G.R. No. 211301, November 27, 2019
Park Developers Incorporated, Reynaldo Jesus B. Pasco, Sr., Rolando Golla, Nenita B. Pasco, Julito Caparas, Teresa Caparas and Constancio Bernardo, Petitioners, vs. Elizabeth D. Daclan, Respondent.

FACTS

On September 24, 2003, respondent Elizabeth D. Daclan purchased a family estate memorial lot from petitioner Park Developers Incorporated (PDI) at Sanctuary Memorial Park in Naic, Cavite, through an “Application for Continual Use,” with a total contract price of P708,000.00 payable in installments. Respondent had paid PDI a total of P457,760.74. In 2005, respondent learned that the Housing and Land Use Regulatory Board (HLURB) had never issued a Certificate of Registration or License to Sell in favor of PDI. Consequently, on January 13, 2006, respondent filed a case for Annulment of Contract with Damages against PDI and its corporate officers (petitioners) before the Regional Trial Court (RTC) of Pasig City, Branch 67. On March 31, 2011, the RTC rendered a decision annulling the agreement and ordering petitioners, jointly and solidarily, to return respondent’s payments with legal interest, and to pay moral damages, exemplary damages, and attorney’s fees. Petitioners appealed to the Court of Appeals (CA), raising the sole issue that the RTC lacked jurisdiction over the subject matter, asserting that primary jurisdiction belonged to the HLURB. On August 12, 2013, the CA dismissed the appeal pursuant to Section 2, Rule 50 of the Rules of Court, ruling that since petitioners raised only a question of law, their proper remedy was a petition for review on certiorari directly to the Supreme Court under Rule 45, not an ordinary appeal to the CA under Rule 41. The CA denied petitioners’ motion for reconsideration.

ISSUE

Whether the Court of Appeals erred in dismissing petitioners’ appeal for raising a pure question of law without first passing judgment on whether the HLURB has primary jurisdiction over the subject matter of the case.

RULING

The Supreme Court ruled that the CA was correct in dismissing petitioners’ appeal pursuant to Section 2, Rule 50 of the Rules of Court, as petitioners raised only a question of law regarding the RTC’s jurisdiction, which should have been brought directly to the Supreme Court via a petition for review on certiorari under Rule 45. However, for the sake of justice and equity, the Court relaxed the procedural rule to resolve the substantive issue. On the merits, the Court held that the HLURB has primary jurisdiction over respondent’s complaint. The HLURB, under its charter and subsequent rules, exercises exclusive original jurisdiction over cases involving subdivisions, condominiums, memorial parks, and similar real estate developments, including claims involving refunds and unsound real estate business practices. Therefore, the complaint for annulment of contract based on the developer’s lack of certificate of registration and license to sell falls within the HLURB’s primary jurisdiction. Nonetheless, the RTC’s judgment remains valid, as the doctrine of primary jurisdiction does not automatically deprive a court of jurisdiction; it merely requires that the court either suspend the judicial process or dismiss the case without prejudice to allow the administrative agency to resolve issues within its special competence. The RTC’s decision was not void for lack of jurisdiction.