FACTS
Petitioner Vivien M. Cadungog (developer/owner) and Respondent Sung Ha Jung (buyer) executed a Contract to Sell for a condominium unit priced at PHP 3,500,000.00. Jung paid PHP 3,241,050.00, leaving a balance of PHP 258,950.00. Cadungog refused to deliver the unit and title, citing the unpaid balance.
Jung filed a criminal case against Cadungog before the Regional Trial Court (RTC) for violation of Presidential Decree (P.D.) No. 957 (The Subdivision and Condominium Buyers’ Protective Decree).
The RTC acquitted Cadungog on reasonable doubt but proceeded to rule on the civil aspect ex contractu, giving Jung two options: (a) pay the balance and receive the unit; or (b) demand reimbursement of PHP 3,241,050.00 plus 12\% interest per annum. Jung chose reimbursement.
Cadungog challenged the RTC’s civil ruling via a Petition for Annulment of Judgment before the Court of Appeals (CA), asserting that the RTC lacked jurisdiction over claims arising from contracts between buyers and developers, which jurisdiction is exclusive to the HLURB (now HSAC) under P.D. No. 1344. The CA dismissed the petition.
ISSUES
– Did the RTC have jurisdiction to hear and decide the civil aspect of the criminal case, considering the civil liability adjudged arose from a contractual obligation (ex contractu) and not the crime itself (ex delicto)?
-Was a petition for annulment of judgment under Rule 47 the proper remedy to challenge the RTC’s decision regarding the civil liabilities of the parties?
RULING
The Supreme Court GRANTED the Petition for Review on Certiorari, REVERSED and SET ASIDE the CA Decision, and declared the RTC Decision (insofar as it ruled on the civil liabilities of the parties) as NULL and VOID for lack of jurisdiction.
ESSENTIAL ELEMENTS OF JURISPRUDENCE (CONTROLLING DOCTRINES)
Jurisdiction over Civil Liability (Ex Contractu): While civil liability ex delicto (arising from the crime) may be recovered in a criminal case where the accused is acquitted on reasonable doubt, this rule does not apply if the source of the obligation is a contract (ex contractu).
Exclusive Administrative Jurisdiction (HLURB/HSAC): Claims involving specific performance or refund filed by a condominium unit buyer against the developer fall under the exclusive jurisdiction of the Housing and Land Use Regulatory Board (HLURB), now the Human Settlements Adjudication Commission (HSAC). This is mandated by Section 1 of P.D. No. 1344 in relation to P.D. No. 957.
Void Judgment for Lack of Jurisdiction: A court that rules on a subject matter exclusively reserved by statute to an administrative body (like the HLURB/HSAC) renders a judgment on that matter that is null and void for lack of jurisdiction over the subject matter.
Availability of Annulment of Judgment (Rule 47): A petition for annulment of judgment is a proper remedy to challenge the civil aspect of a criminal case when the ground is lack of jurisdiction, especially since a judgment rendered without jurisdiction is void ab initio and never acquires finality. Consequently, the petitioner is not required to allege the unavailability of ordinary remedies (like appeal).
SAMPLE Q&A (Bar Exam Style)
Question: Developer X was criminally charged for violating P.D. No. 957 after failing to deliver a unit to Buyer Y, who had made substantial, but incomplete, payments. The RTC acquitted X on reasonable doubt, but ordered X to reimburse Y the amount paid plus interest, citing that civil liability is not extinguished by an acquittal on reasonable doubt (Article 100, Revised Penal Code). X failed to appeal the civil ruling and files a Petition for Annulment of Judgment based on lack of jurisdiction. Should the Petition prosper, considering the RTC’s jurisdiction over the criminal case implies jurisdiction over the resulting civil liability (Rule 111, Section 1, 2000 Rules on Criminal Procedure)?
Answer: Yes, the Petition for Annulment of Judgment should prosper. While the RTC had jurisdiction over the criminal action for violation of P.D. No. 957, its ruling regarding the civil liabilities of X and Y was null and void for lack of subject matter jurisdiction. The liability imposed was based on the parties’ breach of contract (ex contractu), not arising from the act constituting the crime (ex delicto). Pursuant to P.D. No. 1344, exclusive jurisdiction over claims for refund or specific performance filed by buyers against developers is vested in the HLURB/HSAC. Since the judgment was rendered without jurisdiction, it is void ab initio and never attained finality, thus making the remedy of annulment of judgment appropriate.
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