Bautista vs. Nicorp Management and Development Corporation, GRN 214057, Oct.

19, 20115

Facts:

Petitioner Florentina Bautista-Spille is the registered owner of a parcel of land covered by TCT No. T-197.
She executed a general power of attorney in favor of her brother Benjamin Bautista, authorizing the latter to
administer all her businesses and properties in the Philippines.

On August 2004, Benjamin and Nicorp Management and Development Corporation entered into a contract
to sell pertaining to the parcel of land covered by TCT No. T-197 for P15, 000, 000.00, agreeing that NICORP shall
give a down payment of 20% of the purchase price and pay the remaining balance in 8 months and that upon
payment of down payment, the TCT of the subject property shall be deposited with the International Exchange Bank
and be put in escrow until payment of full amount. Benjamin Bautista was required to submit a special power of
attorney covering the sale, otherwise the balance would be suspended and a penalty of P150,000.00 shall be
imposed.

Upon discovery of the sale, petitioner’s lawyer immediately sent letters of demand to Benjamin Bautista,
NICORP, and IE informing them of petitioner’s opposition to the sale, that Benjamin was not clothed with the
authority to sell, and demanding the return of the TCT to her attorney-in-fact, Atty. Flores. Benjamin, NICORP, and
IE Bank, however, failed and refused to return the title of the subject property, resulting to the complaint filed by
petitioner before the RTC against Benjamin, NICORP and IE Bank for declaration of nullity of the contract,
pjunction, recovery of possession and damages with the prayer for the issuance of a temporary restraining order
and/or preliminary injunction because NICORP was starting the development of the subject property into a
residential subdivision and was planning to sell the lost to prospective buyer.

On May 2010, the RTC rendered its judgment declaring the contract to sell null and void, explaining that
the general power of authority only pertained to act of administration over petitioner’s business and properties in the
Philippines and did not include authority to sell the subject property. It was pointed out that NICORP, by demanding
from Benjamin the special power of attorney and imposing a penalty in case of failure of submission, had
knowledge of petitioner’s lack of authority.

Upon appeal before the CA, the CA reverse the decision of the RTC, explaining that the general power of
attorney authorized Benjamin to perform acts of administration as well as acts of dominion over the subject
property. The motion for reconsideration filed by the petitioner was subsequently denied, hence this petition for
review of certiorari, contending that the honorable CA erred in ruling that the general power of attorney executed by
petitioner clothed Benjamin with the authority to enter into a contract to sell the subject property because it only
pertained to the power to buy, sell, negotiate and contract over the business and personal property.

NICORP counters that the general power of attorney sufficiently conferred authority on Benjamin to enter
into the contract to sell. It asserts that the written authority, while denominated as a general power of attorney,
expressly authorized him to sell the subject property.

Issue:

WHETHER OR NOT BENJAMIN BAUTISTA WAS AUTHORIZED TO SELL THE SUBJECT PROPERTY.

Ruling:

Petition is meritorious.
 The Civil Code provides that “When a sale of a piece of land or any interest therein is through an agent, the
authority of the latter shall be in writing; otherwise, the sale shall be void” and 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.” Jurisprudence further explains that the express mandate required by
law to enable an appointee of any (couched) in general terms to sell must be one that expressly mentions a sale or
that includes a sale as a necessary ingredient of the act mentioned. For the principal to confer the right upon an agent
to sell real estate, a power of attorney must so express the powers of the agent in clear and unmistakable language.
When there is any reasonable doubt that the language so used conveys such power, no such construction shall be
given the document.

It is a general rule that a power of attorney must be strictly construed, and courts will not infer or presume
broad powers from deeds which do not sufficiently include property or subject in which the agent is to deal. Thus,
when the authority is couched in general terms, without mentioning any specific power to sell of mortgage or to do
other specific acts of strict dominion, then only acts of administration are deemed conferred.

In the case at bar, there was no perfected contract to sell between petitioner and NICORP. Nowhere in the
General Power of Attorney was Benjamin granted, expressly or implied, any power to sell the subject property or a
portion thereof, the authority expressed in the General Power of Attorney was couched in very broad terms covering
petitioner’s businesses and properties. The power of administration does not include acts of disposition, which are
acts of strict ownership. As such, an authority to dispose cannot proceed from an authority to administer, and vice
versa, for the two powers may only be exercised by an agent by following the provisions on agency of the Civil
Code.