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LIMKETKAI SONS MILLING, INC vs.

CA
Phil Remnants Co constituted BPI as
trustee to manage, administer & sell its
real estate property including one in
Pasig. Revilla, a real estate broker was
given formal authority by BPI to sell the
lot for 1K/sqm w/c was concurred in by
the owners of Phil Remnants.
Revilla contacted Alfonso Lim of Limketkai
Sons who agreed to buy the land. So the
officials of Limketkai & Revilla were given
permission to enter & view the property.
Revilla informed BPI that he had procured
a buyer & 2 officials of Limketkai Sons
(Alfonso Lim & Albino Limketkai) went to
BPI & met w/ the VP (Albano) and Asst VP
(Aromin) of BPI to confirm the sale. They
asked that the price be reduced to
900/sqm but Albano stated the price to be
1,100/sqm. They finally agreed that the
lot be sold at 1K/sqm to be paid in cash.
(Authority to sell was on a first come first
served basis & Limketkai Sons was the
first comer)
Lim asked if it was possible to pay on
terms. BPIs officials said that there was
no harm in trying to ask as the same had
been allowed. However, it was understood
that should the term payment be
disapproved, then price shall be paid in
cash. It was Albano who dictated the
terms under w/c installments payments
may be made & so, Lim wrote to BPI
embodying the initial payment of 10% &
the 90% w/in 90 days.
3 days later, Limketkai Sons learned that
its offer to pay on terms had been frozen.
So Lim went to BPI to tender payment of
33M w/ Albano but he refused stating that
the authority to sell the land had been
w/drawn from his unit. The same check
for 33M was tendered to BPI VP Bona,
who also refused.
Limketkai Sons filed an action for specific
performance w/ damages. In the course
of trial, BPI informed the TC that it had
sold the property to Natl Book Store
(NBS) & the complaint was amended to
include NBS.
TC: In favor of Limketkai. CA: reversed

W/N bank officials were authorized to enter
into the contract? YES
At the start of the transaction, broker
Revilla himself had already full authority
and was acting for & behalf of BPI.
Notwithstanding this, Revilla saw it fit to
bring BPI officials into the transaction. If
BPI could give authority to licensed broker
then there is no reason to doubt the
authority to sell of the BPI officials whose
precise job is to manage & administer real
estate property.
Aromin, BPIs Asst VP & Trust Officer
acted in a perfectly natural manner &
showed no indication that we was acting
ultra vires. This shows that BPI held him
out to the public as the officer routinely
handling such transactions. Everything in
the record points to the full authority of
Aromin to bind the bank (made
negotiations w/ Limketkai, etc) except for
the self-serving memoranda or letters
later produced by BPI that Aromin was an
inefficient & undesirable officer and who in
fact, was dismissed after he testified.

MAIN ISSUE: W/N there was a perfected
contract because of Limketkais request to
pay on terms constituting it as a counter-
offer & negotiations were still in progress at
that point? PERFECTED CONTRACT
Negotiation/Preparation Stage: authority
given by Phil remnants to BPI, authority
given by BPI to broker Revilla, the offer to
sell to Limketkai, the inspection of the
property and the negotiations w/ Aromin
& Albano
Perfection: Aromin & Albano, acting for
BPI, agreed to sell & officers of Limketkai
agreed to buy the lot for 1K/sqm. Aside
from this, there was the earlier agreement
between Limketkai & Revilla there was
a concurrence of offer & acceptance on
the object & the cause
The allegation of NBS that there was no
concurrence of the offer & acceptance of
the cause is belied by Aromin & Albano,
the officials w/ whom the contract was
perfected the fact that the deed of sale
still had to be signed & notarized does not
mean that no contract had already been
perfected
The sale of land is valid regardless of the
form it may have been entered into. The
requisite form under Art 458 is merely for
convenience & failure to comply dos not
affect its validity or binding effect. If the
law requires a document or other special
form, as in the sale of real property, the
contracting parties may compel each
other to observe that form once the
contract has been perfected
STATUTE OF FRAUDS APPLICABLE
because the sale involved real
property. HOWEVER, under Art 1403,
an exception to the unenforceability
of the Statute of Frauds (when a
written contract of sale is not
necessary) is the existence of a
written note or memorandum
evidencing the contract, w/c may be
found in several writing, not only in
one document. The memorandum is
written evidence that such a contract
was entered into. a written
note/memorandum, embodying the
essentials of the contract & signed by the
party charged or his agents suffices to
make the verbal agreement enforceable,
taking it out of the operation of the
statute
While in this case there is no written
contract, there are abundant notes &
memoranda extant in the records
evidencing the elements of a written
contract. (e.g.: ExhPletter to Amorin
authorizing the sale at 1K, giving 2%
commission to the broken & instructing
that sale be on cash basis; ExhBissued
by BPI to Reviila authorizing him to sell
property, etc.) Combining all these
notes & memoranda, SC held that
there is a perfected contract of sale.
No particular form of language or
instrument is necessary to constitute a
memorandum or note in writing under the
statute of frauds

W/N NBS is an innocent purchaser for value?
NO, NBS IN BAD FAITH
NBS ignored the notice of lis pedens
annotated on the title when it bought the
lot. It was the willingness & design of NBS
to buy property already sold to another
party w/c led BPI to dishonor the contract
w/ Limketkai.
BADGES OF FRAUD: 1. Sale was supposed
to be done through authorized broken but
BPI officials personally & directly took
over this particular sale when a close
friend became interested, 2. BPI Sen VP
admitted that NBS Pres was his friend &
had lunch meetings to discuss purchase of
the lot 3. NBS offered 5m then 7M if
Limketkai would drop the case & give up
the lot 4. In an area abound w/ buildings,
NBS had constructed only a warehouse
w/c can easily be dismantled

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