G.R. No. 213314 & G.R. No. 214432, March 23, 2021
ALLAN DU YAPHOCKUN, ALFREDO HEBRONA, JR., ROGER C. PARE, GENERAL SANTOS CITY-SARANGANI REAL ESTATE BOARD (GENSANSARREB) AND SOUTH COTABATO REAL ESTATE BOARD (SOCOREB), PETITIONERS, VS. PROFESSIONAL REGULATION COMMISSION (PRC), PROFESSIONAL REGULATORY BOARD OF REAL ESTATE SERVICE (PRBRES), AND PHILIPPINE INSTITUTE OF REAL ESTATE SERVICE PRACTITIONERS, INC. (PHILRES), RESPONDENTS.

[G.R. No. 214432]
PHILIPPINE ASSOCIATION OF REAL ESTATE BOARDS, INC. (PAREB), REAL ESTATE BROKERS ASSOCIATION OF THE PHILIPPINES, INC. (REBAP), NATIONAL REAL ESTATE ASSOCIATION, INC. (NREA), FEDERATION OF REAL ESTATE SERVICE ASSOCIATIONS, INC. (FRESA), AND JOHN WINSTON JIMENEZ, FOR HIMSELF AND AS ATTORNEY-IN-FACT OF OTHER INDIVIDUAL REAL ESTATE SERVICE PRACTITIONERS, PETITIONERS, VS. PROFESSIONAL REGULATION COMMISSION (PRC), PROFESSIONAL REGULATORY BOARD OF REAL ESTATE SERVICE (PRBRES) AND PHILIPPINE INSTITUTE OF REAL ESTATE SERVICE PRACTITIONERS, INC. (PHILRES), RESPONDENTS.

FACTS

Republic Act No. 9646, the Real Estate Service Act (RESA), was enacted to professionalize the real estate service sector. Section 34 of RESA provides for the establishment of an Accredited and Integrated Professional Organization (AIPO), stating: “All real estate service associations shall be integrated into one (1) national organization, which shall be recognized by the Board, subject to the approval of the Commission, as the only accredited and integrated professional organization of real estate service practitioners.” It further states that a registered practitioner shall automatically become a member of the AIPO.
The Professional Regulation Commission (PRC) and the Professional Regulatory Board of Real Estate Service (PRBRES) promulgated the Implementing Rules and Regulations (IRR) of RESA. Section 3(h), Rule I of the IRR defined the AIPO as “the national integrated organization of natural persons duly registered and licensed as Real Estate Service Practitioners.”
Petitioners, consisting of individual practitioners and real estate service associations, challenged the validity of Section 3(h), Rule I of the IRR. They argued that it contravened Section 34 of RESA, which mandates the integration of associations into one national organization, not the integration of individual natural persons. They contended that the IRR provision altered the law’s intent, as supported by the principal author of RESA, former Congressman Rodolfo G. Valencia, who stated the lawmakers envisioned an “umbrella organization” of associations. The PRC, however, maintained its position that the AIPO should be composed of individual practitioners, as RESPs are defined as natural persons under the law.
The PRC accredited the Philippine Institute of Real Estate Service Practitioners, Inc. (PHILRES) as the permanent AIPO. Petitioners filed consolidated petitions for certiorari and prohibition, assailing the IRR provision for being issued with grave abuse of discretion and for being void as it contradicts the statute.

ISSUE

Whether or not public respondents PRC and PRBRES committed grave abuse of discretion amounting to lack or excess of jurisdiction in promulgating Section 3(h), Rule I of the IRR of R.A. No. 9646, which defines the AIPO as an organization of “natural persons,” thereby being contrary to Section 34 of R.A. No. 9646 which directs the integration of “real estate service associations.”

RULING

Yes, the public respondents committed grave abuse of discretion. The Supreme Court granted the petitions and declared Section 3(h), Rule I of the IRR of R.A. No. 9646 NULL and VOID for being contrary to Section 34 of R.A. No. 9646.
The Court ruled that an administrative rule or regulation must conform, not contradict, the provisions of the law it seeks to implement. Section 34 of RESA is clear and unambiguous: it commands the integration of all real estate service associations into one national organization to be recognized as the AIPO. The law uses the term “associations” in the first paragraph and “practitioners” in the second paragraph, indicating a deliberate distinction. The second paragraph, which provides for the automatic membership of individual practitioners in the AIPO, presupposes the prior creation of the AIPO through the integration of associations as mandated in the first paragraph. Therefore, the IRR’s definition limiting the AIPO’s composition to “natural persons” disregards the law’s explicit directive for association-based integration. This constitutes a modification of the law, which is beyond the rule-making power of the PRC and PRBRES. Consequently, the accreditation of PHILRES as the AIPO, which was based on this invalid IRR provision, was also set aside. The Court remanded the matter to the PRC and PRBRES to undertake the integration process in accordance with the correct interpretation of Section 34 of RESA.