AF REALTY AND DEVELOPMENT INC v DIESELMAN FREIGHT SERVICES, CO. G.R. No.

111448; January 16, 2002; Sandoval-Gutierrez, J. Dige t !re!ared "y Ja#$ie %anla FACTS: Die el&an 'reig(t Servi#e %o. i an o)ner o* a 2,0+4 ,&. lot lo#ated in -a ig %ity. .anuel %. %ruz, Jr., a &e&"er o* t(e "oard o* dire#tor o* Die el&an, i ued a letter aut(orizing %ri teta -olintan /real e tate "ro$er o* %N- Real 0 tate 1ro$erage2 3to loo$ *or a "uyer and negotiate t(e ale3 o* t(e lot at -456 ,&. %ruz, Jr. (a no )ritten aut(ority *ro& Die el&an to ell t(e lot. 7n turn, -olintan aut(orized 'eli#i i&a 8.i&i9 No"le to ell t(e a&e lot. No"le o**ered t(e !ro!erty to :' Realty ; Develo!&ent, 7n#. at -2.<56 ,&. =enaida Ranullo, :' Realty >- and "oard &e&"er, a##e!ted t(e o**er and i ued a #(e#$ *or -4005. Ranullo a $ed -olintan *or t(e "oard re olution o* Die el&an aut(orizing t(e ale. ?o)ever, -olintan #ould only give Ranullo t(e original #o!y o* @%@, t(e taA de#laration and taA re#ei!t *or t(e lot, and a !(oto#o!y o* t(e :rti#le o* 7n#or!oration o* Die el&an. %ruz, Sr., Die el&an -re ., a#$no)ledged re#ei!t o* aid -4005 a 3earne t &oney3 "ut re,uired :' Realty to *inalize t(e ale at -456 ,&. :' Realty re!lied t(at it i )illing to !ay t(e "alan#e. ?o)ever, %ruz, Sr. ter&inated t(e o**er and de&anded *ro& :' Realty t(e return o* t(e title o* t(e lot. %lai&ing t(at t(ere )a a !er*e#ted #ontra#t o* ale, :' Realty *iled a #o&!laint *or !e#i*i# !er*or&an#e again t Die el&an and %ruz, Jr. @(e #o&!laint !rayed t(at Die el&an "e ordered to eAe#ute and deliver a *inal deed o* ale in *avor o* :' Realty. 7n it an )er, Die el&an alleged t(at it did not aut(orize any !er on to enter into u#( tran a#tion on it "e(al*. .ean)(ile, Die el&an and .ida Develo!&ent %or!oration /.ida 2 eAe#uted a Deed o* :" olute Sale o* t(e a&e !ro!erty. @(e trial #ourt (eld t(atB o @(e a#t o* %ruz, Jr. "ound Die el&an in t(e ale o* t(e lot to :' Realty. %on e,uently, t(e !er*e#ted #ontra#t o* ale "et)een Die el&an and :' Realty "ar .ida C intervention. o .ida a#ted in "ad *ait( )(en it initially !aid Die el&an -<005 even )it(out eeing t(e latterC title to t(e !ro!erty. .oreover, t(e notarial re!ort o* t(e ale )a not u"&itted to t(e %ler$ o* %ourt o* t(e Duezon %ity R@% and t(e "alan#e o* -<.4. !ur!ortedly de!o ited in e #ro) "y .ida )it( a "an$ )a not e ta"li (ed. %: rever ed. 7t (eld t(at %ruz, Jr. )a not aut(orized in )riting "y Die el&an to ell t(e !ro!erty to :' Realty, t(u t(e ale )a not !er*e#ted. :l o, t(e Deed o* :" olute Sale "et)een Die el&an and .ida i valid, t(ere "eing no "ad *ait( on t(e !art o* t(e latter. ISSUE/RULING: WON AF Realty DECISION AFFIRMED. a! a "#$ t %ve" t e !&'(e)t l%t * NO. CA

RATIO: 7nvolved in t(i #a e i a ale o* land t(roug( an agent. @(u , t(e la) on agen#y under t(e %ivil %ode ta$e !re#eden#e. Sin#e a #or!oration, u#( a t(e Die el&an, #an a#t only t(roug( it o**i#er and agent , all a#t )it(in t(e !o)er o* aid #or!oration &ay "e !er*or&ed "y agent o* it ele#tion; and, eA#e!t o *ar a li&itation or re tri#tion &ay "e i&!o ed "y !e#ial #(arter, "y-la), or tatutory !rovi ion , t(e a&e general !rin#i!le o* la) )(i#( govern t(e relation o* agen#y *or a natural !er on govern t(e o**i#er or agent o* a #or!oration, o* )(atever tatu or ran$, in re !e#t to (i !o)er to a#t *or t(e #or!oration; and agent )(en on#e a!!ointed, or &e&"er a#ting in t(eir tead, are u"Ee#t to t(e a&e rule , lia"ilitie , and in#a!a#itie a are agent o* individual and !rivate !er on . -ertinently, N%%18F4 !rovide t(at "When a sale of 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." %on idering t(at %ruz, Jr., %ri teta -olintan and 'eli#i i&a Ranullo )ere not aut(orized "y Die el&an to ell it lot, t(e u!!o ed #ontra#t )it( :' Realty i void. 1eing a void #ontra#t, it i not u #e!ti"le o* rati*i#ation "y #lear &andate o* NN 140+, t(u B "The following contracts are inexistent and void from the very beginning: ( ! Those expressly prohibited or declared void by law. xxx These contracts cannot be ratified. "either can the right to set up the defense of illegality be waived.# Gn t(e ot(er (and, t(e validity o* t(e ale to .ida i un,ue tiona"le. : noted, t(e ale )a aut(orized "y a "oard re olution o* re !ondent Die el&an.