Condo unit buyer can stop paying instalments on unfinished project

Persida Acosta

Persida Acosta

Dear PAO,
I purchased a condominium unit on instalment basis from a real estate developer. They said that the project would be finished by the beginning of the year, and I would be able to move in to my unit. However, the real estate company failed to complete the project on time. Worse, the project seems like it cannot be finished any time soon. What are my remedies under the situation?
Mary Jean

Dear Mary Jean,
A condominium owner or developer is obliged to comply with the contractual obligations that arise from agreements it executed, as well as the legal obligations that the laws impose upon it. In case of failure to comply, the injured party, often the buyer, is entitled to the protection and remedies provided by the laws.

Pertinent to the matter at hand is Section 20 of Presidential Decree No. 957, otherwise known as the Subdivision and Condominium Buyer’s Protective Decree, which essentially states that a buyer has two (2) remedies in case the condominium owner or developer fails to complete the project according to the approved plans and within the specified time limit, to wit: (1) the buyer may suspend amortization payment until such time that the condominium owner or developer complies with his obligation; or (2) the buyer may demand reimbursement of the total amount he or she paid with legal interest less interest paid on account of delinquency. The option to choose which remedy to avail is given to the buyer who is the aggrieved party in the situation.

Should the buyer choose the option to suspend amortization payment, the buyer is required by law to merely notify the condominium owner or developer of the decision to suspend payment on account of the latter’s failure to comply with its obligation to complete the project to enforce such right. The law does not prescribe any form of notice to make the right effective. Hence, it need not be in written form. A verbal notice would suffice (Zamora Realty and Development Corporation vs. Office of the President, 506 SCRA 591).

Moreover, the law does not require the buyer to secure a clearance from the Housing Land Use and Regulatory Board (HLURB) before exercising such right (Francel Realty Corporation v. Sycip, 469 SCRA 424). Thus, the buyer may exercise the right to suspend payment without any need of going to court or quasi-judicial body.

On the other hand, should the buyer opt to avail of the remedy to demand reimbursement of the total amount paid, he or she may do so by demanding refund from the condominium owner or developer. If the latter unjustifiably refuses or unreasonably delays in giving reimbursement, the buyer may file a complaint before the HLURB which has jurisdiction to hear and decide claims involving refund and any other claims filed by subdivision lot or condominium unit buyer against the project owner, developer, dealer, broker or salesman (PBCom vs. Pridisons Realty Corporation, 688 SCRA 200).

We hope the foregoing sufficiently answered your query. Please bear in mind that our opinion is based solely on the facts you narrated and our appreciation of the same. Our opinion may vary should actual facts and circumstances change.

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


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