Maxima Realty Management and Development Corporation vs. Parkway Real Estate Development Corporation

The period to appeal a decision of the HLURB Board of Commissioners to the Office of the President is fifteen (15) days from receipt thereof, pursuant to Section 15 of PD 957 and Section 2 of PD 1344, and the thirty-day period in Section 27 of the 1994 HLURB Rules of Procedure is inoperative for being inconsistent with the governing special laws.

Petitioner Maxima Realty Management and Development Corporation and respondent Parkway Real Estate Development Corporation entered into an installment sale agreement over Unit #702 of Heart Tower Condominium in Makati City, a unit originally developed by respondent Segovia Development Corporation. The regulatory framework governing disputes involving subdivision and condominium buyers and developers is found in Presidential Decree No. 957 (the Subdivision and Condominium Buyer's Protection Decree) and Presidential Decree No. 1344, which empower the HLURB (formerly the National Housing Authority) to adjudicate such matters and provide for appeals to the Office of the President. The interplay between these special laws and the HLURB's own internal rules of procedure — specifically the 1994 HLURB Rules of Procedure and Administrative Order No. 18 — created the procedural question at the heart of this case.

Unit #702 of Heart Tower Condominium, located along Valero Street, Salcedo Village, Makati City and covered by Condominium Certificate of Title No. 12152, was originally sold by Segovia Development Corporation to Masahiko Morishita, who in turn sold and assigned all his rights to Parkway Real Estate Development Corporation on October 16, 1989. In April 1990, Parkway and petitioner Maxima Realty Management and Development Corporation entered into an installment sale agreement for the unit at a total price of P3,000,000.00, with the stipulation that failure to pay any installment on its due date would entitle Parkway to forfeit amounts paid as liquidated damages.

Maxima defaulted but was granted several grace periods, ultimately paying a total of P1,180,000.00 and leaving a balance of P1,820,000.00. On May 10, 1990, Parkway, with Segovia's consent, executed a Deed of Assignment transferring all its rights in the unit to Maxima, intended to enable Maxima to obtain title in its own name and use the property as security for a P1,820,000.00 loan from Rizal Commercial Banking Corporation, the proceeds of which would satisfy Maxima's outstanding obligation to Parkway. Segovia and Maxima separately agreed that title would be transferred directly to Maxima subject to payment by Maxima of P58,114.00 representing transfer fees, utility expenses, association dues, and miscellaneous charges. RCBC approved Maxima's loan on June 5, 1990, conditioned on submission of the Condominium Certificate of Title in Maxima's name and a Certificate of Completion.

Maxima failed to pay the P58,114.00 to Segovia, so Segovia refused to transfer title. Parkway, not having received the P1,820,000.00 balance, cancelled both the installment sale agreement and the Deed of Assignment. On May 2, 1991, Maxima filed a complaint for specific performance with the HLURB to enforce the buy-and-sell agreement. The HLURB Arbiter, on December 17, 1992, sustained the nullification of the Deed of Assignment and ordered Parkway to refund P1,180,000.00 to Maxima, and directed Segovia to issue title in favor of Parkway upon payment of registration fees. Both parties appealed to the Board of Commissioners. During the pendency of the appeal, Maxima offered to pay the P1,820,000.00 balance, which Parkway accepted, and the Board ordered Maxima to deliver a manager's check and directed Segovia to transfer title to Maxima. Maxima failed to make good its offer, prompting Parkway to file a manifestation seeking resolution of the appeal.

On March 14, 1994, the Board modified the Arbiter's decision, forfeiting 50% of Maxima's total payments in favor of Parkway as damages and penalty, ordering Parkway to refund the remaining balance within thirty days from finality, and directing Segovia to pay Parkway P10,000.00 as attorney's fees. Maxima received a copy of the Board's decision on April 19, 1994, giving it until May 4, 1994 — the fifteenth day — to appeal to the Office of the President. Maxima filed its appeal on May 10, 1994, twenty-one days after receipt. The Office of the President dismissed the appeal as filed out of time, and the Court of Appeals affirmed that dismissal in toto on December 9, 1998.

• Reglementary Period of Appeal: Whether petitioner's appeal before the Office of the President from the decision of the HLURB Board of Commissioners was filed within the reglementary period.

• Reglementary Period of Appeal: No. The appeal was filed out of time, the reglementary period being fifteen (15) days from receipt of the HLURB Board's decision pursuant to Section 15 of PD 957 and Section 2 of PD 1344, not the thirty-day period in Section 27 of the 1994 HLURB Rules of Procedure.

• Reglementary Period of Appeal: The controlling doctrine was established in SGMC Realty Corporation vs. Office of the President, which settled that the period to appeal from the HLURB Board of Commissioners to the Office of the President is fifteen (15) days from receipt of the assailed decision, pursuant to Section 15 of PD 957 and Section 2 of PD 1344. While Section 27 of the 1994 HLURB Rules of Procedure and Administrative Order No. 18, series of 1987, both provide a thirty-day appeal period, those provisions are qualified by the principle that where special laws governing particular cases prescribe a shorter reglementary period, the special-law period prevails. Administrative rules derive their validity from the statute they implement; any rule inconsistent with the enabling statute is null and void. Because PD 957 and PD 1344 — the special laws governing HLURB adjudication of housing and condominium disputes — mandate a fifteen-day period, the thirty-day period in the HLURB Rules of Procedure cannot apply. Applying this rule to the facts, Maxima received the Board's decision on April 19, 1994, and had until May 4, 1994 to appeal. Its appeal filed on May 10, 1994 — twenty-one days later — was clearly beyond the reglementary period, and the Office of the President correctly dismissed it.

• Hierarchy of Legal Sources: Special Laws Prevail over Administrative Rules — Administrative rules and regulations derive their validity from the statute they are intended to implement; any rule inconsistent with the enabling statute is null and void. Where a special law prescribes a specific reglementary period for appeal that differs from the period in an administrative agency's own rules of procedure, the special-law period prevails. The Court applied this doctrine by holding that the fifteen-day appeal period under PD 957 and PD 1344 governs appeals from the HLURB Board of Commissioners to the Office of the President, rendering the thirty-day period in Section 27 of the 1994 HLURB Rules of Procedure inoperative.
• Reglementary Period for HLURB Appeals to the Office of the President — The period to appeal a decision of the HLURB Board of Commissioners to the Office of the President is fifteen (15) days from receipt of the decision, pursuant to Section 15 of PD 957 and Section 2 of PD 1344. This period was applied to determine that Maxima's appeal, filed twenty-one days after receipt, was out of time.

• "If there are special laws governing particular cases which provide for a shorter or longer reglementary period, the same shall prevail over the thirty-day period provided for in the administrative order. This is in line with the rule in statutory construction that an administrative rule or regulation, in order to be valid, must not contradict but conform to the provisions of the enabling law." — This passage, quoted from SGMC Realty Corporation vs. Office of the President, articulates the controlling principle that special laws prescribing appeal periods override conflicting administrative rules, and is the ratio decidendi for the fifteen-day period applied in this case.
• "For it is axiomatic that administrative rules derive their validity from the statute that they are intended to implement. Any rule which is not consistent with [the] statute itself is null and void." — This formulation states the fundamental doctrine on the subordinate status of administrative regulations to their enabling statutes, frequently cited in Philippine administrative law jurisprudence.

• SGMC Realty Corporation vs. Office of the President, G.R. No. 126999, 30 August 2000, 339 SCRA 275 — Controlling precedent directly applied. The Court adopted its ruling that the fifteen-day appeal period under PD 957 and PD 1344 governs appeals from the HLURB Board of Commissioners to the Office of the President, and that the thirty-day period in the 1994 HLURB Rules of Procedure is inapplicable for conflicting with the special laws.

• Section 15, Presidential Decree No. 957 (Subdivision and Condominium Buyer's Protection Decree) — Provides that decisions of the National Housing Authority (now HLURB) shall become final and executory after the lapse of fifteen (15) days from receipt. Applied as one of two special-law bases for the fifteen-day appeal period.
• Section 2, Presidential Decree No. 1344 — Provides that decisions of the National Housing Authority shall become final and executory after fifteen (15) days from receipt and are appealable only to the Office of the President. Applied as the second special-law basis for the fifteen-day appeal period.
• Section 27, 1994 HLURB Rules of Procedure — Provided a thirty-day period to appeal from the Board of Commissioners to the Office of the President. Held inapplicable for being inconsistent with the governing special laws.
• Section 1, Administrative Order No. 18, series of 1987 — Provided a general thirty-day appeal period to the Office of the President, subject to the qualification that special laws prescribing different periods prevail. Construed as yielding to the fifteen-day periods in PD 957 and PD 1344.

Davide, Jr., C.J. (Chairman), Panganiban, Carpio, and Azcuna, JJ., concurred.