(The Philippine Star) Updated October 20, 2010 12:00 AM/
If you happen to live or own one of those “Old Families” type compound particularly in Metro Manila, you are well advised to check if the land you are living on is part of what was once called “Friar lands”.
If you are, better do everything in your powers to make sure that your property is safe from land grabbers as well as from possible confiscation by the state due to a “historical” technicality.
If you don’t know what “Friar lands” are, well they are part of large tracts of land that used to belong to “Friars” or the Catholic Church as part of their prize for bringing “the Cross and the Sword” to the pagan world.
Once Spain lost out to the Americans in the Philippines, many “Friar lands” were bought by the colonial government and sold to actual tenants and people residing on said lands, in order to reduce the abusive tenancy practices.
According to recent estimates there are 7,494 titled properties that originated from “Friar lands” which have been passed on from generation to generation or sold to private parties.
But due to an extended three-way legal battle and the subsequent Supreme Court decision on the case, all those titles and the properties they represent may end up going back to the government.
The troublesome case involves a 34-hectare property near the Broadcast City that has evolved into a highly priced real estate boomtown for upscale subdivisions. Fighting over the property are three claimants who have gone through various government offices and various courts all the way to the Supreme Court.
At every step and in every court, the battle was about documentation with each claimant presenting what they purported to be the genuine article. In reading details of the case, one would certainly conclude that the case involving the Manotoks, Barque and Manahans would be fantastic as a case for “Forensic law”.
One group claimed that the Republic of the Philippines issued their documents which another questioned since the Republic of the Philippines, did not exist at the time their documents were issued.
Case details even included how pages from a “Liber Defunctorum” were ripped out purportedly to erase any record of existence of one of the original land owners. In case you never studied Latin, Liber Defunctorum means a “Book of deaths”.
But the most “spectacular” part of this case was that 3 parties went to the Supreme Court praying for the court to decide who is the legal owner of the 34 hectare property. But rather than decide on the petitions, the SC effectively confiscated the property and ordered that the land be returned to the Republic of the Philippines!
From the looks of it, The Supreme Court did so because none of the three claimants had a document that was signed by the Secretary of the Department of Agriculture, which had authority over the matter back then.
The question now is: how many of the 7,494 existing titles fall under the category of being unsigned by the then Secretary of the Department of Agriculture? If the Supreme Court has now opined that, this can be the basis for reverting “Friar lands” to the state, how difficult or impossible would it now be for the government to contest such estates in order to re-sell those estates?
I never took up any law subject so I won’t even opine on the legal issues of the case, but I am personally disturbed that people even thought of the decision as a Solomonic decision. Far from the fact, the court did not order a partition of the property but a confiscation of property based on a technicality.
But if we were to be technical about the matter, was it wise to revert the property back to the government since it was the government that “sold” or transferred ownership of said “Friar lands” into the hands of tenants or residents?
One would imagine that the property could have been placed under guardianship or some form of escrow until such a time when a full legal forensic study of the matter had been completed.
Now that the 34 hectares is on its way back to the Philippine government, who will then get first crack at buying or applying for ownership of the property? Will the confiscation automatically disqualify any of the claimants from “reacquiring” the said property?
Given the many legal and documentary twists and turns of the case, I have no doubt that if the NBI, the Bureau of Lands and the DOJ got into the picture, those who have been misleading or lying to the court would be found out.
I am also concerned by the thought that through the years, three petitioners have used government resources in pursuit of a claim where presumably only one party is telling the truth. So in this case, there is a possibility that at least two parties have dared to commit a blatant fraud before government agencies, the RTC, the Court of Appeals and last but not the least the Supreme Court.
Shall we now turn a blind eye to such fearless fraud and in the same breath commit the greatest injustice by not seeking out the real truth and the deserving party in all of this?
Of collateral interest would be the discoveries that can be made by a full blown investigation regarding reconstitution of titles particularly in Quezon City, cross claims and legal influence peddling by officers of the courts. Yes it is often preferable to be pragmatic than idealistic, but this is Truth and Justice we are talking about — not just land and titles.
Thursday, October 21, 2010
Tuesday, October 12, 2010
SM Prime finishing plans for third Cebu mall, eyeing fourth
CEBU CITY -- SM Prime Holdings, Inc. is accelerating its expansion in Cebu with the construction of a second mall while finalizing plans for a third and scouting for properties for a fourth mall.
SY
SM Prime President Hans T. Sy said “expansion in Cebu is long overdue” as he bared architectural perspectives of the second mall, to be called SM City Consolacion Cebu, at the sidelines of the “Gear and Glam” event here. Mr. Sy said initial investment in the Consolacion mall would be between P750 million and P800 million.
Construction will start before the end of the year, with the mall expected to be completed by the last quarter of 2011.“This signifies our confidence in Cebu. My only regret is we should have done this much earlier,” Mr. Sy said.
The first SM mall here, SM City Cebu, opened almost 17 years ago although an annex was built in 2007. The four-level SM Cebu is currently the fourth-largest SM mall, with an area for lease of nearly 130,000 square meters (sq. m.).
The two-storey Consolacion mall will be an upscale mall with a gross space for lease of about 40,000 sq. m. and gross floor area of about 57,000 sq. m.A long-term lease contract for the 47-hectare project site was signed between SM Prime and lot owner Everjust Realty Development Corp. on Friday.“This will be part of our new design -- new image -- for our malls. It’s going to be upscale,”
Mr. Sy added.The company is also finalizing the design for its third mall that will rise on the 300-hectare South Road Properties (SRP), touted as the new growth center in Cebu. Mr. Sy said he would unveil next month the details of the mall as well as the master development plan for the company’s 30-hectare property at the SRP, which was acquired in January this year from the Cebu city government for P2.7 billion.
In January, he said the company would spend around P20 billion to put up a mall, a couple of condominium buildings, and at least one hotel at the SRP site.
The SRP mall will be bigger than SM Cebu but smaller than the Mall of Asia, currently SM’s biggest.
The company is also looking for a property on which to build its fourth mall in Cebu. One of the prerequisites is that it has to be located within a five-kilometer radius from SM Cebu, Mr. Sy said.
SM Cebu is located at the Cebu north reclamation area, near the port complex and the Mandaue reclamation area.
Meanwhile, an SM Hypermart is expected to open next year as the anchor store of J Mall, a three-hectare shopping center being developed by the Uy family, which also owns fruit processor and exporter Profood International Corp., in Mandaue.SM also operates malls in Iloilo and Bacolod cities.
Nationwide, the company is expected to have 40 malls with a total gross floor area of 4.8 million sq. m. by the end of this year.
Monday, October 4, 2010
Tax on idle land readied
Tuesday, 05 October 2010 00:00
[ manilatimes.net ]
BY JAMES KONSTANTIN GALVEZ REPORTER
THE Aquino administration plans to impose a tax on all idle agricultural properties in a bid to shore up its revenues amid a record budget deficit this year. On the sidelines of the launch of the government’s Food Supply Chain Program, Finance Secretary Cesar Purisima said the idle land tax is mandated in the Local Government Code (LGC) and Agricultural and Fisheries Modernization Act (AFMA), enabling local government units to compel landowners to put their agricultural land to productive use.
The Finance chief said making productive use of idle land would help augment the country’s food supply.
The LGC considers idle land tax as a revenue-raising measure while the AFMA treats it as a form of a penalty for agricultural inactivity.
Under both laws, the municipal treasurer should collect the idle land tax.
The municipality however does not retain the proceeds as these accrue to the general fund of the province as per the LGC mandate, and to the national treasury in the case of AFMA.
Purisima said the idle land tax can augment local government revenues, adding that the tax rate could go as high as 5 percent.
With more local revenues at their disposal, local governments may reduce their dependence on internal revenue allotments, he said.
“It will serve as a means to encourage optimum use of agricultural land,” he also said.
Agriculture Secretary Proceso Alcala said the agency would also push for the idle land taxation to address the 2013 rice self-sufficiency target of the country.
“We have to increase production, and we can do this by forcing these landowners to use these agricultural lands in agriculture purposes,” Alcala said.
He, however, admitted that the legal definition of “idle land” is vague and as a result, the taxes were not collected in the past.
With its top revenue agencies missing their monthly goals, the government has been looking for ways to keep its budget deficit from exceeding the P325-billion ceiling.
Sunday, October 3, 2010
Public Notice (posted at www.architectureboard.ph)
The Professional Regulatory Board of Architecture (PRBoA)
URL/ website: www.architectureboard.ph
_____________________________________________________________________________
PUBLIC NOTICE
as of 12 October 2009
by Electronic Re-Publication
(reposted 30 September 2010 at the PRBoA website)
TO: ALL National Government Agencies (NSAs) and their infrastructure staff, LGUs and their Acting Building Officials Building Officials and Civil Engineers (CEs) who insist on signing and sealing ARCHITECTURAL Plans and Documents (despite the clear provisions under several valid and subsisting laws), Planning/ Design Consultants, Contractors/ Constructors, Developers and Building/ Project Owners, Etc.
_______________________________________________________________________
The Philippine Institute of Civil Engineers (PICE) has published DPWH Memorandum Circular No. 2 signed by DPWH Secretary Hermogenes E. Ebdane, Jr., dated 16 September 2009 and directing all building officials “to process and issue the necessary permits and certificates to all applicants/owners notwithstanding whether the designs/plans and/or other pertinent documents xxx are prepared, signed or sealed by either a registered architect and/or civil engineer” until there is a final and executory decision in the xxx case;
________________________________________________________________________________________________________
Before deciding and attempting to comply with the said 2009 DPWH directive, ALL Public Officials are advised (and warned anew) by the PRBoA to seriously consider the following:
1) R.A. No. 9266 (The Architecture Act of 2004) is a LAW that fully reflects State Policy!
R.A. No. 9266 LIMITS to registered and licensed architects (RLAs) the professional PRIVILEGE of preparing, signing and sealing Architectural Documents.
The 2008 and 2009 DPWH Orders now relied upon by the PICE and its Members (supposedly allowing Civil Engineers/ CEs to sign and seal Architectural documents or the “A” sheets of building plans) are mere Executive Issuances and are therefore NOT LAWS i.e.
Due to their inferior status, executive issuances CANNOT supersede the dictates of State Policies such as R.A. No. 9266.
2) As apparently certified thrice (3x) by two (2) agencies of the National Government (including the National Printing Office that publishes the Official Gazette), the authentic text of Sec. 302 of the 1977 National Building Code of the Philippines (P.D. No. 1096 i.e. another Law) NEVER stated that CEs can prepare, sign or seal Architectural Documents.
3) The CE law R.A. No. 544 of 1950, as amended by R.A. No. 1582 of 1956 apparently does NOT state that CEs can prepare, sign or seal Architectural Document NOR does it state that CEs are also privileged to practice the separate State-regulated profession of Architecture.
To date (more than 60 years later), the said law still apparently lacks a codified set of implementing rules and regulations (IRR).
The CEs are NOT academically nor sub-professionally (apprentice-level) trained to practice Architecture. The CEs have also NOT been tested by the State for their capability to satisfactorily understand architectural concepts and processes, much less undertake architectural services. Their curriculum and licensure examination syllabi/ table of specifications do NOT include the Architectural planning and design of buildings for human habitation or the preparation of Architectural Documents.
4) Only the Professional Regulation Commission (PRC) through its Professional Regulatory Boards (PRBs) have jurisdiction over the 44 State-regulated professions. Thus, only the PRC and the Professional Regulatory Board of Architecture (PRBoA) have EXCLUSIVE JURISDICTION over the practice of the State-regulated profession of Architecture.
Clearly, the DPWH Secretary does NOT have the power to regulate the practice of Architecture in the
In recognition of this State Policy, the AUTHENTIC Sec. 304.5.b. of the 2004 Revised IRR of P.D. No. 1096 (The 1977 NBCP), as promulgated in October 2004 by a former DPWH Secretary states:
“SECTION 304. Issuance of Building Permit xxx
5. Terms and Conditions of Permits xxx
a. xxx
b. This permit shall be accompanied by the various applicable ancillary and accessory permits, plans and specifications signed and sealed by the corresponding design professionals who shall be responsible for the comprehensiveness and correctness of the plans in compliance to the Code and its IRR and to all applicable referral codes and professional regulatory laws.” (underscoring by the PRBoA)
R.A. No. 9266 (The Architecture Act of 2004) is one such professional regulatory LAW (PRL) i.e. the SPECIAL and LATER LAW on the practice of Architecture in the Philippines, that must be complied with in the issuance of the Building Permit by Building Officials nationwide.
The foregoing Sec. 304.5.b of the 2004 Revised IRR of P.D. No. 1096 (The 1977 NBCP) is a valid provision i.e. NO TRO nor injunction, that MUST be fully implemented and enforced by Building Officials nationwide.
5) To date (or more than 6 years after becoming the new Law on the practice of Architecture in the Philippines), there is NO TRO, NO injunction and NO pending constitutional question whatsoever on ANY of the provisions of R.A. No. 9266 (The Architecture Act of 2004) or of its 2004 IRR, particularly the ones that LIMIT to registered and licensed architects (RLAs) the professional PRIVILEGE of preparing, signing and sealing Architectural documents.
R.A. No. 9266 is therefore a valid and subsisting law that MUST be implemented by ALL Government officials, specifically including local government (LGU) officials such as city/ municipal administrators, legal officers, planning officers, treasurers and building officials, under pain of sanctions and administrative/ criminal liability, particularly under its Sec. 29.
6) Similarly, there is apparently NO standing TRO nor injunction on Secs. 302.3 and 302.4 of the 2004 Revised IRR of P.D. No. 1096 (the 1977 NBCP) since early 2008 (with the Court’s lifting/ dissolution of the 2005 injunction secured by the PICE and dismissal of the PICE petition filed against the DPWH Secretary).
Unless the DPWH Secretary expressly amends the said provisions under the 2004 Revised IRR of P.D. No. 1096 (by way of another set of revised IRRs that must be crafted by the DPWH, then be subjected through a properly documented public consultation and national publication), the Secs. 302.3 and 302.4 of the 2004 Revised IRR of P.D. No. 1096 MUST likewise be implemented and enforced by
7) As the 2008 and 2009 DPWH Orders apparently intentionally VIOLATED R.A. No. 9266 (and therefore unduly favored the CEs/ PICE in the course of the violation of said Law), a former DPWH Secretary and 2 of his Undersecretaries were eventually SUED FOR GRAFT at the Office of the Ombudsman by the PRBoA in November 2009.
Also impleaded in the PRBoA Ombudsman complaint were the PICE and the publisher of the intercalated version of Sec. 302 of P.D. No. 1096, purporting (making it appear) that CEs could sign and seal Architectural Documents.
Similar cases are still being readied by the PRBoA for filing in the remaining months of 2010 against the concerned LGU officials, specifically Building Officials who continually refuse or willfully neglect to implement and enforce R.A. No. 9266 (The Architecture Act of 2004) despite sufficient public notices or calls from the PRBoA.
The issue involved is the implementation of Sec. 302.3 & 4 of the 2004 Revised IRR of P.D. No.1096, otherwise known as the 1977
After its publication by the DPWH in April 2005, Sec. 302.3 & 4 of the 2004 Revised IRR of P.D. No.1096 became effective over the period 01 through 24 May 2005 but was subsequently the subject of a writ of preliminary injunction dated 24 May 2005, issued by Manila RTC Branch 22 in Civil Case No. 05-112502 (PICE vs. Ebdane);
This writ of preliminary injunction was later LIFTED/ DISSOLVED by the Court in its Decision on 29 January 2008, and later re-affirmed on 04 May 2009 in a ruling which denied PICE’s 2008 motion for reconsideration; although the Decision is not yet final, Secs. 302. 3 & 4 are already executory by virtue of the lifting of the injunction;
While the foregoing ruling was elevated on appeal to the Court of Appeals, PICE has NOT secured a TRO or injunction against the implementation of Sec. 302.3 & 4 of the 2004 Revised IRR of P.D. No.1096 to date;
The certified text of Sec. 302 of P.D. No.1096 (1977 NBCP) does NOT state that civil engineers (CEs) can sign or seal architectural plans/ documents i.e. perspectives, floor/ ceiling/ roof plans, sections; elevations, detailed architectural drawings, schedules of finishes/ doors/ windows, architectural interior (AI) plans and designs, specifications, and the like for ALL buildings on Philippine soil;
Neither does the CE law R.A. No. 544 of 1956, as amended by R.A. No. 1582 of 1956 provide that civil engineers (CEs) can prepare, sign or seal architectural plans or documents;
On the contrary, R.A. No. 9266, otherwise known as the Architecture Act of 2004, which repealed R.A. No. 545 of 1950, as amended by R.A. No. 1581 of 1956, expressly LIMITS the preparation, signing or sealing of architectural plans/ documents for ANY building on Philippine soil, only to registered and licensed Architects (RLAs); the PICE-published DPWH Memorandum Circular No. 2 cannot supersede, amend nor disregard R.A. No. 9266, a law that has been in full effect since 10 April 2004;
Since there is NO legal impediment in the implementation of R.A. No. 9266 and its IRR after it became effective into law on 10 April 2004, the PICE has NOT acquired any right to publicly sanction the signing nor sealing of architectural plan/ documents for ANY building on Philippine soil by its member-civil engineers;
Under R.A. No. 9266, civil engineers (CEs, even if PRC-registered) are classified as unregistered persons who CANNOT undertake the preparation, signing or sealing of ANY architectural plan/ document for ANY building on Philippine soil; the CEs who insist on doing otherwise may thus be held LIABLE for the ILLEGAL practice of architecture and other violations of R.A. No. 9266;
Unless with the prior official concurrence of the Professional Regulation Commission (PRC) and the Professional Regulatory Boards (PRBs), NO person (not even the DPWH Secretary) has the unbridled right to unilaterally interpret the 2004 Revised IRR of P.D. No. 1096 with respect to State-regulated professional practices and documents, and to mislead the public into believing that civil engineers (CEs) are allowed to sign and seal architectural plans/ documents when the law says otherwise;
The DPWH, through its LGU Building Officials nationwide are therefore under formal advisement to CONTINUE with the implementation and enforcement of Sec. 302.3 & 4 of the 2004 Revised IRR of P.D. No.1096 since the same is consistent with at least 4 national laws i.e. R.A. No. 9266, P.D. No. 1096, R.A. No. 9514 (Fire Code of 2008) and R.A. No. 544/ 1582;
It is therefore the purpose of this publication to make the public AWARE that until such time that the constitutionality or validity of the said laws are properly challenged in the Supreme Court, the unabated practice of allowing civil engineers to sign and seal ANY architectural plan or document must be STOPPED once and for all, and those that may have already been signed and sealed by civil engineers (CEs) from 10 April 2004 to date are consequently of doubtful veracity and may render the concerned buildings as illegally constructed;
In the foregoing situation, the building owners who commissioned the CEs, the constructors and developers who used such plans i.e. architectural plans/ documents signed and sealed by CEs, as well as the LGU officers who approved such documents may be held LIABLE civilly, criminally and administratively; and
In the same vein, National Government and/or LGU officials who approved such documents may first be separately impleaded in administrative and/or special cases that might arise from the flagrant violations of R.A. No. 9266 and of P.D. No. 1096; legal steps in the future shall include the identification and prosecution of the concerned parties who may have conspired to violate R.A. No. 9266 and/or P.D. No. 1096.
Nothing follows.
Broker's professional fees
----- Forwarded Message ----
From: alejandro
To: davaorealtors@yahoogroups.com
Sent: Thursday, September 23, 2010 8:37:06 PM
Subject: [davaorealtors] Broker's professional fees
Dear Co-Realtors:
Here is a decision of the Supreme Court that will be of interest to those in realty profession. Highlights among them are explained using the language of the High Court. Taken from the decision itself, I am retyping very important words and phrases for emphasis:
1. Broker-
A) one who is engaged, for others, on a commission, negotiating contracts, relative to property with the custody of which he has no concern;
B) The negotiator between other parties, never acting in his own name, but in the name of those who employed him;
C) One whose occupation is to bring the parties together, in matters of trade, commerce or navigation.
Difference between a Sales Agent and a Broker
An agent receives a commission upon successful conclusion of sale.
A broker earns his merely by bringing the buyer and seller together, even if no sales is eventually made. In the instant case, it was the herein petitioner that caused the meeting of the buyer, the Sisters of Mary and the Gullas of Cebu as Seller.
D) Take note also how the Supreme Court regarding the amount per Deed of Sale and the Amount per Special Power of Atty issued to the Licensed Real Estate Broker, Manuel B. Tan.
E) There is that "efficient procuring cause, the saving gr ace of Manuel B. Tan and his associates.
The decision of the SC follpws:
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 143978 December 3, 2002
MANUEL B. TAN, GREGG M. TECSON and ALEXANDER SALDAÑA, petitioners,
vs.
EDUARDO R. GULLAS and NORMA S. GULLAS, respondents.
D E C I S I O N
YNARES-SANTIAGO, J.:
This is a petition for review seeking to set aside the decision1 of the Court of Appeals2 in CA-G.R. CV No. 46539, which reversed and set aside the decision3 of the Regional Trial Court of Cebu City, Branch 22 in Civil Case No. CEB-12740.
The records show that private respondents, Spouses Eduardo R. Gullas and Norma S. Gullas, were the registered owners of a parcel of land in the Municipality of Minglanilla, Province of Cebu, measuring 104,114 sq. m., with Transfer Certificate of Title No. 31465.4 On June 29, 1992, they executed a special power of attorney5 authorizing petitioners Manuel B. Tan, a licensed real estate broker,6 and his associates Gregg M. Tecson and Alexander Saldaña, to negotiate for the sale of the land at Five Hundred Fifty Pesos (P550.00) per square meter, at a commission of 3% of the gross price. The power of attorney was non-exclusive and effective for one month from June 29, 1992.7
On the same date, petitioner Tan contacted Engineer Edsel Ledesma, construction manager of the Sisters of Mary of Banneaux, Inc. (hereafter, Sisters of Mary), a religious organization interested in acquiring a property in the Minglanilla area.
In the morning of July 1, 1992, petitioner Tan visited the property with Engineer Ledesma. Thereafter, the two men accompanied Sisters Michaela Kim and Azucena Gaviola, representing the Sisters of Mary, to see private respondent Eduardo Gullas in his office at the University of Visayas. The Sisters, who had already seen and inspected the land, found the same suitable for their purpose and expressed their desire to buy it.8 However, they requested that the selling price be reduced to Five Hundred Thirty Pesos (P530.00) per square meter instead of Five Hundred Fifty Pesos (P550.00) per square meter. Private respondent Eduardo Gullas referred the prospective buyers to his wife.
It was the first time that the buyers came to know that private respondent Eduardo Gullas was the owner of the property. On July 3, 1992, private respondents agreed to sell the property to the Sisters of Mary, and subsequently executed a special power of attorney9 in favor of Eufemia Cañete, giving her the special authority to sell, transfer and convey the land at a fixed price of Two Hundred Pesos (P200.00) per square meter.
On July 17, 1992, attorney-in-fact Eufemia Cañete executed a deed of sale in favor of the Sisters of Mary for the price of Twenty Million Eight Hundred Twenty Two Thousand Eight Hundred Pesos (P20,822.800.00), or at the rate of Two Hundred Pesos (P200.00) per square meter.10 The buyers subsequently paid the corresponding taxes.11 Thereafter, the Register of Deeds of Cebu Province issued TCT No. 75981 in the name of the Sisters of Mary of Banneaux, Inc.12
Earlier, on July 3, 1992, in the afternoon, petitioners went to see private respondent Eduardo Gullas to claim their commission, but the latter told them that he and his wife have already agreed to sell the property to the Sisters of Mary. Private respondents refused to pay the broker's fee and alleged that another group of agents was responsible for the sale of land to the Sisters of Mary.
On August 28, 1992, petitioners filed a complaint13 against the defendants for recovery of their broker's fee in the sum of One Million Six Hundred Fifty Five Thousand Four Hundred Twelve and 60/100 Pesos (P1,655,412.60), as well as moral and exemplary damages and attorney's fees. They alleged that they were the efficient procuring cause in bringing about the sale of the property to the Sisters of Mary, but that their efforts in consummating the sale were frustrated by the private respondents who, in evident bad faith, malice and in order to evade payment of broker's fee, dealt directly with the buyer whom petitioners introduced to them. They further pointed out that the deed of sale was undervalued obviously to evade payment of the correct amount of capital gains tax, documentary stamps and other internal revenue taxes.
In their answer, private respondents countered that, contrary to petitioners' claim, they were not the efficient procuring cause in bringing about the consummation of the sale because another broker, Roberto Pacana, introduced the property to the Sisters of Mary ahead of the petitioners.14 Private respondents maintained that when petitioners introduced the buyers to private respondent Eduardo Gullas, the former were already decided in buying the property through Pacana, who had been paid his commission. Private respondent Eduardo Gullas admitted that petitioners were in his office on July 3, 1992, but only to ask for the reimbursement of their cellular phone expenses.
In their reply and answer to counterclaim,15 petitioners alleged that although the Sisters of Mary knew that the subject land was for sale through various agents, it was petitioners who introduced them to the owners thereof.
After trial, the lower court rendered judgment in favor of petitioners, the dispositive portion of which reads:
WHEREFORE, UPON THE AEGIS OF THE FOREGOING, judgment is hereby rendered for the plaintiffs and against the defendants. By virtue hereof, defendants Eduardo and Norma Gullas are hereby ordered to pay jointly and severally plaintiffs Manuel Tan, Gregg Tecson and Alexander Saldaña;
1) The sum of SIX HUNDRED TWENTY FOUR THOUSAND AND SIX HUNDRED EIGHTY FOUR PESOS (P624,684.00) as broker's fee with legal interest at the rate of 6% per annum from the date of filing of the complaint; and
2) The sum of FIFTY THOUSAND PESOS (P50,000.00) as attorney's fees and costs of litigation.
For lack of merit, defendants' counterclaim is hereby DISMISSED.
IT IS SO ORDERED.16
Both parties appealed to the Court of Appeals. Private respondents argued that the lower court committed errors of fact and law in holding that it was petitioners' efforts which brought about the sale of the property and disregarding the previous negotiations between private respondent Norma Gullas and the Sisters of Mary and Pacana. They further alleged that the lower court had no basis for awarding broker's fee, attorney's fees and the costs of litigation to petitioners.17
Petitioners, for their part, assailed the lower court's basis of the award of broker's fee given to them. They contended that their 3% commission for the sale of the property should be based on the price of P55,180.420.00, or at P530.00 per square meter as agreed upon and not on the alleged actual selling price of P20,822,800.00 or at P200.00 per square meter, since the actual purchase price was undervalued for taxation purposes. They also claimed that the lower court erred in not awarding moral and exemplary damages in spite of its finding of bad faith; and that the amount of P50,000.00 as attorney's fees awarded to them is insufficient. Finally, petitioners argued that the legal interest imposed on their claim should have been pegged at 12% per annum instead of the 6% fixed by the court.18
The Court of Appeals reversed and set aside the lower court's decision and rendered another judgment dismissing the complaint.19
Hence, this appeal.
Petitioners raise following issues for resolution:
I.
THE APPELLATE COURT GROSSLY ERRED IN THEIR FINDING THAT THE PETITIONERS ARE NOT ENTITLED TO THE BROKERAGE COMMISSION.
II.
IN DISMISSING THE COMPLAINT, THE APPELLATE COURT HAS DEPRIVED THE PETITIONERS OF MORAL AND EXEMPLARY DAMAGES, ATTORNEYS' FEES AND INTEREST IN THE FOREBEARANCE OF MONEY.
The petition is impressed with merit.
The records show that petitioner Manuel B. Tan is a licensed real estate broker, and petitioners Gregg M. Tecson and Alexander Saldaña are his associates. In Schmid and Oberly v. RJL Martinez Fishing Corporation,20 we defined a "broker" as "one who is engaged, for others, on a commission, negotiating contracts relative to property with the custody of which he has no concern; the negotiator between other parties, never acting in his own name but in the name of those who employed him. x x x a broker is one whose occupation is to bring the parties together, in matters of trade, commerce or navigation." (Emphasis supplied)
During the trial, it was established that petitioners, as brokers, were authorized by private respondents to negotiate for the sale of their land within a period of one month reckoned from June 29, 1992. The authority given to petitioners was non-exclusive, which meant that private respondents were not precluded from granting the same authority to other agents with respect to the sale of the same property. In fact, private respondent authorized another agent in the person of Mr. Bobby Pacana to sell the same property. There was nothing illegal or amiss in this arrangement, per se, considering the non-exclusivity of petitioners' authority to sell. The problem arose when it eventually turned out that these agents were entertaining one and the same buyer, the Sisters of Mary.
As correctly observed by the trial court, the argument of the private respondents that Pacana was the one entitled to the stipulated 3% commission is untenable, considering that it was the petitioners who were responsible for the introduction of the representatives of the Sisters of Mary to private respondent Eduardo Gullas. Private respondents, however, maintain that they were not aware that their respective agents were negotiating to sell said property to the same buyer.
Private respondents failed to prove their contention that Pacana began negotiations with private respondent Norma Gullas way ahead of petitioners. They failed to present witnesses to substantiate this claim. It is curious that Mrs. Gullas herself was not presented in court to testify about her dealings with Pacana. Neither was Atty. Nachura who was supposedly the one actively negotiating on behalf of the Sisters of Mary, ever presented in court.
Private respondents' contention that Pacana was the one responsible for the sale of the land is also unsubstantiated. There was nothing on record which established the existence of a previous negotiation among Pacana, Mrs. Gullas and the Sisters of Mary. The only piece of evidence that the private respondents were able to present is an undated and unnotarized Special Power of Attorney in favor of Pacana. While the lack of a date and an oath do not necessarily render said Special Power of Attorney invalid, it should be borne in mind that the contract involves a considerable amount of money. Hence, it is inconsistent with sound business practice that the authority to sell is contained in an undated and unnotarized Special Power of Attorney. Petitioners, on the other hand, were given the written authority to sell by the private respondents.
The trial court's evaluation of the witnesses is accorded great respect and finality in the absence of any indication that it overlooked certain facts or circumstances of weight and influence, which if reconsidered, would alter the result of the case.21
Indeed, it is readily apparent that private respondents are trying to evade payment of the commission which rightfully belong to petitioners as brokers with respect to the sale. There was no dispute as to the role that petitioners played in the transaction. At the very least, petitioners set the sale in motion. They were not able to participate in its consummation only because they were prevented from doing so by the acts of the private respondents. In the case of Alfred Hahn v. Court of Appeals and Bayerische Motoren Werke Aktiengesellschaft (BMW)22 we ruled that, "An agent receives a commission upon the successful conclusion of a sale. On the other hand, a broker earns his pay merely by bringing the buyer and the seller together, even if no sale is eventually made." (Underscoring ours). Clearly, therefore, petitioners, as brokers, should be entitled to the commission whether or not the sale of the property subject matter of the contract was concluded through their efforts.
Having ruled that petitioners are entitled to the brokers' commission, we should now resolve how much commission are petitioners entitled to?
Following the stipulation in the Special Power of Attorney, petitioners are entitled to 3% commission for the sale of the land in question. Petitioners maintain that their commission should be based on the price at which the land was offered for sale, i.e., P530.00 per square meter. However, the actual purchase price for which the land was sold was only P200.00 per square meter. Therefore, equity considerations dictate that petitioners' commission must be based on this price. To rule otherwise would constitute unjust enrichment on the part of petitioners as brokers.
In the matter of attorney's fees and expenses of litigation, we affirm the amount of P50,000.00 awarded by the trial court to the petitioners.
WHEREFORE, in view of the foregoing, the petition is GRANTED. The May 29, 2000 decision of the Court of Appeals is REVERSED and SET ASIDE. The decision of the Regional Trial Court of Cebu City, Branch 22, in Civil Case No. CEB-12740 ordering private respondents Eduardo Gullas and Norma S. Gullas to pay jointly and severally petitioners Manuel B. Tan, Gregg Tecson and Alexander Saldaña the sum of Six Hundred Twenty-Four Thousand and Six Hundred Eighty-Four Pesos (P624,684.00) as broker's fee with legal interest at the rate of 6% per annum from the filing of the complaint; and the sum of Fifty Thousand Pesos (P50,000.00) as attorney's fees and costs of litigation, is REINSTATED.
SO ORDERED.
Vitug, and Carpio, JJ., concur.
Davide, Jr., C.J., (Chairman), no part due to close relationship to a party.
Azcuna, J., on official leave.
From: alejandro
To: davaorealtors@yahoogroups.com
Sent: Thursday, September 23, 2010 8:37:06 PM
Subject: [davaorealtors] Broker's professional fees
Dear Co-Realtors:
Here is a decision of the Supreme Court that will be of interest to those in realty profession. Highlights among them are explained using the language of the High Court. Taken from the decision itself, I am retyping very important words and phrases for emphasis:
1. Broker-
A) one who is engaged, for others, on a commission, negotiating contracts, relative to property with the custody of which he has no concern;
B) The negotiator between other parties, never acting in his own name, but in the name of those who employed him;
C) One whose occupation is to bring the parties together, in matters of trade, commerce or navigation.
Difference between a Sales Agent and a Broker
An agent receives a commission upon successful conclusion of sale.
A broker earns his merely by bringing the buyer and seller together, even if no sales is eventually made. In the instant case, it was the herein petitioner that caused the meeting of the buyer, the Sisters of Mary and the Gullas of Cebu as Seller.
D) Take note also how the Supreme Court regarding the amount per Deed of Sale and the Amount per Special Power of Atty issued to the Licensed Real Estate Broker, Manuel B. Tan.
E) There is that "efficient procuring cause, the saving gr ace of Manuel B. Tan and his associates.
The decision of the SC follpws:
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 143978 December 3, 2002
MANUEL B. TAN, GREGG M. TECSON and ALEXANDER SALDAÑA, petitioners,
vs.
EDUARDO R. GULLAS and NORMA S. GULLAS, respondents.
D E C I S I O N
YNARES-SANTIAGO, J.:
This is a petition for review seeking to set aside the decision1 of the Court of Appeals2 in CA-G.R. CV No. 46539, which reversed and set aside the decision3 of the Regional Trial Court of Cebu City, Branch 22 in Civil Case No. CEB-12740.
The records show that private respondents, Spouses Eduardo R. Gullas and Norma S. Gullas, were the registered owners of a parcel of land in the Municipality of Minglanilla, Province of Cebu, measuring 104,114 sq. m., with Transfer Certificate of Title No. 31465.4 On June 29, 1992, they executed a special power of attorney5 authorizing petitioners Manuel B. Tan, a licensed real estate broker,6 and his associates Gregg M. Tecson and Alexander Saldaña, to negotiate for the sale of the land at Five Hundred Fifty Pesos (P550.00) per square meter, at a commission of 3% of the gross price. The power of attorney was non-exclusive and effective for one month from June 29, 1992.7
On the same date, petitioner Tan contacted Engineer Edsel Ledesma, construction manager of the Sisters of Mary of Banneaux, Inc. (hereafter, Sisters of Mary), a religious organization interested in acquiring a property in the Minglanilla area.
In the morning of July 1, 1992, petitioner Tan visited the property with Engineer Ledesma. Thereafter, the two men accompanied Sisters Michaela Kim and Azucena Gaviola, representing the Sisters of Mary, to see private respondent Eduardo Gullas in his office at the University of Visayas. The Sisters, who had already seen and inspected the land, found the same suitable for their purpose and expressed their desire to buy it.8 However, they requested that the selling price be reduced to Five Hundred Thirty Pesos (P530.00) per square meter instead of Five Hundred Fifty Pesos (P550.00) per square meter. Private respondent Eduardo Gullas referred the prospective buyers to his wife.
It was the first time that the buyers came to know that private respondent Eduardo Gullas was the owner of the property. On July 3, 1992, private respondents agreed to sell the property to the Sisters of Mary, and subsequently executed a special power of attorney9 in favor of Eufemia Cañete, giving her the special authority to sell, transfer and convey the land at a fixed price of Two Hundred Pesos (P200.00) per square meter.
On July 17, 1992, attorney-in-fact Eufemia Cañete executed a deed of sale in favor of the Sisters of Mary for the price of Twenty Million Eight Hundred Twenty Two Thousand Eight Hundred Pesos (P20,822.800.00), or at the rate of Two Hundred Pesos (P200.00) per square meter.10 The buyers subsequently paid the corresponding taxes.11 Thereafter, the Register of Deeds of Cebu Province issued TCT No. 75981 in the name of the Sisters of Mary of Banneaux, Inc.12
Earlier, on July 3, 1992, in the afternoon, petitioners went to see private respondent Eduardo Gullas to claim their commission, but the latter told them that he and his wife have already agreed to sell the property to the Sisters of Mary. Private respondents refused to pay the broker's fee and alleged that another group of agents was responsible for the sale of land to the Sisters of Mary.
On August 28, 1992, petitioners filed a complaint13 against the defendants for recovery of their broker's fee in the sum of One Million Six Hundred Fifty Five Thousand Four Hundred Twelve and 60/100 Pesos (P1,655,412.60), as well as moral and exemplary damages and attorney's fees. They alleged that they were the efficient procuring cause in bringing about the sale of the property to the Sisters of Mary, but that their efforts in consummating the sale were frustrated by the private respondents who, in evident bad faith, malice and in order to evade payment of broker's fee, dealt directly with the buyer whom petitioners introduced to them. They further pointed out that the deed of sale was undervalued obviously to evade payment of the correct amount of capital gains tax, documentary stamps and other internal revenue taxes.
In their answer, private respondents countered that, contrary to petitioners' claim, they were not the efficient procuring cause in bringing about the consummation of the sale because another broker, Roberto Pacana, introduced the property to the Sisters of Mary ahead of the petitioners.14 Private respondents maintained that when petitioners introduced the buyers to private respondent Eduardo Gullas, the former were already decided in buying the property through Pacana, who had been paid his commission. Private respondent Eduardo Gullas admitted that petitioners were in his office on July 3, 1992, but only to ask for the reimbursement of their cellular phone expenses.
In their reply and answer to counterclaim,15 petitioners alleged that although the Sisters of Mary knew that the subject land was for sale through various agents, it was petitioners who introduced them to the owners thereof.
After trial, the lower court rendered judgment in favor of petitioners, the dispositive portion of which reads:
WHEREFORE, UPON THE AEGIS OF THE FOREGOING, judgment is hereby rendered for the plaintiffs and against the defendants. By virtue hereof, defendants Eduardo and Norma Gullas are hereby ordered to pay jointly and severally plaintiffs Manuel Tan, Gregg Tecson and Alexander Saldaña;
1) The sum of SIX HUNDRED TWENTY FOUR THOUSAND AND SIX HUNDRED EIGHTY FOUR PESOS (P624,684.00) as broker's fee with legal interest at the rate of 6% per annum from the date of filing of the complaint; and
2) The sum of FIFTY THOUSAND PESOS (P50,000.00) as attorney's fees and costs of litigation.
For lack of merit, defendants' counterclaim is hereby DISMISSED.
IT IS SO ORDERED.16
Both parties appealed to the Court of Appeals. Private respondents argued that the lower court committed errors of fact and law in holding that it was petitioners' efforts which brought about the sale of the property and disregarding the previous negotiations between private respondent Norma Gullas and the Sisters of Mary and Pacana. They further alleged that the lower court had no basis for awarding broker's fee, attorney's fees and the costs of litigation to petitioners.17
Petitioners, for their part, assailed the lower court's basis of the award of broker's fee given to them. They contended that their 3% commission for the sale of the property should be based on the price of P55,180.420.00, or at P530.00 per square meter as agreed upon and not on the alleged actual selling price of P20,822,800.00 or at P200.00 per square meter, since the actual purchase price was undervalued for taxation purposes. They also claimed that the lower court erred in not awarding moral and exemplary damages in spite of its finding of bad faith; and that the amount of P50,000.00 as attorney's fees awarded to them is insufficient. Finally, petitioners argued that the legal interest imposed on their claim should have been pegged at 12% per annum instead of the 6% fixed by the court.18
The Court of Appeals reversed and set aside the lower court's decision and rendered another judgment dismissing the complaint.19
Hence, this appeal.
Petitioners raise following issues for resolution:
I.
THE APPELLATE COURT GROSSLY ERRED IN THEIR FINDING THAT THE PETITIONERS ARE NOT ENTITLED TO THE BROKERAGE COMMISSION.
II.
IN DISMISSING THE COMPLAINT, THE APPELLATE COURT HAS DEPRIVED THE PETITIONERS OF MORAL AND EXEMPLARY DAMAGES, ATTORNEYS' FEES AND INTEREST IN THE FOREBEARANCE OF MONEY.
The petition is impressed with merit.
The records show that petitioner Manuel B. Tan is a licensed real estate broker, and petitioners Gregg M. Tecson and Alexander Saldaña are his associates. In Schmid and Oberly v. RJL Martinez Fishing Corporation,20 we defined a "broker" as "one who is engaged, for others, on a commission, negotiating contracts relative to property with the custody of which he has no concern; the negotiator between other parties, never acting in his own name but in the name of those who employed him. x x x a broker is one whose occupation is to bring the parties together, in matters of trade, commerce or navigation." (Emphasis supplied)
During the trial, it was established that petitioners, as brokers, were authorized by private respondents to negotiate for the sale of their land within a period of one month reckoned from June 29, 1992. The authority given to petitioners was non-exclusive, which meant that private respondents were not precluded from granting the same authority to other agents with respect to the sale of the same property. In fact, private respondent authorized another agent in the person of Mr. Bobby Pacana to sell the same property. There was nothing illegal or amiss in this arrangement, per se, considering the non-exclusivity of petitioners' authority to sell. The problem arose when it eventually turned out that these agents were entertaining one and the same buyer, the Sisters of Mary.
As correctly observed by the trial court, the argument of the private respondents that Pacana was the one entitled to the stipulated 3% commission is untenable, considering that it was the petitioners who were responsible for the introduction of the representatives of the Sisters of Mary to private respondent Eduardo Gullas. Private respondents, however, maintain that they were not aware that their respective agents were negotiating to sell said property to the same buyer.
Private respondents failed to prove their contention that Pacana began negotiations with private respondent Norma Gullas way ahead of petitioners. They failed to present witnesses to substantiate this claim. It is curious that Mrs. Gullas herself was not presented in court to testify about her dealings with Pacana. Neither was Atty. Nachura who was supposedly the one actively negotiating on behalf of the Sisters of Mary, ever presented in court.
Private respondents' contention that Pacana was the one responsible for the sale of the land is also unsubstantiated. There was nothing on record which established the existence of a previous negotiation among Pacana, Mrs. Gullas and the Sisters of Mary. The only piece of evidence that the private respondents were able to present is an undated and unnotarized Special Power of Attorney in favor of Pacana. While the lack of a date and an oath do not necessarily render said Special Power of Attorney invalid, it should be borne in mind that the contract involves a considerable amount of money. Hence, it is inconsistent with sound business practice that the authority to sell is contained in an undated and unnotarized Special Power of Attorney. Petitioners, on the other hand, were given the written authority to sell by the private respondents.
The trial court's evaluation of the witnesses is accorded great respect and finality in the absence of any indication that it overlooked certain facts or circumstances of weight and influence, which if reconsidered, would alter the result of the case.21
Indeed, it is readily apparent that private respondents are trying to evade payment of the commission which rightfully belong to petitioners as brokers with respect to the sale. There was no dispute as to the role that petitioners played in the transaction. At the very least, petitioners set the sale in motion. They were not able to participate in its consummation only because they were prevented from doing so by the acts of the private respondents. In the case of Alfred Hahn v. Court of Appeals and Bayerische Motoren Werke Aktiengesellschaft (BMW)22 we ruled that, "An agent receives a commission upon the successful conclusion of a sale. On the other hand, a broker earns his pay merely by bringing the buyer and the seller together, even if no sale is eventually made." (Underscoring ours). Clearly, therefore, petitioners, as brokers, should be entitled to the commission whether or not the sale of the property subject matter of the contract was concluded through their efforts.
Having ruled that petitioners are entitled to the brokers' commission, we should now resolve how much commission are petitioners entitled to?
Following the stipulation in the Special Power of Attorney, petitioners are entitled to 3% commission for the sale of the land in question. Petitioners maintain that their commission should be based on the price at which the land was offered for sale, i.e., P530.00 per square meter. However, the actual purchase price for which the land was sold was only P200.00 per square meter. Therefore, equity considerations dictate that petitioners' commission must be based on this price. To rule otherwise would constitute unjust enrichment on the part of petitioners as brokers.
In the matter of attorney's fees and expenses of litigation, we affirm the amount of P50,000.00 awarded by the trial court to the petitioners.
WHEREFORE, in view of the foregoing, the petition is GRANTED. The May 29, 2000 decision of the Court of Appeals is REVERSED and SET ASIDE. The decision of the Regional Trial Court of Cebu City, Branch 22, in Civil Case No. CEB-12740 ordering private respondents Eduardo Gullas and Norma S. Gullas to pay jointly and severally petitioners Manuel B. Tan, Gregg Tecson and Alexander Saldaña the sum of Six Hundred Twenty-Four Thousand and Six Hundred Eighty-Four Pesos (P624,684.00) as broker's fee with legal interest at the rate of 6% per annum from the filing of the complaint; and the sum of Fifty Thousand Pesos (P50,000.00) as attorney's fees and costs of litigation, is REINSTATED.
SO ORDERED.
Vitug, and Carpio, JJ., concur.
Davide, Jr., C.J., (Chairman), no part due to close relationship to a party.
Azcuna, J., on official leave.
A look at the RESA Law
By Atty. Manuel M. Serrano (The Philippine Star) Updated October 01, 2010 12:00 AM/ http://www.philstar.com/Article.aspx?articleId=616761&publicationSubCategoryId=76
MANILA, Philippines - Throughout the country real estate developers are up in arms over certain provisions of R.A. 9646, also known as the “Real Estate Service Act of the Philippines” (RESA), which regulates the practice of real estate service in the Philippines, creating for the purpose a Professional Regulatory Board of Real Estate Service (PRBRES) and its subsequent funding.
Much of the protestations stem from Sections 28 (a) and 29 of the RESA Law, which prohibit real estate developers from practicing real estate service in the country. To many developers the practice of real estate service, which includes offering, advertising, soliciting, listing, promoting, negotiating and selling of real estate is not only an integral part of their business but an inherent right. Having invested millions in the development of their projects developers have much to lose in the business and it is only fitting that they provide not only quality products but quality real estate service as well.
More important is the fact that real estate developers have acquired, through years of practice and experience, greater knowledge, expertise, vision and professionalism in providing real estate service. For developers to go to brokers and middlemen, most of whom are in their employ anyway, is illogical, to say the least. Because developers, whether natural or juridical, place greater premium on giving quality service compared with brokers and middlemen whose major interest is to earn as high a commission as possible. That is why developers should be included in the exemption and not be subjected to licensing and registration the law now requires.
From a legal standpoint, the spirit on which the law was premised appears shaky and at best, unconstitutional, because the prohibition is not germane to the subject matter of the RESA Law. First, it is one thing to regulate the practice of real estate, which the law mandates, and it is quite another thing to prohibit developers from engaging in the practice of real estate service in connection with their own properties. The latter is not embraced by the former. This is obviously a violation of Section 26 (1) of Article VI of the Philippine Constitution which states that “every bill passed by the Congress shall embrace only one subject which shall be expressed in the title thereof.”
The prohibition against real estate developers from engaging in real estate service is an unreasonable and unlawful deprivation of their property rights, in violation of Section 1, Article III of the Constitution, which holds, among others, that “no person shall be deprived of life, liberty or property without due process of law.” It also impinges on their right to dispose of their property under Article 428 of the Civil Code.
The RESA Law simply puts developers at the mercy of brokers and middlemen who from the start had no participation in the development and conceptualization of the properties they will be servicing. Thus CREBA is urging the Professional Regulatory Commission to suspend the aforementioned provisions in the RESA which prevent developers from practicing real estate service on their own or as an alternative, exempt real estate developers from the licensing and registration requirements.
(Atty. Serrano is the chairman of the Chamber of Real Estate and Builders Associations Inc. or CREBA)
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