Professional Documents
Culture Documents
RA 4726 and PD 957
RA 4726 and PD 957
957
AN ACT TO DEFINE CONDOMINIUM, ESTABLISH THE SUBDIVISION AND CONDOMINIUM PROTECTIVE
REQUIREMENTS FOR ITS CREATION AND GOVERN ITS BUYER’S DECREE
INCIDENTS
Purpose
Sec. 4 Provisions of this Act shall apply to property P.D. No. 957 was enacted to protect helpless
divided or to be divided into condominium only if a citizens who may fall prey to the manipulations and
Master Deed has been recorded in the Register of machinations of unscrupulous subdivision and
Deeds of the province or city in which the property condominium sellers. (Eugenio v. Drilon, 322 Phil. 112
lies, and duly annotated in the corresponding (1996)). It was issued in the wake of numerous reports
certificate of title of the land, if the latter had beenthat many real estate subdivision owners, developers,
patented or registered under either the Land operators and/or seller have reneged on their
Registration or Cadastral Acts representations and obligations to provide and
Evidence of ownership – In house and lot, evidenced maintain properly subdivision roads, drainage,
by original or transfer certificate of title while in sewerage, water systems, lighting systems, and other
condominium, ownership is evidenced by basic requirements for the health and safety of home
condominium certificate of title (ownership of a and lot buyers. (Casa Filipina Realty Corp. v. Office of
condominium unit issued by the Register of Deeds of the Pres., 311 Phil. 170 (1995).
the city or municipality where the condominium
project is located).
Capacity to buy – In house and lot, or lot only or
townhouse, alien acquisition is not allowed. In the
condominium concept, alien ownership not to exceed
40% interest in the project is legally allowed
Extent of ownership – the interest of the owner in
house and lot consists of absolute ownership of the
inner and outer structures of the building (the entire
building). In the condominium concept, the unit
owner is the absolute owner of the space within the
interior surface of his unit, but is only a co-owner of
the exterior or façade of the unit
Definition of Terms (Sec 3) Sec 2
Condominium project - shall mean the entire parcel of
Condominium – an interest in real property real property divided or to be divided primarily for
consisting of absolute ownership in a unit in a residential purposes into condominium units,
residential, industrial and commercial building and including all structures thereon.
common ownership in the land on which its located Condominium unit- shall mean a part of the
and in common areas of the condominium project. condominium project intended for any type of
Condominium Unit – the space bounded by the independent use or ownership, including one or more
interior surface of those intended for independent rooms or spaces located in one or more floors (or part
use or absolute ownership. of parts of floors) in a building or buildings and such
Common areas – the entire project, such as the land, accessories as may be appended thereto.
building structures, hallways, elevators, stairways, Owner- shall refer to the registered owner of the land
electrical, water and plumbing system, and all subject of a subdivision or a condominium project.
amenities in a condominium project, the exception is Developer- shall mean the person who develops or
the inside of the individual condominium unit. improves the subdivision
Condominium corporation – a non-stock and non- Buy and purchase- shall include any contract to buy,
profit corporation consisting of condominium unit purchase, or otherwise acquire for a valuable
owners which is the management body of the consideration a subdivision lot, including the building
condominium project and owner of its common and other improvements, if any, in a subdivision
areas. This is synonymous in function and nature to project or a condominium unit in a condominium
the homeowners association in subdivisions except project.
that it is taking the form of a corporation. Take note
therefore that it is the reason why a condominium Sec 4 Registration of Projects
unit can be personally owned by possession and title In case registered owner of land wishes to convert
by foreigners but only up to 40% of the total number such land to a condominium project, he/she must
of units of the whole condominium project. register project to the National Housing Authority now
Condominium project – the entire parcel of land HLRUB.
including all the structures thereon.
Master deed – the enabling act which creates the Authority to publish the notice of the filing of the
condominium and contains the description of the registration statement at the expense of the
land, building, common areas facilities use of the applicant-owner or dealer, in 2 newspapers of general
building, declaration of restrictions and plans of the circulation, one published in English and another in
land and buildings and annotated on the certificate of Pilipino, once a week for two consecutive weeks.
title.
Declaration of restrictions – refers to the set of rules, The fact of such registration shall be evidenced by a
procedures, policies and limitations as to the registration certificate to be issued to the applicant-
management and usage of units and common areas owner or dealer.
in a condominium project which constitutes a lien
upon the project and each unit and building upon all Sec 5 After two weeks of obtaining a registration
unit owners, occupants, and others holding any right certificate, the applicant-owner dealer can now apply
or interest in the project, pursuant to the provisions for a license to sell the project, and after payment of
of the Condominium Act and other related laws. performance bond (Sec 6).
Sec. 19. Where the enabling or master deed provides Option to suspend payment or demand for
that the land included within a condominium project reimbursement given to buyer
are to be owned in common by the condominium In case the developer of a subdivision or
owners therein the Register of Deeds may at the condominium fails in its obligation under Section 20 of
request of all the condominium owner and upon P.D. No, 957, Section 23 of the law gives the buyer the
surrender of all their condominium owner’s copies, option to demand reimbursement of the total amount
cancel the certificate of title of the property and issue paid, or to wait for further development of the
a new one in the name of said condominium owners subdivision, and when the buyer opts for the latter
as pro-indiviso co-owners thereof. alternative, he may suspend payment of installments
until such time that the owner or developer had
CONTENTS OF A DECLARATION OF RESTRICTION fulfilled its obligation to him. (Tamayo v. Huang).
1. 1. Formation of the condominium
corporation, the project’s management body. It is thus clear that the law provides two remedies in
2. 2. Procedures and guidelines on maintenance case of incomplete development of the subdivision
of units and common areas. project: (1) reimbursement of the total amount paid,
3. 3. Rules and restrictions on the occupancy including amortization interest but excluding
and usage of units and common areas. delinquency interests, with interest thereon at the
4. 4. Provision for insurance coverage. legal rate; or (2) for the buyer to suspend amortization
5. 5. Realty taxes and assessments on units and payments until the completion of the project. These
common areas. remedies are available to the prospective buyer to
6. 6. Right of assignees, mortgagees, tenants and give effect to the law’s intent to protect the buyers
occupants of the units. from abusive owners/developers of subdivisions. In
7. 7. Provision for assessments and fees. cases of incomplete development, it is the developer
8. 8. Penalty provisions. who is the one at fault, as it would then have violated
9. 9. Procedures in amending restrictions. its promise to the prospective buyers to provide the
necessary facilities in the subdivision. The aggrieved
RIGHTS OF A CONDOMINIUM OWNER (Sec 6) party, therefore, is the prospective buyer because of
1. 1. Absolute ownership of his unit. the non-fulfillment of the developer’s commitment. As
2. 2. Limited ownership of walls, ceilings and such, it is but logical that the option is given to the
floor prospective buyer, not to the developer.
3. 3. Co-ownership of the land and common
areas in proportion to the unit/s owned.
4. 4. Exclusive easement of the air space within
his unit.
5. 5. Non-exclusive easement to common areas
for ingress and egress.
6. 6. Repair, decorate the inner surfaces of his
unit as he pleases.
7. 7. Sell, lease, mortgage his unit.
8. 8. Vote and be voted upon during meetings of
the condominium corporation.
References:
RA 4726
PD 957
RA 7899
Housing and land Use Regulatory Board- /hlrub.gov.ph/
Board of Investments- /boi.gov.ph/
Real Estate Brokers of the Philippines - /rebap.com.ph/
Chamber of Real Estate and Builders Assn. Inc – /creba.ph/