Special Power of Attorney for Sale of Inherited Property in the Philippines

I. Introduction

Inherited property in the Philippines is often owned by several heirs who live in different places. Some heirs may be abroad, elderly, unavailable, unable to travel, or simply unwilling to personally attend to the sale. In these situations, the heirs may execute a Special Power of Attorney, commonly called an SPA, authorizing a trusted representative to sell, sign, process, receive, or register documents involving inherited property.

An SPA is especially important when the property is still part of an estate, when title remains in the name of the deceased, when several heirs must sign an extrajudicial settlement or deed of sale, or when one heir is authorized to act for the others. However, an SPA is not a shortcut that automatically transfers ownership. It is only an authority document. The actual sale of inherited property must still comply with Philippine succession law, civil law, tax rules, land registration requirements, and the requirements of the Bureau of Internal Revenue, Registry of Deeds, Local Treasurer, Assessor’s Office, and other agencies.

A poorly drafted SPA can delay or invalidate a sale. A vague authority “to manage property” may not be enough to sell land. A general authority may not be enough to sign an extrajudicial settlement, receive sale proceeds, waive hereditary rights, mortgage property, or transfer title. If the SPA is executed abroad, it must also be properly acknowledged, consularized, or apostilled for use in the Philippines.

This article explains the legal and practical issues involving a Special Power of Attorney for the sale of inherited property in the Philippines.

II. What Is a Special Power of Attorney?

A Special Power of Attorney is a written authorization by which one person, called the principal, appoints another person, called the attorney-in-fact or agent, to perform specific acts on the principal’s behalf.

In the context of inherited property, an heir may authorize an attorney-in-fact to:

  1. Sell inherited property;
  2. Sign a deed of sale;
  3. Sign an extrajudicial settlement of estate;
  4. Sign tax forms;
  5. Process estate tax and capital gains tax;
  6. Receive a certificate authorizing registration;
  7. Register documents with the Registry of Deeds;
  8. Transfer tax declarations;
  9. Receive proceeds of sale;
  10. Represent the heir before government offices;
  11. Sign affidavits, forms, and related documents.

Because sale of real property is an important act of ownership, the authority must be clear and specific.

III. Why an SPA Is Needed for Sale of Inherited Property

An SPA is commonly needed when an heir or owner cannot personally sign or appear. In inherited property transactions, an SPA may be needed because:

  1. One or more heirs live abroad;
  2. One heir lives far from the property;
  3. The heirs want one person to handle all paperwork;
  4. The buyer wants fewer signatories during processing;
  5. An heir is elderly or physically unable to travel;
  6. The estate documents must be processed in several offices;
  7. The property is being sold before title is transferred to the heirs;
  8. The heirs are executing a combined extrajudicial settlement and sale;
  9. The heir cannot personally receive sale proceeds;
  10. The Registry of Deeds, BIR, or buyer requires clear authority.

Without an SPA, a representative may lack authority to bind the heir.

IV. SPA Versus Deed of Sale

An SPA does not itself sell the property. It only authorizes someone to sell or sign documents. The actual transfer is made by a Deed of Sale, Deed of Extrajudicial Settlement with Sale, Deed of Partition with Sale, or another appropriate conveyance.

For example:

  • The SPA says: “I authorize my brother to sell my share.”
  • The deed says: “The heirs hereby sell the property to the buyer.”

The SPA gives authority. The deed performs the sale.

V. SPA Versus Extrajudicial Settlement

An SPA is also different from an Extrajudicial Settlement of Estate.

An extrajudicial settlement is the document by which heirs settle and divide the estate of a deceased person without court proceedings, if legally allowed.

An SPA may authorize an attorney-in-fact to sign the extrajudicial settlement on behalf of an heir. But the SPA itself does not settle the estate unless it is incorporated into a proper settlement document and the authorized representative signs the settlement under valid authority.

VI. SPA Versus Waiver of Hereditary Rights

An SPA authorizing sale should not be confused with a waiver of inheritance. A waiver or renunciation of hereditary rights is a separate act and must be clearly and lawfully made.

If an heir intends only to authorize someone to sell the heir’s share, the SPA should say that. If the heir intends to waive rights in favor of another heir, the document must be drafted differently and with caution.

An attorney-in-fact should not waive an heir’s inheritance unless the SPA specifically grants that power.

VII. SPA Versus Authority to Receive Money

An SPA to sell does not always automatically include authority to receive the purchase price. For safety, the SPA should expressly state whether the attorney-in-fact may:

  1. Receive earnest money;
  2. Receive down payment;
  3. Receive full purchase price;
  4. Sign acknowledgment receipts;
  5. Deposit proceeds into a bank account;
  6. Issue receipts;
  7. Divide proceeds among heirs;
  8. Deduct taxes and expenses;
  9. Accept manager’s checks or bank transfers.

If the principal wants proceeds paid directly to the principal, the SPA should say so.

VIII. Why Inherited Property Transactions Are More Complicated

Selling inherited property is more complicated than selling ordinary property because the registered owner may already be dead, and the heirs must first establish their right to transfer.

Common complications include:

  1. Title still in the name of the deceased;
  2. Estate tax not yet paid;
  3. Several heirs must agree;
  4. Some heirs are abroad;
  5. There are minor heirs;
  6. There are missing heirs;
  7. There are illegitimate children;
  8. There are surviving spouse property rights;
  9. There are debts of the estate;
  10. There are disputes among heirs;
  11. There are existing mortgages or liens;
  12. There are unpaid real property taxes;
  13. There are restrictions on title;
  14. The deceased left no will;
  15. There is a pending court settlement;
  16. The property is co-owned with non-heirs.

An SPA solves only the representation problem. It does not solve title, tax, succession, or heirship issues by itself.

IX. Who May Execute the SPA?

The SPA may be executed by any person who has a right or interest in the inherited property and has legal capacity.

Common principals include:

  1. An heir;
  2. A surviving spouse;
  3. A co-owner;
  4. A devisee or legatee under a will;
  5. An administrator or executor, if authorized by court or law;
  6. A buyer authorizing someone to process purchase documents;
  7. A corporation or entity that inherited or acquired rights, through authorized officers.

For ordinary inherited family property, the principals are usually the heirs and surviving spouse.

X. Who May Be Appointed as Attorney-in-Fact?

The attorney-in-fact may be:

  1. A sibling;
  2. A co-heir;
  3. A parent or child;
  4. A spouse;
  5. A trusted relative;
  6. A lawyer;
  7. A real estate broker;
  8. A buyer’s representative;
  9. A professional processor;
  10. Another trusted adult.

The person appointed should be trustworthy, competent, available, and willing to handle government processing.

Because the attorney-in-fact may sign important documents and receive money, the choice is critical.

XI. Can One Heir Represent All Heirs?

Yes, if all heirs properly authorize that heir through valid SPAs. One heir cannot automatically sign for all others merely because he or she is the eldest, lives near the property, paid taxes, or is the one negotiating with the buyer.

Each heir who will not personally sign should execute a separate SPA or sign a joint SPA authorizing the same attorney-in-fact.

XII. Can One SPA Cover Several Heirs?

Yes. Several heirs may sign one SPA appointing the same attorney-in-fact, provided all signatories are properly identified and their signatures are properly acknowledged.

However, if heirs are in different countries or cities, separate SPAs may be more practical.

XIII. Can an Heir Abroad Execute an SPA?

Yes. An heir abroad may execute an SPA for use in the Philippines. The SPA must be properly executed according to requirements for foreign-executed documents.

The usual options are:

  1. Execute and acknowledge the SPA before a Philippine embassy or consulate; or
  2. Execute before a foreign notary or competent authority and obtain an apostille, if applicable.

If the country is not covered by apostille procedures for Philippine use, consular authentication may be required.

XIV. Consularized SPA

A consularized SPA is signed or acknowledged before a Philippine consular officer abroad. It is commonly accepted in the Philippines because the Philippine consular officer performs notarial or acknowledgment functions for documents to be used in the Philippines.

The SPA should bear the consular seal and proper acknowledgment.

XV. Apostilled SPA

An apostilled SPA is typically signed before a foreign notary or authorized officer and then authenticated through an apostille issued by the competent authority of the foreign country.

The apostille authenticates the origin of the public document, such as the notary’s signature and authority. It does not guarantee that the SPA is substantively valid under Philippine law. The SPA must still contain the proper authority required for the transaction.

XVI. Red Ribbon Authentication

Older practice referred to “red ribbon” authentication. In many countries, this has been replaced by apostille. Some people still use “red ribbon” informally to mean authentication of foreign documents. The important point is whether the document is properly authenticated or apostilled for use in the Philippines.

XVII. SPA Executed in the Philippines

If executed in the Philippines, the SPA should be notarized before a Philippine notary public. For real property transactions, notarization is essential because agencies usually require a public instrument.

A privately signed, unnotarized SPA may be rejected by the BIR, Registry of Deeds, buyer, bank, or local government.

XVIII. Formal Requirements of an SPA

A good SPA should include:

  1. Title: Special Power of Attorney;
  2. Date and place of execution;
  3. Full name of principal;
  4. Citizenship of principal;
  5. Civil status of principal;
  6. Address of principal;
  7. Valid identification details;
  8. Full name of attorney-in-fact;
  9. Citizenship, civil status, and address of attorney-in-fact;
  10. Specific property description;
  11. Title number or tax declaration number;
  12. Description of authority granted;
  13. Authority to sign specific documents;
  14. Authority to receive or not receive proceeds;
  15. Authority to pay taxes and fees;
  16. Authority to represent before agencies;
  17. Signature of principal;
  18. Witnesses, if used;
  19. Notarial acknowledgment or consular acknowledgment;
  20. Apostille, if executed before foreign notary.

The more specific the SPA, the fewer problems during processing.

XIX. Property Description in the SPA

The SPA should identify the inherited property clearly. For titled land, include:

  1. Transfer Certificate of Title or Original Certificate of Title number;
  2. Lot number;
  3. Survey number;
  4. Location;
  5. Area;
  6. Registered owner;
  7. Registry of Deeds;
  8. Tax declaration number;
  9. Technical description, if needed.

For condominium property, include:

  1. Condominium Certificate of Title number;
  2. Unit number;
  3. Building or project name;
  4. Floor;
  5. Area;
  6. Parking slot title, if included;
  7. Registry of Deeds.

For untitled property, include:

  1. Tax declaration number;
  2. Location;
  3. Area;
  4. Boundaries;
  5. Declared owner;
  6. Possessory documents;
  7. Other identifying records.

Avoid vague descriptions such as “our property in the province” or “the inherited land of my parents.”

XX. Authority to Sell Must Be Express

The SPA should expressly state that the attorney-in-fact is authorized to sell. A general authority “to manage,” “to process,” or “to administer” may not be enough.

The SPA should include language such as:

  1. To sell, convey, transfer, and dispose of the principal’s hereditary share or interest;
  2. To negotiate and agree on the purchase price;
  3. To sign the deed of sale;
  4. To sign the extrajudicial settlement with sale;
  5. To sign all documents necessary to complete the transfer.

Sale of real property is not an ordinary act of administration. It requires special authority.

XXI. Authority to Sign Extrajudicial Settlement

If the title remains in the name of the deceased, the heirs usually need to settle the estate before or together with the sale. The SPA should expressly authorize the attorney-in-fact to sign:

  1. Extrajudicial Settlement of Estate;
  2. Extrajudicial Settlement with Sale;
  3. Deed of Adjudication, if sole heir;
  4. Deed of Partition;
  5. Affidavit of Self-Adjudication;
  6. Other estate settlement documents.

If the SPA authorizes only sale but not estate settlement, the BIR or Registry of Deeds may require a revised SPA.

XXII. Authority to Execute Deed of Extrajudicial Settlement With Sale

Many inherited properties are sold through a single document called Extrajudicial Settlement of Estate with Sale. This document both settles the estate and sells the property to the buyer.

If the attorney-in-fact will sign this document, the SPA should specifically authorize:

  1. Settlement of the estate;
  2. Recognition of the principal’s share;
  3. Sale of the principal’s share;
  4. Signing of the deed;
  5. Receipt of proceeds, if allowed;
  6. Processing with BIR and Registry of Deeds.

A vague SPA may be rejected.

XXIII. Authority to Receive Sale Proceeds

The SPA should state whether the attorney-in-fact may receive payment. If yes, it should specify the form of payment:

  1. Cash;
  2. Manager’s check;
  3. Bank transfer;
  4. Check payable to principal;
  5. Check payable to attorney-in-fact;
  6. Deposit into designated account;
  7. Escrow arrangement.

For safety, many principals prefer that payment be made directly to their bank account or through a manager’s check payable to the principal.

XXIV. Authority to Negotiate Price

If the attorney-in-fact will negotiate the sale price, the SPA may grant authority to agree on terms. However, the principal may also set limits.

For example, the SPA may state:

  1. Minimum selling price;
  2. Required down payment;
  3. Deadline for payment;
  4. Prohibited terms;
  5. Requirement that proceeds be paid directly to principal;
  6. Requirement of written approval before final sale.

A clear price limit reduces the risk of unauthorized undervaluation.

XXV. Authority to Pay Taxes and Expenses

The SPA should authorize the attorney-in-fact to pay or process:

  1. Estate tax;
  2. Capital gains tax, if applicable;
  3. Documentary stamp tax;
  4. Transfer tax;
  5. Registration fees;
  6. Real property tax;
  7. Penalties and surcharges;
  8. Assessor’s fees;
  9. Publication expenses;
  10. Notarial fees;
  11. Processing expenses.

The SPA may also state whether the attorney-in-fact may deduct these expenses from sale proceeds.

XXVI. Authority to Deal With the BIR

Sale of inherited property almost always involves the Bureau of Internal Revenue. The SPA should authorize the attorney-in-fact to:

  1. File estate tax returns;
  2. File capital gains tax returns;
  3. File documentary stamp tax returns;
  4. Sign BIR forms;
  5. Submit documents;
  6. Pay taxes and penalties;
  7. Receive assessment notices;
  8. Receive eCAR or CAR;
  9. Respond to BIR requirements;
  10. Request certifications or rulings where needed.

BIR offices may require a specific SPA before allowing a representative to transact.

XXVII. Authority to Deal With the Registry of Deeds

The SPA should authorize the attorney-in-fact to:

  1. Present documents for registration;
  2. Surrender owner’s duplicate title;
  3. Sign registration forms;
  4. Pay registration fees;
  5. Receive new title or certified copies;
  6. Follow up registration;
  7. Correct minor registration issues;
  8. Sign affidavits required by the Registry.

If the attorney-in-fact will receive the new title, the SPA should expressly allow it.

XXVIII. Authority to Deal With the Local Treasurer

Local transfer tax and real property tax clearance are usually handled at the city or municipal treasurer’s office. The SPA should authorize the attorney-in-fact to:

  1. Secure real property tax clearance;
  2. Pay real property tax arrears;
  3. Pay local transfer tax;
  4. Secure official receipts;
  5. Request tax certifications.

XXIX. Authority to Deal With the Assessor’s Office

After registration, the tax declaration must be updated. The SPA may authorize the attorney-in-fact to:

  1. Transfer tax declaration;
  2. Cancel old tax declaration;
  3. Secure new tax declaration;
  4. Sign assessor’s forms;
  5. Submit title and deed copies;
  6. Pay assessor-related fees.

XXX. Authority to Represent Before Banks

If payment will be made through bank instruments, or if the title is mortgaged, the SPA may need authority to deal with banks.

The attorney-in-fact may need authority to:

  1. Receive manager’s checks;
  2. Deposit proceeds;
  3. Open or access escrow, if allowed;
  4. Obtain loan payoff amounts;
  5. Coordinate release of mortgage;
  6. Receive documents from bank;
  7. Sign bank forms.

Banks may have their own SPA format or require personal appearance.

XXXI. Authority to Sign Receipts and Acknowledgments

If the attorney-in-fact will receive money or documents, the SPA should authorize signing of:

  1. Acknowledgment receipt;
  2. Deed of absolute sale acknowledgment;
  3. Receipt of earnest money;
  4. Receipt of down payment;
  5. Receipt of full payment;
  6. Turnover certificate;
  7. Delivery acknowledgment;
  8. Clearance forms.

Without express authority, buyers may hesitate to pay the attorney-in-fact.

XXXII. Authority to Deliver Possession

If the attorney-in-fact will turn over the property, keys, or possession, the SPA may include authority to:

  1. Deliver physical possession;
  2. Sign turnover documents;
  3. Coordinate with tenants or occupants;
  4. Terminate or assign leases, if allowed;
  5. Receive or return security deposits;
  6. Turn over keys, utilities, and documents.

This is important for houses, condominiums, rental properties, and commercial spaces.

XXXIII. Authority to Sign Corrective Documents

Government agencies may require minor corrections, affidavits, or supplemental documents. The SPA may authorize the attorney-in-fact to sign:

  1. Affidavit of discrepancy;
  2. Affidavit of one and the same person;
  3. Affidavit of loss;
  4. Undertaking;
  5. Supplemental deed;
  6. Correction forms;
  7. Declarations and certifications.

However, major changes should not be made without the principal’s approval.

XXXIV. Authority to Substitute or Delegate

The principal may or may not allow the attorney-in-fact to appoint another person. If delegation is allowed, the SPA should say so.

Delegation can be useful if the attorney-in-fact cannot personally attend to all offices. But it can be risky because authority may pass to a person the principal does not know.

If allowed, the SPA may say the attorney-in-fact may appoint a substitute only for ministerial processing, not for signing the sale deed or receiving proceeds.

XXXV. Authority to Mortgage Is Different From Authority to Sell

If the attorney-in-fact is authorized to sell, that does not automatically mean authority to mortgage. If mortgage, loan, or encumbrance is contemplated, it must be specifically stated.

For sale of inherited property, avoid giving unnecessary authority to mortgage unless truly intended.

XXXVI. Authority to Donate Is Different From Authority to Sell

Authority to sell does not include authority to donate. If the attorney-in-fact donates property without authority, the act may be invalid or contestable.

Inherited property sale SPAs should not include donation authority unless specifically intended.

XXXVII. Authority to Partition

Before sale, heirs may need to partition the estate. The SPA should authorize partition if needed.

Partition authority may include:

  1. Agreeing on shares;
  2. Signing deed of partition;
  3. Accepting allocation of specific property;
  4. Selling after partition;
  5. Receiving proceeds.

If the principal does not want the attorney-in-fact to alter shares, the SPA should limit authority.

XXXVIII. Authority to Compromise

If there is a dispute among heirs or with third parties, compromise authority must be specific. An attorney-in-fact cannot settle major disputes, reduce shares, waive claims, or accept settlement without clear authority.

For inherited property transactions, compromise authority should be granted cautiously.

XXXIX. Authority to Sign Tax Declarations Is Not Authority to Sell

Some people think that if one heir has been paying real property tax or signing tax documents, that heir can sell the property. This is incorrect.

Payment of taxes does not prove exclusive ownership and does not authorize sale of co-heirs’ shares. A proper SPA is still needed.

XL. Authority of Administrator or Executor

If the estate is under court settlement, an administrator or executor may have authority to manage estate property, but sale of estate property may still require court approval depending on the circumstances.

An heir’s SPA may not be enough if the property is under estate proceedings and court supervision.

XLI. If There Is a Will

If the deceased left a will, the property may need probate before distribution. An SPA from heirs may not be enough if the will has not been probated and the estate is not settled.

The representative should verify whether the property is subject to testamentary proceedings.

XLII. If There Is No Will

If there is no will, the heirs may settle the estate extrajudicially if legal requirements are met. In that case, SPAs may be used by heirs who cannot personally sign.

The extrajudicial settlement must still comply with publication, bond requirements where applicable, tax payments, and registration.

XLIII. Extrajudicial Settlement Requirements

For an extrajudicial settlement, common requirements include:

  1. The deceased left no will;
  2. There are no debts, or debts are settled;
  3. Heirs are all of legal age, or minors are properly represented;
  4. Heirs agree on settlement;
  5. The deed is in a public instrument;
  6. The deed is published as required;
  7. Estate tax is settled;
  8. The deed is registered with the Registry of Deeds if real property is involved.

If these are not satisfied, court settlement may be required.

XLIV. SPA for Sole Heir

If there is only one heir, the heir may execute an affidavit of self-adjudication. If the sole heir is abroad or unavailable, an SPA may authorize an attorney-in-fact to sign and process the self-adjudication and sale.

The SPA should specifically authorize:

  1. Execution of affidavit of self-adjudication;
  2. Sale of inherited property;
  3. Filing estate tax;
  4. Registration with Registry of Deeds;
  5. Receipt of proceeds, if allowed.

XLV. SPA Where There Are Multiple Heirs

If there are multiple heirs, each heir must either sign personally or authorize someone. The attorney-in-fact may sign for one heir, several heirs, or all heirs, depending on the SPAs.

If even one required heir does not sign or authorize, the sale may cover only the shares of those who signed, unless later ratified.

XLVI. SPA for Minor Heirs

If an heir is a minor, a parent or guardian cannot automatically sell the minor’s inherited property without legal requirements. Sale of a minor’s property may require court approval or guardianship authority.

An SPA signed by a parent for a minor may not be enough. This is a serious issue.

If the estate includes minor heirs, consult legal counsel before selling.

XLVII. SPA for Incapacitated Heirs

If an heir is mentally incapacitated, elderly with impaired capacity, under guardianship, or otherwise unable to consent, a simple SPA may not be valid. A guardian or court authority may be required.

Capacity must exist at the time of signing the SPA.

XLVIII. SPA for Heirs Who Cannot Sign

If an heir cannot physically sign but has mental capacity, special signing formalities may be needed, such as signature by mark, assistance, witnesses, or notarization confirming voluntariness.

The notary or consular officer must be satisfied that the principal understands the document.

XLIX. SPA for Illiterate Principals

If the principal cannot read the SPA, the document should be read and explained in a language the principal understands. The acknowledgment should reflect that the principal understood and voluntarily executed the document.

This reduces the risk of later claims of fraud or undue influence.

L. SPA and Spousal Consent

An heir’s spouse may need to participate depending on the nature of the property and the heir’s rights.

Inherited property is generally separate or exclusive to the heir, but proceeds, improvements, or marital property regime issues may complicate matters. Also, if the heir is selling a share acquired by inheritance, some buyers and registries may require the spouse’s conformity to avoid future claims.

If the heir is married, the SPA should disclose civil status. The spouse may sign conformity if necessary.

LI. Surviving Spouse as Heir and Co-Owner

The surviving spouse may have rights in two capacities:

  1. As owner of share in the conjugal or community property; and
  2. As heir of the deceased.

If the property belonged to the marital partnership or community, the surviving spouse’s participation is essential. Other heirs cannot sell the entire property without the surviving spouse.

LII. Inherited Property Registered as “Married To”

A title may show the deceased as “Juan Santos married to Maria Santos.” This does not automatically mean Maria owns half, but it signals possible marital property issues.

Before sale, determine whether the property was:

  1. Exclusive property of the deceased;
  2. Conjugal property;
  3. Community property;
  4. Co-owned with spouse;
  5. Acquired before marriage;
  6. Acquired by inheritance or donation;
  7. Acquired during marriage.

The SPA and sale documents should reflect the correct ownership.

LIII. Sale of Hereditary Share Before Partition

An heir may sell hereditary rights or share before partition, but sale of a specific property may be problematic if the estate has not been partitioned and other heirs have rights.

A buyer should know whether he or she is buying:

  1. A specific property after settlement;
  2. An undivided share in the estate;
  3. Hereditary rights;
  4. Rights subject to partition;
  5. Property after extrajudicial settlement with sale.

The SPA should match the intended transaction.

LIV. Sale of Undivided Share

If one heir sells only his or her share, the buyer becomes a co-owner with the other heirs or co-owners. The SPA should specify that only the principal’s share is being sold.

If the buyer expects the entire property, all heirs and co-owners must sign or authorize the sale.

LV. Sale of Entire Property

To sell the entire inherited property, all owners or heirs must participate. This may include:

  1. Surviving spouse;
  2. Legitimate children;
  3. Illegitimate children;
  4. Parents, if applicable;
  5. Other compulsory heirs;
  6. Collateral relatives, if applicable;
  7. Devisees or legatees;
  8. Co-owners.

Missing heirs create title risk.

LVI. Illegitimate Children and SPA

Illegitimate children may have inheritance rights. They cannot be ignored simply because they are not listed on the title or were not close to the family.

If an illegitimate child is an heir, that heir must participate or authorize the sale. Failure to include a compulsory heir may cause future disputes.

LVII. Heirs Abroad

When heirs are abroad, each should execute a properly authenticated or apostilled SPA. The document should use names matching passports and Philippine civil registry records.

Common issues include:

  1. Married name abroad differs from Philippine birth name;
  2. Missing middle name;
  3. Different citizenship;
  4. Different passport spelling;
  5. Use of foreign characters or suffixes;
  6. Change of name after naturalization.

Affidavits or supporting documents may be needed.

LVIII. Former Filipino Heirs

A former Filipino heir who has become a foreign citizen may still inherit Philippine property, subject to legal rules. The SPA should accurately state current citizenship and identity.

If the heir is selling inherited land, the heir’s current citizenship may affect buyer due diligence but generally does not prevent sale of inherited rights already acquired.

LIX. Foreign Heirs

Foreign heirs may inherit in certain circumstances, subject to Philippine law and constitutional restrictions. Selling inherited property may require careful handling, especially if the foreign heir cannot retain land ownership except through succession.

The SPA should be carefully drafted and supported by proof of heirship.

LX. Buyer’s Due Diligence

A buyer dealing with an attorney-in-fact should verify:

  1. Original SPA;
  2. Notarization, apostille, or consular acknowledgment;
  3. Principal’s identity;
  4. Attorney-in-fact’s identity;
  5. Property description;
  6. Authority to sell;
  7. Authority to receive payment;
  8. Whether all heirs are represented;
  9. Whether estate is settled;
  10. Whether taxes are paid;
  11. Whether title is clean;
  12. Whether there are minors or missing heirs;
  13. Whether the SPA is still valid and unrevoked.

The buyer should not rely on photocopies alone for a major transaction.

LXI. BIR Requirements for SPA

The BIR may require an SPA when someone other than the taxpayer or heir files documents or transacts.

Common BIR requirements may include:

  1. Original notarized, consularized, or apostilled SPA;
  2. Valid IDs of principal and attorney-in-fact;
  3. TIN of principal and heirs;
  4. Death certificate of deceased;
  5. Tax returns;
  6. Deed of sale or settlement;
  7. Title;
  8. Tax declarations;
  9. Proof of relationship;
  10. Other supporting documents.

BIR may reject a vague SPA that does not authorize tax filing or receipt of CAR/eCAR.

LXII. Registry of Deeds Requirements for SPA

The Registry of Deeds may require:

  1. Original SPA or certified copy acceptable for registration;
  2. Proper acknowledgment;
  3. Apostille or consularization if executed abroad;
  4. Clear authority to sell and sign deed;
  5. Property description matching title;
  6. IDs;
  7. BIR CAR/eCAR;
  8. Owner’s duplicate title;
  9. Transfer tax receipt;
  10. Estate settlement documents.

The Registry may reject an SPA if authority is unclear.

LXIII. Owner’s Duplicate Title

To register a voluntary sale, the owner’s duplicate certificate of title is usually required. An SPA may authorize the attorney-in-fact to surrender the title.

If the title is lost, a separate petition for replacement may be needed. An SPA cannot replace a lost owner’s duplicate title.

LXIV. Title Still in Name of Deceased

If the title remains in the name of the deceased, the heirs cannot simply execute a standard deed of sale as if they were already registered owners. The transaction usually requires estate settlement and tax clearance.

A common document is an Extrajudicial Settlement of Estate with Sale, signed by the heirs or their attorneys-in-fact.

LXV. Estate Tax

Before inherited property can be transferred, estate tax issues must be addressed. The estate tax is imposed on the transfer of the deceased person’s estate.

The SPA may authorize the attorney-in-fact to:

  1. File estate tax return;
  2. Submit estate documents;
  3. Pay estate tax;
  4. Pay penalties, if any;
  5. Receive estate tax clearance or eCAR;
  6. Sign supporting forms.

If estate tax is unpaid, registration of sale may be delayed.

LXVI. Capital Gains Tax and Documentary Stamp Tax

If inherited property is sold, taxes related to the sale may include capital gains tax and documentary stamp tax, depending on the transaction.

The SPA should authorize the attorney-in-fact to sign tax returns, pay taxes, and secure the certificate authorizing registration.

LXVII. Local Transfer Tax

After BIR processing, local transfer tax is usually paid to the city or municipality where the property is located. The SPA should authorize payment and processing.

LXVIII. Real Property Tax Clearance

Unpaid real property taxes must usually be settled before transfer. The SPA should authorize the attorney-in-fact to secure tax clearance and pay arrears.

LXIX. Publication Requirement for Extrajudicial Settlement

Extrajudicial settlement must generally be published in a newspaper of general circulation once a week for three consecutive weeks. The SPA may authorize the attorney-in-fact to arrange publication and pay publication fees.

Publication does not replace the need for all heirs to participate.

LXX. Bond Requirement

In certain extrajudicial settlement situations involving personal property, a bond may be required. For real property, the annotation of settlement may protect creditors and heirs for a statutory period. Legal advice is recommended where estate debts or minor heirs exist.

LXXI. Two-Year Rule and Claims Against Estate

Extrajudicial settlement may be subject to claims by creditors or omitted heirs within a legal period. Buyers should understand that inherited property transfers may carry risks if the estate settlement was incomplete or defective.

A properly drafted SPA does not eliminate omitted-heir risk.

LXXII. SPA Validity Period

An SPA may specify a validity period. If no period is stated, it may remain effective until revoked, the agency is extinguished, or the purpose is completed, subject to legal rules.

For practical purposes, government agencies and buyers may prefer a recently executed SPA, especially for real property transactions.

If the SPA is old, the buyer or Registry may require confirmation that it has not been revoked.

LXXIII. Revocation of SPA

The principal may generally revoke the SPA, subject to legal limitations and rights of third parties. Revocation should be made in writing and communicated to the attorney-in-fact, buyer, and relevant parties.

If the SPA has been registered or relied upon, formal notice may be necessary.

A buyer should confirm that the SPA remains valid at the time of sale.

LXXIV. Death of Principal

The death of the principal generally extinguishes agency, subject to legal exceptions. If an heir who executed the SPA dies before the sale is completed, the attorney-in-fact’s authority may end, and the deceased heir’s own heirs may need to participate.

This can complicate inherited property sales.

LXXV. Death of Attorney-in-Fact

If the attorney-in-fact dies, the SPA can no longer be used. The principal must appoint another attorney-in-fact if still needed.

LXXVI. Incapacity After SPA Execution

If the principal becomes incapacitated after executing the SPA, the continued validity of the agency may become legally sensitive. Buyers and agencies may require updated authority or court involvement depending on the circumstances.

LXXVII. Conflict of Interest

The attorney-in-fact may have a conflict of interest if he or she is also:

  1. The buyer;
  2. A co-heir receiving larger proceeds;
  3. A broker earning commission;
  4. A person indebted to the estate;
  5. A person controlling the property;
  6. A person with adverse claim.

If the attorney-in-fact will sell to himself or herself, the SPA must expressly authorize self-dealing, and even then, the transaction may be scrutinized.

LXXVIII. Attorney-in-Fact Selling to Himself

An agent generally should not buy the property he or she is authorized to sell unless the principal clearly consents and the law allows it. This is a conflict-of-interest situation.

If intended, the SPA must be very clear. The principal should understand the price, terms, and conflict.

LXXIX. Broker as Attorney-in-Fact

A real estate broker may be appointed as attorney-in-fact, but the principal should distinguish between:

  1. Authority to market the property;
  2. Authority to negotiate;
  3. Authority to sign sale documents;
  4. Authority to receive proceeds.

Giving a broker full authority to sell and receive money requires high trust and careful safeguards.

LXXX. Buyer as Attorney-in-Fact

A buyer should generally not be attorney-in-fact of the seller unless necessary and carefully documented. It creates conflict and may invite later challenges.

If the buyer is authorized only to process documents after the sale, the SPA should be limited and should not allow self-serving changes.

LXXXI. Safeguards for Principals

An heir executing an SPA should protect himself or herself by:

  1. Naming a trusted attorney-in-fact;
  2. Stating minimum sale price;
  3. Requiring direct payment to principal’s bank account;
  4. Limiting authority to specific property;
  5. Prohibiting self-dealing unless intended;
  6. Requiring accounting of proceeds;
  7. Requiring copies of all documents;
  8. Setting expiration date;
  9. Requiring written approval for major decisions;
  10. Avoiding blank documents.

Do not sign blank SPAs or blank deeds.

LXXXII. Safeguards for Buyers

A buyer should protect himself or herself by:

  1. Reviewing original SPA;
  2. Verifying acknowledgment or apostille;
  3. Checking IDs;
  4. Confirming with principal if possible;
  5. Ensuring all heirs are included;
  6. Confirming authority to sell and receive payment;
  7. Paying by traceable method;
  8. Avoiding payment to unauthorized persons;
  9. Requiring tax and title documents;
  10. Consulting counsel for high-value property.

A buyer who pays an unauthorized representative may have difficulty recovering money.

LXXXIII. Safeguards for Co-Heirs

Co-heirs should:

  1. Review SPA terms;
  2. Agree on sale price;
  3. Agree on expense sharing;
  4. Agree on distribution of proceeds;
  5. Require accounting;
  6. Keep copies of all documents;
  7. Monitor tax processing;
  8. Ensure no heir is excluded;
  9. Clarify who receives payment;
  10. Document all agreements.

Family trust is useful, but written records prevent disputes.

LXXXIV. Common SPA Clauses

A good SPA for sale of inherited property may include authority:

  1. To represent the principal as heir;
  2. To sign extrajudicial settlement of estate;
  3. To sell the principal’s share or the inherited property;
  4. To negotiate price and terms;
  5. To sign deed of sale or settlement with sale;
  6. To receive proceeds or direct payment;
  7. To sign tax returns and BIR forms;
  8. To pay taxes and fees;
  9. To receive CAR/eCAR;
  10. To register documents with Registry of Deeds;
  11. To transfer tax declaration;
  12. To sign affidavits and supporting documents;
  13. To receive documents and titles;
  14. To do all acts necessary to complete the sale.

However, broad “do all acts” language should support specific authority, not replace it.

LXXXV. Sample SPA Authority Language

A sale authority clause may state:

“To sell, convey, transfer, and dispose of my rights, interests, participation, and hereditary share in the property covered by Transfer Certificate of Title No. _____, located at _____, including authority to negotiate and agree on the purchase price and terms, sign the Deed of Sale or Extrajudicial Settlement of Estate with Sale, and execute all documents necessary to complete the transaction.”

A tax authority clause may state:

“To represent me before the Bureau of Internal Revenue, Local Treasurer, Assessor’s Office, Registry of Deeds, and all government offices; to sign, submit, and receive documents; to pay taxes, fees, penalties, and charges; and to receive the Certificate Authorizing Registration or electronic Certificate Authorizing Registration.”

A proceeds clause may state:

“To receive my share in the purchase price and sign receipts therefor.”

Or, if proceeds should be paid directly:

“The attorney-in-fact is not authorized to receive my share of the purchase price, which shall be paid directly to my bank account or by manager’s check payable to me.”

LXXXVI. Need for Clear Limits

The SPA may limit authority by:

  1. Property;
  2. Transaction;
  3. Price;
  4. Buyer;
  5. Duration;
  6. Payment method;
  7. Documents to be signed;
  8. Power to receive money;
  9. Power to compromise;
  10. Power to delegate.

Clear limits reduce misuse.

LXXXVII. SPA With Minimum Selling Price

The principal may state that the property cannot be sold below a certain amount. This protects the heir from unauthorized low-price sales.

However, if the SPA will be submitted to the buyer, revealing the minimum price may affect negotiation. In some cases, price limits are handled in separate private instructions.

LXXXVIII. Private Instructions to Attorney-in-Fact

The principal may issue separate written instructions to the attorney-in-fact, such as how to divide proceeds or negotiate price. However, third parties may rely on the SPA. If the principal wants limits enforceable against third parties, the limits should appear in the SPA.

LXXXIX. SPA and Undervaluation

Some parties understate the selling price to reduce taxes. This is risky and unlawful if it misrepresents the true transaction. The SPA should not authorize false declarations.

The deed and tax filings should reflect the true consideration and comply with valuation rules.

XC. SPA and Tax Evasion Risk

An attorney-in-fact who signs false tax documents may expose the principal and himself or herself to tax and legal consequences. The principal should ensure that the representative files truthful returns.

XCI. SPA and Receipt of Cash

Cash payments are risky. They can create disputes over whether the attorney-in-fact received, divided, or misappropriated proceeds.

Traceable payment methods such as manager’s checks, bank transfers, or escrow are safer.

XCII. SPA and Escrow

For high-value inherited property, an escrow arrangement may protect both buyer and heirs. The SPA may authorize the attorney-in-fact to coordinate escrow but should specify payment conditions.

XCIII. SPA and Real Estate Broker’s Commission

If a broker is involved, the SPA should not automatically authorize payment of commission unless agreed. Broker commission should be documented separately.

Heirs should agree who pays commission and from what proceeds.

XCIV. SPA and Taxes Paid by Buyer

In some sales, the buyer agrees to shoulder taxes. In others, the seller pays capital gains tax and the buyer pays documentary stamp tax or transfer expenses. The SPA may authorize the attorney-in-fact to agree on allocation, or the principal may require prior approval.

The deed should state who shoulders each expense.

XCV. SPA and Sale Subject to Mortgage

If inherited property is mortgaged, the SPA should authorize dealing with the mortgagee if necessary. The attorney-in-fact may need authority to:

  1. Request statement of account;
  2. Pay loan balance;
  3. Secure release of mortgage;
  4. Receive cancelled title;
  5. Sign documents related to mortgage cancellation;
  6. Sell subject to mortgage if allowed.

Mortgage restrictions must be checked.

XCVI. SPA and Property With Tenants

If the property has tenants, the SPA may authorize the attorney-in-fact to:

  1. Notify tenants of sale;
  2. Assign lease rights;
  3. Receive rent until sale;
  4. Turn over lease deposits;
  5. Deliver possession to buyer;
  6. Sign tenant-related documents.

If tenants have rights, the buyer should be informed.

XCVII. SPA and Occupied Property

If relatives or informal occupants live on the property, the SPA should clarify whether the attorney-in-fact may negotiate vacating, sign turnover documents, or handle relocation arrangements.

Sale of occupied inherited property can create conflict.

XCVIII. SPA and Agricultural Land

If the inherited property is agricultural land, additional restrictions may apply, such as agrarian reform issues, tenancy rights, landholding limits, or government approvals. The SPA alone is not enough.

XCIX. SPA and Land Under Free Patent or Homestead Restrictions

Some titles contain restrictions on transfer for a certain period or to certain persons. The SPA cannot authorize a prohibited sale. The title annotations must be checked.

C. SPA and Condominium Sale

For inherited condominium units, the SPA may authorize dealing with the condominium corporation or property manager, including:

  1. Securing certificate of management;
  2. Paying dues;
  3. Securing clearance;
  4. Turning over keys;
  5. Transferring utility accounts;
  6. Signing condominium forms.

If the buyer is a foreigner, condominium foreign ownership limits must be checked.

CI. SPA and Untitled Land

For untitled inherited property, the SPA may authorize sale of possessory rights or tax declaration rights, but such sale does not transfer Torrens title. Buyers should understand the risk.

The SPA should describe the rights being sold accurately.

CII. SPA and Tax Declaration Property

A tax declaration is not the same as title. An attorney-in-fact selling inherited property covered only by tax declaration should not represent that it is titled land.

The buyer should conduct due diligence.

CIII. SPA and Duplicate or Conflicting Titles

If there are title problems, the SPA may need authority to file petitions, secure certifications, or correct records. But complex title disputes may require court action and legal counsel.

CIV. SPA and Lost Title

If the owner’s duplicate title is lost, an SPA may authorize the attorney-in-fact to file or assist in a petition for replacement, but a court proceeding may be required. The sale usually cannot be registered until the title is replaced.

CV. SPA and Adverse Claims or Lis Pendens

If the title contains adverse claims, notices of lis pendens, levy, attachment, or other encumbrances, the SPA cannot remove them by itself. The attorney-in-fact may need authority to settle, cancel, or address them, but legal steps may be required.

CVI. SPA and Family Disputes

Inherited property often triggers family disputes. An SPA should not be signed if the heir does not understand:

  1. Property value;
  2. Share to be sold;
  3. Buyer identity;
  4. Tax consequences;
  5. Amount to be received;
  6. Whether other heirs are included;
  7. Whether the estate has debts;
  8. Whether there are pending cases.

An heir should not sign under pressure.

CVII. Fraud Risks in SPA Transactions

Common fraud risks include:

  1. Forged SPA;
  2. Fake notarization;
  3. Fake apostille;
  4. Principal did not understand document;
  5. Attorney-in-fact sells below agreed price;
  6. Attorney-in-fact keeps proceeds;
  7. Attorney-in-fact sells more than authorized;
  8. Heir’s signature obtained through deception;
  9. Buyer colludes with attorney-in-fact;
  10. Missing heirs are hidden;
  11. False claim that all heirs consented;
  12. Fake death or heirship documents.

Due diligence is essential.

CVIII. Forged SPA

A forged SPA is void as to the person whose signature was forged. A sale based on forged authority may be challenged.

Buyers should verify identity and authenticity, especially for heirs abroad.

CIX. Fake Notarization

A notarized document may still be fake if the notary did not actually notarize it, the notary commission was invalid, or the signer did not appear.

For high-value transactions, verify questionable notarizations.

CX. Fake Apostille or Consular Seal

Foreign-executed SPAs should be checked carefully. A fake apostille or fake consular seal may lead to rejection and possible criminal issues.

CXI. Attorney-in-Fact Misappropriates Proceeds

If the attorney-in-fact receives sale proceeds and fails to remit them, the principal may have civil and possibly criminal remedies depending on facts.

This is why proceeds should preferably be paid directly to principals or through traceable methods.

CXII. Attorney-in-Fact Exceeds Authority

If the attorney-in-fact acts beyond the SPA, the principal may not be bound unless the principal ratifies the act or legal rules protect an innocent third party.

Examples:

  1. Selling below authorized price;
  2. Selling property not covered by SPA;
  3. Receiving proceeds without authority;
  4. Signing waiver not authorized;
  5. Selling to himself without authority;
  6. Altering terms beyond authority.

Clear drafting prevents disputes.

CXIII. Ratification

If an attorney-in-fact acted without sufficient authority, the principal may later ratify the act. Ratification should be clear and properly documented.

Without ratification, the transaction may be challenged.

CXIV. Revoking an SPA Before Sale

If an heir changes his or her mind, revocation should be written and communicated promptly to:

  1. Attorney-in-fact;
  2. Buyer;
  3. Co-heirs;
  4. Broker;
  5. Notary;
  6. BIR or Registry, if documents were submitted;
  7. Any party relying on the SPA.

Failure to notify may create complications.

CXV. Can an SPA Be Irrevocable?

Some SPAs state they are irrevocable. Irrevocability may be recognized in certain situations where the agency is coupled with an interest or supports a bilateral contract. However, not every “irrevocable SPA” is truly irrevocable.

For ordinary inherited property sale authority, legal advice is needed before relying on irrevocability.

CXVI. SPA Coupled With Interest

An agency coupled with interest may arise where the attorney-in-fact has a present interest in the subject matter, not merely a commission. This is technical and should not be casually inserted.

CXVII. SPA Used as Security

Sometimes an SPA is used by a lender or buyer as security to sell property if the owner fails to pay. This is risky and may be challenged depending on the arrangement. A deed of mortgage, conditional sale, or other proper instrument may be more appropriate.

CXVIII. SPA and Simulated Sale

An SPA should not be used to disguise a donation, loan, mortgage, or inheritance waiver. The documents should reflect the true transaction.

CXIX. SPA and Double Sale

If an attorney-in-fact sells the property to one buyer while another heir sells to another, double sale issues may arise. Buyers should register promptly and verify authority.

CXX. SPA and Buyer’s Payment Before Estate Settlement

A buyer may pay earnest money before estate settlement is completed. This is risky if:

  1. Not all heirs agree;
  2. Estate tax is high;
  3. Title has problems;
  4. SPA is defective;
  5. There are minor heirs;
  6. There are omitted heirs;
  7. Property cannot be transferred.

A written reservation agreement or conditional sale may be needed.

CXXI. Earnest Money and Down Payment

If the attorney-in-fact may receive earnest money or down payment, the SPA should say so. The agreement should state whether payment is refundable if estate settlement fails.

CXXII. Sale Before Estate Tax Payment

A sale may be agreed upon before estate tax is paid, but registration cannot usually proceed without estate tax clearance and CAR/eCAR. The deed and payment terms should account for this.

CXXIII. Combined Estate Settlement and Sale

A common efficient structure is:

  1. Heirs execute extrajudicial settlement with sale;
  2. Heirs abroad sign through SPA;
  3. Estate tax is paid;
  4. Sale taxes are paid;
  5. BIR issues eCAR;
  6. Registry transfers title directly to buyer.

This avoids transferring title first to heirs and then separately to buyer, but it must be properly documented.

CXXIV. Step-by-Step Process for Sale Through SPA

A typical process may be:

  1. Identify all heirs and their shares.
  2. Verify title and property documents.
  3. Determine whether estate settlement is needed.
  4. Prepare SPA for heirs who cannot personally sign.
  5. Execute SPA properly in the Philippines or abroad.
  6. Prepare extrajudicial settlement with sale or deed of sale.
  7. Sign and notarize main deed.
  8. Publish extrajudicial settlement if required.
  9. File estate tax return and pay estate tax.
  10. File sale-related taxes.
  11. Secure BIR CAR/eCAR.
  12. Pay local transfer tax.
  13. Register documents with Registry of Deeds.
  14. Secure new title in buyer’s name.
  15. Transfer tax declaration.
  16. Distribute sale proceeds among heirs.
  17. Keep full accounting and copies.

CXXV. Documents Commonly Required

Common documents include:

  1. Death certificate of deceased owner;
  2. PSA marriage certificate of deceased, if applicable;
  3. Birth certificates of heirs;
  4. Marriage certificates of heirs, if relevant;
  5. Valid IDs of heirs;
  6. TINs of heirs;
  7. Original title;
  8. Owner’s duplicate title;
  9. Tax declarations;
  10. Real property tax clearance;
  11. SPA of absent heirs;
  12. Consularized or apostilled SPA, if executed abroad;
  13. Extrajudicial settlement or settlement with sale;
  14. Deed of sale;
  15. Publication affidavit;
  16. Estate tax return;
  17. Capital gains tax return;
  18. Documentary stamp tax return;
  19. BIR CAR/eCAR;
  20. Transfer tax receipt;
  21. Registry of Deeds forms;
  22. Assessor’s forms.

Requirements vary depending on facts and location.

CXXVI. Common Reasons SPAs Are Rejected

An SPA may be rejected because:

  1. It is not notarized;
  2. It is not apostilled or consularized;
  3. It lacks authority to sell;
  4. It lacks authority to sign extrajudicial settlement;
  5. It does not describe the property;
  6. The title number is wrong;
  7. The principal’s name differs from records;
  8. The attorney-in-fact’s name differs from ID;
  9. It is expired;
  10. It appears altered;
  11. It is only a photocopy;
  12. It lacks authority to receive proceeds;
  13. It lacks authority to transact with BIR;
  14. It was signed by a minor or incapacitated person;
  15. It was executed after the principal died;
  16. The notary or apostille is defective.

CXXVII. Common Mistakes by Heirs

Common mistakes include:

  1. Signing a general SPA instead of a specific SPA;
  2. Failing to include authority to sell;
  3. Failing to include authority to settle estate;
  4. Not identifying the property;
  5. Letting one heir sign for all without authority;
  6. Ignoring minor heirs;
  7. Excluding illegitimate children;
  8. Assuming payment of tax gives ownership;
  9. Trusting verbal promises on proceeds;
  10. Allowing attorney-in-fact to receive money without safeguards;
  11. Signing blank documents;
  12. Not keeping copies;
  13. Not checking tax implications;
  14. Not confirming whether title has encumbrances.

CXXVIII. Common Mistakes by Buyers

Common buyer mistakes include:

  1. Accepting a vague SPA;
  2. Paying attorney-in-fact without authority to receive money;
  3. Failing to identify all heirs;
  4. Not checking estate tax status;
  5. Not checking title annotations;
  6. Ignoring minor heirs;
  7. Paying before documents are complete;
  8. Not verifying foreign-executed SPA;
  9. Assuming eldest child owns the property;
  10. Buying only one heir’s share while expecting whole property;
  11. Not requiring owner’s duplicate title;
  12. Not using traceable payment;
  13. Failing to register promptly.

CXXIX. Common Mistakes by Attorneys-in-Fact

Common mistakes include:

  1. Acting beyond authority;
  2. Mixing personal funds with sale proceeds;
  3. Not issuing receipts;
  4. Not accounting to heirs;
  5. Signing documents not authorized;
  6. Agreeing to price changes without consent;
  7. Ignoring tax deadlines;
  8. Using unofficial fixers;
  9. Misplacing original title;
  10. Failing to keep heirs informed;
  11. Receiving cash without documentation;
  12. Not preserving official receipts.

CXXX. Accounting by Attorney-in-Fact

The attorney-in-fact should provide an accounting showing:

  1. Gross sale price;
  2. Taxes paid;
  3. Registration expenses;
  4. Publication costs;
  5. Broker’s commission;
  6. Notarial fees;
  7. Processing expenses;
  8. Net proceeds;
  9. Share of each heir;
  10. Payment method and date.

This prevents family disputes.

CXXXI. Distribution of Sale Proceeds

Sale proceeds should be distributed according to lawful shares or written agreement among heirs. The attorney-in-fact should not decide shares arbitrarily.

If heirs agreed to a different distribution, the agreement should be in writing.

CXXXII. If Heirs Disagree on Sale

If some heirs want to sell and others refuse, the selling heirs may sell only their shares, or the parties may need partition proceedings. One heir cannot force sale of the entire property through an SPA without consent or court order.

CXXXIII. Judicial Partition

If heirs cannot agree, a judicial partition case may be necessary. An SPA may authorize a representative to appear in the case, but court proceedings are separate from ordinary sale.

CXXXIV. Sale of Co-Owned Inherited Property

After succession, heirs may become co-owners. Co-owners may sell their undivided shares, but not the whole property without all co-owners’ consent.

A buyer of an undivided share enters co-ownership and may later seek partition.

CXXXV. If One Heir Is Missing

If an heir cannot be located, sale of the entire property is difficult. Legal steps may be needed, such as court proceedings, appointment of representative, or sale only of available shares.

Do not falsely state that a missing heir is dead or waived rights.

CXXXVI. If One Heir Is Abroad and Refuses to Sign

The property cannot be sold entirely without that heir’s participation if the heir owns a share. The other heirs may sell their shares, but the buyer will not acquire the refusing heir’s share.

CXXXVII. If One Heir Already Sold His Share

An heir may have sold hereditary rights or share earlier. The buyer of that share may need to participate in settlement or sale. Review prior documents.

CXXXVIII. If Property Was Already Sold by Parent Before Death

If the deceased allegedly sold the property before death but title was not transferred, the heirs must review the prior sale documents. The heirs may not be free to sell again if a valid prior sale exists.

CXXXIX. If There Are Estate Debts

If the estate has debts, creditors may have claims. Extrajudicial settlement assumes no outstanding debts or that debts are addressed. Selling inherited property without addressing creditors may create liability.

CXL. If There Are Tax Debts

Unpaid estate tax, real property tax, or other tax issues can block transfer. The SPA should authorize settlement of taxes, but the heirs must plan how taxes will be paid.

CXLI. If Property Value Is High

For high-value property, the parties should use stronger safeguards:

  1. Legal review of SPA;
  2. Verification of heirs;
  3. Escrow;
  4. Direct payment to heirs;
  5. Certified true copy of title;
  6. Tax computation before sale;
  7. Written agreement on expenses;
  8. Broker licensing verification;
  9. Bank checks;
  10. Independent counsel for heirs abroad.

CXLII. If Property Is Low-Value

Even for low-value property, a proper SPA is still necessary. Government agencies will not waive authority requirements merely because the property value is low.

CXLIII. If Property Is in the Province

Heirs in Metro Manila or abroad often appoint a relative in the province to process the sale. The SPA should specifically identify the local offices and authorize travel, filing, payment, and document receipt.

CXLIV. If There Are Several Properties

An SPA may cover several inherited properties, but each should be clearly described. If future sales are uncertain, the principal may prefer separate SPAs per property.

A broad SPA covering “all inherited properties” may be risky.

CXLV. If the SPA Is for Processing Only

Sometimes the principal wants to sign the deed personally but appoints someone only to process taxes and registration. The SPA should say it is for processing only and does not authorize sale, price negotiation, or receipt of proceeds.

CXLVI. If the SPA Is for Sale Only to a Specific Buyer

The SPA may limit sale to a named buyer. This protects the principal from sale to others.

Example: “to sell the property only to Maria Reyes for not less than ₱_____.”

CXLVII. If the SPA Is for Sale at Public Bidding or Government Acquisition

If the inherited property is subject to government acquisition, right-of-way, expropriation settlement, or public bidding, the SPA should authorize the attorney-in-fact to negotiate, sign settlement documents, receive compensation, and represent before the relevant agency.

CXLVIII. If the SPA Is Required by a Developer

For inherited property sold to a developer, the developer may require specific authority to sign contracts to sell, deeds, tax forms, subdivision documents, permits, and undertakings. Heirs should review developer-prepared SPAs carefully.

CXLIX. If the SPA Is Required by a Bank Financing Buyer

If the buyer is using bank financing, the bank may require the attorney-in-fact to sign documents, accept loan proceeds, or deliver title. The SPA should match bank requirements.

CL. If the Principal Wants to Cancel the Sale

If the attorney-in-fact has not yet signed a binding deed, the principal may revoke authority. If a deed has been signed under valid authority, cancellation may require agreement, legal basis, or court action.

CLI. If Buyer Wants Assurance From Heirs Abroad

The buyer may request video confirmation, notarized affidavits, or direct communication with heirs abroad. This is prudent for large transactions, especially where the SPA is old or unusual.

CLII. If the SPA Was Signed Before Death of Registered Owner

A person cannot authorize sale of inherited property before becoming an heir, unless the authority concerns existing rights. If the registered owner was still alive when the SPA was signed by future heirs, the future heirs had no inherited rights yet.

An SPA should be executed by the actual owner during life, or by heirs after death, depending on the transaction.

CLIII. SPA From Deceased Owner Before Death

If the registered owner executed an SPA while alive authorizing sale, but died before the sale was completed, the authority generally ended upon death. The heirs must then act, unless legal exceptions apply.

A deed signed after the principal’s death under an old SPA may be invalid.

CLIV. If the Attorney-in-Fact Signed After Principal’s Death

If the attorney-in-fact signed after the principal died, the transaction may be challenged because agency generally ends upon death. Buyers should verify that the principal was alive at the time of signing.

CLV. If Principal Is Abroad and Cannot Visit Consulate

If the principal cannot access a Philippine consulate, the principal may execute before a foreign notary and obtain apostille if applicable. If apostille is not available, other authentication may be required.

The principal should confirm acceptance with the Philippine receiving agencies before sending documents.

CLVI. Translation of SPA

If the SPA is in a foreign language, a certified translation may be required. For Philippine property transactions, using English is usually more practical.

CLVII. IDs and Name Matching

The principal’s name in the SPA should match:

  1. Passport;
  2. Philippine birth certificate;
  3. Marriage certificate;
  4. Prior title or estate documents;
  5. Heirship documents;
  6. Tax records.

If not, prepare an affidavit of one and the same person or supporting documents.

CLVIII. TIN Issues

Heirs often need Taxpayer Identification Numbers for BIR processing. The SPA may authorize the attorney-in-fact to apply for or verify TIN, but tax authorities may have specific requirements.

CLIX. SPA and Privacy

The SPA contains personal information. It should be shared only with parties who need it, such as buyer, notary, BIR, Registry, banks, and counsel.

CLX. Digital Copies

Digital copies are useful for review but original or properly certified/authenticated copies are usually required for registration and government processing.

Do not rely solely on scanned SPAs for land sale registration.

CLXI. Electronic Signatures

For real property sale and registration, electronic signatures alone are generally not the ordinary accepted practice. Physical signatures, notarization, consular acknowledgment, or apostille are usually required.

CLXII. Remote Notarization

If remote notarization is proposed, verify whether it is legally accepted for the particular document and receiving agency. For land transactions, conservative practice is to use traditional notarization, consular acknowledgment, or apostille.

CLXIII. Number of Original Copies

Prepare enough originals for:

  1. Attorney-in-fact;
  2. BIR;
  3. Registry of Deeds;
  4. Buyer;
  5. Principal;
  6. Bank, if needed;
  7. Local government, if required.

Foreign-executed originals can be difficult to replace.

CLXIV. Keeping Copies

Each principal should keep:

  1. Signed SPA copy;
  2. ID copy attached;
  3. Apostille or consular page;
  4. Deed signed by attorney-in-fact;
  5. Tax receipts;
  6. CAR/eCAR;
  7. Registered deed;
  8. Proof of payment of proceeds;
  9. Accounting.

CLXV. When to Consult a Lawyer

Legal advice is strongly recommended when:

  1. Property value is high;
  2. Some heirs are abroad;
  3. Some heirs are minors;
  4. Some heirs are missing;
  5. There are illegitimate children;
  6. There is a surviving spouse;
  7. There is a will;
  8. Estate tax is unpaid for many years;
  9. Title is lost;
  10. Property is mortgaged;
  11. There are tenants or occupants;
  12. Heirs disagree;
  13. Buyer wants immediate payment before settlement;
  14. SPA is to be executed abroad;
  15. Attorney-in-fact will receive proceeds;
  16. There is risk of fraud.

CLXVI. Practical Checklist Before Signing an SPA

Before signing, the principal should ask:

  1. What property is being sold?
  2. What is my legal share?
  3. Who are all the heirs?
  4. What is the selling price?
  5. Who is the buyer?
  6. Who will receive the money?
  7. What taxes and expenses will be deducted?
  8. Is the title clean?
  9. Is estate tax paid?
  10. Is the SPA limited or broad?
  11. Can the attorney-in-fact sell to himself?
  12. Can the attorney-in-fact delegate?
  13. When does the SPA expire?
  14. Will I receive copies of all documents?
  15. How will my proceeds be sent?

Do not sign if these are unclear.

CLXVII. Practical Checklist for Drafting the SPA

The SPA should specify:

  1. Principal’s complete identity;
  2. Attorney-in-fact’s complete identity;
  3. Property description;
  4. Title or tax declaration number;
  5. Deceased owner and estate context;
  6. Authority to settle estate;
  7. Authority to sell;
  8. Authority to sign deed;
  9. Authority to receive or not receive proceeds;
  10. Authority to pay taxes;
  11. Authority to transact with BIR;
  12. Authority to transact with Registry of Deeds;
  13. Authority to transfer tax declaration;
  14. Authority to sign affidavits and forms;
  15. Limitations and expiration;
  16. Governing Philippine use;
  17. Proper acknowledgment.

CLXVIII. Practical Checklist for Buyers Reviewing SPA

The buyer should check:

  1. Is the SPA original?
  2. Is it notarized, apostilled, or consularized?
  3. Is the principal alive?
  4. Is the principal really an heir?
  5. Does the SPA identify the property?
  6. Does it authorize sale?
  7. Does it authorize signing of settlement with sale?
  8. Does it authorize receipt of payment?
  9. Does it cover the whole property or only a share?
  10. Are all heirs represented?
  11. Are there minors?
  12. Are IDs attached?
  13. Is the SPA recent?
  14. Are there signs of alteration?
  15. Has the principal confirmed authority?

CLXIX. Practical Checklist for Attorney-in-Fact

The attorney-in-fact should:

  1. Read the SPA carefully;
  2. Act only within authority;
  3. Keep principals informed;
  4. Avoid conflicts of interest;
  5. Use official receipts;
  6. Keep copies of filings;
  7. Avoid cash if possible;
  8. Account for proceeds;
  9. Do not sign unauthorized waivers;
  10. Do not use fixers;
  11. Follow tax deadlines;
  12. Return documents after completion.

CLXX. Frequently Asked Questions

1. Can an heir abroad authorize someone in the Philippines to sell inherited property?

Yes. The heir may execute an SPA abroad, properly acknowledged and authenticated or apostilled for use in the Philippines.

2. Is a general SPA enough to sell inherited land?

Usually, no. The SPA should specifically authorize sale of the identified property and signing of the necessary deeds.

3. Can one heir sell the entire inherited property?

Only if all heirs and co-owners participate or authorize the sale. One heir alone can generally sell only his or her share.

4. Can an SPA settle the estate?

No. The SPA authorizes someone to sign the settlement documents. The actual settlement must be made through a proper deed or court process.

5. Can the attorney-in-fact receive the sale proceeds?

Only if the SPA clearly authorizes receipt of proceeds. Otherwise, payment should be made directly to the principal or lawful seller.

6. Does an SPA need to be notarized?

Yes, for practical and legal use in real property transactions, it should be notarized or properly acknowledged.

7. Does an SPA signed abroad need apostille or consularization?

Generally, yes. The document must be authenticated in a manner acceptable for use in the Philippines.

8. Can an SPA be used after the principal dies?

Generally, agency ends upon death of the principal. A sale signed after the principal’s death under that SPA may be invalid.

9. Can a parent sign an SPA for a minor heir?

A parent may represent a minor in some matters, but sale of a minor’s inherited property may require court approval or guardianship authority. Legal advice is needed.

10. Can the attorney-in-fact sell the property to himself?

Only if clearly authorized and legally proper. This is a conflict-of-interest situation and may be scrutinized.

CLXXI. Legal Remedies if SPA Is Misused

If an SPA is misused, possible remedies include:

  1. Revocation of SPA;
  2. Demand for accounting;
  3. Civil action for recovery of proceeds;
  4. Action to annul sale;
  5. Action for damages;
  6. Criminal complaint for estafa or falsification, depending on facts;
  7. Complaint against notary, if notarization was improper;
  8. Notice to buyer and Registry of Deeds;
  9. Adverse claim or lis pendens, if legally proper;
  10. Settlement among heirs.

The proper remedy depends on whether the sale was completed, registered, and relied upon by third parties.

CLXXII. Conclusion

A Special Power of Attorney for the sale of inherited property in the Philippines is a powerful document. It allows an heir, surviving spouse, or other interested person to authorize a trusted representative to sign, sell, process, pay taxes, register documents, and complete a transaction involving inherited property. It is especially useful when heirs are abroad, unavailable, or unable to personally attend to the sale.

However, an SPA is only an authority document. It does not by itself settle the estate, pay taxes, transfer title, cure missing heirs, replace court approval for minors, or validate a defective sale. The inherited property must still be properly settled, taxed, sold, and registered according to Philippine law.

For the SPA to be effective, it must be specific. It should identify the property, name the attorney-in-fact, authorize sale, authorize signing of extrajudicial settlement or deed of sale, authorize tax and registration processing, and clearly state whether the attorney-in-fact may receive the sale proceeds. If executed abroad, it must be consularized or apostilled as required.

The greatest risks are vague authority, missing heirs, unpaid estate taxes, forged or defective SPAs, unauthorized receipt of proceeds, minors’ shares, surviving spouse rights, and title problems. Heirs should never sign blank or overly broad documents without understanding the sale. Buyers should verify the SPA and heirship carefully before paying. Attorneys-in-fact should act strictly within authority and account for all proceeds.

A properly drafted and properly authenticated SPA can make the sale of inherited property efficient and legally secure. A vague or misused SPA can create family conflict, tax problems, registry rejection, litigation, and possible criminal liability.

Disclaimer: This content is not legal advice and may involve AI assistance. Information may be inaccurate.

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