2011 HLURB Revised Rules of Procedure

Legal basis and adoption authority

Section 5 (c) and (j) of Executive Order No. 648, Series of 1981 as amended by Executive Order No. 90, Series of 1986 empowers HLURB to act through procedural rules and related functions.
Executive Order No. 535, Series of 1979 as amended by Section 26 of Republic Act No. 8763 provides additional legal basis for HLURB action.
Republic Act No. 9904 is cited as part of the statutory framework supporting HLURB issuance of procedural rules.

Policy on just and speedy procedure

HLURB proceedings under these Rules are designed to promote the general welfare and to assist the parties in obtaining a just and speedy determination of every action, application, or proceeding.
HLURB proceedings are summary in nature.
The Rules of Court apply suppletorily.

Scope, coverage, and venue

These Rules apply to disputes and controversies including:
- Actions concerning unsound real estate business practices filed by buyers.
- Claims involving refund and other claims filed by subdivision lot or condominium unit buyers against the project owner, developer, dealer, broker, or salesman.
- Cases involving specific performance of contractual and statutory obligations filed by subdivision lot or condominium unit buyers against the project owner, developer, dealer, broker, or salesman.
- Intra-association disputes among and between members of homeowners associations.
- Inter-association disputes between two or more homeowners associations.
- Disputes between a homeowners association and the state insofar as they concern the association’s individual franchise or right to exist and are intrinsically connected with regulation of homeowners associations or internal affairs.
- Suits in opposition to applications for:
  - certificate of registration and license to sell,
  - development permit for condominium projects,
  - clearance to mortgage, or
  - the revocation or cancellation thereof,
  - and locational clearances, certifications or permits when issued by the Regional Field Office of HLURB.
- Appeals from decisions of local and regional planning and zoning bodies.
- Other analogous cases.
All complaints or actions must be filed in the Regional Field Office that has jurisdiction over the area where the project involved is located.
For homeowners association suits, complaints are filed in the Regional Field Office where the homeowners association is registered.
HLURB treats oppositions to applications for clearance, permit, or license as complaints for procedural purposes.

Parties, pleadings, and filings

Every action or proceeding must be prosecuted and defended in the name of the real party in interest.
Parties who claim an interest in the subject matter and the relief demanded are called “complainants”.
Parties who claim an interest adverse to the complainant, or are necessary to a complete determination or settlement, are called “respondents.”
Indigent litigants are governed by Supreme Court rules on indigent litigants and exemption from payment of filing fees.
A member of a homeowners association in good standing may bring a derivative suit on behalf of the association if:
- the complainant was a member at the time of the acts or transactions and at the time the action was filed;
- the complaint alleges with particularity that reasonable efforts were exerted to exhaust all remedies under the association’s articles of incorporation, bylaws, laws, or rules; and
- the complaint states a valid cause of action.
Counsel representation is optional, but if a party is represented by counsel, the lawyer must indicate in pleadings:
- a mailing address not a post office box number, including the lawyer’s telephone/cellular phone number and email address if available;
- Roll of Attorneys Number;
- Current Professional Tax Receipt Number, with date and place of issue;
- IBP Official Receipt Number or IBP Lifetime Membership Number, with date and place of issue;
- Mandatory Continuing Legal Education Compliance or Exemption Certificate Number, with date of issue.
If a non-lawyer represents a party, a special power of attorney and a duly executed affidavit by the represented party stating the reasons for authorization must be attached.
If the real party in interest is out of the country, the special power of attorney must be authenticated by the relevant consular office and comply with other applicable formalities.
If the real party in interest is a corporation, the complaint must include a board resolution authorizing the representative.
Failure to comply with the counsel/representative attachment requirements renders the pleading not filed.
Pleadings and motions must be filed in triplicate, plus additional copies for respondents, with proof of service.
Mandatory pleadings include the Complaint, Answer, and Appeal Memorandum.
Discretionary pleadings may be filed if not prohibited; their filing does not toll reglementary periods and their failure does not adversely affect the rights of the parties.
Prohibited pleadings and motions that shall not be entertained include:
- Motion to dismiss;
- Motion for a bill of particulars;
- Petition for relief from judgment;
- Motions for reconsideration in any stage;
- Appeal from any interlocutory order (including cease and desist orders);
- Motions for extension of time;
- Motions for postponement (except for justifiable reasons);
- Motion to admit pleadings filed beyond the reglementary period;
- Reply except in answer to a compulsory counterclaim;
- Fourth and subsequent party complaints; and
- Motion for clarification of final orders and decisions.
Filing prohibited pleadings/motions does not interrupt prescriptive period and does not bar adjudication.
An opposition to a motion may be filed within five (5) days from receipt of the motion.

Complaint requirements and forum shopping controls

A complaint must include:
- A caption and the title identifying the complainant and respondent (as “Complainant” and “Respondent”).
- The full name of real parties in interest, showing capacity to sue and be sued, status, mailing address, designation, and a concise statement of ultimate facts supporting the cause of action, claims, or reliefs, with the date of preparation.
- The relief sought, with a general prayer for other just and equitable relief.
- Signature and counsel certification that:
  - counsel has read the complaint;
  - counsel believes there is good ground to support it based on knowledge and information; and
  - it is not interposed for delay.
- Verification by affidavit stating that the complainant read the complaint and that allegations are true and correct based on the complainant’s personal knowledge.
- A certification against forum shopping stating under oath:
  - no prior action/claim involving the same issues has been commenced or is pending in any court/tribunal/quasi-judicial agency;
  - if another action/claim is pending, the status must be stated; and
  - if the complainant learns of a similar action/claim filed or pending, the complainant must report to HLURB within five (5) days.
The complaint filed must be accompanied by:
- proof of payment of filing fees;
- documentary evidence supporting the cause of action; and
- homeowners association election-related certification stating that parties were invited to settle but no amicable settlement was reached, issued by the chair of the Election Committee (or Grievance Committee or other association committee constituted to resolve the controversy).
If there is no Election Committee/Grievance Committee or there is refusal to issue the certification, the complainant must submit an affidavit attesting to that fact and stating that administrative remedies were exhausted.
Non-compliance with any complaint requirement is a ground for dismissal without prejudice.
Deliberate forum-shopping results in dismissal with prejudice.
Defects in signature or verification are corrected during the mandatory conference; refusal to rectify after direction by the Arbiter results in dismissal without prejudice.
Defect in the certification against forum shopping is a ground for dismissal without prejudice.

Permit/opposition procedure and dispositive executory effect

An opposition to an application for clearance, permit, or license is treated as a complaint under Rule 5, except where otherwise provided.
Opposition to an application for locational clearance for projects of national or regional significance filed with a Regional Field Office is elevated to the Board of Commissioners which assumes original jurisdiction and resolves the opposition.
Projects are presumed local significance unless declared by NEDA otherwise.
Rules on contested applications for license, permit, or clearance apply to cases for revocation thereof.
Decisions of the Board of Commissioners regarding permits, licenses, or clearances are immediately executory notwithstanding any appeal.

Commencement, summons, answers, and conferences

An action is commenced by filing a verified complaint with the Regional Field Office in triplicate plus required copies, with supporting documents, and upon payment of required filing fees.
If filed by registered mail, an action is deemed commenced on the date of mailing.
The registered-mail complaint must attach a money order for filing fees payable to HLURB; failure to include the money order causes dismissal.
Filing fees are determined by the Regional Field Office and must be paid at the time of filing.
Non-payment of filing fees at filing time is a jurisdictional defect and causes dismissal without prejudice.
Deficient payment: failure to fully pay within five (5) days from notice of deficiency as determined by the Arbiter causes dismissal without prejudice.
Upon filing and payment, the Regional Field Office assigns the case by raffle to an Arbiter within three (3) days.
Summons is issued immediately upon the Arbiter’s determination that the complaint is sufficient in form and substance.
Service rules provide that summons/notices/resolutions/orders/decisions are served personally by process server or by registered mail, within two (2) days from receipt by the process server for service, subject to special circumstances under Rules of Court.
The return of service must be submitted to the Regional Field Office within three (3) days from service, detailing process server information, persons served, and date of receipt.
Notices may be served through facsimile or electronic mail if accompanied by an affidavit explaining how notice was effected and how receipt was verified.
Registered-mail service is complete upon receipt by the addressee or agent; if the addressee fails/refuses to claim within five (5) days from first notice by the postmaster, service takes effect after such period.
The respondent must file a verified answer or responsive pleading within a non-extendible period of ten (10) days from receipt of summons, furnishing complainant a copy.
All grounds for motion to dismiss, counterclaim, or cross-claim must be pleaded in the answer or incorporated, or deemed waived.
If the respondent fails to file an answer within ten (10) days, the Arbiter directs complainant to file within ten (10) days:
- a verified position paper and
- draft decision with supporting documents,
  after which the case is deemed submitted for resolution.
Mandatory conference is required, including mediation, and must be concluded within thirty (30) calendar days from the date of initial conference.
Within three (3) days from receipt of the Answer, the Arbiter issues notices for the mandatory conference covering settlement mediation, simplification of issues, admissions/stipulations, additional documentary evidence, and preliminary matters.
The mandatory conference is terminated within thirty (30) days from the initial conference date.
Mediation is conducted by the Arbiter or a Mediator assigned by the Arbiter; mediation is not conducted if conciliation/other ADR modes were already resorted to prior to filing.
Mediation information is confidential.
Party appearance in mediation is mandatory; if personal appearance is not possible, representatives must present special power of attorney or board resolution with full authority to enter compromise.
Failure to appear in mediation allows the present party to move for termination or resetting in accordance with the initial conference schedule.
If compromise is reached:
- the agreement must be reduced in writing, signed by parties, and attested by the Arbiter or Mediator;
- judgment based on the compromise must be rendered immediately, and is final and executory.
If no compromise is reached, mediation is terminated and a certificate is issued; if mediated by a Mediator, the case returns to the Arbiter.

Position papers, draft decisions, and decision timing

When the mandatory conference is terminated within the 30-day period, the Arbiter orders the parties to simultaneously file within fifteen (15) days from receipt:
- respective position papers jointly verified by the parties and counsels;
- affidavits of witnesses and documentary evidence; and
- draft decisions provided for by Executive Order No. 26.
Position papers and draft decisions must state facts, issues, and applicable laws and jurisprudence relied upon.
The Arbiter may require ocular inspection and/or clarificatory hearings, provided they are held within the thirty (30) days resolution period.
A case is deemed submitted for resolution upon filing of position papers/draft decisions or upon expiration of the period to file.
The Arbiter resolves within thirty (30) days from submission for resolution.
Pending motions and unresolved incidents filed after submission are resolved in the judgment.
The Arbiter sends notice of the judgment through the process server within three (3) days from resolution.

Arbiter powers, inhibition, and regional support

The Arbiter has authority to:
- hear and decide HLURB cases cognizable under these Rules;
- issue subpoena ad testificandum and subpoena duces tecum;
- issue cease and desist orders and other provisional remedies allowed under these Rules;
- take judicial notice of corporate records of the association or the subdivision/condominium technical docket when necessary;
- cite and/or declare any person in direct or indirect contempt;
- impose fines and/or other penalties for violations of these Rules, related laws and regulations, or any HLURB order/resolution/decision;
- perform other powers assigned by the Board of Commissioners.
Mandatory inhibition applies if:
- the Arbiter’s spouse, child, or relative within the sixth degree of consanguinity or affinity is directly or indirectly interested;
- the Arbiter is related to either party or counsel within the sixth degree; or
- the Arbiter participated as counsel in the same case.
The Arbiter may motu proprio inhibit if any of the enumerated grounds or other justifiable grounds exist, by issuing an order stating the basis.
A party seeking inhibition must file a motion stating grounds and evidence; the Arbiter rules on the motion.
If the Arbiter inhibits, the Regional Officer raffles the case to another Arbiter; if no other arbiters exist, records are transmitted to the Legal Affairs Group.
If a Regional Field Office has no Arbiter, a duly authorized Legal Officer performs Arbiter functions except:
- deciding the case,
- issuing cease and desist orders and provisional remedies, and
- citing parties in contempt (which are performed by the Legal Affairs Group).
After position papers are filed or the case is deemed submitted, the Legal Officer transmits records to Legal Affairs Group within five (5) days with notice.
The Legal Affairs Group director assigns by raffle to a Legal Affairs Group Arbiter within three (3) days from receipt; the Legal Affairs Arbiter resolves within thirty (30) days from assignment.
After resolution, records return to the Regional Field Office for release and service of judgment.

Board of Commissioners appeal mechanics

The Board of Commissioners consists of the Chairman, four (4) full-time Commissioners, and four (4) ex-officio Commissioners representing NEDA, DOJ, DILG, and DPWH.
The Board has jurisdiction over:
- exclusive jurisdiction over controversies involving orders and issuances of the Regional Officer;
- original jurisdiction over oppositions to locational clearance applications for projects of national or regional significance;
- appellate jurisdiction over Arbiter judgments;
- appellate jurisdiction over decisions of local and regional planning and zoning bodies;
- other cases provided by law.
Adjudicatory functions are exercised through:
- four (4) Regular Divisions (two (2) full-time and one (1) ex officio Commissioner each); and
- a Special Division (all four (4) full-time Commissioners).
Quorum is:
- at least two (2) Commissioners in a regular division; and
- three (3) Commissioners in the special division.
Judgment requires concurrence of a majority of Commissioners present and constituting quorum.
Dissenting opinion may be filed by a member of a division.
No motion to inhibit the entire division is entertained; any Commissioner may inhibit from a case/matter and must state written legal/justifiable grounds.
Cases involving same parties/issues/related questions may be consolidated in the division where the lowest case number is assigned.
On appeal, only the Appeal Memorandum and Counter-Memorandum are allowed unless the Board directs otherwise; other pleadings do not toll the appeal resolution period.
An appeal from an Arbiter decision may be taken on any legal ground upon payment of the appeal fee by filing a verified Appeal Memorandum in three (3) copies within fifteen (15) days from receipt of the decision with the Regional Field Office.
Within five (5) days from receipt of the appeal memorandum, the Regional Field Office elevates records to the Board with a summary of proceedings.
An Appeal Memorandum must include:
- designation under HLURB jurisdiction and updated party captions (“Appellant” and “Appellee”);
- date of appellant’s receipt of the appealed decision;
- facts/incidents with material dates;
- issues to be resolved;
- grounds for appeal;
- ultimate claims/reliefs;
- verification consistent with complaint verification rules;
- an affidavit of service on the other party and registry return receipt attached; and
- appeal bond for money judgments equivalent to the amount of the award and actual damages excluding interests, other damages, and attorney’s fees.
Surety bonds must be issued by a reputable Supreme Court-accredited bonding company and include:
- joint declaration under oath by appellant and bonding company that bond is genuine and effective until final disposition;
- indemnity agreement between appellant and bonding company;
- proof of security deposit or collateral securing the bond, with checks not acceptable security;
- certificate of authority from the Insurance Commission;
- certificate of registration from the SEC;
- certificate of authority to transact surety business from the Office of the President;
- Supreme Court certificate of accreditation and authority;
- notarized board resolution or secretary’s certificate of authorized signatories and specimen signatures.
An appeal bond in cash or surety is valid from date of deposit/posting until final decision, termination, or satisfaction of the award.
The appellant must furnish the appellee with a certified true copy of the surety bond and supporting documents; appellee must verify regularity and genuineness and immediately report irregularities to the Board.
Upon Board verification that the bond is irregular or not genuine, the Board dismisses the appeal and censures/cites in contempt responsible parties and their counsels, or subjects them to reasonable fine or penalty.
A Counter-Memorandum must be filed in three (3) copies within a non-extendible ten (10) days from receipt of the Appeal Memorandum, without waiting for a separate Board order, with proof of service.
Filing an appeal stays execution of the Arbiter’s decision or order unless otherwise provided by these Rules.
The Board may receive new evidence, order further proceedings, or take judicial notice of other HLURB records, provided these occur within the sixty (60) days resolution period.

Grounds for appeal dismissal and final appeal judgment

The Board dismisses an appeal on grounds including:
- filing beyond the reglementary period;
- failure to state date of receipt of the decision;
- joint motion to dismiss;
- withdrawal of appeal;
- failure to pay appeal fees;
- failure to post appeal bond;
- failure to furnish the other party a copy of the Appeal Memorandum; or
- failure to comply with Board orders and/or Rule requirements.
The Board resolves the appeal within sixty (60) days from the date the appeal is submitted for resolution.
The Board notifies parties of the judgment by serving a copy.
No motion for reconsideration is allowed or entertained from the Board’s judgment on appealed cases.

Finality and execution rules

Decisions/orders of the Arbiter and Board are final and executory in these periods:
- Arbiter decisions/orders become final and executory fifteen (15) days after receipt by parties if no appeal is filed within that period.
- Board decisions/orders become final and executory fifteen (15) days after receipt by parties if no appeal is filed within that period.
Execution issues only upon motion of an interested party after a final decision/order:
- the motion must be filed with the Regional Field Office of origin, with copy furnished to other parties; and
- it must be accompanied by:
  - the original or certified true copy of the entry of judgment or certificate/order of finality (Board/OP/CA/SC as applicable); and
  - certified true copies of all judgments in the case.
The Arbiter resolves the motion for execution and issues the writ within fifteen (15) days from receipt.
If an opposition is filed, the Arbiter resolves the incident within fifteen (15) days from receipt of the opposition, and the opposition must be filed within five (5) days from receipt of the motion.
Writs of execution are issued by the Arbiter and directed to the sheriff concerned.
Pleadings/motions in execution proceedings framed as disguised appeals on collateral issues already passed upon are not entertained.
Incidents pertaining to execution are resolved by the Arbiter.
Where execution pending appeal is allowed, the moving party must post a bond required to answer for damages the adverse party may sustain if the movant is ultimately not entitled; the bond is required on terms the Arbiter considers proper to protect or secure rights of the adverse party.

Provisional remedies: management committee and cease-and-desist

Provisional and special remedies covered include:
- creation of management committee;
- cease and desist order;
- contempt;
- inspection of books and records; and
- other applicable provisional and special remedies in the Rules of Court.
Provisional remedies are incident to the main case and are availed of by motion.
Special remedies are initiated as main cases and are availed of by verified petition or verified complaint under the complaint requirements.
Judgments under this Part are immediately executory without prejudice to appeal in accordance with Part 3.

Management committee

The Arbiter or the Board may create a management committee upon verified petition or motion by a party to manage day-to-day operations of a homeowners association until new officers are elected.
Management committee members are considered agents of HLURB and are under the control and supervision of the Arbiter, Board, or authorized representative.
The committee must have at least three (3) members:
- one nominated by each party; and
- the third nominated by the Arbiter/Board from a list submitted by the parties.
If a party fails/refuses to nominate, the Arbiter/Board appoints the necessary nominee(s).
Committee members are not eligible to run in the next election.
A management committee is created only upon establishment that no other adequate remedy is available and that it is necessary to:
- avert dissipation/loss/wastage/destruction of association assets or properties;
- prevent paralyzation of operations prejudicial to members and the general public; or
- address nullification of the election of incumbent officers where hold-over would frustrate or render nugatory the invalidation.
Committee action requires a majority vote of its members.
The chairman is chosen by members from among themselves.
The Arbiter/Board/authorized representative must approve and ratify official acts and transactions.
Reasonable expenses of the management committee and hired persons are reimbursed as approved and are treated as administrative expenses shouldered by the homeowners association.
Members and employed persons are immune from suit for acts done in good faith in exercise of functions and powers.
The committee must report:
- within thirty (30) days from appointment; and
- monthly thereafter to the Arbiter/Board/authorized representative on the association’s condition.
The committee is discharged/dissolved when:
- the Arbiter/Board/authorized representative determines the necessity no longer exists; or
- proceedings terminate including election and qualification of a new board and officers.
Upon discharge and dissolution, within the reasonable time allowed by the Arbiter/Board/authorized representative, the committee must submit a final report, render an accounting, and turn over all records and assets to duly qualified officers.

Cease and desist orders

A cease and desist order directs a party to refrain from specified acts pending case resolution.
Upon receipt of a complaint with an application for cease and desist order, the Arbiter sets the application for hearing no later than five (5) days from the issuance of summons and notice.
A cease and desist order issues only when competent proof clearly establishes concurrence of:
- the adverse party is doing/threatening/about to do/procuring acts probably violating existing laws/regulations implemented by HLURB or applicant’s rights, tending to render judgment ineffectual;
- the applicant is entitled to the relief demanded and the relief restrains commission/continuance for a limited period or perpetually; and
- commission/continuance would cause grave and irreparable injury.
If granted, the Arbiter requires the applicant to file a bond to answer for damages the adverse party may sustain if the applicant is later found not entitled.
Cease and desist orders are immediately executory without prejudice to appeal.
Appeal from the main case does not automatically stay a cease and desist order unless the Board so orders and a supersedeas bond is posted in an amount twice the bond required in the cease and desist order.

Contempt and inspection of association records

Direct contempt occurs when any person/entity/enterprise commits disorderly or disrespectful conduct before the Board, its members, or Arbiters/Mediators, or in their presence during official functions/hearings/inquiries, obstructing, distracting, interfering, or disturbing performance; the contemnor is declared in direct contempt and may be summarily imposed a fine of PHP 2,000.00 and/or confined for a period not exceeding the duration of the hearing/proceeding