Case Summary (G.R. No. 150128)
Factual Background
On May 5, 1980, the PNR accepted an offer by Gaudencio Romualdez to purchase unserviceable rails at specified rates, the purchase aggregating P 96,600.00. Romualdez paid the stated purchase price and on May 26, 1980 addressed a letter to Atty. Cipriano Dizon, Acting Purchasing Agent of PNR, stating that he had “authorized the bearer, LIZETTE R. WIJANCO … to be my lawful representative in the withdrawal of the scrap/unserviceable rails awarded to me” and that he had given her the award and official receipt which “will indicate my waiver of rights, interests and participation in favor of LIZETTE R. WIJANCO.” That bearer was the petitioner’s now deceased wife, Lizette. On the same date Lizette requested and obtained permission to change the withdrawal locations; the PNR later suspended withdrawals citing documentary discrepancies and reported pilferages in Tarlac. The spouses Angeles demanded a refund of P 96,000.00. PNR refused and relied on a delivery receipt signed by Lizette showing that 54.658 metric tons had been withdrawn, valueless at P 2,100.00 per metric ton amounting to P 114,781.80, an amount exceeding the alleged refund.
Trial Court Proceedings
On August 10, 1988, the spouses Angeles filed a complaint for specific performance and damages against PNR and its corporate secretary, among others, praying for delivery of 46 metric tons of scrap rails and for damages and attorney’s fees. After joinder of issues and trial, and after the death of Lizette, her heirs, including petitioner, were substituted. On April 16, 1996, the RTC dismissed the complaint for lack of cause of action. The trial court found that Lizette acted only as Romualdez’s representative in the withdrawal of the rails and that she was not an assignee of Romualdez’s rights; therefore the plaintiffs were not the real parties-in-interest.
Court of Appeals' Decision
The Court of Appeals, in CA-G.R. CV No. 54062, affirmed the RTC in its Decision of June 4, 2001 and denied reconsideration in a Resolution dated September 17, 2001. The CA concurred that the May 26, 1980 letter constituted an authorization for Lizette to act as representative or agent only and did not effect an assignment of Romualdez’s contractual rights. The CA accepted the trial court’s factual findings concerning the nature of Lizette’s authority and her representative acts, including her signature on the withdrawal receipt.
Issues Presented on Petition for Review
The petition for review under Rule 45, Rules of Court presented the narrow legal question whether the Romualdez letter of May 26, 1980 made Lizette an assignee with authority to sue in her own name or whether the letter merely constituted an agency authorization that rendered Lizette without standing to prosecute the action and, consequently, whether petitioner had standing as conjugal partner or heir.
Petitioner’s Contentions
Petitioner argued that the Romualdez letter showed an intent to transfer rights to Lizette because it referred to a “waiver of rights, interests and participation in favor of LIZETTE R. WIJANCO,” and contended that the words “agent” or “attorney-in-fact” were not used and therefore the instrument should be construed as evidencing assignment rather than mere agency. Petitioner also asserted that Lizette had paid the P 96,000.00 to PNR and thus had a proprietary interest enjoyed by an assignee.
Respondents’ Contentions
Respondents maintained that the May 26, 1980 letter merely authorized Lizette to withdraw the awarded rails as Romualdez’s representative. PNR further relied on the delivery receipt signed by Lizette showing withdrawal of 54.658 metric tons valued at P 114,781.80, and refused the refund demand on that basis. The position of the trial court and the CA was that the contemporaneous documents and subsequent acts of the parties corroborated the agency relationship and negated any assignment.
Supreme Court’s Ruling
The Supreme Court denied the petition and affirmed the CA decision. The Court held that the Romualdez letter, read in context, demonstrated that Lizette was authorized to act as Romualdez’s representative for the withdrawal of the rails and not as an assignee of Romualdez’s rights. The Court found that Romualdez used the verb “authorized,” intended to retain his interest, and that the phrase “For this reason, I have given her the original copy of the award … which will indicate my waiver of rights, interests and participation in favor of LIZETTE R. WIJANCO” must be read in light of the antecedent that Lizette had been appointed representative for withdrawal. The Court concluded that the plaintiffs were not real parties-in-interest and that petitioner, whether as conjugal partner or heir, lacked standing. The petition was denied with costs against the petitioner.
Legal Basis and Reasoning
The Court applied the rule that an agent ordinarily has no rights or liabilities as against third parties and cannot sue on a contract made for the principal unless the agent is constituted as an assignee. The Court cited the rule that the “real party-in-interest” principle recognizes assignments of rights, but that an agent who is not an assignee lacks personality to sue. The Court relied on Article 1374, Civil Code, that contract stipulations must be read together to determine the real intention from the whole instrument, and on Article 1371, Civil Code, that contemporaneous and subsequent acts are principal indicia of the parties’ intention. The Court observed that the spouses’ own letters and the withdrawal receipt re
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Parties and Procedural Posture
- Laureano T. Angeles filed a petition for review under Rule 45, Rules of Court appealing the Court of Appeals' decision and resolution in CA-G.R. CV No. 54062.
- Philippine National Railways (PNR) and Rodolfo Flores were respondents in the trial court action and respondents in the administrative proceedings described in the records.
- The Court of Appeals rendered a decision dated June 4, 2001 affirming the Regional Trial Court and denied reconsideration by resolution dated September 17, 2001.
- The Regional Trial Court of Quezon City, Branch 79, rendered judgment on April 16, 1996 dismissing the complaint for lack of cause of action.
- The petitioner sought reversal of the CA decision on the ground that the plaintiffs below were the real parties-in-interest and had standing to sue.
- The Supreme Court denied the petition and affirmed the decision of the Court of Appeals and awarded costs against the petitioner.
Key Factual Allegations
- On May 5, 1980, PNR accepted Gaudencio Romualdez's offer to buy PNR scrap/unserviceable rails located in Del Carmen and Lubao, Pampanga at P1,300.00 and P2,100.00 per metric ton respectively for a total of P96,600.00.
- Romualdez paid the purchase price and on May 26, 1980 sent a letter to Atty. Cipriano Dizon stating that he had authorized the bearer, Lizette R. Wijanco, to be his lawful representative in the withdrawal of the awarded rails.
- The May 26, 1980 letter stated that Romualdez gave Lizette the original award and official receipt and that such documents would indicate his waiver of rights, interests, and participation in favor of Lizette R. Wijanco.
- On the same day, Lizette requested and obtained PNR approval to transfer the location of withdrawal to Murcia, Capas and San Miguel, Tarlac, and a subsequent PNR suspension of withdrawals occurred because of alleged documentary discrepancies and reported pilferages worth over P500,000.00.
- The spouses Angeles demanded the refund of P96,000.00 after the suspension, and PNR countered that a delivery receipt signed by Lizette showed the withdrawal of 54.658 metric tons worth P114,781.80.
- On August 10, 1988, the spouses Angeles filed suit against PNR and its corporate secretary for specific performance and damages and prayed for delivery of 46 metric tons of scrap rails and for attorney’s fees.
- Lizette W. Angeles later died and was substituted by her heirs, including petitioner Laureano T. Angeles.
Issues Presented
- Whether the May 26, 1980 letter from Romualdez to Atty. Dizon constituted an assignment of Romualdez’s rights to Lizette or merely an agency designation authorizing her to withdraw the rails.
- Whether the plaintiffs below were the real parties-in-interest and therefore had standing to maintain the action for specific performance and damages.
Contentions of the Parties
- The petitioner contended that the May 26, 1980 letter made Lizette an assignee with capacity to sue in her own name and that she paid the P96,000.00 to PNR.
- PNR contended that Lizette acted only as Romualdez’s representative or agent and that Romualdez remained the principal with contractual rights retained by him.
- The trial court and the Court of Appeals contended that the evidence showed an agency relationship and that the plaintiffs below were not the real parties-in-interest.
Trial Court Findings
- The trial