G.R. No. 149417 ; June 4, 2004
GLORIA SANTOS DUEÑAS, petitioner, vs. SANTOS SUBDIVISION HOMEOWNERS ASSOCIATION, respondent.

FACTS

Cecilio J. Santos owned and developed the Cecilio J. Santos Subdivision in Valenzuela City, with its plan approved by the Land Registration Commission in 1966. Upon his death in 1988, his daughter, petitioner Gloria Santos Dueñas, inherited the property. In 1997, the respondent Santos Subdivision Homeowners Association (SSHA) requested Dueñas to provide an open space for recreational use within the subdivision, citing Presidential Decree No. 957 (The Subdivision and Condominium Buyers’ Protective Decree). Dueñas rejected the request.
SSHA filed a petition with the Housing and Land Use Regulatory Board (HLURB) to compel Dueñas to provide the open space. The HLURB dismissed the petition, ruling that P.D. No. 957, enacted in 1976, could not be applied retroactively to a subdivision approved a decade earlier. It also found no evidence that Dueñas, as a mere heir, was the developer obligated under the decree, and deemed the action barred by laches. The HLURB Board of Commissioners affirmed. The Court of Appeals reversed, ordering a remand to the HLURB to determine a definitive open space area, applying P.D. No. 957 retroactively based on the police power of the state.

ISSUE

Whether the Court of Appeals erred in applying P.D. No. 957 retroactively to compel petitioner Gloria Santos Dueñas to provide an open space in the subdivision.

RULING

Yes, the Court of Appeals erred. The Supreme Court reversed its decision and reinstated the HLURB’s dismissal of the complaint. The core legal principle is that laws are prospective unless expressly declared retroactive. P.D. No. 957 contains no such express provision for retroactivity. The subdivision plan was approved in 1966, a full ten years before the decree’s enactment. Imposing its open space requirement retroactively would constitute an invalid impairment of vested property rights acquired under the then-existing laws.
The Court clarified that while statutes regulating public health, safety, and morals (police power) can affect existing conditions, they generally do not apply retroactively to invalidate perfected transactions or vested rights. The right of the original owner-developer, Cecilio Santos, to dispose of the subdivision lots was perfected upon the plan’s approval in 1966. Applying P.D. No. 957 to this case would unjustly deprive the heir of property rights that had already vested. Furthermore, petitioner Gloria Santos Dueñas, as a mere heir and not the developer who conducted the subdivision project, cannot be held personally liable for the alleged statutory obligation. The claim, based on an unsubstantiated oral promise of the deceased father, was also correctly found by the HLURB to be barred by laches and the statute of limitations.