13/06/2026
โ๏ธโ๏ธ NO LICENSE TO SELL but the Developer invokes MACEDA LAW : Can a Developer Hide Behind the Maceda Law if They Sold You an Illegal Property?โ๏ธโ๏ธ
Youโve been paying monthly for years for your dream subdivision lot. Then you discover the developer has NO DHSUD License to Sell. When you demand your hard-earned money back, they say:
โWeโll only give you 50% Maceda Law says so.โ
Anna paid for 3 years for a subdivision lot. Later, she found out the developer never had a DHSUD License to Sell. When she asked for a refund, the developer offered only 50% citing Maceda Law. But Anna knew her rights the sale was illegal, so she demanded a full refund. The law was on her side.
Sounds unfair? Thatโs because it is. And hereโs why.
The developer cannot use the Maceda Law to limit your refund because Maceda Law does not apply to illegal or unlicensed projects.
The Maceda Law (RA 6552) is designed to protect installment buyers of legally sold properties. It provides that after at least two years of installment payments, the buyer is entitled to a 50% refund of total payments made if the contract is canceled.
However, this protection applies only if the sale itself is valid meaning the developer must have secured a License to Sell from DHSUD.
If the project has no License to Sell, the sale is not legally valid, and the developer cannot cherry pick Maceda Law provisions to reduce liability.
Instead, the developerโs act of selling without a license is a clear violation of PD 957, making the entire transaction illegal and voidable.
Under this situation, you are entitled to a full refund and may also claim damages.
Learn on the Truth About Maceda Law
The Maceda Law (RA 6552) was created to protect buyers of legally sold real estate through installment.
Yes, it gives buyers the right to a 50% refund (increasing over time) if they cancel BUT this only applies if the sale is valid and the developer followed all the rules.
โ๏ธIf thereโs no License to Sell from DHSUD, the project is illegal. Therefore, the developer cannot use the Maceda Law to limit your rights.
What the Law Really Says
Under PD 957 (Subdivision and Condominium Buyersโ Protective Decree), selling without a license is a serious violation.
The contract is VOIDABLE, meaning you can cancel it and demand a full refund. (It does not mean it is void but it is VOIDABLE meaning valid until cancelled.)
The developer can also face sanctions for selling illegally.
Maceda Law applies only to valid, legal sales.
Contracts involving projects sold without a License to Sell can be annulled, with buyers entitled to full restitution.
A developer who violates the law cannot use the Maceda Law to escape full liability.
If they sold you an unlicensed property, you can demand 100% of your money back.
The law is clear: No license, no protection for the developer.
Caveat: This scenario presupposes that the developer not only lacked a License to Sell (LTS) but also failed to deliver the project or committed other material breaches of its obligations under the Contract to Sell and PD 957.
If the only defect is the absence of a License to Sell, Supreme Court jurisprudence (e.g., Moldex Realty, Inc. v. Saberon) holds that such absence does not automatically void the contract between the parties. The contract remains valid, and the violation is addressed administratively against the developer.
However, when the lack of LTS is coupled with non delivery, revocation of license, or fraudulent pre-selling, buyers have strong grounds to rescind the contract and claim a full refund with interest under PD 957
