LITONJUA, JR. v.

ETERNIT CORPORATION
G.R. No. 144805 June 8, 2006
Facts
Eteroutremer S.A. Corporation (ESAC) owned 90% of the shares of stocks of Eternit Corporation (EC), the formers general manager
is Glanville and regional director is Delsaux. In 1986, the management of ESAC grew concerned about the political situation in the Philippines,
therewith, ESAC instructed Adam, member of ECs BOD to dispose of eight parcels of land from which EC is conducting its operation.
Adam engaged the services of Marquez to look for prospective buyers. And after offer and counter-offer, the parties came to an
agreement with the Litonjua siblings (petitioners), the latter will be buying the parcels of land. Petitioners deposited the amount needed.
For some reason after the assumption of `Pres. Aquino, Marquez received from Glanville an advice not to proceed with the sale. When
apprised of this development, petitioners, through counsel, wrote EC, demanding payment for damages they had suffered on account of the
aborted sale. EC, however, rejected their demand.
Issue
Are Marquez, Glanville, and Delsaux authorized by respondent EC to act as its agents?
Held
No. The Litonjuas failed to adduce in evidence any resolution of the Board of Directors of EC empowering Marquez, Glanville or
Delsaux as its agents, to sell, let alone offer for sale, for and in its behalf, the 8 parcels of land owned by it, including the improvements
thereon.While Glanville was the President and General Manager of Eternit Corp., and Adams and Delsaux were members of its Board of
Directors, the three acted for and in behalf of respondent ESAC, and not as duly authorized agents of EC; a board resolution evincing the grant
of such authority is needed to bind EC to any agreement regarding the sale of the subject properties. Such board resolution is not a mere
formality but is a condition sine qua non to bind EC.