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9/10/2018 SUPREME COURT REPORTS ANNOTATED VOLUME 265

168 SUPREME COURT REPORTS ANNOTATED


Cosmic Lumber Corporation vs. Court of Appeals

*
G.R. No. 114311. November 29, 1996.

COSMIC LUMBER CORPORATION, petitioner, vs. COURT


OF APPEALS and ISIDRO PEREZ, respondents.

Agency; Special Powers of Attorney; Compromise Agreements;


Sales; Pre-Trial; Ejectment; A special power of attorney for an agent
to institute any action in court to eject all persons in the principal's
lots so that the principal could take material possession thereof, and
for this purpose, to appear at the pre-trial and enter into any
stipulation of facts and/or compromise agreement but only insofar as
this is protective of the rights and interests of the principal in the
property, does not grant any power to the agent to sell the subject
property nor a portion thereof.—We agree with petitioner. The
authority granted Villamil-Estrada under the special power of attorney
was explicit and exclusionary: for her to institute any action in court to
eject all persons found on Lots Nos. 9127 and 443 so that petitioner
could

________________

* FIRST DIVISION.

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Cosmic Lumber Corporation vs. Court of Appeals

take material possession thereof, and for this purpose, to appear at the
pre-trial and enter into any stipulation of facts and/or compromise
agreement but only insofar as this was protective of the rights and
interests of petitioner in the property. Nowhere in this authorization
was Villamil-Estrada granted expressly or impliedly any power to sell
the subject property nor a portion thereof. Neither can a conferment of
the power to sell be validly inferred from the specific authority "to
enter into a compromise agreement" because of the explicit limitation
fixed by the grantor that the compromise entered into shall only be "so
far as it shall protect the rights and interest of the corporation in the
aforementioned lots" In the context of the specific investiture of
powers to Villamil-Estrada, alienation by sale of an immovable
certainly cannot be deemed protective of the right of petitioner to
physically possess the same, more so when the land was being sold for
a price of P80.00 per square meter, very much less than its assessed
value of P250.00 per square meter, and considering further that
petitioner never received the proceeds of the sale.

Same; Same; Same; Same; The express mandate required by law


to enable an appointee of an agency (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 action mentioned.—When the sale of a
piece of land or any interest thereon is through an agent, the authority
of the latter shall be in writing; otherwise, the sale shall be void. Thus
the authority of an agent to execute a contract for the sale of real estate
must be conferred in writing and must give him specific authority,
either to conduct the general business of the principal or to execute a
binding contract containing terms and conditions which are in the
contract he did execute. 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. The express mandate required by law to enable an
appointee of an agency (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

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there is any reasonable doubt that the language so used conveys such
power, no such construction shall be given the document.

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Cosmic Lumber Corporation vs. Court of Appeals

Same; Same; Same; Courts; Jurisdiction; The nullity of the


settlement between an agent and a third person impairs the jurisdiction
of the trial court to render its decision based on the compromise
agreement.—It is therefore clear that by selling to respondent Perez a
portion of petitioner's land through a compromise agreement, Villamil-
Estrada acted without or in obvious authority. The sale ipso jure is
consequently void. So is the compromise agreement. This being the
case, the judgment based thereon is necessarily void. Antipodal to the
opinion expressed by respondent court in resolving petitioner's motion
for reconsideration, the nullity of the settlement between Villamil-
Estrada and Perez impaired the jurisdiction of the trial court to render
its decision based on the compromise agreement.

Actions; Courts; Judgments; Annulment of Judgments; Pleadings


and Practice; A party may now petition the Court of Appeals to annul
and set aside judgments of Regional Trial Courts.—Under authority of
Sec. 9, par. (2), of B.P. Blg. 129, a party may now petition the Court of
Appeals to annul and set aside judgments of Regional Trial Courts.
"Thus, the Intermediate Appellant Court (now Court of Appeals) shall
exercise wi wi wi wi (2) Exclusive original jurisdiction over action for
annulment of judgments of the Regional Trial Courts wi wi wi x"
However, certain requisites must first be established before a final and
executory judgment can be the subject of an action for annulment. It
must either be void for want of jurisdiction or for lack of due process
of law, or it has been obtained by fraud. Conformably with law and the
above-cited authorities, the petition to annul the decision of the trial
court in Civil Case No, D-7750 before the Court of Appeals was
proper. Emanating as it did from a void compromise agreement, the
trial court had no jurisdiction to render a judgment based thereon.

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Same; Same; Same; Same; Fraud; Words and Phrases; Fraud


may assume different shapes and be committed in as many different
ways, and here lies the danger of attempting to define fraud, for man in
his ingenuity and fertile imagination will always contrive new schemes
to fool the unwary.—For sure, the Court of Appeals restricted the
concept of fraudulent acts within too narrow limits. Fraud may assume
different shapes and be committed in as many different ways and here
lies the danger of attempting to define fraud. For man in his ingenuity
and fertile imagination will always contrive new schemes to fool the
unwary.

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Cosmic Lumber Corporation vs. Court of Appeals

Same; Same; Same; Same; Same; Same; Extrinsic fraud refers to


any fraudulent act of the prevailing party in the litigation which is
committed outside of the trial of the case, whereby the defeated party
has been prevented from exhibiting fully his side of the case by fraud
or deception practiced on him by his opponent.—There is extrinsic
fraud within the meaning of Sec. 9, par. (2), of B.P. Blg. 129, where it
is one the effect of which prevents a party from hearing a trial, or real
contest, or from presenting all of his case to the court, or where it
operates upon matters, not pertaining to the judgment itself, but to the
manner in which it was procured so that there is not a fair submission
of the controversy. In other words, extrinsic fraud refers to any
fraudulent act of the prevailing party in the litigation which is
committed outside of the trial of the case, whereby the defeated party
has been prevented from exhibiting fully his side of the case by fraud
or deception practiced on him by his opponent. Fraud is extrinsic
where the unsuccessful party has been prevented from exhibiting fully
his case, by fraud or deception practiced on him by his opponent, as by
keeping him away from court, a false promise of a compromise; or
where the defendant never had knowledge of the suit, being kept in
ignorance by the acts of the plaintiff; or where an attorney fraudulently
or without authority connives at his defeat; these and similar cases
which show that there has never been a real contest in the trial or
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hearing of the case are reasons for which a new suit may be sustained
to set aside and annul the former judgment and open the case for a new
and fair hearing.

Agency; Fraud; Equity; When an agent is engaged in the


perpetration of a fraud upon his principal for his own extrinsic benefit,
he is not really acting for the principal but is really acting for himself,
entirely outside the scope of his agency—the basic tenets of agency
rest on the highest considerations of justice, equity and fair play, and
an agent will not be permitted to pervert his authority to his own
personal advantage.—It may be argued that petitioner knew of the
compromise agreement since the principal is chargeable with and
bound by the knowledge of or notice to his agent received while the
agent was acting as such. But the general rule is intended to protect
those who exercise good faith and not as a shield for unfair dealing.
Hence there is a well-established exception to the general rule as where
the conduct and dealings of the agent are such as to raise a clear
presumption that he will not communicate to the principal the facts in
controversy. The logical reason for this exception is that where the
agent is committing a fraud, it would be contrary to com-

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Cosmic Lumber Corporation vs. Court of Appeals

mon sense to presume or to expect that he would communicate the


facts to the principal. Verily, when an agent is engaged in the
perpetration of a fraud upon his principal for his own exclusive benefit,
he is not really acting for the principal but is really acting for himself,
entirely outside the scope of his agency. Indeed, the basic tenets of
agency rest on the highest considerations of justice, equity and fair
play, and an agent will not be permitted to pervert his authority to his
own personal advantage, and his act in secret hostility to the interests
of his principal trascends the power afforded him.

PETITION for review on certiorari of a decision of the Court of


Appeals.
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The facts are stated in the opinion of the Court.


     Millora & Maningding Law Offices for petitioner.
     Manuel D. Ancheta for private respondent.

BELLOSILLO, J.:

COSMIC LUMBER CORPORATION through its General


Manager executed on 28 January 1985 a Special Power of
Attorney appointing Paz G. Villamil-Estrada as attorney-infact

x x x to initiate, institute and file any court action for the ejectment of
third persons and/or squatters of the entire lot 9127 and 443 and
covered by TCT Nos. 37648 and 37649, for the said squatters to
remove their houses and vacate the premises in order that the
corporation may take material possession of the entire lot, and for this
purpose, to appear at the pre-trial conference and enter into any
stipulation of facts and/or compromise agreement so far as it shall
protect the rights and interest of the corporation in the aforementioned
1
lots.

On 11 March 1985 Paz G. Villamil-Estrada, by virtue of her


power of attorney, instituted an action for the ejectment of
private respondent Isidro Perez and recover the possession of

________________

1 CA Rollo, p. 11.

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VOL. 265, NOVEMBER 29, 1996 173


Cosmic Lumber Corporation vs. Court of Appeals

a portion of Lot No. 443 before the Regional


2
Trial Court of
Dagupan, docketed as Civil Case No. D-7750.
On 25 November 1985 Villamil-Estrada entered into a
Compromise Agreement with respondent Perez, the terms of
which follow:

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1. That as per relocation sketch plan dated June 5, 1985


prepared by Engineer Rodolfo dela Cruz the area at
present occupied by defendant wherein his house is
located is 333 square meters on the easternmost part of
lot 443 and which portion has been occupied by
defendant for several years now;
2. That to buy peace said defendant pays unto the plaintiff
through herein attorney-in-fact the sum of P26,640.00
computed at P80.00/square meter;
3. That plaintiff hereby recognizes ownership and
possession of the defendant by virtue of this
compromise agreement over said portion of 333 square
m. of lot 443 which portion will be located on the
easternmost part as indicated in the sketch as annex A;
4. Whatever expenses of subdivision, registration, and
other incidental
3
expenses shall be shouldered by the
defendant.

On 27 November 1985 the "Compromise Agreement" was


approved by the trial court and judgment was rendered in
4
accordance therewith.
Although the decision became final and executory it was not
executed within the 5-year period from date of its finality
allegedly due to the failure of petitioner to produce the owner's
duplicate copy of Title No. 37649 needed to segregate from Lot
No. 443 the portion sold by the attorney-in-fact, Paz G.
Villamil-Estrada, to private respondent under the compromise
agreement. Thus on 25 January 1993 respondent filed a
complaint to revive the judgment, docketed as Civil Case No.
5
D-10459.

________________

2 Assigned to Br. 44.


3 CA Rollo, p. 17.
4 Penned by Judge Crispin C. Laron; id., p. 19.
5 Assigned to Br. 42.

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Cosmic Lumber Corporation vs. Court of Appeals

Petitioner asserts that it was only when the summons in Civil


Case No. D-10459 for the revival of judgment was served upon
it that it came to know of the compromise agreement entered
into between Paz G. Villamil-Estrada and respondent Isidro
Perez upon which the trial court based its decision of 26 July
1993 in Civil Case No. D-7750. Forthwith, upon learning of the
fraudulent transaction, petitioner sought annulment of the
decision of the trial court before respondent Court of Appeals
on the ground that the compromise agreement was void
because: (a) the attorney-in-fact did not have the authority to
dispose of, sell, encumber or divest the plaintiff of its
ownership over its real property or any portion thereof; (b) the
authority of the attorney-in-fact was confined to the institution
and filing of an ejectment case against third persons/squatters
on the property of the plaintiff, and to cause their eviction
therefrom; (c) while the special power of attorney made
mention of an authority to enter into a compromise agreement,
such authority was in connection with, and limited to, the
eviction of third persons/squatters thereat, in order that "the
corporation may take material possession of the entire lot"; (d)
the amount of P26,640.00 alluded to as alleged consideration of
said agreement was never received by the plaintiff; (e) the
private defendant acted in bad faith in the execution of said
agreement knowing fully well the want of authority of the
attorney-in-fact to sell, encumber or dispose of the real property
of plaintiff; and, (f) the disposal of a corporate property
indispensably requires a Board Resolution of its Directors, a
fact which is wanting in said Civil Case No. D7750, and the
General Manager is not the proper officer to encumber a
6
corporate property.
On 29 October 1993 respondent court dismissed the
complaint on the basis of its finding that not one of the grounds
for annulment, namely, lack of jurisdiction, fraud or illegality

________________

6 CA Rollo, pp.5-6.
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Cosmic Lumber Corporation vs. Court of Appeals

7
was shown to exist. It also denied the motion for
reconsideration filed by petitioner, discoursing that the alleged
nullity of the compromise judgment on the ground that
petitioner's attorney-in-fact Villamil-Estrada was not authorized
to sell the subject property may be raised as a defense in the
execution of the compromise judgment as it does not bind
petitioner, but not as a ground for annulment of judgment
because it does not affect the jurisdiction of the8 trial court over
the action nor does it amount to extrinsic fraud.
Petitioner challenges this verdict. It argues that the decision
of the trial court is void because the compromise agreement
upon which it was based is void. Attorney-in-fact Villamil-
Estrada did not possess the authority to sell or was she armed
with a Board Resolution authorizing the sale of its property. She
was merely empowered to enter into a compromise agreement
in the recovery suit she was authorized to file against persons
squatting on Lot No. 443, such authority being expressly
confined to the "ejectment of third persons or squatters of x x x
lot x x x (No.) 443 x x x for the said squatters to remove their
houses and vacate the premises in order that the corporation
may take material possession of the entire lot x x x x"
We agree with petitioner. The authority granted
VillamilEstrada under the special power of attorney was explicit
and exclusionary: for her to institute any action in court to eject
all persons found on Lots Nos. 9127 and 443 so that petitioner
could take material possession thereof, and for this purpose, to
appear at the pre-trial and enter into any stipulation of facts
and/or compromise agreement but only insofar as this was
protective of the rights and interests of petitioner in the
property. Nowhere in this authorization was Villamil-Estrada
granted expressly or impliedly any power to sell the subject
property nor a portion thereof. Neither can a conferment of

________________

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7 Penned by Justice Minerva P. Gonzaga-Reyes with the concurrence of


Justices Santiago M. Kapunan and Eduardo G. Montenegro; Rollo, p. 43.
8 Rollo, p. 49.

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Cosmic Lumber Corporation vs. Court of Appeals

the power to sell be validly inferred from the specific authority


"to enter into a compromise agreement" because of the explicit
limitation fixed by the grantor that the compromise entered into
shall only be "so far as it shall protect the rights and interest of
the corporation in the aforementioned lots." In the context of
the specific investiture of powers to VillamilEstrada, alienation
by sale of an immovable certainly cannot be deemed protective
of the right of petitioner to physically possess the same, more so
when the land was being sold for a price of P80.00 per square
meter, very much less than its assessed value of P250.00 per
square meter, and considering further that petitioner never
received the proceeds of the sale.
When the sale of a piece of land or any interest thereon is
through an agent, the authority of the latter shall be in writing;
9
otherwise, the sale shall be void. Thus the authority of an agent
to execute a contract for the sale of real estate must be
conferred in writing and must give him specific authority, either
to conduct the general business of the principal or to execute a
binding contract containing terms and conditions which are in
10
the contract he did execute. A special power of attorney is
necessary to enter into any contract by which the ownership of
an immovable is transmitted11 or acquired either gratuitously or
for a valuable consideration. The express mandate required by
law to enable an appointee of an agency (couched) in general
terms to sell must be one that expressly mentions a sale or that 12
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 13
such power,
no such construction shall be given the document.
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________________

9 Art. 1874, Civil Code of the Philippines.


10 Johnson v. Lennox, 55 Colo. 125, 133 N. 744.
11 Art. 1878, par. (5), Civil Code of the Philippines.
12 Strong v. Gutierrez Repide, 6 Phil. 680 (1906).
13 Liñan v. Puno, 31 Phil. 259 (1915).

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Cosmic Lumber Corporation vs. Court of Appeals

It is therefore clear that by selling to respondent Perez a portion


of petitioner's land through a compromise agreement, Villamil-
Estrada acted without or in obvious authority. The sale ipso jure
is consequently void. So is the compromise agreement. This
being the case, the judgment based thereon is necessarily void.
Antipodal to the opinion expressed by respondent court in
resolving petitioner's motion for reconsideration, the nullity of
the settlement between VillamilEstrada and Perez impaired the
jurisdiction of the trial court to render its decision based on the
compromise 14
agreement. In Alviar v. Court of First Instance of
La Union, the Court held—

x x x x this court does not hesitate to hold that the judgment in


question is null and void ab initio. It is not binding upon and cannot be
executed against the petitioners. It is evident that the compromise upon
which the judgment was based was not subscribed by them x x x x
Neither could Attorney Ortega bind them validly in the compromise
because he had no special authority x x x x
As the judgment in question is null and void ab initio, it is evident
that the court acquired no jurisdiction to render it, much less to order
the execution thereof x x x
x x x x A judgment, which is null and void ab initio, rendered by a
court without jurisdiction to do so, is without legal efficacy and may
properly be impugned in any proceeding by the party against whom it
is sought to be enforced x x x x
15
This ruling was adopted in Jacinto v. Montesa, by Mr. Justice
J. B. L. Reyes, a much-respected authority on civil law, where
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the Court declared that a judgment based on a compromise


entered into by an attorney without specific authority from the
client is void. Such judgment may be impugned and its
execution restrained in any proceeding by the party against
whom it is sought to be enforced. The Court also

________________

14 64 Phil. 301, 305-306 (1937).


15 No. L-23098, 28 February 1967, 19 SCRA 513, 518-519. See also Quiban
v. Butalid, G.R. No. 90974, 27 August 1990, 189 SCRA 107.

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Cosmic Lumber Corporation vs. Court of Appeals

observed that a defendant against whom a judgment based on a


compromise is sought to be enforced may file a petition for
certiorari to quash the execution. He could not move to have the
compromise set aside and then appeal from the order of denial
since he was not a party to the compromise. Thus it would
appear that the obiter of the appellate court that the alleged
nullity of the compromise agreement should be raised as a
defense against the enforcement is not legally feasible.
Petitioner could not be in a position to question the compromise
agreement in the action to revive the compromise judgment
since it was never privy to such agreement. VillamilEstrada
who signed the compromise agreement may have been the
attorney-in-fact but she could not legally bind petitioner thereto
as she was not entrusted with a special authority to sell the land,
as required in Art. 1878, par. (5), of the Civil Code.
Under authority of Sec. 9, par. (2), of B.P. Blg. 129, a party
may now petition the Court of Appeals 16
to annul and set aside
judgments of Regional Trial Courts. "Thus, the Intermediate
Appellant Court (now Court of Appeals) shall exercise x x x x
(2) Exclusive original jurisdiction over action for annulment of
judgments of the Regional Trial Courts x x x x" However,
certain requisites must first be established before a final and
executory judgment can be the subject of an action for
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annulment. It must either be void for want of jurisdiction or17 for


lack of due process of law, or it has been obtained by fraud.

________________

16 Goldloop Properties, Inc. vs. Court of Appeals, G.R. No. 99431, 11


August 1992, 212 SCRA 498; Mercado v. Ubay, No. L36830, 24 July 1990, 187
SCRA 719; Gerardo v. De la Peña, G.R. No. 61527, 26 December 1990,192
SCRA 691.
17 Islamic Da 'Wah Council of the Philippines v. Court of Appeals, G.R. No.
80892, 29 September 1989, 178 SCRA 178; Ramirez v. Court of Appeals, G.R.
No. 76366, 3 July 1990, 187 SCRA 153; Ruiz v. Court of Appeals, G.R. No.
93454, 13 September 1991, 210 SCRA 577; Santos v. Court of Appeals, G.R.
No. 59771, 21 July 1993, 224 SCRA 673. See also Parcon v. Court of Appeals,
G.R. No. 85740, 9 November 1990,191 SCRA 284.

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Cosmic Lumber Corporation vs. Court of Appeals

Conformably with law and the above-cited authorities, the


petition to annul the decision of the trial court in Civil Case No.
D-7750 before the Court of Appeals was proper. Emanating as
it did from a void compromise agreement, the trial 18
court had no
jurisdiction to render a judgment based thereon.
It would also appear, and quite contrary to the finding of the
appellate court, that the highly reprehensible conduct of
attorney-in-fact Villamil-Estrada in Civil Case No. 7750
constituted an extrinsic or collateral fraud by reason of which
the judgment rendered thereon should have been struck down.
Not all the legal semantics in the world can becloud the
unassailable fact that petitioner was deceived and betrayed by
its attorney-in-fact. Villamil-Estrada deliberately concealed
from petitioner, her principal, that a compromise agreement had
been forged with the end-result that a portion of petitioner's
property was sold to the deforciant, literally for a song. Thus
completely kept unaware of its agent's artifice, petitioner was
not accorded even a fighting chance to repudiate the settlement

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so much so that the judgment based thereon became final and


executory.
For sure, the Court of Appeals restricted the concept of
fraudulent acts within too narrow limits. Fraud may assume
different shapes and be committed in as many different ways
and here lies the danger of attempting to define fraud. For man
in his ingenuity and fertile imagination will always contrive
new schemes to fool the unwary.
There is extrinsic fraud within the meaning of Sec. 9, par.
(2), of B.P. Blg. 129, where it is one the effect of which
prevents a party from hearing a trial, or real contest, or from
presenting all of his case to the court, or where it operates upon
matters, not pertaining to the judgment itself, but to the manner
in which it was procured so that there is not a fair submission of
the controversy. In other words, extrinsic fraud refers to any
fraudulent act of the prevailing party in the litigation which is
committed outside of the trial of the case,

________________

18 See notes 14 and 15.

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Cosmic Lumber Corporation vs. Court of Appeals

whereby the defeated party has been prevented from exhibiting


fully his side of the
19
case by fraud or deception practiced on him
by his opponent Fraud is extrinsic where the unsuccessful
party has been prevented from exhibiting fully his case, by
fraud or deception practiced on him by his opponent, as by
keeping him away from court, a false promise of a compromise;
or where the defendant never had knowledge of the suit, being
kept in ignorance by the acts of the plaintiff; or where an
attorney fraudulently or without authority connives at his
defeat; these and similar cases which show that there has never
been a real contest in the trial or hearing of the case are reasons
for which a new suit may be sustained to set aside and annul the 20
former judgment and open the case for a new and fair hearing.
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It may be argued that petitioner knew of the compromise


agreement since the principal is chargeable with and bound by
the knowledge of or notice to his agent received while the agent
was acting as such. But the general rule is intended to protect
those who exercise good faith and not as a shield for unfair
dealing. Hence there is a well-established exception to the
general rule as where the conduct and dealings of the agent are
such as to raise a clear presumption that he will 21
not
communicate to the principal the facts in controversy. The
logical reason for this exception is that where the agent is
committing a fraud, it would be contrary to common sense to
presume or to expect that he would communicate the facts to
the principal. Verily, when an agent is engaged in the
perpetration of a fraud upon his principal for his own exclusive
benefit, he is not really acting for the principal but is really
22
acting for himself, entirely outside the scope of his agency.

________________

19 Macabingkil v. PHHC, No. L-29080, 17 August 1976, 72 SCRA 326, 343-


344.
20 Id., p. 344 citing US v. Throckmorton, 25 L. Ed. 93, 95.
21 Mutual Life Ins. Co. v. Hilton Green, 241 US 613, 60 L. Ed. 1202.
22 Aetna Casualty and Surety Co. v. Local Bldg. and Loan Assoc., 19 P2d
612, 616.

181

VOL. 265, NOVEMBER 29, 1996 181


Cosmic Lumber Corporation vs. Court of Appeals

Indeed, the basic tenets of agency rest on the highest


considerations of justice, equity and fair play, and an agent will
not be permitted to pervert his authority to his own personal
advantage, and his act in secret hostility to23 the interests of his
principal trascends the power afforded him.
WHEREFORE, the petition is GRANTED. The decision and
resolution of respondent Court of Appeals dated 29 October
1993 and 10 March 1994, respectively, as well as the decision
of the Regional Trial Court of Dagupan City in Civil Case No.
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9/10/2018 SUPREME COURT REPORTS ANNOTATED VOLUME 265

D-7750 dated 27 November 1985, are NULLIFIED and SET


ASIDE. The "Compromise Agreement" entered into between
Attorney-in-fact Paz G. Villamil-Estrada and respondent Isidro
Perez is declared VOID. This is without prejudice to the right of
petitioner to pursue its complaint against private respondent
Isidro Perez in Civil Case No. D-7750 for the recovery of
possession of a portion of Lot No. 443.
SO ORDERED.

          Padilla (Chairman), Vitug and Hermosisima, Jr., JJ.,


concur.
     Kapunan, J., No part, having participated in the CA's
decision.

Petition granted.

Notes.—An action for the nullification of a special power of


attorney and other documents based on an allegation of forgery
is not a "claim" under Sec. 6(c) of P.D. 902-A which provides
for suspension of all actions for claims against corporations,
partnerships or associations under management or receivership.
(Finasia Investments vs. Court of Appeals, 237 SCRA 446
[1994])
Where payment has been made to an agent, aside from
proving the existence of a Special Power of Attorney, it is also
necessary for evidence to be presented regarding the nature

________________

23 Strong v. Strong, 36 A2d 410, 415.

182

182 SUPREME COURT REPORTS ANNOTATED


Municipality of Jimenez vs. Baz, Jr.

and extent of the alleged powers and authority granted to the


agent. (Philippine National Bank vs. Court of Appeals, 256
SCRA 44 [1996])

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