Cadungog vs. Jung

A judgment on civil liability incorporated in a criminal decision is void if the source of the obligation is contractual (ex contractu) and the subject matter falls under the exclusive jurisdiction of an administrative agency, such as the HLURB (now HSAC) for disputes between condominium buyers and developers. The civil aspect of such a judgment may be annulled via a Rule 47 petition, notwithstanding the criminal nature of the main case.

Vivien M. Cadungog (petitioner) was the developer of Sophela Tower Condominium. She entered into a Contract to Sell with Sung Ha Jung (respondent) for a unit priced at PHP 3,500,000.00. A dispute arose over the payment of the balance, leading respondent to file a criminal complaint for violation of Presidential Decree No. 957 (the Subdivision and Condominium Buyers' Protective Decree) for failure to deliver the title.

• Nature of the Action: A criminal case for violation of PD 957 was filed against petitioner for allegedly failing to deliver the condominium title to respondent after full payment.
• The Contractual Dispute: The parties entered into a Contract to Sell for a condominium unit at PHP 3,500,000.00. Petitioner claimed a balance of PHP 258,950.00 remained unpaid. Respondent claimed he paid PHP 3,066,050.00 based on a promise of immediate delivery.
• RTC Criminal Judgment: The RTC acquitted petitioner on reasonable doubt. However, it ruled on the civil liability, citing "fairness and equity," and gave respondent the option to require petitioner to either (a) deliver the unit upon payment of the balance, or (b) reimburse the amounts paid with 12% annual interest.
• Execution and Challenge: Respondent chose reimbursement. After execution proceedings commenced, petitioner challenged the civil judgment's validity, arguing the HLURB had exclusive jurisdiction. The RTC denied the challenge, citing finality.

• Jurisdiction: Petitioner argued the RTC had no jurisdiction over the civil aspect because the liability arose from a contract (Contract to Sell), placing it under the exclusive jurisdiction of the HLURB per PD 1344.
• Proper Remedy: Petitioner contended that a Petition for Annulment of Judgment was the proper remedy to assail the void civil aspect of the criminal decision.

• Implied Institution: Respondent countered that the civil action was impliedly instituted with the criminal action under Rule 111, Sec. 1 of the Rules of Criminal Procedure, as he did not waive, reserve, or file it separately.
• Finality and Estoppel: Respondent maintained the RTC judgment was final and executory, and petitioner's failure to appeal through her own fault barred the annulment petition.
• Primary Jurisdiction Exception: Respondent argued that even if HLURB had jurisdiction, the doctrine of primary jurisdiction and exhaustion of administrative remedies did not apply given the case's procedural posture.

• Jurisdiction Over Civil Aspect: Whether the RTC had jurisdiction to adjudicate the civil liabilities of the parties arising from their Contract to Sell within the criminal case.
• Propriety of Annulment: Whether a Petition for Annulment of Judgment under Rule 47 is a proper remedy to challenge the civil aspect of a criminal judgment.

• Jurisdiction Over Civil Aspect: The RTC acted without jurisdiction. The civil liability it adjudged was ex contractu, stemming from the parties' contractual obligations under the Contract to Sell. Pursuant to PD 1344, claims for specific performance or refund filed by a condominium buyer against a developer fall under the exclusive original jurisdiction of the HLURB (now HSAC). The RTC's judgment on this matter was therefore null and void.
• Propriety of Annulment: The Petition for Annulment was proper. Although the case originated from a criminal action, the petition assailed only the civil aspect, which was purely civil in nature. A judgment void for lack of jurisdiction may be attacked at any time, either directly or collaterally. Per Ancheta v. Ancheta, when annulment is grounded on lack of jurisdiction, the petitioner need not allege that ordinary remedies are unavailable through no fault of her own.

• Exclusive Jurisdiction of HLURB/HSAC — Presidential Decree No. 1344 vests the HLURB (now HSAC) with exclusive jurisdiction to hear and decide claims involving refund and specific performance filed by subdivision lot or condominium unit buyers against project owners or developers. This jurisdiction cannot be conferred upon regular courts by the parties' actions or by the incidental nature of the claim within a criminal proceeding.
• Civil Liability Ex Contractu vs. Ex Delicto — When an accused is acquitted on reasonable doubt, civil liability ex delicto may still be recovered in the same criminal case. However, if the source of the obligation is a contract (ex contractu), the civil action is not deemed instituted with the criminal action and must be pursued in the proper forum with jurisdiction (e.g., HLURB).
• Annulment of Void Judgments — A judgment rendered by a court without jurisdiction over the subject matter is void and may be assailed at any time. A petition for annulment under Rule 47 grounded on lack of jurisdiction is not barred by the petitioner's failure to avail of ordinary remedies like appeal.

• "Clearly, the ruling of the RTC pertains to civil liability ex contractu or that which arose from the Contract to Sell entered into between the parties. This is highlighted by the fact that the RTC even gave respondent two options to choose from, the first of which included an obligation on his part to deliver the balance of the purchase price to petitioner..."
• "A judgment rendered or final order issued by the RTC without jurisdiction is null and void and may be assailed any time either collaterally or in a direct action or by resisting such judgment or final order in any action or proceeding whenever it is invoked, unless barred by laches." (Citing Ancheta v. Ancheta)
• "A void judgment never acquires finality... In contemplation of law, that void decision is deemed non-existent. Thus, there was no effective or operative judgment to appeal from." (Citing Nazareno v. Court of Appeals)

• Cheng v. People, 921 Phil. 565 (2022) — Cited for the rule that when an accused is acquitted due to reasonable doubt, civil liability ex delicto may be recovered in the same criminal case, except if the source of the obligation stems from a contract.
• Ancheta v. Ancheta, 468 Phil. 900 (2004) — Controlling precedent holding that a petition for annulment grounded on lack of jurisdiction need not allege that ordinary remedies are unavailable through no fault of the petitioner.
• Nazareno v. Court of Appeals, 428 Phil. 32 (2002) — Cited for the principle that a void judgment never acquires finality and is deemed non-existent.
• Dazon v. Yap, 624 Phil. 76 (2010) — Cited to establish that the HLURB (not regular courts) has jurisdiction over cases involving violations of PD 957 by developers.

• Presidential Decree No. 1344, Section 1 — Empowers the National Housing Authority (now HLURB/HSAC) with exclusive jurisdiction to hear and decide claims involving refund and specific performance filed by subdivision lot or condominium unit buyers against developers.
• Rule 47, Section 1 of the Rules of Court — Governs the annulment by the CA of judgments or final orders in civil actions of the RTC for which ordinary remedies are no longer available.
• Rule 111, Section 1 of the 2000 Rules on Criminal Procedure — Provides that when a criminal action is instituted, the civil action for recovery of civil liability arising from the offense charged is deemed instituted with it, unless waived, reserved, or filed separately.

• J. Caguioa (Chairperson)
• J. Gaerlan
• J. Dimaampao