CUI v.

CUI
Agency - General Provisions

Court Supreme Court En Banc

Citation G.R. No. L-7041
Date February 21, 1957
Plaintiffs-Appellants Jesus Ma. Cui, et. al.
Defendants-Appellees Antonia Ma. Cui, et. al.
Ponente J. Bautista-Angelo
Relevant topic Under Article 1459 of the old Civil Code an agent or administrator is disqualified from
purchasing property in his hands for sale or management.

Under the provisions of Article 1491(2) of the new Civil Code, an agent may now buy
property placed in his hands for sale or administration, provided that the principal gives his
consent thereto.
Prepared by

FACTS
 Plaintiffs and defendants were the legitimate children of Don Mariano Cui and Doña Antonia Perales who died
intestate.
 Plaintiffs alleged in their complaint against defendants for annulment of sale and declaration of mortgage as null
and void that:
o During the marriage of Don Mariano and Doña Antonia, they acquired three parcels of land in Cebu City.
o Upon the death of Doña Antonia, the conjugal partnership did not leave any indebtedness and the
conjugal properties were placed under the administration of Don Mariano.
o While Don Mariano was 84 years of age and under the influence of the defendants, the latter, by means
of deceit, secured the transfer to themselves of the aforementioned lots without any pecuniary
consideration.
o Defendants fraudulently, and with the desire to unjustly enrich themselves at the expense of Don Mariano
and of their brothers and co-heirs, secured a loan from the Rehabilitation Finance Corporation by
encumbering the properties.
 Plaintiffs prayed that the sale and mortgage executed on the properties in question, in so far as the shares of the
plaintiffs are concerned, be declared null and void.
 It should be noted that six (6) days before the deed of sale was executed, Don Mariano executed a power of
attorney in favor of defendant, making the latter the true and lawful attorney to perform in the former’s name and
that of the intestate heirs of Doña Antonia the acts enumerated therein.
 Defendants on the other hand aver that:
o The properties were the exclusive property of Don Mariano up to the time they were transferred to
defendants because they were acquired by him as a donation from his uncle, Don Pedro and his aunt,
Doña Benigna.
o This fact was known to the plaintiffs and to the guardian of Don Mariano, Victorino Reynes, because in
the extrajudicial partition executed between plaintiffs and defendants of the properties of Doña Antonia,
the three lots in question did not form part of the conjugal properties of the spouses.
o Don Mariano, for a consideration, voluntarily and without deceit, pressure or influence on the part of
defendants, executed and signed the deed of sale.
o Don Mariano was, at that time, in full enjoyment of his mental faculties and only suffered loss of memory
several years later when he was declared by the court incompetent to manage his properties.
 On appeal, appellants contend that the lower court erred:
o In not declaring the deed of sale void or inexistent for lack of valid consent and consideration.
o In not declaring illegal the sale on the ground that it was a transaction between principal and agent, which
is prohibited by Article 1459(2) of the old Civil Code.
o In not finding that the three lots conveyed by means of the deed of sale belong to the unliquidated
conjugal partnership of Don Mariano and Doña Antonia, and that consequently, Don Mariano could not
validly sell the entire property.

ISSUE #1 HELD
W/N the transfer of the properties to Antonio Cui by way of a deed of sale executed by Don NO
Mariano was invalid because Antonio was the agent and administrator of the properties of Don
Mariano.

PRELIMINARIES
1
CUI v. CUI
Agency - General Provisions

 Petitioners allege that Don Mariano did not and could not have validly consented to the deed of sale in question,
because:
o Don Mariano was incapacitated to give his consent by reason of his age and ailment;
o Don Mariano acted under a mistake, and his signature was secured by means of deceit; and
o The sale is vitiated by undue influence.
 The Court held that such allegations were merely based on surmises or conjectures or circumstances which,
though they may show inferentially that he was sickly or forgetful because of his advanced age, do not however
point unremittingly to the conclusion that at the time he signed said deed of sale he was not in full enjoyment of
his mental faculties as to disqualify him to do so or that he was not aware of the nature of the transaction he was
then undertaking.
 Weakness of mind alone, not caused by insanity, is not a ground for avoiding a contract, for it is still necessary to
show that the person at the time of doing the act "is not capable of understanding with reasonable clearness the
nature and effect of the transaction in which he is engaging.
o Only when there is "great weakness of mind in a person executing a conveyance of land, arising from
age, sickness, or any other cause," can a person ask a court of equity to interfere in order to set aside the
conveyance.
o Evidence shows that such is not the case, for the several letters and documents signed and executed by
Don Mariano many months after the execution of the deed of sale Exhibit A clearly indicate that, while he
was of an advanced age, he was however still physically t and his mind was keen and clear.

THE COURT’S RULING

 Appellants argue that the sale should be invalidated at least in so far as the portion of the property sold to Antonio
Cui is concerned, for the reason that when that sale was effected, he was then acting as the agent or
administrator of the properties of Don Mariano Cui.
o Appellants lay stress on the power of attorney which was executed by Don Mariano in favor of Antonio
Cui herein the former has constituted the latter as his "true and lawful attorney" to perform in his name
and that of the intestate heirs of Doña Antonia Perales the following acts:

“[T]o administer, sell, mortgage, lease, demand, claim, represent me and the intestate heirs, in all
meetings of corporations, associations, of which my or their presence is required, sue for, collect, cash,
indorse checks drawn in my favor or of the intestate heirs against any person or entity or bank, and sign
all documents, that I and or the intestate heirs to which I am the administrator are entitled to; giving and
granting unto my said attorney full power to perform and to make everything necessary to be done or
which he believes to be necessary or beneficial for me and the said heirs as fully and to all intents and
purposes as I might or could do if personally present, with full power of substitution, and revocation,
hereby granting ratifying all that he or his substitutes shall lawfully do or cause to be done by virtue of
these presents.”
 While under Article 1459 of the old Civil Code an agent or administrator is disqualified from purchasing property in
his hands for sale or management, and, in this case, the property in question was sold to Antonio Cui while he
was already the agent or administrator of the properties of Don Mariano Cui, this question cannot now be raised
or invoked for the following reasons:
o The contention was raised in the appeal for the first time.
 It was never raised in the trial court.
 Section 19, Rule 48 of the Rules of Court provides that an appellant may only include "in his
assignment of error any question of law or of fact that has been raised in the court below and
which is within the issues made by the parties in their pleadings.”
 Appellants are now prevented from raising this question for the first time in this instance.
o The power of attorney refers to the conjugal properties wherein Antonio had one-half interest and the
heirs of Doña Antonia, the remaining half.
 Moreover, the power of attorney was executed on March 2, 1946 while the deed of sale was
executed on March 8, 1946. They were therefore executed practically at the same time, which
makes it doubtful as to whether such sale can be deemed to be within the prohibition of the law.
o The prohibition contained in Article 1459 of the old Civil Code has already been repealed by the new Civil
Code.
 Under the provisions of Article 1491(2) of the new Civil Code, an agent may now buy property
placed in his hands for sale or administration, provided that the principal gives his consent
thereto.

2
CUI v. CUI
Agency - General Provisions

 While the new Code came into effect only on August 30, 1950, however, since this is a right that
is declared for the first time, the same may be given retroactive effect if no vested or acquired
right is impaired (Article 2253, new Civil Code).
 During the lifetime of Don Mariano, and particularly on March 8, 1946, the herein appellants could
not claim any vested or acquired right in these properties, for, as heirs, the most they had was a
mere expectancy.
 On the question of the nature of the properties in question, the Court held that appellants claim that the properties
belong to the conjugal partnership of Don Mariano Cui and Doña Antonia Perales because they were acquired
during the marriage, and that therefore, in disposing of the properties, Don Mariano has appropriated what
belongs to his co-heirs, were rebutted by conclusive and strong evidence to the contrary.
o It has been clearly established by evidence consisting of testimonies and numerous documents, the
genuineness of which were not disputed, that the donation by Don Mariano’s uncle, Don Pedro, was
made exclusively to Don Mariano.
o There can therefore be no doubt, in the light of the overwhelming evidence, testimonial as well as
documentary, that the lots in question have always been considered not only by Don Mariano Cui, but by
his children and other relatives, as his exclusive property, the same having been donated to him by his
uncle Don Pedro to the exclusion of his wife Antonia Perales. Consequently, the contention that, in
disposing of said property, Don Mariano Cui has appropriated what belongs to his co-heirs, has
completely no foundation in the evidence.

RULING

Having reached the conclusion that the lots in question were the exclusive property of Don Mariano Cui and that the deed
of sale was executed by him freely, intelligently, and with sufficient pecuniary consideration, we uphold its validity if we are
to be consistent with our conclusion that Don Mariano has executed it while still in the full enjoyment of his mental
faculties, considering that he never lifted a finger to dispute it.