Dear PAO,

I recently bought a parcel of land inside an exclusive subdivision, which I intend to keep as an investment. Three weeks ago, I received an email from the subdivision’s homeowners’ association demanding the payment for three months’ worth of association dues on my vacant lot. This surprised me, considering that my lot remains unoccupied and undeveloped. Can they validly impose association dues on lots without actual occupants? From my understanding, association fees are collected to cover the costs of maintenance of shared spaces and amenities within the subdivision. Given that I don’t intend on actually residing therein, can I validly refuse to pay the fees?

Owen

Dear Owen,

The authority of a homeowners’ association (HOA) to collect from a homeowner such fees, dues, and assessments that may be provided for in the bylaws and approved by a majority of its members finds its basis in Republic Act (RA) 9904, otherwise known as the Magna Carta for Homeowners and Homeowners’ Associations. (Section 3, RA 9904)Indeed, an association may “[i]mpose or collect reasonable fees for the use of open spaces, facilities, and services of the association to defray necessary operational expenses, subject to the limitations and conditions imposed under the law, the regulations of the board and the association’s bylaws.” (Section 10, RA 9904)

The 2021 Revised Implementing Rules and Regulations of RA 9904 under Department of Human Settlements and Urban Development (DHSUD) Department Order (DO) 2021-007, series of 2021, which took effect on Sept. 15, 2021, defines “homeowner” and “residential real property” as “[a]n owner or purchaser of a lot in a subdivision/village,” and “any real property, the use of which is limited by law to primarily residential purposes.” (Section 4, DO 2021-007, s. 21)

From the definition provided under Section 4 of DO 2021-007, s. 21, owners or buyers of lots — whether developed or undeveloped, occupied or unoccupied — are deemed homeowners within the purview of RA 9904. More often than not, dues and assessments are based on both acquisition of property and membership in the homeowners’ association, as opposed to actual and physical occupancy of the property. Consequently, even owners of undeveloped and unoccupied lots may be subjected to the payment of duly approved fees, dues, and assessments.In your case, it is crucial to check the HOA governing documents, such as its bylaws, the subdivision’s Master Deed and Declaration of Restriction, or even your contract, to ascertain the guidelines regarding the imposition of dues. In case there is an express provision in any of the governing documents which exclude the owners of vacant lots from assessments, fees, and dues, then the assessment made on your lot shall be deemed invalid.

Accordingly, you may file a complaint before the Human Settlements Adjudication Commission’s (HSAC) Regional Adjudication Board (RAB) where the association is registered, as it has jurisdiction over “[i]ntra-association disputes or controversies arising out of the relations between and among members of HOAs; between any or all of them and the HOA of which they are members.” (HSAC En Banc Resolution 8, March 2, 2021)

We hope that we were able to answer your queries. This advice was based solely on the facts you have narrated and our appreciation of the same. Our opinion may vary when other facts are changed or elaborated.

Thank you for your continued trust and support.

Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to [email protected]