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367 SCRA 222. February 6,2002


Nelson and Mercedez Baez, herein appelles, are the original owners of a parcel of land
together with its improvements located at White Plains, Q.C.(Q.C. Property) while
Alejandria Pineda is the owner of a house located at Los Angeles, California (California
Property), the two parties executed an Agreement to Exchange Real Properties. In the
agreement, they agreed to: 1) exchange their respective properties, 2) Pineda to pay an
earnest money of $ 12,000 on February 1983, and 3) to consummate the exchange of
properties not later than June 1983. It was agreed also that both should undertake to clear
the mortgages over their respective properties.

The Baezes were allowed to occupy or lease to a tenant the California property, and
Pineda was authorized to occupy the Q.C. property. Pursuant to the agreement, Pineda
paid the earnest money of $12,000, but the latter failed to clear the mortgages over her
California property. Later, unknown to the Baezes, Pineda and spouses Duque executed
an Agreement to Sell over the Q.C. property whereby Pineda sold the property to the
spouse Duque for 1.6 M. Payments were made by the Duques to Pineda which resulted
the former to occupy the Q.C. property.

When the apellees discovered such, they negotiated with the Duques since the latter were
interested in the property. Negotiations for the purchase of the property that was held
between them, but the same failed which resulted in the Baezes demanding for the
Duques to vacate the property and later led a case before the court.

Issue: Whether or not there was a valid contract of sale between Pineda and the Duques.

No. Pinedas sale of the property to the Duques was not authorized by the real owners of
the land -- the Baezes. The Civil Code provides that in a sale of a parcel of land or any
interest therein made through an agent, a special power of attorney is essential. This
authority must be in writing; otherwise the sale shall be void. In his testimony, Mr. Duque
conrmed that at the time he purchased the property from Pineda, the latter had no special
power of attorney to sell the property. A special power of attorney is necessary to enter into
any contract by which the ownership of an immovable is transmitted or acquired for a
valuable consideration. Without an authority in writing, Pineda could not validly sell the
property in question to the Duques. Hence, any sale in favor of the Duques is void.