DIEGO LINAN vs. MARCOS PUNO (G.R. No.

L-9608) Facts: Linan an owner of a parcel of land executed a document stating the power, duties and obligations of Puno: I, Diego Lian, of age, married, a resident of Daet, Province of Ambos Camarines, Philippine Islands, and at the present time temporarily residing in this city of Tarlac, capital of the Province of Tarlac, P.I., set forth that I hereby confer sufficient power, such as the law requires, upon Mr. Marcos P. Puno, likewise a resident of this city of Tarlac, capital of the Province of Tarlac, in order that in my name and representation he may administer the interest I possess within this municipality of Tarlac, purchase, sell, collect and pay, as well as sue and be sued before any authority, appear before the courts of justice and administrative officers in any proceeding or business concerning the good administration and advancement of my said interests, and may, in necessary cases, appoint attorneys at law or attorneys in fact to represent him. June 1911 Puno sold and delivered the said parcel of land to the other defendants for a sum of 800pesos Plaintiff alleges that the document did not confer upon Puno the power to sell the land and prayed that the sale be set aside, the land be returned to him together with damages. Puno contend s that the sale was valid and prayed that he be relieved from any liability. Issue: Whether the sale of Puno acting as an agent of Linan was a valid sale ? Ruling: RTC: Favored plaintiff Linan That the document (1) did not give Puno authority to sell the land; (2) that the sale was illegal and void; (3) That defendants should return to the land to the plaintiff; and (4) That the defendants should pay to the plaintiff the sum of P1,000 as damages, P400 of which the defendant Puno should alone be responsible for, and to pay the costs SC: Favored defendant puno : to quote; The SC examined the power conferred upon the defendant Puno (Exhibit A) and ascertain, if possible, what was the real intent of the plaintiff. The lower court held that the "only power conferred was the power to administer." Reading the contract we find it says that the plaintiff "I confer ... power ... that ... he may administer ... purchase, sell, collect and pay ... in any proceeding or business concerning the good administration and advancement of my said interests." The words "administer, purchase, sell," etc., seem to be used coordinately. Each has equal force with the other. 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 the plaintiff 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 to special words of the contract a special and limited meaning to the exclusion of other general words of equal import. The record contains no allegation on proof that Puno acted in bad faith or fraudulently in selling the land. It will be presumed that he acted in good faith and in accordance with his power as he understood it. That his interpretation of his power, as gathered from the contract the other defendants acted in good faith, we are of the opinion that the contract, liberally construed, as we think it should be, justifies the interpretation given it by Puno. In reaching this conclusion, we have taken into account the fact that the plaintiff delayed his action to annul said sale from the month of June, 1911, until the 15th of February, 1913. Neither have we overlooked the fact in the brief of the appellants that the plaintiff has not returned, nor offered to return, nor indicated a willingness to return, the purchase price In view of all the foregoing, we are of the opinion that the lower court committed the error complained of in the second assignment, and, without discussing the other assignments of error, we are of the opinion, and so hold, that the judgment of the lower court should be and is hereby revoked and that the appellants should be relieved from all liability under the complaint.
Facts: CABALLERO v. DEIPARINE There was a stipulation of facts stating the following: o Plaintiffs are the children by the first marriage, defendants (Ragas) are the children by the second marriage of Vicenta Bucao. o Vicenta Bucao and Tomas Raga acquired land in Cebu. of this land was sold to Antonio Caballero (one of the plaintiffs). Land was never transferred thru title. o Later on, Deiparine acquired the whole lot through purchase from Tomas Raga. TCT was issued to Deiparine. The stipulation was only signed by Atty. Guba(for plaintiffs) and Atty. Davide(for respondents). From the stipulation of facts, the CFI rendered decision in favor of the defendants (that Deiparine owns the whole lot).

Plaintiffs filed for reconsideration saying that they were never made to participate in the preparation and formation of the stipulation of facts

Issue: W/N the stipulation of facts is valid Held: The case is remanded to court of origin for further proceedings and the amended complaint should be accepted. It is puzzling why the petitioners signatures were not affixed in the stipulation. The conduct of Atty. Guba in entering into a compromise agreement without the knowledge and consent of his clients is not in keeping with the sworn duty of a lawyer to protect the interest of his clients. It amounts to fraud. The stipulation of facts which was made the basis of the decision was null and void as it contained serious unauthorized admissions against the interest of the plaintiffs who had no hand in its preparation. Attorneys cannot, without special authority, compromise their clients litigation.

PHIL. SUGAR ESTATES v. POIZAT Facts: Juan Poizat (JP), married, was given general power of attorney which authorized him to enter transactions in the name of his wife, Gabriel de Coster. November 1912, he obtained a loan from PSED (plaintiffs) in the sum of ten thousand sterling for his use on the month of January. To secure the loan, however, he mortgaged real property of his wife which consisted of a house and six adjacent warehouses in Binondo (old buildings were torn down and new building constructed is presumed to come from the conjugal funds). Failure to pay the loan, however, led to the foreclosure of the property and subsequent sale of such to PSED. It was assessed at P342,685.00 but sold for P100,000.00. On September, 1924, Gabriel (wife) contested the sale on the ground that the mortgage was executed illegally and that husband was not authorized to execute it. The trial court overruled her allegations which prompted the appeal. Issue/Held/Ratio: WON the mortgage contract is valid and binding. No. The mortgage is valid and binding if it was executed by an attorney in fact and in the persons name and stead. If not, it is null and void. With the husbands use of the funds for his own purposes, he was not signing it in behalf of his wife and there is no showing that such signature delegating the power of attorney was intended to bind the wife to the agreement. Evidence suggests that he executed the instrument as a personal act and deed. Property was paraphernal before and during the marriage, for it to be validly mortgaged it must be shown that such a mortgage was executed in her name, place or stead and as her act and deed. Any authority which he had to bind his wife should be confined and limited to his POA. Giving to it the broadest construction, he would not have any authority to mortgage her property unless mortgage was executed for her and as her act and deed. Sec 1093: Deed of agent must purport to b e made and sealed in the name of the principal. The Court in a vote of 5-4 voted to negate the lower courts ruling. Justice Villa-real dissented. When the case was decided upon rehearing, an additional provision was cited from the CC: (1717) When an agent acts in his own name, the principal shall have no right of action against the persons with whom the agent has contracted, or such persons against the principal. In such case, the agent is directly liable to the person with whom he has contracted as if the transaction were his own. Cases involving things belonging to the principal are excepted. In the instant case, the court said it must be construed with Art. 1713 which provides that: In order to compromise, alienate, mortgage, or to execute any other act of strict ownership, an express power is required. The mortgage in question was upon real property, and it was not a simple contract, and where an agency is created by an express power, it must be executed with the formalities of an express power. Again, although the wife was party to the body of the mortgage, Poizat himself had an interest in the real property, and was a party to the instrument, and his personal signature was necessary to the mortgage to bind his own personal interest, and the interest of conjugal partnership. The power of attorney from the wife gave her husband the express power defined in Article 1713, and that power should have been exercised, and the mortgage should have been executed in the name, place and stead of the wife. This was not done. Villa-real, Dissenting: Upon signing and conveying power of attorney, such an act was tantamount to giving husband authority to encumber property.