- Ordering the revocation of the Certificate of Registration and License to Sell of the respondent corporation, New San Jose Builders, Inc. (NSJBI);
- Ordering the respondent corporation New San Jose Builders, Inc. (NSJBI) and the individual respondents Rey L. Vergara and Carol B. Ros to immediately cause the release and delivery to herein complainants of the Condominium Certificate of Title No. N-18117 covering Unit 312 of Saint John Condominium, free from all liens and encumbrances;
- Ordering the respondent Government Service Insurance System to release the mortgage on Condominium Certificate of Title No. N-18117 covering Unit 312 of Saint John Condominium;
- Ordering the respondent corporation New San Jose Builders, Inc. (NSJBI) and individual respondents President Rey L. Vergara and AVP for Marketing Carol B. Ros to indemnify the complainants, jointly and severally, the following amounts . . .
x x x x2
. . . an examination of the project's technical docket shows that no mortgage clearance was secured beforehand. Thus, said respondents violated Section 18 of P.D. No. 957 which provides that no mortgage on any unit or lot shall be made by the owner or developer without prior written approval of this Board. This being so, the said mortgage and the incidents which transpired subsequent thereto are void.7 (emphasis and underscoring supplied)
Section 1. It shall be mandatory for government financial institutions, after the lapse of sixty (60) days from the issuance of this Decree, to foreclose the collaterals and/or securities for any loan, credit, accommodation, and/or guarantees granted by them whenever the arrearages on such account, including accrued interest and other charges, amount to at least twenty percent (20%) of the total outstanding obligations, including interest and other charges, as appearing in the books of account and/or related records of the financial institution concerned. This shall be without prejudice to the exercise by the government financial institutions of such rights and/or remedies available to them under their respective contracts with their debtors, including the right to foreclose on loans, credits, accommodations and/or guarantees on which the arrearages are less than twenty percent (20%).
Section 2. No restraining order, temporary or permanent injunction shall be issued by the court against any government financial institution in any action taken by such institution in compliance with the mandatory foreclosure provided in Section 1 hereof, whether such restraining order, temporary or permanent injunction is sought by the borrower(s) or any third party or parties, except after due hearing in which it is established by the borrower and admitted by the government financial institution concerned that twenty percent (20%) of the outstanding arrearages has been paid after the filing of foreclosure proceedings.
In case a restraining order or injunction is issued, the borrower shall nevertheless be legally obligated to liquidate the remaining balance of the arrearages outstanding as of the time of foreclosure, plus interest and other charges, on every succeeding thirtieth (30th) day after the issuance of such restraining order or injunction until the entire arrearages have been liquidated. These shall be in addition to the payment of amortization currently maturing. The restraining order or injunction shall automatically be dissolved should the borrower fail to make any of the above-mentioned payments on due dates, and no restraining order or injunction shall be issued thereafter. This shall be without prejudice to the exercise by the government financial institutions of such rights and/or remedies available to them under their respective charters and their respective contracts with their debtors, nor should this provision be construed as restricting the government financial institutions concerned from approving, solely at its own discretion, any restructuring, recapitalization, or any other arrangement that would place the entire account on a current basis, provided, however, that at least twenty percent (20%) of the arrearages outstanding at the time of the foreclosure is paid.
All restraining orders and injunctions existing as of the date of this Decree on foreclosure proceedings filed by said government financial institutions shall be considered lifted unless finally resolved by the court within sixty (60) days from date hereof. (underscoring supplied)
SECTION 16. Cease and Desist Order. -- Whenever it shall appear to the Authority that any person is engaged or about to engage in any act or practice which constitutes or will constitute a violation of the provisions of this Decree, or of any rule or regulation thereunder, it may, upon due notice and hearing as provided in Section 13 hereof, issue a cease and desist order to enjoin such act or practices.
Endnotes:
1 HLURB records, Vol. 1, pp. 1-16 (documents are paginated in reverse order).
2 Id. at 11-12.
3 Rollo, pp. 55-56.
4 Entitled, "Requiring Government Financial Institutions to Foreclose Mandatorily All Loans with Arrearages, including Interest and Charges amounting to at least Twenty Percent (20%) of the Total Outstanding Obligation."
5 Section 1. It shall be mandatory for government financial institutions, after the lapse of sixty (60) days from the issuance of this Decree, to foreclose the collaterals and/or securities for any loan, credit, accommodation, and/or guarantees granted by them whenever the arrearages on such account, including accrued interest and other charges, amount to at least twenty percent (20%) of the total outstanding obligations, including interest and other charges, as appearing in the books of account and/or related records of the financial institution concerned. This shall be without prejudice to the exercise by the government financial institutions of such rights and/or remedies available to them under their respective contracts with their debtors, including the right to foreclose on loans, credits, accommodations and/or guarantees on which the arrearages are less than twenty percent (20%).
6 Rollo, pp. 74-75.
7 Id. at 95.
8 Reorganizing The Human Settlements Regulatory Commission (Predecessor of The Hlurb), Enacted on February 7, 1981.
9 Penned by Associate Justice Marlene Gonzales-Sison, with the concurrence of Associate Justices Juan Q. Enriquez, Jr. and Vicente S.E. Veloso, rollo pp.136-150.
10 Section 2, Rule XX, 2004 HLURB Revised Rules of Procedure.
11 Realty Exchange Venture Corporation and/or Magdiwang Realty Corporation v. Lucina S. Sendino and the Office of the Executive Secretary, G.R. No. 109703, July 5, 1994, 233 SCRA 665 citing American Tobacco Co. v. Director of Patents, 67 SCRA 287, 292 (1975).
12 Under Section 5(J), Article IV of E.O. No. 648, Series of 1981, as amended by E.O. No. 90, Series of 1986, the recent rules of procedure promulgated by the Board in Resolution No. R-538, Series of 1994, enumerate the composition of the HLURB Board of Commissioners as follows:
"Sec. 1.-- Membership
"The Board of Commissioners shall be composed of the following:
"1. The Chairman, Housing and Urban Development Coordinating Council (HUDCC), as Ex-Officio Chairman;
"2. The Four Full-Time Commissioners;
"3. The Ex-Officio Commissioners referred to in Executive Order 648, representing . . . :
'a. The Department of Justice
'b. The Department of the National Economic and Development Authority;
'c. The Department of Local Government; and
'd. The Department of Public Works and Highways, (1a)'"
13 2004 HLURB Rules of Procedure, Rule XXI, Section 1.
14 Home Bankers Savings & Trust Co. v. Court of Appeals, G.R. No. 128354, April 26, 2005, 457 SCRA 167.