Woodchild vs Roxas G.R. 140667 August 12, 2004 436 SCRA 235.pdf

1) Woodchild Holdings, Inc. vs. Roxas Electric and Construction Co., Inc. 436 SCRA 235 FACTS:  FACTS:  The respondent Roxas Electric and Construction Company, Inc. (RECCI) was the owner of two parcels of land; Lot No. 491-A-3-B-1(Lot 491-A-3-B-1(Lot A) A) and Lot No. 491-A-3-B-2(Lot 491-A-3-B-2(Lot B). B). In the resolution approved by the BODs, Roberto Roxas was Roxas  was authorized, as its president, to sell Lot B. B. Petitioner Woodchild Holdings, Inc. (WHI), (WHI), through its president, Jonathan Dy, Dy, offered to buy the said land under terms that the seller A accessing to the Sumulong grants the buyer to beneficial use and a right of way over a portion of Lot A accessing Highway, and agrees to sell additional square meters from his adjacent lot, Lot A, A, as right of way. In the Deed of Absolute Sale, it included provisions which allowed WHI to purchase additional square meters for its beneficial use and right of way. During the course of their businesses, Dy and Roxas discussed the need of WHI to purchase an additional 500-square-meter portion of Lot A. A. Unfortunately, Roxas died. WHI then wrote to RECCI, expressing the former's request to let them purchase of a portion of Lot A as granted by the Deed of Absolute Sale. After the exhaustive demands, WHI filed a complaint against RECCI to the RTC-Makati for specific performance and damages involving the latter's unjustifiable refusal to merit the former's request. RECCI alleged that it never authorized Roxas, to grant the beneficial use of any portion of Lot A, A, nor agreed to sell any portion thereof or create a lien or burden thereon. It alleged B. RTC ruled that, under the Resolution approved on May 17, 19 91, it merely authorized Roxas to sell Lot B. in favor of WHI since RECCI was estopped from disowning the apparent authority of Roxas under the resolution of its BODs. CA reversed the decision of the RTC since Roxas was merely authorized to sell Lot B but not to grant right of way in favor of the WHI over a portion of Lot A, A, or to grant an option to the petitioner to buy a portion thereof. Issue(s):

WON the respondent is bound by the provisions in the deed of absolute sale granting to the petitioner beneficial use and a right of way over a portion of Lot A  A  accessing to the Sumulong Highway and granting the option to the petitioner to buy a portion thereof. WON the WON the agreement is enforceable against the respondent. Held: The Supreme Court affirmed the decision of the CA. Respondent is not bound by the provisions in the Deed of Absolute Sale since Roxas in the first place was not expressly authorized to impose any burden or to grant a right of o f way in favor of the petitioner. GENERALLY, the acts of the corporate officers within the scope of their authority are binding on the corporation. However, under Article 1910 of the New Civil Code, acts done by such officers beyond the scope of their authority cannot bind the corporation unless it has ratified such acts expressly or tacitly, or is estopped from denying them. In the case at bar, no evidence on record of specific acts made by the respondent showing or indicating that it had full knowledge of any representations made by Roxas to the petitioner that the respondent A or to create a burden had authorized him to grant to the respondent an option to buy a portion of  Lot of  Lot A or or lien thereon, or that the respondent allowed him to do so. Since the respondent had not ratified the unauthorized acts of Roxas, the same are unenforceable.