Condominium Rights: Exclusive Use vs Unrestricted Construction on Common Areas

The Supreme Court recently settled an important question for condominium owners and developers: does the exclusive right to use a limited common area—such as a roof deck—carry with it the freedom to build structures and lease them to others? In Goldcrest Realty Corporation v. Cypress Gardens Condominium Corporation (G.R. No. 171072, April 7, 2009), the Court answered with a clear no. The decision protects unit owners by affirming that exclusive use is not an unrestricted license to alter or commercialize common property.

The Facts

Goldcrest Realty developed Cypress Gardens, a ten-storey condominium in Makati City. The Master Deed constituted the building into a condominium project and created the Cypress Gardens Condominium Corporation to manage it and hold title to common areas. Goldcrest retained ownership of the two-level penthouse unit.

Under Section 4(c) of the Master Deed, a portion of the roof deck was designated as a limited common area for the exclusive use of the penthouse unit. After management was turned over to the condominium corporation in 1995, it discovered that Goldcrest had occupied and built on common areas. The corporation filed a complaint with the HLURB, seeking the removal of structures including doors on stairways, a fence on the roof deck, and a permanent structure encroaching on the roof deck's common area.

The Issue

The central question was whether Goldcrest, as the holder of an exclusive easement over the roof deck's limited common area, could construct permanent structures on it and lease them to third persons without the condominium corporation's approval.

The Ruling

The Supreme Court denied Goldcrest's petition and affirmed the Court of Appeals' directive to remove the permanent structures built on the roof deck's limited common area. The Court held that an exclusive easement does not grant unrestricted rights over the servient estate.

Citing the Civil Code, the Court enumerated the restrictions on the owner of a dominant estate:

• The owner may exercise only rights necessary for the use of the easement.
• The easement cannot be used except for the benefit of the immovable originally contemplated.
• The easement cannot be exercised in any manner other than that previously established.
• Nothing may be constructed on the easement that is not necessary for its use and preservation.
• The easement cannot be altered or made more burdensome.

The Court found that Goldcrest breached these restrictions. The office structure was not necessary for the use or preservation of the roof deck area. Its weight increased strain on the building's foundation, making the easement more burdensome and adding safety risks. The construction also violated Section 22 of Presidential Decree No. 957, which prohibits altering approved condominium plans without permission, and Section 4 of the condominium's Declaration of Restrictions requiring prior written approval for structural alterations.

Practical Takeaways

• Exclusive use is not ownership. A limited common area designated for a unit's exclusive use remains common property. The right is an easement, not a license to build freely.
• Construction requires approval. Even within an exclusively used area, structural alterations need the condominium corporation's prior written approval, especially if they affect safety or impair easements.
• Leasing common areas is risky. Commercializing a limited common area by leasing it to third parties goes beyond the scope of the easement and can be ordered removed.
• Alterations must not burden the building. Any construction that adds weight or risk to the structure violates condominium rules and the law, regardless of exclusive use rights.
• Documentation matters. The specific boundaries of limited common areas should be clearly identified in the Master Deed to avoid disputes.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.