Bel-Air v.

Dionisio
Fact:
- Plaintiff filed a complaint for the collection of sum (P2,100, penalty, attorneys
fee) representing the association dues assessed on the lot owned by the
Defendant as a member of said association. The defendant in his avers that:
there is no privity of contract between them, the collection of dues is an
unlawful exercise of power of taxation, the amount assessed is unreasonable
and oppressive, that he has not affiliated himself with the defendant
association, and that compelling him to be a member thereof is
unconstitutional.
- The By-laws of the association provides that: every owner and purchaser of
lots located inside the village shall automatically become a member of the
association; that the association is run and managed by a Board of Governors
who has the power to assess and collect against every owner certain
amounts based on the area of the lot owned by every member; that unpaid
dues constitute a lien on the lots of the owners
- It also appears that the TCT over the lot issued in the name of Dionisio
contains an annotation that the lot owner shall become an automatic
member of the association, must abide by its rules and regulation.
- MTC Makati ruled in favour of the plaintiff;CFI affirmed; CA certified the case
to SC (since it involves a question of law)
Issue:
- Whether or not the Bel-Air can lawfully collect the questioned dues from the
petitioner
- Whether or not Dionisio is bound by the annotation on his TCT. (see below
Held: Yes, Yes
Ratio:
- Sec. 39 of the Land Registration Act provides that every person receiving a
certification of title in pursuance of a decree of registration, and every
subsequent purchaser of registered land who takes a certification of
title for value in good faith shall hold the same free of all
encumbrances except those noted on said certificate.
- Thus, purchasers of a registered land are bound by the annotations found
at the back of the certification of titles covering the subject parcel of land.
- The contention that there is no privity of contract is not persuasive because
by the purchase of the subject land, Dioisio accepted the land free from
encumbrances except from the annotation. By virtue of said annotation,
Dionisio automatically became a member of the association and bound
himself to perform certain obligations, one of which is the payment of
association dues collected by the Board of Governors.
- The sum collected is not in the nature of a property tax; they are shares in
the common expenses for necessary services and the collection of which is
expressly annotated in the TCT. And, such services being necessary, the
amount is not unreasonable and oppressive.
- No infringement of right of association because such constitutional
proscription applies only to government acts and not to private transactions
like the one in question. Also, the limitation is not imposed upon his capacity

to contract or associate himself, but upon his ownership of property. He can

at any time exercise his inviolable freedom in disposing the property and free
himself of the burden of becoming a member of the association.