Hulst

v. PR Builders
532 SCRA 74, G.R. No. 156364

Doctrine:
Since petitioner and his wife, being Dutch nationals, are proscribed under the Constitution
from acquiring and owning real property, it is unequivocal that the Contract to Sell entered
into by petitioner together with his wife and respondent is void. As Sec. 7, Article XII of the
Constitution provides, "Save in cases of hereditary succession, no private lands shall be
transferred or conveyed except to individuals, corporations, or associations qualiCied to
acquire or hold lands of the public domain." The capacity to acquire private land is made
dependent upon the capacity to acquire or hold lands of the public domain. Private land
may be transferred or conveyed only to individuals or entities "qualiCied to acquire lands of
the public domain." The 1987 Constitution reserved the right to participate in the
disposition, exploitation, development and utilization of lands of the public domain for
Filipino citizens or corporations at least 60 percent of the capital of which is owned by
Filipinos. Aliens, whether individuals or corporations, have been disqualiCied from
acquiring public lands; hence, they have also been disqualiCied from acquiring private lands.

Facts:
The Petitioner and his spouse, both Dutch Nationals, entered into a Contract to Sell with PR
Builders, Inc. to purchase a 210-sq m residential unit in the respondent's townhouse
project in Batangas.

When PR Builder's failed to comply with their verbal promise to complete the project, the
s p o u s e s H u l s t C i l e d a c o m p l a i n t f o r r e s c i s s i o n
of contract with interest, damages and attorney's fees before the Housing and Land
Regulatory Board (HLURB), which then was granted.

A Writ of Execution was then addressed to the Ex - OfCicio Sheriff of the RTC of Tanauan,
Batangas, but upon the complaint of the respondent, the levy was set aside, leaving only the
respondent’s personal properties to be levied Cirst. The Sheriff set a public auction of the
said levied properties. However, the respondent Ciled a motion to quash the writ of levy on
the ground that the sheriff made an over levy, with the aggregate appraised value of the
properties pegged at P6,500 per square meter or P83,616,000. Instead of resolving the
objection of the respondent's regarding the auction, the Sheriff proceeded with the auction
since there was no restraining order from the HLURB. The 15 parcels of land was then
awarded to Holly Properties Realty at a bid of P5,450,653. On the same day, the Sheriff
remitted the legal fees and submitted to contracts of sale to HLURB, however, he then
received orders to suspend proceedings on the auction for the reason that the market value
of the properties was not fair. There was disparity between the appraised value and the
value made by the petitioner and the Sheriff, which should've been looked into by the
Sheriff before making the sale. While an inadequacy in price is not a ground to annul
such sale, the court is justiCied to such intervention where the price shocks the conscience.
The CA afCirmed the HLURB’s decision. Thus, this petition in the Supreme Court alleging
that the CA committed grave abuse of discretion in setting aside the levy made by the
sheriff on the subject properties.
However, before addressing such question, the Court deemed it proper to Cirst address the
issue of whether the petitioners who are foreign nationals are disqualiCied under the Sec 7,
Art XII of the 1987 Constitution from owning real property in their names.

Issue: W/N petitioners, being foreign nationals, are prohibited from owning real property
in their name and therefore, the subject Contract to Sell is void?

Held:
Yes.

Since petitioner and his wife, being Dutch nationals, are proscribed under the Constitution
from acquiring and owning real property, it is unequivocal that the Contract to Sell entered
into by petitioner together with his wife and respondent is void. As Sec. 7, Article XII of the
Constitution provides, "Save in cases of hereditary succession, no private lands shall be
transferred or conveyed except to individuals, corporations, or associations qualiCied to
acquire or hold lands of the public domain." The capacity to acquire private land is made
dependent upon the capacity to acquire or hold lands of the public domain. Private land
may be transferred or conveyed only to individuals or entities "qualiCied to acquire lands of
the public domain." The 1987 Constitution reserved the right to participate in the
disposition, exploitation, development and utilization of lands of the public domain for
Filipino citizens or corporations at least 60 percent of the capital of which is owned by
Filipinos. Aliens, whether individuals or corporations, have been disqualiCied from
acquiring public lands; hence, they have also been disqualiCied from acquiring private lands.