G.R. No. L-38318 June 29, 1982
AURORA RAYMUNDO, petitioner, vs. PEOPLE’S HOMESITE AND HOUSING CORPORATION, et al., respondents.

FACTS

On December 3, 1964, respondent People’s Homesite and Housing Corporation (PHHC) awarded a residential lot in Quezon City to petitioner Aurora Raymundo, who paid a reservation deposit. The award was subsequently cancelled by PHHC Resolution No. 1132 on June 6, 1968, due to Raymundo’s alleged failure to comply with requirements. Specifically, PHHC contended she failed to submit her 1966 income tax return and a sworn statement regarding lot ownership as required by notices, and that her stated income in her original application was below the minimum required by PHHC rules.
Raymundo filed a complaint for specific performance to compel PHHC to sell her the lot, arguing she had submitted alternative affidavits regarding her income and ownership status, and had offered to pay the full purchase price. The parties submitted the case for decision based on pleadings and a stipulation of facts. The trial court dismissed the complaint, ruling Raymundo failed to comply with her obligations under her application, thus giving her no right to compel PHHC to maintain the award.

ISSUE

Whether the trial court erred in dismissing Raymundo’s complaint for specific performance to compel PHHC to sell her the awarded lot.

RULING

The Supreme Court affirmed the dismissal. The legal logic rests on three key points. First, the transaction between Raymundo and PHHC constituted merely a “Sworn Application to Purchase a Lot,” not a perfected contract of sale or even a contract to sell. Citing Galvez vs. Vda. de Kangleon, the Court emphasized that an application does not create a binding juridical relation that can be enforced by specific performance; it is inherently subject to revocation if the applicant fails to meet qualifications or conditions.
Second, Raymundo’s failure to submit the specifically required 1966 income tax return, despite PHHC’s written demands, constituted a valid violation of the agency’s rules and regulations governing the award. Her submission of alternative affidavits and her offer to pay in full did not cure this defect or obligate PHHC to accept non-compliance. The PHHC was therefore justified in cancelling the award pursuant to its administrative authority.
Third, the Court delineated the proper scope of judicial review over administrative bodies like the PHHC. Absent a clear showing of lack of jurisdiction, grave abuse of discretion, or arbitrary/capricious action amounting to excess of authority, courts will not interfere with purely administrative matters addressed to the sound discretion of such agencies. Raymundo’s action was a direct suit for specific performance, not a special civil action for certiorari or prohibition alleging such abuse. Since no such allegation was substantiated, the PHHC’s administrative action in cancelling the award must stand.