The Learning Child, Inc. (TLC) v.

Ayala Alabang Village Association (AAVA), right and power to enforce the restrictions on the properties in the Ayala Alabang
G.R. No. 134269 Village to the association of homeowners, the AAVA.
Date: July 7, 2010 | Ponente: Leonardo-De Castro, J.  Establishment of TLC and Expansion – In 1989, the spouses opened on the
same lot The Learning Child Pre-school which initially consisted of nursery and
Doctrine: Contracts Clause; Limitations on the use of land imposed by contract yield kindergarten classes. In 1991, it was expanded to include a grade school
to reasonable exercise of police power and, hence, zoning ordinances are superior to program, the School of the Holy Cross.
contractual restrictions on the use of property.  AAVA Protest – The AAVA filed with the RTC of Makati an action for injunction
against TLC and the spouses Alfonso, alleging breach of contract by the
Summary: The case is 3 consolidated petitions for review on certiorari concerning defendant spouses of the Deed of Restrictions.
the operation of The Learning Child, a preparatory AND grade school located in Ayala  RTC of Makati – Rendered a Decision in favour of AAVA, emphasizing that the
Alabang Village. AAVA filed an injunction case against TLC and the spouses Alfonso restrictions were in reality an easement which an owner of a real estate may
for violating the Deed of Restrictions which limits the use of the lot to a preparatory validly impose under Article 688 of the Civil Code.
(nursery and kindergarten) school. The Supreme Court held that AAVA’s and ALI’s  Motion for Reconsideration – TLC alleged that with the passage of Muntinlupa
insistence on (1) the enforcement of the Deed of Restriction or (2) the obtainment of Zoning Ordinance No. 91-39 which reclassified the subject property as
the approval of the affected residents for any modification of the Deed of Restrictions “institutional,” there ceased to be legal basis for the RTC to uphold the Deed of
is reasonable absent any interest or zoning purpose asserted by the Municipality Restrictions. RTC agreed and set aside its earlier Decision. Citing Ortigas & Co.
contrary to that of the subdivision developer in declaring the subject property as Limited Partnership v. Feati Bank & Trust Co., it decreed that while the non-
institutional. impairment of contracts is constitutionally guaranteed, the rule is not absolute
since it has to be reconciled with the legitimate exercise of police power by the
Deed of Metropolitan Muntinlupa Muntinlupa municipality.
Restrictions Manila Zoning Ordinance Resolution No.  CA – Upon appeal by the AAVA, it set aside the Resolution of the RTC and
Commission No. 91-39 94-179 reinstated the previous decision in favour of AAVA. TLC and spouses Alfonso
Ordinance No. filed a Motion for Reconsideration from this Decision but was denied.
81-01  Motion to Intervene – Aquino, et al., students of TLC, alleging that they are
“USE AND Classified Ayala Reclassified the Corrected a minor children who suffer from various learning disabilities and behavioural
OCCUPANCY – Alabang Village for subject property as typographical error disorders benefiting from TLC’s full-inclusion program, filed a Motion for Leave to
The property shall zoning purposes “institutional” in the description Intervene and their own Motion for Reconsideration with the CA. The CA denied
be used as a low-density of a parcel of land their Motions for being proscribed by Section 2, Rule 19 of the 1997 Rules on
exclusively for the residential area, under the heading Civil Procedure.
establishment and thereby limiting the “Institutional  Zoning Ordinance Case – In the meantime, the Municipality of Muntinlupa
maintenance use of the subject Zone” in Appendix passed Resolution No. 94-179 correcting an alleged typo on abovementioned
thereon of a property to the B of Ordinance Ordinance No. 91-39, effectively placing Lot 25, Block 3, Phase V (herein subject
preparatory establishment or No. 91-39 , lot) under the “Institutional Zone.”
(nursery and operation of a adjusting the o HLURB – According to the Housing and Land Use Regulatory Board
kindergarten) nursery and description “Lot (HLURB), the Resolution was not a mere correction of a typo but an
school, which may kindergarten 25, Block 1, Phase actual rezoning of the property into an institutional area and would
include such school, which V, Ayala Alabang” require the conduct of public hearings.
installations as an should not exceed to “Lot 25, Block 3, o Office of the President – The Office of the President set aside this
office for school two classrooms. Phase V, Ayala conclusion of the HLURB and declared Resolution No. 94-179 as a valid
administration, Alabang” corrective issuance. It further held that the Deed of Restrictions had lost
playground and its force and effect in view of the passage of Ordinance No. 91-39.
garage for school o CA – The CA upheld the validity of Resolution No. 94-179 but held that
vehicles.” the Office of the President erred; that Ordinance No. 91-39 did not have
the effect of nullifying the Deed of Restrictions inasmuch as there is no
Facts: conflict between the two.
 Sale of Lot 25, Block 3, Phase V, Ayala Alabang – Ayala Land Inc. (ALI) sold
this parcel of land to spouses Yuson. They then sold it to spouses Alfonso. A Issues/Ratio:
Deed of Restrictions was annotated on the TCT which expressly provides that,
“the property shall be used exclusively for the establishment and maintenance  WON the CA is correct in upholding the validity of Muntinlupa Resolution
thereon of a preparatory (nursery and kindergarten) school.” ALI turned over the No. 94-179  YES, being a mere corrective issuance, it is not invalidated by the
lack of notice and hearing as AAVA contends.
 o Both the Official Zoning Map of Muntinlupa and that of the Ayala apparently conflicting rights under the Constitution and to
Alabang Village show that the subject lot is classified as “institutional.” preserve both instead of nullifying one against the other.”
The official zoning map is an indispensable and integral part of a zoning  Presley v. Bel-Air Village Association: The Court allowed the
ordinance, without which said ordinance would be considered void. operation of the Hot Pan de Sal Store despite the Deed of
o It is clear that there was a typo and the Court is merely affirming the Restrictions, but not without examining the surrounding area
correction made by the same entity which committed the error. like in Ortigas.
o The authority of the HLURB is subordinate to that of the Office of the o SC: The subject property, though declared as an institutional lot,
President and the acts of the former may be set aside by the latter. nevertheless lies within a residential subdivision and is surrounded by
residential lots. TLC’s student population had swelled to 350 students.
 WON the CA was correct in denying Aquino, et al.’s Motion to Intervene  The greater traffic will affect adjacent property owners’ enjoyment and
MOOT, since their motion was filed in 1998, Aquino, et al., would no longer be in use of their own properties. AAVA’s insistence on the enforcement of
grade school at this time. the Deed of Restrictions is thus reasonable. Also, the Municipality of
o For the sake of argument, the Court finds no reversible error in CA’s Muntinlupa did not appear to have any special justification for declaring
denial of their Motion. The motion was filed three months after the CA the subject lot as an institutional property.
had already rendered its Decision.
o Section 2, Rule 19 of the 1997 Rules on Civil Procedure clearly imports  WON AAVA is estopped from enforcing the Deed of Restrictions  NO
that intervention cannot be allowed when the trial court has already o TLC and spouses Alfonso: The AAVA had allegedly abrogated said
rendered its Decision, and much less, as in the instant case, when even restrictions by its own acts.
the CA had rendered its own Decision on appeal. o However, TLC and the spouses Alfonso failed to prove by clear and
convincing evidence the gravity of AAVA’s acts so as to bar the latter
 WON TLC and the spouses Alfonso should be enjoined from continuing the from insisting compliance.
operation of a grade school in the subject property  YES, sub-issues o The circumstances around the enumerated acts of AAVA also show that
below: there was no intention on the part of AAVA to abrogate the Deed of
Restrictions nor to waive its right to have said restrictions enforced.
 WON Muntinlupa Municipal Ordinance No. 91-39, as corrected by o Finally, a thorough examination of the records of the case shows that
Muntinlupa Resolution No. 91-179, has the effect of nullifying the AAVA consistently insisted upon compliance with the Deed of
provisions of the Deed of Restrictions on the subject property  NO, there Restrictions.
is a way to harmonize the seemingly opposing provisions.
o TLC and spouses Alfonso: Reclassification of properties is a valid Ruling: TLC and the spouses Alfonso are ordered to CEASE AND DESIST from the
exercise of the state’s police power, with which contractual obligations operation of the Learning Child School beyond nursery and kindergarten. The current
should be reconciled. students will be allowed to finish their elementary studies up to their graduation in
o AAVA: Even where the exercise of police power is valid, the same does Grade 7. Enrollment of new grade school students will no longer be permitted.
not operate to automatically negate all other legal relationships in
existence since the better policy is to reconcile the conflicting rights.
o Review of jurisprudence:
 Ortigas & Co. Limited Partnership v. Feati Bank & Trust Co:
The Court, in upholding the exercise of police power attendant
in the reclassification of the subject property therein over the
Deed of Restrictions over the same property, took into
consideration the prevailing conditions in the area. “Resolution
was passed in the exercise of police power to safeguard or
promote the health, safety, peace, good order and general
welfare of the people in the locality.”
 Co v. Intermediate Appellate Court: The Court denied the
applicability of reclassification. “This is not to suggest that a
zoning ordinance cannot affect existing legal relationships for it
is settled that it can legally do so, being an exercise of police
power. As such, it is superior to the impairment clauses. xxx
The zoning ordinance in question, while valid as a police
measure, was not intended to affect existing rights protected
by the impairment clause. It is always a wise policy to reconcile