FELIX RALLOS

F: Rallos sisters registered and co-owned a parcel of land. They executed an SPA in
favor of their brother authorizing him to sell the land. One of the sisters died and
later on, the brother sold the undivided shares of the sisters to Felix Go Chan.
The administrator of the deceased sister filed a complaint praying that the sale of
the undivided share of the deceased be unenforceable and that the certificate of
title in the name of Felix Go Chan be cancelled.
I: Whether the sale of the brother was valid considering the death of the principal?
R: Yes.
GENERAL RULE: No. In Art. 1919, one of the means an agency is extinguished is by
the death of the principal. The rationale for the law is found in the juridical basis of
agency which is representation. There being an integration of the personality of the
principal and that of the agent, it is not possible for the representation to continue
to exist once the death of either is established.

The juridical tie between the principal and the agent is severed ipso jure upon
the death of either without necessity for the heirs of the fact to notify the
agent of the fact of death of the former.
a power without an interest conferred upon an agent is dissolved by the
principal's death, and any attempted execution of the power afterward is not
binding on the heirs or representatives of the deceased.

EXCEPTIONS:
(1) that the agency is coupled with an interest (Art 1930), and

ART. 1931. Anything done by the agent, without knowledge of the death of the
principal or of any other cause which extinguishes the agency, is valid and shall be
fully effective with respect to third persons who may have contracted with him in
good faith.
the indispensable requirement that the agent acted without knowledge or notice of the death of the principal In the case before Us the agent
Ramon Rallos executed the sale notwithstanding notice of the death of his principal Accordingly, the agent's act is unenforceable against the
estate of his principal.

DIOLOSA VS IAC AND BATERNA

F: the Baterna is a licensed real estate broker. An agreement was entered into
between him and the Diolosa spouses whereby Baterna is the sales agent of the
spouses to sell, cede or transfer lots in a subdivision owned by the spouses. Months
after, the spouses terminated the services of Baterna.

Baterna on the other hand was severely damaged by the action of the spouses in
terminating the agency. Baterna then claims commission on the lots unsold because
of the rescission of the contract.
ISSUE: Whether the spouses can terminate the agency without paying damages to
Baterna?
RULING: No. the defendants could not terminate the agency agreement, Exh. "A", at
will without paying damages.
* Under the contract, the spouses allowed Baternat
transfer and convey ... until out the subject property as
of." The authority to sell is not extinguished until all the
When, therefore, the petitioners revoked the contract
private respondent for damages for breach of contract.

"to dispose of, sell, cede,

subdivided is fully disposed
lots have been disposed of.
they become liable to the

*the defendants had only six grandchildren. That the defendants wanted to reserve
the twenty seven remaining lots for the six grandchildren is not a legal reason for
defendants rescind the agency agreement. Even if the grandchildren were to be
given one lot each, there would still be twenty-one lots available for sale. Besides it
is undisputed that the defendants have other lands which could be reserved for
their grandchildren.

PNB VS IAC
FACTS: Leticia executed a mortgage to secure her loan. As an agent of her brother
in law, Leticia amended her mortgage to include property belonging to the brother
in law as additional collateral. They both agreed to split the amount but since the
brother in law did not receive his share, he wrote a letter to PNB asking the
rescission of the SPA which he had given to Leticia to mortgage his lot.
PNBs manager advised that the lot was already included as collateral however the
bank assured that it would exclude his lot as collateral for Leticias forthcoming
loan. The bank then advised Leticia to replace the lot with another collateral.
However, Leticia was still able to obtain an additional loan.
The brother in law received letters that Leticia failed to pay the loan and that he is
given a week to settle the obligation. He communicated the same to Leticia to
prevent foreclosure against his property but to no avail. The brother in law then filed
a case against Leticia.

ISSUE: Whether the revocation of the SPA was valid?

RULING: Yes. The mortgage which Sepe gave to the bank on Alcedo's lot as
collateral was null and void for having been already disauthorized by Alcedo. While
it is required that the revocation of an SPA should appear in a public instrument, a
revocation in a private writing is valid and binding between the parties.
The legalization by a public writing and recording of the same in a registry are not
essential requisites of a contract entered into between parties but mere conditions
of form which the law imposes in order that such contract may be valid against third
persons and to insure that the third person respects it.
** The PNB acted with bad faith in proceeding against Alcedo's property to satisfy
Sepe's unpaid 1971-72 sugar crop loan. The extrajudicial foreclosure being null and
void ab initio, the certificate of sale which the Sheriff delivered to PNB as the
highest bidder at the sale is also null and void.