Attached herewith is HLURB Board Resolution R-960, Series of 2017, Rules of Procedure   in  the  Conduct  of  Administrative   Inspections   and  Investigations, approved by the Board on 27 November 2017.

The said Board Resolution was published in The Philippine Star on 08 February
2018,  and  in  accordance  with  the  pertinent  provisions  of law,  will  take  effect fifteen (15) days from its date of publication, on 23 February 2018.

Please be guided accordingly.


Attachment:


Pursuant to Section S(c) and (j), Executive Order No. 648, Series of 1981, as amended by Executive Order No. 90, Series of 1986, and Executive Order No. 535, Series of 1979, as amended   by  Republic   Act  No.   9904,   otherwise   known   as  the   œMagna   Carta   for Homeowners  and Homeowners  Association   and in revision  of Board Resolution  No. R-
611, Series of 1998, otherwise known as the Administrative Rules of Procedure in the Monitoring of Projects and Imposition of Sanctions, the Housing and Land Use Regulatory Board hereby adopts and promulgates the following:


Section  1.  Title.  -  This  Rules  shall  be  known  as  the  œRules  of  Procedure  in  the Conduct of Administrative Inspections and Investigations,  hereinafter referred to as the œRules. 

Section 2. Objectives. - The objectives of this Rules are:

2.1  To ensure the faithful observance by the owners/developers of their obligation to fully develop the project on time and in accordance  with the approved development  plan, contractual stipulations and/or sales representations as well as to comply with the pertinent conditions imposed on clearances, permits, licenses;

2.2  To  ensure  the  efficient  and  effective  monitoring  of  all  activities  involving  the  real
estate business  or trade to protect legitimate  real estate developers  and the buying public  to achieve  a conducive  business  atmosphere  and stability  of the real estate trade;

2.3  To adopt adequate and clear procedural  guidelines  for uniformity and consistency  in the monitoring and the imposition of fines, penalties and sanctions if so warranted;

2.4  To ensure the protection of and respect for private rights through the formulation of definitive rules of procedure in the monitoring of development  projects and imposition of sanctions for violation of laws, rules and regulations being enforced by the HLURB to provide guidance to both the staff and the public;
2.5  To   consolidate,   harmonize,   and   strengthen   all  existing   and   relevant   rules   or guidelines implementing the laws, acts, decrees, executive orders and instructions governing the exercise of jurisdiction, powers and functions of the HLURB.

Section 3. Coverage. - This Rules shall be applicable to the following:

3.1  All land use projects issued locational clearances in municipalities and cities without Comprehensive   Land  Use  Plan  or  certificates   of  zoning  compliance,   variances, exceptions and temporary use permits by the HLURB;

3.2 All subdivisions, condominiums and other real estate development projects issued preliminary approval, development permit, certificate of registration, license to sell, approval  of plan alteration  or amendment  of master deeds of restrictions,  mortgage clearance,  advertisement  approval,  certificate  of completion  and other certifications related or incident thereto;

3.3  All other land use and development  projects  and real estate  transactions  including offers  or  proposals  and  arrangement  for  the  sale  and  development  of real  estate projects,  for  the  purpose  of  ascertaining  applicability  of  and  compliance  with  the mandates of the HLURB;

3.4  Letters or reports from lot/unit buyers or homeowner ™s  associations  reporting specific alleged  violations   of  the  law  and  requesting   for  investigation   or  for  advice  or assistance for the protection of their rights.

3.5  Other  analogous  cases  involving  monitoring  and  investigation   conducted  by  the Regional Office.

Section  4. Definition  of Terms.  - The terms used in this Rules shall be defined  as follows:

4.1      Adjudicatory mechanism refers to the procedure in settling disputes involving the registration  of  two  or  more  associations  established  within  the  same subdivision/village,  community area, or housing project.

4.2      Aggravating  Circumstances   are  circumstances   which  worsens  the  severity  and effects of the offense committed and may result in increasing the penalty imposed.

4.3      Articles of Incorporation,  sometimes  called a certification  of formation or a charter, refer to the document which contain general information about the association and are submitted to the Regional Field Office for determining the character or nature of the association as a non-stock, non-profit corporate entity formed for the benefit of the  homeowners   of  a  subdivision/   village  or  condominium   project,  whenever applicable

4.4      Association refers to the homeowners association, which is a non-stock, nonprofit association registered with the Housing and Land Use Regulatory Board, or one previously registered with the Home Insurance Guarantee Corporation,  now Home Guaranty Corporation (HGC) or the Securities and Exchange Commission (SEC), organized in -

4.4.1   Subdivision/village  or other subdivisions  of real property used for residential purposes;
4.4.2   Condominium projects unless the Master Deed decrees the formation of a condominium  corporation to manage the open spaces/common  areas of the project;
4.4.3   Neighborhood associations previously registered with the SEC;
4.4.4   Government  socialized or economic housing or relocation project and other urban estates;
4.4.5   Socialized housing projects under the Community  Mortgage Program, Land Tenure  Assistance  Program  and  other  similar  shelter  programs implemented by the national and local governments

4.5      Association  Member  refers to a homeowner  who is a member  of the association where  the  residential  unit  or  lot  is situated  and  those  defined  in  the  articles  of association and By-laws of the association.

4.6      Board  refers  to the  governing  body  of the  Association  whether  denominated  as Board  of Directors,  Board  of Trustees,  Board  of Governors,  and similar nomenclatures.

4.7      By-laws refer to the association ™s  rules of governance,  the institution and limitation of  powers  of  its  directors   and  officers,   and  the  establishment   of  rights  and obligations of homeowners.

4.8      Cease and Desist Order refers to the remedy whereby a party is directed to refrain from doing a particular act or acts pending the resolution of the case

4.9      Complainant  refers to the party who initiated the action and includes a respondent who  has  filed  a  counter-complaint   against   the  complainant   insofar   as  such counterclaim   is  concerned   and/or  a  respondent   who  has  instituted   a  cross- complaint against a co-respondent insofar as that crossclaim is concerned

4.10    Election Contest refers to any controversy  or dispute involving title or claim to any elective   office   in  an  Association,   the  validation   of  initiatives,   referendum   or plebiscite, the validation of proxies, the manner and validity of elections, and the qualifications of voters and candidates, including the proclamation of winners and assumption  to  the  office  of  directors,  trustees  or  other  officers  elected  by  the members where the articles of incorporation or bylaws so provide.

4.11     Homeowner refers to any of the following:

4.11.1     An owner or purchaser  of a lot or house and lot, in a subdivision/village who acquired the same primarily for residential purposes;
4.11.2     An awardee, usufructuary,  legal occupant and/or lessee of a housing unit and/or lot in a government socialized or economic housing or relocation project and other urban estates;
4.11.3     Underprivileged  and homeless  citizens as defined under existing laws in the   process   of  being   accredited   as  usufructuaries   or  awardees   of ownership rights under the Community Mortgage Program (CMP), Land Tenure Assistance Program (LTAP) and other similar programs in relation to a socialized housing project actually being implemented by the national and local governments.

4.12     HLURB shall refer to the Housing and Land Use Regulatory Board

4.13    Inspections  shall refer to the act of the responsible  officers of the Regional Office which forms part of the monitoring process for the purpose of determining  whether a project or transaction is compliant with the laws, rules, regulations and standards implemented by the HLURB.

4.14    Investigations  shall  refer  to  the  act  of  the  responsible  officers  of  the  Regional Office,  initiated  either  motu  propio  or upon  complaint  or information  from  a third party,  forming  part  of  the  monitoring  process,  for  the  purpose  of  determining whether a violation has been by the respondent of the laws, rules, regulations and standards implemented by the HLURB. The investigations may either be -

4.14.1     Field  Investigation  refers  to  the  conduct  of  an  ocular  investigation  to determine the facts incident to the imposition of sanctions for alleged violations of the law, rules, regulations and standards. This type of investigations  shall require written authority or pursuant to an order of the Regional Officer or his/her duly authorized representative;
4.14.2     Non-Field Investigation refers to the examination of the documents, things and records of the respondent to determine if sanctions are to be imposed for any alleged violation  of the laws, rules, regulations  and standards  of the HLURB.

4.15    Jurisdiction  shall  refer  to  both  authority  and  power  granted  to  a  legal  body  or person to implement the legally established mandates within a defined area of responsibility or to the geographical area to which such authority applies.

4.16    Member  in Good  Standing  refers  to a member  who  has  faithfully  complied  with his/her  duties  and obligations  as provided  by law, rules and regulations,  and the By-laws.

4.17    Mitigating   Circumstances   are   circumstances   which,   though   not   justifying   or excusing the offense committed, may reduce the severity and effects of the offense committed.

4.18    Penalties refer to the punishment  imposed by law, rule or regulation incurred for a violation of the law, rule or regulation. The penalties imposed may be classified, as follows:

4.18.1     Divisible  penalties  refer  to  those  penalties  which  has  a  minimum  and maximum amount or period;
4.18.2     Qualified penalties refer to those penalties which contain a single penalty
but is qualified  by either œnot more than  or œnot less than,  or terms  of similar import;
4.18.3     Indivisible  penalties  refer to those penalties  which are fixed without  any stated maximum or minimum, or not qualified.

4.19    Respondent  is the party against whom the complainant  has filed a complaint,  and includes a complainant against whom a respondent has filed a claim and/or a respondent  who has filed a cross-complaint  against a co-respondent.  It may also refer to the person  or entity  subject  to administrative  inspection  or investigation, field or non-field investigation,  and/or the subject of administrative  proceedings  for the purpose of determination  of whether to impose administrative  penalties for non- compliance with the laws, rules, regulations and standards of the HLURB.

4.20    Verification  is  the  written  oath  taken  by  a  party  before  a  person  authorized  to administer the oath establishing  the truth, accuracy, validity and authenticity  of the allegations of facts and documents.

Section  5.  Construction.  -  This  Rules  shall  be  liberally  construed  to  promote  the general welfare and assist the parties in obtaining a just and speedy resolution of every administrative inspection and investigation.


Section   6.  Jurisdiction.   -  The  Regional   Officer   shall  have  sole  and  exclusive jurisdiction to do and perform the following:

6.1  Inspect/Investigate   land  use  or  development   projects  or  real  estate  transactions previously  issued a clearance,  permit, license, approval or certificate  by the HLURB to  determine   whether  the  same  has  satisfactorily   complied  with  the  terms  and conditions thereof;
6.2  Inspect/Investigate   any  newly  discovered  land  use  or  development  project  or  real estate  transactions   to  determine  whether  the  same  is  subject  to  the  regulatory jurisdiction   of  the  HLURB,  and  the  owner/proponent/developer  has  secured  the mandated clearances, permits, licenses, approvals and certificates therefor;
6.3 Verify reports of alleged violations of the laws, rules, regulations and standards administered by the HLURB;
6.4  Examine corporate records, books of accounts and financial statements to ascertain compliance by developers and associations with the legal requirements; and,
6.5  Issue the appropriate notices/orders  and the imposition of corresponding  sanctions to ensure compliance with the laws, and/or rules and regulations.

Section 7. Powers. - The Regional Officer shall have the following powers:

7.1  Cease   and   Desist   Orders.   To  issue   cease   and   desist   orders   restraining   the commission or continuance of the act or acts complained of, or in requiring the performance  of an act or acts either for a limited period or perpetually subject, which shall be effective immediately upon service to the party charged.

Within ten (10) days from its issuance, the Regional Officer shall conduct a summary hearing  to  determine   if  the  COO  shall  be  continued   indefinitely   until  the  final resolution   of  the   controversy.   The   order   may   be   appealed   to   the   Board   of Commissioners  within  fifteen  (15)  days  from  notice  of its issuance,  which  appeal, however,  shall not stay the implementation  of the said order. In case the appeal is granted, the party charged shall post a supersedeas bond in an amount to be fixed by the Board of Commissioners

7.2  To recommend to the Regional Arbiter the imposition of the punishment for contempt to any person on the following grounds:

7.2.1   Those guilty of misbehavior  in the presence  of the Regional Officer or any of the personnel of the Regional Office which tend to obstruct or interrupt the proceedings, including disrespect toward the said officers, and offensive personalities toward others;
7.2.2   Disobedience of or resistance to a process, award or order;
7.2.3   Any abuse of or any unlawful interference with the processes or administrative proceedings;
7.2.4   Any  improper  conduct  tending,  directly  or indirectly,  to impede,  obstruct,  or degrade the administrative proceedings;

7.3  To order the search and seizure or cause the search and seizure of all documents, papers, files and records as well as books of accounts of any entity or person under investigation as may be necessary for the proper disposition of the cases before it;

7.4  To impose fines and/or penalties  for violation of the laws being implemented  by the
HLURB, the pertinent rules and regulations, its orders, awards and/or rulings; and,

7.5  To exercise such other powers as implied, necessary or incidental to the carrying out the express  powers  granted  or to achieve  the objectives  and purposes  of the law, rules and regulations


Section  8. Commencement.  - Proceedings  for the  imposition  of penalties  may  be instituted as follows:

8.1  Upon  the  instance  of  any  officer  or  employee  of  the  HLURB  when  the  alleged violation was committed or is being committed in his/her presence, or upon review of the documents  and things on record such a violation is probably being committed  or has been committed or is being committed; or

8.2  Upon written authority issued by the Regional Officer, in case of complaints from the general public or any person who is not an officer of the HLURB.

Section   9.  Non-Field   Inspections/Investigations.   -  In  cases   where   the  alleged violation  was committed  in the presence  of or within  the knowledge  of an employee  or officer  of the  HLURB  upon  an  examination  of the  records  and  documents  on  file,  the procedure  for  the  institution  of  the  appropriate  administrative  proceedings  shall  be  as follows:

9.1  Referral. Unless the officer or employee is assigned to the Unit which has jurisdiction over the alleged offense, the documents,  records and things shall be referred to the Head  of  the  Monitoring   or  HOA  Unit,  who  shall,  in  turn,  refer  the  same  to  a subordinate.

9.2  Evaluation. The designated personnel shall, within ten (10) working days, review all documents, records and things submitted for evaluation, including the conduct of field investigations  solely for the purpose of confirming  the facts narrated and/or authenticating  the aforesaid  documents,  records  and things:  However,  if there  is a need to conduct a more detailed and in-depth investigation to uncover additional facts and circumstances  which are not covered by the referral, the matter shall be returned to the Head of the Unit involved for the conduct of field inspection/investigation in accordance with the procedure in the succeeding section.

9.3  Non-Field  Inspection/Investigation Report. The assigned  inspector/  investigator  shall
prepare the Non-Field  Inspection  Report (NIR) stating the facts appearing  on record or borne by the documents  and things,  the laws, rules and/or  regulations  allegedly violated  and  attaching   therewith   the  records,  documents   and  things  in  support thereof, including the draft Order of dismissal or Notice of Reported Alleged Violation (NORAV)  with the Regional  Officer as signatory.  The NIR shall be submitted  to the Head of the Unit within a period of ten (10) days from the completion of the evaluation or the lapse of the 10-day period for evaluation.

Section 10. Field Investigations/Inspections. - In the event that the inspection or investigation  has been commenced  by complaint from the public or from a person who is not an officer or employee of the HLURB, the following procedure shall be followed:

10.1    Authority.  The  Regional  Officer  shall  issue  a written  Authority,  addressed  to the Head of the requesting Unit, specifying the name of the person or entity subject of the inspection/investigation, the name of the designated  inspector/investigator, the subject and scope of the inspection/ investigation,  the period within which the said inspection/investigation shall be conducted, and signed by the Regional Officer or his/her duly designated representative.

10.2     Powers. - The authorized investigators/inspectors shall have the following powers:

10.2.1     To  the  free  and  unimpeded  access  and  entry  into  the  property  and premises of the project or transaction  inspected/investigated and, for this purpose, he/she may, upon prior and expressed authority of the Regional Officer,  open  or remove  or cause  the opening  or removal  of any gate, door, barrier  or railing  that prevents,  impedes  or impairs  the conduct  of the inspection/ investigation;
10.2.2     To     conduct     interviews/conferences     with     the     project     owner/
developer/proponent or association, or their representatives, as well as residents  of  the  project  and/or  the  adjacent  projects  or  areas  for  the purpose of ascertaining  the ownership, status and degree of operation of the project  or transaction,  and its perceived  effects/implications, as well as issues and problems related thereto;
10.2.3     To require the production of permits, clearances,  licenses and approvals, receipts, contracts, corporate records, books of accounts and financial statements  relevant  to  the  exercise  of  the  regulatory  functions  of  the HLURB;
10.2.4     To call on any person, office or entity for assistance in the discharge of its functions;
10.2.5     To  exercise  such  other  powers  as  may  be  delegated  by  the  Regional Officer which may be necessary, incident, related and/or inherent to the functions of the HLURB.

10.3    Period.  The period  of the inspection/investigation  should  not be more  than thirty (30) days from the date of the issuance  of the Memorandum  of Authority.  Upon good reasons shown, the Authority may be extended for another thirty (30) days.

10.4    Site Inspection/Investigation Report. - The inspector/investigator shall prepare the Site Inspection/Investigation Report (SIR) and submit the same to the Head of the requesting Unit within a period of ten (10) working days from the termination of the field inspection/investigation.

Section 11. Processing of Investigation  Report. - The NIR or SIR shall be processed as follows:

11.1     Contents. The NIR or SIR shall contain the following:

11.1.1     The facts and circumstances pertinent to the inspection/ investigation as supported by the record;
11.1.2     The recommendations  and conclusion;
11.1.3     The  written  or  recorded  statements  of  the  inspectors/investigators  and any other person interviewed on the matters pertinent to the inspection/investigation, and the documents and things in support of the recommendations  and conclusions, all of which should be attached;
11.1.4     The  draft  Order,  for  the  signature  of  the  Regional  Officer,  which  shall likewise contain the pertinent facts and circumstances,  recommendations and conclusions, with the clear statement of the dispositive portion.

11.2    Review.  The  Head  of the  Monitoring  or HOA  Unit  shall  review  the  NIR  or SIR, including all attached documents, and, within five (5) working days, either -

11.2.1     Approve  the  recommendations   provided  in  the  NIR  or  SIR,  including either  the  endorsement  of  the  draft  Order  or  draft  a  new  Order,  if he disagrees or wishes to supplements the former, for the signature of the Regional Officer.
11.2.2     Qualifiedly approve the conclusions of the NIR or SIR, annotating thereon the corrections  deemed necessary,  as well as draft a different Order, for the signature of the Regional Officer, providing for the corrections.
11.2.3     Disapprove  the recommendations  and conclusions  of the NIR or SIR and
state the facts as borne by the records, documents  and things on record and   the   recommendations    and   conclusions   which   may   be   culled therefrom, including the preparation  of new Order for the signature of the Regional Officer.

11.3    Order. The Regional Officer shall evaluate the NIR or SIR within ten (10) working days from receipt thereof. If the Regional Officer agrees with the conclusions of the NIR/SIR or, if to the contrary, the Head of the Monitoring or HOA units, he/she shall sign  the  appropriate  draft  Order,  either  closing  the  proceedings  or directing  the issuance  of the Notice  of Reported  Alleged  Violation  (NORA  V). If the Regional Officer disagrees with both or determines that the draft Order or Notice is defective, he/she shall prepare  a new Order and/or Notice, and return the same to the unit from whence the inspection or investigation originated.

11.4   Reconsideration. In case the Regional Officer determines that no violation was committed, the person initiating the inspection/investigation or the Inspector/Investigator, or the Head of the Monitoring or HOA Divisions, may seek reconsideration  of the Order to the Regional  Officer  within fifteen  (15) days from receipt  of  the  order  of  dismissal.  The  Order  denying  reconsideration   may  be appealed to the Board of Commissioners  within fifteen (15) days from denial of the plea for reconsideration.

Section  12.  Notice  of  Reported  Alleged  Violation.  -  If  the  Regional  Officer,  upon evaluation of the NIR or SIR, determines that there is a violation of existing laws, rules and regulations,  decisions,  awards or orders, the NORAV shall be issued stating the findings of fact, the nature of the violation/s, and the act or acts required to be done or undone, attaching therewith any document/s or things in support thereof.

The NORAV shall be furnished the respondent  within a period of ten (10) days from its issuance.  If the investigation  was initiated  by the complaint  of a third party, the latter shall be entitled to copies of the Inspection/investigation Report, and the NORAV.

Section 13. Comment. - The NORAV shall include an order directing the respondent to comment  thereon  within a period of ten (10) days from receipt thereof.  The Regional Officer may resolve the matter on the basis of the documents on record within a period of fifteen  (15) working  days from receipt  of the comment  or the lapse of the period  within which the said comment ought to have been submitted.

Section   14.  Clarificatory   Conference/Joint   Ocular   Inspection.   -  If  it  has  been determined that there are matters to be clarified, the Regional Officer or the authorized inspector/investigator shall schedule, within a period of five (5) working days from receipt of the comment, either or both of the following:

14.1    Clarificatory Conference. Questions may be propounded to the parties or any other person  invited  to  the  conference  for  the  purpose  of  clarifying  certain  specific matters, which must be stated in the order directing the conduct of the conference, to obtain a judicious evaluation of the evidence.

14.2    Ocular Inspection. The inspection shall be conducted with prior written notice to the
parties  requesting  their  participation  or  their  expert  witnesses  on  matters  which may require technical evaluation and/or the confirmation of facts alleged in the NIR or SIR, the NORAV and the reply thereto.

Section   15.  Issuance   of  Order,   Award   or  Resolution.   -  In  case  the  facts  or conclusions   are  contested,  the  Regional  Officer  shall  resolve  the  dispute  under  the following procedure:

15.1    Recommendation.  The Inspector/investigator assigned to conduct the proceedings shall draft an Order, within a period of ten (10) working days from the termination of the  proceedings,  stating  the  findings  of  fact,  the  issues  for  resolution  and  the grounds  upon which the recommendation  are based, which shall either terminate any further proceedings or impose sanctions or penalties, and/or command the commission or omission acts.
15.2    Recommending  Approval. The draft Order shall be submitted to the Head of either the Monitoring or Association  Divisions who shall have a period of five (5) working days within which to approve  or disapprove  the recommended  draft Order. In the event  of  disapproval,   the  Head  shall  draft  a  separate  Order  contrary  to  that prepared by the Inspector/Investigator.
15.3    Resolution.  The Regional  Officer  shall,  within  five (5) working  days from receipt, either approve or disapprove  the draft Order, or choose between which of the two (2) draft Orders will be approved, or draft a new Order stating the findings of fact, the issues resolved and the basis for the resolution.

Section 16. Order. -

16.1    Contents.

16.1.1     The Order shall be in letter form addressed to the respondent/s  providing for  a  brief   summary   of  the  proceedings   conducted,   the  facts   and conclusions adduced and the disposition of the matter;

16.1.2     If penalties are imposed, the Order shall also state if there are mitigating,
aggravating   or  alternative   circumstances   provided   that,  in  case  the complaint  was  instigated  by a private  complainant,  he/she  shall  not be entitled to damages.

16.2    Notice. Within five (5) working days from the resolution  of the case, the Regional Officer shall cause, through  whatever  means available  and expeditious, furnish a copy of the order to the parties.

16.3    Reconsideration.  No motion for reconsideration  shall be entertained  and any such motion filed shall not toll the period within which to appeal.

Section  17.  Application  of  HLURB  Rules  of  Procedure.  -  The  HLURB  Rules  of
Procedure shall be applied in all appeals before the Board of Commissioners.

Section 18. Modes of Review.  - The orders and resolutions  of the Regional  Officer may be reviewed as follows:

18.1    Ordinary  Appeal.  The final orders  and resolutions  of the Regional  Officer,  in the exercise of his/her regulatory jurisdiction may be appealed to the Board of Commissioners  within fifteen (15) days from receipt thereof by the aggrieved party.

18.2     Appeal by Petition for Review.

18.2.1     The issuance of a cease and desist order may be the subject of an appeal by  way  of a petition  for  review  filed  with  the  Board  of Commissioners within  fifteen  (15)  days  from  receipt  of  the  said  interlocutory  order  or cease and desist order.
18.2.2     Appeals  from  the  acts  of  the  local  and  regional  planning  and  zoning bodies may be revisited by the Board of Commissioners  upon petition for review filed by the aggrieved party within a period of fifteen (15) days from receipt of the order or resolution. The appeal memorandum  shall be filed with  the  Regional  Arbiter  who  shall  be  responsible   for  receipt  of  all pleadings,  documents  and things, which shall be forwarded  to the Board of Commissioners upon completion thereof, with a brief summary of the proceedings undertaken and the contents/facts adduced.

Section 19. Final Orders. Decisions or Judgments.  - Orders, decisions or judgments shall be final and executory under the following circumstances:

19.1    Regional  Officer.  If no  appeal  has  been  filed  with  the  Board  of Commissioners within fifteen (15) days from receipt of the appealed order or the order denying its reconsideration.
19.2    Board  of Commissioners.  If no  motion  for  reconsideration  has  been  filed  within fifteen  (15) days from receipt  of the judgment  or, upon denial  of the motion,  the party fails to appeal, within the same period, to the Office of the President in case of  real  estate   development   cases   or  to  the  Court   of  Appeals,   in  case   of homeowners association cases.
19.3    Office of the President.  If no appeal is filed from the judgment of the Office of the President  or, if an appeal  has  been  filed,  the  appealed  judgment  has  not  been further appealed to the Court of Appeals within the period as mandated  under the Rules of the Office of the President.
19.4    Court  of  Appeals.  If  no  petition  for  the  review  of  the  decision  of  the  Court  of Appeals is elevated to the Supreme Court within the period and in accordance with the procedure as stated in the Rules of Court.
19.5     Supreme Court. The final judgments, orders or resolutions of the Supreme Court.

Section 20. Execution. - In cases where the order or resolution has become final and executory  under  any  of  the  circumstances  as  aforementioned,   or  in  cases  where  the judgment may be executed pending appeal subject to the posting of a bond, the records of the case shall be returned to the Regional Office of origin. In such instances, the Regional

Officer shall endorse the case to the Regional Arbiter for the issuance of the order and writ of execution.


Section 21. Purpose. - The Regional Office shall conduct inspections/  investigations of real estate developments  regulated by the HLURB after six (6) months from the date of the issuance of locational clearances and development permits, in cases where it is still authorized  to  issue,  certificates  of  registration  and  licenses  to  sell  for  the  purpose  of verifying  that  the  development/construction  of  the  project  is  in  accordance   with  the approved plans, the work schedule and compliance with the requirements:  Provided, That even before the said 6-month period, the Regional Office may conduct an inspection/investigation  upon  information   of  any  alleged  violation  of  the  laws,  rules, regulations and standards of the HLURB.

Section  22. Procedure.  - The conduct  of inspections  and investigations  shall be as follows:

22.1    Pre-Inspection/Pre-Investigation. The Inspector/investigator shall secure the written Authority  of  the  Regional  Officer  to  conduct  inspection/  investigation  and  shall secure from the Records Section the list of projects issued locational clearances, development permits, certificates of registration and licenses to sell, or those where reported violations have been committed.

22.2    Notice. The Inspector/investigator shall notify the owner/developer  of the conduct of the site inspection/investigation and may require the submission of additional documents  necessary  for  the  conduct  of  the  inspection/  investigation   within  a period of five (5) days from receipt of the notice.

22.3    Site Inspection/Investigation. - The inspection/investigation shall be conducted  on the  date/s  as  stated  in  the  notice  sent  to  the  developer/  owner  and  shall  be completed  within  a  period  of  thirty  (30)  days  from  the  date  of  issuance  of  the Authority from the Regional Officer.

22.4    Post-Inspection/Investigation.  - The Inspector/investigator shall prepare  or cause to be prepared the SIR within a period of five (5) working days from the date of completion of the site inspection/investigation:

22.4.1     If the inspector/investigator finds that there is no violation committed,  the SIR shall be prepared recommending that the SIR be admitted into the records for records purposes only; or, if the project has been completed, the SIR shall recommend that the owner/developer  be required to procure from the Regional Office a Certificate of Completion; or
22.4.2     If   the   Inspector/investigator   determines   that   a   violation   has   been
committed,  the Inspector/Investigator shall prepare  the draft NORAV,  to be  signed  by  the  Regional   Officer,  stating  the  findings   of  fact,  the violations  of  the  law,  rules,  regulations   and  standards,  and  the  acts required to be done or undone.

22.5    Review  of  Site  Inspection  Report.  The  Head  of  the  Monitoring  Division  of  the Regional  Office  shall  review  the  SIR  and  the  attached  documents  thereto,  and, within a period of five (5) working days from receipt thereof, submit to the Regional Officer a recommendation: such approval or amend the draft Order of Termination  of Proceedings  or
the NORAV,  by citing additional  facts, as appearing  on the records, and the grounds for the proposed amendments; or,
22.5.2    Disapproving the proposed actions in the SIR either by recommending  the termination  of the proceedings  and drafting  the Order for such purpose, stating in the SIR the grounds for the recommendation;  or
22.5.3    Recommending  the issuance  of a NORAV,  and drafting  the said Notice for  the  signature  of  the  Regional  Officer,  and  stating  in  the  SIR  the grounds for the issuance of the said notice.

Section 23. Resolution.  - The Regional Officer shall act on the documents  reviewed by  the  Head  of  the  Monitoring  Division,  within  a period  of  five  (5)  working  days  from receipt thereof, either by terminating the proceedings or issuing a NORAV by -

23.1   Approval. Approving the recommendations  as stated in the SIR which has been recommended  for approval by the Head of the Monitoring Division; or
23.2    Disapproval.  Disapproving  the recommendations  as stated  in the SIR which  has been  recommended   for  approval  by  the  Head  of  the  Monitoring  Division  and annotating or attaching to the SIR the contrary findings of fact or grounds for the disapproval; or
23.3    Conflicting  Recommendations. In case of conflicting  recommendations,  approving either of the recommendations  of the Inspector/ Investigator or the Head of the Monitoring Division.


Section 24. Application. - The procedure through which the issue of which of two (2) or more homeowners associations existing within the same or substantially the same area of  the  subdivision   or  condominium,   shall  be  certified  is  applicable   to  the  following situations:

24.1     One of the associations is registered with the SEC and another with the HGC;
24.2     One of the associations is registered with either the Securities and Exchange or the
HGC, and the other with the HLURB; or
24.3     Both or all the associations are registered with the HLURB.

Section 25. Procedure. - The procedure for adjudicatory mechanism is as follows:

25.1    Preliminary  Conference.  Upon receipt of a complaint  or information  that there are two  or more  Associations  existing  in the  same  subdivision  or condominium,  the Regional Office shall call the parties to a mediation conference for the purpose of reaching  an amicable  settlement  of the controversy,  the minimum  requirement  of which   is  that  only  one  of  the  claimants   shall  be  allowed   to  represent   the homeowners thereof.

25.2    Confirmation   of  Legal  Existence.   In  the  event  that  the  dispute  is  not  settled amicably,  the Regional  Office shall conduct  a non-field  investigation  to determine the legal existence of the contending associations by -

25.2.1     Procuring  from either the SEC or the HGC the registration  documents  of the involved  Association,  if any one of them  claims  to be so registered with either government agency;
25.2.2     Retrieving from the records the registration  documents  of any of the said
Associations claiming ascendancy in the subdivision or condominium;
25.2.3     If,  in  the  course  of  the  investigation,  it  has  been  determined  that  the certificate  of  registration   of  one  or  more  of  the  claimants  has  been revoked, or does not exist, an Order shall issue confirming the authority of the legitimate Association over the subdivision or condominium.

25.3    Conference.  If the legal existence  of the Associations  is confirmed,  the Regional Officer  shall issue a notice  to the parties  to be present  at the conference,  which should not be more than fifteen (15) days after the conclusion of the non-field investigation,  requiring  the  parties  to submit  the  names,  addresses  and  contact numbers of their members.

During the conference, the parties shall be asked to make a final effort at reaching an amicable settlement. Failing that, the parties shall be required to submit their comment to the list of members submitted by the other party within a period of ten (10) days from the date of the last hearing

25.4    Membership  confirmation.  The  Regional  Office  shall,  within  a period  of ten  (10) days from its commencement,  conduct a survey for the purpose of confirming  the claims   of  membership   by  the  parties.   Thereafter,   a  written   report   shall   be submitted,  within five (5) working days after completion  of the survey, to the Head of the  HOA  Unit,  who  shall,  in turn,  submit  a recommendation  to the  Regional* Officer within a period of five (5) working days from receipt of the survey report.

25.5    Factors. In the determination  of which Association  will be accredited,  the following factors shall be considered:

25.5.1     The date of registration;
25.5.2     The number of members;
25.5.3     The financial viability of the Association; and,
25.5.4     The history of governance (or non-governance).

Section  26. Order. - Upon receipt  of the recommendation  of the Head of the HOA Unit, the Regional Officer shall issue an Order, as follows:

26.1     Recognition.

26.1.1     If it is clear after a review of the records and documentary  evidence,  as well as the recommendations  of the HOA inspector/investigator that one of the associations  has a clear right to represent the homeowners  of the subdivision  or  condominium,  the  Order  to  be  signed  by  the  Regional Officer shall state which of the associations shall be accredited.
26.1.2     If there is no clear ascendant association the Regional Officer shall order
the conduct of a referendum among the homeowners and certify the association   which  has  received   the  most  number   of  votes   as  the authorized association representing the homeowners of the subdivision or condominium.

26.2    Effects. The association  accredited  shall be authorized  to exercise  the rights and perform the duties and responsibilities  of a HOA in the subdivision or condominium. Although its registration shall not be revoked, the defeated association shall not be allowed  to be  registered  with  the  HLURB  and,  additionally,  shall  be  directed  to refrain from exercising  the rights and performing  the duties and responsibilities  of an accredited Association in the subdivision or condominium.

If the by-laws of the accredited association require all homeowners to be members, the members of the other HOAs shall be required to register as members of the accredited Association.

Section 27. Procedure. - The rights of a homeowner to inspect association books and records and/or to be furnished with financial statements and reports may be enforced as follows:

27.1     Petition.  A  homeowner   or  group  of  homeowners   may  file  a  petition  with  the
Regional Office that -

27.1.1    He/she is a homeowner of the subdivision or condominium of which the Association  is the duly accredited  HOA  and has paid his/her  dues  and other assessments;
27.1.2     He/she has previously  demanded  for the inspection  and photocopying  of books and records and/or to be furnished with financial statements;
27.1.3     The Association,  through its authorized  officer/s has refused to grant the said demands;
27.1.4     The refusal of the Association to grant the demands of the complainant is
unjustified  and  illegal,  stating  the  law  and/or  jurisprudence  in  support thereof; and,
27.1.5     The  letter  of  demand  and  the  answer  thereto,  if  any,  and  such  other documents and affidavits which would tend to prove the allegations stated in the petition shall be attached thereto.

27.2    Notice  of  Conference.   If  the  petition  is  sufficient  in  form  and  substance,   the Regional  Officer  shall  set  the  conference  not  later  than  twenty  (20)  days  from receipt of the petition and shall duly notify the parties by written notice thereof and directing the Association  to answer the petition within ten (10) days from receipt of the said notice.

27.3    Answer. The answer of the Association  duly furnished the complainant,  shall state the following:

27.3.1     The grounds for the refusal of the respondent to grant the demands of the complainant;
27.3.2     The conditions or limitations on the exercise of the right to inspect, which should be imposed by the Arbiter, if the right to inspect is granted;
27.3.3     The cost of inspection,  including manpower  and photocopying  expenses, if the  right  to  inspect  and  to  be  furnished  copies  of  the  documents  is granted; and,
27.3.4     The affidavits  of witnesses  and any other  documentary  evidence  which would tend to disprove the material allegations of the petition.

27.4    Conference. On the date set for the conference, the Regional Officer shall render judgment if, as of that date, the Association has not filed its Answer. Otherwise, the Regional  Officer  shall attempt  to mediate  the dispute,  failing which,  the Regional Officer shall inform the parties that the petition is deemed submitted for resolution.

Section  28. Decision.  - The Regional  Officer, or his duly authorized  representative, shall  render  a  decision   based  on  the  pleadings,   affidavits,   documentary   and  other evidence  attached  thereto  within  thirty  (30)  days  from  the  date  of  the  conference.  A decision  ordering  the respondent  to allow the inspection  of books and records and/or to furnish copies thereof shall also order the complainant to deposit the estimated cost of the manpower to be engaged to produce the books and records and the cost of copying, and state, in clear and categorical  terms, the limitations  and conditions  to the exercise of the right allowed or enforced.


Section  29. Nature  of proceedings.  - The proceedings  for the removal  of directors and the dissolution  of the Board as provided in the succeeding  Sections under this Rule are administrative  and non-adversarial  in nature and the order granting  or denying  such removal shall be directly appealable to the Board of Commissioners.

Whenever  the petition for the removal of director(s)  shall result in the absence  of a quorum  for the Board  to legally  conduct  business,  the action  shall be considered  as a petition   for  the  dissolution   of  the  Board  and  shall  be  considered   and  resolved   in accordance with the procedure for such dissolution.

The  petition  for the  removal  of director(s)  or for the  dissolution  of the  Board  filed within  the period  of three  (3) months  before  the expiration  of the term  of office  of the director(s)  or the Board shall be dismissed,  without prejudice to the right of the petitioner to invoke the adjudicatory jurisdiction of the HLURB.

Section 30. Petition. - The proceedings  for the removal of a director is commenced by  the  filing  of  a  letter  petition  with  the  Regional  Office  having  jurisdiction  over  the Association as follows:

30.1     Contents.

30.1.1     The  name/s  of  the  director(s)  sought  to  be  removed,  their  addresses, positions if also officers, date of election and expiration of term of office;
30.1.2     The acts committed  which would constitute  a violation  of the laws, rules and regulations, and the By-laws resulting in the loss of confidence in the director(s) sought to be removed from office;
30.1.3     Signature  of  at  least  five  (5)  members  in  good  standing  seeking  the removal of the director(s);
30.1.4     Verification by the signatories before a duly authorized notary public;

30.2     Supporting Documents

30.2.1     The list of members and their signatures, with proof of their signatures as appearing in any government-issued document,  and collectively  attesting that they are all members in good standing, and that they are joining the petitioners as co-petitioners to remove the director(s);
30.2.2     The list of members  in good standing of the association,  their addresses and contact  numbers,  as attested  by the Secretary  or Treasurer  and, if both  refuse  to  certify  thereto,   the  sworn  statement   of  any  member describing the circumstances  of his/her knowledge of the list, certifying to its  truthfulness   and  stating  the  reasons  for  the  failure  to  obtain  the required certification;
30.2.3     Any other  document  which  would  support  the substantial  allegations  of
the petition; and
30.2.4     Proof   of  service   of  the  letter   petition,   and  its  attachments,   to  the director(s) sought to be removed.

Section  31. Initial  Evaluation.  - Upon  filing  and  payment  of the required  fees,  the Regional Office shall evaluate the petition for sufficiency in form and substance, and make a determination, within ten (10) days from the filing thereof, as follows:

31.1     Formal Requirements.  The petition contains all the necessary formalities as stated in the preceding subsection.

31.2     Substantial Requirements.

31.2.1     The  petitioners,  including  those  members  in  good  standing  who  have joined them, constitute a simple majority of the total number of members in good standing based on the certified list of members in good standing of the association; and,

31.2.2    The   alleged   ground(s)   for   which   the   removal   is   sought   constitute violation(s)  of the laws, rules and regulations,  and the provisions  of the By-laws, and are substantial  enough to cause the removal from office of the director(s).

Section  32.  Conference.  -  If  the  petition  is  sufficient  in  form  and  substance,  the
Regional Office shall conduct a conference as follows:

32.1    Notice.   Notice   shall   be  sent   to  the   parties,   within   five   (5)  days   from   the determination of sufficiency in form and substance, stating the following:

32.1.1     The date, time and place of the conference, which is not transferable;
32.1.2     The director(s)  sought to be removed  may submit a reply to the petition which should not be later than two (2) working days before the date of the conference;
32.1.3     The possibility of reaching an amicable settlement;
32.1.4     The  submission   of  evidence,   documentary   or  testimonial   by  way  of affidavits, to prove or contest the allegations stated in the petition;
32.1.5     The  instruction  that  the  parties  should  be personally  present  without  a lawyer unless the parties themselves are lawyers by profession; and,
32.1.6     There shall be no continuances  and all matters shall be resolved  on the date of the conference.

32.2    Manner of Conduct. The conference  shall be conducted  in a non-litigious  manner, giving both parties equal opportunity to present their causes: for the petitioners, the truthfulness  of the allegations of the petition, and for the director(s), their defenses which is limited to the frivolous or simulated nature of the offenses charged and/or that the signatories  to the petition  do not constitute  a simple majority  of the total number of members in good standing.

Section 33. Re-evaluation.  - The Regional Officer shall, within five (5) calendar days from the termination of the conference, issue an Order ruling that -

33.1    Dismissal.  The  petition  is dismissed  for the failure  of the petitioner  to prove,  by prima facie evidence, the cause(s) alleged or that the petitioners do not constitute a simple majority of all the members in good standing of the association; or,

33.2    Due  course.   The  petition   shall  proceed   as  the  petitioners   have  proven   the sufficiency of the petition in form and substance and sending a notice to all parties that  the  Regional  Office  shall  verify  the  identity  and  validate  the  signatures  as appearing on the petition and its attached documents on the dates set therein.

33.3     Verification and Validation.

33.3.1     On the dates set in the notice, the Regional Office shall proceed to verify the identity of the .signatories and validate the authenticity thereof through whatever legal and technological means available.
33.3.2     The  Report,  submitted  to the  Regional  Officer,  within  five  (5)  calendar
days from the completion  of the validation and authentication,  shall state the circumstances  through  which  the said  validation  and  authentication has been conducted,  and recommend  either the dismissal of the petition for  failing  to  have  sufficient  signatories  consenting  to  the  removal  or propose the removal of the director(s) as a consequence of the consent of a simple majority of the members.

Section 34. Order. - Within five (5) working days from the submission  of the Report, the Regional Officer shall issue an Order:

34.1    Dismissal. Dismissing the petition if the petitioners failed to obtain the consent of a simple majority of all members of the association for the removal of the director(s); or,
34.2    Approval.  Sustaining  the  petition  by  removing  the  director/s  and  directing  the remaining members of the Board to conduct an election to replace the removed director/s,  who,  in  turn,  shall  only  serve  the  unexpired   term  of  the  removed director(s).


Section 35. Dissolution.  - The Board may be dissolved under the following circumstances:

35.1    Automatic.  The Board is deemed dissolved when, after the resignation  or removal of any director/s, the remaining members no longer constitute a quorum by way of a verified petition filed by any member.
35.2    By petition.  The  dissolution  of the  Board  may  be commenced  by the  filing  of a verified petition of at least five (5) members  of the association,  and supported  by the signatures of at least two-thirds of all members in good standing as certified by the Secretary,  or if he/she  refuses  to so certify,  by a member  in good  standing stating in the certification/affidavit such fact of refusal and the circumstances  under which he/she has acquired custody of a copy of the master list of members.

Section 36. Procedure. - The formal and substantial requirements of the petition to remove director/s  as well as the procedure  thereof shall be applicable  to the petition for the dissolution of the board.

Section 37. Decision. - The Regional Officer shall issue an Order within a period of fifteen (15) days from completion of all proceedings as follows:

37.1    Resolution. If the petitioner has failed to prove the reasons for the dissolution of the Board,  the  Regional  Officer  shall  order  the  dismissal  of the  petition.  Otherwise, he/she shall order the dissolution of the Board upon a finding that there is cause therefor.
37.2    Special  Election.  The  Regional  Officer  shall  immediately  call  for  the  conduct  of special elections  to elect the members  of the replacement  Board which shall only serve the unexpired portion thereof.
37.3    Interim  Board.  The  Regional  Officer  shall  likewise  appoint  the  members  of  the interim  Board  who  shall  hold  office  until  the  new  Board  has  been  elected  and qualified:  Provided,  That  the  interim  Board  shall  only  function  to insure  that  the basic services are provided the members and the performance of the day-to-day operations   of  the   association:   Provided,   further,   That   such   Board   shall   be composed  of association  members*  in good standing:  and, Provided  additionally, That such interim directors shall not be eligible to run in the election called for the purpose  of replacing  the members  of the dissolved  board;  and, Provided,  finally, That  the  Interim  Board  is  automatically   dissolved   upon  the  qualification   and assumption into office of the newly elected Board.

Section 38. Causes. - The Regional Office may conduct supervised  elections under any of the following circumstances:

38.1    When the conduct of the elections was decreed pursuant to a decision or order in a case pending or resolved by the Arbiter, the Board of Commissioners,  the Court of Appeals, or the Supreme Court;

38.2    When  it  has  been  discovered,  in  the  course  of  non-field  monitoring,  that  the association has not conducted the elections as mandated in the by-laws;
38.3    When  a  petition  is  filed  requesting  for  the  conduct  of  supervised  elections  for causes which may give rise or had given rise to the failure of elections.

Section  39. Procedure.  - When  the  request  for supervised  elections  is by way  of petition, the following procedure shall be followed:

39.1    Petition. The petition shall be filed with the Regional Office having jurisdiction over the  association  and  shall  state  the  material  circumstances   of  the  parties,  the reasons for the conduct of the supervised  elections,  the name of the nominee  for the Special Elections Committee in the event that the petition is granted, and the payment  of  the  corresponding   fees  which  shall  cover  the  costs  of  service  of pleadings and the conduct of the investigations.

39.2    Reply. If the petition is sufficient  in form and substance,  the Regional  Office shall issue a notice to the respondent(s) and order that a reply be filed within three (3) working days from receipt thereof, and likewise require the respondent to nominate its representative  to the Special Elections Committee  in the event that the petition is granted.

The Regional Officer shall resolve the issue within a period of five (5) working days from  receipt  of the  reply  or  the  lapse  of the  period  within  which  the  said  reply should have been filed.

If the Regional Officer finds no merit in the petition, he/she shall issue an Order dismissing the petition.

39.3    Preliminary  Order. In the event that the Regional Officer finds merit to the petition, he/she shall issue a preliminary order stating that -

39.3.1     An investigation  has been  conducted  on the material  allegations  of the petition  and the reply,  and that there is a well-grounded  fear that there may be a failure of elections;

39.3.2. The parties shall deposit the amount as stated in the Order within a period of ten (10) days from receipt thereof, to answer for the expenses incident to the conduct  of the elections  and  all activities  in its preparation.  The failure  of both  parties  to deposit  their  share  in the stated  amount  shall result in the dismissal of the petition. In case only one party fails, and the other complies with the order, the non-compliant party shall not be entitled to a representative to the Special Elections Committee;

39.3.3     The Regional Officer shall order the conduct of the petitioned supervised
elections. The petitioner shall pay the election fees which shall cover the pre-election,  election  and  post-election  of the  Regional  Office  in conducting  the  supervised  elections,  subject  to  reimbursement   by  the HOA.  In the  meantime,  the  Regional  Officer  may  issue  such  orders  to protect the interests of the parties.

39.4    Order. Upon payment  of the election  expenses,  the Regional  Officer  shall create and name the Special Elections Committee and charge them with the duty of supervising   the  pre-elections,   elections   and  post-elections   activities,   with  the instruction that the entire election process be completed within a period of sixty (60) days from the date of the convening of the Special Election Committee.

Section  40.  Special  Elections  Committee.  -  The  Regional  Officer  shall  create  a Special  Elections  Committee  which  shall  be responsible  for the  conduct  of the  special elections under the following circumstances:

40.1    Composition.  The  Committee  shall  be composed  of five  (5) members:  three  (3) shall be officers of the HOA Unit of the Regional Office and one (1) each from the contending  parties.  If  there  are  more  than  two  contending  parties,  the representatives   of  the  HOA  Unit  may  be  increased  so  that  they  shall  always constitute a majority of the members of the Committee.

40.2    Guidelines. The Committee shall formulate the Special Elections Guidelines, which, as  much  as  possible,  should  adhere  closely  to  the  election  practices  of  the association and shall contain the following provisions:

40.2.1     The powers and duties of the Committee;
40.2.2     The  issuance  of  the  Certificates  of  Candidacy  and  the  proxy  forms,  if allowed by the By-laws;
40.2.3     Provide  for the date and time of postings,  filing,  and submission  of the master list of the members qualified to vote, the certificates of candidacy, and the proxy forms if allowed by the Bylaws;
40.2.4     The manner by which voters are qualified or disqualified,  and pass upon the qualifications and disqualifications  of candidates;
40.2.5     Rules on Campaigning;
40.2.6     Prohibited acts of voters and candidates;
40.2.7     Proclamation and Oath of Office of winning candidates; and,
40.2.8     Such other matters as may aid in the peaceful and orderly conduct of the elections

Section  41.  Election  Procedure.  -  Within  five  (5)  days  from  the  payment  of  the election fees, the Regional Officer shall immediately  designate the chair of the committee supervising   the   elections   and   the   two   other   members   as   well   as   appoint   the representatives  of the contending parties as provided herein.

41.1     Pre-Election. The Committee shall perform its pre-election duties as follows:

41.1.1     Set the date, time and place of the elections, which shall not be more than sixty (60) days from the date of the notice;
41.1.2     Personally serve or send by registered mail the notice to all the members, and  post  a  copy  thereof  in  three  (3)  conspicuous   places  within  the territorial jurisdiction of the association,  containing: (a) the time, date and place of the special elections; (b) the period and place for the submission of any petition to include or exclude voters; and, (c) the period for the submission  of certificates  of candidacy and proxies, if allowed by the By- laws;
41.1.3     Deliberate on and adopt the draft Election Guidelines which shall likewise
be posted in three (3) conspicuous places in the subdivision/village  or condominium.

41.1.4    In the meantime, the Committee shall direct the representatives of the contending parties to submit their list of qualified voters and conduct the reconciliation  thereof.  If no agreement  is reached,  the Committee  shall vote thereon, stating the reasons for the exclusion;
41.1.5     The   Committee   shall   post   the   master   list   of   voters   in   three   (3)
conspicuous places in the subdivision/village  or condominium, where applicable. The members shall have seven (7) working days within which to petition the Committee to include or exclude voters;
41.1.6     After the period for challenging the qualifications  of voters, the Committee shall  resolve  all petitions  within  three  (3) days.  The  final  master  list of voters shall be posted in three (3) conspicuous places within the subdivision/village  or condominium;

41.1.7     The Committee  shall likewise  accept certificates  of candidacy  within the period as stated in the Guidelines  and allow any member, within two (2) days from posting, to petition for the disqualification  of any candidate; Committee  shall  post the final list of candidates  for the positions  to be elected  in  three  (3)  conspicuous  places,  apart  from  the  venue  of  the prospective elections;

41.1.9    The campaign period shall commence immediately after the posting of the
list of official candidates  but in no case shall be more than fourteen (14) calendar  days  from  the date  of the election  and shall  end one (1) day before the election.

41.2    Elections.   The   Committee   shall   supervise   all  activities   during   the  elections, including  the  registration   of  voters,  counting  and  casting  of  ballots,  tally  and tabulation of votes, and hear and act upon election protests.

41.2.1     Each  member  shall  be  entitled  to  only  one  (1)  vote  regardless  of  the number of properties owned;
41.2.2     In  the  event  of  tie  among  candidates,  the  Committee  shall  review  the ballots  and determine  with certainty  the existence  of a tie. If confirmed, the  dispute   shall  be  resolved   through   toss  coin  with  the  candidate correctly calling the toss as winner;
41.2.3     Upon proclamation,  the Chair of the Committee  shall forthwith administer the oath of office to the winning candidates,  who shall immediately  meet for the purpose of organizing the Board.

41.3    Post-Election.  The Committee  shall, within  a period  of fifteen  (15) days after the elections,  submit  to the Regional  Office  the Special  Election  Report,  which  shall provide for the following:

41.3.1     Pre-Election   Activities  which  shall  provide  a  narrative  of  pre-election activities undertaken  by the Committee  and attaching thereto the notices sent to members of the date and time of the Elections, the Minutes of Meetings,   the  Election   Rules,   the  Final  List  of  Eligible   Voters   and Candidates,  and such other information  or document as may be deemed relevant and necessary.
41.3.2     Election  Activities  which  state the date and time of the commencement
and end of the election, the number of qualified  voters, number of votes cast and the number  of votes received  by the candidates,  and all other matters which occurred in the course of the elections, and documents pertaining to the Minutes of the Elections, the list of voters with their corresponding  signatures,  the certified  election  returns  and any protests filed,  and  such  other  documents   as  may  be  deemed   relevant   and necessary.
41.3.3     Post-Election  Activities  which shall be a narrative  of any other activities
conducted after the counting of ballots, including the filing of any protest registered on the day of election and the resolution thereof, the names of the candidates proclaimed as winners and whether they have been administered    the   oath   of   office,   and   such   other   documents   and information as may have been generated or are deemed significant in the course of the post-election activities;

Section  42. Hold-Over.  - Where  there  is failure  to elect  a new  set of directors  or officers, the incumbent directors shall be allowed to continue in a hold-over capacity until their successors  are duly elected and qualified: Provided,  That special elections shall be called within a period of thirty (30) days from the date when the cause for the failure of elections has ended; and, Provided further, That, in the event the holdover officers fail to call for the elections, the Regional Office shall conduct the elections.

Section  43.  Election  Contests.  -  In  case  the  elections  were  supervised  by  the Regional   Office,  the  election   contest  shall  be  filed  as  an  appeal  to  the  Board  of Commissioners.

Section 44. Turnover of Records and Properties by Outgoing Directors/ Officers. - To ensure the orderly turnover of the management  of an association,  the outgoing directors and officers of an association shall turn over all association books, records, properties and other assets, to the new set of directors and officers within fifteen (15) days from the proclamation  of the new Board.  The refusal  or unreasonable  failure  to comply  with this provision shall constitute a ground for contempt and fine imposed on the erring officers at the rate of P500.00  per day reckoned  from the last day for the turn-over  thereof,  apart from such other penalties which may be imposed by law.


Section 45. Management Committee. -

45.1    Creation.  The  Regional  Officer  having  jurisdiction  over  the  case  may,  upon  a verified petition or motion by any of the parties, create a management  committee for the Association  to carry out the day-to-day operations of the association  until a new set of officers is elected. The members of the management committee are considered agents of the HLURB and shall be under the control and supervision of the Regional Officer.

45.2    Composition. The committee shall be composed of at least three (3) members, one each   nominated   by   the   parties   and   the   third   by   the   Arbiter   or   Board   of Commissioners  from a list of nominees  submitted  by the parties. In the event that one or both parties fail or refuse to nominate a member, the Arbiter or Board of Commissioners shall appoint such member or members. The members of the management   committee  shall  not  be  eligible  to  run  in  the  next  election.  The Committee shall choose among themselves who shall act as the chairperson.

45.3    Grounds.  The  petition  shall  establish  that  there  is  no  other  adequate  remedy available and that the creation of the committee is necessary -

45.3.1     To  avert  dissipation,  loss,  wastage  or  destruction  of  assets  or  other properties of the association;
45.3.2     To  prevent  paralyzation  of  operations  which  may  be  prejudicial  to  the interest of the members and the general public; or,
45.3.3     When the election  of the incumbent  officers has been declared  null and void  and  the  hold-over  of  the  previous  board  shall  frustrate  or  render nugatory the invalidation of the election.

Section 46. Actions by Management Committee. -

46.1    Quorum.  A  majority  of  the  members  of  the  Management   Committee  shall  be necessary  for the management  committee  to act or decide on any matter, subject to the ratification of the Regional Officer or his/her duly authorized representative.
46.2    Reimbursement  of Expenses. The management  committee and persons hired by it shall be entitled to reimbursement of reasonable expenses, as approved by the Regional Officer, Board of Commissioners  or its authorized  representative,  as the case  may  be,  which  shall  be  considered   as  administrative   expenses  of,  and shouldered by, the Association.
46.3     Immunity from Suit. The members of the management  committee and the persons
employed  by it shall not be subject to any action, claim or demand  in connection with  any  act  done  or  committed  by  them  in  good  faith  in  the  exercise  of  their functions and powers.
46.4    Reports.  - Within  a period  of thirty  (30)  days  from  their  appointment  and  every month thereafter, the members the management committee shall submit a report to the Arbiter,  Board of Commissioners  or its duly authorized  representative,  as the case may be, on the state and condition of the association under management.

Section 47. Discharge of the Management Committee. - The management committee shall be deemed discharged and dissolved under the following circumstances:

47.1    Whenever  the Regional  Officer or his/her authorized  representative,  on motion or motu proprio, has determined that the necessity for the management  committee no longer exists; or,
47.2     Upon termination  or final disposition of the proceedings,  including the election and
qualification of a new board of directors and officers of the association.

Section 48. Report. - The management committee shall submit its final report, render an  accounting  of  the  management,   and  turn-over  all  the  records  and  assets  of  the association   to  the  duly  qualified   officers   of  the  association,   upon  its  discharge   or dissolution, and within such reasonable time as the Regional Officer, the Board of Commissioners,  or their authorized representative,  may allow.


Section  49.  Divisible  Penalties.   -  If  the  penalty  imposed   has  a  minimum   and maximum amount or period, the penalty shall be divided as follows:

49.1     Division. The divisible penalty shall be divided into two as follows:

49.1.1     Minimum  Degree.  The imposable  penalty shall be within the range from the minimum provided by law and one peso or month before the median amount or period;
49.1.2     Medium Degree. The middle amount or period between the minimum and maximum provided by law;
49.1.3     Maximum  Degree.  The  amount  or period  one  peso  or month  after  the medium degree up to the maximum amount or period provided by law.

49.2     Imposition of Penalties.

49.2.1     Minimum  Degree.  When  only one mitigating  circumstance  is present  or there is at least one mitigating circumstance more than aggravating circumstances, the imposable penalty shall be the median between the minimum and maximum penalty within the degree: Provided, That if there are two or more mitigating circumstances,  the penalty to be imposed shall be the minimum as provided by law.
49.2     Medium   Degree.   When  there  are  neither  aggravating   nor  mitigating
circumstances  or there is an equal number of mitigating and aggravating circumstances.
49.3        Maximum  Degree. When only an aggravating  circumstance  is present or there are more aggravating  than mitigating circumstances,  the imposable penalty shall be the median between the minimum within the degree and maximum imposable penalty: Provided, That, if there are two or more aggravating   circumstances,   the  penalty   to  be  imposed   shall  be  the maximum penalty as provided by law.

Section  50.  Qualified  Penalties.  -  When  the  law,  rule  or  regulation  sets  either  a minimum but not a maximum, or a maximum without a minimum amount or period, the penalties to be imposed are, as follows:

50.1    When the law, rule or regulation uses the words œnot more than  or terms of similar import, the minimum imposable penalty shall be the median between the maximum as provided  by law and zero penalty.  Thereafter,  the imposable  penalty  shall be divided  into  minimum,  medium  and  maximum  degrees  in  accordance  with  the preceding paragraph.

50.2    When the law, rule or regulation uses the words œnot less than  or terms of similar import, the minimum imposable penalty shall be that as provided by law and the maximum  being double  that amount  or period.  Thereafter,  the imposable  penalty shall be divided into minimum, medium and maximum degrees in accordance  with the preceding Section.

Section  51. Indivisible  Penalty.  - When the law, rule or regulation  sets the amount and/or period of the penalty without any qualifying terms to indicate whether the imposable penalty  may be more or less than that fixed therein,  then the HLURB  shall impose  the penalty provided regardless of the number and quality of the mitigating or aggravating circumstances.

Section 52. Circumstances  Affecting the Imposition of Penalties. - Upon the determination  that  an  offense  or  violation  has  been  committed,  the  following circumstances  shall be considered in the imposition of penalties:

52.1    Aggravating   Circumstances.   The   following   circumstances   shall   increase   the imposable penalty:

52.1.1     The violation or offense was committed through or was attended by fraud and/or deliberate and gross misrepresentation;
52.1.2     Lack of or suspended license to sell committed at the time of the violation or  while  a  cease  and  desist  order  is  subsisting,  without  prejudice  to separate proceedings for indirect contempt;
52.1.3     Commission of the same violation within the period of two (2) years;
52.1.4    Commission of a different violation within one year from the time of the commission of the cited offense or violation;
52.1.5    Commission of the same offense after the filing of the complaint or the monitoring/inspection activity but before determination  of the commission of the violation;
52.1.6     Pattern   of   misconduct   as   evidenced   by   the   number   of   violations committed within a period of five (5) years;

52.1.7     Submission of falsified or simulated documents;
52.1.8     Vulnerability of the victim;
52.1.9     Substantial  experience  or expertise in the real estate trade and the laws, rules and regulations pertinent thereto;
52.1.10   Disrespect  or discourteousness  towards  the officers of, and to the laws, rules and regulations implemented by the HLURB;
52.1.11   Such  other  circumstances  as would  tend  to prove  moral  depravity  and gross dishonesty.

52.2    Mitigating Circumstances.  The following circumstances  shall cause the decrease in the imposable penalty:

52.2.1     The absence of fraud and/or deliberate and gross misrepresentation;
52.2.2     The  absence  of  any  pattern  of  misconduct  or  the  violation  is  the  first offense;
52.2.3     Remoteness of previous offense or the offense committed was more than five (5) years from the last offense;
52.2.4     Timely good faith effort to rectify the alleged infraction or remunerate  the aggrieved party;
52.2.5     Imposition of other penalties;
52.2.6     Lack of experience or expertise in the real estate trade and the laws, rules and regulations pertinent thereto;
52.2.7     Such  other  circumstances  as  would  tend  to mitigate  the  effects  of the offense committed.

52.3     Alternative  Circumstances.  The  following  circumstances  shall  be  considered  as either aggravating or mitigating circumstances:

52.3.1     Financial capacity of the person penalized;
52.3.2     The aggregate amount of the project or transaction involved;
52.3.3     The education and reputation of the developer and/or the buyer
52.3.4     Such   other   circumstances    which   could   be   considered    as   either aggravating or mitigating circumstances.

52.4     Ineffectual  Circumstances.  The following circumstances  shall not be considered  in the imposition of penalties:

52.3.1     Forced or compelled restitution;
52.3.2     Agreeing to the demand of the client for the commission of the offense or violation of the laws, rules and regulations;
52.3.3     Withdrawal of the complaint by the complainant  if the action was initiated by a third party;
52.3.4     Withdrawal from the real estate business.

Section  53.  Computation  of  Penalties.  -  Whenever  the  laws,  rules  or  regulations penalizes  the  commission   or  omission  of  an  act,  the  commission   or  omission  shall constitute one violation and shall be penalized accordingly.

However, whenever the law, rule or regulation requires a license, each and every unit shall constitute a count for violation of the laws, rules and regulations.

Section 54. Effects of Reinterpretation.  - Except when the order imposing  penalties has become  final in whole or in part, the re-interpretation  of the provisions  of the laws, rules  and regulations  shall  have  prospective  effect  if detrimental  to the interests  of the person  sought  to be charged  but retroactive  if favorable  to the respondent.  In case the order imposing  sanctions  or penalties  has been appealed  in part and has become  final insofar as the other parts are concerned,  this Rule shall apply only to that portion of the order which has not yet become final and executory.


Section 55. Separability Clause. - If the effectivity of any provision of this Rule is suspended   or  disapproved,   or  otherwise   declared   contrary   to  law,   the  unaffected provisions shall remain in force.

Section  56. Repealing  Clause.  - Upon  the effectivity  of this Rules,  all resolutions, orders,  memoranda,  and  circulars  of  the  HLURB  which  are  inconsistent  herewith  are hereby repealed or modified accordingly.

Section 57. Effectivity. - This Rules shall take effect fifteen (15) days after publication in the Official Gazette.

APPROVED, this 27th day of November, Quezon City.

(SGD) EDUARDO DRUECO DEL ROSARIO HUDCC Chairperson
AUSTERE A. PANADERO Undersecretary,  DILG	(SGD) LLOYD CHRISTOPHER  A. LAO Chief Executive Officer and Commissioner
(SGD) ANTONIO T. KHO, JR. Undersecretary,  DOJ	(SGD) RIA CORAZON A. GOLEZ-CABRERA Commissioner
(SGD) DIMAS S. SOGUILON Undersecretary,  DPWH	(SGD) LUIS A. PAREDES Commissioner
(SGD) DANILO D. BARRAMEDA Director IV, NEDA	(SGD) MELZAR P. GALICIA Commissioner
Attested: (SGD) CHARITO B. LANSANG Board Secretary