G.R. No. 131683 ; June 19, 2000
JESUS LIM ARRANZA, ET AL., AND UNITED BF HOMEOWNERS’ ASSOCIATIONS, INC., petitioners, vs. B.F. HOMES, INC. AND THE HONORABLE COURT OF APPEALS, respondents.

FACTS

Respondent BF Homes, Inc. (BFHI), a subdivision developer, was placed under receivership by the Securities and Exchange Commission (SEC) after filing a petition for rehabilitation. The SEC-appointed Receiver unified various homeowners’ associations into the United BF Homeowners’ Associations, Inc. (UBFHAI) and granted it control over subdivision security, open spaces, and community fund collection for water system improvements. When the SEC later replaced the Receiver with a new Board, this Board revoked UBFHAI’s authority, recognized a different association, and took over the management of subdivision services. Consequently, petitioners, representing homeowners, filed a complaint with the Housing and Land Use Regulatory Board (HLURB) against BFHI and related entities. They sought specific performance regarding basic services and infrastructure, including water supply, security, maintenance of open spaces, and road repairs, alleging BFHI’s failure to comply with its legal obligations as a subdivision developer.

ISSUE

Whether the HLURB or the SEC has jurisdiction over a complaint for specific performance filed by subdivision homeowners against a developer under receivership, concerning the provision of basic subdivision services and amenities.

RULING

The Supreme Court ruled that the HLURB possesses jurisdiction over the complaint. The Court clarified that the SEC’s jurisdiction over a corporation under receivership is limited to matters affecting its preservation, rehabilitation, or liquidation. The homeowners’ complaint, however, pertains to the enforcement of rights and obligations arising from the contract of sale of subdivision lots and BFHI’s statutory duties as a developer under Presidential Decree No. 957 (The Subdivision and Condominium Buyers’ Protective Decree). These issues—such as the provision of water, security, and open spaces—are intrinsically related to the regulation of the real estate trade and the protection of lot buyers, which fall squarely within the HLURB’s specialized expertise and exclusive mandate. The fact that BFHI is under receivership does not divest the HLURB of its jurisdiction over claims that are not directly central to the corporate rehabilitation process itself. The Court emphasized that allowing the HLURB to exercise its jurisdiction would not interfere with the SEC’s control over the corporate assets for rehabilitation purposes, as the HLURB’s orders would ultimately be enforceable against the corporation’s estate under receivership.