Enforcing Land Purchase with Receipts and Changed Special Power of Attorney in the Philippines

Introduction

In the Philippine legal system, the purchase of land is governed by a complex interplay of civil law principles, particularly those under the Civil Code of the Philippines (Republic Act No. 386), the Property Registration Decree (Presidential Decree No. 1529), and related jurisprudence. A common scenario involves a buyer relying on receipts as proof of payment and a Special Power of Attorney (SPA) granted to an agent by the landowner. However, complications arise when the SPA is "changed"—which could mean amended, revoked, or superseded—potentially undermining the transaction's validity. This article comprehensively explores the mechanisms for enforcing such a land purchase, the evidentiary value of receipts, the implications of a changed SPA, available remedies, and procedural considerations, all within the Philippine context.

Legal Framework for Land Purchases

Under Article 1458 of the Civil Code, a contract of sale is perfected upon the meeting of minds on the object and price, even without delivery or payment. For immovable property like land, however, the contract must be in writing to be enforceable (Article 1403, par. 2(e)), often formalized through a Deed of Absolute Sale (DAS). If not notarized, it remains valid between parties but may not bind third persons until registered.

Land purchases frequently involve agents acting under an SPA, as per Article 1878 of the Civil Code, which requires a special power for acts like selling real property. The SPA must be in writing and, for real estate transactions, notarized to be effective against third parties (Article 1358). Registration with the Registry of Deeds is advisable for protection under the Torrens system.

Receipts serve as prima facie evidence of payment (Rule 130, Section 24 of the Revised Rules of Evidence). They can substantiate partial or full payment, invoking the principle of estoppel or unjust enrichment if the seller attempts to renege.

Role and Requirements of a Special Power of Attorney

An SPA is a written authorization allowing an agent to perform specific acts, such as negotiating and executing a land sale. It must explicitly grant authority to sell (Article 1878(5)), including details like property description, price range, and terms. Without specificity, the SPA may be deemed general and insufficient for real estate dispositions.

The principal can change the SPA at any time, as agency is revocable unless coupled with interest (Article 1920). Changes include:

Revocation: The principal notifies the agent and third parties (Article 1921). If not notified, acts done in good faith bind the principal (Article 1922).
Amendment: Modifying terms, such as reducing authority or altering price, requires a new or supplemental SPA.
Supersession: Issuing a new SPA to another agent, implicitly revoking the prior one if inconsistent.

A changed SPA does not automatically invalidate prior transactions unless the change precedes the sale's perfection. If the buyer deals with the agent post-change without knowledge, the transaction may still be enforceable if the buyer is in good faith.

Impact of a Changed SPA on Land Purchase Enforcement

When an SPA is changed after a purchase agreement but before execution or registration, the buyer faces hurdles:

If Change Occurs Before Perfection: The agent lacks authority, rendering the contract voidable or unenforceable against the principal (Article 1898). The buyer may sue the agent for damages under warranty of authority (Article 1897).
If Change Occurs After Perfection but Before Delivery: The contract remains valid if the buyer relied on the original SPA in good faith. The principal is estopped from denying the agent's authority if no timely notice was given.
Notice Requirement: Revocation or amendment must be communicated to the agent and known to the buyer. Constructive notice via registration (if the SPA was registered) or actual knowledge binds the buyer. Absent notice, the transaction stands (Heirs of Spouses Balite v. Lim, G.R. No. 152168, 2005).

Receipts bolster enforcement by proving consideration paid. If payments were made to the agent under the original SPA, the principal cannot retain benefits without honoring the sale, per unjust enrichment (Article 22).

Evidentiary Value of Receipts

Receipts are crucial in disputes involving changed SPAs:

Official Receipts vs. Provisional: Official receipts (e.g., from BIR-registered entities) carry higher weight, but even handwritten acknowledgments suffice if signed by the agent or principal.
As Proof of Contract: Multiple receipts showing progressive payments can imply a contract of sale, even without a formal deed (Article 1465 on installment sales).
Parol Evidence Rule: Receipts can introduce extrinsic evidence if the contract is ambiguous or incomplete (Rule 130, Section 9).

In court, receipts shift the burden to the seller to prove non-receipt or invalidity. Forged receipts, however, invalidate claims (People v. Reyes, G.R. No. 154159, 2005).

Remedies for Enforcement

Buyers can pursue several remedies under Philippine law:

Specific Performance: Compel the principal to execute the DAS and transfer title (Article 1191). Viable if the contract is valid and the buyer is ready to pay the balance. Courts favor this for unique properties like land (Limson v. CA, G.R. No. 135929, 2000).
Damages: For breach, including actual, moral, and exemplary damages if bad faith is proven (Article 2200). If the SPA change was malicious, additional liability arises.
Rescission: If the contract is rescissible due to lack of authority post-change (Article 1381), with mutual restitution.
Quiet Title or Reconveyance: If title was transferred to another, file an action to annul and reconvey based on prior rights.
Criminal Remedies: If fraud or estafa is involved (e.g., agent absconds with payments), file under Revised Penal Code Article 315.

Procedurally, file with the Regional Trial Court (RTC) having jurisdiction over the property's location. Prescription periods: 10 years for written contracts (Article 1144), 4 years for oral or injury-based claims (Article 1146).

Registration and Third-Party Rights

Under PD 1529, unregistered sales are binding only between parties. A buyer with receipts and an original SPA should register a notice of lis pendens during litigation to protect against innocent third-party purchasers.

If the principal sells to another after changing the SPA, the first buyer prevails if in good faith and first to register (Article 1544). Receipts help establish priority.

Jurisprudential Insights

Philippine courts emphasize good faith and equity:

In Domingo v. Domingo (G.R. No. L-30573, 1971), revocation without notice did not invalidate a sale to a good-faith buyer.
Veloso v. CA (G.R. No. 102737, 1993) upheld enforcement where payments were evidenced by receipts, despite agency issues.
Cases like Heirs of Dela Cruz v. CA (G.R. No. 117384, 1998) stress that changed SPAs do not retroactively void transactions if the principal ratified or benefited.

Practical Considerations and Preventive Measures

To mitigate risks:

Verify the SPA's authenticity and currency with the principal or through notarial records.
Insist on direct dealings or escrow for payments.
Secure a DAS promptly and register it.

Buyers should consult a lawyer early, as delays can lead to laches.

Conclusion

Enforcing a land purchase amid receipts and a changed SPA hinges on timing, notice, good faith, and evidence. While challenges exist, Philippine law provides robust protections through civil remedies and equitable principles, ensuring that valid transactions are upheld against arbitrary changes. Thorough documentation and prompt action are key to successful enforcement.