It
monthly amortizations on the remaining balance; and (2) in would be in the interest of justice to accord the appellate
not ordering the dismissal of the case on the grounds of litis court the opportunity to review the decision of the trial court
pendentia, forum-shopping and splitting of a single cause of on the merits than to abort the appeal by declaring the
action. motion pro forma, such that the period to appeal was not
interrupted and had consequently lapsed.[16]
On the other hand, in G.R. No. 125475, H.L. CARLOS
contends that the Court of Appeals gravely erred in: (1) We are thus unable to hold that MARINAs motion for
finding that the award of actual damages equivalent to reconsideration was merely pro forma. Our review of the
P30,000.00 in unearned monthly rentals was not sustained records reveals that said motion adequately pointed out the
by evidence; (2) in not declaring that the petition for review conclusions MARINA regarded as erroneous and contrary to
was filed out of time and fatally defective for lack of law, and even referred to findings not supported by evidence
verification and certification by MARINA Properties, and in as well as jurisprudence to sustain MARINAs claims. As to
not declaring the decision of the Office of the President final the justification proffered by the Office of the President that it
and executory; and 3) in not dismissing MARINAs appeal as had already passed upon the issues raised by MARINA in its
without merit. motion, plainly, the authorities cited above readily refute
such a position.
MARINAs motion to consolidate both cases was granted in a
resolution dated 27 January 1997.[8] It may be pointed out that under Supreme Court Circular No.
1-91 dated 27 February 1991 and Revised Administrative
We first address the lone procedural issue of the timeliness Circular No. 1-95 dated 16 May 1995, which took effect on 1
of the petition for review filed by MARINA with the Court of June 1995, an aggrieved party is allowed one motion for
Appeals and the supposed lack of verification and reconsideration of the assailed decision or final order before
certification. he may file a petition for review with the Court of Appeals. All
told, MARINAs motion for reconsideration was but proper
We find without merit the allegation that MARINAs petition under the adjective rules extant in this jurisdiction.
for review before the Court of Appeals was filed out of time
as MARINAs motion for reconsideration (of the order of the The charge of a lack of verification or certification in
Office of the President) was found to be pro forma and, MARINAs petition before the Court of Appeals is baseless.
therefore, did not stop the running of its period to appeal. Even the most cursory of reviews will disclose that such may
be found on pages 30 and 31 of the Petition.[17]
MARINA filed its Motion for Reconsideration on the last day
of its period to appeal, specifically, on 3 May 1995. However, We agree with the conclusion of the Court of Appeals that
the motion was found by the Office of the President to be pro the award of P30,000.00 as actual damages for unearned
monthly rental income starting from March 1990 until the residential lots. One of the subdivisions that respondent
delivery of the property to H.L. CARLOS was arbitrary. developed was the BF Homes Paranaque Subdivision. With
Article 2199 of the Civil Code provides that one is entitled to the withdrawal of substantial investments in BFHI ,
adequate compensation only for such pecuniary loss respondent filed with the SEC a petition for rehabilitation.
suffered by him as is duly proved.[18] Actual damages, to be Atty Florencio Orendain was appointed as receiver. He was
recoverable, must not only be capable of proof, but must later relieved by the SEC of his duties as a Receiver. The
actually be proved with a reasonable degree of certainty.[19] new Board of Receivers revoked the authority given by
Courts cannot simply rely on speculation, conjecture or Orendain to use the open spaces at Concha Cruz Drive and
guesswork in determining the fact and amount of damages. to collect community assessment funds; deferred the
[20] As the Court of Appeals correctly found here that no purchase of new pumps ; recognized BF Paranaque
proof was submitted by H.L. CARLOS to substantiate the Homeowners Association (BFPHAI) as the representative of
recovery of actual damages in the form of monthly rentals, all homeowners; took over the management of the
the deletion of such award was but appropriate. Clubhouse and deployed its own guards.

The issue of forum shopping raised by MARINA deserves Petitioners filed with the HLURB a class suit “for and in
scant consideration. H.L. CARLOS was not guilty of forum behalf of the more than 7,000 homeowners” against
shopping when it sued MARINA before the HLURB to respondent BFHI et al to enforce the rights of purchasers of
enforce their Contract To Purchase and To Sell. Forum lots in BF Homes Paranaque 3. Respondents asserts that
shopping is the act of a party against whom an adverse the SEC, not the HLURB, has jurisdiction arguing that the
judgment has been rendered in one forum, of seeking SEC, being the appointing authority should be the one to
another (and possibly favorable) opinion in another forum take cognizance of controversies arising from the
other than by appeal or the special civil action of certiorari, or performance of the receiver’s duties.
the institution of two (2) or more actions or proceedings
grounded on the same cause on the supposition that one or Issue: Whether or not the Securities and Exchange
the other court might look with favor upon the party.[21] Commission (SEC) or the Housing and Land Use Regulatory
Contrary to MARINAs assertion, H.L. CARLOS complaint Board (HLURB) that has jurisdiction over a complaint filed by
was hardly a duplication of Civil Case No. 89-5870 which subdivision homeowners against a subdivision developer
was filed to collect the sum of money corresponding to that is under receivership for specific performance regarding
unpaid billings from their Construction Contract. The cause basic homeowners needs such as water, security and open
of action in the civil case was, therefore, totally distinct from spaces.
the cause of action in the complaint before the HLURB. For
this reason, neither could there have been splitting of a Held: The boom in the real estate business all over the
cause of action. country resulted in more litigation between subdivision
owners/developers and lot buyers with the issue of the
Anent the absence of litis pendentia, the Court of Appeals jurisdiction of the NHA or the HLURB over such
meticulous analysis of this issue leaves no room for controversies as against that of regular courts. In the cases
improvement and we adopt it as our own. [16] that reached this Court, the ruling has consistently been
that the NHA or the HLURB has jurisdiction over complaints
We likewise uphold the finding that MARINAs cancellation of arising from contracts between the subdivision developer
the Contract To Buy and To Sell was clearly illegal. Prior to and the lot buyer or those aimed at compelling the
MARINAs unilateral act of rescission, H.L. CARLOS had subdivision developer to comply with its contractual and
already paid P1,810,330.70, or more than 50% of the statutory obligations to make the subdivision a better place
contract price of P3,614,000.00. Moreover, the sum H.L. to live in.
CARLOS had disbursed amounted to more than the total of
24 installments, i.e., two years worth of installments Notably, in Antipolo Realty Corporation v. National Housing
computed at a monthly installment rate of P67,024.22, Authority, one of the issues raised by the homeowners was
inclusive of the downpayment. the failure of Antipolo Realty to develop the subdivision in
accordance with its undertakings under the contract to sell.
As to the governing law, Section 24 of P.D. 957[22] provides: Such undertakings include providing the subdivision with
concrete curbs and gutters, underground drainage system,
SEC.24. Failure to pay installments. -- The rights of the asphalt paved roads, independent water system, electrical
buyer in the event of his failure to pay the installments due installation with concrete posts, landscaping and concrete
for reasons other than failure of the owner or developer to sidewalks, developed park or amphitheater and 24~hour
develop the project shall be governed by Republic Act No. security guard service. The Court held that the complaint
6552. filed by the homeowners was within the jurisdiction of the
NHA.
Then among the requirements of R.A. No. 6552, in order to
effect the cancellation of a contract, a notarial cancellation Similarly, in Alcasid v. Court of Appeals, the Court ruled that
must first be had.[24] Therefore, absent this, MARINAs the HLURB, not the RTC, has jurisdiction over the complaint
cancellation of its contract with H.L. CARLOS was void. of lot buyers for specific performance of alleged contractual
and statutory obligations of the defendants, to wit, the
In conclusion, cases involving specific performance of execution of contracts of sale in favor of the plaintiffs and the
contractual and statutory obligations, filed by buyers of introduction in the disputed property of the necessary
subdivision lots or condominium units against the owner, facilities such as asphalting and street lights.
developer, dealer, broker or salesman fall under the
jurisdiction of the HLURB.[25] It is incumbent upon said In the case at bar, petitioners complaint is for specific
administrative agency, in the exercise of its powers and performance to enforce their rights as purchasers of
functions, to interpret and apply contracts, determine the subdivision lots as regards rights of way, water, open
rights of the parties under these contracts, and award spaces, road and perimeter wall
damages whenever appropriate.[26]
In the case at bar, petitioners complaint is for specific
WHEREFORE, the petitions in these consolidated cases, performance to enforce their rights as purchasers of
G.R. No. 125447 and G.R. No. 125475 are DENIED and the subdivision lots as regards rights of way, water, open
assailed decision of respondent Court of Appeals of 27 June spaces, road and perimeter wall repairs, and security.
1996 is hereby AFFIRMED. Indisputably then, the HLURB has jurisdiction over the
complaint.
Costs against petitioner in each case.
The fact that respondent is under receivership does not
SO ORDERED. divest the HLURB of that jurisdiction. A receiver is a person
appointed by the court, or in this instance, by a quasi~judicial
10. ARRANZA V. BF HOMES administrative agency, in behalf of all the parties for the
G.R. No. 131683. purpose of preserving and conserving the property and
June 19, 2000 preventing its possible destruction or dissipation, if it were
left in the possession of any of the parties.[19] It is the duty
Facts: Respondent BF Homes, Inc (BFHI) , is a domestic of the receiver to administer the assets of the receivership
corporation engaged in developing subdivision and selling estate; and in the management and disposition of the
property committed to his possession, he acts in a fiduciary The argument that the trial court could also assume
capacity and with impartiality towards all interested persons. jurisdiction because of Section 41 of PD No. 957, earlier
[20] The appointment of a receiver does not dissolve a quoted, is also unacceptable. We do not read that provision
corporation, nor does it interfere with the exercise of its as vesting concurrent jurisdiction on the Regional Trial Court
corporate rights.[21] In this case where there appears to be and the Board over the complaint mentioned in PD No. 1344
no restraints imposed upon respondent as it undergoes if only because grants of power are not to be lightly inferred
rehabilitation receivership,[22] respondent continues to exist or merely implied. The only purpose of this section, as we
as a corporation and hence, continues or should continue to see it, is to reserve. to the aggrieved party such other
perform its contractual and statutory responsibilities to remedies as may be provided by existing law, like a
petitioners as homeowners. prosecution for the act complained of under the Revised
Penal Code. 6
Receivership is aimed at the preservation of, and at making
more secure, existing rights; it cannot be used as an On the competence of the Board to award damages, we find
instrument for the destruction of those rights.[23] that this is part of the exclusive power conferred upon it by
PD No. 1344 to hear and decide "claims involving refund and
No violation of the SEC order suspending payments to any other claims filed by subdivision lot or condominium unit
creditors would result as far as petitioners complaint before buyers against the project owner, developer, dealer, broker
the HLURB is concerned. To reiterate, what petitioners seek or salesman." It was therefore erroneous for the respondent
to enforce are respondents obligations as a subdivision to brush aside the well-taken opinion of the Secretary of
developer. Such claims are basically not pecuniary in nature Justice.
although it could incidentally involve monetary
considerations. All that petitioners claims entail is the As a result of the growing complexity of the modern society,
exercise of proper subdivision management on the part of it has become necessary to create more and more
the SEC~appointed Board of Receivers towards the end that administrative bodies to help in the regulation of its ramified
homeowners shall enjoy the ideal community living that activities. Specialized in the particular fields assigned to
respondent portrayed they would have when they bought them, they can deal with the problems thereof with more
real estate from it. expertise and dispatch than can be expected from the
legislature or the courts of justice. This is the reason for the
11. SOLID HOMES INCORPORTAED V. PA increasing vesture of quasi-legislative and quasi-judicial
G.R. No. 84811 powers in what is now not unreasonably called the fourth
August 29, 1989 department of the government.

Facts: On August 31, 1982 Teresita Payawal filed a Statutes conferring powers on their administrative agencies
complaint against Solid Homes Inc., before the Regional must be liberally construed to enable them to discharge their
Trial Court alleging that they contracted to sell her assigned duties in accordance with the legislative purpose. 8
subdivision lot in Marikina on June 9, 1975. Subsequently Following this policy in Antipolo Realty Corporation v.
Solid Homes Inc. executed a deed of sale but failed to National Housing Authority, 9 the Court sustained the
deliver the corresponding certificate title despite of repeated competence of the respondent administrative body, in the
demands by Payawal because defendant had mortgaged the exercise of the exclusive jurisdiction vested in it by PD No.
property in bad faith to a financing company. Thereafter, 957 and PD No. 1344, to determine the rights of the parties
Solid Homes Inc moved to dismiss the complaint on the under a contract to sell a subdivision lot.
ground that the court had no jurisdiction this being rested in
the National Housing Authority under PD no. 597. The It remains to state that, contrary to the contention of the
motion was denied, hence, the petition to reverse said petitioner, the case of Tropical Homes v. National Housing
decision of the Court of Appeals in sustaining the jurisdiction Authority 10 is not in point. We upheld in that case the
of the Regional Trial Court was submitted by Solid Homes constitutionality of the procedure for appeal provided for in
Inc. to the Supreme Court. PD No. 1344, but we did not rule there that the National
Housing Authority and not the Regional Trial Court had
Issue: Whether or not the trial court had jurisdiction over exclusive jurisdiction over the cases enumerated in Section I
cases involving claims, refund and any other claims filed by of the said decree. That is what we are doing now.
subdivision lot or condominium unit buyers against the
project owner, developer, dealer, broker or salesman. It is settled that any decision rendered without jurisdiction is
a total nullity and may be struck down at any time, even on
Held: The applicable law is PD No. 957, as amended by PD appeal before this Court. 11 The only exception is where the
No. 1344, entitled "Empowering the National Housing party raising the issue is barred by estoppel, 12 which does
Authority to Issue Writs of Execution in the Enforcement of not appear in the case before us. On the contrary, the issue
Its Decisions Under Presidential Decree No. 957." Section 1 was raised as early as in the motion to dismiss filed in the
of the latter decree provides as follows: trial court by the petitioner, which continued to plead it in its
answer and, later, on appeal to the respondent court. We
SECTION 1. In the exercise of its function to regulate the have no choice, therefore, notwithstanding the delay this
real estate trade and business and in addition to its powers decision will entail, to nullify the proceedings in the trial court
provided for in Presidential Decree No. 957, the National for lack of jurisdiction.
Housing Authority shall have exclusive jurisdiction to hear
and decide cases of the following nature: WHEREFORE, the challenged decision of the respondent
court is REVERSED and the decision of the Regional Trial
A. Unsound real estate business practices; Court of Quezon City in Civil Case No. Q-36119 is SET
ASIDE, without prejudice to the filing of the appropriate
B. Claims involving refund and any other claims filed complaint before the Housing and Land Use Regulatory
by subdivision lot or condominium unit buyer against the Board.
project owner, developer, dealer, broker or salesman; and
12. CT TORRES v. HIBIONADA
C. Cases involving specific performance of G.R. No. 80916
contractuala statutory obligations filed by buyers of November 9, 1990
subdivision lot or condominium unit against the owner,
developer, dealer, broker or salesman. (Emphasis supplied.) Facts: The petitioner as agent of private respondent
Pleasantville Development Corporation sold a subdivision lot
The language of this section, especially the italicized on installment to private respondent Efren Diongon. The
portions, leaves no room for doubt that "exclusive installment payments having been completed, Diongon
jurisdiction" over the case between the petitioner and the demanded the delivery of the certificate of title to the subject
private respondent is vested not in the Regional Trial Court land. When neither the petitioner nor Pleasantville complied,
but in the National Housing Authority. he filed a complaint against them for specific performance
and damages in the Regional Trial Court of Negros
It is obvious that the general law in this case is BP No. 129 Occidental. This was docketed as Civil Case No. 3514. The
and PD No. 1344 the special law. two defendants each filed an answer with cross-claim and
counterclaim. The plaintiff filed a reply and answered the
counterclaims. Pre-trial was scheduled and heard and trial
briefs were submitted by Pleasantville and Diongon. The companion recognition that the dockets of our regular courts
case was set for initial hearing. It was then that C.T. Torres have remained crowded and clogged. 3
Enterprises filed a motion to dismiss for lack of jurisdiction,
contending that the competent body to hear and decide the As a result of the growing complexity of the modern society,
case was the Housing and Land Use Regulatory Board. The it has become necessary to create more and more
motion was heard and Diongon later filed an opposition. On administrative bodies to help in the regulation of its ramified
September 17, 1987, the trial court 2 denied the motion to activities. Specialized in the particular fields assigned to
dismiss in an order. them, they can deal with the problems thereof with more
expertise and dispatch than can be expected from the
In holding that the complaint for specific performance with legislature or the courts of justice. This is the reason for the
damages was justiciable under the Civil Code and so came increasing vesture of quasi-legislative and quasi-judicial
under the jurisdiction of the regular courts under B.P. 129, powers in what is now not unquestionably called the fourth
the trial court failed to consider the express provisions of department of the government.
P.D. No. 1344 and related decrees. It also erred in
supposing that only the regular courts can interpret and There is no question that a statute may vest exclusive
apply the provisions of the Civil Code, to the exclusion of the original jurisdiction in an administrative agency over certain
quasi-judicial bodies. disputes and controversies falling within the agency's special
expertise. The very definition of an administrative agency
P.D. No. 957, promulgated July 12, 1976 and otherwise includes its being vested with quasi-judicial powers. The
known as "The Subdivision and Condominium Buyers' ever increasing variety of powers and functions given to
Protective Decree," provides that the National Housing administrative agencies recognizes the need for the active
Authority shall have exclusive authority to regulate the real intervention of administrative agencies in matters calling for
estate trade and business. technical knowledge and speed in countless controversies
which cannot possibly be handled by regular courts. 5
P.D. No. 1344, which was promulgated April 2, 1978, and
empowered the National Housing Authority to issue writs of The argument of the private respondents that the petition is
execution in the enforcement of its decisions under P.D. No. premature because no motion for reconsideration of the
957, specified the quasi-judicial jurisdiction of the agency as questioned order of trial court had been filed stresses the
follows: rule but disregards the exception. It is settled that the motion
for reconsideration may be dispensed with if the issue raised
SECTION 1. In the exercise of its functions to is a question of law, 6 as in the case at bar. The issue
regulate the real estate trade and business and in addition to pleaded here is lack of jurisdiction. It could therefore be
its powers provided for in Presidential Decree No. 957, the raised directly and immediately with this Court without the
National Housing Authority shall have exclusive jurisdiction necessity of an antecedent motion for reconsideration.
to hear and decide cases of the following nature:
We hold, in sum, that the complaint for specific performance
A. Unsound real estate business practices; and damages was improperly filed with the respondent court,
jurisdiction over the case being exclusively vested in the
B. Claims involving refund and any other claims filed Housing and Land Use Regulatory Board. We also hold that
by subdivision lot or condominium unit buyer against the the order denying the motion to dismiss was subject to
project owner developer, dealer, broker or salesman; and immediate challenge before this Court as the filing (and
denial) of a motion for reconsideration was not an
C. Cases involving specific performance of indispensable requirement.
contractual and statutory obligations filed by buyers of
subdivision lots or condominium units against the owner,
developer, dealer, broker or salesman. (Emphasis supplied)

Under E.O. No. 648 dated February 7, 1981, the regulatory


functions conferred on the National Housing Authority under
P.D. Nos. 957,1344 and other related laws were transferred
to the Human Settlements Regulatory Commission, which
was renamed Housing and Land Use Regulatory Board by
E.O. No. 90 dated December 17, 1986.

It is clear from Section 1(c) of the above quoted PD No.


1344 that the complaint for specific performance with
damages filed by Diongon with the Regional Trial Court of
Negros Occidental comes under the jurisdiction of the
Housing and Land Use Regulatory Board. Diongon is a
buyer of a subdivision lot seeking specific performance of
the seller's obligation to deliver to him the corresponding
certificate of title.

The argument that only courts of justice can adjudicate


claims resoluble under the provisions of the Civil Code is out
of step with the fast-changing times. There are hundreds of
administrative bodies now performing this function by virtue
of a valid authorization from the legislature. This quasi-
judicial function, as it is called, is exercised by them as an
incident of the principal power entrusted to them of
regulating certain activities falling under their particular
expertise.

Issue:

Held: It is by now commonplace learning that many


administrative agencies exercise and perform adjudicatory
powers and functions, though to a limited extent only.
Limited delegation of judicial or quasi-judicial authority to
administrative agencies (e.g. the Securities and Exchange
Commission and the National Labor Relations Commission)
is well recognized in our jurisdiction, basically because the
need for special competence and experience has been
recognized as essential in the resolution of questions of
complex or specialized character and because of a

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