Case Summary (G.R. No. 202364)
Petitioner
Arturo C. Calubad, lender and purchaser at extrajudicial foreclosure sale, insisting Ricarcen is estopped from denying Marilyn’s authority and benefited from the loan proceeds.
Respondent
Ricarcen Development Corporation, a family-owned real estate lessor, repudiating Marilyn’s acts as unauthorized and the mortgage contracts as void, alleging fabricated corporate resolutions and certificates.
Key Dates
• October 15, 2001: Original P4 million loan and mortgage executed.
• December 6, 2001 & May 8, 2002: Amendments increasing the loan to P5 million and an additional P2 million.
• March 19–27, 2003: Extrajudicial foreclosure and issuance of Certificate of Sale to Calubad.
• January 6, 2009: RTC grants Ricarcen’s complaint, annuls mortgage and foreclosure.
• January 25, 2012: CA affirms RTC decision.
• August 30, 2017: Supreme Court renders decision under the 1987 Constitution.
Applicable Law
• 1987 Philippine Constitution (decision after 1990)
• Corporation Code, Art. 23 (corporate powers exercised by board, delegable to officers)
• Civil Code Art. 1317 (necessity of delegation to bind principal)
• Civil Code Art. 1431 & 1869 (estoppel and implied agency)
• Jurisprudence on apparent authority and estoppel (Yao Ka Sin Trading v. Court of Appeals)
Loan and Mortgage Transactions
Marilyn, as president, executed three mortgage contracts securing P4 million, then P5 million, and finally P7 million in aggregate loans. The first interest payment was deducted from proceeds. Calubad required and received a board resolution and two secretary’s certificates allegedly authorizing Marilyn. Loan proceeds were disbursed via checks to Ricarcen’s account, and Ricarcen issued multiple interest-payment checks to Calubad.
Fabrication of Corporate Documents
Ricarcen later discovered in July 2003 that the board resolution and secretary’s certificates presented to Calubad were not recorded in the notarial register. The corporate secretary, Elizabeth, denied signing the specific documents, attributing signed blank sheets to Marilyn’s misuse.
Lower Courts’ Rulings
The RTC annulled the mortgage contracts and foreclosure for lack of proof of Marilyn’s authority and fabrication of corporate documents. It dismissed claims against Registry of Deeds personnel. The CA upheld the RTC, finding that the presumption of validity of notarized corporate acts was overcome by clear, convincing proof of fabrication. It rejected laches and estoppel arguments by Calubad.
Exception to Rule 45 Review
The Supreme Court held that an appeal by certiorari under Rule 45 may consider factual findings when “the inference made is manifestly mistaken.” It found the lower courts’ refusal to recognize estoppel based on apparent authority to be a misapprehension of facts requiring correction.
Doctrine of Apparent Authority and Estoppel
Under the 1987 Constitution and relevant statutes, a corporation is estopped from denying the apparent authority it negligently or intentionally grants to an officer, as to innocent third parties who deal in good faith. Apparent authority arises from the principal’s conduct, not merely the agent’s acts.
Evidence of Ricarcen’
Case Syllabus (G.R. No. 202364)
Procedural Posture
- Petitioner Arturo C. Calubad filed a Petition for Review on Certiorari under Rule 45 of the Rules of Court, assailing:
• The January 6, 2009 Decision of the Regional Trial Court (Branch 218, Quezon City) in Civil Case No. Q-03-50584
• The January 25, 2012 Decision and June 20, 2012 Resolution of the Court of Appeals in CA-GR. CV No. 93185 - RTC rendered judgment annulling the mortgage contracts, extrajudicial foreclosure, and sale; CA affirmed; SC granted review and reversed.
Facts
- Ricarcen Development Corporation (Ricarcen) is a family corporation owning Lot No. 53 Linaw St., Sta. Mesa Heights, Quezon City (TCT No. RT-84937), subdivided into two lots.
- Marilyn R. Soliman served as Ricarcen’s president (2001–Aug 2003). Other directors: Erlinda Villanueva, Josefelix R. Villanueva, Maura Rico, Ma. Elizabeth V. Chamorro, Ma. Theresa R. Villanueva, Annabelle R. Villanueva.
- October 15, 2001 – Marilyn, as president, contracted P4,000,000 loan from Calubad, secured by mortgage over Ricarcen’s property; terms: 5% interest first month, 3% succeeding months, 1% penalty for delay; first monthly interest P200,000 deducted.
- December 6, 2001 – Loan increased by P1,000,000 via Amendment of Deed of Mortgage under same terms.
- May 8, 2002 – Second Amendment of Deed of Mortgage for additional P2,000,000.
- Marilyn presented three corporate documents as authority:
• Board Resolution dated October 15, 2001
• Secretary’s Certificates dated December 6, 2001 and May 8, 2002, signed by corporate secretary Elizabeth Chamorro - Ricarcen defaulted; Calubad initiated extrajudicial foreclosure; auction on March 19, 2003; Calubad highest bidder; Certificate of Sale issued March 27, 2003; annotated on TCT April 10, 2003.
- Ricarcen learned of transactions July 2003; removed Marilyn; appointed Josefelix president; filed complaint September 9, 2003 for annulment of mortgage, foreclosure, sale, and damages.
Arguments of the Parties
- Ricarcen
• Marilyn never had authority to mortgage property or incur loans
• Presented corporate documents were fabricated; notarial acts untrue
• Did not knowingly benefit from loan proceeds; no ratification or laches - Calubad
• Acted in good faith; requ