YOSHIZAKI v. JOY TRAINING CENTER OF AURORA, INC.

(2013)
Topic: Special Power of Attorney

PARTIES:
 Petitioner: Sally Yoshizaki
 Respondent: Joy Training Center of Aurora

FACTS:
 Joy Training is a non-stock, non-profit religious educational institution. It was the registered
owner of a parcel of land and the building thereon located in San Luis, Baler, Aurora.
 Nov. 10, 1998 – Sps. Richard and Linda Johnson sold the properties, a Wrangler Jeep, and
other personal properties in favor of Sps. Sally and Yoshio Yoshizaki. On the same date, a
Deed of Absolute Sale and a Deed of Sale of Motor Vehicle were executed in favor of the
Sps. Yoshizaki. The sps. were members of Joy Training’s Board of Trustees at the time of the
sale.
 Dec. 8, 1998 – Joy Training, represented by its Acting Chairperson Reuben Rubio filed an
action for the Cancellation of Sales and Damages with a prayer for the issuance of a TRO
and/or writ of preliminary injunction against Sps. Yoshizaki and Sps. Johnson before the RTC
Baler.
 In the complaint, Joy Training alleged that the Sps. Johnson sold its properties without the
requisite authority from the Board of Directors. It assailed the validity of the board
resolution dated Sept. 1, 1998 which purportedly granted the Sps. Johnson the authority to
sell its real properties. It averred that only a minority of the board, authorized the sale
through the resolution. Joy Training avers that, based on the Articles of Incorporation, there
were 7 members of the Board of Trustees.
 In their answer, the Sps. Yoshizaki claimed that Joy Training authorized the Sps. Johnson to
sell the parcel of land. Moreover, they argued that Connie Dayot, the corporate secretary,
issued a certification on Feb. 20, 1998 authorizing the Sps. Johnson to act on Joy Training’s
behalf. They also highlighted that the Wrangler jeep and the properties were registered in
the names of the Sps. Johnson. However, the Sps. argued that there were only 5 members of
the Board of Trustees.
 The Sps. Yoshizaki formally offered evidence photocopies of the resolution and certification,
among others. Joy Training objected, stating that the photocopied resolution and
certification were not the best evidence of their contents.
 The RTC ruled in favor of the Sps. Yoshizaki and found that Joy Training owned the real
properties. However, it held that the sale was valid because Joy training authorized the Sps.
Johnson to sell the real properties. It recognized that there were only 5 actual members of
the Board of Trustees; consequently, a majority of the board of trustees validly authorized
the sale.
 The CA ruled that the resolution is void because was not approved by a majority of the
Board of Trustees. It stated that under Sec. 25 of the Corp. Code, the basis for determining
the composition of the board of trustees is the list fixed in the articles of incorporation.
Furthermore, Sec. 23 of the same provides that the Board of Trustees shall hold office for
one year and until their successors are elected and qualified. 7 trustees constitute the board
since Joy training did not hold an election after its incorporation.
 The CA did not give any probative value to the certification. It stated that the certification
failed to indicate the date and the names of the trustees present in the meeting and that the
Sps. Yoshizaki did not present the minutes that would prove that the certification had been
issued pursuant to a board resolution.
  Sally Yoshizaki argues that the Sps. Johnson were authorized to sell the parcel of land and
that she was merely a buyer in good faith because she relied on the TCTs which state that
the Sps. Johnson are Joy Training’s representatives.
 Yoshizaki argues that it is a basic principle that a party dealing with a registered land need
not go beyond the certificate of title to determine the condition of the property. In fact, the
resolution and the certification are mere reiterations of the Sps. Johnson’s authority in the
title to sell the real properties. She argues that the resolution and certification are not even
necessary to clothe the Sps. Johnson with the authority to sell the distributed properties,
and that the contract of agency was subsisting at the time of sale because Sec. 108 of PD
1529 requires that revocation of authority must be approved by a court of competent
jurisdiction and no revocation was reflected in the certificate of title.
 Joy Training maintains that it did not authorize the Sps. Johnson to sell its real properties nor
did the TCT specifically grant the authority to sell the parcel of land to the Sps. Johnson.

ISSUES/HELD:
 W/N there was a contract of agency to sell the real properties between Joy Training an the
Sps. Johnson.
o NO. Art. 1868 of the CC defines a contract of agency. It may be express, or implied
from the acts of the principal, from his silence or lack of action, or his failure to
repudiate the agency, knowing that another person is acting on his behalf without
authority.
o As a general rule, a contract of agency may be oral. However, it must be written
when the law requires a specific form. Specifically, Art. 1874 of the CC provides that
the contract of agency must be written for the validity of the sale of a piece of land
or any interest therein. Otherwise the sale shall be void.
o Art. 1878 states that the special powers of attorney are necessary to convey real
rights over immovable properties.
o The special power of attorney mandated by law must be one that expressly
mentions a sale or that includes a sale as a necessary ingredient of the authorized
act.
o A special power of attorney must express the powers of the agent in clear and
unmistakable language for the principal to confer the right upon an agent to sell real
estate. (Cosmic Lumber Corp. v. CA)
o When there is any reasonable doubt that the language so used conveys such power,
no such construction shall be given the document.
o The purpose of the law in requiring an SPA in the disposition of immovable property
is to protect the interest of an unsuspecting owner from being prejudiced by the
unwarranted act of another and to caution the buyer to assure himself of the
specific authorization of the putative agent.
o The evidence presented by Sps. Yoshizaki are: (1) the TCT; (2) the resolution, and (3)
the certification.
o The certification states that the Sps. Johnson were given “FULL AUTHORITY for ALL
SIGNATORY purposes for the corporation on ANY and ALL matters and decisions
regarding the property and ministry here.” The resolution states: “The undersigned
Board of Trustees have authorized the sale of land and building owned by Sps.
Johnson.”
o The above documents do not evidence a contract of agency to sell real properties. It
merely states that Joy Training is represented by the Sps. Johnson. The title does not
explicitly confer to the Sps. Johnson the authority to sell the parcel of land and
building thereon.
 o The lower courts should not have relied on the resolution and the certification. The
Sps. Yoshizaki did not produce the original documents during trial.
o The resolution which purportedly grants the Sps. Johnson an SPA is negated by the
phrase “land and building owned by Sps. Johnson.” Even so, the basis for
determining the board of trustees composition is the trustees as fixed in the Arts. of
Incorporation and not the actual members of the Board.
o Moreover, the certification is a mere general power of attorney which comprises all
of Joy training’s businesses.
o Art. 1877 of the CC clearly states that “[a]n agency couched in general terms
comprises only acts of administration, even if the principal should state that the
withholds no power or that the agent may execute such acts as he may consider
appropriate, or even though the agency should authorize a general and unlimited
management.”

 W/N there was a valid contract of sale of the real properties between Joy Training and the
Sps. Yoshizaki.
o The contract of sale is unenforceable.
o Necessarily, the absence of a contract renders the contract of sale unenforceable.
Joy Training did not enter into a valid contract of sale with the Sps. Yoshizaki.
o Sally cannot claim that she was a buyer in good faith. She misapprehended the rule
that persons dealing with a registered land have the legal right to rely on the face of
the title and to dispense with the need to inquire further, except when the party
concerned has actual knowledge of facts and circumstances that would impel a
reasonably cautious man to make such inquiry. This rule applies when the ownership
of a parcel of land is disputed and not when the fact of agency is contested.
o It is an established principle that persons dealing with an agent must ascertain not
only the fact of agency, but also the nature and extent of the agent’s authority.
o A third person with whom the agent wishes to contract on behalf of the principal
may require the presentation of the power of attorney, or the instructions as
regards the agency.
o The basis for agency is representation and a person dealing with an agent is put
upon inquiry and must discover on his own peril the authority of the agent.
o Thus, Sally bought the real properties at her own risk; she bears the risk of injury
occasioned by her transaction with the spouses Johnson.

DOCTRINE:
 Article 1868 of the Civil Code defines a contract of agency as a contract whereby a person
“binds himself to render some service or to do something in representation or on behalf of
another, with the consent or authority of the latter.”
 The purpose of the law in requiring a special power of attorney in the disposition of
immovable property is to protect the interest of an unsuspecting owner from being
prejudiced by the unwarranted act of another and to caution the buyer to assure himself of
the specific authorization of the putative agent.
 Agency couched in general terms comprises only acts of administration, even if the principal
should state that he withholds no power or that the agent may execute such acts as he may
consider appropriate, or even though the agency should authorize a general and unlimited
management.”
 Persons dealing with an agent must ascertain not only the fact of agency, but also the nature
and extent of the agent’s authority.
JUDGMENT: Petition is DENIED for lack of merit.