Manila Memorial Park Cemetery, Inc. vs.
Linsangan
G.R. No. 151319 Nov 22, 2004
Facts:
In the case of "Manila Memorial Park Cemetery, Inc. v. Linsangan," the dispute revolves around the sale of
an interment space at the Holy Cross Memorial Park. The petitioner, Manila Memorial Park Cemetery, Inc.
(MMPCI), was represented by Florencia Baluyot. Baluyot offered Atty. Pedro L. Linsangan a lot called
Garden State, informing him that the previous owner of the lot under Contract No. 25012 had decided to
sell his rights, subject to reimbursement of the amounts already paid. The contract price was set at
P95,000.00. Linsangan accepted the offer and paid the initial down payment. Subsequently, Baluyot
informed Linsangan that he would be issued a new contract, Contract No. 28660, instead of the old
Contract No. 25012, but assured him that he would still pay the old price of P95,000.00. Linsangan signed
the new contract and issued postdated checks to MMPCI. However, Baluyot later advised Linsangan that
Contract No. 28660 was canceled and proposed a new purchase agreement, which Linsangan refused.
Consequently, Linsangan filed a Complaint for Breach of Contract and Damages against MMPCI and
Baluyot. The trial court found MMPCI and Baluyot jointly and severally liable, a decision affirmed by the
Court of Appeals. The Supreme Court, however, granted MMPCI's petition, ruling that MMPCI and its agent
were not jointly liable for breach of contract and damages.
Issue:
Did MMPCI ratify the actions of Baluyot, thereby binding itself to the terms agreed upon by
Baluyot and Linsangan?
Ruling:
The Court found that MMPCI did not ratify the actions of Baluyot, and thus, was not bound by the
terms agreed upon by Baluyot and Linsangan. The Supreme Court emphasized that persons dealing with
an agent must ascertain the fact of agency and the extent of the agent's authority. In this case, Atty.
Linsangan failed to verify whether Baluyot was authorized to agree to terms contrary to those in the
written contract. As a lawyer, Linsangan should have exercised greater caution, especially in dealings
involving legal documents. The Court noted that Baluyot's authority was limited to soliciting purchasers
and did not extend to altering contract terms. The Court also highlighted that MMPCI did not ratify
Baluyot's unauthorized acts, as ratification requires the principal's knowledge of the material facts, which
was not present in this case. Furthermore, the Court found no basis for estoppel, as there was no indication
that MMPCI allowed the public or Linsangan to believe that Baluyot had the authority to alter the standard
contracts. The Court concluded that the agreement between Baluyot and Linsangan bound only the two
of them and did not affect MMPCI. Therefore, MMPCI was not liable for the breach of contract and
damages claimed by Linsangan.
