G.R. No. 224973 , September 27, 2017
GINA LEFEBRE, JOINED BY HER HUSBAND, DONALD LEFEBRE, PETITIONERS, VS. A BROWN COMPANY, INC., RESPONDENT.

FACTS

Petitioner Gina Lefebre entered into a Contract to Sell with respondent A Brown Company, Inc. for a residential lot in Xavier Estates, partly induced by the developer’s representation that a championship golf course would be developed. Lefebre made substantial payments totaling approximately P8.1 million. The respondent later cancelled the contract due to Lefebre’s alleged failure to pay the remaining balance. Lefebre filed a complaint with the HLURB, arguing the cancellation was invalid and seeking either specific performance for the golf course’s development or a refund, claiming the undeveloped amenity justified her payment delays.
The HLU Arbiter ruled the cancellation was valid due to default but ordered respondent to pay the cash surrender value under RA 6552 (Maceda Law) before effecting cancellation. The HLURB Board of Commissioners (BOC) reversed this, declaring the cancellation invalid for non-compliance with RA 6552’s cash surrender value requirement. It ordered a full refund of payments to Lefebre, minus surcharges, due to the respondent’s abandonment of the golf course project. The respondent directly filed a petition for certiorari with the Court of Appeals, bypassing an appeal to the Office of the President.

ISSUE

The primary issue is whether the Court of Appeals correctly reinstated the HLU Arbiter’s decision, notwithstanding the respondent’s failure to exhaust the administrative remedy of appealing to the Office of the President.

RULING

The Supreme Court granted the petition, reversing the Court of Appeals. The core legal logic centers on the doctrine of exhaustion of administrative remedies. The Court held that decisions of the HLURB BOC are appealable to the Office of the President, not directly to the courts via a petition for certiorari under Rule 65. The respondent’s direct resort to the CA was a fatal procedural flaw. The exceptions to the exhaustion doctrine, such as when the issue is purely legal or when the administrative action is patently illegal, were inapplicable. The case required a review of factual findings—like the validity of the cancellation and the applicability of RA 6552—which fall within the specialized competence of the administrative hierarchy.
Consequently, the CA never acquired jurisdiction over the petition. Its decision reinstating the HLU Arbiter’s ruling was void. The proper course was to dismiss the respondent’s petition for certiorari. The Supreme Court thus reinstated the final and executory decision of the HLURB BOC, which had ordered a refund to the petitioner. The ruling underscores that adherence to the hierarchy of remedies is not a mere technicality but a condition precedent for judicial review, ensuring orderly procedure and respect for administrative expertise.