Sabig vs. Retirado

A homeowners' association may deprive delinquent, nonpaying members of the right to avail of and enjoy basic community services and facilities, but it may not deprive them of the full right to use common areas such as roads, including for mobile transportation and delivery of basic goods. Applied to Board Resolution Nos. 06-2021 and 001-2017, the bans on deliveries, guest entry, and fetching by empty taxis, tricycles, or Grab vehicles were thus unlawful restrictions on road use under Section 7(a) of Republic Act No. 9904, warranting the directors' permanent disqualification from office.

La Costa Brava Homeowners' Association, Inc. is the homeowners' association of La Costa Brava Subdivision, and Spouses Linley and Juvy Retirado are homeowners and association members therein. Petitioners served as its 2017-2021 directors and officers. Republic Act No. 9904 or the Magna Carta for Homeowners and Homeowners' Associations governs the respective rights of associations and members, including the association's power to sanction members declared delinquent under its bylaws and the members' rights to basic community services and use of common areas.

Spouses Linley and Juvy Retirado are homeowners in La Costa Brava Subdivision, where La Costa Brava Homeowners' Association, Inc. collects monthly association dues. Petitioners Reuben Mikhail P. Sabig, Christopher Siamundo, Ella Salcedo, Katherine Jallorina, Antonio Suganob, Cherrie Mae I, Davelyn Nuqui, Marilyn Gamboa, and Robert Pascua served as the 2017-2021 directors and officers of the association.

From 2016 to 2021, the Spouses Retirado did not pay the monthly dues. Thereafter, petitioners declared them delinquent members and imposed sanctions under Board Resolution Nos. 06-2021 and 001-2017 consisting of (a) banning grass-cutting or maintenance within five meters from the delinquent members' property unless requested in writing by adjacent lot owners, (b) reducing garbage collection to once every two weeks, (c) banning delivery of food, packages, construction materials, appliances, gas and other similar items to delinquent members' residences, (d) banning empty taxis, tricycles or Grab vehicles from entering the subdivision to fetch delinquent members from their residence, (e) banning entry of guests of delinquent members inside the subdivision, and (f) imposing delivery fees on trucks and vehicles delivering supply and materials to construction sites.

Because of the latter group of sanctions, the Spouses Retirado filed a Complaint before the Human Settlements Adjudication Commission against petitioners for violation of Republic Act No. 9904. The Special Adjudicator found the Board Resolutions contrary to law for restricting use and passage through the roads and ordered petitioners permanently disqualified from holding any office in the association, findings affirmed by the HSAC Second Division and En Banc as a violation of Section 7(a) of Republic Act No. 9904. On appeal, the Court of Appeals found no evidence at all of service of the Rule 43 petition on the Spouses Retirado's counsels, only petitioners' claim of service on the spouses themselves supported by a mere photo of a registry receipt.

• Substantial Compliance in Service: Petitioner argued that service of the CA Petition upon the Spouses Retirado themselves constitutes substantial compliance with service requirements.
• Liberal Application of Procedural Rules: Petitioner maintained that procedural rules must be liberally applied because the case has merit.
• Validity of Sanctions under Sections 10(l) and 22(b): Petitioner argued that the subject sanctions are justified under Republic Act No. 9904, since Section 10(l) allows sanctions for violation of rules and Section 22(b) prohibits deprivation of basic community services and facilities only when dues have been paid.
• Boom-Gate Sanction and IRR Section 99(k): Petitioner maintained that the only penalty currently imposed is the refusal of security guards to lift the boom gates, which does not prevent entry and does not violate Section 99(k) of the 2021 Implementing Rules and Regulations of Republic Act No. 9904.
• Permanent Disqualification: Petitioner argued that no serious and grave offense warranting permanent disqualification under the IRR was committed, theorizing that gravity requires an element of corruption absent here.
• Due Process: Petitioner maintained that the HSAC violated due process for failure to point out a specific IRR provision violated.
• Declaration of Default: Petitioner argued that the Special Adjudicator erred in declaring them in default.

• Proper Remedy: Whether the Petition for Certiorari under Rule 65 is the correct remedy to assail the final CA Resolutions.
• Timeliness: Whether the Petition, even if treated as a Petition for Review under Rule 45, was timely filed within the 15-day reglementary period.
• Grave Abuse in Dismissal for Defective Service: Whether the CA committed grave abuse of discretion in dismissing the Rule 43 petition for defective service upon the party instead of counsel.
• Substantial Compliance in Proof of Service: Whether service by registered mail upon the Spouses Retirado themselves, supported by an affidavit and a mere photo of the registry receipt, constitutes substantial compliance.
• Liberal Construction and Validity of Sanctions: Whether liberal application of procedural rules is warranted where the subject road-use sanctions allegedly comply with Republic Act No. 9904.
• Penalty and Ancillary Claims: Whether the violation warrants permanent disqualification, and whether the HSAC violated due process or erred in declaring petitioners in default.

• Proper Remedy: No. Certiorari under Rule 65 was the wrong remedy because appeal by petition for review under Rule 45 was available against the final CA Resolutions, and certiorari cannot substitute for a lapsed appeal.
• Timeliness: No. Even treated as a Rule 45 petition, dismissal was required because filing on December 17, 2024, after receipt on October 18, 2024, exceeded the 15-day reglementary period, rendering the CA Resolutions final.
• Grave Abuse in Dismissal for Defective Service: No. Dismissal was justified because service upon the party and not counsel is defective, leaving the CA with justifiable grounds and no grave abuse of discretion.
• Substantial Compliance in Proof of Service: No. Substantial compliance was not shown because service by registered mail requires both affidavit of service and original registry receipt, and only a photo of the receipt was presented.
• Liberal Construction and Validity of Sanctions: No. Liberality was unwarranted for lack of merit, as the bans on deliveries, guest entry, and fetching vehicles impair delinquents' retained full right to use roads under Section 7(a) of Republic Act No. 9904.
• Penalty and Ancillary Claims: Affirmed. The road-use violation produces great harm and dangerous consequences and is serious and grave warranting permanent disqualification; the due-process and default claims are misleading and moot.

• Proper Remedy: Under Rule 65, certiorari lies only where no appeal is available, and settled jurisprudence provides that where appeal is available, certiorari will not prosper even on grave abuse of discretion grounds. Because the CA Second Resolution denying reconsideration was final, the correct recourse was a petition for review on certiorari under Rule 45, not the Rule 65 Petition filed.
• Timeliness: Treating an erroneously filed Rule 65 petition as the correct Rule 45 petition still requires dismissal if filed beyond the 15-day reglementary period, which must be strictly applied. Receipt of the Second Resolution on October 18, 2024 with filing only on December 17, 2024 plainly showed lapse of the period and an attempt to use certiorari as a substitute for a lapsed appeal.
• Grave Abuse in Dismissal for Defective Service: No grave abuse attends a CA dismissal grounded on justifiable procedural reasons, and service upon the party rather than counsel is settled as defective. With no evidence at all of service on the Spouses Retirado's counsels and only a claim of service on the spouses themselves, dismissal rested on a correct application of service rules.
• Substantial Compliance in Proof of Service: Service by registered mail must be proven by both affidavit of service and registry receipt, with the original receipt required; a mere photocopy or photo lacks assurance of genuineness and even an affidavit alone is insufficient. Petitioners' submission of an affidavit with only a photo of the registry receipt therefore failed to prove service at all, leaving no basis for substantial compliance.
• Liberal Construction and Validity of Sanctions: Liberality requires reasonable explanation for noncompliance, which petitioners did not give for bypassing opposing counsel, and cannot be invoked where the case lacks merit. Under Sections 7(a), 9, 10(l), and 22(b) of Republic Act No. 9904, harmonized by intentional omission and the separate definitions of basic services and common areas including roads, delinquency permits deprivation of basic services such as grass-cutting and garbage collection but preserves the full right to use roads for transportation and delivery of basic goods like food and gas; the subject bans directly restrict that retained right and are not saved by Section 10(l) or the inapplicable Section 22(b).
• Penalty and Ancillary Claims: The offense is serious and grave in its ordinary sense of producing great harm and dangerous consequences by hampering road use for survival goods and mobility, not in the corruption-based administrative sense invoked from inapplicable neglect-of-duty jurisprudence. The due-process claim misstates the record because the HSAC Second Division, as affirmed En Banc, expressly found violation of Section 7(a); the boom-gate-only argument is irrelevant because other sanctions were not shown discontinued and completed liability remains; and the default issue is moot because defenses were raised on appeal as allowed by Section 43 of the HSAC Rules of Procedure.

• Certiorari as extraordinary remedy — Certiorari under Rule 65 is available only when there is no appeal, and it is not a substitute for a lapsed appeal; where appeal under Rule 45 was available against a final resolution, a Rule 65 petition must be dismissed, and even recharacterization as a Rule 45 petition fails if filed beyond the 15-day reglementary period strictly applied to reglementary periods.
• Defective service on party instead of counsel — Service of pleadings upon the party and not counsel is defective and furnishes justifiable ground for dismissal, with no grave abuse of discretion in the appellate court's enforcement of the rule.
• Proof of service by registered mail — Service by registered mail must be proven by both the affidavit of service and the registry receipt, with the original receipt required; a mere photocopy or photo without the original lacks genuineness, raises a presumption of prejudice if produced, and renders even an affidavit insufficient.
• Liberal construction conditioned on merit and explanation — A party invoking liberality must reasonably explain noncompliance, and liberality cannot be granted where the case lacks substantive merit.
• Delinquent members' retained right to common areas under Republic Act No. 9904 — Association members enjoy two separate full rights under Section 7(a): to avail of and enjoy basic community services and facilities, and to use common areas including roads; interpreting Section 22(b) with Section 7(a), delinquency for nonpayment under Sections 9 and 10(l) permits deprivation of the first right but not the second, so road-use bans on deliveries of basic goods, guest entry, and fetching vehicles violate the statute while service-related curtailments such as limited grass-cutting and reduced garbage collection are allowed.
• Statutory construction by intentional omission and harmonization — The omission of the right to use common areas in Section 22(b), contrasted with its inclusion in Section 7(a), is deemed intentional, and provisions must be harmonized to limit the sanctioning power while retaining the delinquent member's full right, understood literally as enjoyment to its utmost extent including mobile transportation and delivery.

• "certiorari is not a substitute for a lapsed appeal." — States the procedural bar applied to reject the Rule 65 Petition where Rule 45 was the available and lapsed remedy.
• "[w]here an appeal is available, certiorari will not prosper, even if the ground therefor is grave abuse of discretion." — Quotes the controlling formulation from Mahinay vs. Court of Appeals, et al. used to hold that the wrong remedy required dismissal.
• "while a homeowners' association may deprive the delinquent association members of their right to avail of or enjoy basic community services and facilities, it may not deprive the members of their right to use common areas, such as the roads." — Articulates the core substantive limitation on sanctioning power under Republic Act No. 9904 that invalidated the subject road-use bans.

• Mahinay vs. Court of Appeals, et al., 576 Phil. 170 (2008) — Followed as controlling on wrong remedy; certiorari does not prosper where appeal is available and recharacterization as Rule 45 still fails if belatedly filed.
• Le Soleil Int'l. Logistics Co., Inc., et al. vs. Sanchez, et al., 769 Phil. 466 (2015) — Followed for strict application of reglementary periods and the requirement of reasonable explanation to invoke liberality.
• Oliveros, et al. vs. Court of Appeals, et al., 885 Phil. 649 (2020) — Followed to hold no grave abuse where the CA had justifiable procedural grounds for dismissal.
• Cervantes vs. City Service Corp., et al., 784 Phil. 694 (2016) — Followed to hold service upon the party and not counsel is defective.
• Mangahas, et al. vs. Court of Appeals, et al., 588 Phil. 61 (2008) — Followed on proof of registered-mail service requiring the original registry receipt, with mere copy insufficient.
• Office of the Ombudsman vs. Delos Reyes, 781 Phil. 297 (2016) — Distinguished as inapplicable gross-neglect administrative precedent invoked to import a corruption element into gravity under the homeowners' association IRR.
• Sps. Delfino vs. St. James Hospital, Inc., 563 Phil. 797 (2007) — Applied as statutory-construction support that omission in Section 22(b) must be considered intentional.
• Philippine International Trading Corp. vs. COA, 635 Phil. 447 (2010) — Applied to require harmonization of statutory provisions in construing Sections 7(a) and 22(b) together.

• Section 7(a), Republic Act No. 9904 — Grants association members full rights to avail of and enjoy basic community services and the use of common areas and facilities; applied to preserve delinquents' full road-use right despite nonpayment.
• Section 3(d) and (f), Republic Act No. 9904 — Separately define basic community services and facilities benefiting all homeowners, including security, street maintenance, and garbage collection, and common areas including roads; applied to separate the two Section 7(a) rights.
• Sections 9 and 10(l), Republic Act No. 9904 — Confer the homeowners' association's right to impose sanctions on members declared delinquent under bylaws; applied but held limited by Sections 7(a) and 22(b).
• Section 22(b), Republic Act No. 9904 — Prohibits depriving a dues-paying homeowner of basic community services and facilities, with corollary deprivation allowed for delinquents; held inapplicable to road-use restrictions because it omits the distinct common-area right.
• Section 99(k) and Section 103, 2021 Implementing Rules and Regulations of Republic Act No. 9904 — Invoked by petitioners to defend the boom-gate practice and contest permanent disqualification; held unavailing because liability for completed road-use violations remained and the violation was serious and grave.
• Rule 65, Section 1 and Rule 45, Rules of Court — Govern certiorari where no appeal lies and review of final CA resolutions within 15 days; applied to dismiss the wrong and belated Petition.
• Rule 13, Section 17(b), Rules of Court — Requires affidavit of service and registry receipt to prove registered-mail service; applied to reject proof by mere photo of receipt.
• Section 43, HSAC Rules of Procedure — Allows raising defenses on appeal; applied to render the default claim moot.

Justices Inting, Gaerlan, Dimaampao and Singh concurred. No separate concurring reasoning of significance appears in the text.