Case Summary (G.R. No. 228232)
Relevant Dates and Events
In March 1988, Mover Enterprises, Inc. (the developer of Sunnyside Heights) mortgaged a lot to the Philippine Commercial International Bank (PCIB) to secure a loan. PCIB later foreclosed on this mortgage, and the property was titled in its name on May 17, 1993. In mid-1994, SHHA filed a complaint with the Housing and Land Use Regulatory Board (HLURB) to annul the mortgage, asserting that the lot had been allocated as an open space. However, their initial complaint was dismissed on August 28, 1995, for lack of cause of action. Subsequent legal challenges led to the HLURB ruling in favor of SHHA on September 6, 1996, which was affirmed by the Office of the President (OP) on November 22, 2007, and later by the Court of Appeals (CA) on March 11, 2011. The Supreme Court's decision was rendered on January 13, 2016.
Applicable Law
The case primarily relates to the provisions of Presidential Decree (P.D.) No. 957, which governs the regulation of real estate trading, and P.D. No. 1344, which expanded the jurisdiction of the National Housing Authority (NHA). Additionally, P.D. No. 1216 defines open spaces in residential subdivisions and states that these areas are non-alienable and non-buildable.
Background of the Case
Mover Enterprises, Inc. failed to honor its obligations under the loan with PCIB, prompting foreclosure. SHHA's assertion that the lot was designated as an open space based on a subdivision plan alteration was initially dismissed by the HLURB Arbiter, who found insufficient evidence that the properties aligned. However, following further review, the HLURB concluded that the designated open space had indeed been mortgaged and became the subject of the annulment proceedings.
Proceedings before the HLURB and Appeals
SHHA appealed to the HLURB Board, which ultimately recognized that the mortgage over Block 7 was void due to its designation as an open space under the revised subdivision plan. After the OP upheld the HLURB's ruling, the case proceeded to the CA, where Banco de Oro raised questions regarding the HLURB’s jurisdiction over the complaint and claimed its right as a mortgagee in good faith.
CA Decision and Further Appeals
The CA affirmed the OP's ruling, reinforcing HLURB's jurisdiction over such disputes. The CA's decision highlighted Mover’s obligation to pay the loan amount plus interest, affirming the debt despite the mortgage's invalidation. Banco de Oro's petition to the Supreme Court challenged both the HLURB's jurisdiction and the validity of the evidence presented by SHHA.
Supreme Court Findings
The Supreme Court upheld the findings of the lower courts, reiterating that the HLURB had jurisdiction over the annulment of mortgages for properties designated as open spaces. The Court found that SHHA's evidence substantiated the claim that the
...continue readingCase Syllabus (G.R. No. 228232)
Case Citation
- G.R. No. 198745, January 13, 2016
- 778 Phil. 254
Court and Division
- THIRD DIVISION of the Supreme Court of the Philippines
Parties Involved
- Petitioner: Banco de Oro Unibank, Inc. (formerly Banco de Oro-EPCI, Inc.)
- Respondent: Sunnyside Heights Homeowners Association, Inc.
Procedural History
- The case originated from a Petition for Review on Certiorari under Rule 45 of the Rules of Court.
- It seeks to annul the Decision dated March 11, 2011, of the Court of Appeals (CA) in CA-G.R. SP No. 101740.
- The CA's decision affirmed, with modification, the Decision dated November 22, 2007, of the Office of the President (OP) in O.P. Case No. 97-E-8033.
Facts of the Case
- Mover Enterprises, Inc. is the owner and developer of the Sunnyside Heights Subdivision located in Batasan Hills, Quezon City.
- In March 1988, Mover mortgaged Lot 5, Block 10 to the Philippine Commercial International Bank (PCIB), securing a loan of ₱1,700,000.00.
- Mover defaulted on the loan, leading PCIB to foreclose the mortgage, resulting in the issuance of TCT No. 86389 in PCIB's name on May 17, 1993.
- In mid-1994, PCIB advertised the property for sale, prompting SHHA to file a complaint with the Housing and Land Use Regulatory Board (HLURB). The complaint sought to declare the mortgage void, asserting that the lot had been allocated as open space.
- PCIB contended that the lot was distinct from that mentioned in SHHA’s complaint and maintained its status as an innocent mortgagee in good faith.
- On August 28, 1995, the HLURB Arbiter dismissed SHHA’s complaint for lack of cause of action, stating that the properties referenc