Liwag v. Happy Glen Loop Homeowners Association, Inc.

Facts:

In 1978, F.G.R. Sales, the original developer of Happy Glen Loop, a subdivision in Deparo, Caloocan, obtained a loan from Ernesto Marcelo (Marcelo), the owner of T.P. Marcelo Realty Corporation. To settle its debt after failing to pay its obligation, F.G.R. Sales assigned to Marcelo all its rights over several parcels of land in the Subdivision. Marcelo represented to subdivision lot buyers, NHA and HSRC that a water facility was available in the Subdivision.

For almost 30 years, the residents of the Subdivision relied on this facility as their only source of water. This fact was acknowledged by Marcelo and Hermogenes, petitioners late husband who was then the president of respondent Happy Glen Loop Homeowners Association (Association).

Sometime in September 1995, Marcelo sold Lot 11, Block No. 5 to Hermogenes. As a result, Transfer Certificate of Title No. C-350099 was issued to him. When Hermogenes died in 2003, petitioner Emeteria P. Liwag subsequently wrote a letter to respondent Association, demanding the removal of the overhead water tank from the subject parcel of land.

Refusing to comply with petitioners’ demand, respondent Association filed before the HLURB an action for specific performance; confirmation, maintenance and donation of water facilities; annulment of sale; and cancellation of TCT No. 350099 against T.P. Marcelo Realty Corporation (the owner and developer of the Subdivision), petitioner Emeteria, and the other surviving heirs of Hermogenes.

After the parties submitted their respective position papers, Housing and Land Use Arbiter Melchor ruled in favor of the Association. He invalidated the transfer of the parcel of land in favor of Hermogenes in a Decision dated 5 October 2004.

On appeal before the HLURB Board of Commissioners, the Board found that Lot 11, Block 5 was not an open space. Moreover, it ruled that Marcelo had complied with the requirements of PD 1216 with the donation of 9,047 square meters of open space and road lots. It further stated that there was no proof that Marcelo or the original subdivision owner or developer had at any time represented that Lot 11, Block 5 was an open space. It therefore concluded that the use of the lot as site of the water tank was merely tolerated.

Respondent Association interposed an appeal to the OP, which set aside the Decision of the HLURB Board of Commissioners and affirmed that of the Housing and Land Use Arbiter.

Held:

I
- The HLURB has exclusive jurisdiction over the case at bar

The jurisdiction of the HLURB is outlined in P.D. 1344, Empowering the National Housing Authority to Issue Writ of Execution in the Enforcement of its Decision under Presidential Decree No. 957, viz:

Sec. 1. In the exercise of its functions to regulate real estate trade and business and in addition to its powers provided for in Presidential Decree No. 957, the National Housing Authority shall have the exclusive jurisdiction to hear and decide cases of the following nature.

a.          Unsound real estate business practices;

b.         Claims involving refund and any other claims filed by subdivision lot or condominium unit buyer against the project owner, developer, dealer, broker or salesman; and

c.          Cases involving specific performance of contractual and statutory obligations filed by buyers of subdivision lots or condominium units against the owner, developer, broker or salesman.

When respondent Association filed its Complaint before the HLURB, it alleged that Marcelos sale of Lot 11, Block 5 to Hermogenes was done in violation of P.D. 957 in the following manner:

12. Through fraudulent acts and connivance of [T.P. and Ernesto Marcelo] and the late Liwag and without the knowledge and consent of the complainants all in violation of P.D. 957 and its implementing regulations, respondents T.P. and Ernesto Marcelo transferred the same lot where the deep well is located which is covered by TCT No. C-41785 in favor of spouses Hermogenes Liwag and Emeteria Liwag to the great damage and prejudice of complainants x x x.

II - An easement for water facility exists on Lot 11, Block 5 of Happy Glen Loop Subdivision

Easements or servitudes are encumbrances imposed upon an immovable for the benefit of another immovable belonging to a different owner, for the benefit of a community, or for the benefit of one or more persons to whom the encumbered estate does not belong.

Art. 615. Easements may be continuous or discontinuous, apparent or non-apparent.

Continuous easements are those the use of which is or may be incessant, without the intervention of any act of man.

Discontinuous easements are those which are used at intervals and depend upon the acts of man.

Apparent easements are those which are made known and are continually kept in view by external signs that reveal the use and enjoyment of the same.

Non-apparent easements are those which show no external indication of their existence.

In this case, the water facility is an encumbrance on Lot 11, Block 5 of the Subdivision for the benefit of the community. It is continuous and apparent, because it is used incessantly without human intervention, and because it is continually kept in view by the overhead water tank, which reveals its use to the public.

Contrary to petitioner’s contention that the existence of the water tank on Lot 11, Block 5 is merely tolerated, we find that the easement of water facility has been voluntarily established either by Marcelo, the Subdivision owner and developer; or by F.G.R. Sales, his predecessor-in-interest and the original developer of the Subdivision. For more than 30 years, the facility was continuously used as the residents’ sole source of water. The Civil Code provides that continuous and apparent easements are acquired either by virtue of a title or by prescription of 10 years. It is therefore clear that an easement of water facility has already been acquired through prescription.

III
- Lot 11, Block 5 of Happy Glen Loop Subdivision forms part of its open space

The term open space is defined in P.D. 1216 as an area reserved exclusively for parks, playgrounds, recreational uses, schools, roads, places of worship, hospitals, health centers, barangay centers and other similar facilities and amenities.

The decree makes no specific mention of areas reserved for water facilities. Therefore, we resort to statutory construction to determine whether these areas fall under other similar facilities and amenities.

The basic statutory construction principle of ejusdem generis states that where a general word or phrase follows an enumeration of particular and specific words of the same class, the general word or phrase is to be construed to include or to be restricted to things akin to or resembling, or of the same kind or class as, those specifically mentioned.

Applying this principle to the afore-quoted Section 1 of P.D. 1216, we find that the enumeration refers to areas reserved for the common welfare of the community. Thus, the phrase other similar facilities and amenities should be interpreted in like manner.

Here, the water facility was undoubtedly established for the benefit of the community. Water is a basic need in human settlements, without which the community would not survive. We therefore rule that, based on the principle of ejusdem generis and taking into consideration the intention of the law to create and maintain a healthy environment in human settlements, the location of the water facility in the Subdivision must form part of the area reserved for open space.

IV
- The subject parcel of land is beyond the commerce of man and its sale is prohibited under the law

These open spaces are not susceptible of private ownership and appropriation. We therefore rule that the sale of the subject parcel of land by the subdivision owner or developer to petitioner’s late husband was contrary to law. Hence, we find no reversible error in the appellate courts Decision upholding the HLURB Arbiters annulment of the Deed of Sale.

Petitioner attempts to argue in favor of the validity of the sale of the subject parcel of land by invoking the principle of indefeasibility of title and by arguing that this action constitutes a collateral attack against her title, an act proscribed by the Property Registration Decree.

Petitioner is mistaken on both counts.

First, the rule that a collateral attack against a Torrens title is prohibited by law finds no application to this case.

There is an attack on the title when the object of an action is to nullify a Torrens title, thus challenging the judgment or proceeding pursuant to which the title was decreed. In the present case, this action is not an attack against the validity of the Torrens title, because it does not question the judgment or proceeding that led to the issuance of the title. Rather, this action questions the validity of the transfer of land from Marcelo to petitioner’s husband. As there is no attack direct or collateral against the title, petitioner’s argument holds no water.

Second, the principle of indefeasibility of title is not absolute, and there are well-defined exceptions to this rule. In Aqualab Philippines, Inc. v. Heirs of Pagobo, we ruled that this defense does not extend to a transferee who takes the title with knowledge of a defect in that of the transferees predecessor-in-interest.

In this case, Spouses Liwag were aware of the existence of the easement of water facility when Marcelo sold Lot 11, Block 5 to them. Hermogenes even executed an Affidavit dated 10 August 1982 attesting to the sufficiency of the water supply coming from an electrically operated water pump in the Subdivision. It is undisputed that the water facility in question was their only water source during that time. As residents of the Subdivision, they had even benefited for almost 30 years from its existence. Therefore, petitioner cannot be shielded by the principle of indefeasibility and conclusiveness of title, as she was not an innocent purchaser in good faith and for value.