PD 957 Criminal Cases Belong to Regular Courts, Not HLURB

The Supreme Court has settled a recurring question about Presidential Decree No. 957, the Subdivision and Condominium Buyers' Protective Decree: who has jurisdiction over criminal cases arising from its violation? In Dazon v. Yap (G.R. No. 157095, January 15, 2010), the Court ruled that the Housing and Land Use Regulatory Board (HLURB) handles only civil and administrative matters, while criminal prosecutions belong to the regular courts. The ruling protects buyers who seek criminal remedies against erring developers.

The Case

Ma. Luisa Dazon bought a condominium unit from Primetown Property Group, Inc., whose president was Kenneth Yap. She paid over P1.1 million, but the project was never finished. When she demanded a refund under Section 23 of PD 957, the developer refused. Dazon then filed a criminal complaint against Yap for violation of Section 23 in relation to Section 39 of the decree.

The city prosecutor found probable cause and filed an Information with the Regional Trial Court (RTC). But the Secretary of Justice, on Yap's petition for review, ordered the withdrawal of the Information. The DOJ reasoned that the HLURB—not the RTC—had jurisdiction over the case. The RTC granted the motion to withdraw, prompting Dazon to elevate the matter to the Supreme Court.

The Issue

The sole question was whether a regional trial court has jurisdiction over a criminal action arising from a violation of PD 957.

The Ruling

The Supreme Court ruled in Dazon's favor, holding that regular courts, not the HLURB, have jurisdiction over criminal cases under PD 957.

The Court explained that jurisdiction is conferred by law and is determined by the allegations in the complaint and the relief sought. The HLURB's jurisdiction is limited to what its enabling statutes expressly grant. Under PD 957, the former National Housing Authority (now HLURB) was given exclusive jurisdiction to regulate the real estate trade and business—specifically, registration of projects and licensing of dealers, brokers, and salesmen.

PD 1344 later expanded the HLURB's adjudicative powers to cover:

• Unsound real estate business practices;
• Claims involving refunds and other claims by buyers against developers; and
• Cases involving specific performance of contractual and statutory obligations.

Notably, criminal cases are absent from this enumeration. The Court applied the rule expressio unius est exclusio alterius—the express mention of one thing excludes others. Since criminal cases were not mentioned, the HLURB cannot exercise jurisdiction over them.

The Court also compared Sections 38 and 39 of PD 957. Section 38 grants the HLURB power to impose administrative fines not exceeding P10,000. Section 39, which provides for criminal penalties of up to P20,000 and/or imprisonment of up to ten years, conspicuously does not state that the HLURB may impose such punishment. Administrative agencies are tribunals of limited jurisdiction and can wield only powers expressly granted by their enabling statutes.

Since the HLURB was not specifically conferred with power to hear criminal cases or impose criminal penalties, it has no jurisdiction over them. Instead, under Batas Pambansa Blg. 129, the RTC exercises exclusive original jurisdiction over all criminal cases not within the exclusive jurisdiction of any other court, tribunal, or body.

The Court found that the DOJ's directive to withdraw the Information was based on an erroneous premise—that the HLURB had jurisdiction—not on a finding of lack of probable cause. The Court reversed the RTC orders and directed it to proceed with Yap's arraignment.

Practical takeaways

• Buyers have a choice of remedies. A buyer aggrieved by a developer's violation of PD 957 may seek civil or administrative relief before the HLURB, and may also pursue criminal prosecution before the regular courts.
• The HLURB cannot convict or punish criminals. Its mandate is regulatory and adjudicative in civil matters; it cannot impose imprisonment or fines beyond its administrative authority.
• Jurisdiction is determined by the complaint's allegations. If the complaint alleges a criminal violation of PD 957, the case belongs to the RTC regardless of what the HLURB might also hear.
• A prosecutor's withdrawal of an Information is not final. Courts review the basis for withdrawal; if it rests on an erroneous legal premise, the case may be reinstated.
• Corporate officers can face personal criminal liability. Under Section 39 of PD 957, the president, manager, or administrator of a violating corporation is criminally responsible for the offense.

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