Академический Документы
Профессиональный Документы
Культура Документы
- versus -
Promulgated:
July 14, 2008
x------------------------------------------------------------------------------------x
DECISION
NACHURA, J.:
b. The deposit shall be made within ninety (90) days from date hereof. Any
interest earned on the aforesaid investment shall be for the buyers
account. However, the 10% deposit is non-interest earning.[11]
Prior to the expiration of the 90-day period within which to make the escrow
deposit, in view of the pendency of the case between the spouses Vaca and
petitioner involving the subject property,[12] respondents requested that the balance
of the purchase price be made payable only upon service on them of a final
decision or resolution of this Court affirming petitioners right to possess the
subject property. Atty. Soluta referred respondents proposal to petitioners Asset
Recovery and Remedial Management Committee (ARRMC) but the latter deferred
action thereon.[13]
On July 14, 1993, a month after they made the request and after the payment
deadline had lapsed, respondents and Atty. Soluta, acting for the petitioner,
executed another Letter-Agreement allowing the former to pay the balance of the
purchase price upon receipt of a final order from this Court (in the Vaca case)
and/or the delivery of the property to them free from occupants.[14]
Towards the end of 1993, or in early 1994, petitioner reorganized its
management. Atty. Braulio Dayday (Atty. Dayday) became petitioners Assistant
Vice-President and Head of the Documentation Section, while Atty. Soluta was
relieved of his responsibilities. Atty. Dayday reviewed petitioners records of its
outstanding accounts and discovered that respondents failed to deposit the balance
of the purchase price of the subject property. He, likewise, found that respondents
requested for an extension of time within which to pay. The matter was then
resubmitted to the ARRMC during its meeting on March 4, 1994, and it was
disapproved. ARRMC, thus, referred the matter to petitioners Legal Department
for rescission or cancellation of the contract due to respondents breach thereof.[15]
On May 5, 1994, Atty. Dayday informed respondents that their request for
extension was disapproved by ARRMC and, in view of their breach of the contract,
petitioner was rescinding the same and forfeiting their deposit. Petitioner added
that if respondents were still interested in buying the subject property, they had to
submit their new proposal.[16] Respondents went to the petitioners office, talked to
Atty. Dayday and gave him the Letter-Agreement of July 14, 1993 to show that
they were granted an extension. However, Atty. Dayday claimed that the letter was
a mistake and that Atty. Soluta was not authorized to give such extension.[17]
On June 6, 1994, respondents proposed to pay the balance of the purchase
price as follows: P3,000,000.00 upon the approval of their proposal and the
balance after six (6) months.[18] However, the proposal was disapproved by the
petitioners President. In a letter dated June 9, 1994, petitioner advised
respondents that the former would accept the latters proposal only if they would
pay interest at the rate of 24.5% per annum on the unpaid balance. Petitioner also
allowed respondents a refund of their deposit of P750,000.00 if they would not
agree to petitioners new proposal.[19]
For failure of the parties to reach an agreement, respondents, through their
counsel, informed petitioner that they would be enforcing their agreement
datedJuly 14, 1993.[20] Petitioner countered that it was not aware of the existence
of the July 14 agreement and that Atty. Soluta was not authorized to sign for and on
behalf of the bank. It, likewise, reiterated the rescission of their previous
agreement because of the breach committed by respondents.[21]
On July 14, 1994, in the Vaca case, this Court upheld petitioners right to
possess the subject property.
SO ORDERED.[26]
Applying the rule of apparent authority,[27] the court upheld the validity of
the July 14, 1993 Letter-Agreement where the respondents were given an extension
within which to make payment. Consequently, respondents did not incur in delay,
and thus, the court concluded that the rescission of the contract was without basis
and contrary to law.[28]
On appeal, the CA affirmed the RTC decision and upheld Atty. Solutas
authority to represent the petitioner. It further ruled that petitioner had no right to
unilaterally rescind the contract; otherwise, it would give the bank officers license
to continuously review and eventually rescind contracts entered into by previous
officers. As to whether respondents were estopped from enforcing the July 14,
1993 Letter-Agreement, the appellate court ruled in the negative. It found, instead,
that petitioners were estopped from questioning the efficacy of the July 14
agreement because of its failure to repudiate the same for a period of one year.
[29]
Thus, the court said in its decision:
1. The Appellant (Westmont Bank) is hereby ordered to execute a Deed
of Absolute Sale in favor of the Appellees over the property covered by Transfer
Certificate of Title No. 52593, including the improvement thereon, and secure,
from the Register of Deeds, a Torrens Title over the said property free from all
liens, claims or encumbrances upon the payment by the Appellees of the balance
of the purchase price of the property in the amount of P6,750,000.00;
2. The Register of Deeds is hereby ordered to cancel Transfer Certificate
of Title No. 158082 under the names of the Spouses Eduardo [and Ma. Pilar] Vaca
and to issue another under the names of the Appellees as stated in the preceding
paragraph;
3. The appellant is hereby ordered to pay to the appellee Rafael
Pronstroller the amount of P100,000.00 as and by way of moral damages and to
pay to the Appellees the amount of P30,000.00 as and by way of attorneys fees
and the amount of P20,000.00 for litigation expense.
4. The counterclaims of the Appellant are dismissed.
SO ORDERED.[30]
on May
I.
THE NARRATION OR STATEMENT OF THE FACTS OF THE CASE BY THE
HONORABLE COURT OF APPEALS IS TOTALLY BEREFT OF
EVIDENTIARY SUPPORT, CONTRARY TO THE EVIDENCE ON RECORD
AND
PURELY
BASED
ON
ERRONEOUS
ASSUMPTIONS,
PRESUMPTIONS, SURMISES, AND CONJECTURES.
II.
THE HONORABLE COURT OF APPEALS GROSSLY ERRED IN MERELY
RELYING UPON THE MANIFESTLY ERRONEOUS FINDING OF THE
HONORABLE TRIAL COURT ON THE ALLEGED APPARENT AUTHORITY
OF ATTY. JOSE SOLUTA, JR. IN THAT THE LATTERS FINDING IS
CONTRARY TO THE UNDISPUTED FACTS AND THE EVIDENCE ON
RECORD.
III.
THE HONORABLE COURT OF APPEALS OWN FINDING THAT ATTY.
JOSE SOLUTA, JR. HAD AUTHORITY TO SELL THE SUBJECT PROPERTY
ON HIS OWN (EVEN WITHOUT THE COMMITTEES APPROVAL) IS
LIKEWISE GROSSLY ERRONEOUS, FINDS NO EVIDENTIARY SUPPORT
AND IS EVEN CONTRARY TO THE EVIDENCE ON RECORD IN THAT
A.) AT NO TIME DID PETITIONER ADMIT THAT ATTY. JOSE SOLUTA, JR.
IS AUTHORIZED TO SELL THE SUBJECT PROPERTY ON HIS OWN;
B.) THE AUTHORITY OF ATTY. JOSE SOLUTA, JR. CANNOT BE
PRESUMED FROM HIS DESIGNATIONS OR TITLES; AND
C.) RESPONDENTS FULLY KNEW OR HAD KNOWLEDGE OF THE LACK
OF AUTHORITY OF ATTY. JOSE SOLUTA, JR. TO SELL THE SUBJECT
PROPERTY ON HIS OWN.
IV.
31,
Reduced to bare essentials, the decision on the instant petition hinges on the
resolution of the following specific questions: 1) Is the petitioner bound by theJuly
14, 1993 Letter-Agreement signed by Atty. Soluta under the doctrine of apparent
authority? 2) Was there a valid rescission of the March 18, 1993 and/orJuly 14,
1993 Letter-Agreement? 3) Are the respondents estopped from enforcing the July
14 Letter-Agreement because of their June 6, 1994 new proposal? 4) Is the
petitioner estopped from questioning the validity of the July 14 letter because of its
failure to repudiate the same and 5) Is the instant case a collateral attack on TCT
No. 158082 in the name of the spouses Vaca?
The petition is unmeritorious.
Well-settled is the rule that the findings of the RTC, as affirmed by the
appellate court, are binding on this Court. In a petition for review
on certiorariunder Rule 45 of the Rules of Court, as in this case, this Court may
not review the findings of fact all over again. It must be stressed that this Court is
not a trier of facts, and it is not its function to re-examine and weigh anew the
respective evidence of the parties.[32] The findings of the CA are conclusive on the
parties and carry even more weight when these coincide with the factual findings
of the trial court, unless the factual findings are not supported by the evidence on
record.[33] Petitioner failed to show why the above doctrine should not be applied
to the instant case.
Contrary to petitioners contention that the CAs factual findings are not
supported by the evidence on record, the assailed decision clearly shows that the
appellate court not only relied on the RTCs findings but made its own analysis of
the record of the case. The CA decision contains specific details drawn from the
contents of the pleadings filed by both parties, from the testimonies of the
witnesses and from the documentary evidence submitted. It was from all these that
the appellate court drew its own conclusion using applicable legal principles and
jurisprudential rules.
The Court notes that the March 18, 1993 Letter-Agreement was written on a
paper with petitioners letterhead. It was signed by Atty. Soluta with the
conformity of respondents. The authority of Atty. Soluta to act for and on behalf of
petitioner was not reflected in said letter or on a separate paper attached to it. Yet,
petitioner recognized Atty. Solutas authority to sign the same and, thus,
acknowledged its binding effect. On the other hand, the July 14, 1993 letter was
written on the same type of paper with the same letterhead and of the same form as
the earlier letter. It was also signed by the same person with the conformity of the
same respondents. Again, nowhere in said letter did petitioner specifically
authorize Atty. Soluta to sign it for and on its behalf. This time, however,
petitioner questioned the validity and binding effect of the agreement, arguing that
Atty. Soluta was not authorized to modify the earlier terms of the contract and
could not in any way bind the petitioner.
We beg to differ.
The general rule is that, in the absence of authority from the board of
directors, no person, not even its officers, can validly bind a corporation. The
power and responsibility to decide whether the corporation should enter into a
contract that will bind the corporation is lodged in the board of
directors. However, just as a natural person may authorize another to do certain
acts for and on his behalf, the board may validly delegate some of its functions and
powers to officers, committees and agents. The authority of such individuals to
bind the corporation is generally derived from law, corporate bylaws or
authorization from the board, either expressly or impliedly, by habit, custom, or
acquiescence, in the general course of business.[34]
The authority of a corporate officer or agent in dealing with third persons
may be actual or apparent. The doctrine of apparent authority, with special
reference to banks, had long been recognized in this jurisdiction.[35] Apparent
authority is derived not merely from practice. Its existence may be ascertained
through 1) the general manner in which the corporation holds out an officer or
agent as having the power to act, or in other words, the apparent authority to act in
general, with which it clothes him; or 2) the acquiescence in his acts of a
particular nature, with actual or constructive knowledge thereof, within or beyond
the scope of his ordinary powers.[36]
Accordingly, the authority to act for and to bind a corporation may be
presumed from acts of recognition in other instances, wherein the power was
exercised without any objection from its board or shareholders. Undoubtedly,
petitioner had previously allowed Atty. Soluta to enter into the first agreement
without a board resolution expressly authorizing him; thus, it had clothed him with
apparent authority to modify the same via the second letter-agreement. It is not the
quantity of similar acts which establishes apparent authority, but the vesting of a
corporate officer with the power to bind the corporation.[37]
Naturally, the third person has little or no information as to what occurs in
corporate meetings; and he must necessarily rely upon the external manifestations
of corporate consent. The integrity of commercial transactions can only be
maintained by holding the corporation strictly to the liability fixed upon it by its
agents in accordance with law.[38] What transpires in the corporate board room is
entirely an internal matter. Hence, petitioner may not impute negligence on the
part of the respondents in failing to find out the scope of Atty. Solutas
authority. Indeed, the public has the right to rely on the trustworthiness of bank
officers and their acts.[39]
As early as June 1993, or prior to the 90-day period within which to make
the full payment, respondents already requested a modification of the earlier
agreement such that the full payment should be made upon receipt of this Courts
decision confirming petitioners right to the subject property. The matter was
brought to the petitioners attention and was in fact discussed by the members of
the Board. Instead of acting on said request (considering that the 90-day period
was about to expire), the board deferred action on the request. It was only after
one year and after the banks reorganization that the board rejected respondents
request. We cannot therefore blame the respondents in relying on the July 14,
1993 Letter-Agreement. Petitioners inaction, coupled with the apparent authority
of Atty. Soluta to act on behalf of the corporation, validates the July 14 agreement
and thus binds the corporation. All these taken together, lead to no other
conclusion than that the petitioner attempted to defraud the respondents. This is
bolstered by the fact that it forged another contract involving the same property,
with another buyer, the spouses Vaca, notwithstanding the pendency of the instant
case.
We would like to emphasize that if a corporation knowingly permits its
officer, or any other agent, to perform acts within the scope of an apparent
authority, holding him out to the public as possessing power to do those acts, the
corporation will, as against any person who has dealt in good faith with the
corporation through such agent, be estopped from denying such authority.[40]
Petitioner further insists that specific performance is not available to
respondents because the Letter-Agreements had already been rescinded --- the
March 18 agreement because of the breach committed by the respondents; and the
July 14 letter because of the new offer of the respondents which was not approved
by petitioner.
Again, the argument is misplaced.
Basic is the rule that a contract constitutes the law between the
parties. Concededly, parties may validly stipulate the unilateral rescission of a
contract.[41] This is usually in the form of a stipulation granting the seller the right
to forfeit installments or deposits made by the buyer in case of the latters failure to
make full payment on the stipulated date. While the petitioner in the instant case
may have the right, under the March 18 agreement, to unilaterally rescind the
contract in case of respondents failure to comply with the terms of the contract,
[42]
the execution of the July 14 Agreement prevented petitioner from exercising the
right to rescind. This is so because there was in the first place, no breach of
contract, as the date of full payment had already been modified by the later
agreement.
Neither can the July 14, 1993 agreement be considered abandoned by
respondents act of making a new offer, which was unfortunately rejected by
petitioner. A careful reading of the June 6, 1994 letter of respondents impels this
Court to believe that such offer was made only to demonstrate their capacity to
purchase the subject property.[43] Besides, even if it was a valid new offer, they did
so only due to the fraudulent misrepresentation made by petitioner that their earlier
contracts had already been rescinded. Considering respondents capacity to pay
and their continuing interest in the subject property,[44] to abandon their right to the
contract and to the property, absent any form of protection, is contrary to human
nature. The presumption that a person takes ordinary care of his concerns applies
and remains unrebutted.[45] Obviously therefore, respondents made the new offer
without abandoning the previous contract. Since there was never a perfected new
contract, the July 14, 1993 agreement was still in effect and there was no
abandonment to speak of.
another especially if the latter performs acts to protect his rights such as the timely
registration of a notice of lis pendens.
As to the liability for moral damages, attorneys fees and expenses of
litigation, we affirm in toto the appellate courts conclusion. Article 2220[49] of the
New Civil Code allows the recovery of moral damages in breaches of contract
where the party acted fraudulently and in bad faith. As found by the CA, petitioner
undoubtedly acted fraudulently and in bad faith in breaching the letteragreements. Despite the pendency of the case in the RTC, it sold the subject
property to the spouses Vaca and allowed the demolition of the house even if there
was already a writ of preliminary injunction lawfully issued by the court. This is
apart from its act of unilaterally rescinding the subject contract. Clearly,
petitioners acts are brazen attempts to frustrate the decision that the court may
render in favor of respondents.[50] It is, likewise, apparent that because of
petitioners acts, respondents were compelled to litigate justifying the award of
attorneys fees and expenses of litigation.
WHEREFORE, premises considered, the petition is DENIED. The
Decision of the Court of Appeals dated February 27, 2001 and its Resolution
datedMay 31, 2001 in CA-G.R. CV No. 60315 are AFFIRMED.
SO ORDERED.