G.R. No. 134269 , G.R. No. 134440 & G.R. No. 144518; July 7, 2010
THE LEARNING CHILD, INC. and SPS. FELIPE AND MARY ANNE ALFONSO, et al., Petitioners, vs. AYALA ALABANG VILLAGE ASSOCIATION, et al., Respondents.

FACTS

The case involves the operation of The Learning Child (TLC) school on a lot within Ayala Alabang Village. The property’s Transfer Certificate of Title contains a Deed of Restrictions, annotated by the original subdivision developer, limiting land use exclusively to a preparatory (nursery and kindergarten) school. The homeowners’ association, Ayala Alabang Village Association (AAVA), acquired the right to enforce these restrictions. TLC began as a preparatory school but later expanded to include a grade school. AAVA and adjacent property owners filed an injunction case before the Regional Trial Court (RTC) of Makati, arguing the expansion violated the Deed of Restrictions and zoning ordinances classifying the area as low-density residential (R-1), which only permits preparatory schools with a maximum of two classrooms.
Simultaneously, a separate zoning controversy arose. The Municipality of Muntinlupa passed a resolution purporting to correct a “typographical error” in its zoning ordinance, reclassifying the subject property and surrounding area from R-1 to “Institutional,” where grade schools are permitted. This reclassification was contested. The RTC in the injunction case ruled in favor of AAVA, ordering TLC to cease its grade school operations and limit its preparatory school to two classrooms. The Court of Appeals affirmed this decision. These petitions consolidated the challenge to that injunction and a related petition concerning the validity of the municipal rezoning resolution.

ISSUE

The core issues are: (1) Whether TLC’s operation of a grade school violates the contractual Deed of Restrictions on the property’s title; and (2) Whether the Muntinlupa Municipal Resolution, which reclassified the property to institutional use, is valid and can override the private contractual restrictions.

RULING

The Supreme Court ruled against TLC and upheld the injunction. On the first issue, the Court affirmed that the Deed of Restrictions is a valid and binding real covenant that runs with the land. As successors-in-interest, the Alfonso spouses and TLC are obligated to comply with the restriction limiting use to a preparatory school only. The expansion to a grade school constitutes a clear breach. The Court emphasized that such private restrictions, established by the subdivision developer for the general benefit of the village, are enforceable by the homeowners’ association and co-exist with zoning laws.
On the second issue, the Court found the municipal rezoning resolution invalid. The change from R-1 (residential) to Institutional was not a mere correction of a clerical error but a substantive amendment that altered land use policy. Such an amendment requires the formal procedures for enacting an ordinance, including public hearings, and cannot be effected through a simple resolution. Therefore, the resolution could not legally reclassify the property or validate TLC’s violation of the private deed. The contractual restriction, being lawful and not contrary to public policy, must be upheld. The Court of Appeals’ decision enjoining the grade school operation was sustained.