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[No.9188.December4,1914.]

GUTIERREZ HERMANOS, plaintiff and appellee, vs.ENGRACIOORENSE,defendantandappellant.

PRINCIPAL AND AGENT; RATIFICATION OF AGENT'SACTS;RETRACTION.Whenapersonwhosoldaparcelofrealestatefor1*1,500appearslaternottobeitsownerandwhen the real owner thereof, upon being questioned in acriminal case instituted against the vendor, states that heconsentedtosuchsale,sothatthevendorwasacquittedofthechargeagainsthim,itisneither'lawfulnorpermissiblefor said owner later to retract and deny his former swornstatement that he had consented to said sale by a thirdperson who was a relative of his. (Civil Code, arts. 1709,1710,1727.)

ID.;ID.;EFFECT INACTIONFORESTAFA.The swornstatement of the owner of the real estate in the action forestafasecuredtheacquittaloftheaccusedbydestroyingthefraudwhich at first appeared to have been perpetrated tothe owner's prejudice and became a confirmation andratificationofthesale;therefore,theownermustfulfilltheobligations contracted by his agent, whomade the sale asthough he had had prior authorization and expressinst.ructionsinwriting.(Conluvs.AranetaandGuanko,15Phil.Rep.,387.)

ID.; ID.; RATIFICATION AS EXPRESS AGENCY.Eventhough the owner of the real estate had not previouslyauthorized the sale andhis consentwas given subsequenttotheact,yetwhenthefactisestablishedthatheapprovedthe action of his relative in selling it as his agent, thissubsequentratificationbytheowneringivinghisapprovaland consent to the sale produeed the effect of an expressagencyandsopurifiedthecontract

572

572 PHILIPPINERERORTSANNOTATED

Gutierrez Hermanos vs. Orense.

of the flaws itcontainedatthetime itwasexecuted. (CivilCode,arts.1259,1313.)

ID.; ID.;ACTION FORNULLITY.The action for nullitythat could have at first been instituted was legallyextinguishedatthemomentwhcnsaidcontractofsalewasvalidlyratifiedandconfirmed.(CivilCode,art.1309.)

APPEALfromajudgmentoftheCourtofFirstInstanceofAlbay.Moir,J.

Thefactsarestatedintheopinionofthecourt.William A. Kincaid, Thos. L. Hartigan, andCeferino M.

Villarealforappellant.Rafael de la Sierraforappellee.

ToRRES,J.:

Appeal through bill of exceptions filed by counsel for theappellantfromthejudgmentrenderedonApril14,1913,bytheHonorableP.M.Moir,judge,whereinhesentencedthedefendant to make immediate delivery of the pfoperty inquestion,throughapublicinstrument,bytransferringandconveying to the plaintiff all his rights in the propertydescribedinthecomplaintandtopayitthesumof=780,asdamages,andthecostsofthesuit.

OnMarch5,1913,counselforGutierrezHermanosfileda complaint, afterwards amended, in the Court of FirstInstanceofAlbayagainstEngracioOrense,inwhichhesetforththatonandbeforeFebruary14,1907,thedefendantOrense had been the owner of a parcel of land, with thebuildingsandimprovementsthereon,situatedinthepuebloofGuinobatan,Albay,thelocation,areaandboundariesofwhichwerespecifiedinthecomplaint;thatthesaidpropertyhasuptodatebeenrecordedinthenewpropertyregistryinthenameofthesaidOrense,accordingtocertificateNo.5,with the boundaries therein given; that, on February 14,1907, Jose Duran, a nephew of the defendant, with thelatter'sknowledgeandconsent,executedbeforeanotaryapublic instrument whereby he sold and conveyed to theplaintiffcompany,forJ*l,500,theaforementionedproperty,thevendorDuranreservingtohimselftherighttore

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VOL.28,DECEMBER4,1914. 573Gutierrez Hermanos vs. Orense.

purchaseitforthesamepricewithinaperiodoffouryearsfrom the date of the said instrument; that the plaintiffcompanyhadnotentered intopossessionof thepurchasedproperty,owingtoitscontinuedoeeupancybythedefendantandhisnephew,JoseDuran,byvirtueofacontractofleaseexecuted by the plaintiff toDuran,which contractwas inforceuptoFebruary14>1911;thatthesaidinstrumentofsaleoftheproperty,executedbyJoseDuran,waspubliclyandfreelyconfirmedandratifiedbythedefendantOrenseinaverbaldeclarationmadebyhimonMarch14,1912,intheCourtofFirst InstanceofAlbay, to theeffect that thesaid instrument of sale was executed by Duran with theknowledge and consent of the defendant, Orense; that, inorder to perfect the title to the saidproperty, theplaintiffhad to demand of the defendant that he execute in legalform a deed of conveyance of the property, but that thedefendantOrense refused todo so,withoutany justifiablecause or reason, wherefore he should be compelled toexecutethesaiddeedbyanexpressorderof thecourt, for

JoseDuran isnotoriously insolventand cannot reimbursethe plaintiff company for the price of the sale which hereceived, nor pay any sum whatever for the losses anddamagesoccasionedbythesaidsale,asidefromthefactthatthe plaintiff had suffered damage by losing the presentvalueoftheproperty,whichwasworth1*3,000;that,unlesssuchdeedoffinalconveyancewereexecutedinbehalf*oftheplaintiff company, it would be injured by the fraudperpetratedby thevendor,Duran, in connivancewith thedefendant; that the latter had been occupying the saidproperty since February 14, 1911, and refused to pay therentalthereof,notwithstandingthedemandmadeuponhimforitspaymentattherateof1*30permonth,thejustandreasonablevaluefortheoccupancyofthesaidproperty,thepossessionofwhichthedefendantlikewiserefusedtodelivertotheplaintiffcompany,inspiteofthecontinuousdemandsmadeuponhim, the defendant,with bad faith and to theprejudice of the firm of Gutierrez Hermanos, claiming tohaverightsof

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574 PHILIPPINEREPORTSANNOTATEDGutierrez Hermanos vs. Orense.

ownershipandpossessioninthesaidproperty.Thereforeitwasprayedthatjudgmentberenderedbyholdingthatthelandandimprovementsinquestionbelonglegitimatelyandexclusively to the plaintiff, and ordering the defendant toexecute in the plaintiff's behalf the said instrument oftransferandconveyanceofthepropertyandofalltheright,interest, title and sharewhich the defendant has therein;thatthedefendantbesentencedtopayP30permonthfordamagesandrentalofthepropertyfromFebruary14,1911,tothedateoftherestitutionofthepropertytotheplaintiff,and that, in case these remedieswere not gianted to theplaintiff,thedefendantbesentencedtopaytoitthesumof1*3,000 as damages, together with interest thereon sincethedateoftheinstitutionofthissuit,andtopaythecostsandotherlegalexpenses.

The demurrer filed to the amended complaint wasoverruled, with exception on the part of the defendant,whose counsel made a general denial of the allegationscontained in the complaint, excepting those that wereadmitted,andspecificallydeniedparagraph4thereoftotheeffectthatonFebruary14,1907,JoseDuranexecutedthedeedofsaleofthepropertyinfavoroftheplaintiffwiththedefendant'sknowledgeandconsent.

As the first special defense, counsel for the defendantallegedthatthefactssetforthinthecomplaintwithrespectto the execution of the deed did not constitute a cause ofaction,nordidthoseallegedintheotherformofactionforthecollectionof1*3,000,thevalueoftherealty.

As the second special defense, he alleged that thedefendantwasthelawfulownerofthepropertyclaimedinthe complaint, as his ownership was recorded in theproperty registry, and that, since his title had beenregisteredundertheproceedings in rem prescribedbyAct

No. 496, it was conclusive against the plaintiff and thepretended rights alleged to have been acquired by JoseDuranpriortosuchregistrationcouldnotnowprevail;thatthe defendant had not executed any written power ofattorneynorgivenanyverbalauthority toJoseDuran inorder

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VOL.28,DECEMBER4,1914. 575Gutierrez Hermanos vs. Crcnse.

thatthelattermight, inhisnameandrepresentation,sellthe said property to the plaintiff company; that the defendant'sknowledgeofthesaidsalewasacquiredlongafterthe execution of the contract of sale between Duran andGutie rrez Hermanos, and that prior thereto thedefendant did not intentionally and deliberately performanyactsuchasmighthaveinducedtheplaintifftobelievethat Duran was empowered and authorized by thedefendant and which would warrant him in acting to hisowndetriment,under the influenceof thatbelief.Counseltherefore prayed that the defendant be absolved from thecomplaint and that the plaintiff be sentenced to pay thecostsandtoholdhispeaceforever.

Afterthehearingofthecaseandanexaminationoftheevidenceintroducedbybothparties,thecourtrenderedthejudgment aforementioned, to which counsel for thedefendantexceptedandmovedforanewtrial.Thismotionwasdenied,anexceptionwastakenbythedefendantand,uponpresentationoftheproperbillofexceptions,thesamewas approved, certified and forwarded to the clerk of thiscourt.

This suit involves the validity and efficacy of the saleunderrightofredemptionofaparceloflandandamasonryhouse with a nipa roof erected thereon, effected by JoseDuran, a nephew of the owner of the property, EngracioOrense, for the sum of f*l,500 by means of a notarialinstrumentexecutedandratifiedonFebruary14,1907.

After the lapse of the four years stipulated for theredemption,thedefendantrefusedtodeliverthepropertytothepurchaser,thefirmofGutierrezHermanos,andtopaytherentalthereofattherateof f*30permonthfor itsuseandoccupationsinceFebruary14,1911,whentheperiodforits repurchase terminated. His refusal was based on theallegationsthathehadbeenandwasthentheownerofthesaid property, which was registered in his name in theproperty registry; that he had not executed any writtenpowerofattorneytoJoseDuran,norhadhegiventhelatteranyverbalauthorizationtosellthesaid

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576 PHILIPPINEREPORTSANNOTATEDGutierrez Hermanos vs. Orense.

propertytotheplaintifffirminhisname;andthat,priorto

theexecutionof thedeedofsale, thedefendantperformednoact suchasmighthave induced theplaintiff tobelievethat Jose Duran was empowered and authorized by thedefendanttoefrectthesaidsale,

Theplaintifffirm,therefore,chargedJoseDuran,intheCourtofFirstInstanceofthesaidprovince,withestafa,forhavingrepresentedhimselfinthesaiddeedofsaletobetheabsolute owner of the aforesaid land and improvements,whereas in reality they did not belong to him, but to thedefendantOrense.However,atthetrialofthecaseEngracioOrense,calledasawitness,beinginterrogatedbythefiscalastowhetherhehadconsentedtoDuran'ssellingthesaidpropertyunderrightofredemptiontothefirmofGutierrezHermanos,repliedthathehad.Inviewofthisstatementbythedefendant,thecourtacquittedJoseDuranofthechargeofestafa.

AsaresultoftheacquittalofJoseDuran,basedontheexplicittestimonyofhisuncle,EngracioOrense,theownerof the property, to the effect that hehad consented to hisnephew Duran's selling the property under right ofrepurchase to Gutierrez Hermanos, counsel for this firmfileda complaintpraying,amongother remedies, that thedefendant Orense be compelled to execute a deed for thetransferandconveyancetotheplaintiffcompanyofalltheright, title and interestwhichOrensehad in thepropertysold,andtopaytothesametherentalofthepropertyduefromFebruary14,1911.

Notwithstanding the allegations of the defendant, therecord in this case shows that he did give his consent inorderthathisnephew,JoseDuran,mightsellthepropertyin question to Gutierrez Hermanos, and that he didthereafterconfirmandratifythesalebymeansofapublicinstrumentexecutedbeforeanotary.

It having been proven at the trial that he gave hisconsent to the said sale, it follows that the defendantconferredverbal,oratleastimplied,powerofagencyuponhisnephew

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VOL.28,DECEMBER4,1914. 577Gutierrez Hermanos vs. Orense.

Duran,whoaccepteditinthesamewaybysellingthesaidproperty. The principal must therefore fulfill all theobligations contracted by the agent,who actedwithin thescope of his authority. (Civil Code, arts. 1709, 1710 and1727.)

Evenshoulditbeheldthatthesaidconsentwasgrantedsubsequently to the sale, it is unquestionable that thedefendant,theowneroftheproperty,approvedtheactionofhis nephew,who in this case acted as themanager of hisuncle's business, and Orense's ratification produced theeffect of an express authorization to make the said sale.(CivilCode,arts.1888and1892.)

Article 1259 of the Civil Code prescribes: "No one cancontract in thenameof anotherwithoutbeingauthorizedbyhimorwithouthavinghislegalrepresentationaccording

tolaw.

"Acontractexecutedinthenameofanotherbyonewhohasneitherhis authorization nor legal representation shall be void, unless itshould be ratified by the person in whose name it was executedbeforebeingrevokedbytheothereontractingparty."

Theswornstatementmadebythedefendant,Orense,whiletestifying as a witness at the trial of Duran for estafa,virtually confirms and ratifies the sale of his propertyeffectedbyhisnephew,Duran,and,pursuanttoarticle1313of the Civil Code, remedies all defects which the contractmayhavecontainedfromthemomentofitsexecution.

ThesaleofthesaidpropertymadebyDurantoGutierrezHermanoswas indeednullandvoid in thebeginning,butafterwardsbecameperfectlyvalidandcuredofthedefecto.fnullityitboreatitsexecutionbytheconfirmationsolemnlymadebythesaidowneruponhisstatingunderoathtothejudgethathehimselfconsentedtohisnephewJoseDuran'smakingthesaidsale.Moreover,pursuanttoarticle1309oftheCode,therightofactionfornullificationthatcouldhavebeenbroughtbecamelegallyextinguishedfromthemomentthecontractwasvalidlyconfirmedand

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578 PHILIPPINEREPORTSANNOTATEDGutierrez Hermanos vs. Orense.

ratified,and, inthepresentcase, it isunquestionablethatthe defendant did confirm the said contract of sale andconsenttoitsexecution.

OnthetestimonygivenbyEngracioOrenseatthetrialofDuranforestafa,thelatterwasacquitted,anditwouldnotbejustthatthesaidtestimony,expressiveofhisconsenttothesaleofhisproperty,whichdeterminedtheacquittalofhis nephew, Jose Duran, who then acted as his businessmanager,andwhichtestimonywipedoutthedeceptionthatin the beginning appeared to have been practiced by thesaid Duran, should not now serve in passing upon theconduct of Engracio Orense in relation to the firm ofGutierrezHermanosinordertoprovehisconsenttothesaleofhisproperty,for,haditnotbeenfortheconsentadmittedbythedefendantOrense,theplaintiffwouldhavebeenthevictimofestafa.

If the defendant Orense acknowledged and admittedunder oath that he had consented to JoseDuran's sellingtheproperty in litigation toGutierrezHermanos, it isnotjust nor is it permissible for him afterward to deny thatadmission, to the prejudice of the purchaser, who gave1*1,500forthesaidproperty.

Thecontractofsaleofthesaidpropertycontainedinthenotarial instrumentofFebruary14,1907, isalleged tobeinvalid,nullandvoidundertheprovisionsofparagraph5ofsection 335 of the Code of Civil Procedure, because theauthoritywhichOrensemayhavegiventoDurantomakethesaidcontractofsaleisnotshowntohavebeeninwritingandsignedbyOrense,buttherecorddisclosessatisfactoryand conclusive proof that the defendant Orense gave his

consent to the contract of sale executed in a publicinstrument by his nephew JoseDuran. Such consentwasproven inacriminalactionby thesworn testimonyof theprincipal and presented in this civil suit by other sworntestimcny of the same principal and by other evidence towhich the defendant made no obejction. Therefore theprincipal is bound to abide by the consequences of hisagencyasthoughithadactuallybeengiveninwriting.

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VOL.28,DECEMBER4,1914. 579Juda vs. Clayton and Clayton.

(Conluvs.AranetaandGuanko,15Phil.Rep.,387;Gallemitvs. Tabiliran, 20 Phil. Rep., 241; Kuenzle & Streiff vs.Jiongco,22Phil.Rep.,110.)

The repeated and successive statements made by thedefendantOrenseintwoaetions,whereinheaffirmedthathehadgivenhisconsenttothesaleofhisproperty,meettherequirements of the law and legally exeuse the lack ofwrittenauthority,and,astheyareafullratificationoftheactsexecutedbyhisnephewJoseDuran,theyproducetheeffectsofanexpresspowerofagency.

Thejudgmentappealedfromisinharmonywiththelawandthemeritsofthecase,andtheerrorsassignedtheretohavebeendulyrefutedbytheforegoingconsiderations,soitshouldbeaffirmed.

Thejudgmentappealedfromisherebyaffirmed,withthecostsagainsttheappellant.

Arettano, C. J., Johnson, Carson, Moreland, andAraullo,JJ.,concur.

Jndgment affirmed.

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