Dr. Robert M. Sears

February 8, 2001 DR. ROBERT M. SEARS Director, PAGCC 2nd Floor, Corinthian Plaza Paseo De Roxas, Makati City Dear Dr. Sears, This is reference to your letter dated November 29, 2000 seeking our opinion on the following queries: 1. Do developer shares, who do not pay dues, have the right to vote? 2. Voting is the privilege of regular members and therefore, if said shared vote, should they not pay dues? 3. Can the developer shares, non-dues and non-voting, be billed by the Board of Directors for special assessments, the same as regular members? The issues raised in the above-quoted queries hinge on the interpretation of Sec. 3 of the by-laws of Puerto Azul Golf and Country Club which provides as follows: "Sec. 3 - Classification xxx xxx xxx The monthly dues payable by each regular member shall not be assessed and collected with respect to shares that we issued in favor of the developer or financiers of the club unless such developer or financier make use of the privileges of a regular member with respect to those shares." The answer to your first query is in the negative. From the aforequoted by-laws provision it is explicitly provided that holders of developer or financier shares shall not be assessed the regular monthly dues except when the holder thereof would like to avail of the privileges of a regular member. Considering, the premise in your query that the involved developer shares do not pay dues, then they are not entitled to vote as one of the privileges of regular members. Anent your second query, it follows that if the developer shares would exercise the right to vote the corresponding dues must consequently be assessed and paid. Finally, the third issue of whether the developer shares, non-dues and non-voting, can be filled for special assessments by the board is also answered in the negative. As van be deduced from the aforequoted by-laws provision only "monthly dues" may be assessed and collected from developer or financier shares. The said proviso does not include special assessments. In simple terms, the general rule is that developer or financier shares shall not be assessed monthly dues. It is only when the holders of developers shares make use of the privileges of the regular members that corresponding dues, excluding special assessments, shall be charged and collected from them just like regular members. Please be guided accordingly. Very truly yours, (SGD. ) FE ELOISA C. GLORIA Commissioner