Makati Commercial Estate Association vs. H.O. Ysobel Yasay-Murillo & RDR Property Holdings, Inc.

[SEC-EB NO. 407. January 17, 1995.] MAKATI COMMERCIAL ESTATE ASSOCIATION, INC., ET AL. , petitioners , vs . H.O. YSOBEL YASAY-MURILLO & RDR PROPERTY HOLDINGS, INC. , respondents . O R D E R This is a petition for certiorari filed by the Makati Commercial Estate Association, Inc. (MACEA for short) against the order dated March 7, 1994 of the respondent hearing officer of SEC-Case No. 02-94-4685 denying herein petitioner's motion for the dismissal of the said case and the order dated May 25, 1994 denying its motion for reconsideration. MACEA, along with Ayala Corporation and Ayala Land, Inc. (ALI for short), Cesar V. Campos and Jaime R. Matias, was named respondent in a petition filed with this Commission on February 18, 1994 by RDR Property Holdings, Inc. (RDR for short). The petition below alleged, among others, that MACEA is an association of real estate owners and long-term lessee of lots within the commercial district in Makati developed by respondents Ayala Corporation and ALI; that RDR is the owner-developer of a 37-storey commercial/residential building denominated as "The Peak" located on Alfaro St., Salcedo Village, Makati, Metro Manila; that RDR is a member of MACEA, that respondent Campos is a member of MACEA'S board of governors while respondent Matias is MACEA's executive secretary/manager, that on November 14, 1993 and again on February 6, 1994 MACEA, through respondents Campos and Matias evidently using funds of the association, published in the Manila Bulletin libelous notices which were patently designed in bad faith and with malice aforethought to damage petitioner RDR and "The Peak", to jeopardize the marketing campaign thereof, and to discredit and harass RDR as its owner-developer; and that respondents MACEA, Ayala Corporation and ALI engaged in oppressive and discriminatory real estate practices, unfair competition, and machinations to monopolize the real estate development industry in the Makati area. Petitioner below prayed for the recovery of damages and for the issuance of a temporary restraining order and preliminary injunction to prevent the respondents from further publishing in newspapers of general circulation notices or announcements which are derogatory to its condominium project. On March 2, 1994 herein petitioners filed a motion to dismiss the case below on the following grounds: 1. That this Commission has no jurisdiction over the issues raised in the petition; 2. That there are other actions pending between the same parties for the same cause; and 3. That the filing of the case constitutes forum-shopping. For their part, Ayala Corporation and ALI filed a Consolidated Answer raising as affirmative defenses substantially the same grounds as those raised in herein petitioners' motion to dismiss. prcd On March 7, 1994 the respondent hearing officer issued an order dismissing the case below as to Ayala Corporation and ALI. On March 23, 1994 herein petitioners filed a motion for reconsideration of the March 7, 1994 order but the same was denied in an order dated May 25, 1994. Hence, this petition. There are three grounds relied upon by petitioner in this motion to dismiss the case below, namely: a) that this Commission has no jurisdiction over the issues raised in the petition, b) that there are other actions pending between the same parties for the same cause; and c) that the filing of the case constitutes forum-shopping. We shall first address the issue concerning jurisdiction. The first challenge order of the respondent hearing officer dated March 7, 1994 stated five grounds why this Commission possesses jurisdiction over the petition below. In addition to the grounds mentioned by the respondent hearing officer, we find that the subject matter of the case below is actually an intra-corporate dispute which properly falls under the jurisdiction of this Commission. It will be noted that the principal relief being sought by private respondent RDR in its petition is the prevention of therein respondents MACEA, Ayala Corporation and ALI for further publishing in a newspaper of general circulation derogatory notices or announcements concerning RDR's condominium project, "The Peak", and from harassing RDR and sabotaging its condominium project's utility services and facilities. After taking a closer look at this case, we find that the dispute between RDR and MACEA stems from RDR's apparent non-compliance with certain rules and regulations of MACEA. The following pertinent provisions can be found in MACEA's by-laws: ARTICLE III, Section 6. Liability for Causes of Action . The members thereto agree as a condition of membership that the Association has the right to institute causes of action against any member for purposes of enforcing the deed restrictions on the properties in the area, and for violations of lawful rules and regulations that may be promulgated by the Board of Governors or by the Association within the spheres of their jurisdiction. ARTICLE III, Section 11. Penalty for Violations . In case of violation of the rules and regulations promulgated by the Association or of the deed of restrictions on the use and occupancy of the property in the premises, the Board of Governors, or a committee created by the latter, may investigate the erring member. In case a committee is appointed, it shall render a report of its findings to the Board of Governors which may accept or reject the report of the Committee. The Board shall consider such charges or report of the Committee and if, in its opinion, disciplinary action is warranted, it shall hold a hearing if requested by the erring member, under such rules and regulations as the Board may prescribe to give such member a chance to defend and present his side of the case. If the Board finds such member to be guilty of the charge, the Board shall be empowered to impose liquidated damages against the erring member If the erring member refuses to pay the liquidated damages as decided by the Board, the Association may proceed to collect the same from the member thru proper court action, plus attorney's fees, and costs of litigation as may be warranted by the case. LexLib ARTICLE IV, Section 2. Powers of the Board of Governors . . . . The Board of Governors shall also be vested with the power to enforce deed restrictions and adopt lawful rules and regulations, with or without penalty, governing the use and occupancy of buildings and premises in the area, as well as the conduct of business and activities therein. . . . From the foregoing provision of MACEA's by-laws, it can be gleaned that the association wields the power and authority to enforce deed restrictions on the properties in its area of jurisdiction, including the property of RDR. The publication by MACEA of notices concerning RDR's condominium project, "The Peak", to our mind is pursuant to its authority to require RDR to comply with certain deed restrictions on its property and with the association's rules and regulations. Consequently, the subject matter of the case below, which is the prevention of respondents from further publishing notices prejudicial to "The Peak", is intra-corporate in nature over which this Commission exercises jurisdiction. The second ground relied on by petitioners herein in their motion for the dismissal of the case the pendency of other actions between the same parties for the same cause is untenable because the reliefs being sought in the other case is different from the reliefs being sought in the case at bar. Having said that, it follows that the filing of the case below does not constitute forum-shopping, as claimed by petitioners herein. cdll WHEREFORE, we find that the respondent hearing officer did not act with grave abuse of discretion in issuing the assailed order and the instant petition for certiorari is hereby DENIED for lack of merit. SO ORDERED. (SGD.) ROSARIO N. LOPEZ Chairman (SGD.) RODOLFO L. SAMARISTA (SGD.) MERLE O. MANUEL Associate Commissioner Associate Commissioner (did not participate) (SGD.) FE ELOISA C. GLORIA (SGD.) PERFECTO R. YASAY, JR. Associate Commissioner Associate Commissioner