Dear PAO,

I am currently living in Manila, but I own a parcel of land in Bacolod, where my sister resides. I recently visited Bacolod to see if I can develop that parcel of land for additional income. However, I learned that my sister sold my land to a third person. The buyers claimed my sister told them I authorized her to sell my land. I remember that we talked about it, but my instructions were clear that my sister should wait for my final decision to sell the land. I did not execute any written document that would authorize her to sell the land. I want to know if such a sale is valid.

Nic

Dear Nic,

First and foremost, it is important to understand the concept of a contract of agency. Article 1868 of the New Civil Code defines a contract of agency as one in which the agent binds himself to do something in the representation of the principal. One of the most important requirements of a contract of agency is that the principal should authorize the agent to act on his or her behalf.

For the sale of a parcel of land through an agent, Article 1874 of the New Civil Code requires that the authority of the agent should be in writing, to quote:

“ARTICLE 1874. 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.”

Furthermore, it is also provided under Article 1878 (5) of the New Civil Code that a special power of attorney is necessary in order for an agent to enter into any contract which involves the transmission of ownership of an immovable property, viz.:

“Article 1878. Special powers of attorney are necessary in the following cases: xxx

“(5) To enter into any contract by which the ownership of an immovable is transmitted or acquired either gratuitously or for a valuable consideration;”

It is clear from the above-mentioned provisions of the law that if the principal, who is the owner of the land, wishes to sell his or her land through an agent, he or she should execute a written authorization, which is also called a special power of attorney. Therefore, a verbal authorization would not suffice.

If a person enters into a contract of sale of land without a valid special power of attorney from the owner, then such sale is void. As aptly ruled by the Supreme Court in Sps. Alcantara and Sps. Rubi v. Nido, GR 165133, April 19, 2010, through Associate Justice Antonio Carpio:

“Article 1874 of the Civil Code explicitly requires a written authority before an agent can sell an immovable property. Based on a review of the records, there is absolutely no proof of respondent’s written authority to sell the lot to petitioners. In fact, during the pre-trial conference, petitioners admitted that at the time of the negotiation for the sale of the lot, petitioners were of the belief that respondent was the owner of lot. Petitioners only knew that Revelen was the owner of the lot during the hearing of this case. Consequently, the sale of the lot by respondent who did not have a written authority from Revelen is void. A void contract produces no effect either against or in favor of anyone and cannot be ratified.” (Emphasis supplied)

In your case, the sale of the parcel of land by your sister to the buyers may be considered void because, as you narrated, you did not execute any written document that would authorize her to sell your property on your behalf. Absent such authority, your property cannot be disposed of by your sister, by sale or otherwise. As such, you may recover your property from the buyers.

We hope that we are able to answer your queries. This advice is based solely on the facts you have narrated and our appreciation of the same. Our opinion may vary when other facts are changed or elaborated.

Thank you for your continued trust and support.

Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to [email protected]