Facts:

• Gloria A. Anacleto is the petitioner; Alexander Van Twest and Euroceanic Rainbow Enterprises Philippines, Inc. are the respondents.
• On February 6, 1995, a complaint for reconveyance of title was filed against Anacleto and Isaias M. Bongar by Van Twest and Euroceanic.
• Atty. Ernesto V. Perez represented Van Twest, who had been missing since June 16, 1992.
• A compromise agreement was entered into on March 31, 1995, stipulating Anacleto would pay Van Twest P4,800,000.00 with specific payment terms.
• The trial court rendered judgment based on this agreement on April 6, 1995.
• Anacleto later questioned the agreement's validity, claiming Atty. Perez lacked a special power of attorney (SPA) to represent Van Twest.
• Atty. Perez admitted he had no SPA but argued Anacleto's former counsel was aware of this.
• The trial court denied Anacleto's motion to question the agreement and her motion to vacate the judgment.
• Anacleto's notice of appeal was dismissed as late, leading her to file a petition for certiorari in the Court of Appeals, which was dismissed.
• Anacleto then sought a review on certiorari from the Supreme Court.

Issue:

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Ruling:

• The Supreme Court ruled that the petitioner is not estopped from questioning the validity of the compromise agreement.
• The Court declared the compromise agreement void due to Atty. Perez's lack of authority to enter into it on behalf of Van Twest and Euroceanic.
• The Court decided ...(Unlock)

Ratio:

• The Supreme Court emphasized that a compromise agreement requires the consent of all parties and must comply with Article 1318 of the Civil Code.
• Atty. Perez's admission of lacking a special power of attorney rendered the agreement void.
• The Court noted that a lawyer's authority to compromise must be explicitly granted and cannot be presumed, as per Article 1878 of the Civil Code.
• The appellate court's finding of estoppel was rejected; Anacleto's former counsel relied on Atty. Perez's ...continue reading