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Ching vs.

Bantolo
687 SCRA 134

There is no question that the SPA executed by respondents in favor of petitioners


is a contract of agency coupled with interest. This is because their bilateral contract
depends upon the agency. Hence, it “cannot be revoked at the sole will of the principal”.

Sarsaba vs. Vda. De Te


594 SCRA 410

ISSUE:
Whether or not the action filed survives despite the death of the principal.

HELD:
The contract of agency is extinguished. However, while it may be true that with
the death of Vda. De Te, the Special Power of Attorney she executed is rendered functus
officio, this Court believes that the Attorney-in-fact has not lost his personality to
prosecute this case. When this case was filed, by the Attorney-in-fact, Vda. De Te was
very much alive. The proper remedy is the Substitution of Heirs and not the dismissal of
the case.

Estate of the Late Juliana Diez Vda. De Gabriel vs. CIR


421 SCRA 266

FACTS:
The decedent Vda. De Gabriel had her business affairs managed by Philtrust.
After her death, Philtrust’s officer, Atty. Nuyles filed the latter’s Income Tax Return for
1978 but it did not indicate that the decedent had died.
The BIR conducted an administrative investigation on the decedent’s tax liability
and found a deficiency income tax. Respondent Commissioner of Internal Revenue
issued warrants of distraint and levy to enforce collection of the decedent’s deficiency
income tax liability, which was served upon her heir, Gabriel.
Philtrust, by filing the income tax return, constituted itself as the administrative of
the estate of the deceased at least as the return is concerned. However, Petitioner Estate
denies that Philtrust had any legal personality to represent the decedent and argues that
there was no proper notice of assessment, which never became final, executory and
incontestable.

ISSUE:
Whether or not Philtrust is considered as administrator of the estate of the
deceased by filing the income tax return.

HELD:
The death of the taxpayer automatically severed the legal relationship between her
and her agent and such could not be revived by the mere fact that the agent and such
could not be revived by the mere fact that the agent filed the principal’s Income Tax
Return.
Therefore, none of Philtrust’s acts or omissions could bind the Estate of the
taxpayer. Philtrust was never appointed as administrator of the Estate of the decedent.
Their relationship had been inexistent for 3 years, which indicated that there was no legal
relationship to the deceased or to her Estate.

Rallos vs. Felix Go Chan


81 SCRA 251

FACTS:
Concepcion and Gerundia Rallos were sisters and registered co-owners of a parcel
of land of the Cadastral Survey of Cebu. They executed a Special Power of Attorney in
favor of Simeon, their brother, authorizing him to sell for and in behalf of the lot.
After the death of Concepcion, Simeon sold the latter’s undivided shares of the lot
to Go Chan.

ISSUE:
Whether or not the act of Simeon as agent was valid and effective.

HELD:
No, it was invalid and ineffective. The contract of agency is extinguished by the
death of the principal. Article 1931 is inapplicable in this case because Simeon knew of
the death of his principal at the time he sold the latter’s share in Lot No. 5983 to Go
Chan. The act is void ab initio.
It is only valid if these two conditions are present: (1) the agent acted without
knowledge of the death of the principal; and (2) the third person who contracted with the
agent himself acted in good faith.

Buason vs. Panuyas


105 Phil. 795

FACTS:
Spouses Dayao and Vega acquired a homestead patent of a parcel of land in
Nueva Ecija. They executed a Power of Attorney authorizing Bayuga to engage the
services of an attorney to prosecute their case against Gambito for annulment of a
contract of sale of a parcel of land.
However, Dayao died. Thereafter, his 4 children executed a deed of sale
conveying the parcel of land to the Spouses Panuyas and Cruz. In this case, Buason and
Panuyas claim ownership of the land.
The Power of Attorney executed by Dayao authorizing Bayuga to sell the parcel
of land was annotated or inscribed on the back of the original certificate of title and sale
executed by Bayuga in favor of Panuyas and wife likewise had the same. It does not
appear that the appellee and the wife had actual knowledge of the previous sale.

ISSUE:
Whether or not the act of Bayuga was valid and effective.

RULING:
Yes, it was valid and effective. The contention that as the death of the principal
ended the authority of the agent, the sale made by the latter of the land in question after
the death of the principal is null and void, is untenable.
It not having been shown that the agent knew of the principal’s demise and for
that reason, the sale made by the agent is valid and effective with respect to third persons
who have contracted with him in good faith. Hence, the conditions in Article 1931 apply
and were both present in this case.

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