Katigbak v. Tai Hing Co.

    
G.R. No. L-29917 | December 29, 1928 | V
​ ILLA-REAL, ​J. 

TOPIC:​ Classifications of Agency 

 
CASE SUMMARY: ​Po Ejap was the owner of a Tacloban land w/ improvements. Po Tecsi executed a GPA in favor of 
his brother Po Ejap. Later on, Po Ejap sold the property to Po Tecsi. Using the power conferred by his brother in 
the GPA, Po Ejap sold the property to Katigbak. Po Tecsi leased the property from Po Ejap, who administered it in 
the name of Katigbak. Po Tecsi left unpaid rents until he died. Po Tecsi’s son, Po Sun Suy and Po Ching leased the 
property. Po Sun Suy was appointed administrator of the estate of deceased Po Tecsi and filed an inventory of the 
estate which included the Tacloban property. Katigbak sold the property to Po Sun Boo and filed an action against 
Tai Hing Co. (company of Po Sun Suy and Po Ching) for recovery of rent before CFI Manila. CFI ordered Po Sun Suy 
and Po Ching to pay Katigbak the accrued rentals. Po Sun Suy and Po Ching appealed to SC, claiming that Katigbak 
does not own the property (hence, not entitled to the rentals) because Po Ejap was not authorized under the GPA 
to sell the property, since it was executed before Po Ejap sold said property to Po Tecsi.  
 
SC held that Po Ejap was authorized to sell the property because the power to sell any kind of realty “belonging” 
to the principal means not only the property he had at the time of execution of the power, but also what he might 
acquire afterwards while the power was in force. Katigbak was the owner of the Tacloban property.  
 
Petitioners:​ JOSE M. KATIGBAK 
Respondents: ​TAI HING CO., defendant. PO SUN and PO CHING, intervenors-appellants. 
 
DOCTRINE: T ​ he power to sell any kind of realty "belonging" (pertenezcan) to the principal includes realty that the 
principal might acquire after the execution of the power.  
- The use of the subjunctive "pertenezcan" (might belong) and not the indicative "pertenecen" (belong), 
means not only the property he had at the time of the execution of the power, but also such as the might 
afterwards have during the time it was in force. 
 
Sec. 50 CA 496 - While it is true that a power of attorney not recorded in the registry of deeds is ineffective in 
order than an agent or attorney-in-fact may validly perform acts in the name of his principal, and that any act 
performed by the agent by virtue of said with respect to the land is ineffective against a third person who, in good 
faith, may have acquired a right thereto, it does, however, bind the principal to acknowledge the acts performed 
by his attorney-in-fact regarding said property 
 
FACTS 
1. Gabino Barreto Po Ejap owned a Tacloban property w/ improvements. It was mortgaged to PNB on May 5, 
1919 to secure the payment of P60k with 7% p.a.  
2. Nov 29, 1921 - ​Po Tecsi executed a general power of attorney in favor of his brother Gabino Barreto Po 
Ejap, ​empowering and authorizing him to "To buy, sell or barter, assign or admit in acquittance, or in any 
other manner to acquire or convey all sorts of property​,​ real and personal, businesses and industries, 
credits, rights and action belonging to me, for whatever prices and under the conditions which he may 
stipulate, paying and receiving payment in cash or in installments, and to execute the proper instruments 
with the formalities provided by the law.” 
3. Dec 15 1921 - Po Tecsi executed an instrument acknowledge an indebtedness to his brother Gabino Barreto 
Po Ejap in the sum of P68K, for properties Po Ejap sold to him 
4. March 31, 1923 - Po Ejap executed second mortgage on the aforesaid land (fact #1) with its improvements, 
in favor of Antonio M. H. Limjenco for the sum of P140,000 at 10% p.a. 
5. April 17, 1923 - ​ Po Ejap, sold the said land with its improvements to his brother Po Tecsi for P10k,​ subject 
to the same encumbrances 
6. November 22, 1923 - ​Po Ejap, making use of the power conferred on him by his brother Po Tecsi, sold 
absolutely and forever to Jose M. Katigbak, the land with its improvements for the sum of P10k 
a. The instrument indicated that only the mortgage lien of P60,000 in favor of the PNB, and without 
recording either his power of attorney or the sale in the proper certificate of title.  
b. Notwithstanding said sale Po Tecsi remained in possession of said property. 
7. October 22, 1924 - Po Tecsi leased a part of said land to Uy Chia for a period of five years This was 
recorded in the certificate of title 
8. August 24, 1924 - Po Tecsi wrote to his brother Po Ejap, complaining of Po Ejap pressuring him to pay rent 
and to call his attention for leasing the land without consulting him. Po Ejap replied that he sent him a 
draft for P2,000 back in October 1925, so he was surprised that Po Tecsi claimed the rents from the 
property 
9. Feb 27, 1925 - mortgage in favor of Limjenco was cancelled. This was recorded in the certificate of title 
 10. Nov 26, 1926 - Po Tecsi died. His son, Po Sun Suy, submitted to Po Ejap a liquidation of accounts. This 
showed the rents collected on the property up to Nov 1926 
11. Po Sun Suy was appointed as administrator of Po Tecsi’s estate. He submitted an inventory which 
included that land as one of the properties left by his father and obtained a TCT in his name as 
administrator 
12. Feb 11, 1927 - Po Ejap assigned to his son, Po Sun Boo, all his rights and actions in the credit of P68k 
against Po Tecsi 
13. Katigbak sold the property to Po Sun Boo for P10k.​ Po Sun Boo told Po Sun Suy and Po Ching (lessee but 
not mentioned when lease started) that he purchased the land and they were to pay rent to him. 
14. Ever since the property was sold by Po Ejap to Katigbak, Po Ejap administered it in Katigbak’s name  
a. Po Ejap had an oral contract of lease w/ Po Tecsi - P1,500 monthly rent, payable in advance 
b. When Po Tecsi died, Po Sun Suy (administrator) continued renting out the land to Po Ching 
15. Po Tecsi and his son Po Sun Suy has unpaid rentals, from when Po Tecsi was still alive until Katigbak sold 
the land to Po Sun Boo.  
16. Katigbak filed an action for recovery of rent of P45,280 in the CFI Manilat against the commercial firm Tai 
Hing Co., and later against the members of said firm, Po Sun Suy and Po Ching 
a. Po Sun Suy, as the judicial administrator of the estate of his deceased father Po Tecsi, filed an 
intervention praying that judgment be rendered against Katigbak, the plaintiff, declaring him not to 
be the owner of the property, therefore, not entitled to the rents of the property  
17. CFI ruled in favor of Katigbak​ and order Po Sun Suy and Po Ching to pay him the rent.  
a. It also ordered the estate of the deceased Po Tecsi to pay Po Sun Suy and Po Ching (so they can 
pay Katigbak) the rents unduly collected by Po Tecsi and his administrator, Po Sun Suy, which were 
not paid to Katigbak.  
18. Hence this petition 
ISSUES 
1. [PROCEDURAL] W/N the CFI had jurisdiction to try the case? 
a. Po Sun and Po Ching argue that since the issue of ownership was raised in the determination of 
rentals, CFI Manila had no jurisdiction since the property was in Tacloban, Leyte 
b. RULE: ​An action for the recovery of rent is a personal action,​ and as such is transitory and may be 
instituted in the province where the defendant or the plaintiff resides, at the election of the 
plaintiff  
c. APPLICATION: With respect to the collection of rents, CFI Manila has jurisdiction 
i. Manila Railroad Company vs. Attorney-General - CFI having full and unlimited jurisdiction 
over realty situated in the Philippine Islands, a ​CFI of a province may try a case concerning 
realty situated in another province so long as no objection is entered to said court's 
exercise of its jurisdiction 
ii. Po Sun and Po Ching submitted to the jurisdiction of of CFI Manila by filing a 3rd party 
claim, they cannot now object to its exercise of jurisdiction 
 
[AGENCY ISSUES] 
2. W/N Po Ejap was authorized under the power of attorney to sell the land, even if the power was executed 
before Po Ejap sold the land to Po Tecsi? - YES 
i. SC: ​Po Ejap was authorized. The power is general and authorizes Gabino Po Ejap to sell any 
kind of realty "belonging" (pertenezcan) to the principal​.  
ii. The use of the subjunctive "pertenezcan" (might belong) and not the indicative 
"pertenecen" (belong), means that P ​ o Tecsi meant not only the property he had at the time 
of the execution of the power, but also such as the might afterwards have during the time 
it was in force. 
3. W/N the power of attorney to sell realty was ineffective because it was not registered in the registry of 
deeds (as required by the Torrens System), making the sale by Po Ejap in favor of Katigbak ineffective? - 
NO  
i. Every document which affects the registered land is ineffective unless it is recorded in the 
registry of deeds. But such inefficacy only refers to third persons who, in good faith, may 
have acquired some right to the registered land 
1. Sec 29, Land Registration Act (CA 496)​ - Every applicant receiving a certificate of 
title in pursuance of a decree of registration, and every subsequent purchaser of 
registered land who takes a certificate of title for value in good faith, shall hold the 
same free of all incumbrance except noted on said certificate 
2. Sec 50, CA 496​ - While it is true that a power of attorney not recorded in the 
registry of deeds is ineffective in order than an agent or attorney-in-fact may validly 
perform acts in the name of his principal, and that any act performed by the agent 
by virtue of said with respect to the land is ineffective against a third person who, 
in good faith, may have acquired a right thereto, ​it does, however, bind the principal 
to acknowledge the acts performed by his attorney-in-fact regarding said propert​y  
 ii. SC:​ In the present case, while it is true that the non-registration of the power of attorney 
executed by Po Tecsi in favor of his brother Gabino Barreto Po Ejap prevents the sale made 
by the latter of the litigated land in favor of Jose M. Katigbak from being recorded in the 
registry of deeds,​ ​it is not ineffective to compel Tecsi to acknowledge said sale. 
b. The record shows that Po Tecsi was aware of the sale. L ​ etters from Po Ejap demanding the rent 
and remittances of rent were a tacit acknowledgement that he occupied the land, no longer as an 
owner, but as a lessee. Po Sun Suy also acknowledged that he was a lessee when he sent a letter 
to Po Ejap explaining why he cannot pay rent. Po Sun Suy and Po Ching claimed these remittances 
were for the payment of a debt but this is not mentioned in the letters 
c. SUMMARY 
i. Nov 22, 1923 - The sale by Po Ejap, as atty-in-fact of Po Tecsi, to Katigbak is valid 
ii. After the sale, Po Tecsi leased the property sold from Po Ejap, who administered it in the 
name of Katigbak. Rent ws P1,500/month. Po Tecsi left unpaid rents from Oct 22, 1925 until 
his death on Nov 26, 1926 
iii. Po Sun and Po Ching leased the land starting on Nov 26, 1926 
iv. Feb 11, 1927 - Po Sun Suy was appointed administrator of the estate of his father Po Tecsi, 
and filed with the court an inventory of said estate including the land in question 
v. May 23, 1927 - Katigbak sold the same property to Po Sun Boo. 
d. The​ ​claim for rents due and unpaid by Po Tecsi, deceased​, and proceedings for the settlement of 
whose estate have been instituted, should be presented to the committee on claims and appraisal 
appointed in said intestate proceeding in accordance with Sec. 703 of the Code of Civil Procedure 
and cannot be collected by an ordinary action 
e. As to the rents accrued and unpaid since the death of Po Tecsi,​ his son Po Sun Suy, as 
administrator of his property, having included said property in the inventory of the latter, the same 
is in custodia legis, and hence, the rents collected by said administrator of said property are also in 
custodia legis. The claim of Katigbak for the rents accrued and unpaid up to the date when said 
property was sold to Po Sun Boo, as well as the accrued and unpaid rents from the time the latter 
acquired it up to the present date, m ​ ust be presented in the court taking cognizance of the 
intestate proceeding for the settlement of Po Tecsi's estate. 
 
RULING - CFI Judgment AFFIRMED 
 
(1) That Jose M. Katigbak was the absolute owner of the property in controversy, subject to the encumbrances on 
the same appearing in the registry of deeds;  
(2) that his claim for the rents of the property in litigation accrued and unpaid by Po Tecsi before his death must 
be presented to the committee on claims and appraisal appointed in the intestate proceedings for the settlement 
of the estate of said Po Tecsi;  
(3) that the claim of Jose M. Katigbak for the rents of the said property collected by Po Sun Suy, as administrator 
of the property of the intestate estate of his father Po Tecsi, must be presented to the court having cognizance of 
said intestate proceedings.