Problem with developer in CEbu

Craig 1967 wrote:

Hi everyone. I plan to live in Cebu from next year and bought a condo at the beginning of the year with a 5% downpayment, move in fees paid, and inhouse finance for the balance. This was the agreement to allow me to move in. I decorated the condo and furnished it and initially had plans to rent it out before I moved there. After initially being told by the sales woman that would be ok, later the developer changed their mind and informed me to stop my rental business. It was not a rental business as such as I had only had one friend of a friend stay there for a few weeks. So anyway I cancelled my rental ads on the various websites and informed the developer of this. I was there in June and asked if I could discuss the matter with a manager. Unfortunately there was no one available for the whole 8 days I was there. Convenient. When I returned to Australia I received a letter of demand via email demanding full payment of the contract within 4 days. I have not defaulted on any of the monthly repayments yet the developer saw fit to send me this demand. When I contacted them on email many times they failed to respond. No one will discuss. Then early this week they email be a notarised cancellation of contract effective 30 days from receipt of the letter. Again they will not respond. I have contacted many lawyers in Cebu via email or websites but those that have responded advise there would be a conflict of interest. Most do not respond. I don't see how the developer can just cancel my contract and take possession of my condo if I have not defaulted and have complied with their after contract condition of non rental of the condo. I am worried without legal represantation I will lose the condo. Can anyone suggest an attorney who will respond and help me with this situation?

Craig, firstly welcome to the forum and I do hope you get better answers than from the likes of me.
While none of us are privy to the fine print of your contract only yourself, or hear say from a sales lady trying to feed her family, I quote you.

"I don't see how the developer can just cancel my contract and take possession of my condo if I have not defaulted and have complied with their after contract condition of non rental of the condo."

Is that condition in the contract you signed? If so you broke the contract and by your own admission and I quote.

"It was not a rental business as such as I had only had one friend of a friend stay there for a few weeks. So anyway I cancelled my rental ads on the various websites and informed the developer of this."

I cancelled my rental ads? Craig I'm sure the management have many copies of your adds and if it breaks the contract? Sorry to be hard but more fool you for listening to a sales girl. They will resell and make more money and until they sell you are obliged to meet your commitment, you could potentially lose it but have to keep paying for it until such time it sells/you retain.......... Not a good scenario if for you if in fact the contract details a non rental clause. Probably why none of the mouth pieces there will go near it unless you find a shady one (plenty of them) happy to take your dollars.

Please read and reread your contract and let us know if there is such a clause or no. There are plenty of learned, astute members on this site that I hope will throw their hat into the ring to give you better answers, my knowledge only comes from buying, selling, leasing/renting for over 40 years in Australia and recently (buyer beware) in the Philippines, very dangerous for the unwary.

Good luck and sorry to rain on your shower but I do hope that some members here can offer a more positive view,,,,,,,,, really comes back to what jargon is in your contract.

Cheers, Steve.

No there was no clause in the contract prohibiting rental of the condo. Subsequent to the contract being signed, and me letting someone stay in my unit, they sent me a form called "easy move in program". This form mentioned no renting out the unit. They asked me to sign and I did an electronic signature to confirm I received the form. It was not an agreement as such. Meaning it did not say "I agree... " etc.

So it sounds like they will do everything possible to get condos back from foreigners?

Yep agree, welcome to business no matter the country.
Nothing in the sales contract about renting? Nothing in the association dues memorandum mentioning renting? Nothing in the complex/development plans/structure about renting?

Again I Quote: "This form mentioned no renting out the unit." You signed it.

From my perspective/experience a digital signature on any document  or assignment asked by a second party over the internet "email"  becomes legal and revocable. (hey it's your email address no different to your bank account or accessing mygov). Be vigilant.
We, myself and Ben do this all the time and if unsure ask for clarification and then some.

Honestly Craig I know little but as said do hope the adults chime in with some help for your predicament.

Cheers, Steve.

Hi Craig,  Run it past the attorney you used to buy the place... If you didn't use an attorney, I'd say just fold your tent and move on.. Welcome to the phillipines.

Munchie wrote:

Hi Craig,  Run it past the attorney you used to buy the place... If you didn't use an attorney, I'd say just fold your tent and move on.. Welcome to the phillipines.

Amen and not only PH but all countries. That's why God made contracts no different to the Devil.

If a no rent clause is not inclusive within the contract you signed for the purchase of your condo then you may have a leg to stand on but probably a costly fight.

Cheers, Steve.

Something isn't right here. What was the reason given in the demand letter for full payment, if you had approved financing? Just curious because some of these loans involve balloon payments.  I certainly wouldn't just fold it up. But you should not have waited 8 days without talking to a manager about the issue. That was a red flag for sure that they were ignoring you.

I'm in the US at the moment but my GF will ask my attorney about this tomorrow. Please PM me with your contact info and I will ask him to contact you or make a referral.  I might also suggest that there is an ombudsman in one of the major newspapers who might be very interested if it turns out there is a local developer deliberately screwing over foreign investors, especially an Aussie.

Who is the developer?

Check the financing papers.  Typically a demand for full payment means your current financing has been withdrawn/cancelled.  You mention in-house financing which could have an owner-occupied clause.  Your rental ads would activate the clause in the financing which would lead to the payment in full demand notice.

This firm is co-owned by Ms Largo USC dean of Law whose 4 students got the top 10 Bar 2018 and who also have world renowned champion of moot court championship. Their practice on mostly on victim side. Make a point that your FOREIGN NATIONAL LAW protects you. Their realtor documents are all illegal unless you have waive it (but also questionable  tell them about the documents you signed and call your embassy in Cebu)
Florido & Largo Law Office
Suite 802, 8th Floor
Ayala Life – FGU Center
Cebu Business Park, Cebu City
6000 Philippines
    Tel Nos. (+6332)238-7232 to 7233
    (+6332) 415-7619
    email: [email protected]
                  [email protected]

Tell them your custodian was unauthorized and place an ad to rent your place.

That's my point, it will cost you an arm and a leg to fight this.. What is your investment to date... 5k aussie dollar maybe,? ... Walk away my friend. Think hard about owning properly
the Philippines.. My son bought a condo from a plan at Camira resort up past subic... In 2009...in 2014 they still had not delivered his condo.. He was 50k aussie dollars into it... And BTW, why Cebu City...

I like Cebu City. Anyway the consensus here and on another expat type of forum is to walk away as the monetary cost would be too high and there is a potential cost to my health which could be brought on by "2 guys on a motorcycle ". I don't like the idea of someone stealing from me and getting away with it but maybe best to drop it. I am down about 15k Aussie dollars.

I don't think that's been the consensus, but it's your money and your choice. Lots of good suggestions here. Looks like 15K AUD is $10K US - I sure wouldn't walk away from that without a fight. Attorneys in the Philippines don't charge the same as ours do. I would think a Cebu attorney would be more than happy to review your documents and write a cease and desist letter to the developer for no more than 20-25K, or roughly $4-500. That pays his rent for the month. Perhaps they would back off, and even if it involved some "negotiations" and ended up costing you a couple grand you would be way ahead.  But again, it's your money and your decision.

prahyb13 wrote:

Tell them your custodian was unauthorized and place an ad to rent your place.

That would be telling porky pies.

Cheers, Steve.

Craig, you have many and varied opinions coming from this and other forums, not a consensus at all and none of the offered opinions are so far from a legally qualified person including myself.
Have you reviewed your contract and paperwork? That is very important to your case. Only you are privy to the fine print and should make a decision based on that, if unsure then as others have suggested seek decent legal advice as you have a few bob tied up in this and as "pnwcyclist" wisely stated that throwing another 5 or even 10% of your investment into the pot could put your problem to bed.

If there is a no rent clause in any of the contract/s then you will have a fight on your hands. Good luck and hope you resolve this quickly. OMO.

Cheers, Steve.

It's possible that the “easy move in program” form was deemed an addendum to the contract. It's hard to say w/o actually reading everything. I would get up with an attorney to review all of the docs and go from there. As others have said, it shouldn't cost too much to have the docs reviewed and form a plan for moving forward one way or the other.