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,
Republic of the Philippines
Department of Finance
Securities and Exchange Commission
SEC Building, EDSA, Greenhills, Mandaluyong City
Office of the General Counsel
18 September 2012
SEC-OGCOpinion No. 12-18
Re: Quorum and Voting Rights in a
Condominium Corporation
VELASCO LAW OFFICE
116 Malakas St. Diliman,
1100 Quezon City
Attention: Atty. Brenda Angeline K. Velasco-Ho
Dear Atty. Velasco-Ho:
This refers to your query on the proper computation of the quorum and "vote
entitlement" of each member of the condominium corporation, East Side Condominium
Association, Inc. (ECAI). Specifically, you are seeking clarification regarding the
perceived conflict between the By-Laws of ECAI and the Second Amended Master Deed
and Declaration of Restriction (Master Deed) dated 15 January 2007 executed by BSC
Realty Incorporated, which developed East Side Condominium in accordance with
Republic Act No. 4726 (the Condominium Act).
ECAI is a non-stock non- profit association, with SEC Registration No. CN
200818473, with Certificate of Incorporation dated 26 November 2008. It is composed
of unit owners of East Side Condominium located at No. 77 Malakas St. Bgy. Pinyahan,
Quezon City. The purpose for which ECAI is incorporated is:
"xxx own, hold title to the common areas in the condominium project known and
identified as East Side Condominium which has been constituted pursuant to the
provisions of Republic Act No. 4726 on the property described in and brought
under the operation of said Act by the Master Deed with Declaration of
Restrictions executed by SSCRealty, Inc. on 07 October 2005 xxx"
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Section 6, Article I, of the By-Lawsof ECAI provides:
"Voting Proxy - Each member shall be entitled to one vote, and he may
vote either in person or by proxy which shall be in writing and filed with the
Secretary of the association before the scheduled meeting."
On the other hand, Section 8 c), 1 Part I, of the Master Deed provides:
"Each condominium unit owner, as an appurtenance of such ownership, shall
automatically become a member of the condominium corporation provided for
above. The proprietary interest acquired by each member of the
condominium corporation shall be equal to the appurtenant interest of
his unit in the common areas as provided in Section 7 above. Each
condominium unit owner shall also acquire, as an appurtenance of the unit, an
easement for the limited common areas as may be provided herein." (Emphasis
supplied)
Section 72 referred to above provides:
"To each unit in the Condominium Project shall indirectly appertain an undivided
interest in the common areas equal to the percentage which the floor area of the
unit and the corresponding parking space purchased in conjunction therewith, if
any, bears to the floor area of all the units and parking spaces in the
condominium project exclusive of common areas. Thus:
Area of Unit and Area of Parking Space
Total area of all units and parking spaces = Percentageof interest of unit
in the Condominium Project exclusive of in the Common Areas"
Common Areas
You believe that Section 6, Article I, of the By-Laws of ECAI is inconsistent with
Section 8 c), Part I, of the Master Deed.
In view of the foregoing provisions, you have asked for an opinion thus: "Due to
the apparent conflict between the By-Laws and the Master Deed xxx should a unit
member of a condominium corporation be entitled to one (1) vote as stated in the By-
laws (regardless of its percentage interest) or to the extent of its interest in the
Condominium project using the formula for the Master Deed?"
Section 10 of the Condominium Act as amended, provides:
1 Nature and Extent of Interest Acquired by Purchasers of Phase I and Phase II Units.
2 Appurtenant Interest of Each Unit in the Common Areas.
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Page 3 of 3
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in a Condominium Corporation
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"The articles of incorporation or by-laws of the corporation shall not
contain any provision contrary to or inconsistent with the provisions of
this Act, the enabling or master deed, or the declaration of restrictions
of the project." (Emphasisours)
Therefore, for purposes of determining the voting rights of each member, it is
the Master Deed that should be followed.
It shall be understood, however, that the foregoing opinion is rendered based
solely on the facts and circumstances disclosed and relevant solely to the particular
issues raised therein and shall not be used in the nature of a standing rule binding upon
the Commission in other cases or upon the courts whether of similar or dissimilar
circumstances.3 If, upon further inquiry and investigation, it will be disclosed that the
facts relied upon are different, this opinion shall be rendered void.
Pleasebe guided accordingly.
Very truly yours,
~A
General Counsel~
3 Paragraph 7, SEC Memorandum Circular No. 15, Series of 2003.
