Professional Documents
Culture Documents
19 22
19 22
Held: Yes. In any event, the bank acknowledged, by its own acts or failure to act, the authority
of Fe S. Tena (bank manager) to enter into binding contracts. After the execution of the Deed of
Sale, respondents occupied the properties in dispute and paid the real estate taxes due thereon. If
the bank management believed that it had title to the property, it should have taken some
measures to prevent the infringement or invasion of its title thereto and possession thereof.
Likewise, Tena had previously transacted business on behalf of the bank, and the latter had
acknowledged her authority. A bank is liable to innocent third persons where representation is
made in the course of its normal business by an agent like Manager Tena, even though such
agent is abusing her authority.
The bank is estopped from questioning the authority of the bank manager to enter into the
contract of sale. If a corporation knowingly permits one of its officers or any other agent to act
within the scope of an apparent authority, it holds the agent out to the public as possessing the
power to do those acts; thus, the corporation will, as against anyone who has in good faith dealt
with it through such agent, be estopped from denying the agent's authority.
21. Doles vs. Angeles
Facts: Ma. Aura Tina Angeles (respondent) alleged that Jocelyn Doles (petitioner) was
indebted to the former amounting to P405,430.00 and that by virtue of a "Deed of Absolute
Sale", petitioner, as seller, ceded to respondent, as buyer, a parcel of land in order to satisfy her
personal loan with respondent. The property was mortgaged to National Home Mortgage
Finance Corporation (NHMFC) therefore as a condition for the foregoing sale, respondent shall
assume the undue balance of the mortgage and pay the monthly amortization. Upon verification,
respondent learned that petitioner had incurred arrearages which she refused to pay despite
repeated demands and that she refused to cooperate with respondent to execute the necessary
documents required by the NHMFC to effect the transfer of the title.
Petitioner denied that she borrowed money from respondent and averred that she referred
her friends to respondent whom she knew to be engaged in the business of lending money in
exchange for personal checks through her capitalist Arsenio Pua. She further alleged that
respondent then threatened to initiate a criminal case against her for violation of Batas
Pambansa Blg. 22 for the bounced checks she issued when she could no longer locate the
referred borrowers, therefore the said deed had no valid consideration.
It is an admitted fact by both petitioner and defendant based on their testimonies, that
respondent knew that the money will be used by the friends of the petitioner, that the respondent
was merely representing Arsenio Pua, and that before the supposed friends of the petitioner
defaulted in payment, each issued their personal checks in the name of Arsenio Pua for the
payment of their debt.
Issue: Whether or not the petitioner and respondent were acting as agents.
Held: Yes. Under Article 1868 of the Civil Code, the basis of agency is representation. The
question of whether an agency has been created is ordinarily a question which may be
established in the same way as any other fact, either by direct or circumstantial evidence. The
question is ultimately one of intention. Agency may even be implied from the words and conduct
of the parties and the circumstances of the particular case. Though the fact or extent of authority
of the agents may not, as a general rule, be established from the declarations of the agents alone,
if one professes to act as agent for another, she may be estopped to deny her agency both as
against the asserted principal and the third persons interested in the transaction in which he or
she is engaged.
In this case, petitioner knew that the financier of respondent is Pua; and respondent knew that the
borrowers are friends of petitioner.
22. Pahud vs CA
Facts: On 1992, Eufemia, Ferdinand and Raul executed a Deed of Absolute Sale of
Undivided Shares conveying in favor of petitioners (the Pahuds, for brevity) their respective
shares from the lot they inherited from their deceased parents for ₱525,000.00. Eufemia signed
the deed on behalf of her four (4) other co-heirs, namely: Isabelita on the basis of a special power
of attorney, and for Milagros, Minerva, and Zenaida but without their apparent written
authority. The deed of sale was also not notarized. After the payment of the Pahuds to the Los
Baños Rural Bank where the subject property was mortgaged, the bank issued a release of
mortgage and turned over the owner’s copy of the OCT to the Pahuds. When Eufemia and her
co-heirs drafted an extra-judicial settlement of estate to facilitate the transfer of the title to the
Pahuds, Virgilio refused to sign it.
In the course of the proceedings for judicial partition filed by Virgilio’s co-heirs, a Compromise
Agreement was signed with seven (7) of the co-heirs agreeing to sell their undivided shares to
Virgilio for ₱700,000.00. The compromise agreement was, however, not approved by the court
because Atty. Dimetrio Hilbero, lawyer for Eufemia and her co-heirs, refused to sign the
agreement because he knew of the previous sale made to the Pahuds.
Virgilio then sold the entire property to Spouses Belarminos. The Belarminos immediately
constructed a building on the subject property. The Pahuds immediately confronted Eufemia who
confirmed to them that Virgilio had sold the property to the Belarminos. Aggrieved, the Pahuds
filed a complaint in intervention in the pending case for judicial partition.
HELD: Yes, the sale is valid. Under Art. 1874 of 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. Also, under Art. 1878, a special power of attorney is
necessary for an agent to enter into a contract by which the ownership of an immovable property
is transmitted or acquired.
The sale made by Eufemia, Isabelita and her two brothers to the Pahuds should be valid only
with respect to the 4/8 portion of the subject property. The sale with respect to the 3/8 portion,
representing the shares of Zenaida, Milagros, and Minerva, is void because Eufemia could not
dispose of the interest of her co-heirs in the said lot absent any written authority from the latter,
as explicitly required by law.
While the sale with respect to the 3/8 portion is void by express provision of law and not
susceptible to ratification, the court nevertheless uphold its validity on the basis of the common
law principle of estoppel.