Cabral v. Uy
REITERATIONFacts
The Antecedents: Respondent Jacinto Uy, as chairman of Moldex Realty, Inc., entered into a joint venture with Quintin Bernardo to incorporate two parcels of land totaling 20,954 square meters, held by Bernardo under Emancipation Patents Nos. 446684 and 446685, into Moldex's residential subdivision project in Bulacan. On June 21, 2001, Moldex applied for a license to sell the subdivision lots with the HLURB, but the application was denied on May 2, 2002 for non-compliance with requirements. Despite the denial, Moldex sold a subdivision lot to Josefa C. Yanga without the required license. Petitioner Victoria P. Cabral, claiming ownership of the lots subject to Bernardo's patents and having previously refused Uy's offer to buy due to her pending cancellation case before the DARAB, filed a criminal complaint on July 2, 2002 against Uy and other Moldex officers/directors (Michael Uy, Marilyn O. Uy, Richard O. Uy, Rey Ignacio Diaz, Jose Po, and Juanito Malto) for violation of Section 5, P.D. 957. On September 17, 2003, HLURB subsequently issued the license to sell to Moldex. Procedural History: On April 28, 2003, the Quezon City Prosecutor's Office filed an Information in Criminal Case Q-03-116823 before the RTC Branch 83, Quezon City, charging respondents with selling the lot without license. Respondents filed a motion to quash and for judicial determination of probable cause, arguing lack of jurisdiction (claiming exclusive HLURB cognizance) and extinction of liability due to the subsequent license. On May 20, 2004, Judge Estrella T. Estrada denied the motions; on June 15, 2005, Judge Ramon A. Cruz denied reconsideration. Respondents appealed to the CA via CA-G.R. SP 90468, which issued a TRO; on June 2, 2006, the CA upheld jurisdiction but dismissed the case due to the subsequent license, denying petitioner's MR on August 22, 2006. The Petition: Petitioner Cabral assailed the CA decision, arguing prosecutors and courts have jurisdiction per Sia v. People and that the subsequent license does not extinguish criminal liability for malum prohibitum violation. Respondents countered that HLURB has exclusive jurisdiction and good faith/subsequent compliance bars prosecution. The OSG joined petitioner, representing the People.
Issue(s)
Whether or not the office of the public prosecutor and the trial court have jurisdiction over criminal actions for violation of P.D. 957; Whether or not HLURB's subsequent issuance to Moldex of a license to sell extinguished respondents' criminal liability for selling subdivision lots prior to the issuance of such license.
Ruling
The petition is GRANTED; the CA Decision (June 2, 2006) and Resolution (August 22, 2006) in CA-G.R. SP 90468 are REVERSED and SET ASIDE; the RTC Order (May 20, 2004) denying respondents' motions is REINSTATED.
Ratio Decidendi
On Issue 1: The Court reiterated its ruling in Sia v. People (G.R. No. 159659, October 12, 2006, 504 SCRA 507), affirming that public prosecutors have authority to investigate and file Informations for violations of P.D. 957, and Regional Trial Courts have jurisdiction to try such cases, as the penalty under Section 39 (fine up to P20,000 and/or imprisonment up to 10 years) falls within RTC exclusive original jurisdiction per B.P. 129, as amended. HLURB's role is limited to administrative regulation and fines under Section 38 (up to P10,000), not criminal prosecution, which remains with regular courts to enforce penal sanctions. This jurisdictional allocation ensures separation of regulatory oversight from judicial punishment, preventing forum-shopping and upholding prosecutorial control over criminal actions as mandated by law. Respondents' claim of exclusive HLURB jurisdiction was rejected, as no provision in P.D. 957 divests courts of cognizance over its penal clauses. The CA correctly upheld this, aligning with precedents emphasizing that special laws with imprisonment penalties are judicially cognizable unless expressly assigned elsewhere. On Issue 2: Violation of Section 5, P.D. 957, prohibiting sales without HLURB license, is malum prohibitum, a special law offense protecting public welfare in subdivision developments, where commission of the prohibited act (selling without license) consummates the crime regardless of malice, intent, good faith, or effect, as held in Go v. Sandiganbayan (G.R. No. 172602, September 3, 2007) and Garcia v. CA (G.R. No. 157171, March 14, 2006). The Information sufficiently alleged the sale to Yanga pre-license, establishing prima facie the offense; subsequent license issuance on September 17, 2003, cannot retroactively erase liability, as crimes are not extinguished by post-facto compliance in malum prohibitum. The CA erred in relying on Co Chien v. Sta. Lucia Realty (G.R. No. 162090, January 31, 2007, 513 SCRA 570), a civil case for refund where contract validity was upheld absent fraud but an administrative fine imposed, illustrating that civil remedies differ from criminal ones—penal liability persists independently. P.D. 957's purpose demands strict enforcement to deter pre-license sales, holding corporate officers vicariously liable under Section 39. Thus, the RTC properly denied quashal, as allegations, assumed true, state a valid offense unextinguished by later events.
Main Doctrine
The sale of subdivision lots or condominium units without a prior license to sell from the HLURB constitutes a violation of Section 5, P.D. 957, punishable under Section 39 thereof with a fine not exceeding P20,000 and/or imprisonment not exceeding 10 years, rendering corporate officers criminally liable as malum prohibitum. Such offenses are within the exclusive original jurisdiction of Regional Trial Courts and prosecutable by public prosecutors, as affirmed in Sia v. People, since the penalties exceed those cognizable by lower courts. The crime is consummated upon the prohibited act of selling without license, irrespective of malice, good faith, or injurious effect, as the law's prohibitive intent protects public welfare in real estate transactions. Subsequent issuance of the license does not retroactively erase the offense or extinguish criminal liability, distinguishing administrative remedies from penal sanctions. This doctrine underscores P.D. 957's regulatory purpose to prevent fraudulent sales, holding developers accountable even if projects later comply.