Legal basis and repealed issuances

The rules are adopted pursuant to Section 5 (c) and (j) of Executive Order No. 648, Series of 1981, as amended by Executive Order No. 90, Series of 1986, and Executive Order No. 535, as amended by Section 26 of Republic Act No. 8763.
The rules expressly repeal Resolution Nos. 537 and 538, Series of 1994, Resolution No. R-586, Series of 1996, Resolution No. R-655, Series of 1999, and all other inconsistent resolutions and administrative issuances or parts thereof.
Where the rules provide a procedural structure, the Rules of Court do not apply, except in a suppletory character.

Policy, nature of proceedings, and construction

Proceedings before the Board are summary in nature.
The Rules of Court apply only suppletorily.
The rules must be liberally construed to promote public interest and to assist the parties in obtaining just, speedy and inexpensive determination of every action, application, or other proceeding.
Decisions and orders may become final and executory based on the applicable finality rules under Rule XXII.

Parties and case categories

In a complaint filed before the Board, the filing party is the complainant and the adverse party is the respondent.
A complaint may be filed by either spouse even if only one of them is a signatory to the contract.
In applications, the entity seeking issuance of a license, permit, or clearance or authority to exercise a right or privilege under laws administered or implemented by the Board is the applicant.
Any person, natural or juridical, or entity authorized by law who claims an adverse right or interest in an application filed with the Board or in its subject matter is the oppositor.
For election-related disputes in homeowners associations, Rule VI defines election contests and establishes a special election-contest complaint regime.

Commencement, summons, and responsive pleadings

An action is deemed commenced upon the filing of a verified complaint in three (3) copies (and such number of copies as there are respondents), with supporting documents, and upon payment of filing fees, in the Regional Office.
A certification of non-forum shopping compliant with Supreme Court Circular No. 28-91, as amended must be attached to the complaint.
Upon filing and payment of correct filing fees, and upon a finding that the complaint is sufficient in form and substance, summons must be issued forthwith to the respondent.
Summons and a copy of the complaint must be served in person or by leaving a copy with a competent person of suitable age and discretion in charge of respondent’s office or residence; if refused, summons is effected by tendering or leaving a copy at the address on record.
The server must execute an affidavit of service within three (3) days from service.
When personal service is impracticable or difficult, summons may be served by registered mail.
Where respondent is an unknown person/entity or whereabouts are unknown despite diligent inquiry, service may be made by publication once a week in two consecutive weeks in a newspaper of general circulation, upon leave.
The respondent must file a verified responsive pleading or answer (with supporting documents) within a non-extendible period of twenty (20) days from receipt of summons, and furnish a copy to the complainant.
Any grounds for a motion to dismiss, counterclaim, or crossclaim must be pleaded or incorporated in the answer; otherwise they are waived.
A third-party complaint may be filed by respondent with leave of the Arbiter if grounds are manifested in the answer.

Executive Committee elevation and preliminary screening

In oppositions to an application for a license, permit, or clearance filed with the Board or its Regional Field Offices, the Regional Officer must preliminarily evaluate whether the case has significant economic, social, environmental, or national policy implications as determined by the Board.
If the Regional Officer determines significant policy implications exist, the Regional Officer must transmit the records to the Executive Committee, which assumes original jurisdiction over the case.
Otherwise, the Regional Officer must act and resolve the opposition.
In cases referred to the Executive Committee, the Executive Committee is assisted by the Board Secretarial and such other groups tasked by the Committee.

Remedies for elevation/non-elevation

Any party aggrieved by elevation or non-elevation of a contested application may file a verified appeal to the Executive Committee within fifteen (15) days from notice of elevation or non-elevation.
The Executive Committee resolves whether it shall assume jurisdiction.

Prohibited pleadings in original proceedings

The following are prohibited pleadings and are not entertained:
- a. Motion to dismiss
- b. Motion for extension of time to file answer
- c. Motion to admit answer filed beyond the reglementary period
- d. Reply, except in answer to a compulsory counterclaim
- e. Rejoinder and answer to rejoinder
- f. Motion for bill of particulars
- g. Fourth and subsequent party complaint
- h. Motion for reconsideration of any order or decision of the Arbiter
Filing a prohibited pleading does not interrupt the running of the period for filing an answer and does not bar adjudication.
Prohibited pleadings must be expunged from the case records.
Petitions for certiorari, mandamus, prohibition or injunction from any interlocutory order of the Arbiter are also prohibited pleadings.

Default and lifting default

If respondent fails to answer or file a responsive pleading within twenty (20) days from service/receipt, the Arbiter or Executive Committee may declare respondent in default motu proprio or upon motion of the complainant with notice and proof of service.
In license, permit, or clearance oppositions, if applicant fails to file answer/comment within twenty (20) days from notice from the Regional Office or Executive Committee, the Regional Officer, Arbiter or Executive Committee must, upon motion of the oppositor with notice to applicant, declare applicant in default and render judgment based on documents already on record.
A motion to lift default and admit the answer attached must be filed within five (5) days from receipt of the default order.
The motion must include an affidavit of merit showing fraud, accident, mistake, or excusable negligence and a meritorious defense.
Upon default, the Arbiter or Executive Committee directs complainant to file a verified position paper and draft decision and then renders judgment granting relief warranted by pleadings; the defaulted party receives notice of subsequent proceedings but cannot submit position papers or participate in clarificatory hearings or examination of records required by the Arbiter.
If default is lifted, the answer is admitted and the Arbiter orders the respondent to file position paper and draft decision for submission for resolution.
If judgment by default is rendered, the defaulted party may appeal under Rule XVI and may raise whatever defenses remain available in the appeal.

Election contests in homeowners associations

Rule VI applies to election contests in homeowners associations.
“Election contest” includes disputes involving title or claim to an elective office in a homeowners association; validation of proxies; manner and validity of elections; qualification of candidates; proclamation of winners; and assumption to office of director, trustee, or other officer directly elected by members where the articles of incorporation or by-laws so provide.
The election-contest complaint must state filing within fifteen (15) days from the date of election if the by-laws provide no procedure, or within fifteen (15) days from receipt of the association’s resolution if its by-laws provide for resolution.
Within five (5) days from filing, the Arbiter with approval of the Regional Officer may dismiss outright if not sufficient in form/substance, or if sufficient, order summons to be issued and sent to respondent within ten (10) days from issuance.
Respondent must file a verified responsive pleading/answer with supporting documents within a non-extendible ten (10) days from receipt of summons.
If respondent fails to answer within the period, the Arbiter may within ten (10) days from lapse render judgment warranted by complaint allegations and the affidavits, documentary and other evidence on record, without awarding relief beyond that prayed for.
Before or after submission for resolution, the Arbiter may require a clarificatory conference, hearing, examination of election-related documents, or submission of additional evidence to clarify factual issues.
The Arbiter renders decision based on pleadings, affidavits, documentary and other evidence on record.
Decisions and orders under this election rule are immediately executory, and an appeal does not automatically stay enforcement unless restrained by the Board of Commissioners.
Any party aggrieved by the Regional Office decision may appeal under Rule XVI.

Derivative suits

A member may bring an action in the name of the homeowners association if:
- (a) the member was a member at the time of the acts/transactions sued upon and at the time the action is filed;
- (b) the member exerted reasonable efforts to exhaust remedies under the articles, by-laws, laws, or rules governing the association and alleges exhaustion efforts with particularity in the complaint; and
- (c) the cause of action involves directors/officers wasting or dissipating association funds, fraudulently disposing of association assets, or committing ultra vires acts.
A derivative action may not be discontinued, compromised, or settled without approval of the Regional Office or the Board of Commissioners.
During pendency, any sale, transfer, or assignment of rights or interest of the complaining member or the association must be approved by the Regional Office or the Board.
If the Regional Office or Board determines members’ interests will be substantially affected, it may direct notice by publication or otherwise to the affected members.

Inspection rights and enforcement

Rule VIII applies to disputes solely involving members’ rights to inspect association books and records and/or to be furnished with financial statements or reports required by the Board, and where applicable those required under Sections 74 and 75 of the Corporation Code of the Philippines.
The complaint must state:
- (a) it is for enforcement of the complainant’s right to inspect books/records and/or be furnished financial statements/reports referenced in the rule;
- (b) a demand for inspection and copying and/or furnishing of financial statements was made upon respondent;
- (c) respondent refused the demands; and
- (d) the refusal is unjustified and illegal, with law and jurisprudence supporting the allegation.
Within five (5) days from filing, the Arbiter with approval of the Regional Officer may dismiss outright if insufficient in form/substance, or if sufficient, order summons served on respondent within ten (10) days from issuance.
Respondent must file an answer within ten (10) days from service of summons and complaint and provide a copy to complainant.
In addition to Rule III requirements, the answer must state:
- (a) grounds for refusal;
- (b) conditions/limitations on inspection the Arbiter should impose if inspection is granted; and
- (c) cost of inspection including manpower and photocopying expenses if inspection is granted.
Parties must attach to complaint and answer the affidavits or witnesses and documentary and other evidence in support, if any.
If respondent fails to answer within the period, the Arbiter shall, upon motion, render judgment warranted by allegations and evidence within thirty (30) days from receipt of the motion, without awarding relief beyond or different from that prayed for.
The Arbiter with approval of Regional Officer must render decision based on pleadings, affidavits and documentary and other evidence within thirty (30) days from receipt of the last pleading.
A decision ordering inspection and/or furnishing copies must also order deposit by complainant of the estimated cost of manpower and copying and must state clearly and categorically the limitations and conditions on the exercise of the right allowed or enforced.
Orders, resolutions, and decisions under this rule are immediately executory unless otherwise ordered by the Board of Commissioners.

Management committee appointment

A party may apply for appointment of a management committee as an incident to homeowners association cases under the rules when:
- (a) there is imminent danger of dissipation, loss, wastage, destruction of assets or other properties;
- (b) there is paralysis of services prejudicial to members’ interest; or
- (c) election of incumbent officers has been declared null and void and the hold-over of the previous Board frustrates or renders nugatory the invalidation.
Management committee members act as agents of the HLURB and are under its control and supervision.
The Board may appoint a committee composed of at least five (5) members, after due notice and hearing, nominated by the parties; if no nomination, the Regional Offices or Board of Commissioners appoint from a list submitted by either party.
Preference is given to members in good standing of the association.
The management committee takes custody and control of all association assets and properties, takes the place of the board of directors, assumes rights and responsibilities, and preserves the association’s assets and properties in its possession.
A majority of committee members must be present to act; the chair is chosen by members from among themselves.
The committee and persons hired by it receive reimbursement of reasonable expenses treated as administrative expenses.
Members and employed persons are immune from suit, claim, or demand for acts/omissions done in good faith in exercise of functions.
Official acts and transactions duly approved or ratified by the Board render members immune from suit related to those acts/transactions.
Within thirty (30) days from appointment, the committee reports to the Board on the association’s condition; thereafter it reports monthly or as the Board requires.
The committee is discharged and dissolved when:
- (a) the Board determines the necessity no longer exists, on motion or motu proprio; or
- (b) upon termination or final disposition of proceedings including election and qualification of a new board.
Upon discharge, the committee submits a final report, renders an accounting, and turns over records and assets to duly qualified officers within a reasonable time allowed by the Regional Office or Board.

Conciliation, position papers, and resolution

Upon receipt of the answer, the Arbiter summons the parties to a conciliation conference to explore amicable settlement.
If parties do not appear personally, representatives or counsel must be authorized by proper special power of attorney or board resolution to enter into settlement.
The conciliation conference must be terminated within sixty (60) days from the date of the initial conference.
Where a party fails or refuses to appear in a scheduled conference, the appearing party may move for termination and submission for resolution under Section 5 of the conciliation rule.
During or around submission, the Arbiter may require ocular inspection of the project/site, examination of owner/developer/corporate records, and presentation of witnesses for clarification or additional information on evidence already in the record.
If settlement is reached, the Arbiter renders judgment based on the compromise agreement duly signed by the parties or duly authorized representatives.
If parties fail to agree, the Arbiter or Executive Committee orders simultaneous filing of respective position papers within thirty (30) days, jointly verified by counsel and parties, attaching affidavits of witnesses and documentary evidence, and including draft decisions per Executive Order No. 26.
Position papers and draft decisions must clearly and distinctly state facts, issues, and applicable laws and jurisprudence.
The Arbiter resolves the case based on pleadings and pertinent records, with or without position papers and draft decisions.

Cease and desist orders and restraining orders

Upon filing a complaint with prayer for a temporary restraining order, the Arbiter may immediately issue a temporary restraining order valid only for twenty (20) days from receipt by the adverse party.
The TRO order must already set the hearing for a cease and desist order within three (3) days from issuance of the TRO, and the Arbiter may authorize personal service by the movant.
A cease and desist order is granted only if:
- (a) the movant is entitled to the relief, consisting in restraining commission or continuance of acts for a limited period or perpetually;
- (b) the act likely works injustice or causes grave and irreparable injury during litigation; or
- (c) the adverse party is doing, threatening, or about to do, or procuring to be done, acts likely violating existing laws and/or Board regulations implemented by this Board, or violating the movant’s rights and tending to render judgment ineffectual.
If granted, the Arbiter requires a bond executed in favor of the party enjoined in an amount determined by the Arbiter or Executive Committee to cover damages the movant may sustain by reason of injunction if finally found not entitled.
A cease and desist order from performing an illegal act is immediately executory, without prejudice to appeal.
The adverse party may elevate the cease and desist order to the Board under Rule XVI; the appeal does not automatically stay enforcement unless the Board orders a stay and a supersedeas bond is posted in an amount twice the bond in the cease and desist order.

Arbiter, Regional Officer, and Board powers

The Arbiter, under the supervision and control of the Regional Officer, may:
- (a) hear and decide, subject to Regional Officer approval, cases cognizable by the Board consistent with the rules;
- (b) issue subpoenas ad testificandum and duces tecum;
- (c) cite and/or declare persons in contempt under Article IV, Section 5 (q), (1) and (2) of Executive Order No. 648 dated 07 February 1981, as amended by Executive Order No. 90 dated 17 December 1986;
- (d) impose fines and/or other penalties for violations of the rules, related regulations, and any HLURB order or decision;
- (e) issue cease and desist orders and temporary restraining orders and similar ancillary writs in accordance with Rule XI;
- (f) suspend or revoke the association’s certificate of registration upon notice and hearing on grounds including:
  - fraud or misrepresentation in procuring its certificate;
  - serious misrepresentation as to what the association can do or is doing;
  - refusal to comply with or defiance of a lawful HLURB or Arbiter order;
  - misuse or contravention of rights, privileges, or franchises;
  - acts amounting to surrender of corporate rights, privilege, or franchise;
  - violations of HLURB rules and regulations and applicable Corporation Code provisions;
  - continuous inoperation or inactivity for at least three (3) years after incorporation;
  - failure to file required reports in appropriate forms within the prescribed period; and
  - failure to file by-laws within thirty (30) days from receipt of notice of issuance of certificate of incorporation;
- (g) place any homeowners association under management committee administration upon proper petition/application after due notice and hearing;
- (h) order and direct production, inspection, examination, investigation, and submission of records, books of accounts, and financial reports of registered homeowners associations; and
- (i) perform other assigned functions.
The Regional Officer may:
- (a) hear and decide contested applications for license, permit, or clearance except cases elevated to the Executive Committee due to significant economic, social, environmental or national policy implications;
- (b) issue subpoenas ad testificandum and duces tecum;
- (c) cite or declare contempt under Article IV, Section 5 (q) (1) and (2) of Executive Order No. 658 dated 07 February 1981, as amended by Executive Order No. 90 dated 17 December 1986;
- (d) hear and resolve motions;
- (e) issue cease and desist orders, TROs, and ancillary writs;
- (f) approve or disapprove recommended orders/decisions of the Arbiter; and
- (g) decide cases if disapproving the Arbiter’s recommended order/decision.
The HLURB has incidental powers to enlist enforcement agencies and to exercise powers implied, necessary, or incidental to its express powers and objectives.

Inhibition and reassignment

The Arbiter and/or Regional Officer must inhibit from adjudicating when:
- (a) they, spouse, child, or relative within the sixth degree of consanguinity or affinity is pecuniarily interested in the subject of litigation;
- (b) they are related to either party or counsel within the sixth degree of consanguinity or affinity; or
- (c) they participated as counsel in the case.
The Arbiter and/or Regional Officer may voluntarily inhibit on just and valid grounds under Rule 137 of the Rules of Court.
A party must file a motion for inhibition stating the grounds and evidence; the Arbiter and/or Regional Officer decides the incident.
If the Arbiter inhibits, the case is assigned by raffle to another Arbiter; absent that, records go to the Director of the Legal Services Group (LSG) for raffle assignment to an Arbiter in LSG.
If the Regional Officer inhibits/disqualifies, records go to LSG for further proceeding and resolution.
If the Director for LSG acts as Arbiter, decision approval is required from the Supervising Commissioner.

Regional offices without an Arbiter

Where a Regional Office has no Arbiter:
- the Regional Officer or authorized legal officer acts as hearing officer to conduct conciliation and issue initial compulsory processes (summons, notices, subpoena);
- when submitted for resolution, the records are transmitted to LSG of the Central Office and Rule XV procedure applies;
- the case is raffled by the Commissioner for Legal Affairs or Group Director to an Arbiter in LSG; the Arbiter signs the decision subject to approval of the Director of LSG; and
- after resolution, records are remanded to the regional office of origin for release and service of the decision.

Decisions, appeal structure, and stays

Arbiter-issued decisions and resolutions, orders, and writs granting provisional remedies require approval of the Regional Officer.
Decisions resolve pending motions and motions filed after submission for resolution within the decision or resolution.
Appeals to the Board are governed by the appeal memorandum rules:
- A party aggrieved by the Regional Officer decision, on legal grounds and upon payment of the appeal fee, must file a verified appeal memorandum in three (3) copies with the Regional Office within thirty (30) days from receipt of the decision.
- In cases decided by the Executive Committee, the verified appeal memorandum is filed through the Board Secretariat to the Executive Committee.
- Mere notice of appeal is not entertained.
- The appellant must furnish the adverse party a copy of the appeal memorandum.
- Within ten (10) days from receipt, the Regional Officer or Executive Committee elevates records to the Board of Commissioners with a summary of proceedings.
- Appeals from Executive Committee decisions are heard by the Board en banc.
The appeal memorandum must state:
- (a) the date the appellant received the decision;
- (b) the grounds relied upon;
- (c) the arguments supporting those grounds; and
- (d) the relief prayed for.
The appeal memorandum must be accompanied by:
- (a) an affidavit of service substantially complying with Supreme Court Circular No. 19-91 and registry return receipt copies indicating the service date;
- (b) a verified certification per Supreme Court Circular No. 28-91, as amended that no similar, related, or other proceeding involving the same subject matter or causes of action has been commenced in any other court or administrative tribunal in the Philippines; and
- (c) in money judgments, an appeal bond satisfactory to the Board equivalent to the amount of the award excluding interests, damages, and attorney’s fees.
The appellee must file a counter-memorandum within an inextendible thirty (30) days from receipt of appellant’s memorandum, with proof of service.
Filing an appeal under these rules automatically stays execution of any decision or order of the Arbiter or Executive Committee unless otherwise provided.

Prohibited pleadings and dismissal of appeals

Reply and rejoinder memoranda are prohibited in appeal proceedings before the Board of Commissioners.
The Board dismisses an appeal for any of the following:
- filing beyond the prescribed period;
- joint motion of the parties;
- withdrawal of the appeal;
- failure to pay appeal fees;
- failure to post an appeal bond required under Section 2 (c) of Rule XVI;
- failure to furnish the other party a copy of the appeal memorandum; or
- failure to comply with Board orders and/or requirements of these rules.

Incidental proceedings, new evidence, and submission timeline

Pending resolution of the appeal, the Board may issue cease and desist orders, special orders to perform, orders of execution pending appeal, or other ancillary writs, motu proprio or on motion.
The Board may order reception of evidence or conduct further proceedings, or take judicial notice of other Board records pursuant to Section 22 of Chapter IV, Book VI of Executive Order No. 292, series of 1987.
Within thirty (30) days from receipt of the adverse party’s counter-memorandum (or upon lapse of appellant’s submission period), parties must simultaneously submit respective draft decisions per Executive Order No. 26, Series of 1992.
The appeal is submitted for resolution with or without a draft decision.
Appeals are resolved by the Board sitting en banc or by division under the Board’s internal rules.

Motions for reconsideration; further appeal

A motion for reconsideration may be filed to the Board only on:
- (a) serious errors of law that would result in grave injustice if not corrected; or
- (b) newly discovered evidence.
Only one (1) motion for reconsideration is entertained.
Motions for reconsideration are assigned to the division that originated the decision/order/ruling.
A party may appeal a Board decision to the Office of the President within fifteen (15) days from receipt of the decision, under P.D. No. 1344 and A.O. No. 18 Series of 1987.
Pendency