Can a Homeowner-Member Refuse to Pay Monthly Dues Because of Poor Service?

Indeed, the essence of community life is association and cooperation for without these such broader welfare goals cannot be attained.

– Mr. Justice Hugo E. Gutierrez, Jr., in Bel Air Village Association, Inc. v. Dionisio

By Realttorney^®

Ms. Beth left a question on the website which is very much relevant in today’s realities as a homeowner-member in a Homeowners Association (HOA). Here is the question:

“Do I have the right not to pay the monthly due because the association’s officers failed to do their responsibilities of protecting the rights of the neighborhood against loud noise and maintaining the vacant lot? I hire people to clean the area and cut the tall grasses. I intend not to pay the monthly due to refund the amount I spent for cleaning the area. According to our officers, it is my responsibility to clean the vacant lot adjacent to me.”

Before we answer the question of Ms. Beth let me discuss first the rights and duties of a Homeowner pursuant to Sections 7 and 8 of Republic Act No. 9904, otherwise known as the “Magna Carta for Homeowners and Homeowners’ Associations”.

Under the Magna Carta, an association member has full rights:

1. to avail of and enjoy all basic community services and the use of common areas and facilities;
2. to inspect association books and records during office hours and to be provided upon request with annual reports, including financial statements;
3. to participate, vote and be eligible for any elective or appointive office of the association subject to the qualifications as provided for in the bylaws;
4. to demand and promptly receive deposits required by the association as soon as the condition for the deposit has been complied with or the period has expired;
5. to participate in association meetings, elections and referenda, as long as his/her bona fide membership subsists; and
6. to enjoy all other rights as may be provided for in the association bylaws. [Section 7, Rep. Act No. 9904]

“Basic community services and facilities” refer to services and facilities that redound to the benefit of all homeowners and from which, by reason of practicality, no homeowner may be excluded such as, but not limited to: security; street and vicinity lights; maintenance, repairs and cleaning of streets; garbage collection and disposal; and other similar services and facilities. [Section 3 (d), Rep. Act No. 9904]

On the other hand, a homeowner-member shall have the following duties:

1. to pay membership fees, dues and special assessments;
2. to attend meetings of the association; and
3. to support and participate in projects and activities of the association. [Section 8, Rep. Act No. 9904]

It is clear that paying the monthly association dues is a duty of a homeowner-member. But, before paying monthly dues, the homeowner-member must verify if the HOA is duly registered at the Department of Human Settlements and Urban Development (DHSUD) – formerly at the Housing and Land Use Regulatory Board (HLURB).

If the HOA is duly registered, the homeowner-member must demand an official receipt that is registered at the Bureau of Internal Revenue (BIR) when paying the monthly dues and special assessments. This is to make sure that the dues being paid are legally accounted for.

Now based on Rep. Act No. 9904 and its Implementing Rules and Regulations (IRR), please know that “the dues, fees, and special assessments to be imposed on a regular basis, and the manner in which the same may be imposed and/or increased” should be clearly provided or written in the Association Bylaws.

Finally, please know that the monthly dues are intended for garbage collection, salary of security guards, cleaning and maintenance of streets, establishment of parks, etc. It is likened to a tax that Filipinos pay to support the programs of the National and Local Governments.

Now, the question on the table is this: Can a homeowner-member withhold paying monthly dues when the HOA officials fail to perform their responsibilities in protecting the community, maintaining the facilities, and assuring the cleanliness of vacant lots?

Based on the Magna Carta and its IRR, homeowner-members have no right to withhold or stop paying their monthly dues for any reason at all. If the homeowner-member has a complaint against the HOA Official then that should be addressed in a proper forum – like the Grievance Committee of the HOA or an administrative complaint filed at the DHSUD Regional Office.

There is no provision in Rep. Act No. 9904 and IRR that legally permits or allows a homeowner-member to stop and withhold payment of monthly dues in response to the failings of the HOA Officers and their agents or representatives.

Note that Section 23 of Pres. Decree No. 957 allows a buyer to stop or desist from paying installments for the reason that the developer to develop the condominium or subdivision project. This provision is quoted hereunder:

“SECTION 23. Non-Forfeiture of Payments. – No installment payment made by a buyer in a subdivision or condominium project for the lot or unit he contracted to buy shall be forfeited in favor of the owner or developer when the buyer, after due notice to the owner or developer, desists from further payment due to the failure of the owner or developer to develop the subdivision or condominium project according to the approved plans and within the time limit for complying with the same. Such buyer may, at his option, be reimbursed the total amount paid including amortization interests but excluding delinquency interests, with interest thereon at the legal rate.”

Now, this permission to withhold or desist installment payment “due to the failure of the owner or developer, desists from further payment due to the failure of the owner or developer to develop the subdivision or condominium project according to the approved plans and within the time limit for complying with the same” should strictly follow the requirements of due process.

However, this permission is not present in the provisions of the Rep. Act No. 9904 and its IRR. Therefore, the conclusion here is the answer that is stated above. It is what it is. The homeowner-member has the duty to pay the monthly due every time it is time to pay it.

Again, if the homeowner-member has a grievance with the HOA Officer not paying the monthly dues is the answer to the problem or grievance. Dura lex sed lex. The law is harsh but it is the law.

Let us just hope that the HOA has a Grievance Committee already set up. If there is none then the Lupon ng Tagapamayapa of your barangay is the next best forum to bring your complaint.

Best of luck to all the homeowner-member who are having difficulties with their HOA Officers/Officials or their representatives. I hope this helps with your situation.

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Atty. Jojo is a real estate attorney, an estate planning attorney, a licensed real estate broker, and a PRC-accredited Lecturer/ Speaker for Training Programs in Real Estate. He is a Chartered Trust and Estate Planning (CTEP®) professional who is committed to educating Filipinos about the value and importance of having an estate plan in their lives.