2015 Guidelines on Time of Completion

February 14, 2016

HLURB MEMORANDUM CIRCULAR NO. 003-16

 

Pursuant to Section 14 of the Housing and Land Use Regulatory Board (HLURB) Resolution No. 926, Series of 2015, or the Revised Implementing Rules and Regulations (IRR) to Govern the Time of Completion of Subdivision and Condominium Projects under Presidential Decree No. 957, Otherwise Known as the "Subdivision and Condominium Buyers' Protective Decree" and All Other Projects Required By Law to be Registered with the Housing and Land Use Regulatory Board", this Guidelines is hereby issued:

RULE I

General Provisions

SECTION 1. Title. — This Guidelines shall be referred to as the "2015 Guidelines on Time of Completion".

SECTION 2. Scope of Application. — This Guidelines shall apply to all projects required by law to be registered with HLURB.

When used in this Guidelines, the word "project" shall include:

2.1 All subdivisions, including residential commercial, farmlot, and industrial subdivisions;

2.2 All condominiums, including residential and commercial condominiums; and

2.3 Any other similar projects, including cemeteries, memorial parks and columbaria.

SECTION 3. Objective. — This Guidelines aims to provide a uniform application, interpretation, usage, and implementation of Board Resolution No. 926, Series of 2015 in order to ensure that all projects, including the construction and provision of the facilities, improvements, infrastructures and other forms of development, including water supply and electrical facilities, which are offered and indicated in the approved project plans, brochures, prospectus, printed matters, letters, or in any form of advertisement are completed within one year from the date of issuance of the license to sell of the project or within such other period of time as may be fixed in accordance with this Guidelines. CAIHTE

SECTION 4. Definition of Terms.— When used in this Guidelines, the following terms shall be understood to mean as follows:

4.1 "Cease and Desist Order" refers to an order issued by the HLURB directed against a developer enjoining it from committing certain acts in relation to its project by reason of a violation of Presidential Decree No. 957, Batas Pambansa Blg. 220, or any of their implementing rules and regulations or any guidelines or circular issued thereunder.

4.2 "Cemetery" refers to a public or private land used for the burial of the dead and other uses indicated for cemetery purposes.

4.3 "Columbarium" refers to any structure, either freestanding or part of another building, containing niches for the inurnment of cremated human remains.

4.4 "Commercial Condominium" refers to the entire parcel of real property divided or to be divided primarily for commercial purposes into commercial units, including all structures thereon.

4.5 "Commercial Subdivision" refers to a tract or parcel of land registered under Act No. 496 which is partitioned primarily into individual lots for commercial use with or without improvements thereon and offered to the public for sale in cash or in installment terms.

4.6 "Condominium Project" refers to the entire parcel of real property divided or to be divided primarily for residential purposes into condominium units, including all structures thereon, and offered to the public for sale, in cash or in installment terms.

4.7 "Developer" refers to any person who develops or improves the subdivision project or condominium project for and in behalf of the owner thereof.

4.8 "Farmlot Subdivision" refers to a subdivision project primarily intended for agricultural production, with a minimum lot area of 1000 sq.m. and with a 25% maximum allowable buildable area.

4.9 "Industrial Subdivision" refers to a tract of land partitioned into lots for sale or lease to establishments engaged primarily in industrial production or services. The degree of development may be limited to the provision of utilities and allocation of areas for industrial buildings, facilities, and amenities, or it may also include the provision of buildings, facilities, and amenities.

4.10 "Land Development" refers to land clearing and grubbing, road construction, installation of power and water distribution system, construction of drainage and sewerage system and other developments contained in the approved plans and/or in the brochure and advertisement.

4.11 "Memorial Park" refers to a privately-owned cemetery provided with a systematic supervision and maintenance where park-like atmosphere is its outstanding quality.

4.12 "Owner" refers to the registered owner of the land subject of a project. An owner who develops a project by himself shall be considered as a developer.

4.13 "Project" refers to the different real estate development enumerated under Section 2 hereof which are required by law to be registered with the HLURB.

4.14 "Sale" or "sell" shall include every disposition or attempt to dispose, for a valuable consideration, of any lot, including the building and other improvements thereof, or any unit in a project. "Sale" and "sell" shall also include a contract to sell, a contract of purchase and sale, an exchange, an attempt to sell, an option of sale or purchase, a solicitation of a sale, or an offer to sell, directly or by an agent, or by a circular, letter, advertisement or otherwise.

 A privilege given to a member of a cooperative, corporation, partnership, or any association and/or the issuance of a certificate or receipt evidencing or giving the right of participation in, or right to, any land in consideration of payment of the membership fee or dues, shall be deemed a sale within the meaning of this definition.

4.15 "Subdivision Project" shall mean a tract or a parcel of land registered under Act No. 496, as amended by Presidential Decree No. 1529, which is partitioned primarily for residential purposes into individual lots with or without improvements thereon, and offered to the public for sale, in cash or in installment terms. It shall include all residential, commercial, industrial and recreational areas as well as open spaces and other community and public areas in the project.

4.16 "Time of Completion" refers to the period of time fixed by the HLURB within which the owner or developer shall develop and complete the project, including the construction and provision of facilities, improvements and other forms of development, including water supply and electrical facility. DETACa

All other words as may be used in this Guidelines shall be interpreted in accordance with their normal and popular usage and meaning.

RULE II

General Rules and Guidelines

SECTION 5. Time of Completion. — Within one year from the date of the issuance of the license for the project or such other period of time as may be fixed by the HLURB in accordance with this Guidelines, every owner or developer shall construct and provide the facilities, improvements, infrastructures and other forms of development, including water supply and electrical facilities, which are offered and indicated in the approved project plans, brochures, prospectus, printed matters, letters or any form of advertisement.

SECTION 6. Additional Period of Time to Complete.— No extension or additional period of time may be granted to develop and complete the project unless such failure or inability of the owner or developer to complete the project within the original period is caused by:

6.1 Existence of sub-soil conditions discoverable only after actual excavation works in the project and would necessarily require additional excavation time;

6.2 Occurrence of an event which is independent of the will of the owner or developer, unforeseeable or unavoidable, and causes damage to the on-going project that requires reconstruction or causes delays which are directly attributable to the event and renders its completion within the original approved period impossible in a normal manner; provided however that the owner or developer is free from any participation or aggravation of the damage sustained by the project, and provided finally that the owner or developer may report the event to the RFO where the project is registered within thirty (30) days from the occurrence thereof to put on record such event and its effect on the project; or

6.3 Issuance of a lawful order of the court, government agency or local government unit resulting to the temporary enjoinment or stoppage of the construction or development of the project except when the issuance of such order is attributable to any fault, mistake, or negligence on the part of the owner or developer, or by reason of any dispute between the owner and developer in the development and completion of the project, and provided further that the owner or developer shall have, within thirty (30) days from receipt or knowledge thereof, notified in writing the Regional Field Office (RFO) where the project is registered of such issuance.

The additional period of time as provided under this section shall only be granted upon posting of a new bond or security in accordance with the existing rules and guidelines of the HLURB.

SECTION 7. Monitoring.— In the exercise of its visitorial powers, the HLURB may, on its own initiative or upon verified complaint, monitor the completion and development of all projects in accordance with the rules and guidelines herein provided and impose appropriate sanctions, fines and penalties in case of violation or non-compliance herewith.

RULE III

Time of Completion

SECTION 8. Periods of Completion. — The work program or program of development submitted for approval by the owner or developer upon application for the project's Certificate of Registration and License to Sell (CR/LS) shall primarily be the basis for fixing the period of completion of the project. In the case of residential subdivision projects with house and lot package, there shall be separate periods of completion for land development and house construction, as hereinafter provided.

The work program or program of development shall consider and provide for reasonable allowance for possible delay in the project development due to work interruptions or temporary suspensions brought about by inclement weather, prolonged or repeated power failures, shortage of construction supplies or materials, and other similar incidents.

SECTION 9. Period of Completion for Land Development. — The work program or program of development submitted for approval by the owner or developer upon application for the project's Certificate of Registration and License to Sell (CR/LS) shall primarily be the basis for fixing the period of completion. In fixing such period of completion, the project's level of development, at the time of the issuance of the project's CR/LS, shall also be considered.

SECTION 10. Period of Completion and Delivery of Housing Components.— The period of completion and delivery of any housing unit purchased shall be explicitly provided in the contract to sell or any purchase agreement.

In the absence of such provision or in case of failure to indicate the same, the period of completion and delivery of the housing unit shall in no case exceed one (1) year from the date of purchase.

SECTION 11. Subdivision Amenities and Facilities.— All subdivision amenities and facilities such as clubhouse, playgrounds, sport facilities and other infrastructures as may be included in the approved project plans, brochures, prospects printed matters, letters or any forms of advertisement shall be developed and completed within the submitted and approved period for the project's land development.

SECTION 12. Condominium Amenities.— All amenities and facilities included in the approved plan or included or represented in brochures, prospectus, printed matters, letters or any form of advertisement of the project shall all be completed in accordance with the work program or program of development of the project.

SECTION 13. Uniform Statement of Date of Completion on the License to Sell and Advertisements.— The date of completion of the project shall include the month, day and year and shall be indicated on the license to sell of the project.

For subdivision project with housing component, the date of completion and delivery of the housing component shall be stated as one of the conditions in the license to sell as follows:

"The date of completion and delivery of the housing component shall be explicitly provided in the contract to sell or any purchase agreement.

In the absence of such provision or in case of failure to indicate the same, the period of completion and delivery of the housing unit shall in no case exceed one (1) year from the date of purchase."

Such time of completion as indicated on the license to sell is a condition for the issuance of the license to sell and shall be binding and obligatory on the part of the owner or developer unless a shorter period of completion or delivery is represented in any form of advertisement for the project.

Such date of completion of the project and date of completion and delivery from date of purchase of any housing unit, if applicable, is a mandatory statement in any advertisement of the project and shall likewise be stated therein.

RULE IV

Additional Time of Completion

SECTION 14. Application for Additional Time of Completion. — The owner or developer who shall not be able to complete the project, including all improvements thereon, within the approved time of completion by reason of any of the circumstances provided under Section 6 hereof may apply for an additional period of time to complete the project with the RFO where the project is registered by submitting the following:

14.1 Sworn application by the owner or developer, stating the grounds or reasons justifying the application for additional time to develop;

14.2 Proof of notice to all lot or unit buyers or owners;

14.3 Supporting pictures or documents, if any; ATICcS

14.4 In cases falling under Section 6.1 hereof, a sworn statement by a licensed engineer attesting to the existence of the condition justifying the grant of additional time to complete the project; and

14.5 Revised work program with computation of the remaining cost of completion duly signed or sealed by a licensed engineer or architect.

A pro-forma copy of the application for additional time of completion as provided under Section 14.1 hereof is hereto attached as Annexes "A" and "A-1".

SECTION 15. Notice to All Lot or Unit Buyers or Owners.— Any owner or developer applying for additional time of completion in accordance with this Guidelines shall notify all lot or unit buyers or owners of its intent to apply for additional time to complete the development of the project.

SECTION 16. Periods to Apply.— All applications for additional period of time to complete the project as may be justified under Section 6 hereof shall be filed:

16.1 Under Section 6.1 hereof, within sixty (60) days from discovery thereof;

16.2 Under Section 6.2 hereof, within sixty (60) days prior to the expiration of the approved original time of completion, provided however that if such occurrence shall fall within the last sixty (60) days of the approved period of completion, the application shall be filed within sixty (60) days from the occurrence thereof; and

16.3 Under Section 6.3 hereof, within sixty (60) days from receipt or knowledge of the order or issuance of a court, government agency or local government unit lifting the enjoinment or stoppage of the construction or development of the project.

SECTION 17. Evaluation and Grant of Additional Period of Time.— Upon receipt of any application for additional period of time, the RFO shall verify the nature and extent of damage or validate the justification for the application of additional time to develop, and ascertain the additional period of time needed to complete the project and the estimated remaining cost of completion. If necessary, the RFO may conduct an ocular inspection of the project.

If the RFO finds justifiable reason to grant the additional period of time in accordance with Section 6 hereof, it shall proceed to grant the application. Otherwise, it shall deny the same. Any appeal from the decision of the application by the RFO shall be decided by the Supervising Commissioner. Any such decision of the Supervising Commissioner may be appealed to the Board of Commissioners in accordance with the existing rules of procedure of HLURB.

SECTION 18. Fees.— The fees provided for extension or additional time to develop applicable to the different classifications of subdivision and condominium projects in the approved Schedule of Fees of the HLURB, including Processing Fee, Additional Fee, and Inspection Fee are hereby adopted and made applicable to grant of additional time to complete the project as provided under this Guidelines.

SECTION 19. Posting of Performance Bond or Security.— The grant of additional time to complete the project as may be justified under Section 6 hereof shall only be effective upon posting of an acceptable performance bond or security in accordance with existing HLURB rules and guidelines.

RULE V

Monitoring, Completion and Offenses and Sanctions

SECTION 20. Monitoring.— Upon issuance of the development permit or the CR/LS of the project, its development and completion shall be subject to the regular monitoring activity of the RFO where the same is registered.

SECTION 21. Issuance of Certificates of Completion for Land Development and Housing Component. — Upon completion of the project's land development, the owner or developer shall apply for the issuance of Certificate of Completion for Land Development (COCLD) from the RFO where the project is registered. Upon completion of the housing component, a separate Certificate of Completion for Housing Component (COCHC) may also be issued. If upon ocular inspection the project is found to have been completed in accordance with the approved work program or program of development, a COCLD or COCHC shall be issued in accordance with the existing rules and guidelines of the HLURB.

The issuance however of a COCLD shall not relieve the owner or developer of the obligation to maintain the roads, alleys, sidewalks, playgrounds, amenities, facilities, improvements infrastructures or other forms of developments represented or promised in brochures, prospectus, printed matters, letters or any form of advertisement of the project, until proper donation or turnover of the same.

SUB-RULE V-A

Non-Completion of the Project within the Approved Period of Time

SECTION 22. Effects of Non-Completion. — Except as provided under Section 6 hereof, non-completion of the project within the approved time of completion shall entitle a buyer to exercise its rights in accordance with Presidential Decree No. 957 and the Civil Code of the Philippines, in addition to the other rights and remedies provided for by other laws as may be warranted under the circumstance. Administrative fines, sanctions and penalties shall likewise be imposed on the owner or developer as provided under Sections 25, 26 and 27 hereof.

SECTION 23. Notice of Alleged Reported Violation for Failure to Complete within the Approved Period of Time.— If upon complaint or monitoring the project is found not completed within the period fixed by the HLURB, a Notice of Alleged Reported Violation (NORAV) shall be served upon the owner or developer, requiring the latter to submit within ten calendar (10) days from receipt thereof an explanation under oath why no administrative fine and sanctions and a cease and desist order (CDO) as provided under Section 25 hereof should be imposed against it. TIADCc

SECTION 24. Order of Imposition of Fine.— If the owner or developer shall fail to comply with the order as provided under Section 23 hereof or shall fail to justify the non-completion of the project in accordance with HLURB's existing rules and guidelines, an order accordingly imposing administrative fines and sanctions shall be issued and the owner or developer shall further be ordered to submit within ten (10) calendar days:

24.1 A revised or updated Fact Sheet and Program of Development signed and sealed by a licensed engineer, indicating the new target date of completion;

24.2 Revised or updated remaining cost of completion;

24.3 Updated Sales Status Report as certified true and correct by a responsible officer of the corporation;

24.4 An Affidavit or Sworn Undertaking to refund payments to affected buyers pursuant to Presidential Decree No. 957; and

24.5 Proof or payment of the required processing fee in accordance with HLURB's approved Schedule of Fees.

Upon review of the submitted document, a final order shall be issued requiring the owner or developer to complete the development of the project within such period as may be fixed by the HLURB based on the submitted revised documents, without prejudice to the imposition of administrative fines and sanctions as hereinafter provided. The owner and developer shall be further required to post a bond or security, and submit proof of posting thereof, in accordance with HLURB's existing rules and guidelines.

SUB-RULE V-B

Fines and Sanctions

SECTION 25. Administrative Fines and Sanctions.— In case of non-completion of the project within the approved period time of completion, an administrative fine shall be imposed in accordance with approved Schedule of Fines and other existing rules and guidelines of the HLURB.

SECTION 26. Suspension of the License to Sell. — In case of non-completion of the project within the approved period time of completion, the license to sell of the project shall be suspended and a corresponding Cease and Desist Order (CDO) shall be issued enjoining the owner or developer from further selling any lot, including any building or improvement thereon, or any unit in a project, from advertising the project, and from collecting amortization payment in accordance with the existing rules and guidelines of the HLURB. Such suspension and CDO shall not be lifted until the project shall have been completed and a COCLD is issued to the project.

SECTION 27. Penalties. — In addition to the imposition of administrative fines and sanctions provided under Sections 25 and 26 hereof, any violation of Board Resolution No. 926, Series of 2015 and of this Guidelines shall be penalized in accordance with the provisions of Executive Order No. 648 and Section 38 (Administrative Fines) and Section 39 (Penalties) of Presidential Decree No. 957.

All fines imposed in this Guidelines shall be payable to HLURB and enforceable through writs of execution in accordance with the existing HLURB's Rules of Procedure. The rights and remedies provided in this Guidelines shall be in addition to any and all other rights and remedies that may be available under existing laws.

SECTION 28. Separability Clause.— The provisions of this Guidelines are hereby declared separable, and in the event that any provision herein is declared null and void, the validity of all other provisions shall not be affected thereby.

SECTION 29. Effectivity Clause.— This Guidelines shall take effect immediately.

SECTION 30. Transitory Provision. — Within ninety (90) days from the effectivity of this Rules, all on-going projects with an original approved period of completion or extension of time to develop that is shorter than the period of completion provided in the originally submitted or revised work program or program of development may apply for a final additional time to develop and complete the project based on their approved or revised work program or program of development, subject to existing rules and regulations and guidelines of the HLURB.

All applications for extension of time already filed upon the effectivity of Board Resolution No. 926 shall be given a final extension of time which shall be based on the submitted revised work program or program of development.

For immediate implementation and strict compliance.

(SGD.) ANTONIO M. BERNARDOCommissioner and Chief Executive Officer

ANNEX A

Housing and Land Use Regulatory Board

_____________________ Region Field Office

RE: ________________________

____________________________

(Name of Project and its Location

_________________

The Regional Officer:

Pursuant to pertinent laws and implementing rules and regulations of this Board, I am hereby applying for ADDITIONAL PERIOD OF TIME TO DEVELOP for the above-mentioned project by reason of: AIDSTE

[ ] Project's Sub-Soil Condition Requiring Additional Excavation Period

[ ] Fortuitous Event Causing Damage in the Project or Delay in the Development

[ ] Lawful Order of Court, Tribunal, Government Agency or Local Government Unit Enjoining the Construction or Development of the Project

Brief Description of the Above-Marked Ground for Additional Period of Time:

______________________________________________________________

______________________________________________________________

______________________________________________________________

Please consider the attached documents listed below with check or cross ("/" or "X") consistent with the list or requirements stated in the Implementing Rules and Regulations of PD 957 and numbered consecutively to support the application for Additional Period of Time:

[ ] Proof of Notice to HLURB of Issuance of the Lawful Order

[ ] Proof of Notice to Buyers

[ ] Sworn Statement of Licensed Engineer Attesting to the Sub-Soil Condition

[ ] Revised Work Program Signed by a Licensed Engineer with Computation of Remaining Cost of Completion

[ ] Supporting Pictures

[ ] Performance Bond

I can be reached at:

 

ANNEX A-1

 

In this connection, I attest to: (1) the truth and veracity of the foregoing; (2) that duplicate copies are true and faithful reproduction of the original documents; and (3) that documents conform strictly to the official checklist of requirements and the detailed description thereof.

Very truly yours,

__________________________(Printed Name and Signature)

SUBSCRIBED AND SWORN to before me this ______ day of ___________, 20___, affiant exhibiting his/her _______________________ [Competent Evidence of Identification] issued at ______________________________ on __________________________.

NOTARY PUBLIC

 

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