GR 33796; (February, 1931) (Digest)
G.R. No. 33796 ; February 17, 1931
PHILIPPINE NATIONAL BANK, plaintiff-appellee, vs. ESTANISLAO PALMA GIL, ET AL., defendants-appellants.
FACTS
Estanislao Palma Gil executed a general power of attorney in favor of his son-in-law, Alejandro Iñigo, authorizing him to obtain loans secured by property. Using this authority, Iñigo executed two mortgages dated February 11, 1919, over Estanislao’s properties, signing as his attorney-in-fact and also as the husband of Estanislao’s daughter, Leonila Palma Gil. A third mortgage dated April 22, 1921, was executed by Iñigo over Estanislao’s property, but this mortgage was signed only in Iñigo’s personal name and contained no recital that he was acting as an agent. Later, a renewal promissory note dated January 7, 1926, was signed “Estanislao Palma Gil, By: A. Iñigo.” The Philippine National Bank sued to recover the debt and foreclose the mortgages.
ISSUE
1. Whether Estanislao Palma Gil is liable on the promissory note and the two 1919 mortgages executed by his agent, Iñigo.
2. Whether the 1921 mortgage executed by Iñigo in his own name is valid and binding on Estanislao.
3. Whether Leonila Palma Gil is jointly and severally liable with her father.
RULING
1. Yes, Estanislao is liable on the promissory note and the two 1919 mortgages. Under Article 1727 of the Civil Code, the principal must fulfill the obligations contracted by the agent within the scope of his authority. Iñigo acted within the powers granted by the general power of attorney in executing these instruments.
2. No, the 1921 mortgage is void as to Estanislao. The mortgage was executed by Iñigo in his personal name without any indication he was acting as an agent for Estanislao. Since Iñigo had no title to the property, the mortgage is void.
3. No, Leonila is not liable. She did not sign the promissory note. While she signed the 1919 mortgages, this was merely precautionary as the mortgaged properties were registered solely in her father’s name.
The appealed judgment was modified accordingly, holding only Estanislao Palma Gil liable for the debt and ordering the foreclosure only of the properties under the two valid 1919 mortgages.
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