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SHOPPERS PARADISE REALTY AND DEVELOPMENT CORP. V.

ROQUE
GR. NO. 148775, JAN. 12, 2004
VITUG, J.
Facts:
 Petitioner through its President Atienza entered into a 25 year lease with Dr. Felipe roque over a parcel of land in
QC which was registered in the name of Dr. Roque
o There was an agreement to annotate this lease to the title but never pushed through
 Upon the death of Dr. Roque, the petitioner then negotiated with the son, Respondent in this case Efren Roque
o But negotiations broke down due to certain disagreements
 Respondent then advised petitioner to desist from enforcing the lease
 Later, respondent sought the annulment of the lease contract
o This was on the ground that the lease made by his father was invalid
o Since he was the long-time owner of said property
o Which was passed on to him by a donation inter vivos
o Which was also registered allegedly
 TC DISMISSED THE COMPLAINT
 CA REVERESED FOR ROQUE
o That the lessee was not in good faith having the knowledge of the donation to the respondent
o And this actual knowledge was a registration insofar as the petitioner was concerned
Issue:
 WON Dr. Roque can be considered as the agent of Efren Roque over the lease of the property?
Ruling:
 No. The act of registration shall be the operative act to convey or affect the land insofar as third persons are
concerned, and in all cases under this Decree, the registration shall be made in the office of the Register of Deeds
for the province or city where the land lies.
 A person dealing with registered land may thus safely rely on the correctness of the certificate of title issued
therefore, and he is not required to go beyond the certificate to determine the condition of the property
o but, where such party has knowledge of a prior existing interest which is unregistered at the time he
acquired a right thereto, his knowledge of that prior unregistered interest would have the effect of
registration as regards to him.
 petitioner, through its representatives, was apprised of the fact that the subject property actually belonged to
respondent.
o That there was already a transfer of ownership
 It was not shown that Dr. Felipe C. Roque had been an authorized agent of respondent.
 Article 1878 of the Civil Code expresses that a special power of attorney is necessary to lease any real property to
another person for more than one year.
o The lease of real property for more than one year is considered not merely an act of administration but
an act of strict dominion or of ownership.
o A special power of attorney is thus necessary for its execution through an agent.
 No laches Laches, no estoppel in its real sense, is the failure or neglect, for an unreasonable and unexplained
length of time, to do that which, by exercising due diligence, could or should have been done earlier; it is
negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled
to assert it either has abandoned or declined to assert it.
 Respondent learned of the contracts only in February 1994 after the death of his father, and in the same year,
during November, he assailed the validity of the agreements.
o Hardly, could respondent then be said to have neglected to assert his case for unreasonable length of
time.
o It has not been shown that respondent intended to conceal the actual facts concerning the property;
more importantly, petitioner has been shown not to be totally unaware of the real ownership of the
subject property.
 Altogether, there is no cogent reason to reverse the Court of Appeals in its assailed decision.
VDA. DE CHUA V. IAC
GR. NO. 70909, JAN. 5, 1994
QUIASON, J.
Facts:
 Herrera (PR) executed a contract of lease in favor of Tian On
o This lease was with an option to buy and that the lease can last for 10 years
 Tian On erected a residential house in the leased premises
 Within 4 years from the execution of the lease contract, Tian On then executed a Deed of Absolute Sale in favor
of Chua Bok
o The subject of the sale was the house built on the leased land by Tian On
o It included the corresponding obligations in the contract of lease
 Chua Bok resided on the same and faithfully paid rentals
 After the expiration of the contract of lease, Chua Bok and Herrera (through alleged atty in fact) entered into
another contract of lease (5 years)
 Despite the lease expired, the Chua Bok still occupied the property
 Later on, the said property was sold to the respondents in this case which was contracted by the atty in fact of
Herrera with Sps. Go
o This sale was countered by the Chua Bok and sought to be annulled
o Alleging that it was a violation of their option to buy the leased premises
 TC DISMISSED THE COMPLAINT
 CA AFFIRMED
o With modification as to the Chua ejectment
o AND DECLARING THAT THE AGENT, DE REYNES WAS NOT AUTHORIZED TO ENTER IN THE CONTRACT OF
LEASE
 Petitioners contend that the ejectment and demolition order was not valid since they had the right to possess the
property relying on the contract of lease

Issue:
 WON the lease entered into was valid for the alleged defect of the agent’s authority?
Ruling:
 No. In the lease contract which involves the lease of real property for a period of more than one year
 The contract was entered into by the agent of the lessor and not the lessor herself
 In such a case, the law requires that the agent be armed with a special power of atty to lease the premises
 Such is what is stated in Art. 1878
BA FINANCE V. CA
GR. NO. 94566, JULY 3, 1992
MEDIALDEA, J,
Facts:
 A certain Gaytano applied for and was granted a loan from Traders Royal Bank (Respondent)
o As security there was a deed of suretyship
o Agreement was to solidarity be liable with the bank
 It was the petitioner BA Finance who undertook to guarantee the loan of 60k
o This was done through BA’s Agent Wong
 Partial paymenrs were then made on the loan leaving an unpaid balance of 85k
 The sps. Gaytano then refused to pay the obligation
o Prompting the respondent bank to file a complaint with the TC for sum of money against them or the
petitioner corporation in the alternate
 Petitioner corporation raised the defense that there was a lack of authority from their credit administrator to bind
the corporation
 TC for respondent bank
 CA AFFIRMED WITH MODIFICATIONS
 Petitioners main contention is that the letter guaranty is ultra vires and unenforceable
o Due to the fact that it was issued by an employee of the corporation beyond its scope of authority
o Since the petitioner itself cannot (due to AOI) to issue guaranties
Issue:
 WON the petitioner can be held liable for the ultra vires authority exercised by its employee?
Ruling:
 No. It is a settled rule that persons dealing with an assumed agent, whether the assumed agency be a general or
special one are bound at their peril, if they would hold the principal liable, to ascertain not only the fact of agency
but also the nature and extent of authority, and in case either is controverted, the burden of proof is upon them
to establish it
 Hence, the burden is on respondent bank to satisfactorily prove that the credit administrator with whom they
transacted acted within the authority given to him by his principal, petitioner corporation.
 The only evidence presented by respondent bank was the testimony of Philip Wong, credit administrator, who
testified that he had authority to issue guarantees as can be deduced from the wording of the memorandum given
to him by petitioner corporation on his lending authority.
 We cannot agree with respondent's contention that the phrase "contingent commitment" set forth in the
memorandum means guarantees.
 It has been held that a power of attorney or authority of an agent should not be inferred from the use of vague or
general words.
o Guaranty is not presumed, it must be expressed and cannot be extended beyond its
 The sole allegation of the credit administrator in the absence of any other proof that he is authorized to bind
petitioner in a contract of guaranty with third persons should not be given weight.
 The representation of one who acts as agent cannot by itself serve as proof of his authority to act as agent or of
the extent of his authority as agent
 Wong's testimony that he had entered into similar transactions of guaranty in the past for and in behalf of the
petitioner, lacks credence due to his failure to show documents or records of the alleged past transactions.
 Anent the conclusion of respondent appellate court that petitioner is estopped from alleging lack of authority due
to its failure to cancel or disallow the guaranty, We find that the said conclusion has no basis in fact.
 Respondent bank had not shown any evidence aside from the testimony of the credit administrator that the
disputed transaction of guaranty was in fact entered into the official records or files of petitioner corporation,
which will show notice or knowledge on the latter's part and its consequent ratification of the said transaction.
 In the absence of clear proof, it would be unfair to hold petitioner corporation guilty of estoppel in allowing its
credit administrator to act as though the latter had power to guarantee.
PACIFIC REHOUSE V. EIB
GR. NO. 184036, OCT. 13, 2010
VELASCO, JR., J.
Facts: