G.R. No. 209359 - Metroheights Subdivision Homeowners Association, Inc. vs. CMS Construction and Development Corp.

Petitioner Metroheights Subdivision Homeowners Association, Inc. (Metroheights) filed on June 29, 1992 a complaint against CMS Construction and Development Corporation (CMS Construction), its directors Tomasito T. Cruz, Tita F. Cruz, Simonette F. Cruz, Angel T. Cruz, Ernesto T. Cruz (the Cruzes), and the Metropolitan Waterworks and Sewerage System (MWSS) for damages with prayer for injunction.
Metroheights alleged it contracted with MWSS on November 16, 1990 for a new water service connection on Visayas Avenue, funded by members’ contributions of ₱190,000, which provided sufficient 24-hour supply until April 1992.

On August 16, 1991 MWSS contracted CMS Construction for mainlaying and rehabilitation of water mains at nearby Sanville Subdivision, including creek crossing and interconnection with existing pipes.
Without Metroheights’s knowledge or consent, CMS Construction, with MWSS’s acquiescence, cut off and transferred Metroheights’s separate line, leaving residents waterless for three days; PVC pipes valued at ~₱30,000 were stolen; temporary reconnection was effected only by a rubber hose.

RTC Branch 77 rendered judgment on March 30, 1999 in favor of Metroheights, awarding actual (₱190,000), nominal (₱100,000), exemplary (₱100,000) damages and attorneys’ fees (₱50,000); found respondents liable for bad faith cut-off.
After MWSS’s appeal and CMS’s motion for new trial, the RTC on May 18, 2006 affirmed its judgment; respondents’ motion for reconsideration was denied.

On October 10, 2012, the CA reversed and set aside the RTC decisions, dismissed the complaint for lack of merit, finding prior notice was given and no abuse of right.
The CA denied Metroheights’s motion for reconsideration on September 30, 2013.

Metroheights filed before the Supreme Court under Rule 45, raising errors on notice, Article 19 liability, sufficiency of abuse of right finding, and the CA’s dismissal of the complaint.
The Supreme Court granted the petition, reversed the CA, and modified the RTC judgment.

Whether the Court of Appeals erred in finding that Metroheights received prior notice of the rehabilitation project.
Whether respondents may invoke Article 19 of the Civil Code (abuse of rights) to avoid liability.
Whether the CA correctly held that the abuse of right was not sufficiently established.
Whether the CA erred in dismissing Metroheights’s complaint and absolving respondents of civil liability.