G.R. No. 214057 - Bautista-Spille vs. NICORP Management and Development Corp.

Petitioner Florentina Bautista-Spille (Petitioner) is the registered owner of a parcel of land covered by Transfer Certificate of Title (TCT) No. T-197, located in Imus City, Cavite, measuring approximately 33,052 square meters (Subject Property).
On June 20, 1996, Petitioner and her spouse executed a General Power of Attorney (GPA) in favor of her brother, Defendant Benjamin Bautista (Benjamin), authorizing him to administer all of Petitioner’s businesses and properties in the Philippines. The GPA was notarized before the Philippine Consulate General in New York, USA.

On August 13, 2004, Benjamin and NICORP Management and Development Corporation (NICORP) entered into a contract to sell involving the Subject Property, with a purchase price of PHP 15,000,000.00.
NICORP was to pay a 20% down payment (PHP 3,000,000.00) and the balance over eight months. Upon receipt of the down payment, the TCT was to be deposited in escrow with International Exchange Bank (IE Bank).
The contract required Benjamin to submit a Special Power of Attorney (SPA) authorizing the sale; otherwise, payments would be suspended and penalties of PHP 150,000.00 per month imposed.
An Escrow Agreement was executed on October 13, 2004, designating IE Bank as escrow agent holding the TCT. NICORP issued a down payment check (PHP 2,250,000.00) on October 14, 2004, and the TCT was placed in escrow.

Upon discovering the sale, Petitioner’s counsel sent demand letters to NICORP, Benjamin, and IE Bank, opposing the sale and demanding the return of the original title to Petitioner’s attorney-in-fact, Manuel B. Flores, Jr.
NICORP, Benjamin, and IE Bank refused to return the title. Petitioner filed a complaint for declaration of nullity of contract, injunction, recovery of possession, and damages, with a prayer for a preliminary injunction to stop NICORP’s development activities.
The Regional Trial Court (RTC) granted the preliminary injunction on January 24, 2005, restraining NICORP from subdividing or selling the Subject Property.

NICORP argued Benjamin was validly authorized by the GPA to sell, claiming the authority was “coupled with interest” due to partial payment, and that Petitioner had not revoked the GPA.
IE Bank denied any liability, asserting Benjamin had the authority at the time of escrow, and that it was bound by the escrow agreement.
Benjamin failed to file an answer and was declared in default.

On May 24, 2010, the RTC declared the contract to sell null and void, ruling the GPA only granted administrative authority and not authority to sell.
The court noted NICORP’s awareness of Benjamin’s lack of authority was shown by the requirement for the SPA and penalties for failure to procure it.
The RTC ordered the return of the property and title to Petitioner, awarded attorney’s fees, and cost of suit against NICORP and IE Bank.

The CA reversed the RTC, ruling the GPA authorized Benjamin to sell the property as it conferred power to buy, sell, negotiate, and contract over Petitioner’s properties.
Petitioner filed a motion for reconsideration, denied by the CA.
Petitioner contended that the GPA did not specifically authorize the sale of the Subject Property and highlighted NICORP’s judicial admission during pre-trial that Benjamin acted beyond his authority in effecting the sale.
NICORP maintained it was a buyer in good faith and that the GPA granted sufficient authority, with the SPA requirement merely procedural for government compliance.

Whether Benjamin Bautista was authorized by the General Power of Attorney to enter into a contract to sell the Subject Property.
Whether NICORP could be considered a purchaser in good faith despite lacking clear proof of Benjamin’s authority to sell.
Whether the contract to sell entered into by Benjamin and NICORP was valid and enforceable.