Case Digest: THE MANILA BANKING CORPORATION v. SPOUSES ALFREDO AND CELESTINA RABINA, et al.

THE MANILA BANKING CORPORATION v. SPOUSES ALFREDO AND CELESTINA RABINA, et al.

574 SCRA 16 (2008)

The Housing and Land Use Regulatory Board (HLURB) has the power to regulate real estate trade and the same include complaints for annulment f mortgage.

Marenir Development Corporation (MDC), owner/developer of a subdivision project in Quezon City obtained a loan from the Manila Banking Corporation (MBC). To secure the payment of such loan, it forged a real estate mortgage covering real estate properties including the lot which was subject of a Contract to Sell to Amante Sibuyan (Sibuyan). Sibuyan transferred the lot via ―Assignment and Transfer of Rights‖ to Celestina Rabina (Rabina), with the conformity of MDC. The said document mentioned the Contract to Sell which MDC had executed in favor of Sibuyan.

After Rabina had fully paid the amortization payments for the lot, she asked MDC for the transfer to her of its title. MDC, however, failed, prompting Rabina to institute a complaint for non-delivery of titles, annulment of mortgage and incomplete development of the subdivision project Reymarville Subdivision, against MDC before the Office of Appeals, Adjudication and Legal Affairs (OAALA) of the Housing and Land Use Regulatory Board (HLURB). MBC contended that the HLURB has no jurisdiction over it by virtue of Section 29 of Republic Act 265, as amended by Executive Order No. 289.

Housing and Land Use Arbiter Cesar Manuel found in favor of the Rabina and ordered for the payment of moral damages. Upon MBC‘s appeal, the HLURB Board of Commissioners affirmed the Arbiter‘s decision. MBC then elevated the case to the Office of the President (OP) but the same have been dismissed.

On elevation to the Court of Appeals, the appeal was dismissed and the CA affirmed the Orders of the OP. Hence, this petition.

ISSUES:

Whether or not the HLURB has jurisdiction over the case at bar under Presidential Decree 957

HELD:

The act of MDC in mortgaging the lot, without the knowledge and consent of lot Spouses Rabina and without the approval of the HLURB, as required by P.D. 957, is not only an unsound real estate business practice but also highly prejudicial to them.

The jurisdiction of the HLURB to regulate the real estate trade is broad enough to include jurisdiction over complaints for annulment of mortgage. To disassociate the issue of nullity of mortgage and lodge it separately with the liquidation court would only cause inconvenience to the parties and would not serve the ends of speedy and inexpensive administration of justice as mandated by the laws vesting quasi-judicial powers in the agency.

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