Eduardo Litonjua, Jr. and Antonio Litonjua v. Eternit Corp. (now Eterton Multi-Resources Corp.), Eteroutremer, S.A.

and ar East !an" # $rust Co. G.R. No. 144805 June 8, 2006 Callejo, Sr. AC$S% Eternit Corp. is engaged in t e !anu"a#ture o" roo"ing !aterials and pipe produ#ts. $ts !anu"a#turing operations %ere #ondu#ted on 8 par#els o" land lo#ated in &andalu'ong Cit', #o(ered )' *C*s %it +ar East ,an- . *rust Co!pan', as trustee. /00 o" t e s ares o" sto#-s o" Eternit Corp. %ere o%ned )' Eteroutre!er S.1. Corporation 2ES1C3, a #orporation organi4ed and registered under t e la%s o" ,elgiu!. Ja#- Glan(ille, an 1ustralian #iti4en, %as t e General &anager and 5resident o" Eternit Corp., % ile Claude +rederi#- 6elsau7 %as t e Regional 6ire#tor "or 1sia o" ES1C. $n 1/86, t e !anage!ent o" ES1C gre% #on#erned a)out t e politi#al situation in t e 5 ilippines and %anted to stop its operations in t e #ountr'. * e Co!!ittee "or 1sia o" ES1C instru#ted &i# ael 1da!s, a !e!)er o" Eternit Corp.8s ,oard o" 6ire#tors, to dispose o" t e eig t par#els o" land. 1da!s engaged t e ser(i#es o" realtor9)ro-er :auro G. &ar;ue4 so t at t e properties #ould )e o""ered "or sale to prospe#ti(e )u'ers. &ar;ue4 o""ered t e par#els o" land and t e i!pro(e!ents t ereon to Eduardo ,. :itonjua, Jr. o" t e :itonjua . Co!pan', $n#. &ar;ue4 de#lared t at e %as aut ori4ed to sell t e properties "or 52<,000,000.00 and t at t e ter!s o" t e sale %ere su)je#t to negotiation. Eduardo :itonjua, Jr. responded to t e o""er. &ar;ue4 s o%ed t e propert' to Eduardo :itonjua, Jr., and is )rot er 1ntonio =. :itonjua. * e :itonjua si)lings o""ered to )u' t e propert' "or 520,000,000.00 #as . &ar;ue4 apprised Glan(ille o" t e :itonjua si)lings8 o""er and rela'ed t e sa!e to 6elsau7 in ,elgiu!, )ut t e latter did not respond. Glan(ille tele7ed 6elsau7 in ,elgiu!, in;uiring on is position9 #ounterproposal to t e o""er o" t e :itonjua si)lings. 6elsau7 sent a tele7 to Glan(ille stating t at, )ased on t e >,elgian9S%iss de#ision,? t e "inal o""er %as >@SA1,000,000.00 and 52,500,000.00 to #o(er all e7isting o)ligations prior to "inal li;uidation. :itonjua, Jr. a##epted t e #ounterproposal o" 6elsau7. &ar;ue4 #on"erred %it Glan(ille, and #on"ir!ed t at t e :itonjua si)lings ad a##epted t e #ounterBproposal o" 6elsau7. Ce also stated t at t e :itonjua si)lings %ould #on"ir! "ull pa'!ent %it in /0 da's a"ter e7e#ution and preparation o" all do#u!ents o" sale, toget er %it t e ne#essar' go(ern!ental #learan#es. * e :itonjua )rot ers deposited t e a!ount o" @SA1,000,000.00 %it t e Se#urit' ,an- . *rust Co!pan', Er!ita ,ran# , and dra"ted an Es#ro% 1gree!ent to e7pedite t e sale. Dit t e assu!ption o" Cora4on 1;uino as 5resident o" R5, t e politi#al situation in t e 5 ilippines ad i!pro(ed. &ar;ue4 re#ei(ed a telep one #all "ro! Glan(ille, ad(ising t at t e sale %ould no longer pro#eed. Glan(ille "ollo%ed it up %it a letter, #on"ir!ing t at e ad )een instru#ted )' is prin#ipal to in"or! &ar;ue4 t at t e de#ision as )een ta-en at a ,oard &eeting not to sell t e properties on % i# Eternit Corp. is situated. D en apprised o" t is de(elop!ent, t e :itonjuas, t roug #ounsel, %rote Eternit Corp., de!anding pa'!ent "or da!ages t e' ad su""ered on a##ount o" t e a)orted sale. EC, o%e(er, reje#ted t eir de!and. &SS'E% DEN &ar;ue4, Glan(ille, and 6elsau7 %ere aut ori4ed )' respondent Eternit Corp. to a#t as its agents relati(e to t e sale o" t e properties o" Eternit Corp., and i" so, % at are t e )oundaries o" t eir aut orit' as agents (EL)% No. 1 #orporation is a juridi#al person separate and distin#t "ro! its !e!)ers or sto#- olders and is not a""e#ted )' t e personal rig ts, o)ligations and transa#tions o" t e latter. $t !a' a#t onl' t roug its )oard o" dire#tors or, % en aut ori4ed eit er )' its )'Bla%s or )' its )oard resolution, t roug its o""i#ers or agents in t e nor!al #ourse o" )usiness. * e general prin#iples o" agen#' go(ern t e relation )et%een t e #orporation and its o""i#ers or agents, su)je#t to t e arti#les o" in#orporation, )'B la%s, or rele(ant pro(isions o" la%. * e propert' o" a #orporation is not t e propert' o" t e sto#- olders or !e!)ers, and as su# , !a' not )e sold %it out e7press aut orit' "ro! t e )oard o" dire#tors. 5 'si#al a#ts, li-e t e o""ering o" t e properties o" t e #orporation "or sale, or t e a##eptan#e o" a #ounterBo""er o" prospe#ti(e )u'ers o" su# properties and t e e7e#ution o" t e deed o" sale #o(ering su# propert', #an )e per"or!ed )' t e #orporation onl' )' o""i#ers or agents dul' aut ori4ed "or t e purpose )' #orporate )'Bla%s or )' spe#i"i# a#ts o" t e )oard o" dire#tors. 1)sent su# (alid delegation9aut ori4ation, t e rule is t at t e de#larations o" an indi(idual dire#tor relating to t e a""airs o" t e #orporation, )ut not in t e #ourse o",

or #onne#ted %it , t e per"or!an#e o" aut ori4ed duties o" su# dire#tor, are not )inding on t e #orporation. D ile a #orporation !a' appoint agents to negotiate "or t e sale o" its real properties, t e "inal sa' %ill a(e to )e %it t e )oard o" dire#tors t roug its o""i#ers and agents as aut ori4ed )' a )oard resolution or )' its )'Bla%s.F0 1n unaut ori4ed a#t o" an o""i#er o" t e #orporation is not )inding on it unless t e latter rati"ies t e sa!e e7pressl' or i!pliedl' )' its )oard o" dire#tors. 1n' sale o" real propert' o" a #orporation )' a person purporting to )e an agent t ereo" )ut %it out %ritten aut orit' "ro! t e #orporation is null and (oid. 1n agen#' !a' )e e7pressed or i!plied "ro! t e a#t o" t e prin#ipal, "ro! is silen#e or la#- o" a#tion, or is "ailure to repudiate t e agen#' -no%ing t at anot er person is a#ting on is )e al" %it out aut orit'. 1##eptan#e )' t e agent !a' )e e7pressed, or i!plied "ro! is a#ts % i# #arr' out t e agen#', or "ro! is silen#e or ina#tion a##ording to t e #ir#u!stan#es. 1gen#' !a' )e oral unless t e la% re;uires a spe#i"i# "or!. Co%e(er, to #reate or #on(e' real rig ts o(er i!!o(a)le propert', a spe#ial po%er o" attorne' is ne#essar'. * e :itonjuas "ailed to addu#e in e(iden#e an' resolution o" t e ,oard o" 6ire#tors o" Eternit Corp. e!po%ering &ar;ue4, Glan(ille or 6elsau7 as its agents, to sell, let alone o""er "or sale, "or and in its )e al", t e 8 par#els o" land o%ned )' Eternit Corp. in#luding t e i!pro(e!ents t ereon. * e )are "a#t t at 6elsau7 !a' a(e )een aut ori4ed to sell to Ruperto *an t e s ares o" sto#- o" respondent ES1C #annot )e used as )asis "or :itonjua8s #lai! t at e ad li-e%ise )een aut ori4ed )' Eternit Corp. to sell t e par#els o" land. D ile Glan(ille %as t e 5resident and General &anager o" Eternit Corp., and 1da!s and 6elsau7 %ere !e!)ers o" its ,oard o" 6ire#tors, t e t ree a#ted "or and in )e al" o" respondent ES1C, and not as dul' aut ori4ed agents o" Eternit Corp.G a )oard resolution e(in#ing t e grant o" su# aut orit' is needed to )ind Eternit Corp. to an' agree!ent regarding t e sale o" t e su)je#t properties. Su# )oard resolution is not a !ere "or!alit' )ut is a #ondition sine ;ua non to )ind Eternit Corp. Re;uisites o" an agen#' )' estoppelsH 213 t e prin#ipal !ani"ested a representation o" t e agent8s aut orit' or -no%ingl' allo%ed t e agent to assu!e su# aut orit'G 223 t e t ird person, in good "ait , relied upon su# representationG 2F3 rel'ing upon su# representation, su# t ird person as # anged is position to is detri!ent.