G.R. No. 148116, 14 April 2004
FACTS:
Mrs. Lourdes Alimario and Agapito Fisico who worked as brokers, offered to sell to the petitioners the parcels of land. The brokers told the petitioners that they were authorized by respondent Fernandez to offer the property for sale. The petitioners and respondent Fernandez agreed that the petitioners would buy the property and that the owners were to shoulder the capital gains tax, transfer tax and the expenses for the documentation of the sale.
The petitioners and respondent Fernandez also agreed to meet to finalize the sale. It was also agreed upon that on the said date, respondent would present a SPA executed by the owners of the property, authorizing her to sell the property for and in their behalf and to execute a deed of absolute sale thereon. The petitioners would also remit the purchase price to the owners, through respondent Fernandez. However, only Agapito Fisico attended the meeting. He informed the petitioners that respondent Fernandez was encountering some problems with the tenants and was trying to work out a settlement with them. After a few weeks of waiting, the petitioners wrote respondent Fernandez demanding that their transaction be finalized.
When the petitioners received no response from respondent, the petitioners sent her another letter, asking that the Deed of Absolute Sale covering the property be executed in accordance with their verbal agreement. The petitioners also demanded the turnover of the subject properties to them within fifteen days from receipt of the said letter; otherwise, they would have no option but to protect their interest through legal means.
Petitioner rejected the claims of the petitioner. The petitioners filed the instant Complaint for specific performance with damages against respondent Fernandez and the registered owners of the property. After trial on the merits, the trial court rendered judgment in favor of the petitioners. The appellate court promulgated its decision reversing and settling aside the judgment of the trial court and dismissing the petitioners’ complaint, as well as the respondents’ counterclaim.
ISSUE:
Whether the lower court erred in not holding that a special power of attorney was required in order that defendant-appellant Fernandez could negotiate the sale on behalf of the other registered co-owners of the two lots.
RULING:
There is no documentary evidence on record that the respondents-owners specifically authorized respondent Fernandez to sell their properties to another, including the petitioners. Article 1878 of the New Civil Code provides that a special power of attorney is necessary to enter into any contract by which the ownership of an immovable is transmitted or acquired either gratuitously or for a valuable consideration, or to create or convey real rights over immovable property, or for any other act of strict dominion. Any sale of real property by one purporting to be the agent of the registered owner without any authority therefor in writing from the said owner is null and void. The declarations of the agent alone are generally insufficient to establish the fact or extent of her authority. In this case, the only evidence adduced by the petitioners to prove that respondent Fernandez was authorized by the respondents-owners is the testimony of petitioner Antonio Litonjua that respondent Fernandez openly represented herself to be the representative of the respondents-owners, and that she promised to present to the petitioners on December 8, 1996 a written authority to sell the properties. However, the petitioners’ claim was belied by respondent Fernandez when she testified.
The petitioners cannot feign ignorance of respondent Fernandez’ lack of authority to sell the properties for the respondents-owners. It must be stressed that the petitioners are noted businessmen who ought to be very familiar with the intricacies of business transactions, such as the sale of real property.
The settled rule is that persons dealing with an assumed agent are bound at their peril, and if they would hold the principal liable, to ascertain not only the fact of agency but also the nature and extent of authority, and in case either is controverted, the burden of proof is upon them to prove it. In this case, respondent Fernandez specifically denied that she was authorized by the respondents-owners to sell the properties, both in her answer to the complaint and when she testified. The Letter dated January 16, 1996 relied upon by the petitioners was signed by respondent Fernandez alone, without any authority from the respondents-owners. There is no evidence on record that the respondents-owners ratified all the actuations of respondent Fernandez in connection with her dealings with the petitioners. As such, said letter is not binding on the respondents as owners of the subject properties.
*Case digest by Jhazeel Zhan Jebone, JD-IV, for Partnership and Agency, SY 2019-2020