RALLOS v.

FELIX GO CHAN & SONS REALTY CORPORATION and CA

G.R. No. L-24332
January 31, 1978

Facts: Sisters Concepcion and Gerundia Rallos were registered co-owners of Lot No. 5938 of the
Cadastral Survey of Cebu covered by Transfer Certificate of Title (TCT) No. 11116 of the Registry
of Cebu. On April 21, 1954, they executed a special power of attorney in favor of their brother,
Simeon Rallos, authorizing him to sell for and in their behalf the said parcel of land.

On March 3, 1955, Concepcion died. On September 12, 1955, Simeon sold the undivided shares
of his sisters to Felix Go Chan & Sons Realty Corporation, registered under new TCT No. 12989
in the name of the latter.

On May 18, 1956, Ramon Rallos, as administrator of the intestate estate of Concepcion, filed a
complaint before the Court of First Instance of Cebu, seeking the nullification of sale with respect
to Concepcion’s undivided share. The court a quo decided in favor of Ramon.

Thereafter, Felix Go Chan appealed to the Court of Appeals. The appellate court reversed the
decision of the court a quo. Hence, the instant petition.

Issue: Whether or not the sale in behalf and after the death of Concepcion, is null and void.

Held: Yes. Agency is basically personal representative, and derivative in nature. The authority of
the agent to act emanates from the powers granted to him by his principal. By reason of the very
nature of the relationship between principal and agent, agency is extinguished by the death of the
principal or the agent.

The foregoing general rule is provided under Paragraph 3 of Art. 19191 of the Civil Code. Articles
19302 and 19313 of the same code, on the other hand, provide exceptions to the general rule.

In the instant case, Article 1930 is not involved because admittedly the special power of attorney
executed in favor of Simeon was not coupled with an interest.

Furthermore, it cannot be questioned that the agent, Simeon, knew of the death of his principal at
the time he sold the latter's share to Felix Go Chan & Sons. Hence, on the basis of the established
knowledge of Simeon concerning the death of his principal Concepcion, Article 1931 of the Civil
Code is inapplicable. The law expressly requires for its application lack of knowledge on the part
of the agent of the death of his principal; it is not enough that the third person acted in good faith.

1 Agency is extinguished. xxx xxx xxx 3. By the death, civil interdiction, insanity or insolvency of the principal or of the agent

2 The agency shall remain in full force and effect even after the death of the principal, if it has been constituted in the common
interest of the latter and of the agent, or in the interest of a third person who has accepted the stipulation in his favor.

3 Anything done by the agent, without knowledge of the death of the principal or of any other cause which extinguishes the agency,
is valid and shall be fully effective with respect to third persons who may have contracted with him in good. faith.

Rollon, Alyanna R.
ATAP – Sec 41 – T 7:30-9:30PM