Silva v. Lo

b. Perfection of the contract of agency as it affects third persons (Art. 1873; cf: Art. 1911)

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Case DigestWeek 2 - Formalities of Agency

Silva v. Lo

G.R. No. 206667 · June 23, 2021 · Supreme Court

b. Perfection of the contract of agency as it affects third persons (Art. 1873; cf: Art. 1911)

Petitioner: Guillerma S. SilvaRespondent: Conchita S. Lo

Gist

An heir who had given her mother a special power of attorney later revoked it without telling her, then attacked a family partition agreement her mother had signed for her. The Court upheld the partition: an unnotified revocation does not bind the agent, and the heir's own conduct ratified the settlement.

Core Doctrine

Revocation of an agency takes effect as to the agent only from the time it is communicated to him; acts done by the agent before notice remain valid and bind the principal. A principal who accepts the benefits of, or otherwise acquiesces in, the agent's act is deemed to have ratified it and is estopped from assailing it.

Facts

Carlos Sandico, Jr. died intestate on May 20, 1975, survived by his spouse Concepcion Lim-Sandico and several compulsory heirs, among them petitioner Guillerma Sandico-Silva and respondent Conchita S. Lo.
Intestate proceedings for the settlement of his estate followed and remained pending for decades. (A 1976 extrajudicial settlement and a 1988 memorandum of agreement were both left unimplemented, so in 1989 one heir, Ma. Enrica Sandico-Pascual, sued the rest for partition — Civil Case No. Q-89-3137 before the RTC of Quezon City, Branch 82.)
Conchita (the principal), who was abroad, had earlier executed a Special Power of Attorney (SPA) in favour of her mother, Concepcion (the agent), authorising her to represent Conchita in matters concerning the estate. (The latest of these, dated 8 June 1999, empowered Concepcion "[t]o enter into any compromise, settlement or any agreement with respect to the said case" and "[t]o enter into any partition agreement involving the properties subject of the said case" — the very powers later disputed.)
Concepcion acted under that SPA in the settlement proceedings over a long period. (When the trial court divided the properties by raffle, Concepcion drew lots on her daughter's behalf — the order recording that she "drew ... Lot R-3 for Conchita S. Lo.")
Conchita later executed a document purportedly revoking the SPA on June 26, 2000, but she did not effectively notify Concepcion of the revocation. (She filed a copy of the revocation with the trial court but never furnished her agent one, and she kept the same counsel as the rest of the defendant-heirs.)
In 2006, the heirs executed a Kasunduan — a compromise agreement partitioning the estate. (It covered a 103,024-square-metre agricultural tract at Talimundok, San Agustin, Magalang, Pampanga under TCT No. 377745-R, splitting it evenly with eight tenant-beneficiaries under the voluntary land transfer scheme — following a similar Kasunduan the heirs had signed with the tenants in 1999.)
Conchita's own signature did not appear on it; her interest was represented by Concepcion acting under the SPA.
Conchita subsequently attacked the Kasunduan, arguing that it could not bind her because she had never signed it and because the SPA had already been revoked when it was executed. (She raised it only on 6 November 2009, having let the trial court's 2 March and 13 April 2007 orders approving the new agreement and subdivision plan pass unquestioned even after obtaining copies in 2008.)
Regional Trial Court — partition ordered carried out. On 9 February 2010 the RTC ordered the Register of Deeds of Pampanga to enter new titles in the names of the tenants and the heirs, its earlier 13 April 2007 order having become final; it denied reconsideration on 27 August 2010.
Court of Appeals — orders annulled. On 8 November 2012 the Court of Appeals set those orders aside on certiorari, invalidating the 2006 Kasunduan for want of the signatures of Enrica, Teodoro and Conchita, the last "now repudiat[ing] her mother's, Concepcion's, signature on her behalf."

Issue

Whether the Kasunduan binds Conchita notwithstanding (a) the absence of her signature and (b) her earlier, uncommunicated revocation of the SPA.

Ruling

Yes. The Supreme Court upheld the Kasunduan. Concepcion validly acted for Conchita under the SPA, the unnotified revocation did not defeat her authority, and Conchita's own conduct ratified the settlement.

Ratio

1. The Agent's Signature Is the Principal's Signature

The absence of Conchita's personal signature did not invalidate the agreement.
She had granted her mother a special power of attorney, and an act performed by the agent within the scope of that authority produces the same effect as though the principal had performed it herself.
Concepcion signed for Conchita's account, and Conchita was bound.

2. Revocation Binds the Agent Only from Notice

Conchita's principal argument — that the SPA had already been revoked — failed on the facts and on the law.
The revocation was never effectively communicated to Concepcion.
Revocation of an agency operates as to the agent only from the time it is made known to him.
Until then, the agent's acts within the granted authority remain valid and bind the principal.
A principal cannot secretly withdraw authority and then repudiate what her agent, still believing herself authorised, has done in good faith.
(The rule is stricter still in favour of third persons, who under Article 1922 are unaffected by a revocation of which they had no notice.)

3. Ratification by Conduct

Independently of the SPA, the Court found that the heirs — Conchita included — had ratified the Kasunduan through their acts in the course of the partition proceedings.
Ratification may be express or implied, and is implied from conduct inconsistent with repudiation, such as accepting the benefits of the transaction or participating in its implementation.
Having so acted, Conchita was estopped from disowning the agreement.

4. Policy Favouring Settlement

The Court also weighed the protracted history of the intestate proceedings.
Compromise agreements that fairly partition an estate are favoured, and a party will not be permitted to unsettle a long-implemented family settlement on a technical objection she herself helped render moot.

Doctrine

Effect of the agent's act. Within the scope of the authority conferred, the agent's execution of a document is, in law, the principal's own execution of it; the principal's separate signature is unnecessary.
Revocation requires communication. As against the agent, revocation is effective only upon notice; acts performed before notice remain valid. As against third persons, Article 1922 protects those who dealt with the agent in good faith and without notice of the revocation.
Ratification. A principal who accepts the benefits of, or acquiesces in, an act done for her is deemed to have ratified it — express or implied — and may not thereafter impugn it.

Full Digest — Recitation Format

Full-length digest in the format required by the course digest prompt.

Classification: ANALOGOUS · Ponente: Hernando, J. (Third Division) · G.R. No. 206667, 23 June 2021

TOPIC/SUBTOPIC FOCUS: Week 2 — Formalities of Agency: (b) Perfection of the contract of agency as it affects third persons (Article 1873; cf. Article 1911).

TOPIC DOCTRINE CAPSULE. Article 1873 governs the outward face of an agency: if the principal specially informs a person, or states by public advertisement, that he has given a power of attorney to another, that other is deemed a duly authorized agent as to the person so informed or, in the case of an advertisement, as to any person; and — the operative half for this case — "[t]he power shall continue to be in full force until the notice is rescinded in the same manner in which it was given." Article 1911 supplies the correlative rule that the principal is solidarily liable with the agent where the former allowed the latter to act as though he had full powers. The unifying idea is that as between an innocent third person and a principal who created or tolerated an appearance of authority, the principal bears the risk. The decision is to be checked against this capsule and followed where it differs — and it does differ, as noted below.

I. Gist and Central Doctrine

This case is ANALOGOUS as to the assigned Topic/Subtopic: the Court resolved precisely the problem that Article 1873 addresses — the continuing efficacy, as to persons dealing with an agent, of an authority the principal had secretly revoked — but it did so without citing Article 1873 or Article 1911 at all, anchoring its holding instead on estoppel under Article 1431, on the implied-agency clause of Article 1869, and on ratification of an unauthorized contract under the second paragraph of Article 1317. The controversy arose in a long-running action for partition of the intestate estate of Carlos Sandico, Jr., in which respondent Conchita S. Lo had executed a Special Power of Attorney in favor of her mother Concepcion Lim-Sandico, then quietly revoked it in 2000 by filing a copy with the trial court but never furnishing her agent a copy — after which Concepcion, still acting for her, signed the 2006 Kasunduan partitioning a Pampanga agricultural property and transferring half of it to tenant-beneficiaries under the Comprehensive Agrarian Reform Law. The Supreme Court GRANTED the petition, REVERSED and SET ASIDE the Court of Appeals, REINSTATED the trial court's Orders, and directed the appointment of commissioners. The single doctrine dominant to the Topic/Subtopic is the Court's holding that a principal who revokes an agency but fails to inform the agent "continue[s] to clothe" the agent "with apparent authority to act on her behalf," apparent authority being "based on the principle of estoppel" under Article 1431 and reinforced by Article 1869; and that in any event the unauthorized act was impliedly ratified under Article 1317, paragraph 2. The extensive rulings on the two phases of judicial partition under Rule 69, on indispensable and necessary parties, and on co-ownership under Article 493–Article 498 are treated below as secondary.

II. Chronological Narration of Material Facts and Procedural Events

On 20 May 1975, Carlos Sandico, Jr. died intestate, leaving a sizeable estate to his compulsory heirs: his surviving spouse Concepcion Lim-Sandico, and their children Ma. Enrica Sandico-Pascual, Carlos L. Sandico III, petitioner Guillerma Sandico-Silva, Lily Sandico-Brown, Pamela S. Zapanta, respondent Conchita S. Lo, and Teodoro L. Sandico.
Sometime in 1976 — the stipulation at pre-trial fixes the instrument's date at 18 November 1976 — the heirs executed an Extrajudicial Settlement of Estate providing that all properties of the decedent shall be owned in common, pro indiviso, by his heirs.
In September 1988, the heirs executed a Memorandum of Agreement for the physical division of the estate. Neither this nor the 1976 settlement was ever implemented, and the heirs remained pro indiviso co-owners.
On 3 August 1989, Enrica filed Civil Case No. Q-89-3137 before the RTC, Branch 82, Quezon City, impleading all the other heirs as defendants. Teodoro later withdrew as defendant and joined suit as plaintiff-in-intervention.
Opposing physical division, the defendants asserted Concepcion's usufructuary rights over the estate's real properties and a diminished value and use of the properties if divided. Given the unanimity of their defense, Conchita and two other heirs residing abroad, Lily and Pamela, executed Special Powers of Attorney in favor of their mother Concepcion and their sister Guillerma, respectively.
At pre-trial the parties stipulated, among others, that the case is between members of the same family; that Carlos, Jr. died intestate on 20 May 1975 leaving a legitimate spouse and seven legitimate children as forced heirs; that one half of the conjugal properties constituted his intestate estate; that the parties executed the Extrajudicial Settlement of Estate dated 18 November 1976; and that the fruits or proceeds of the estate were not distributed among the co-heirs because of an alleged grant of usufruct in the mother's favor, whose existence and validity Enrica contested.
On 1 September 1994, the Registry of Deeds of Pampanga issued TCT No. 377745-R over the subject property, a 103,024-square-meter tract of agricultural land at Talimundok, San Agustin, Magalang, Pampanga, in the names of Concepcion and Carlos III, subject to encumbrances listing the other compulsory heirs, and noting Enrica's lis pendens.
In the course of trial the heirs agreed on the manner of dividing each property by raffle conducted by the trial court, drawing lots for an aliquot of each property with Concepcion drawing first. For heirs who failed to attend, their counsel or their appointed attorney-in-fact — either Concepcion or Guillerma, in the case of Conchita, Lily and Pamela — drew the lot on their behalf. The RTC's Order records, for instance, that "Concepcion Lim-Sandico drew Lot R-1 for defendants Carlos Sandico III and Lot R-3 for Conchita S. Lo."
By Order dated 14 November 1996, and again on 12 December 1996, the RTC recorded the parties' progress toward a compromise agreement, the remaining obstacle being the delivery of Amorsolo paintings designated to Enrica and Teodoro.
On 17 September 1998, the final Compromise Agreement was dated; Enrica and Teodoro signed it, but Concepcion and the rest of her children did not, Concepcion continuing to object that division would reduce the value and utility of the properties.
On 19 May 1999, the heirs, represented by Concepcion, executed a Kasunduan with the tenants of the agricultural lands — the 1999 Kasunduan — a voluntary land transfer arrangement allowed by the CARL providing for a 50-50 sharing of the subject property between the heirs and the qualified tenant-beneficiaries.
On 8 June 1999, Conchita issued the latest Special Power of Attorney in favor of Concepcion, appointing her "true and lawful attorney-in-fact" to represent her in all hearings; "[t]o enter into any compromise, settlement or any agreement with respect to the said case in any manner and under such terms and conditions as she may consider appropriate and acceptable"; to enter into any stipulation of facts and make any admission; "[t]o enter into any partition agreement involving the properties subject of the said case of which I have an interest or participation"; and to make, sign, execute, acknowledge and deliver any and all documents in connection therewith.
On 11 January 2000, the RTC issued an Order of Partition, holding that "the defendants are legally bound by their previous acts and admissions and by the previous Orders of this Court" and that the final Compromise Agreement already signed by the plaintiff and plaintiff-in-intervention "is sufficient evidence of the extent and composition of the estate ... and constitutes a valid and proper project for its partition." None of the parties appealed this final order of partition.
On 26 June 2000, Conchita executed a Revocation of the SPA. She filed a copy of the Revocation with the RTC but failed to furnish her agent, Concepcion, a copy thereof. Conchita nonetheless continued to retain the same counsel, Atty. Danilo Tuason, as the other defendants.
On 29 August 2003, various properties remaining undivided, Enrica filed a Motion to Appoint Commissioners to Make Partition.
On 10 September 2003, Atty. Tuason, counsel for the defendants, filed a Manifestation opposing the appointment of commissioners on the ground that the agricultural-land tenants had already agreed to the subdivision.
On 17 October 2003, the RTC granted the Motion to Appoint Commissioners; yet the appointment did not happen, plaintiffs having acquiesced to the defendants' proposed subdivision.
Sometime in 2006, Concepcion, representing herself and the other defendant-heirs — Carlos III, Guillerma, Lily, Pamela and respondent Conchita — executed the 2006 Kasunduan, likewise covering the partition of the subject property and the transfer of half thereof to the eight tenants. Enrica filed a Manifestation dated 18 December 2006 that she and Teodoro would not object so long as they were given their preferred portion.
On 2 March 2007, the RTC issued an Order noting the parties' agreement to undertake a raffle for the distribution of the subject property; the parties filed, through their counsels, the Minutes of the Raffle, the raffle having been conducted on 30 March 2007.
On 13 April 2007, the RTC granted the Motion for Approval of New Agreement and New Subdivision Plan, approving them "subject to the distribution of the property as agreed upon in the raffle done by the parties on March 30, 2007," and ordering Enrica and Teodoro to sign. Conchita did not question the 2 March and 13 April 2007 Orders, even after obtaining a copy of the Order and the Minutes of Raffle in 2008.
On 26 May 2009, Concepcion filed a Motion to Order Register of Deeds to Enter New Titles. Atty. Tuason withdrew as counsel for Conchita in 2009.
On 6 November 2009, Conchita — now through different counsel — opposed the motion on the ground that the 2006 Kasunduan is void for lack of her signature, she having already revoked the agency with her mother, and that the tenant-signatories are not real parties in interest.
On 9 February 2010, the RTC granted Concepcion's motion and ordered the Register of Deeds of Pampanga to enter new titles in the names of the tenants and the heirs, ruling that its 13 April 2007 Order had become final and executory. On 27 August 2010 it denied Conchita's motion for reconsideration.
Conchita assailed the twin Orders before the Court of Appeals by petition for certiorari under Rule 65 (CA-G.R. SP No. 116979). During its pendency, Concepcion and Carlos III died and were substituted by their heirs. Meanwhile, the Register of Deeds of Pampanga cancelled TCT No. 377745-R and issued TCT Nos. 1105, 1107, 1108, 1109, 1111 and 1112 in the names of the tenants.
On 8 November 2012, the CA annulled and set aside the RTC Orders, invalidating the 2006 Kasunduan for lack of the signatures of Enrica, Teodoro and Conchita — the last "now repudiat[ing] her mother's, Concepcion's, signature on her behalf" — and holding it non-compliant with Rule 69. On 11 April 2013 it denied the motion for reconsideration, which only Guillerma had filed.
On 23 June 2021, the Supreme Court rendered its Decision on the Rule 45 petition, granting it and reinstating the RTC Orders.

III. Arguments of the Parties

A. Petitioner (Guillerma S. Silva)

Petitioner asserted that the CA erred in annulling the RTC's 9 February and 27 August 2010 Orders as well as the 13 April 2007 Order approving the 2006 Kasunduan. She argued that while respondent ostensibly assailed only the 2010 Orders directing entry of new titles, she was in truth attacking the 13 April 2007 Order, which had already attained finality, and therefore resorted to the incorrect remedy of an extraordinary writ of certiorari; and that respondent should have impleaded the tenants as indispensable parties.

On the point bearing on the Topic/Subtopic, petitioner's position — which the Court expressly "sustain[ed]" and quoted — was that Conchita's own inaction defeated her: "The new TCTs in favor of the tenants were issued in 2009. Therefore, respondent Conchita could have prevented the cancellation of TCT No. 377745 and the actual distribution of the land had she taken action as early as 2008, when she obtained a copy of the Minutes of the Raffle."

B. Respondent (Conchita S. Lo)

On the point bearing on the Topic/Subtopic, respondent contended that the 2006 Kasunduan is void because it lacked her signature, "since she had already revoked the agency relationship with her mother, Concepcion" — so that Concepcion had no authority to bind her — and that absent the signatures of all the heirs the Kasunduan could not be the basis for the issuance of new titles.

She further contended that the signatory-tenants are not real parties in interest to the partition of a property forming part of the decedent's estate; that the RTC effectively partitioned and distributed the decedent's estate to parties who are neither heirs nor successors-in-interest; and that the 13 April 2007 Order never attained finality, being a void judgment based on a void agreement.

C. Common Ground / Stipulations

The pre-trial stipulations reproduced in the decision are expressly undisputed: the family relationship of the parties, the fact and date of Carlos, Jr.'s intestate death, the composition of the conjugal properties and of the intestate estate, the execution of the 18 November 1976 Extrajudicial Settlement, Concepcion's assumption of actual administration, and the non-distribution of the fruits. It is likewise undisputed on the face of the decision that Conchita filed her Revocation with the RTC but did not furnish Concepcion a copy, and that she retained the defendants' common counsel until 2009.

IV. Issues

A. Main Issue (Topic/Subtopic-Centered)

Tracking the Court's own demarcated sub-argument introduced by the caption "Fourth" — which takes up "the fact that Conchita revoked the SPA she had given to her mother, Concepcion, who therefore no longer had authority to represent her and sign the 2006 Kasunduan on her behalf" — the controlling Topic/Subtopic issue is: whether or not a revocation of a Special Power of Attorney, filed with the court but never communicated to the agent, terminated the agent's authority as against those dealing with her, where the principal thereafter allowed the agency to appear intact by retaining the co-defendants' common counsel, by permitting her mother and that counsel repeatedly to draw lots on her behalf in court-supervised raffles, and by failing for years to assail the orders approving the partition so effected.

B. Secondary Issues

Whether or not the petition for certiorari filed by Conchita is the proper remedy to assail the 9 February and 27 August 2010 Orders of the RTC.
Whether or not the tenants of the subject property should have been impleaded as indispensable parties to Conchita's petition for certiorari.
Whether or not the RTC's 13 April 2007 Order already attained finality.
Whether or not the RTC's 13 April 2007, 9 February 2010 and 27 August 2010 Orders are void for violating Rule 69 — and, corollary thereto, whether the RTC effectively distributed the estate to persons who are not heirs by approving the transfer of half the subject property to the tenants.
Whether or not the 2006 Kasunduan partitioning the subject property is void because it was not signed by all the heirs; and, in the alternative, whether it is merely unenforceable as against Conchita.

C. Ancillary / Incidental Issues

Whether or not the action for partition should now proceed by court-appointed commissioners. The Court resolved this affirmatively, directing the RTC to appoint commissioners under Section 3, Rule 69, observing that "a partition of the estate by agreement of the parties will never happen."

V. Ruling / Disposition (Categorical, Issue-Mapped)

MAIN ISSUE — NO. The unnotified revocation did not defeat the agent's authority as against those dealing with her. Verbatim: "To begin with, Conchita failed to inform her agent, Concepcion, of the fact of revocation. She continued to clothe her mother, Concepcion, with apparent authority to act on her behalf in Civil Case No. Q-89-3137." And, in the alternative and independently: "Conchita has impliedly ratified her mother's assent to the partition on her behalf by failing to assail the RTC's April 13, 2007 Order and the conduct of the raffle for distribution of the property even after she had obtained a copy of the Order and the Minutes of Raffle."

Secondary Issue 1 — NO, certiorari was an improper remedy. "The (1) April 13, 2007, (2) February 9, 2010, and (3) August 27, 2010 Orders of the RTC are final orders decreeing partition," appealable under Section 2, Rule 69 in relation to Section 1, Rule 41.

Secondary Issue 2 — Not indispensable, but NECESSARY. "In short, the tenants are not indispensable parties but, at the least, are necessary parties in the determination of the partition of the subject property."

Secondary Issue 3 — YES. "Ineluctably, the April 13, 2007 Order had attained finality."

Secondary Issue 4 — NO, the Orders are not void; the transfer to the tenant-beneficiaries proceeded "under the aegis of the Department of Agrarian Reform (DAR) pursuant to the law which the heirs cannot ignore or circumvent."

Secondary Issue 5 — NO, the 2006 Kasunduan is not void. "Despite the lack of signatures of specifically three (3) heirs of the decedent, Enrica, Teodoro and respondent Conchita, the 2006 Kasunduan is a valid partition of the subject property which was correctly confirmed by the RTC in its April 13, 2007 Order." As to Conchita specifically, "the 2006 Kasunduan is effective as against Conchita."

Dispositive portion, verbatim:

"WHEREFORE, the Petition for Review on Certiorari is GRANTED. The November 8, 2012 Decision and April 11, 2013 Resolution of the Court of Appeals in CA-G.R. SP No. 116979 are REVERSED and SET ASIDE. The February 9, 2010 and August 27, 2010 Orders of the Regional Trial Court, Branch 82, Quezon City in Civil Case No. Q-89-3137 are REINSTATED. The Regional Trial Court, Branch 82, Quezon City in Civil Case No. Q-89-3137 is DIRECTED to: (1) APPOINT COMMISSIONERS for the partition of Carlos Sandico, Jr.'s estate; and (2) INFORM THE COURT of its compliance within fifteen (15) days of such appointment. No costs.

SO ORDERED."

VI. Ratio Decidendi and Doctrines (Topic-Focused)

A. Ratio Decidendi (Decisive Reasoning)

The substantive portion of the decision proceeds under the ordinal captions "First," "Second," "Third," "Fourth," and "Last."
The "Fourth" sub-argument is the one matching the Topic/Subtopic, and the ratio below tracks it.
Step 1 — The premise the Court had to meet. "The CA makes much of the fact that Conchita revoked the SPA she had given to her mother, Concepcion, who therefore no longer had authority to represent her and sign the 2006 Kasunduan on her behalf."
The Court did not dispute that a revocation had in fact been executed on 26 June 2000 and filed with the RTC.
Step 2 — The defect in the revocation: failure to notify the agent. "To begin with, Conchita failed to inform her agent, Concepcion, of the fact of revocation. She continued to clothe her mother, Concepcion, with apparent authority to act on her behalf in Civil Case No. Q-89-3137."
Step 3 — The reinforcing circumstance of common counsel. "Moreover, Conchita's counsel, Atty. Tuason, who was likewise the counsel of the other defendants in the case, validly represented her in the proceedings before the RTC until his withdrawal as counsel for Conchita in 2009."
Step 4 — The two species of authority, and the codal anchor of the second. "Law and jurisprudence recognize actual authority and apparent authority" — a proposition the Court sourced (footnote 56) to Calubad v. Ricarcen Development Corp., 817 Phil. 509, 527 (2017).
"Apparent authority is based on the principle of estoppel."
The Court then reproduced two Civil Code provisions, and only these two, as the statutory basis:

"Article 1431. Through estoppel an admission or representation is rendered conclusive upon the person making it, and cannot be denied or disproved as against the person relying thereon.

x x x x

Article 1869. Agency 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.

Agency may be oral, unless the law requires a specific form."

Note that the Court quoted both paragraphs of Article 1869, including the second paragraph on the general absence of any required form — the Week 2(c) rule.
Step 5 — Application: knowledge plus silence. "Conchita failed to give her mother notice of the revocation and belatedly repudiated her assent to the 2006 Kasunduan which was signed by her mother on her behalf despite her full and complete knowledge that Civil Case No. Q-89-3137 was ongoing and that the partition of her father's estate's properties was underway. Conchita could not feign ignorance of the action for partition and what it sought, and the consequence of failing to inform her mother that she had revoked the SPA which she had previously given her."
Step 6 — The evidentiary demonstration of the continuing appearance of authority. "The various Orders of the RTC partitioning different properties of the estate clearly show that Concepcion or Atty. Tuason repeatedly and consistently drew the lot on Conchita's behalf in the numerous raffles conducted by the trial court to determine which portion of the property to be divided will go to which heir."
Step 7 — The independent, alternative ground: ratification (Article 1317, par. 2). "The second paragraph of Article 1317 of the Civil Code provides that 'a contract entered into in the name of another by one who has no authority x x x shall be unenforceable, unless it is ratified, expressly or impliedly, by the person on whose behalf it has been executed x x x.' In this case, Conchita has impliedly ratified her mother's assent to the partition on her behalf by failing to assail the RTC's April 13, 2007 Order and the conduct of the raffle for distribution of the property even after she had obtained a copy of the Order and the Minutes of Raffle."
This is the Court's own alternative holding, and it is important: it concedes, arguendo, that the act may have been unauthorized, and holds it nonetheless binding.
Step 8 — The governing principle of construction. "On the whole, we abide by the principle that the binding force of a contract must be recognized as far as it is legally possible to do so. Quando res not valet ut ago, valeat quantum valere patest."
The Court had earlier laid this down in its Civil Code framework as proposition 5 (mutuality of contracts, Article 1308) and proposition 6 (unenforceable contracts ratified by the person in whose name entered into are effective, Article 1317, Article 1403 par. 1, Article 1404).
Step 9 — Reasoning that carried the balance of the disposition (not the topic). Procedurally, the Court held that Rule 69 establishes two phases of partition — first, the order for partition upon a finding of co-ownership.
Second, confirmation of the sketch and subdivision agreed by the parties or reported by commissioners — that the first phase ended with the unappealed 11 January 2000 Order of Partition, that each property of a sizeable estate "may be the subject of separate agreements for its partition," each approved by a final appealable order under the second paragraph of Section 2, Rule 69, and that Conchita therefore used the wrong remedy.
Substantively, it held that the CARL transfer proceeded by compulsion of law.
That under Article 493 a co-owner may alienate his part, so that at most Conchita's 1/16 interest — 1/8 of the 1/2 constituting the decedent's estate, as against Concepcion's 9/16 — could be affected.
And that under Article 494, Article 495 and Article 498 no co-owner may be compelled to remain in co-ownership.

B. Doctrines / Rules / Principles Laid Down

A revocation not communicated to the agent leaves the agent clothed with apparent authority — the doctrinal takeaway for this Topic/Subtopic. Verbatim:

"To begin with, Conchita failed to inform her agent, Concepcion, of the fact of revocation. She continued to clothe her mother, Concepcion, with apparent authority to act on her behalf in Civil Case No. Q-89-3137."
Actual and apparent authority; the codal basis of the latter (Article 1431; Article 1869). Verbatim: "Law and jurisprudence recognize actual authority and apparent authority. Apparent authority is based on the principle of estoppel," followed by the Court's reproduction of Article 1431 ("Through estoppel an admission or representation is rendered conclusive upon the person making it, and cannot be denied or disproved as against the person relying thereon") and of both paragraphs of Article 1869 ("Agency 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. / Agency may be oral, unless the law requires a specific form.").
The principal's knowledge and silence are what estop her. Verbatim: "Conchita could not feign ignorance of the action for partition and what it sought, and the consequence of failing to inform her mother that she had revoked the SPA which she had previously given her."
Implied ratification of an unauthorized contract (Article 1317, par. 2). Verbatim: "Conchita has impliedly ratified her mother's assent to the partition on her behalf by failing to assail the RTC's April 13, 2007 Order and the conduct of the raffle for distribution of the property even after she had obtained a copy of the Order and the Minutes of Raffle."
Preference for validity. "[T]he binding force of a contract must be recognized as far as it is legally possible to do so. Quando res not valet ut ago, valeat quantum valere patest" (Article 1308).
Two phases of judicial partition (Sections 2 and 3, Rule 69). "[F]irst, the trial court, after determining that a co-ownership in fact exists and that partition is proper, issues an order for partition; and, second, the trial court promulgates a decision confirming the sketch and subdivision of the properties submitted by the parties (if the parties reach an agreement) or by the appointed commissioners (if the parties fail to agree)." In either case of the first phase, "the order is a final one, and may be appealed by any party aggrieved thereby" (citing Heirs of Marasigan v. Marasigan and Maglucot-aw v. Maglucot).
Alienation by a co-owner (Article 493; cf. Article 494, Article 495, Article 498). A co-owner has full ownership of his part and may alienate it, "but the effect of the alienation or the mortgage, with respect to the co-owners, shall be limited to the portion which may be allotted to him in the division upon the termination of the co-ownership" (applying Tabasondra v. Spouses Constantino and Heirs of the Late Gerry Ecarma v. Court of Appeals).
Tenancy survives alienation (Section 9, R.A. No. 1199; Section 10, R.A. No. 3844; Reyes v. Mauricio), so that CARL beneficiaries who received titles are at least necessary parties to any suit annulling the partition.

C. Distinctions / Limitations / Qualifications

This is an ANALOGOUS case, and the distinction matters for recitation. The Court reached the result that Article 1873 would compel — an authority whose revocation was not made known continues in force as to those who deal on the faith of it — but it did not cite Article 1873, and it did not cite Article 1911. Its stated bases are Article 1431, Article 1869 and Article 1317, paragraph 2. To recite Silva v. Lo as "the Article 1873 case" would attribute to the Court a provision it never invoked. The correct formulation is that the Court resolved the Week 2(b) problem through estoppel and ratification rather than through the notice rule of Article 1873.
The Court expressly declined to rule on the validity of the agent's signature. "Even without going into the validity of Concepcion signing the 2006 Kasunduan on Conchita's behalf, the appellate court could not void the sale and transfer of half of the subject property to its qualified beneficiaries under a voluntary transfer arrangement provided in the CARL." The apparent-authority passage is thus one of several independent grounds, not the sole ratio of the disposition.
The persons who relied were not classic "third persons" transacting with a stranger's agent. They were the co-heirs, the trial court, and the tenant-beneficiaries under a statutory transfer scheme. The reliance interest the Court protected was accordingly institutional as much as contractual — the integrity of years of court-supervised raffles in which "Concepcion or Atty. Tuason repeatedly and consistently drew the lot on Conchita's behalf."
The revocation was not concealed from everyone. Conchita did file a copy with the RTC. What she omitted was notice to the agent. That the Court still found apparent authority shows that, in its view, filing with the court did not operate as notice to those dealing with the agent — a point worth pressing if the professor asks what Article 1873 would have required.
Ratification is an independent and sufficient ground. Even a student who resists the apparent-authority analysis must contend with Step 7: under Article 1317, paragraph 2, the act of an unauthorized representative is unenforceable, not void, and Conchita's years of silence after obtaining the Order and Minutes of Raffle cured it.
The quantitative limit on what was at stake. Conchita's interest was 1/8 of 1/2, or 1/16 of the entire property, as against Concepcion's 9/16; under Article 493 the alienation could in no event have prejudiced more than her own share.

D. Topic/Subtopic Integration (Mandatory)

The classification is ANALOGOUS.
Silva v. Lo is the Week 2(b) case not because it construes Article 1873 — it does not mention it — but because it presents that article's exact fact pattern and resolves it by the same policy through neighbouring provisions, and this is precisely what makes it useful for recitation.
Week 2(b) asks how the perfection of an agency operates outward, toward persons who did not participate in its constitution.
The Court's answer here is that the outward face of the agency is the principal's responsibility to maintain and, equally, to dismantle: a principal who creates an authority and then withdraws it in a manner invisible to those dealing with the agent "continue[s] to clothe" the agent with it, because "[a]pparent authority is based on the principle of estoppel" under Article 1431, and because under Article 1869 agency may be implied "from his silence or lack of action, or his failure to repudiate the agency."
That is the same allocation of risk Article 1873 makes explicit when it provides that the power "shall continue to be in full force until the notice is rescinded in the same manner in which it was given" — and the professor is entitled to be told that the Court got there by estoppel rather than by that article.
This is an inference drawn for study purposes and is labelled as such: the Court itself never equated its holding with Article 1873, and nothing above should be recited as the Court's own statement of that provision.
What the Court did hold, and what may be quoted without qualification, is that the failure to notify the agent left the agency apparently intact, and that in any event the principal's prolonged silence ratified the act under Article 1317, paragraph 2.

VII. Separate Opinions

None. The Decision was penned by Hernando, J., with Inting, Delos Santos, and J. Lopez, JJ., concurring; Leonen, J., was on wellness leave. No separate concurring or dissenting opinion appears in the record.

Cited Laws & Provisions

Every statute, rule, and issuance the decision turns on — the text as written, and the work it does in this case.

Civil Code

Article 1921, Civil Code

Civil Code of the Philippines (R.A. No. 386), Book IV (Obligations and Contracts), Title X (Agency), Chapter 4 (Modes of Extinguishment of Agency)

If the agency has been entrusted for the purpose of contracting with specified persons, its revocation shall not prejudice the latter if they were not given notice thereof. (1734)

Why it is cited here

The rule protecting the specified third person: "If the agency has been entrusted for the purpose of contracting with specified persons, its revocation shall not prejudice the latter if they were not given notice thereof."

Revocation is effective between principal and agent when the agent learns of it — but as to the outside world it takes effect only on notice. Where the agency was aimed at named persons, those persons must be told; silence leaves the authority intact so far as they are concerned.

The reason is allocation of risk. The principal chose the agent, knows of the revocation first, and can give notice cheaply. The third person can do nothing at all. So acts done before notice remain valid and bind the principal.

Civil Code

Article 1922, Civil Code

Civil Code of the Philippines (R.A. No. 386), Book IV (Obligations and Contracts), Title X (Agency), Chapter 4 (Modes of Extinguishment of Agency)

If the agent had general powers, revocation of the agency does not prejudice third persons who acted in good faith and without knowledge of the revocation. Notice of the revocation in a newspaper of general circulation is a sufficient warning to third persons. (n)

Why it is cited here

The companion rule for the general case: "If the agent had general powers, revocation of the agency does not prejudice third persons who acted in good faith and without knowledge of the revocation. Notice of the revocation in a newspaper of general circulation is a sufficient warning to third persons."

Read the two articles as a pair and the scheme is symmetrical. Where the agency targets named persons, they get individual notice; where the powers are general and the world at large may deal with the agent, publication suffices. In each case the principal must do the thing that would reasonably reach the people at risk.

Note the good-faith qualifier here that Article 1921 does not carry. A third person who actually knew of the revocation is unprotected however it was published, because the point of notice is knowledge and he already had it.

Civil Code

Article 1920, Civil Code

Civil Code of the Philippines (R.A. No. 386), Book IV (Obligations and Contracts), Title X (Agency), Chapter 4 (Modes of Extinguishment of Agency)

The principal may revoke the agency at will, and compel the agent to return the document evidencing the agency. Such revocation may be express or implied. (1733a)

Why it is cited here

The power being exercised: "The principal may revoke the agency at will, and compel the agent to return the document evidencing the agency."

It is the necessary background to the notice rules. The principal's right to revoke is not in doubt and needs no cause — so the questions the case actually raises are all about timing and communication, not entitlement. Articles 1921 and 1922 do not restrict the right; they fix the moment it becomes effective against people who are not parties to it.

Civil Code

Article 1431, Civil Code

Civil Code of the Philippines (R.A. No. 386), Book IV (Obligations and Contracts), Title IV (Estoppel (N))

Through estoppel an admission or representation is rendered conclusive upon the person making it, and cannot be denied or disproved as against the person relying thereon.

Why it is cited here

The second ground, independent of notice: "Through estoppel an admission or representation is rendered conclusive upon the person making it, and cannot be denied or disproved as against the person relying thereon."

A principal who accepts the benefits of the agent's act, or otherwise acquiesces in it, has ratified it and cannot afterwards assail it. This closes off the argument that would otherwise survive proper notice — that the act, though binding on third persons, was unauthorised as between principal and agent.

The practical rule worth carrying: on learning of an act you did not authorise, taking the benefit of it is a decision. A principal who wants to disown a transaction must not first pocket its proceeds.

Civil Code

Article 1869, Civil Code

Civil Code of the Philippines (R.A. No. 386), Book IV (Obligations and Contracts), Title X (Agency), Chapter 1 (Nature, Form and Kinds of Agency)

Agency 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.

Agency may be oral, unless the law requires a specific form. (1710a)

Why it is cited here

The implied-agency clause, used to sustain apparent authority.

"Agency 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."

Silva had given her mother a special power of attorney, then revoked it without telling her, and afterwards attacked the family partition her mother signed on her behalf.

Note what the Court did not do: it decided the case "without citing Article 1873 or Article 1911 at all" — the provisions normally invoked for notice of revocation and for apparent authority.

It anchored the holding instead on estoppel under Article 1431, this article's implied-agency clause, and ratification under Article 1317.

That combination is worth noticing as a matter of technique. Where a revocation is unnotified, the principal's own silence toward the counterparties keeps the appearance of authority alive under this article, and estoppel then makes that appearance conclusive.

Civil Code

Article 1317, Civil Code

Civil Code of the Philippines (R.A. No. 386), Book IV (Obligations and Contracts), Title II (Contracts), Chapter 1 (General Provisions)

No one may contract in the name of another without being authorized by the latter, or unless he has by law a right to represent him.

A contract entered into in the name of another by one who has no authority or legal representation, or who has acted beyond his powers, shall be unenforceable, unless it is ratified, expressly or impliedly, by the person on whose behalf it has been executed, before it is revoked by the other contracting party. (1259a)

Why it is cited here

Ratification, and the deadline built into it.

"No one may contract in the name of another without being authorized by the latter … A contract entered into in the name of another by one who has no authority or legal representation, or who has acted beyond his powers, shall be unenforceable, unless it is ratified, expressly or impliedly, by the person on whose behalf it has been executed, before it is revoked by the other contracting party."

Read the consequence precisely: an unauthorised contract is unenforceable, not void. It sits in suspense, awaiting ratification.

Silva's own conduct after the partition supplied that ratification impliedly, which is what defeated her attack on the settlement.

The clause "before it is revoked by the other contracting party" is the limit students miss. The counterparty may withdraw while the contract is unratified; once he does, no later ratification can revive it.

Related notes: Article 1308 · Article 1317 · Article 1403 · Article 1404 · Article 1431 · Article 1869 · Article 1873 · Article 1900 · Article 1911 · Article 1920 · Article 1921 · Article 1922 · Article 493 · Article 494 · Rule 69 · Apparent Authority · Agency by Estoppel · Ratification · Revocation of Agency · Gonzales-Saldana v. Sps. Niamatali · Litonjua v. Eternit (Week 2)

Source: Silva v. Lo, G.R. No. 206667, 23 June 2021

Cited laws & provisions

Article 1921, Civil Code

Civil Code

Civil Code of the Philippines (R.A. No. 386), Book IV (Obligations and Contracts), Title X (Agency), Chapter 4 (Modes of Extinguishment of Agency)

If the agency has been entrusted for the purpose of contracting with specified persons, its revocation shall not prejudice the latter if they were not given notice thereof. (1734)

Why it is cited here

Full entry below ↓

Article 1922, Civil Code

Civil Code

Civil Code of the Philippines (R.A. No. 386), Book IV (Obligations and Contracts), Title X (Agency), Chapter 4 (Modes of Extinguishment of Agency)

Why it is cited here

Full entry below ↓

Article 1920, Civil Code

Civil Code

Civil Code of the Philippines (R.A. No. 386), Book IV (Obligations and Contracts), Title X (Agency), Chapter 4 (Modes of Extinguishment of Agency)

The principal may revoke the agency at will, and compel the agent to return the document evidencing the agency. Such revocation may be express or implied. (1733a)

Why it is cited here

The power being exercised: "The principal may revoke the agency at will, and compel the agent to return the document evidencing the agency."

Full entry below ↓

Article 1431, Civil Code

Civil Code

Civil Code of the Philippines (R.A. No. 386), Book IV (Obligations and Contracts), Title IV (Estoppel (N))

Through estoppel an admission or representation is rendered conclusive upon the person making it, and cannot be denied or disproved as against the person relying thereon.

Why it is cited here

Full entry below ↓

Article 1869, Civil Code

Civil Code

Civil Code of the Philippines (R.A. No. 386), Book IV (Obligations and Contracts), Title X (Agency), Chapter 1 (Nature, Form and Kinds of Agency)

Agency may be oral, unless the law requires a specific form. (1710a)

Why it is cited here

The implied-agency clause, used to sustain apparent authority.

Silva had given her mother a special power of attorney, then revoked it without telling her, and afterwards attacked the family partition her mother signed on her behalf.

It anchored the holding instead on estoppel under Article 1431, this article's implied-agency clause, and ratification under Article 1317.

Full entry below ↓

Article 1317, Civil Code

Civil Code

Civil Code of the Philippines (R.A. No. 386), Book IV (Obligations and Contracts), Title II (Contracts), Chapter 1 (General Provisions)

No one may contract in the name of another without being authorized by the latter, or unless he has by law a right to represent him.

Why it is cited here

Ratification, and the deadline built into it.

Read the consequence precisely: an unauthorised contract is unenforceable, not void. It sits in suspense, awaiting ratification.

Silva's own conduct after the partition supplied that ratification impliedly, which is what defeated her attack on the settlement.

Full entry below ↓

Facts

Carlos Sandico, Jr. died intestate on May 20, 1975, survived by his spouse Concepcion Lim-Sandico and several compulsory heirs, among them petitioner Guillerma Sandico-Silva and respondent Conchita S. Lo.
Intestate proceedings for the settlement of his estate followed and remained pending for decades. (A 1976 extrajudicial settlement and a 1988 memorandum of agreement were both left unimplemented, so in 1989 one heir, Ma. Enrica Sandico-Pascual, sued the rest for partition — Civil Case No. Q-89-3137 before the RTC of Quezon City, Branch 82.)
Conchita (the principal), who was abroad, had earlier executed a Special Power of Attorney (SPA) in favour of her mother, Concepcion (the agent), authorising her to represent Conchita in matters concerning the estate. (The latest of these, dated 8 June 1999, empowered Concepcion "[t]o enter into any compromise, settlement or any agreement with respect to the said case" and "[t]o enter into any partition agreement involving the properties subject of the said case" — the very powers later disputed.)
Concepcion acted under that SPA in the settlement proceedings over a long period. (When the trial court divided the properties by raffle, Concepcion drew lots on her daughter's behalf — the order recording that she "drew ... Lot R-3 for Conchita S. Lo.")
Conchita later executed a document purportedly revoking the SPA on June 26, 2000, but she did not effectively notify Concepcion of the revocation. (She filed a copy of the revocation with the trial court but never furnished her agent one, and she kept the same counsel as the rest of the defendant-heirs.)
In 2006, the heirs executed a Kasunduan — a compromise agreement partitioning the estate. (It covered a 103,024-square-metre agricultural tract at Talimundok, San Agustin, Magalang, Pampanga under TCT No. 377745-R, splitting it evenly with eight tenant-beneficiaries under the voluntary land transfer scheme — following a similar Kasunduan the heirs had signed with the tenants in 1999.)
Conchita's own signature did not appear on it; her interest was represented by Concepcion acting under the SPA.
Conchita subsequently attacked the Kasunduan, arguing that it could not bind her because she had never signed it and because the SPA had already been revoked when it was executed. (She raised it only on 6 November 2009, having let the trial court's 2 March and 13 April 2007 orders approving the new agreement and subdivision plan pass unquestioned even after obtaining copies in 2008.)
Regional Trial Court — partition ordered carried out. On 9 February 2010 the RTC ordered the Register of Deeds of Pampanga to enter new titles in the names of the tenants and the heirs, its earlier 13 April 2007 order having become final; it denied reconsideration on 27 August 2010.
Court of Appeals — orders annulled. On 8 November 2012 the Court of Appeals set those orders aside on certiorari, invalidating the 2006 Kasunduan for want of the signatures of Enrica, Teodoro and Conchita, the last "now repudiat[ing] her mother's, Concepcion's, signature on her behalf."

Issue

Whether the Kasunduan binds Conchita notwithstanding (a) the absence of her signature and (b) her earlier, uncommunicated revocation of the SPA.

Ruling

Ratio

1. The Agent's Signature Is the Principal's Signature

The absence of Conchita's personal signature did not invalidate the agreement.
She had granted her mother a special power of attorney, and an act performed by the agent within the scope of that authority produces the same effect as though the principal had performed it herself.
Concepcion signed for Conchita's account, and Conchita was bound.

2. Revocation Binds the Agent Only from Notice

Conchita's principal argument — that the SPA had already been revoked — failed on the facts and on the law.
The revocation was never effectively communicated to Concepcion.
Revocation of an agency operates as to the agent only from the time it is made known to him.
Until then, the agent's acts within the granted authority remain valid and bind the principal.
A principal cannot secretly withdraw authority and then repudiate what her agent, still believing herself authorised, has done in good faith.
(The rule is stricter still in favour of third persons, who under Article 1922 are unaffected by a revocation of which they had no notice.)

3. Ratification by Conduct

Independently of the SPA, the Court found that the heirs — Conchita included — had ratified the Kasunduan through their acts in the course of the partition proceedings.
Ratification may be express or implied, and is implied from conduct inconsistent with repudiation, such as accepting the benefits of the transaction or participating in its implementation.
Having so acted, Conchita was estopped from disowning the agreement.

4. Policy Favouring Settlement

The Court also weighed the protracted history of the intestate proceedings.
Compromise agreements that fairly partition an estate are favoured, and a party will not be permitted to unsettle a long-implemented family settlement on a technical objection she herself helped render moot.

Doctrine

Effect of the agent's act. Within the scope of the authority conferred, the agent's execution of a document is, in law, the principal's own execution of it; the principal's separate signature is unnecessary.
Revocation requires communication. As against the agent, revocation is effective only upon notice; acts performed before notice remain valid. As against third persons, Article 1922 protects those who dealt with the agent in good faith and without notice of the revocation.
Ratification. A principal who accepts the benefits of, or acquiesces in, an act done for her is deemed to have ratified it — express or implied — and may not thereafter impugn it.

Full Digest — Recitation Format

Full-length digest in the format required by the course digest prompt.

Classification: ANALOGOUS · Ponente: Hernando, J. (Third Division) · G.R. No. 206667, 23 June 2021

TOPIC/SUBTOPIC FOCUS: Week 2 — Formalities of Agency: (b) Perfection of the contract of agency as it affects third persons (Article 1873; cf. Article 1911).

I. Gist and Central Doctrine

II. Chronological Narration of Material Facts and Procedural Events

On 20 May 1975, Carlos Sandico, Jr. died intestate, leaving a sizeable estate to his compulsory heirs: his surviving spouse Concepcion Lim-Sandico, and their children Ma. Enrica Sandico-Pascual, Carlos L. Sandico III, petitioner Guillerma Sandico-Silva, Lily Sandico-Brown, Pamela S. Zapanta, respondent Conchita S. Lo, and Teodoro L. Sandico.
Sometime in 1976 — the stipulation at pre-trial fixes the instrument's date at 18 November 1976 — the heirs executed an Extrajudicial Settlement of Estate providing that all properties of the decedent shall be owned in common, pro indiviso, by his heirs.
In September 1988, the heirs executed a Memorandum of Agreement for the physical division of the estate. Neither this nor the 1976 settlement was ever implemented, and the heirs remained pro indiviso co-owners.
On 3 August 1989, Enrica filed Civil Case No. Q-89-3137 before the RTC, Branch 82, Quezon City, impleading all the other heirs as defendants. Teodoro later withdrew as defendant and joined suit as plaintiff-in-intervention.
Opposing physical division, the defendants asserted Concepcion's usufructuary rights over the estate's real properties and a diminished value and use of the properties if divided. Given the unanimity of their defense, Conchita and two other heirs residing abroad, Lily and Pamela, executed Special Powers of Attorney in favor of their mother Concepcion and their sister Guillerma, respectively.
At pre-trial the parties stipulated, among others, that the case is between members of the same family; that Carlos, Jr. died intestate on 20 May 1975 leaving a legitimate spouse and seven legitimate children as forced heirs; that one half of the conjugal properties constituted his intestate estate; that the parties executed the Extrajudicial Settlement of Estate dated 18 November 1976; and that the fruits or proceeds of the estate were not distributed among the co-heirs because of an alleged grant of usufruct in the mother's favor, whose existence and validity Enrica contested.
On 1 September 1994, the Registry of Deeds of Pampanga issued TCT No. 377745-R over the subject property, a 103,024-square-meter tract of agricultural land at Talimundok, San Agustin, Magalang, Pampanga, in the names of Concepcion and Carlos III, subject to encumbrances listing the other compulsory heirs, and noting Enrica's lis pendens.
In the course of trial the heirs agreed on the manner of dividing each property by raffle conducted by the trial court, drawing lots for an aliquot of each property with Concepcion drawing first. For heirs who failed to attend, their counsel or their appointed attorney-in-fact — either Concepcion or Guillerma, in the case of Conchita, Lily and Pamela — drew the lot on their behalf. The RTC's Order records, for instance, that "Concepcion Lim-Sandico drew Lot R-1 for defendants Carlos Sandico III and Lot R-3 for Conchita S. Lo."
By Order dated 14 November 1996, and again on 12 December 1996, the RTC recorded the parties' progress toward a compromise agreement, the remaining obstacle being the delivery of Amorsolo paintings designated to Enrica and Teodoro.
On 17 September 1998, the final Compromise Agreement was dated; Enrica and Teodoro signed it, but Concepcion and the rest of her children did not, Concepcion continuing to object that division would reduce the value and utility of the properties.
On 19 May 1999, the heirs, represented by Concepcion, executed a Kasunduan with the tenants of the agricultural lands — the 1999 Kasunduan — a voluntary land transfer arrangement allowed by the CARL providing for a 50-50 sharing of the subject property between the heirs and the qualified tenant-beneficiaries.
On 8 June 1999, Conchita issued the latest Special Power of Attorney in favor of Concepcion, appointing her "true and lawful attorney-in-fact" to represent her in all hearings; "[t]o enter into any compromise, settlement or any agreement with respect to the said case in any manner and under such terms and conditions as she may consider appropriate and acceptable"; to enter into any stipulation of facts and make any admission; "[t]o enter into any partition agreement involving the properties subject of the said case of which I have an interest or participation"; and to make, sign, execute, acknowledge and deliver any and all documents in connection therewith.
On 11 January 2000, the RTC issued an Order of Partition, holding that "the defendants are legally bound by their previous acts and admissions and by the previous Orders of this Court" and that the final Compromise Agreement already signed by the plaintiff and plaintiff-in-intervention "is sufficient evidence of the extent and composition of the estate ... and constitutes a valid and proper project for its partition." None of the parties appealed this final order of partition.
On 26 June 2000, Conchita executed a Revocation of the SPA. She filed a copy of the Revocation with the RTC but failed to furnish her agent, Concepcion, a copy thereof. Conchita nonetheless continued to retain the same counsel, Atty. Danilo Tuason, as the other defendants.
On 29 August 2003, various properties remaining undivided, Enrica filed a Motion to Appoint Commissioners to Make Partition.
On 10 September 2003, Atty. Tuason, counsel for the defendants, filed a Manifestation opposing the appointment of commissioners on the ground that the agricultural-land tenants had already agreed to the subdivision.
On 17 October 2003, the RTC granted the Motion to Appoint Commissioners; yet the appointment did not happen, plaintiffs having acquiesced to the defendants' proposed subdivision.
Sometime in 2006, Concepcion, representing herself and the other defendant-heirs — Carlos III, Guillerma, Lily, Pamela and respondent Conchita — executed the 2006 Kasunduan, likewise covering the partition of the subject property and the transfer of half thereof to the eight tenants. Enrica filed a Manifestation dated 18 December 2006 that she and Teodoro would not object so long as they were given their preferred portion.
On 2 March 2007, the RTC issued an Order noting the parties' agreement to undertake a raffle for the distribution of the subject property; the parties filed, through their counsels, the Minutes of the Raffle, the raffle having been conducted on 30 March 2007.
On 13 April 2007, the RTC granted the Motion for Approval of New Agreement and New Subdivision Plan, approving them "subject to the distribution of the property as agreed upon in the raffle done by the parties on March 30, 2007," and ordering Enrica and Teodoro to sign. Conchita did not question the 2 March and 13 April 2007 Orders, even after obtaining a copy of the Order and the Minutes of Raffle in 2008.
On 26 May 2009, Concepcion filed a Motion to Order Register of Deeds to Enter New Titles. Atty. Tuason withdrew as counsel for Conchita in 2009.
On 6 November 2009, Conchita — now through different counsel — opposed the motion on the ground that the 2006 Kasunduan is void for lack of her signature, she having already revoked the agency with her mother, and that the tenant-signatories are not real parties in interest.
On 9 February 2010, the RTC granted Concepcion's motion and ordered the Register of Deeds of Pampanga to enter new titles in the names of the tenants and the heirs, ruling that its 13 April 2007 Order had become final and executory. On 27 August 2010 it denied Conchita's motion for reconsideration.
Conchita assailed the twin Orders before the Court of Appeals by petition for certiorari under Rule 65 (CA-G.R. SP No. 116979). During its pendency, Concepcion and Carlos III died and were substituted by their heirs. Meanwhile, the Register of Deeds of Pampanga cancelled TCT No. 377745-R and issued TCT Nos. 1105, 1107, 1108, 1109, 1111 and 1112 in the names of the tenants.
On 8 November 2012, the CA annulled and set aside the RTC Orders, invalidating the 2006 Kasunduan for lack of the signatures of Enrica, Teodoro and Conchita — the last "now repudiat[ing] her mother's, Concepcion's, signature on her behalf" — and holding it non-compliant with Rule 69. On 11 April 2013 it denied the motion for reconsideration, which only Guillerma had filed.
On 23 June 2021, the Supreme Court rendered its Decision on the Rule 45 petition, granting it and reinstating the RTC Orders.

III. Arguments of the Parties

A. Petitioner (Guillerma S. Silva)

B. Respondent (Conchita S. Lo)

C. Common Ground / Stipulations

IV. Issues

A. Main Issue (Topic/Subtopic-Centered)

B. Secondary Issues

Whether or not the petition for certiorari filed by Conchita is the proper remedy to assail the 9 February and 27 August 2010 Orders of the RTC.
Whether or not the tenants of the subject property should have been impleaded as indispensable parties to Conchita's petition for certiorari.
Whether or not the RTC's 13 April 2007 Order already attained finality.
Whether or not the RTC's 13 April 2007, 9 February 2010 and 27 August 2010 Orders are void for violating Rule 69 — and, corollary thereto, whether the RTC effectively distributed the estate to persons who are not heirs by approving the transfer of half the subject property to the tenants.
Whether or not the 2006 Kasunduan partitioning the subject property is void because it was not signed by all the heirs; and, in the alternative, whether it is merely unenforceable as against Conchita.

C. Ancillary / Incidental Issues

V. Ruling / Disposition (Categorical, Issue-Mapped)

Secondary Issue 3 — YES. "Ineluctably, the April 13, 2007 Order had attained finality."

Dispositive portion, verbatim:

"WHEREFORE, the Petition for Review on Certiorari is GRANTED. The November 8, 2012 Decision and April 11, 2013 Resolution of the Court of Appeals in CA-G.R. SP No. 116979 are REVERSED and SET ASIDE. The February 9, 2010 and August 27, 2010 Orders of the Regional Trial Court, Branch 82, Quezon City in Civil Case No. Q-89-3137 are REINSTATED. The Regional Trial Court, Branch 82, Quezon City in Civil Case No. Q-89-3137 is DIRECTED to: (1) APPOINT COMMISSIONERS for the partition of Carlos Sandico, Jr.'s estate; and (2) INFORM THE COURT of its compliance within fifteen (15) days of such appointment. No costs.

SO ORDERED."

VI. Ratio Decidendi and Doctrines (Topic-Focused)

A. Ratio Decidendi (Decisive Reasoning)

The substantive portion of the decision proceeds under the ordinal captions "First," "Second," "Third," "Fourth," and "Last."
The "Fourth" sub-argument is the one matching the Topic/Subtopic, and the ratio below tracks it.
Step 1 — The premise the Court had to meet. "The CA makes much of the fact that Conchita revoked the SPA she had given to her mother, Concepcion, who therefore no longer had authority to represent her and sign the 2006 Kasunduan on her behalf."
The Court did not dispute that a revocation had in fact been executed on 26 June 2000 and filed with the RTC.
Step 2 — The defect in the revocation: failure to notify the agent. "To begin with, Conchita failed to inform her agent, Concepcion, of the fact of revocation. She continued to clothe her mother, Concepcion, with apparent authority to act on her behalf in Civil Case No. Q-89-3137."
Step 3 — The reinforcing circumstance of common counsel. "Moreover, Conchita's counsel, Atty. Tuason, who was likewise the counsel of the other defendants in the case, validly represented her in the proceedings before the RTC until his withdrawal as counsel for Conchita in 2009."
Step 4 — The two species of authority, and the codal anchor of the second. "Law and jurisprudence recognize actual authority and apparent authority" — a proposition the Court sourced (footnote 56) to Calubad v. Ricarcen Development Corp., 817 Phil. 509, 527 (2017).
"Apparent authority is based on the principle of estoppel."
The Court then reproduced two Civil Code provisions, and only these two, as the statutory basis:

"Article 1431. Through estoppel an admission or representation is rendered conclusive upon the person making it, and cannot be denied or disproved as against the person relying thereon.

x x x x

Article 1869. Agency 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.

Agency may be oral, unless the law requires a specific form."

Note that the Court quoted both paragraphs of Article 1869, including the second paragraph on the general absence of any required form — the Week 2(c) rule.
Step 5 — Application: knowledge plus silence. "Conchita failed to give her mother notice of the revocation and belatedly repudiated her assent to the 2006 Kasunduan which was signed by her mother on her behalf despite her full and complete knowledge that Civil Case No. Q-89-3137 was ongoing and that the partition of her father's estate's properties was underway. Conchita could not feign ignorance of the action for partition and what it sought, and the consequence of failing to inform her mother that she had revoked the SPA which she had previously given her."
Step 6 — The evidentiary demonstration of the continuing appearance of authority. "The various Orders of the RTC partitioning different properties of the estate clearly show that Concepcion or Atty. Tuason repeatedly and consistently drew the lot on Conchita's behalf in the numerous raffles conducted by the trial court to determine which portion of the property to be divided will go to which heir."
Step 7 — The independent, alternative ground: ratification (Article 1317, par. 2). "The second paragraph of Article 1317 of the Civil Code provides that 'a contract entered into in the name of another by one who has no authority x x x shall be unenforceable, unless it is ratified, expressly or impliedly, by the person on whose behalf it has been executed x x x.' In this case, Conchita has impliedly ratified her mother's assent to the partition on her behalf by failing to assail the RTC's April 13, 2007 Order and the conduct of the raffle for distribution of the property even after she had obtained a copy of the Order and the Minutes of Raffle."
This is the Court's own alternative holding, and it is important: it concedes, arguendo, that the act may have been unauthorized, and holds it nonetheless binding.
Step 8 — The governing principle of construction. "On the whole, we abide by the principle that the binding force of a contract must be recognized as far as it is legally possible to do so. Quando res not valet ut ago, valeat quantum valere patest."
The Court had earlier laid this down in its Civil Code framework as proposition 5 (mutuality of contracts, Article 1308) and proposition 6 (unenforceable contracts ratified by the person in whose name entered into are effective, Article 1317, Article 1403 par. 1, Article 1404).
Step 9 — Reasoning that carried the balance of the disposition (not the topic). Procedurally, the Court held that Rule 69 establishes two phases of partition — first, the order for partition upon a finding of co-ownership.
Second, confirmation of the sketch and subdivision agreed by the parties or reported by commissioners — that the first phase ended with the unappealed 11 January 2000 Order of Partition, that each property of a sizeable estate "may be the subject of separate agreements for its partition," each approved by a final appealable order under the second paragraph of Section 2, Rule 69, and that Conchita therefore used the wrong remedy.
Substantively, it held that the CARL transfer proceeded by compulsion of law.
That under Article 493 a co-owner may alienate his part, so that at most Conchita's 1/16 interest — 1/8 of the 1/2 constituting the decedent's estate, as against Concepcion's 9/16 — could be affected.
And that under Article 494, Article 495 and Article 498 no co-owner may be compelled to remain in co-ownership.

B. Doctrines / Rules / Principles Laid Down

A revocation not communicated to the agent leaves the agent clothed with apparent authority — the doctrinal takeaway for this Topic/Subtopic. Verbatim:

"To begin with, Conchita failed to inform her agent, Concepcion, of the fact of revocation. She continued to clothe her mother, Concepcion, with apparent authority to act on her behalf in Civil Case No. Q-89-3137."
Actual and apparent authority; the codal basis of the latter (Article 1431; Article 1869). Verbatim: "Law and jurisprudence recognize actual authority and apparent authority. Apparent authority is based on the principle of estoppel," followed by the Court's reproduction of Article 1431 ("Through estoppel an admission or representation is rendered conclusive upon the person making it, and cannot be denied or disproved as against the person relying thereon") and of both paragraphs of Article 1869 ("Agency 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. / Agency may be oral, unless the law requires a specific form.").
The principal's knowledge and silence are what estop her. Verbatim: "Conchita could not feign ignorance of the action for partition and what it sought, and the consequence of failing to inform her mother that she had revoked the SPA which she had previously given her."
Implied ratification of an unauthorized contract (Article 1317, par. 2). Verbatim: "Conchita has impliedly ratified her mother's assent to the partition on her behalf by failing to assail the RTC's April 13, 2007 Order and the conduct of the raffle for distribution of the property even after she had obtained a copy of the Order and the Minutes of Raffle."
Preference for validity. "[T]he binding force of a contract must be recognized as far as it is legally possible to do so. Quando res not valet ut ago, valeat quantum valere patest" (Article 1308).
Two phases of judicial partition (Sections 2 and 3, Rule 69). "[F]irst, the trial court, after determining that a co-ownership in fact exists and that partition is proper, issues an order for partition; and, second, the trial court promulgates a decision confirming the sketch and subdivision of the properties submitted by the parties (if the parties reach an agreement) or by the appointed commissioners (if the parties fail to agree)." In either case of the first phase, "the order is a final one, and may be appealed by any party aggrieved thereby" (citing Heirs of Marasigan v. Marasigan and Maglucot-aw v. Maglucot).
Alienation by a co-owner (Article 493; cf. Article 494, Article 495, Article 498). A co-owner has full ownership of his part and may alienate it, "but the effect of the alienation or the mortgage, with respect to the co-owners, shall be limited to the portion which may be allotted to him in the division upon the termination of the co-ownership" (applying Tabasondra v. Spouses Constantino and Heirs of the Late Gerry Ecarma v. Court of Appeals).
Tenancy survives alienation (Section 9, R.A. No. 1199; Section 10, R.A. No. 3844; Reyes v. Mauricio), so that CARL beneficiaries who received titles are at least necessary parties to any suit annulling the partition.

C. Distinctions / Limitations / Qualifications

This is an ANALOGOUS case, and the distinction matters for recitation. The Court reached the result that Article 1873 would compel — an authority whose revocation was not made known continues in force as to those who deal on the faith of it — but it did not cite Article 1873, and it did not cite Article 1911. Its stated bases are Article 1431, Article 1869 and Article 1317, paragraph 2. To recite Silva v. Lo as "the Article 1873 case" would attribute to the Court a provision it never invoked. The correct formulation is that the Court resolved the Week 2(b) problem through estoppel and ratification rather than through the notice rule of Article 1873.
The Court expressly declined to rule on the validity of the agent's signature. "Even without going into the validity of Concepcion signing the 2006 Kasunduan on Conchita's behalf, the appellate court could not void the sale and transfer of half of the subject property to its qualified beneficiaries under a voluntary transfer arrangement provided in the CARL." The apparent-authority passage is thus one of several independent grounds, not the sole ratio of the disposition.
The persons who relied were not classic "third persons" transacting with a stranger's agent. They were the co-heirs, the trial court, and the tenant-beneficiaries under a statutory transfer scheme. The reliance interest the Court protected was accordingly institutional as much as contractual — the integrity of years of court-supervised raffles in which "Concepcion or Atty. Tuason repeatedly and consistently drew the lot on Conchita's behalf."
The revocation was not concealed from everyone. Conchita did file a copy with the RTC. What she omitted was notice to the agent. That the Court still found apparent authority shows that, in its view, filing with the court did not operate as notice to those dealing with the agent — a point worth pressing if the professor asks what Article 1873 would have required.
Ratification is an independent and sufficient ground. Even a student who resists the apparent-authority analysis must contend with Step 7: under Article 1317, paragraph 2, the act of an unauthorized representative is unenforceable, not void, and Conchita's years of silence after obtaining the Order and Minutes of Raffle cured it.
The quantitative limit on what was at stake. Conchita's interest was 1/8 of 1/2, or 1/16 of the entire property, as against Concepcion's 9/16; under Article 493 the alienation could in no event have prejudiced more than her own share.

D. Topic/Subtopic Integration (Mandatory)

The classification is ANALOGOUS.
Silva v. Lo is the Week 2(b) case not because it construes Article 1873 — it does not mention it — but because it presents that article's exact fact pattern and resolves it by the same policy through neighbouring provisions, and this is precisely what makes it useful for recitation.
Week 2(b) asks how the perfection of an agency operates outward, toward persons who did not participate in its constitution.
The Court's answer here is that the outward face of the agency is the principal's responsibility to maintain and, equally, to dismantle: a principal who creates an authority and then withdraws it in a manner invisible to those dealing with the agent "continue[s] to clothe" the agent with it, because "[a]pparent authority is based on the principle of estoppel" under Article 1431, and because under Article 1869 agency may be implied "from his silence or lack of action, or his failure to repudiate the agency."
That is the same allocation of risk Article 1873 makes explicit when it provides that the power "shall continue to be in full force until the notice is rescinded in the same manner in which it was given" — and the professor is entitled to be told that the Court got there by estoppel rather than by that article.
This is an inference drawn for study purposes and is labelled as such: the Court itself never equated its holding with Article 1873, and nothing above should be recited as the Court's own statement of that provision.
What the Court did hold, and what may be quoted without qualification, is that the failure to notify the agent left the agency apparently intact, and that in any event the principal's prolonged silence ratified the act under Article 1317, paragraph 2.