Gregorio Araneta Inc vs Paz Tuason de Paterno

Facts: Tuason was the registered owner of a land. In 1943, Tuason decided to sell the entire land to Gregorio Araneta,
inc. Then war occurred. After the war Tuason repudiated the sale. Gregorio Araneta, Inc instituted an action to compel
Tuason to deliver the title of the subject land. Tuason assails the validity of the sale as Jose Araneta was his agent. Jose
Araneta was referred to as defendant's agent or broker "who acts in this transaction" and who as such was to receive a
commission of 5 per cent.

ISSUE: WON the sale is invalid as Jose Araneta, president of Gregorio Araneta, Inc, is Tuasons agent.

Held: The contract of sale was valid and enforceable.
The ban of paragraph 2 of article 1459( Spanish Civil Code) connotes the idea of trust and confidence; and so
where the relationship does not involve considerations of good faith and integrity the prohibition should not and does not
apply. To come under the prohibition, the agent must be in a fiduciary with his principal.
Jose Araneta was not an agent within the meaning of article 1459. He was to be nothing more than a go-between
or middleman between the defendant and the purchaser, bringing them together to make the contract themselves. There
was no confidence to be betrayed. Jose Araneta was not authorize to make a binding contract for the defendant. He was
not to sell and he did not sell the defendant's property. He was to look for a buyer and the owner herself was to make, and
did make, the sale. He was not to fix the price of the sale because the price had been already fixed in his commission. He
was not to make the terms of payment because these, too, were clearly specified in his commission. In fine, Jose Araneta
was left no power or discretion whatsoever, which he could abuse to his advantage and to the owner's prejudice.