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Republic of the PhilippinesSUPREME COURT
Manila
EN BANC
G.R. No. 71169 December 22, 1988
JOSE D. SANGALANG and LUTGARDA D. SANGALANG, petitioners, FELIX C. GASTON andDOLORES R. GASTON, JOSE V. BRIONES and ALICIA R. BRIONES, and BEL-AIR VILLAGE
ASSOCIATION, INC., intervenors-petitioners,vs.
INTERMEDIATE APPELLATE COURT, and AYALA CORPORATION, respondents.
G.R. No. 74376 December 22, 1988
BEL-AIR VILLAGE ASSOCIATION, INC., petitioner,vs.
THE INTERMEDIATE APPELLATE COURT, ROSARIO DE JESUS TENORIO, and CECILIAGONZALVEZ, respondents.
G.R. No. 76394 December 22,1988
BEL-AIR VILLAGE ASSOCIATION, INC., petitioner,vs.
THE COURT OF APPEALS, and EDUARDO and BUENA ROMUALDEZ respondents.
G.R. No. 78182 December 22, 1988
BEL-AIR VILLAGE ASSOCIATION, INC., petitioner,vs.
COURT OF APPEALS, DOLORES FILLEY, and J. ROMERO & ASSOCIATES, respondents.
G.R. No. 82281 December 22, 1988
BEL-AIR VILLAGE ASSOCIATION, INC, petitioner,vs.
COURT OF APPEALS, VIOLETA MONCAL, and MAJAL DEVELOPMENT CORPORATION,respondents.
Sangco, Anastacio, Castaneda & Duran Law Office for petitioners & private intervenors- petitioners.
Raul S. Sison Law Offices for intervenor-petitioner Bel-Air Village Association, Inc. Renato L. DelaFuente for respondent Ayala Corporation.
G.R. No. L-74376:
Raul S. Sison Law Offices for petitioner.
Sergio L. Guadiz for private respondents.
G.R. No. L-76394:
Raul S. Sison Law Offices for petitioner.
Gruba, Tanlimco Lamso and Apuhin Law Offices for respondents.
G.R. No. L-78182:
Funk & Associates for petitioners.
Tee Tomas & Associates for respondents.
G.R. No. L-82281:
Funk & Associates for petitioner.
Castillo, Laman, Tan & Associates for private respondents.
SARMIENTO, J.:
Before the Court are five consolidated petitions, 1 docketed as G.R. Nos. 71169, 74376, 76394,78182, and 82281 hereof, in the nature of appeals (by certiorari under Rule 45 of the Rules of Court)from five decisions of the Court of Appeals, denying specific performance and damages.
The proceedings were commenced at the first instance by Jose Sangalang, joined by his wifeLutgarda Sangalang, both residents of No. 110 Jupiter Street, Makati, Metro Manila (G.R. No. 71169)to enforce by specific performance restrictive easement upon property, specifically the Bel- Air Villagesubdivision in Makati, Metro Manila, pursuant to stipulations embodied in the deeds of sale coveringthe subdivision, and for damages. Later, the Sangalangs were joined by Felix Gaston, a resident ofNo. 64 Jupiter Street of the same municipality, and by Mr. and Mrs. Jose and Alicia Briones, both ofNo. 66 Jupiter Street. Pending further proceedings, the Bel-Air Village Association, Inc. (BAVA), anincorporated homeowners' association, entered its appearance as plaintiff-in-intervention.
BAVA itself had brought its own complaints, four in number, likewise for specific performance anddamages to enforce the same 'deed restrictions.' (See G.R. Nos. 74376, 76394, 78182, and 82281.)
ANTECEDENTS FACTS
I. G.R. No. 71169
The facts are stated in the decision appealed from. We quote:
x x x x x x x x x
(1) Bel-Air Village is located north of Buendia Avenue extension (now Sen. Gil J. PuyatAve.) across a stretch of commercial block from Reposo Street in the west up to ZodiacStreet in the east, When Bel-Air Village was planned, this block between Reposo andZodiac Streets adjoining Buendia Avenue in front of the village was designated as acommercial block. (Copuyoc TSN, p. 10, Feb. 12, 1982).
(2) Bel-Air Village was owned and developed into a residential subdivision in the 1950sby Makati Development Corporation (hereinafter referred to as MDC), which in 1968was merged with appellant Ayala Corporation.
(3) Appellees-spouses Sangalang reside at No. 11O Jupiter Street between MakatiAvenue and Reposo Street; appellees-spouses Gaston reside at No. 64 Jupiter Streetbetween Makati Avenue and Zodiac Street; appellees-spouses Briones reside at No. 66Jupiter Street also between Makati Avenue and Zodiac Street; while appellee Bel-AirVillage Association, Inc. (hereinafter referred to as BAVA) is the homeowners'association in Bel-Air Village which takes care of the sanitation, security, trafficregulations and general welfare of the village.
(4) The lots which were acquired by appellees Sangalang and spouse Gaston andspouse and Briones and spouse in 1960, 1957 and 1958, respectively, were all sold byMDC subject to certain conditions and easements contained in Deed Restrictions whichformed a part of each deed of sale. The pertinent provisions in said Deed Restrictions,which are common to all lot owners in Bel-Air Village, are as follows:
I-BEL-AIR ASSOCIATION
The owner of this lot/s or his successors in interest is required to be and is automaticallya member of the Bel-Air Association and must abide by such rules and regulations laiddown by the Association in the interest of the sanitation, security and the generalwelfare of the community.
The association will also provide for and collect assessments, which will constitute as alien on the property junior only to liens of the government for taxes and to voluntarymortgages for sufficient consideration entered into in good faith.
II-USE OF LOTS
Subject to such amendments and additional restrictions, reservations, servitudes, etc.,as the Bel- Air Association may from time to time adopt and prescribe, this lot is subjectto the following restrictions:
a. This lot/s shall not be subdivided. However, three or more lots may be consolidatedand subdivided into a lesser number of lots provided that none of the resulting lots besmaller in area than the smallest lot before the consolidation and that the consolidationand subdivision plan be duly approved by the governing body of the Bel-Air Association.
b. This lot/s shall only be used for residential purposes.
c. Only one single family house may be constructed on a single lot, although separateservants' quarters or garage may be built.
d. Commercial or advertising signs shall not be placed, constructed, or erected on thislot. Name plates and professional signs of homeowners are permitted so long as theydo not exceed 80 x 40 centimeters in size.
e. No cattle, pigs, sheep, goats, ducks, geese, roosters or rabbits shall be maintained inthe lot, except that pets may be maintained but must be controlled in accordance withthe rulings of the Association. The term "pets' includes chickens not in commercialquantities.
f. The property is subject to an easement of two (2) meters within the lot and adjacent tothe rear and sides thereof not fronting a street for the purpose of drainage, sewage,water and other public facilities as may be necessary and desirable; and the owner,lessee or his representative shall permit access thereto by authorized representatives ofthe Bel-Air Association or public utility entities for the purposes for which the easementis created.
g. This lot shall not be used for any immoral or illegal trade or activity.
h. The owner and/or lessee of this lot/s shall at all times keep the grass cut and trimmedto reduce the fire hazard of the property.
xxx xxx xxx
VI-TERM OF RESTRICTIONS
The foregoing restrictions shall remain in force for fifty years from January 15, 1957,unless sooner cancelled in its entirety by two thirds vote of members in good standingof the Bel-Air Association. However, the Association may, from time to time, add newones, amend or abolish particular restrictions or parts thereof by majority rule.
VII--ENFORCEMENT OF RESTRICTIONS
The foregoing restrictions may be enjoined and/or enforced by court action by the Bel-Air Association, or by the Makati Development Corporation or its assigns, or by anyregistered owner of land within the boundaries of the Bel-Air Subdivision (Sub-divisionplan PSD-49226 and Lot 7-B, Psd-47848) or by any member in good standing of theBel-Air association." (Exh. 1 -b; Exh. 22, Annex "B"). (Appellant's Brief, pp. 4- 6)
(5) When MDC sold the above-mentioned lots to appellees' predecessors-in-interest,the whole stretch of the commercial block between Buendia Avenue and Jupiter Street,from Reposo Street in the west to Zodiac Street in the east, was still undeveloped.Access, therefore, to Bel-Air Village was opened to all kinds of people and evenanimals. So in 1966, although it was not part of the original plan, MDC constructed afence or wall on the commercial block along Jupiter Street. In 1970, the fence or wallwas partly destroyed by typhoon "Yoling." The destroyed portions were subsequentlyrebuilt by the appellant. (Copuyoc TSN, pp. 31-34, Feb. 12, 1982). When Jupiter Streetwas widened in 1972 by 3.5 meters, the fence or wall had to be destroyed. Uponrequest of BAVA, the wall was rebuilt inside the boundary of the commercial block.(Copuyoc TSN, pp. 4447, Feb. 12,1982).
(6) When the appellant finally decided to subdivide and sell the lots in the commercialblock between Buendia and Jupiter, BAVA wrote the appellant on May 9, 1972,requesting for confirmation on the use of the commercial lots. The appellant replied onMay 16, 1972, informing BAVA of the restrictions intended to be imposed in the saleand use of the lots. Among these restrictions are: that the building shall have a set backof 19 meters; and that with respect to vehicular traffic along Buendia Avenue, entranceonly will be allowed, and along Jupiter Street and side streets, both entrance and exitwill be allowed.
(7) On June 30, 1972, appellant informed BAVA that in a few months it shall subdivideand sell the commercial lots bordering the north side of Buendia Avenue Extension fromReposo Street up to Zodiac Street. Appellant also informed BAVA that it had taken allprecautions and will impose upon the commercial lot owners deed restrictions which willharmonize and blend with the development and welfare of Bel-Air Village. Appellantfurther applied for special membership in BAVA of the commercial lot owners. A copy ofthe deed restrictions for the commercial lots was also enclosed. The proposed deedrestrictions shall include the 19 meter set back of buildings from Jupiter Street, therequirement for parking space within the lot of one (1) parking slot for every seventy five(75) meters of office space in the building and the limitation of vehicular traffic alongBuendia to entrance only, but allowing both vehicular entrance and vehicular exitthrough Jupiter Street and any side street.
In its letter of July 10, 1972, BAVA acknowledged the above letter of appellant andinformed the latter that the application for special membership of the commercial lotowners in BAVA would be submitted to BAVA's board of governors for decision.
(8) On September 25, 1972, appellant notified BAVA that, after a careful study, it was
finally decided that the height limitation of buildings on the commercial lots shall beincreased from 12.5 meters to 15 meters. Appellant further informed BAVA that JupiterStreet shall be widened by 3.5 meters to improve traffic flow in said street. BAVA did notreply to said letter, but on January 22, 1973, BAVA wrote a letter to the appellantinforming the latter that the Association had assessed the appellant, as special memberof the association, the amount of P40,795.00 (based on 81,590 square meters at P.50per square meter) representing the membership dues to the commercial lot owners forthe year 1973, and requested the appellant to remit the amount which its board ofgovernors had already included in its current budget. In reply, appellant on January 31,1973 informed BAVA that due to the widening of Jupiter Street, the area of the lotswhich were accepted by the Association as members was reduced to 76,726 squaremeters. Thus, the corresponding dues at P.50 per square meter should be reduced toP38,363.00. This amount, therefore, was remitted by the appellant to BAVA. Since then,the latter has been collecting membership dues from the owners of the commercial lotsas special members of the Association. As a matter of fact, the dues were increasedseveral times. In 1980, the commercial lot owners were already being charged dues atthe rate of P3.00 per square meter. (Domingo, TSN, p. 36, March 19, 1980). At thisrate, the total membership dues of the commercial lot owners amount to P230,178. 00annually based on the total area of 76,726 square meters of the commercial lots.
(9) Meantime, on April 4, 1975, the municipal council of Makati enacted its ordinanceNo. 81, providing for the zonification of Makati (Exh. 18). Under this Ordinance, Bel-AirVillage was classified as a Class A Residential Zone, with its boundary in the southextending to the center line of Jupiter Street (Exh. 18-A).
Thus, Chapter III, Article 1, Section 3.03, par. F. of the Ordinance provides:
F. Bel-Air Village area, as bounded on the N by Polaris and Mercedes streets and onthe NE by Estrella Street; on the SE by Epifanio de los Santos Avenue and on the SWby the center line of Jupiter Street. Then bounded on the N by the abandoned MRRPasig Line; on the E by Makati Avenue; on the S by the center line of Jupiter Street andon the W by the center line of Reposo Street." (Exh. 18-A)
Similarly, the Buendia Avenue Extension area was classified as Administrative OfficeZone with its boundary in the North-North East Extending also up to the center line ofJupiter Street (Exh. 18b).
Thus, Chapter III, Article I, Section 3.05, par. C. of the Ordinance provides:
C. The Buendia Avenue Extension areas, as bounded on the N-NE by the center line ofJupiter Street, on the SE by Epifanio de los Santos Avenue; on the SW by BuendiaAvenue and on the NW by the center line of Reposo Street, then on the NE by MalugayStreet; on the SE by Buendia Avenue and on the W by Ayala Avenue Extension." (Exh.18-B)
The Residential Zone and the Administrative Office Zone, therefore, have a commonboundary along the center line of Jupiter Street.
The above zoning under Ordinance No. 81 of Makati was later followed under theComprehensive Zoning Ordinance for the National Capital Region adopted by the MetroManila Commission as Ordinance 81 -01 on March 14, 1981 (Exh. 19). However, underthis ordinance, Bel-Air Village is simply bounded in the South-Southeast by JupiterStreet-not anymore up to the center line of Jupiter Street (Exh. B). Likewise, theblockdeep strip along the northwest side of Buendia Avenue Extension from Reposo to
EDSA was classified as a High Intensity Commercial Zone (Exh. 19-c).
Thus, the Zoning District Boundaries -Makati, in Annex B of the Ordinance provides:
R-I-Low Intensity Residential
x x x x x x x x x
4. Bel-Air 1, 3, 4
Bounded on the North -- J.P. Rizal and Amapola St.
South - Rockwell
Northwest - P. Burgos
Southeast - Jupiter
Southwest - Epifanio de los Santos Ave. (EDSA)
5. Bel-Air 2
Bounded on the Northwest - J.P. Rizal
Southwest - Makati Avenue
South --- Jupiter
Southeast -- Pasig Line
East - South Avenue" (Exh. 19-b)
x x x x x x x x x
C-3-High Intensity Commercial Zone
2. A block deep strip along the northwest side of Buendia Ave. Ext. from Reposo toEDSA." (Exh, 19-c)
Under the above zoning classifications, Jupiter Street, therefore, is a common boundaryof Bel-Air Village and the commercial zone.
(10) Meanwhile, in 1972, BAVA had installed gates at strategic locations across JupiterStreet which were manned and operated by its own security guards who wereemployed to maintain, supervise and enforce traffic regulations in the roads and streetsof the village. (Villavicencio, TSN, pp, 22-25, Oct. 30, 1980; BAVA Petition, par. 11,Exh. 17).
Then, on January 17, 1977, the Office of the Mayor of Makati wrote BAVA directing that,in the interest of public welfare and for the purpose of easing traffic congestion, thefollowing streets in Bel-Air Village should be opened for public use:
Amapola Street - from Estrella Street to Mercedes Street
Amapola Street -junction of Palma Street gate going to J. Villena Street
Mercedes Street -- from EDSA to Imelda Avenue and Amapola junction
Zodiac Street - from Mercedes Street to Buendia Avenue
Jupiter Street -- from Zodiac Street to Reposo Street connecting Metropolitan Avenue toPasong Tamo and V. Cruz Extension intersection
Neptune Street - from Makati Avenue to Reposo Street Orbit Street - from F. Zobel-Candelaria intersection to Jupiter Street
Paseo de Roxas - from Mercedes Street to Buendia Avenue (Exh. 17, Annex A, BAVAPetition)
On February 10, 1977, BAVA wrote the Mayor of Makati, expressing the concern of theresidents about the opening of the streets to the general public, and requestingspecifically the indefinite postponement of the plan to open Jupiter Street to publicvehicles. (Exh. 17, Annex B, BAVA Petition).
However, BAVA voluntarily opened to the public Amapola, Mercedes, Zodiac, Neptuneand Paseo de Roxas streets. (Exh. 17-A, Answer of Makati par. 3-7).
Later, on June 17,1977, the Barangay Captain of Bel-Air Village was advised by theOffice of the Mayor that, in accordance with the agreement entered into during themeeting on January 28, 1 977, the Municipal Engineer and the Station Commander ofthe Makati Police were ordered to open for public use Jupiter Street from MakatiAvenue to Reposo Street. Accordingly, he was requested to advise the village residentsof the necessity of the opening of the street in the interest of public welfare. (Exh. 17,Annex E, BAVA Petition).
Then, on June 10, 1977, the Municipal Engineer of Makati in a letter addressed toBAVA advised the latter to open for vehicular and pedestrian traffic the entire portion ofJupiter Street from Makati Avenue to Reposo Street (Exh. 17, BAVA Petition, par. 14).
Finally, on August 12, 1977, the municipal officials of Makati concerned allegedlyopened, destroyed and removed the gates constructed/located at the corner of ReposoStreet and Jupiter Street as well as the gates/fences located/constructed at JupiterStreet and Makati Avenue forcibly, and then opened the entire length of Jupiter Street topublic traffic. (Exh. 17, BAVA Petition, pars. 16 and 17).
(11) Before the gates were-removed, there was no parking problem or traffic problem inJupiter Street, because Jupiter Street was not allowed to be used by the general public(Villavicencio, TSN, pp. 24-25, Oct. 30, 1980). However, with the opening of ZodiacStreet from Estrella Street to Jupiter Street and also the opening to the public of theentire length of Jupiter Street, there was a tremendous increase in the volume of trafficpassing along Jupiter Street coming from EDSA to Estrella Street, then to Zodiac Streetto Jupiter Street, and along the entire length of Jupiter Street to its other end at ReposoStreet. (Villavicencio, TSN, pp. 30-32, Oct. 30, 1980).
In the meantime, the purchasers of the commercial lots between Jupiter Street andBuendia Avenue extension had started constructing their respective buildings in1974-1975. They demolished the portions of the fence or wall standing within theboundary of their lots. Many of the owners constructed their own fences or walls in lieuof the wall and they employed their own security guards. (TSN, p. 83, Feb. 20,1981;TSN, pp. 53-54; 72-74, March 20,1981; TSN, pp. 54-55, July 23, 1981).
(12) Then, on January 27, 1978, appellant donated the entire Jupiter Street fromMetropolitan Avenue to Zodiac Street to BAVA (Exh. 7)- However, even before 1978,the Makati Police and the security force of BAVA were already the ones regulating thetraffic along Jupiter Street after the gates were opened in 1977. Sancianco TSN, pp.
26-30, Oct. 2,1981).
In October, 1979, the fence at the corner of Orbit and Neptune Streets was opened andremoved (BAVA Petition, par. 22, Exh. 17). The opening of the whole stretch of OrbitStreet from J.P. Rizal Avenue up to Imelda Avenue and later to Jupiter Street wasagreed to at the conference attended by the President of BAVA in the office of theStation Commander of Makati, subject to certain conditions, to wit:
That, maintenance of Orbit St. up to Jupiter St. shall be shouldered by the Municipalityof Makati.
That, street lights will be installed and maintenance of the same along Orbit St. fromJ.P. Rizal Ave. up to Jupiter St. shall be undertaken by the Municipality.
That for the security of the residents of San Miguel Village and Bel-Air Village, as aresult of the opening of Orbit Street, police outposts shall be constructed by theMunicipality of Makati to be headed by personnel of Station No. 4, in close coordinationwith the Security Guards of San Miguel Village and Bel-Air Village." (CF. Exh. 3 toCounter-Affidavit, of Station Commander, Ruperto Acle p. 253, records)" (Order, CivilCase No. 34948, Exh. 17-c).
(13) Thus, with the opening of the entire length of Jupiter Street to public traffic, thedifferent residential lots located in the northern side of Jupiter Street ceased to be usedfor purely residential purposes. They became, for all purposes, commercial in character.
(14) Subsequently, on October 29, 1979, the plaintiffs-appellees Jose D. Sangalangand Lutgarda D. Sangalang brought the present action for damages against thedefendant-appellant Ayala Corporation predicated on both breach of contract and ontort or quasi-delict A supplemental complaint was later filed by said appellees seeking toaugment the reliefs prayed for in the original complaint because of alleged superveningevents which occurred during the trial of the case. Claiming to be similarly situated asthe plaintiffs-appellees, the spouses Felix C. Gaston and Dolores R. Gaston, Jose V.Briones and Alicia R. Briones, and the homeowners' association (BAVA) intervened inthe case.
(15) After trial on the merits, the then Court of First Instance of Rizal, Pasig, MetroManila, rendered a decision in favor of the appellees the dispositive portion of which isas follows:
WHEREFORE, judgment is hereby accordingly rendered as follows:
ON PLAINTIFFS' COMPLAINT:
Defendant is ordered to pay to the plaintiffs-spouses Sangalang the following damages:
1. The sum of P500,000.00 as actual and consequential damages;
2. The sum of P2,000,000.00 as moral damages;
3. The sum of P500,000.00 as exemplary damages;
4. The sum of P100,000.00 as attorney's fees; and
5. The costs of suit.
ON INTERVENORS FELIX and DOLORES GASTON'S COMPLAINT:
Defendant is ordered to pay to the spouses Felix and Dolores Gaston, the followingdamages:
1 . The sum of P400,000.00 as consequential damages;
2 The sum of P500,000.00 as moral damages;
3 The sum of P500,000.00 as exemplary damages:
4 The sum of P50,000.00 as attorney's fees; and
5 The costs of suit.
ON INTERVENORS JOSE and ALICIA BRIONES' COMPLAINT:
Defendant is ordered to pay to the spouses Jose and Alicia Briones, the followingdamages:
1 . The sum of P400,000.00 as consequential damages;
2 The sum of P500,000.00 as moral damages;
3 The sum of P500,000.00 as exemplary damages;
4 The sum of P50,000.00 as attorney's fees; and
5 The costs of suit.
ON INTERVENOR BAVA'S COMPLAINT:
Defendant is ordered to pay intervenor BAVA, the following damages:
1. The sum of P400,000.00 as consequential damages;
2. The sum of P500,000.00 as exemplary damages;
3. The sum of P50,000.00 as attorney's fees; and
4. The costs of suit.
The above damages awarded to the plaintiffs and intervenors shall bear legal interestfrom the filing of the complaint.
Defendant is further ordered to restore/reconstruct the perimeter wall at its originalposition in 1966 from Reposo Street in the west to Zodiac Street in the east, at its ownexpense, within SIX (6) MONTHS from finality of judgment.
SO ORDERED.
(Record on Appeal, pp. 400-401) 2
x x x x x x x x x
On appeal, the Court of Appeals 3 rendered a reversal, and disposed as follows:
ACCORDINGLY, finding the decision appealed from as not supported by the facts andthe law on the matter, the same is hereby SET ASIDE and another one entereddismissing the case for lack of a cause of action. Without pronouncement as to costs.
SO ORDERED. 4
II. G.R. No. 74376
This petition was similarly brought by BAVA to enforce the aforesaid restrictions stipulated in thedeeds of sale executed by the Ayala Corporation. The petitioner originally brought the complaint inthe Regional Trial Court of Makati, 5 principally for specific performance, plaintiff [now, petitioner]alleging that the defendant [now, private respondent] Tenorio allowed defendant [Tenorio's co-privaterespondent] Gonzalves to occupy and convert the house at 50 Jupiter Street, Bel-Air Village, Makati,Metro Manila, into a restaurant, without its knowledge and consent, and in violation of the deedrestrictions which provide that the lot and building thereon must be used only for residential purposesupon which the prayed for main relief was for 'the defendants to permanently refrain from using thepremises as commercial and to comply with the terms of the Deed Restrictions." 6 The trial courtdismissed the complaint on a procedural ground, i.e., pendency of an Identical action, Civil Case No.32346, entitled "Bel-Air Village Association, Inc. v. Jesus Tenorio." The Court of Appeals 7 affirmed,and held, in addition, that Jupiter Street "is classified as High density commercial (C-3) zone as perComprehensive Zoning Ordinance No. 81-01 for National Capital Region," 8 following its own ruling inAC-G.R. No. 66649, entitled "Bel-Air Village Association, Inc. vs. Hy-Land Realty & DevelopmentCorporation, et al."
III. G.R. No. 76394
x x x x x x x x x
Defendants-spouses Eduardo V. Romualdez, Jr. and Buena Tioseco are the owners ofa house and lot located at 108 Jupiter St., Makati, Metro Manila as evidenced byTransfer Certificate of Title No. 332394 of the Registry of Deeds of Rizal. The fact isundisputed that at the time the defendants acquired the subject house and lot, severalrestrictions were already annotated on the reverse side of their title; however, forpurposes of this appeal we shall quote hereunder only the pertinent ones, to wit:
(b,) This lot/shall be used only for residential purposes.
x x x x x x x x x
IV. Term of Restriction
The foregoing restriction(s) shall remain in force for fifty years from January 15, 1957,unless sooner cancelled in its entirety by two-thirds vote of the members in goodstanding of the Bel-Air Association. However, the Association may from time to time,add new ones, amend or abolish particular restrictions or parts thereof by majority rule.
During the early part of 1979, plaintiff noted that certain renovations and constructionswere being made by the defendants on the subject premises, for which reason thedefendants were advised to inform the plaintiff of the kind of construction that was goingon. Because the defendants failed to comply with the request of the plaintiff, the latter'schief security officer visited the subject premises on March 23, 1979 and found out thatthe defendants were putting up a bake and coffee shop, which fact was confirmed bydefendant Mrs. Romualdez herself. Thereafter, the plaintiff reminded defendants thatthey were violating the deed restriction. Despite said reminder, the defendantsproceeded with the construction of the bake shop. Consequently, plaintiff sentdefendants a letter dated April 30, 1979 warning them that if they will not desist fromusing the premises in question for commercial purposes, they will be sued for violationsof the deed restrictions.
Despite the warning, the defendants proceeded with the construction of their bake shop.9
x x x x x x x x x
The trial court 10 adjudged in favor of BAVA. On appeal, the Court of Appeals 11 reversed, on thestrength of its holding in AC-G.R. No. 66649 earlier referred to.
BAVA then elevated the matter to the Court by a petition for review on certiorari. The Court 12 initiallydenied the petition "for lack of merit, it appearing that the conclusions of the respondent Court ofAppeals that private respondents' bake and coffee shop lies within a commercial zone and that saidprivate respondents are released from their obligations to maintain the lot known as 108 JupiterStreet for residential purposes by virtue of Ordinance No. 81 of the Municipality of Makati andComprehensive Zoning Ordinance No. 81-01 of the Metropolitan Manila Commission, are in accordwith law and jurisprudence," 13 for which BAVA sought a reconsideration. Pending resolution, thecase was referred to the Second Division of this Court, 14 and thereafter, to the Court En Banc enconsulta. 15 Per our Resolution, dated April 29, 1988, we consolidated this case with G.R. Nos.74376 and 82281. 16
IV. G.R. No. 78182.
x x x x x x x x x
The case stemmed from the leasing by defendant Dolores Filley of her building and lotsituated at No. 205 Reposo Street, Bel-Air Village Makati, Metro Manila to her co-defendant, the advertising firm J. Romero and Associates, in alleged violation of deedrestrictions which stipulated that Filley's lot could only be used for residential purposes.Plaintiff sought judgment from the lower court ordering the defendants to "permanentlyrefrain" from using the premises in question "as commercial" and to comply with theterms of the deed restrictions.
After the proper proceedings, the court granted the plaintiff the sought for relief with theadditional imposition of exemplary damages of P50,000.00 and attorney's fees ofP10,000.00. The trial court gave emphasis to the restrictive clauses contained in Filley'sdeed of sale from the plaintiff, which made the conversion of the building into acommercial one a violation.
Defendants now seek review and reversal on three (3) assignments of errors, namely:
I.
THE TRIAL COURT ERRED IN NOT FINDING THAT THE REGULATIONSPROMULGATED BY THE MUNICIPAL AUTHORITIES IN MAKATI AND THEMINISTRY OF HUMAN SETTLEMENT'S CHANGING THE CHARACTER OF THEAREAS IN QUESTION HAD RENDERED THE RESTRICTIVE EASEMENT ON THETITLE OF THE APPELLANTS VACATED.
II.
THE COURT ERRED IN NOT RULING THAT BECAUSE THE APPELLEE(S) HADALLOWED THE USE OF THE PROPERTY WITHIN THE VILLAGE FOR NON-RESIDENTIAL PURPOSES, IT IS NOW ESTOPPED FROM ENFORCING THERESTRICTIVE PROHIBITIONS SUBJECT MATTER OF THIS CASE.
III.
THE COURT ERRED IN NOT FINDING THAT THERE EXISTED A BILATERALCONTRACT BETWEEN THE PARTIES AND THAT SINCE APPELLEE HAD NOTPERFORMED ITS OBLIGATIONS UNDER THIS ARRANGEMENT THE APPELLANTIN TURN WAS UNDER NO OBLIGATION TO ANNOTATE THE RESTRICTIVEPROHIBITIONS ON THE BACK OF THE TITLE.
Appellants anchor their appeal on the proposition that the Bel-Air Village area, contraryto plaintiff- appellee's pretension of being a strictly residential zone, is in factcommercial and characterize the restrictions contained in appellant Filley's deed of salefrom the appellee as completely outmoded, which have lost all relevance to thepresent-day realities in Makati, now the premier business hub of the nation, where thereis a proliferation of numerous commercial enterprises established through the years, infact even within the heart of so-called "residential" villages. Thus, it may be said thatappellants base their position on the inexorable march of progress which has renderedat naught the continued efficacy of the restrictions. Appellant on the other hand, relieson a rigid interpretation of the contractual stipulations agreed upon with appellant Filley,in effect arguing that the restrictions are valid ad infinitum.
The lower court quite properly found that other commercial establishments exist in thesame area (in fact, on the same street) but ignored it just the same and said-
The fact that defendants were able to prove the existence of several commercialestablishments inside the village does not exempt them from liability for violating someof the restrictions evidently choosing to accord primacy to contractual stipulation. 17
x x x x x x x x x
The Court of Appeals 18 overturned the lower court, 19 likewise based on AC-G.R. No. 66649. Therespondent Court observed also that J. Romero & Associates had been given authority to open acommercial office by the Human Settlements Regulatory Commission.
V. G.R. No. 82281
The facts of this case have been based on stipulation. We quote:
COMES NOW, the Parties, assisted by their respective counsel and to this HonorableCourt, respectfully enter into the following stipulations of facts, to wit:
1. The parties admit the personal circumstances of each other as well as theircapacities to sue and be sued.
2. The parties admit that plaintiff BAVA for short) is the legally constituted homeowners'association in Bel-Air Subdivision, Makati, Metro Manila.
3. The parties admit that defendant Violets Moncal is the registered owner of a parcel ofland with a residential house constructed thereon situated at No. 104 Jupiter Street,Bel-Air Village, Makati, Metro Manila; that as such lot owner, she is a member of theplaintiff association.
4. The parties admit that defendant Majal Development Corporation (Majal for short) isthe lessee of defendant Moncal's house and lot located at No. 104 Jupiter Street.
5. The parties admit that a deed restrictions is annotated on the title of defendantMoncal, which provides, among others, that the lot in question must be used only forresidential purposes;' that at time Moncal purchased her aforesaid lot in 1959 said deed
restrictions was already annotated in the said title.
6. The parties admit that when Moncal leased her subject property to Majal, she did notsecure the consent of BAVA to lease the said house and lot to the present lessee.
7. The parties admit that along Jupiter Street and on the same side where Moncal'sproperty is located, there are restaurants, clinics placement or employment agenciesand other commercial or business establishments. These establishments, however,were sued by BAVA in the proper court.
8. The parties admit that at the time Moncal purchased the subject property from theMakati Development Corporation, there was a perimeter wall, running along JupiterStreet, which wall was constructed by the subdivision owner; that at that time the gatesof the entrances to Jupiter Street were closed to public traffic. In short, the entire lengthof Jupiter which was inside the perimeter wall was not then open to public traffic
9. The parties admit that subsequent thereto, Ayala tore down the perimeter wall to giveway to the commercial building fronting Buendia Avenue (now Gil J. Puyat Avenue).
10. The parties admit that on August 12, 1977, the Mayor of Makati forcibly opened andremoved the street gates constructed on Jupiter Street and Reposo Street, therebyopening said streets to the public.
11. The parties admit plaintiffs letters of October 10, 23 and 31, 1984; as well asdefendants' letters-reply dated October 17 and 29, 1984. 20
x x x x x x x x x
The trial court 21 dismissed the petitioner's complaint, a dismissal affirmed on appeal, 22 Accordingto the appellate court, the opening of Jupiter Street to human and vehicular traffic, and thecommercialization of the Municipality of Makati in general, were circumstances that had madecompliance by Moncal with the aforesaid "deed restrictions" "extremely difficult and unreasonable,"23 a development that had excused compliance altogether under Article 1267 of the Civil Code.
VI. The cases before the Court; the Court's decision.
In brief, G.R. Nos. 74376, 76394, 78182, and 82281 are efforts to enforce the "deed restrictions" inquestion against specific residents (private respondents in the petitions) of Jupiter Street and withrespect to G.R. No. 78182, Reposo Street. The private respondents are alleged to have convertedtheir residences into commercial establishments (a restaurant in G.R. No. 74376, a bakery and coffeeshop in G.R. No. 76394, an advertising firm in G.R. No. 78182; and a construction company,apparently, in G.R. No. 82281) in violation of the said restrictions. 24
Their mother case, G. R. No. 71169 is, on the other hand, a petition to hold the vendor itself, AyalaCorporation (formerly Makati Development Corporation), liable for tearing down the perimeter wallalong Jupiter Street that had therefore closed its commercial section from the residences of Bel-AirVillage and ushering in, as a consequence, the full "commercialization" of Jupiter Street, in violationof the very restrictions it had authored.
As We indicated, the Court of Appeals dismissed all five appeals on the basis primarily of its ruling inAC-G.R. No. 66649, "Bel-Air Village, Inc. v. Hy-Land Realty Development Corporation, et al.," inwhich the appellate court explicitly rejected claims under the same 'deed restrictions" as a result ofOrdinance No. 81 enacted by the Government of the Municipality of Makati, as well asComprehensive Zoning Ordinance No. 8101 promulgated by the Metropolitan Manila Commission,which two ordinances allegedly allowed the use of Jupiter Street both for residential and commercial
purposes. It was likewise held that these twin measures were valid as a legitimate exercise of policepower.
The Court of Appeals' reliance on Ordinance Nos. 81. and 8101 is now assailed in these petitions,particularly the Sangalang, et al. petition.
Aside from this fundamental issue, the petitioners likewise raise procedural questions. G.R. No.71169, the mother case, begins with one.
1. G.R. No. 71169
In this petition, the following questions are specifically put to the Court:
May the Honorable Intermediate Appellate Court reverse the decision of the trial courton issues which were neither raised by AYALA in its Answers either to the Complaint orSupplemental Complaint nor specifically assigned as one of the alleged errors onappeal? 25
May the Honorable Intermediate Appellate Court arbitrarily ignore the decisive findingsof fact of the trial court, even if uncontradicted and/or documented, and premised mainlyon its own unsupported conclusions totally reverse the trial court's decision? 26
May the Honorable Intermediate Appellate Court disregard the trial court's documentedfindings that respondent Ayala for its own self-interest and commercial purposescontrived in bad faith to do away with the Jupiter Street perimeter wall it put up threetimes which wall was really intended to separate the residential from the commercialareas and thereby insure the privacy and security of Bel Air Village pursuant torespondent Ayala's express continuing representation and/or covenant to do so? 27
a.
The first question represents an attack on the appellate court's reliance on Ordinances Nos. 81 and81-01, a matter not supposedly taken up at the trial or assigned as an error on appeal. As a rule, theCourt of Appeals (then the Intermediate Appellate Court) may determine only such questions as havebeen properly raised to it, yet, this is not an inflexible rule of procedure. In Hernandez v. Andal, 28 itwas stated that "an unassigned error closely related to an error properly assigned, or upon which thedetermination of the question raised by the error properly assigned is dependent, will be consideredby the appellate court notwithstanding the failure to assign it as error." 29
In Baquiran v. Court of Appeals, 30 we referred to the " modern trend of procedure . . . according] thecourts broad discretionary power" 31 and in which we allowed consideration of matters "having somebearing on the issue submitted which the parties failed to raise or the lower court ignore[d]. 32 And inVda. de Javellana v. Court of Appeals, 33 we permitted the consideration of a 'patent error' of the trialcourt by the Court of Appeals under Section 7, of Rule 51, of the Rules of Court, 34 although such anerror had not been raised in the brief. But what we note is the fact that the Ayala Corporation did raisethe zoning measures as affirmative defenses, first in its answers 35 and second, in its brief, 36 andsubmitted at the trial as exhibits. 37 There is accordingly no cause for complaint on the part of thepetitioners for Ayala's violation of the Rules. But while there was reason for the consideration, onappeal, of the said zoning ordinances in question, this Court nevertheless finds as inaccurate theCourt of Appeals' holding that such measures, had "in effect, [made] Jupiter Street ... a street whichcould be used not only for residential purposes," 38 and that "[It lost its character as a street for theexclusive benefit of those residing in Bel-Air Village completely." 39
Among other things, there is a recognition under both Ordinances Nos. 81 and 8 1-01 that JupiterStreet lies as the boundary between Bel-Air Village and Ayala Corporation's commercial section. And
since 1957, it had been considered as a boundary not as a part of either the residential or commercialzones of Ayala Corporation's real estate development projects. Thus, the Bel-Air Village Association'sarticles of incorporation state that Bel-Air Village is 'bounded on the NE., from Amapola St., to de losSantos Ave., by Estrella St., on the SE from Extrella St., to Pedestrian Lane by E. De los SantosAve., on the SW., from Pedestrian Lane to Reposo St., by Jupiter Street
. . . . 40 Hence, it cannot be said to have been "for the exclusive benefit" of Bel-Air Village residents.
We come to the perimeter wall then standing on the commercial side of Jupiter Street the destructionof which opened the street to the public. The petitioners contend that the opening of the thoroughfarehad opened, in turn, the floodgates to the commercialization of Bel-Air Village. The wall, so theyallege, was designed precisely to protect the peace and privacy of Bel-Air Village residents from thedin and uproar of mercantile pursuits, and that the Ayala Corporation had committed itself to maintainit. It was the opinion of the Court of Appeals, as we said, that Ayala's liability therefor, if one existed,had been overtaken by the passage of Ordinances Nos. 81 and 82-01, opening Jupiter Street tocommerce.
It is our ruling, we reiterate, that Jupiter Street lies as a mere boundary, a fact acknowledged by theauthorities of Makati and the National Government and, as a scrutiny of the records themselvesreveals, by the petitioners themselves, as the articles of incorporation of Bel-Air Village Associationitself would confirm. As a consequence, Jupiter Street was intended for the use by both -thecommercial and residential blocks. It was not originally constructed, therefore, for the exclusive use ofeither block, least of all the residents of Bel-Air Village, but, we repeat, in favor of both, asdistinguished from the general public.
When the wall was erected in 1966 and rebuilt twice, in 1970 and 1972, it was not for the purpose ofphysically separating the two blocks. According to Ayala Corporation, it was put up to enable theBel-Air Village Association "better control of the security in the area, 41 and as the AyalaCorporation's "show of goodwill " 42 a view we find acceptable in the premises. For it cannot bedenied that at that time, the commercial area was vacant, "open for [sic] animals and people to haveaccess to Bel-Air Village." 43 There was hence a necessity for a wall.
In any case, we find the petitioners' theory, that maintaining the wall was a matter of a contractualobligation on the part of Ayala, to be pure conjecture. The records do not establish the existence ofsuch a purported commitment. For one, the subdivision plans submitted did not mention anythingabout it. For another, there is nothing in the "deed restrictions" that would point to any covenantregarding the construction of a wall. There is no representation or promise whatsoever therein to thateffect.
With the construction of the commercial buildings in 1974, the reason for which the wall was built- tosecure Bel-Air Village from interlopers had naturally ceased to exist. The buildings themselves hadprovided formidable curtains of security for the residents. It should be noted that the commercial lotbuyers themselves were forced to demolish parts of the wall to gain access to Jupiter Street, whichthey had after all equal right to use.
In fine, we cannot hold the Ayala Corporation liable for damages for a commitment it did not make,much less for alleged resort to machinations in evading it. The records, on the contrary, will show thatthe Bel-Air Village Association had been informed, at the very outset, about the impending use ofJupiter Street by commercial lot buyers. We quote:
x x x x x x x x x
1. Exh. I of appellee, the memorandum of Mr. Carmelo Caluag, President of BAVA,dated May 10, 1972, informing the BAVA Board of Governors and Barrio Council
members about the future use of Jupiter Street by the lot owners fronting BuendiaAvenue. The use of Jupiter Street by the owners of the commercial lots wouldnecessarily require the demolition of the wall along the commercial block adjoiningJupiter Street.
2. Exh. J of appellee, the minutes of the joint meeting of BAVA Board of Governors andthe Bel-Air Barrio Council where the matter that "Buendia lot owners will have equalrights to use Jupiter Street," and that Ayala's "plans about the sale of lots and use ofJupiter Street" were precisely taken up. This confirms that from the start BAVA wasinformed that the commercial lot owners will use Jupiter Street and that necessarily thewall along Jupiter Street would be demolished.
3. Exh. 10, the letter of Mr. Demetrio Copuyoc to the President of BAVA, dated May 16,1972, expressly stating that vehicular entrance and exit to the commercial lots would beallowed along Jupiter and side streets.
4. Exhs. 27, 27-A, 27-B, the letter of Atty. Salvador J. Lorayes dated June 30, 1972,with enclosed copy of proposed restriction for the commercial lots to BAVA. Heproposed restriction again expressly stated that "Vehicular entrances and exits areallowed thru Jupiter and any side streets."
5. Exh. L of appellee, the minutes of the meeting of the members of BAVA, datedAugust 26, 1972, where it is stated "Recently, Ayala Corporation informed the Boardthat the lots fronting Buendia Avenue will soon be offered for sale, and that future lotowners will be given equal rights to use Jupiter Street as well as members of theAssociation."
6. Exh. 25, the letter of Atty. Lorayes dated September 25, 1972, informing BAVA of thewidening of Jupiter Street by 3.5 meters to improve traffic flow in said street to benefitboth the residents of Bel-Air and the future owners of the commercial lots. 44
The petitioners cannot successfully rely on the alleged promise by Demetrio Copuyoc, Ayala'smanager, to build a "[f]ence along Jupiter with gate for entrance and/or exit 45 as evidence of Ayala'salleged continuing obligation to maintain a wall between the residential and commercial sections. Itshould be observed that the fence referred to included a "gate for entrance and or exit" which wouldhave defeated the purpose of a wall, in the sense the petitioners would put in one, that is to say, animpenetrable barrier. But as Ayala would point out subsequently, the proposed fence was notconstructed because it had become unnecessary when the commercial lot owners commencedconstructions thereon.
Be that as it may, the Court cannot visualize any purported obligation by Ayala Corporation to keepthe wall on the strength of this supposed promise alone. If truly Ayala promised anything assumingthat Capuyoc was authorized to bind the corporation with a promise it would have been with respectto the fence. It would not have established the pre-existing obligation alleged with respect to the wall.
Obligations arise, among other things, from contract. 46 If Ayala, then, were bound by an obligation, itwould have been pursuant to a contract. A contract, however, is characterized by a "meeting of mindsbetween two persons . 47 As a consensual relation, it must be shown to exist as a fact, clearly andconvincingly. But it cannot be inferred from a mishmash of circumstances alone disclosing some kindof an "understanding," when especially, those disparate circumstances are not themselvesincompatible with contentions that no accord had existed or had been reached. 48
The petitioners cannot simply assume that the wall was there for the purpose with which they nowgive it, by the bare coincidence that it had divided the residential block from the commercial section of
Bel-Air. The burden of proof rests with them to show that it had indeed been built precisely for thatobjective, a proof that must satisfy the requirements of our rules of evidence. It cannot be made tostand on the strength of plain inferences.
b.
This likewise answers the petitioners' second query, whether or not the Court of Appeals had"arbitrarily ignore(d) the decisive findings of the trial court." 49 i.e., findings pointing to alleged actsperformed by the Ayala Corporation proving its commitment to maintain the wall abovesaid.Specifically, the petitioners refer to, among other things: (1) Ayala's alleged announcement to Bel- AirVillage Association members that "[the perimeter wall along Jupiter Street will not be demolished," 50(2) Ayala's alleged commitment "during the pendency of the case in the trial court" to restore the wall;(3) alleged assurances by Copuyoc that the wall will not be removed; (4) alleged contrivances by thecorporation to make the association admit as members the commercial lot buyers which providedthem equal access to Jupiter Street; and (5) Ayala's donation to the association of Jupiter Street for"private use" of Bel-Air residents. 51
682 (1903), where it was held that "whether the plaintiffs services were solicited or whether they wereoffered to the defendant for his assistance, inasmuch as these services were accepted and made useof by the latter, we must consider that there was a tacit and mutual consent as to the rendition ofservices." (At 686.) In that case, the defendant had enormously benefitted from the services thatentitled the plaintiff to compensation on the theory that no one may unjustly enrich himself at theexpense of another (Solutio indebiti) The facts of this case differ.
As we stated, the Ayala Corporation's alleged conduct prior to or during the proceedings below arenot necessarily at war with claims that no commitment had been in fact made.
With respect to Ayala's alleged announcement before the association, the Court does not agree thatAyala had categorically assumed as an obligation to maintain the wall "perpetually," i.e., until the year2007 (the expiration date under the "deed restrictions.") There is nothing in its statement that wouldbare any commitment. In connection with the conference between the parties "during the pendency"of the trial, it is to be noted that the Ayala Corporation denies having warranted the restoration of thesaid wall therein. What, on the other hand, appears in the records is the fact that Ayala did make thatpromise, but provided that the Mayor allowed it. It turned out, however, that the Mayor balked at theIdea. 52 But assuming that Ayala did promise to rebuild the wall (in that conference), it does notseem to us that it did consequently promise to maintain it in perpetuity.
It is unfair to say, as the trial court did, that the Ayala had "contrived to make future commercial lotowners special members of BAVA and thereby acquire equal right with the regular members thereofto use Jupiter Street 53 since, as we stated, the commercial lot buyers have the right, in any event, tomake use of Jupiter Street, whether or not they are members of the association. It is not theirmemberships that give them the right to use it. They share that right with Bel-Air residents from theoutset.
The objective of making the commercial lot owners special members of the Bel-Air VillageAssociation was not to accord them equal access to Jupiter Street and inferentially, to give them theright to knock down the perimeter wall. It was, rather, to regulate the use of the street owing preciselyto the "planned" nature of Ayala's development project, and real estate development in general, andthis could best be done by placing the commercial lot owners under the association's jurisdiction.
Moreover, Ayala's overtures with the association concerning the membership of commercial lotbuyers therein have been shown to be neither perfidious nor unethical nor devious (paraphrasing thelower court). We quote anew:
x x x x x x x x x
(7) On June 30, 1972, appellant informed BAVA that in a few months it shall subdivideand sell the commercial lots bordering the north side of Buendia Avenue Extension fromReposo Street up to Zodiac Street. Appellant also informed BAVA that it had taken allprecautions and will impose upon the commercial lot owners deed restrictions which willharmonize and blend with the development and welfare of Bel-Air Village. Appellantfurther applied for special membership in BAVA of the commercial lot owners. A copy ofthe deed restrictions for the commercial lots was also enclosed. The proposed deedrestrictions shall include the 19 meter set back of buildings from Jupiter Street, therequirement for parking space within the lot of one (1) parking slot for every seventy five(75) meters of office space in the building and the limitation of vehicular traffic alongBuendia to entrance only, but allowing both vehicular entrance and vehicular exitthrough Jupiter Street and any side street.
In its letter of July 10, 1972, BAVA acknowledged the above letter of appellant and informed the latterthat the application for special membership of the commercial lot owners in BAVA would be submittedto BAVA's board of governors for decision.
(8) On September 25,1972, appellant notified BAVA that, after a careful study, it wasfinally decided that the height limitation of buildings on the commercial lots shall beincreased from 12.5 meters to 15 meters. Appellant further informed BAVA that JupiterStreet shall be widened by 3.5 meters to improve traffic flow in said street. BAVA did notreply to said letter, but on January 22, 1973, BAVA wrote a letter to the appellantinforming the latter that the Association had assessed the appellant, as special memberof the association, the amount of P40,795.00 (based on 81,590 square meters at P.50per square meter) representing the membership dues of the commercial lot owners forthe year 1973, and requested the appellant to remit the amount which its board ofgovernors had already included in its current budget. In reply, appellant on January 31,1973 informed BAVA that due to the widening of Jupiter Street, the area of the lotswhich were accepted by the Association as members was reduced to 76,726 squaremeters. Thus, the corresponding due at P.50 per square meter should be reduced toP38,363.00. This amount, therefore, was remitted by the appellant to BAVA. Since then,the latter has been collecting membership dues from the owners of the commercial lotsas special members of the Association. As a matter of fact, the dues were increasedseveral times. In 1980, the commercial lot owners were already being charged dues atthe rate of P3.00 per square meter. (Domingo, TSN, p. 36, March 19, 1980). At thisrate, the total membership dues of the commercial lot owners amount to P230,178.00annually based on the total area of 76,726 square meters of the commercial lots. 54
x x x x x x x x x
The alleged undertaking, finally, by Ayala in the deed of donation (over Jupiter Street) to leave JupiterStreet for the private use of Bel-Air residents is belied by the very provisions of the deed. We quote:
x x x x x x x x x
IV. That the offer made by the DONOR had been accepted by the DONEE subject tothe condition that the property will be used as a street for the use of the members of theDONEE, their families, personnel, guests, domestic help and, under certain reasonableconditions and restrictions, by the general public, and in the event that said lots or partsthereof cease to be used as such, ownership thereof shall automatically revert to theDONOR. The DONEE shall always have Reposo Street, Makati Avenue, and Paseo deRoxas open for the use of the general public. It is also understood that the DONOR
shall continue the maintenance of the street at its expense for a period of three yearsfrom date hereof." (Deed of Donation, p. 6, Exh. 7) 55
x x x x x x x x x
The donation, on the contrary, gave the general public equal right to it.
The Court cannot then say, accepting the veracity of the petitioners' facts" enumerated above, thatthe Ayala Corporation may be held liable for specific performance of a demandable obligation, letalone damages.
The Court adds that Ayala can hardly be held responsible for the alleged deterioration of "living andenvironmental conditions" 56 of the Bel-Air area, as a consequence of "Ayala's authorized demolitionof the Jupiter perimeter wall in 1974-1975. " 57 We agree with Ayala that until 1976, "there waspeace and quiet" at Jupiter Street, as the petitioners' (Sangalang, Gaston, and Briones) complaintsadmit. Hence, the degeneration of peace and order in Bel-Air cannot be ascribed to the destruction ofthe wall in 1974 and 1975.
What Ayala submits as the real cause was the opening of Jupiter Street to vehicular traffic in 1977.,58 But this was upon orders of the Mayor, and for which the homeowners' association had preciselyfiled suit (Civil Case No. 34998) 59 to contest the act of the Mayor.
c.
This likewise disposes of the third question presented. The petitioners' reliance on Ayala's allegedconduct (proving its alleged commitment), so we have ruled, is not well-taken. Ayala's alleged acts donot, by themselves, reflect a commitment to maintain the wall in dispute. It cannot be therefore saidthat the Court of Appeals "arbitrarily ignore(d]" 60 the lower court's findings. Precisely, it is the duty ofthe appellate court to review the findings of the trial judge, be they of fact or law. 61 It is not bound bythe conclusions of the judge, for which reason it makes its own findings and arrives at its ownconclusions. Unless a grave abuse of discretion may be imputed to it, it may accept or reject thelower tribunal's determinations and rely solely on the records.
Accordingly, the Court affirms the Court of Appeals' holding that the Ayala Corporation, in its dealingswith the petitioners, the Bel-Air Village Association in particular, had "acted with justice, gave theappellees [petitioners] their due and observed honesty and good faith." 62 "Therefore, under bothArticles 19 and 21 of the Civil Code, the appellant [Ayala] cannot be held liable for damages." 63
2. G.R. Nos. 74376, 76394, 78182, & 82281
Our decision also resolves, quite anticlimactically, these companion cases. But we do so for variousother reasons. In the Sangalang case, we absolve the Ayala Corporation primarily owing to ourfinding that it is not liable for the opening of Jupiter Street to the general public. Insofar as thesepetitions are concerned, we likewise exculpate the private respondents, not only because of the factthat Jupiter Street is not covered by the restrictive easements based on the "deed restrictions" butchiefly because the National Government itself, through the Metro Manila Commission (MMC), hadreclassified Jupiter Street into high density commercial (C-3) zone, 64 pursuant to its Ordinance No.81-01. Hence, the petitioners have no cause of action on the strength alone of the said "deedrestrictions.
In view thereof, we find no need in resolving the questions raised as to procedure, since thisdisposition is sufficient to resolve these cases.
It is not that we are saying that restrictive easements, especially the easements herein in question,are invalid or ineffective. As far as the Bel-Air subdivision itself is concerned, certainly, they are valid
and enforceable. But they are, like all contracts, subject to the overriding demands, needs, andinterests of the greater number as the State may determine in the legitimate exercise of police power.Our jurisdiction guarantees sanctity of contract and is said to be the "law between the contractingparties, 65 but while it is so, it cannot contravene 'law, morals, good customs, public order, or publicpolicy. 66 Above all, it cannot be raised as a deterrent to police power, designed precisely to promotehealth, safety, peace, and enhance the common good, at the expense of contractual rights, whenevernecessary. In Ortigas & Co., Limited Partnership v. Feati Bank and Trust Co., 67 we are told:
x x x x x x x x x
2. With regard to the contention that said resolution cannot nullify the contractualobligations assumed by the defendant-appellee referring to the restrictions incorporatedin the deeds of sale and later in the corresponding Transfer Certificates of Title issuedto defendant-appellee it should be stressed, that while non-impairment of contracts isconstitutionally guaranteed, the rule is not absolute, since it has to be reconciled withthe legitimate exercise of police power, i.e., "the power to prescribe regulations topromote the health, morals, peace, education, good order or safety and general welfareof the people.' Invariably described as "the most essential, insistent, and illimitable ofpowers" and "in a sense, the greatest and most powerful attribute of government," theexercise of the power may be judicially inquired into and corrected only if it iscapricious, whimsical, unjust or unreasonable, there having been a denial of dueprocess or a violation of any other applicable constitutional guarantee. As this Courtheld through Justice Jose P. Bengson in Philippine Long Distance Company vs. City ofDavao, et al. police power 'is elastic and must be responsive to various socialconditions; it is not confined within narrow circumscriptions of precedents resting onpast conditions; it must follow the legal progress of a democratic way of life.' We wereeven more emphatic in Vda. de Genuino vs. The Court of agrarian Relations, et al.,when We declared: "We do not see why public welfare when clashing with the individualright to property should not be made to prevail through the state's exercise of its policepower."
Resolution No. 27, 1960 declaring the western part of High way 54, now E. de losSantos Avenue (EDSA, for short) from Shaw Boulevard to the Pasig River as anindustrial and commercial zone, was obviously passed by the Municipal Council ofMandaluyong, Rizal in the exercise of police power to safeguard or promote the health,safety, peace, good order and general welfare of the people in the locality. Judicialnotice may be taken of the conditions prevailing in the area, especially where Lots Nos.5 and 6 are located. The lots themselves not only front the highway; industrial andcommercial complexes have flourished about the place. EDSA, a main traffic arterywhich runs through several cities and municipalities in the Metro Manila area, supportsan endless stream of traffic and the resulting activity, noise and pollution are hardlyconducive to the health, safety or welfare of the residents in its route. Having beenexpressly granted the power to adopt zoning and subdivision ordinances or regulations,the municipality of Mandaluyong, through its Municipal Council, was reasonably, if notperfectly, justified under the circumstances, in passing the subject resolution. 68
x x x x x x x x x
Undoubtedly, the MMC Ordinance represents a legitimate exercise of police power. The petitionershave not shown why we should hold otherwise other than for the supposed "non-impairment"guaranty of the Constitution, which, as we have declared, is secondary to the more compellinginterests of general welfare. The Ordinance has not been shown to be capricious or arbitrary orunreasonable to warrant the reversal of the judgments so appealed. In that connection, we find no
reversible error to have been committed by the Court of Appeals.
WHEREFORE, premises considered, these petitions are DENIED No pronouncement as to costs.
IT IS SO ORDERED.
Fernan, (C.J.), Melencio-Herrera, Gutierrez, Jr., Cruz, Gancayco, Bidin, Cortes, Griño-Aquino,Medialdea and Regalado, JJ., concur.
Narvasa, J., on leave.
Paras, J., Took no part;
Feliciano, J., Took no part;
Padilla, J., Took no part;
Footnotes
1 Consolidated pursuant to our Resolution dated July 18, 1988.
2 ollo, G.R. No. 71169, 102-113. The decision of the Court of Appeals makes mentionof specified areas in Makati having been converted into a "High Intensity CommercialZone" as well as "Low Intensity Residential" (see page 9 of this Decision). This shouldbe either "high" or "low" density.
3 Jurado Desiderio, J.; Campos, Jr., Jose and Camilon, Serafin, JJ., Concurring.Pascual, Crisolito J., Dissenting. The decision set aside, dated October 1, 1982, waspenned by Hon. Gregorio Pineda, Presiding Judge, Court of First Instance of Rizal,Seventh Judicial District, Pasig, Metro Manila, Branch XXI.
4 Rollo, Id., 128.
5 Civil Case No. 49217, Hon. Rafael T. Mendoza, Presiding Judge; rollo, G.R. No.74376, 82.
6 Rollo. Id.
7 Camilon, Serafin, J.; Pascual. Crisolito Campos Jr., Jose, and Jurado, Desiderio, JJ.Concurring.
8 Rollo, Id., 34; emphasis in original.
9 Rollo, G.R. No. 76394, 24-25.
10 Civil Case No. 33112; see Id., 8, 10.
11 Jurado, Desiderio, J.; Campos, J., Jose and Camilon, Serafin JJ. Concurring;Pascual, Crisolito J., Chairman, on leave.
12 First Division.
13 Rollo, Id., 81.
14 Per Resolution, dated February 22, 1988.
15 Per Resolution, dated April 4, 1988.
16 See fn. 1, supra.
17 Rollo, G.R, No. 78182, 36-38.
18 Camilon, Serafin, J.; Pronove, Ricardo and Cacdac, Bonifacio, JJ., Concurring.
19 Civil Case No. 27719, Regional Trial Court, Makati, Branch 145.
20 Rollo, G.R. No. 82281, 33-35.
21 Civil Case No. 8936, Regional Trial Court of Makati, Branch CXL, Hon. Ansberto P.Paredes, presiding, see Id., 32.
22 Bengzon, Eduardo, J.; Kapunan, Santiago and Buena, Arturo, JJ., Concurring.
23 Rollo, Id., 38.
24 See supra, 103-108.
25 Id., 32.
26 Id., 38.
27 Id., 50-51.
28 78 Phil. 196 (1947).
29 Supra, 209; emphasis supplied.
30 No. L-14551, July 31, 1961, 2 SCRA 873.
31 Supra 877.
32 Supra.
33 No. L-60129, July 29, 1983, 123 SCRA 799.
34 The rule states: Questions that may be decided. No which does not affect thejurisdiction over the subject matter will be considered unless stated in the assignment oferrors and properly argued in the brief, save as the court, as its option, may notice plainerrors See rollo, G.R. No. 71169, Id., 168. The pertinent paragraph of the answerstates:
10. That in 1975, the Municipal Government of Makati enacted a zoning ordinance andclassified the blocks between Buendia Avenue Extension and Jupiter Street as anadministrative office zone with the north-northeast boundary of the zone extending up tothe center line of Jupiter street. Under the said ordinance, Bel-Air Village has likewisebeen called into a residential zone, with its boundary at the southwest being delimitedonly up to the center line of the Jupiter Street. Similarly, under Ordinance No. 81-01 ofthe Metro Manila Commission, Jupiter Street has been made a common boundary ofthe commercial blocks along the north side of the Buendia Avenue Extension and theBel-Air Village Subdivision, so that the said street is subject to the common use of theowners of both the commercial blocks as well as the residential areas.
11. That the restoration reconstruction of the wall on the blocks along the southern sideof Jupiter Street will come the entire southside portion of Jupiter Street and will illegally
deprive the abutting lot owners on the commercial blocks of their rights to have thestreet kept open and to have access to the street, in violation of Act 496, as amendedby Republic Act 440.
36 See Id., 169.
37 Exhibits Nos. "18" and "19"; see Id., 168.
38 Id., 116.
39 Id.
40 Id., 66.
41 Rollo, G.R. No. 71169, Id., 124.
42 Id.
43 Id.
44 Id., 124-126; emphasis in original.
45 Id., 52.
46 CIVIL CODE, art. 1157, par. (2).
47 Supra, art. 1305.
48 This case should be distinguished from Perez v. Pomar, 2 Phil.
49 Rollo, Id., 38.
50 Id., 40.
51 Id., 47.
52 Id., 183-185.
53 Id., 92.
54 Id., 105-106.
55 Id., 193; emphasis in original.
56 Id., 45.
57 Id.
58 Id., 108-110.
59 Id., 193.
60 Id., 38.
61 RULES OF COURT, Rule 46, sec. 18.
62 Rollo, G.R. No. 71169, Id., 126.
63 Id.
64 See rollo, G.R. No. 71169, Id., 117.
65 CIVIL CODE, supra, art. 1159.
66 Supra, art. 1306.
67 No. L-24670, December 14, 1979, 94 SCRA 533.
68 Supra, 545-547.
