REM 101 GROUP 3 Dr. Janrey A.

Colmo,MPA,REA,REB, CTT, MRITax,DBA

Christian Vince Laserna-
Researcher/Materials
Leoncio Paladan Marcaida - Presenter
Philip Pagon - Presenter
Sienna Gabia - Presenter
Aldrich Gonzaga Flores - Presenter
Annalyn Pulvinar - Presenter
Christine MD Anua - Presenter
Jose Nacario Alfarez Jr. - Presenter
R.A. 4726
Section 2

A condominium, according to R.A 4726, is an

interest in real property consisting of separate
interest in a unit in a residential, industrial or
commercial building and an undivided interest
in common, directly or indirectly, in the land on
which it is located and in other common areas
of the building.
Section 2
A condominium may include, in addition, a
separate interest in other portions of such real
property. Title to the common areas, including
the land, or the appurtenant interests in such
areas, may be held by a corporation specially
formed for the purpose (hereinafter known as
the "condominium corporation") in which the
holders of separate interest shall automatically
be members or shareholders, to the exclusion
of others, in proportion to the appurtenant
interest of their respective units in the common
areas
Section 3.
(b) A unit means a part of the
condominium project intended for any
type of independent use or ownership,
including one or more rooms or spaces
located in one or more floors (or part or
parts of floors) in a building or
buildings and such accessories as may
be appended thereto.
Section 3.

(c) "Project" means the entire parcel of real

property divided or to be divided in condominiums,
including all structures thereon,
(d) "Common areas" means the entire project
excepting all units separately granted or held or
reserved.
(e) "To divide" real property means to divide the
ownership thereof or other interest therein by
conveying one or more condominiums therein but
less than the whole thereof.
Filipino citizens and corporations can own condominiums. However,
foreigners are restricted to owning no more than 40% of the total and
outstanding capital stock of a corporation. At least 60% should be
Filipino-owned and controlled. In addition to that restriction, foreigners
and foreign corporations are, by law, prohibited to own land.

Filipino citizens and corporations can own condominium

units. Likewise, foreigners are allowed to purchase and
acquire condominium units.
SEC. 4.
The provisions of this Act shall apply
to property divided or to be divided
into condominiums only if there shall
be recorded in the Register of Deeds
of the province or city in which the
property lies and duly annotated in
the corresponding certificate of title
of the land, if the latter had been
patented or registered under either
the Land Registration or Cadastral
Acts
 1. A description of the land including survey plan;
2. A description of the building/s, enclosing technical and diagrammatic plans;
3. A description of common areas and facilities;
4. A statement of the exact nature of the interest acquired or to be acquired by the
purchaser in the separate units and in the common areas of the condominium project.
5. Statement of the purposes for which the building or buildings and each of the units
are intended or restricted as to use;
6. A certificate of the registered owner of the property, if he is other than those executing
the master deed, well as of all registered holders of any lien or encumbrance on the
property, that they consent to the is of the deed;
7. The following plans shall be appended to the deed as integral parts thereof:
(1) A survey plan of the land included in the project, unless a survey plan of the
same property had previously bee filed in said office;
(2) A diagrammatic floor plan of the building or buildings in the project, in sufficient
detail to identify each unit, its relative location and approximate dimensions;

8. Any reasonable restriction not contrary to law, morals or public policy regarding the right
of any condominium owner to alienate or dispose of his condominium
Sec 5.

Any transfer or conveyance of a unit or an apartment, office or

store or other space therein, shall include the transfer or
conveyance of the undivided interests in the common areas
or, in a proper case, the membership or shareholdings in the
condominium corporation:

Provided, however, That where the common areas in the

condominium project are owned by the owners of separate
units as co-owners thereof, no condominium unit herein shall
be conveyed or transferred to persons other than Filipino
citizens, or corporations at least sixty percent of the capital
stock of which belong to Filipino citizens, except in cases of
hereditary succession.
Filipino citizen and corporations
Foreigners, but restricted to
owning no more than 40 percent
of the total outstanding capital
stock of a corporation, which
must be Filipino owned and
controlled.
Can
SecI sell
5. my condominium unit?

Yes. When you sell your unit, however, you are not just
selling the unit itself, you are also selling your interest in
the common areas as well as your membership and
shareholdings in the condominium corporation.

Selling a condominium is restricted by certain

rules under the Condominimum Act, one of
which is the ownership requirement.
Can
Sec the
5. condominium corporation sell the
condominium without my consent?

Generally, yes. However, if the master deed contains a

requirement that the property should first be offered to the other
condominium owners within a reasonable time before offering it
to third parties, then it may not.

Another restriction is one that has been amended to the

Corporation Code by Republic Act No. 7899, which states that, as
an owner, you shall not sell, exchange, lease, or otherwise dispose
of the common areas of a condominium without the approval of
the simple majority of the registered owners, subject as well, to
the approval of the Housing and Land Use Regulatory Board
(HLURB).
Can I freely sell my condominium?
Sec 5.

Not exactly. Selling a unit may be simple, but selling a condominium is restricted
by certain rules under the Condominium Act.

One of such restrictions is the ownership requirement.

For condominiums where the common areas are co-owned by the owners of the
units, the law requires that the purchaser be either a Filipino citizen or corporation
—a corporation that is at least 60 percent owned and controlled by Filipinos.

For condominiums owned by corporations, the sale will be deemed invalid if such
a sale would result in the foreign interest in the corporation exceeding the limits
prescribed by law, which in this case, is 40 percent. In other words, in both cases,
the foreign ownership in the purchasing corporation cannot exceed 40 percent,
otherwise, the sale would be invalid.
 What
Sec 5. forms part of a condominium unit?

Sec 6. The boundary of the unit granted are the interior surfaces of the perimeter walls,
floors, ceilings, windows and doors thereof. The following are not part of the unit bearing
walls, columns, floors, roofs, foundations and other common structural elements of the
building

What do not form part of the condominium unit?

Sec 6. Areas that are not found inside the unit are excluded from the unit. According to the
Condominium Act, “bearing walls, columns, floors, roofs, foundations, and other common
structural elements (e.g., lobbies, stairways, hallways, and other common areas), elevator
equipment and shafts, central heating, central refrigeration, and central air-conditioning
equipment, reservoirs, tanks, pumps, and other central services and facilities, pipes, ducts,
flutes, chutes, conduits, wires, and other utility installations, wherever located.” An
exception to the list are those outlets that are located within the unit.
What
Sec 5. are my rights as a condominium unit owner?

Absolute ownership of your unit

Co-ownership of land and common areas
Exclusive easement of the space of your unit
Non-exclusive easement to common areas for ingress or egress
Right to sell, lease, or mortgage your unit
Right to repair, paint, decorate the interior surface of your unit
Right to participate and vote in condominium corporation
meetings
The5.Condominium Act stipulates that the owners
Sec
can sell the condominium after 50 years. Does that
mean that I will not have any say in the sale?

No, that is not the case. Upon turnover of the unit to you, you become a
member of the corporation that owns the condominium. Hence, your
concurrence or dissent on the matter will count. If, however, it has been
decided that the building shall be sold, then you will be compensated
for your appropriate share from the proceeds of the sale.
 SEC. 9. The owner of a project shall, prior to the conveyance of any
condominium therein, register a declaration of restrictions relating to
such project, which restrictions shall constitute a lien upon each
Sec 5.
condominium in the project, and shall insure to and bind all
condominium owners in the project.

The declaration of restrictions shall provide for the management of the project by
anyone of the following management bodies: a condominium corporation, an
association of the condominium owners, a board of governors elected by
condominium owners, or a management agent elected by the owners or by the
board named in the declaration. It shall also provide for voting majorities quorums,
notices, meeting date, and other rules governing such body or bodies.
Sec 10. Condominium Coporation

Who owns the common areas in a condominium?

Generally, titles to the common areas are held by a corporation formed for
the purpose. However, the condominium law also states that the common
areas are held in common by the unitholders, in equal share for each unit.
Sec 5.
According to Sec 10, Whenever the common areas in a condominium project
are held by a condominium corporation, such corporation shall constitute the
management body of the project.

The articles of incorporation or by-laws of the corporation shall not contain any
provision contrary to or inconsistent with the provisions of this Act, the
enabling or master deed, or the declaration of restrictions of the project.

Membership in a condominium corporation, regardless of whether it is a stock

or non-stock corporation, shall not be transferable separately from the
condominium unit of which it is an appurtenance
1. GENERAL OR UNDIVIDED
Not subject to the exclusive use of any one or group of
owners (swimming pool, hallways, stairways, elevators, et al

2. LIMITED OR DIVIDED
Areas allocated the EXCLUSIVE common areas use of one
or group of unit owners.
Extent of Interest in Common Areas

1. In the absence of any provision in the Master Deed, all

unit owners shall have EQUAL SHARE in the common
areas.

2. The Master Deed may provide any of the following

alternatives:

a. Equal Sharing
b. Sharing based on Value
c. Sharing based on unit area in relation to total area.
Major Documents in a Condominium Project
1. CONDOMINIUM CERTIFICATE OF TITLE (CCT)
is the evidence of ownership of the condominium unit
(compared to the Transfer Certificate of Title for land
ownership)
2. TAX DECLARATION
reference for tax assessment and tax due on the
condominium unit and share in the common areas.
3. CERTIFICATE OF MANAGEMENT
a document issued by the Condominium Corporation
that the conveyance is in accordance with the Master
Deed/Restrictions.
Major Documents in a Condominium Project
4. MASTER DEED
refers to the Enabling Act of any condominium project
This “enables” the condominium to exist and governs its
existence.
5. DEED OF RESTRICTIONS
lays down the provisions for management body,
insurance coverage, maintenance cost & assessment
basis and audit. It indicate the following:
5.1. Management Body
5.2. Provision for Insurance Coverage
5.3. Provision for the maintenance of Common Areas &
Facilities
5.4. Sharing of Realty Tax on Common Areas
Major Documents in a Condominium Project
5.5. Manner of Amending Restrictions
5.6. Independent Audit
5.7. Assessment and Dues
5.8. Project Partitioning & Dissolution of the Condominium
Corporation.
6. ARTICLES OF INCORPORATION
establishes the birth and guidelines of and BY-LAWS
of the condominium corporation.

7. RULES AND REGULATIONS

determines what unit owners and tenants can and
cannot do.
The Need for a Condominium Corporation
1. NECESSITY FOR CREATION
The organization of a Condominium Corporation is
OPTIONAL if no unit will be sold to foreigners.
The corporation is MANDATORY if some units, not to
exceed 40% will be sold to foreigners.

2. PURPOSES OF CORPORATION
To hold title to the land and act as Management Body
3. CONFLICTS WITH MASTER DEED
In case of conflict between the provisions of the Article
The Need for a Condominium Corporation
3. CONFLICTS WITH MASTER DEED
of Incorporation of the condominium corporation and the
Master of Deed, the latter shall prevail based on the following
reasons:

It is the Master Deeds that gives birth to the condominium

project.
The condominium corporation shall not conflict with the
Master Deed.
The Need for a Condominium Corporation
4. TERM OF CORPORATION
The life of the condominium corporation is COTERMINOUS
with the duration of the condominium project.
5. EFFECT OF VOLUNTARY DISSOLUTION
The Corporation shall be deemed to hold the power of
attorney from its stockholders or members to sell their
separate interest in the project.
Liquidation of the Corporation shall be affected by the sale
of the entire project subject to the rights of the corporation
and individual condominium creditors.
The Need for a Condominium Corporation

6. EFFECT OF INVOLUNTARY DISSOLUTION

The common areas held by the corporation shall be

transferred pro-indiviso and in proportion to their interest in
the corporation to the members or stockholders thereof,
subject to the superior rights of the corporation creditors.
The transfer shall be deemed full liquidation of the interest
of the members or stockholders in the corporation.
Dissolution of Condominium Corporation

The condominium corporation may also be dissolved by the

AFFIRMATIVE VOTE of all stock holders or members
thereof at a general or special meeting duly called for the
purpose DISPOSAL, SELL, EXCHANGE OF COMMON
AREAS.
The condominium corporation shall not during its existence,
sell, exchange, lease or otherwise dispose of the common
area owned or held by it, unless authorized by the
AFFIRMATIVE VOTE of SIMPLE MAJORITY of the
registered owners.
Non-Payment of Unit Owner of his Dues

Shall constitute a lien on the title of condominium unit to be

registered with the Register of Deed concerned.

The management body shall have the power to bid at the

foreclosure sale Condominium Corporation.

Membership in the Condominium Corporation, whether

stock or non-stock, shall not be transferable separately from
the condominium unit of which it is an appurtenance.
SEC. 16. A condominium corporation shall not, during its
existence, sell, exchange, lease or otherwise dispose of the
common areas owned or held by it in the condominium
project unless authorized by the affirmative vote of all the
stockholders or members.
 Sec 18
A copy of the description of the land
a brief description of the condominium
conveyed,
Registration of an name and personal circumstances of the
condominium owner
Instrument
Conveying a
Condominium Upon registration of an instrument conveying condominium,
the Register of Deeds shall, upon payment of the proper fees,
enter and annotate the conveyance on the certificate of title
covering the land included within the project and the
transferee shall be entitled to the issuance of a "condominium
owner's" copy of the pertinent portion of such certificate of title.
 Sec 18
In cases of condominium projects registered under the
provisions of the Spanish Mortgage Law or Act 3344, as
amended, the registration of the deed of conveyance of

Registration of an a condominium shall be sufficient if the Register of

Deeds shall keep the original or signed copy thereof,

Instrument together with certificate of the management body of the

project

Conveying a
Condominium a copy of the deed of conveyance will be given to the
condominium owner duly acknowledged and stamped
by the Register of Deeds in the same manner as in the
case of registration of conveyances of real property
under said laws.
 Sec 18
I own a condominium building and want to amend or
revoke the master deed. May I do so without reservation?

No. The Condominium Act states that you can only do this upon the registration of an
instrument (a formal legal document) executed by a simple majority of the registered
owners of the property. In this case, a simple majority could mean either of the two: a
majority based on per-unit ownership or a majority based on the floor area of
ownership.

For condominiums used for either residential or commercial purposes, the former would
apply, while if it is for a mix of both purposes, it is the latter. This requirement also
stipulates that the registered owners must be notified in advance. Evidence of a vote of
a simple majority must also be submitted to the HLURB.
Common
Ownership
of Land
SEC. 20. An assessment upon any condominium made in accordance with a duly
registered declaration of restrictions shall be an obligation of the owner thereof at
the time the assessment is made.

SEC. 21. No labor performed or services or materials furnished with the consent of or
at the request of a condominium owner or his agent or his contractor or
subcontractor shall be the basis of a lien against the condominium of any other
condominium owners unless such other owners have expressly consented to or
requested the performance of such labor or furnishing of such materials services.

SEC. 22. Unless otherwise provided for by the declaration of restrictions, the
management body, provided for herein, may acquire and hold, for the benefit of the
condominium owners, tangible and intangible personal property and may dispose
of the same by sale or otherwise; and the beneficial interest in such personal
property shall owned by the condominium owners in the same proton as their
respective interests in the common areas.
SEC. 23. Where, in an action for partition of a condominium project or for
the dissolution of condominium corporation on the ground that the
project or a material part thereof has been condemned or expropriated,
the Court finds that the conditions provided for in this Act or in
declaration of restrictions have not been met,

the Court may decree a reorganization of the project, declaring which

portion or portions of the project shall continue as a condominium
project,

the owners thereof and the respective rights of said remaining owners
and the just compensation, if any, that a condominium owns may be
entitled to due to deprivation of his property. Upon receipt of a copy of
the decree, the Register Deeds shall enter and annotate the same on
the pertinent certificate of title.
SEC. 24. Any deed, declaration or plan for a condominium project shall
be liberally construed to facilitate the operation of the project, and its
provisions shall be presumed to be independent and severable.

Section 25. Whenever real property has been divided into

condominiums, each condominium separately owned shall be
separately assessed, for purposes of real property taxation and other
tax purposes to the owners thereof and the tax on each such
condominium shall constitute a lien solely thereon.

Section 26. All Acts or parts of Acts in conflict or inconsistent with this
Act are hereby amended insofar as condominium and its incidents are
concerned.

Section 27. This Act shall take effect upon its approval.
What are my obligations as a condominium unit owner?

Pay the realty tax on your condominium unit.

Share the realty tax on the land and common areas.
Pay the insurance on your unit.
Share the insurance on the common areas.
Comply with use restrictions.
Pay dues and assessments.
Give other unit owners the priority right to buy your unit
(right of first refusal) if so required by the master deed.
 REALTY INSTALLMENT
BUYER ACT (MACEDA LAW)
Section 2. It is hereby declared a public policy
to protect buyers of real estate on installment
payments against onerous and oppressive
conditions.
Where the buyer has paid at least two years of installments, the buyer is entitled to the
following rights in case he defaults in the payment of succeeding installments:

Sec 3.
A. To pay, without additional interest, the unpaid installments due within the total grace
period earned by him, which is hereby fixed at the rate of one month grace period for
every one year of installment payments made: Provided ,That this right shall be
exercised by the buyer only once in every five years of the life of the contract and its
extensions, if any.

B. If the contract is cancelled, the seller shall refund to the buyer the cash surrender
value of the payments on the property equivalent to fifty per cent of the payments made
and, after five years of installments an additional five per cent every year but not to
exceed ninety per cent of the total payments made: Provided, That the actual
cancellation of the contract shall take place after thirty days from receipt by the buyer of
the notice of cancellation or the demand for rescission of the contract by a notarial act
and upon full payment of the cash surrender value, to the buyer.
***Down payments, deposits or options on the contract shall be included in
the computation of the total number of installment payments made.
SEC. 4. In case where less than two years of installments
were paid, the seller shall give the buyer a grace period of
not less than sixty days from the date the installment
became due. If the buyer fails to pay the installments due at
the expiration of the grace period, the seller may cancel the
contract after thirty days from receipt by the buyer of the
notice of cancellation or the demand for rescission of the
contract by a notarial act.
 SEC. 5. Under Sections 3 and 4, the buyer shall
have the right to sell his rights or assign the same
to another person or to reinstate the contract by
updating the account during the grace period
and before actual cancellation or the contract.
The deed of sale or assignment shall be done by
notarial act.
 SEC. 6. The buyer shall have the right to pay in
advance any installment or the full unpaid
balance of the purchase price any time without
interest and to have such full payment of the
purchase price annotated in the certificate of title
covering the property.
 Section 7. Any stipulation in any contract
hereafter entered into contrary to the provisions
of Sections 3, 4, 5 and 6, shall be null and void.
Section 8. If any provision of this Act is held
invalid or unconstitutional, no other provision
shall be affected thereby.lawphi1™
Section 9. This Act shall take effect upon its
approval.