Rallos vs.

Felix Go Chan & Sons Realty Corporation

G.R. No. L-24332. January 31, 1978
Facts:
Concepcion and Gerundia Rallos were sisters and registered co-owners of a parcel of
land in Cebu. They executed a special power of attorney in favor of their brother, Simeon Rallos,
authorizing him to sell such land for and in their behalf. After Concepcion died, Simeon Rallos
sold the undivided shares of his sisters Concepcion and Gerundia to Felix Go Chan & Sons
Realty Corporation. Ramon Rallos, administrator of the Intestate Estate of Concepcion filed a
complaint praying that the sale of the undivided shares of land be declared unenforceable.
Issue:
Whether or not the sale of the undivided share of Concepcion Rallos is valid although it
was executed by the agent after the death of his principal.
Ruling:
No. Under Art. 1919 of the Civil Code, the death of the principal revokes ipso jure the
agency. Article 1931 of the Civil Code provides for an exception to the general rule. Under Art.
1931, NCC, an act done by the agent after the death of his principal is valid and effective only
under two conditions, viz: (1) that the agent acted without knowledge of the death of the
principal, and (2) that the third person who contracted with the agent himself acted in good faith.
Good faith here means that the third person was not aware of the death of the principal at the
time he contracted with said agent. These two requisites must concur: the absence of one will
render the act of the agent invalid and unenforceable.
In the instant case, the agent Simeon Rallos knew of the death of his principal at the time
he so the latter’s share in the Lot to the corporation. On the basis of the established knowledge of
Simeon Rallos concerning the death of his principal, Article 1931 of the Civil Code is
inapplicable. Therefore, the sale should be considered unenforceable.
 Linan vs. Puno
G.R. No. 9608. August 7, 1915
Facts:
Diego Linan was the owner of a parcel of land in Tarlac. On May 1908, Linan executed a
document which conferred upon Marcos Puno sufficient power to “administer the interest
[Linan] possess within the municipality of Tarlac, purchase, sell, collect and pay… in any
proceeding or business concerning the good administration and advancement of his said
interest…” In June 1911, Puno sold and delivered said parcel of land to the Maglanoks. Linan
alleged that the document did not confer upon Puno the power to sell the alnd and prayed that the
sale be ses aside.
Issue:
Whether or not the sale of the land was illegal and void
Ruling:
No. Contracts of agency, as well as general powers of attorney, must be interpreted in
accordance with the language used by the parties. The real intention of the parties is primarily to
be determined from the language used. The intention is to be gathered from the whole
instrument. In case of doubt, resort must be had to the situation, surroundings, and relations of
the parties. It is to be presumed that the parties said what they intended to say and that they used
each word or clause with some purpose, and that purpose is, if possible, to be ascertained and
enforced. The meaning of general words must be construed with reference to the specific object
to be accomplished and limited by the recitals made in reference to such object.
Observing the document executed by Linan, there seems to be no good reason for saying
that Puno had authority to administer and not to sell when “to sell” was as advantageous to Linan
in the administration of his affairs as “to administer”. To hold that the power was “to administer”
only when the power “to sell” was equally conferred would be to give effect to a portion of the
contract only. That would give to special words of the contract a special and limited meaning to
the exclusion of other general words of equal import. Thus, Puno was well within the power
conferred upon him as agent of Linan when he sold the latter’s parcel of land; the sale is valid.