Republic of the Philippines

Office of the President

HOUSING AND LAND USE REGULATORY BOARD
Expanded National Capital Region
Corner Kalayaan Avenue and Mayaman Street,
Diliman, Quezon City

RP SHOOTERS GOODHAVEN 3
HOMEOWNERS ASSOCIATION, INC.,
Complainant,

- versus - HLURB Case No. NCRHOA-201

PSF CONSTRUCTION and/or

EMETERIO EUGENIO,
Respondents.
X============================X

DECISION

This is a complaint for breach of contract and damages filed by a homeowners

association against the subdivision owner-developer. Complainant prays as follows:

“WHEREFORE, Premises considered, it is most respectfully prayed of

this Honorable Office that before hearing an Order be issued Ordering the
respondent to cease and desist from his act of taking over by force the
management of the subdivision water facilities and observe terms and conditions
of the Memorandum of Agreement, and after hearing Judgment be rendered
ordering the respondent to permanently cease and desist from meddling with the
affairs of the Homeowners especially with regard to the management and
maintenance of the water facilities and ordering respondent to pay damages and
attorney’s fees.”

The material antecedent facts are not disputed.

The above-named parties entered into an agreement granting to the complainant the
management of the water supply of RP Shooters Goodhaven III Subdivision located at Gulod,
Novaliches, Quezon City.

Aside from the complainant there is also a neighborhood association composed of

residents of the subdivision. The respondents alleged that the existence of two opposing
associations raised the question of which of the two associations should manage the water supply
and decided to take-over the management of the water supply.

Decision HLURB Case No. NCRHOA-201 1

 Presidential Decree No. 902-A otherwise known as: The Securities And Exchange
Commission Reorganization Act (As amended by P.D. Nos. 1799, 1758, 1653, and E. O. No.
285, s. 1994), provide, among other things, as follows:

“SECTION 3. The Commission shall have absolute jurisdiction,

supervision and control over all corporations, partnerships, or associations, who
are grantees of primary franchise and/or a license or permit issued by the
government to operate in the Philippines, and in the exercise of its authority, it
shall have the power to enlist the aid and support of and to deputize any and all
enforcement agencies of the government, civil or military as well as any private
institution, corporation firm, association or person.”

XXX XXX XXX

“SECTION 5. In addition to the regulatory and adjudicative functions of

the Securities and Exchange Commission over corporations, partnerships and
other forms of associations registered with it as expressly granted under existing
laws and decrees, it shall have original and exclusive jurisdiction to hear and
decide cases involving:

a) Devices or schemes employed by or any acts, of the board of directors,

business associates, its officers or partners, amounting to fraud and
misrepresentation which may be detrimental to the interest of the public
and/or the stockholders, partners, members of association or organizations
registered with the Commission;

b) Controversies arising out of intra-corporate or partnership relations, between

and among stockholders, members, or associates; between any and all of
them and the corporation, partnership or association of which they are
stockholders, members or associates, respectively; and between such
corporation, partnership or association and the state insofar as it concerns
their individual franchise or right to exist as such entity;

c) Controversies in the election or appointments of directors, trustees, officers

or managers of such corporations, partnerships or associations;

d) Petitions of corporations, partnerships or associations to be declared in the

state of suspension of payments in cases where the corporation, partnership
or association possesses sufficient property to cover all its debts but foresees
the impossibility of meeting them when they respectively fall due or in cases
where the corporation, partnership or association has no sufficient assets to
cover its liabilities, but is under the management of a Rehabilitation Receiver
or Management Committee created pursuant to this Decree.”

Executive Order No. 535 (Amending the Charter Of the Home Financing Commission,
Renaming It As Home financing Corporation, Enlarging Its Powers, And For Other Purposes),
approved on 03 May 1979, reads in part:

Decision HLURB Case No. NCRHOA-201 2

 “2. In addition to the powers and functions vested under the Home
Financing Act, the Corporation, shall have among others, the following additional
powers;

a) To require submission of and register articles of incorporation of

homeowners association and issue certificates of incorporation/registration,
upon compliance of the registering associations with the duly promulgated
rules and regulations thereon; maintain a registry thereof, and exercise all the
powers, authorities and responsibilities that are vested on the Securities and
Exchange Commission with respect to homeowners association, the provision
of Act 1459, as amended by P.D. 902-A, to the contrary notwithstanding;

b) To regulate and supervise the activities and operations of all

homeowners association registered in accordance therewith;”

The first paragraph of Section 26 of Republic Act No. 8763 (An Act Consolidating and
Amending Republic Act Nos. 580, 1557, 5488, and 7835 and Executive Order Nos. 535 and 90,
As They apply To The Home Insurance And Guaranty Corporation Which Shall Be Renamed As
Home Guaranty Corporation, And For Other Purposes), approved on 29 February 2000, provide
as follows:

“Section 26. Powers Over Homeowners’ Associations. – The powers,

authorities and responsibilities vested in the Corporation with respect to
homeowners’ associations under Republic Act No. 580, as amended by Executive
Order No. 535 is hereby transferred to the Housing and Land Use Regulatory
Board (HLURB).”

Prescinding from the aforementioned statutes the HLURB has the power and authority to:

1. Require submission of and register articles of incorporation of homeowners association and

issue certificates of incorporation/registration, upon compliance of the registering
associations with the duly promulgated rules and regulations thereon; maintain a registry
thereof, and exercise all the powers, authorities and responsibilities that are vested on the
Securities and Exchange Commission with respect to homeowners’ associations.

2. Regulate and supervise the activities and operations of all homeowners’ associations.

It can be gleaned from the afore-quoted laws that the HLURB has original and exclusive
jurisdiction to hear and decide cases involving:

1. Devices or schemes employed by or any acts, of the board of directors, and officers of
homeowners’ associations, amounting to fraud and misrepresentation, which may be
detrimental to the interest of the public and/or the members.

2. Controversies arising out of intra-corporate relations, between and among members; between
any and all of the members and the homeowners’ association; and between the homeowners’
association and the state insofar as it concerns their individual franchise or right to exist as
such entity.

Decision HLURB Case No. NCRHOA-201 3

3. Controversies in the election or appointments of directors, trustees, officers or managers of
homeowners’ associations.

Breach of a contract between a homeowners association and a non-member is not within

the jurisdiction of this Office, it is not included in the above list. The act being complained of
does not belong to any of the aforementioned controversies, hence we have to dismiss the
complaint for lack of jurisdiction.

Wherefore, the foregoing premises considered, judgment is hereby rendered dismissing

the complaint for lack of jurisdiction.

It is so ordered.

Quezon City. 03 July 2007.

Marino Bernardo M. Torres

Housing and Land Use Arbiter

Approved:

JESSE A. OBLIGACION
Regional Director

Decision HLURB Case No. NCRHOA-201 4