Case Summary (G.R. No. 107225)
Key Individuals and Context
Petitioner San Miguel Properties, Inc. (domestic real estate developer) purchased 130 subdivision lots from BF Homes, Inc., then under SEC-appointed receiver Atty. Florencio B. Orendain. Respondents are the former directors and officers of BF Homes. Central to the dispute is BF Homes’s alleged refusal to deliver 20 Transfer Certificates of Title (TCTs) for fully paid lots sold in April 1993, on the ground that Orendain lacked authority after his receivership tenure ended.
Parties, Transactions, and Receivership Issues
• San Miguel Properties bought lots in 1992–1993 for P106.25 million (three deeds).
• First two deeds’ TCTs delivered; the third deed (20 lots, P39.12 million) remained undelivered.
• BF Homes contended that Orendain had ceased as receiver on May 17, 1989, and transactions were void.
• San Miguel Properties filed a criminal complaint (OCP Las Piñas, I.S. No. 00-2256) for non-delivery under Sec. 25, PD 957, and an HLURB petition for specific performance (REM-082400-11183).
Prosecutorial Proceedings and Early Resolutions
• Respondents raised: lack of Orendain’s authority, irregular deeds, pending receivership jurisdiction (custodia legis), and exclusive HLURB competence.
• San Miguel moved to suspend OCP proceedings citing SEC receivership pendency; BF Homes opposed.
• SEC receivership terminated September 12, 2000; San Miguel withdrew suspension motion.
• OCP Las Piñas (Oct 23, 2000) dismissed criminal complaint for lack of SEC leave, prejudicial question, exclusive HLURB jurisdiction, and no prior administrative resort.
• Reconsideration denied (Feb 20, 2001); OCP held criminal liability contingent on HLURB directive.
• DOJ Secretary denied appeal (Oct 15, 2001), affirming need for HLURB to first rule on transaction validity under PD 957.
Court of Appeals Decision on Prosecutorial Discretion
• San Miguel filed certiorari and mandamus (CA-G.R. SP No. 73008).
• CA (Feb 24, 2004) upheld DOJ: an administrative case (HLURB) may constitute a prejudicial question; postponement avoids conflicting rulings on Orendain’s authority and respondents’ obligations.
• CA cited Quiambao, primary jurisdiction doctrine, and exceptions to prejudicial-question rule.
• Reconsideration denied (Jan 18, 2005).
HLURB Proceedings on Specific Performance
• HLURB Arbiter (Jan 25, 2002) inclined to suspend until SEC resolved Orendain’s authority.
• HLURB Board affirmed suspension under primary-jurisdiction rationale.
• Office of the President (Jan 27, 2004) reversed HLURB, directing it to decide on specific performance without awaiting SEC, invoking its exclusive PD 957 mandate.
Court of Appeals Remand of HLURB Case
• BF Homes appealed OP ruling (C.A.-G.R. SP No. 83631).
• CA held HLURB—not SEC—had jurisdiction; affirmed OP; remanded for evidence presentation under primary jurisdiction.
Issues Presented to the Supreme Court
- Whether DOJ Secretary gravely abused discretion in dismissing the criminal complaint for lack of probable cause and on prejudicial-question grounds.
- Whether the HLURB case must precede the criminal prosecution.
- Whether respondents’ non-delivery (malum prohibitum) overrides prejudicial-question suspension.
- Whether respondents—who did not initiate the HLURB case—may invoke prejudicial-question defense.
Supreme Court Ruling—Prejudicial Question Doctrine
• Prejudicial question (Rule 111, Sec. 7, Rules of Court): a prior action—though usually civil—raises an issue whose resolution is a logical antecedent to the criminal case and lies in another forum.
• HLURB specific-performance action is civil in nature, exclusively vested in that tribunal.
• Resolution of Orendain’s authority and delivery entitlement in HLURB is determinative of respondents’ criminal liability under
Case Syllabus (G.R. No. 107225)
Parties and Transactions
- Petitioner: San Miguel Properties, Inc., a domestic corporation engaged in real estate.
- Respondents: SEC Secretary Hernando B. Perez et al.; directors and officers of B.F. Homes, Inc.
- San Miguel bought 130 residential lots from BF Homes (1992–April 1993) for ₱106,248,000.
- Transfer Certificates of Title (TCTs) for 20 lots (₱39,122,627) under the third deed were not delivered.
Dispute and Contentions
- BF Homes withheld 20 TCTs, claiming Atty. Orendain lacked authority after SEC replaced him as receiver in 1989.
- BF Homes’ defenses in the criminal and HLURB proceedings:
- Orendain’s lack of authority rendered the sale void.
- Deeds of sale were undated and unnotarized.
- Claims should be before the SEC receivership.
- Receivership required suspension of all claims.
- Lots were under custodia legis, divesting jurisdiction of the City Prosecutor.
Lower Proceedings: OCP and DOJ
- August 15, 2000: San Miguel filed
- Criminal complaint (PD 957 §§ 25, 39) in OCP Las Piñas.
- HLURB case for specific performance.
- OCP Las Piñas (Oct 23, 2000): Dismissed criminal complaint due to:
- Need for SEC leave to sue a receiver.
- HLURB’s exclusive jurisdiction over PD 957 matters.
- Prejudicial question pending before SEC/HLURB.
- OCP Reconsideration Denial (Feb 20, 2001): Held no probable cause absent HLURB decision.
- DOJ Secretary Appeals Denied (Oct 15, 2001; July 12, 2002):
- Affirmed need for HLURB to rule on validity of transactions before criminal charges.