G.R. No. 165648 - Eastland Construction and Development Corp. vs. Mortel

Eastland Construction & Development Corporation (Eastland) publicly announced and marketed the “Evergreen Anilao Estate” subdivision in Mabini, Batangas, claiming to sell specific lots despite not yet possessing a Certificate of Registration and License to Sell (CR/LS).
Respondent, Benedicta Mortel, relying on these representations, entered into a contract with Eastland (via its president, Imelda de los Santos) to purchase Lot No. 9, Block 2, allegedly described as 125 square meters at a total price of P168,750.00. An adjustment in the contract accounted for an additional 5 square meters, allegedly correcting what was initially stated as 120 square meters.

Mortel made several payments totaling P183,679.00 (as evidenced by various receipts spanning from May 1996 to July 1998), thereby fully satisfying the contract price.
Despite full payment, Mortel’s repeated demands for the title and the execution of a Deed of Absolute Sale were met with failure, prompting her legal action.

Eastland concealed critical information by failing to disclose that TCT No. T-82217 (covering the estate) had been previously mortgaged to Bangko Silangan Development Bank, later transferred to Orient Commercial Banking Corporation (Orient Bank) as security for a P2,000,000.00 loan.
The mortgage was duly registered and annotated on the title, and subsequent subdivision of TCT No. T-82217 resulted in individual lots (including the one bought by Mortel) inheriting the mortgage status.
The CR/LS for the project was only issued on September 15, 1998, by which time regulatory limitations existed regarding the maximum selling price for each lot.

On March 5, 2001, Mortel filed a complaint for Specific Performance, Delivery of Title, and Damages before the Regional Office of the Housing and Land Use Regulatory Board (HLURB).
The Housing and Land Use Arbiter, in a decision dated November 21, 2002, declared the Real Estate Mortgage null and void, ordered Eastland (and related respondents) to execute and deliver the Deed of Absolute Sale, transfer the title free from liens, and turnover possession of the lot; additionally, damages and fines were imposed for violations under P.D. 957 and B.P. 220.
Appeals followed: PDIC and Orient Bank appealed the Arbiter’s decision to the HLURB Board of Commissioners, which was later affirmed even after the involvement of the Office of the President.

Eastland subsequently petitioned for review in the Court of Appeals, contesting the earlier decisions on substantive grounds and arguing that strict adherence to technicalities should not preclude a full meritorious review.
The petition was marred by procedural defects, notably the failure to attach material portions of the record, supporting documents, and particularly the Certificate of Non-Forum Shopping.
Despite attempts to later remedy the omission by filing a motion for reconsideration, the Court of Appeals dismissed the petition due to non-compliance with mandatory procedural requirements.

Whether the strict application of procedural requirements—specifically, the mandatory inclusion of the Certificate of Non-Forum Shopping and other supporting documents—warrants the dismissal of a petition for review despite the underlying merits of the case.
Whether Eastland’s failure to deliver the title and execute the Deed of Absolute Sale, despite receiving full payment, constitutes a breach of its obligations under the Contract to Sell and amounts to fraudulent concealment of material facts, particularly regarding the mortgage encumbrance.
Whether the substantive irregularities in Eastland’s pre-selling and real estate practices, including the concealment of the mortgage and the premature sale of lots before the issuance of the CR/LS, justify the imposition of damages, fines, and other punitive measures.
Whether the finality and executory nature of the Housing and Land Use Arbiter’s decision should bar any subsequent modification or appeal, even if technical deficiencies are present in the petitioner’s filing.