G.R. No. 125678 - Philamcare Health Systems, Inc. vs. Court of Appeals

The suit involves a dispute over a rice-mill and camarin located at Dao, Province of Capiz.
Plaintiff (DY BUNCIO & COMPANY, INC.) claims that the properties belong to its judgment debtor, Ong Guan Can.
Defendants (Juan Tong and Pua Giok Eng) assert their rights as owner and lessee by virtue of a deed purportedly executed on July 31, 1931, by Ong Guan Can, Jr.

The deed’s first recital states that Ong Guan Can, Jr. acted as agent of Ong Guan Can, proprietor of the commercial firm Ong Guan Can & Sons, to sell the rice-mill and camarin for P13,000.
The agent’s authority was purportedly derived from a power of attorney dated May 23, 1928, a copy of which was attached to, and recorded with, the deed at the register of deeds of Capiz.
The receipt for the sum received was acknowledged in the agent’s name, and the deed was signed solely by the agent without specifying that he acted on behalf of the principal.

Irrespective of other irregularities, the court focused on the nature of the power of attorney attached to the deed.
It was noted that the power of attorney was limited in scope and did not expressly grant the authority to alienate the properties, as required under Article 1713 of the Civil Code.
Defendants introduced Exhibit 1, which purported to be a general power of attorney given in 1920, claiming it cured the defect in authority.

The Court observed that Article 1732 of the Civil Code is silent on the partial termination of an agency, implying that a new appointment affecting the agent’s powers—whether enlarging or decreasing—must be considered as a supplanting and revocation of the previous appointment if inconsistencies exist.
The court noted that the execution of the second power of attorney, when it introduced limited powers that were inconsistent with the earlier general authority, amounted to a futile gesture in terms of effecting valid alienation.

Whether the deed, which was executed by an agent under a limited power of attorney, effectively conveyed title to the defendant as owner and lessee.

Whether the power of attorney attached to the deed (dated May 23, 1928) was sufficient to empower the agent to alienate the property.
Whether Exhibit 1, the purported general power of attorney from 1920, could cure the defect arising from the limited nature of the power of attorney attached to the deed.

Whether the subsequent execution of a new, limited power of attorney automatically revokes the general power of attorney or creates a conflict that invalidates the deed altogether.