Case Digest: XAVIERVILLE III HOMEOWNERS ASSOCIATION, INC. v. XAVIERVILLE II HOMEOWNERS ASSOCIATION, INC.

XAVIERVILLE III HOMEOWNERS ASSOCIATION, INC. v. XAVIERVILLE II HOMEOWNERS ASSOCIATION, INC.

510 SCRA 619 (2006)

Contracting parties may establish such stipulations, clauses, terms and conditions as they may deem convenient, provided they are not contrary to law, morals, good customs, public order, or public policy.

Xavierville II Homeowners Association, Inc. (Xavier II) contended that it is the Housing Land Use Regulatory Board (HLURB) which has jurisdiction over Xavierville III Homeowners Association, Inc. (Xavier III), hence, it filed a motion to dismiss the same. The RTC denied the motion.

The appellate court having denied the association‘s motion for reconsideration and thus, filed this present petition. Now comes the parties‘ ―Joint Manifestation and Motion to Dismiss based on Compromise which prays for the dismissal of the case.

ISSUE:

Whether or not the complaint filed by the petitioner is within the jurisdiction or of the HLURB

HELD:

En passant, the parties’ attention is invited to National Commercial Bank of Saudi Arabia v. Court of Appeals wherein the Court held that under Article 1306 of the Civil Code, contracting parties may establish such stipulations, clauses, terms and conditions as they may deem convenient, provided they are not contrary to law, morals, good customs, public order, or public policy. Thus, a compromise agreement whereby the parties make reciprocal concessions to resolve their differences to thereby put an end to litigation is binding on the contracting parties and is expressly acknowledged as a juridical agreement between them. To have the force of res judicata, however, the compromise agreement must be approved by final order of the court.