Can the open space be converted into a residential lot?

Can the open space in a subdivision be sold and converted into a residential lot?

Please be informed of Presidential Decree 1216, which defines the term "open space" as an area reserved exclusively for parks, playgrounds, recreational uses, schools, roads, places of worship, hospitals, health centers, barangay centers, and other similar facilities and amenities. Moreover, Section 2 thereof states:

"Section 2. Section 31 of Presidential Decree No. 957 is hereby amended to read as follows:

"Sec. 31. Roads, Alleys, Sidewalks and Open spaces. The owner as developer of a subdivision shall provide adequate roads, alleys and sidewalks. For subdivision projects one (1) hectare or more, the owner or developer shall reserve thirty percent (30%) of the gross area for open space. Such open space shall have the following standards allocated exclusively for parks, playgrounds and recreational use:

"(a) 9% of gross area for high density or social housing (66 to 100 family lot per gross hectare).

"(b) 7% of gross area for medium-density or economic housing (21 to 65 family lot per gross hectare).

"(c) 3.5% of gross area low-density or open market housing (20 family lots and below per gross hectare).

"These areas reserved for parks, playgrounds and recreational use shall be non-alienable public lands, and non-buildable. The plans of the subdivision project shall include tree planting on such parts of the subdivision as may be designated by the Authority.

Upon their completion as certified to by the Authority, the roads, alleys, sidewalks and playgrounds shall be donated by the owner or developer to the city or municipality and it shall be mandatory for the local governments to accept provided, however, that the parks and playgrounds may be donated to the Homeowners Association of the project with the consent of the city or municipality concerned. No portion of the parks and playgrounds donated thereafter shall be converted to any other purpose or purposes."

Under the abovementioned provision of law, the parcel of land in a subdivision designated as an open space must be exclusively used for open space purposes such as parks, playgrounds, recreational uses, schools, roads, places of worship, hospitals, health centers, barangay centers, and other similar facilities and amenities and may not be converted to any other purposes.

In the case of White Plains Association, Inc. v. Legaspi (GR 95522, Feb. 7, 1991), the Supreme Court, through Associate Justice Emilio Gancayco, held:

"Subdivision owners are mandated to set aside such open spaces before their proposed subdivision plans may be approved by the government authorities, and that such open spaces shall be devoted exclusively for the use of the general public and the subdivision owner need not be compensated for the same. A subdivision owner must comply with such requirement before the subdivision plan is approved and the authority to sell is issued."

Hence if a lot is indeed designated as the subdivision's open space, it should be exclusively utilized as such and cannot be sold as a residential lot.

Source: Manila Times

Notice to mortgagor is required prior to extrajudicial foreclosure

Foreclosure of property is a remedy used to satisfy an obligation in case the debtor defaults on his or her obligation.

Foreclosure can be judicial or extrajudicial, the latter being governed by Act 3135, as amended by Act 4118, or "An act to regulate the sale of property under special powers inserted in or annexed to real estate mortgages."

A careful reading of this law shows that the only notice required is found in Section 3 thereof, which provides:

"SEC. 3. Notice shall be given by posting notices of the sale for not less than twenty days in at least three public places of the municipality or city where the property is situated, and if such property is worth more than four hundred pesos, such notice shall also be published once a week for at least three consecutive weeks in a newspaper of general circulation in the municipality or city."

Notably, and as consistently ruled in the past by the Supreme Court, personal notice to the mortgagor is not required as the only notice required under this law is a notice of sale to the public. However, in the recent case of Philippine Savings Bank v. Josephine Co (GR 232004, Oct. 6, 2021, Ponente: Associate Justice Marvic M.V.F Leonen), the Supreme Court revisited this interpretation, stating:

"Notwithstanding the absence of an express directive under Act No. 3135, principles of due process and the utmost diligence of banks require that mortgagors be personally notified of extrajudicial foreclosures of their mortgages prior to public auctions.

"Due process requires that a mortgagor be notified, to afford him or her an opportunity to safeguard his or her rights prior to the extrajudicial foreclosure of his or her mortgage, and the sale of his or her property. The current reading of Act No. 3135 affords no safeguards whatsoever for the mortgagor. The publication requirement under Act No. 3135 is not intended as a notification for the mortgagor, but rather for the public, to enable participation in the auction sale of the foreclosed property."

The extrajudicial foreclosure made without your knowledge or personal notice may be held null and void as it violates your right to due process. Such action amounts to a deprivation on your part of any opportunity to exhaust all possible legal remedies to protect your interest.

Bill extends foreigner land leases to 99 years

The senate approved a bill on Monday extending the maximum term for land leases entered into by foreign investors, and another measure reorganizing the socio-economic planning agency.

Senate Bill No. 2898, which seeks to amend the 31-year-old Investors’ Lease Act, extends the term for foreign leases to 99 from 75 years.

Under the current setup, foreign investors may lease private land for an initial period of 50 years, renewable for a further 25 years.

The latest bill, which is among the measures that Congress seeks to pass before the midterm elections, also allows foreign investors to sublet properties unless barred by contract.

The proposal will also allow foreign investors to lease land for agriculture, agroforestry and ecological conservation.

Senate President Francis Joseph G. Escudero said the bill is in line with government efforts to attract foreign investment, which he called “critical in realizing socio-economic objectives such as increasing employment levels, creating decent work, infusing technology into domestic businesses, and improving the integration of local enterprises with the global market.”

“This bill seeks to address this economic roadblock by strengthening the legal framework for long-term leases provided under Republic Act No. 7652,” he said in a statement.

The Senate also passed on third and final reading a bill seeking to reorganize the National Economic and Development Authority into the Department of Economy, Planning and Development (DEPDev). 

The bill positions DEPDev “as the government’s primary policy, planning, coordinating and monitoring body for economic development.”

Source: Business World