791 SCRA 581 / G.R. No. 182537. June 1, 2016.

MACTAN-CEBU INTERNATIONAL AIRPORT

AUTHORITY, petitioner, vs. RICHARD E. UNCHUAN,
respondent.
Civil Law; Sale of Real Property by Agent; Agency;
When the sale of a piece of land or any interest thereon is
through an agent, the authority of the latter shall be in
writing; otherwise, the sale shall be void. —The
significance of requiring the authority of an agent to be
put into writing was amplified in Dizon v. Court of Appeals,
396 SCRA 151 (2003): When the sale of a piece of land or
any interest thereon is through an agent, the authority of
the latter shall be in writing; otherwise, the sale shall be
void. Thus the authority of an agent to execute a contract
for the sale of real estate must be conferred in writing and
must give him specific authority, either to conduct the
general business of the principal or to execute a binding
contract containing terms and conditions which are in the
contract he did execute. A special power of attorney is
necessary to enter into any contract by which the
ownership of an immovable is transmitted or acquired
either gratuitously or for a valuable consideration. The
express mandate required by law to enable an appointee
of an agency (couched) in general terms to sell must be
one that expressly mentions a sale or that includes a sale
as a necessary ingredient of the act mentioned. For the
principal to confer the right upon an agent to sell real
estate, a power of attorney must so express the powers of
the agent in clear and unmistakable language. When there
is any reasonable doubt that the language so used
conveys such power, no such construction shall be given
the document.
 Same; Same; Laches; Laches will not set in against a
void transaction where the agent did not have a special
power of attorney (SPA) to dispose of the lots co-owned by
the other registered owners.—The rule is that a void
contract produces no effect either against or in favor of
anyone and cannot be ratified. Similarly, laches will not
set in against a void transaction, as in this case, where
the agent did not have a special power of attorney to
dispose of the lots co-owned by the other registered
owners. In fact, Article 1410 of the Civil Code
_______________
* SECOND DIVISION.

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Unchuan

specifically provides that an action to declare the

inexistence of a void contract does not prescribe. The
transaction entered into by Atanacio and CAA, however,
was not entirely void because the lack of consent by the
other co-owners in the sale was with respect to their
shares only. Article 493 of the New Civil Code expressly
provides: Art. 493. Each co-owner shall have the full
ownership of his part and the fruits and benefits pertaining
thereto, and he may therefore alienate, assign or mortgage
it, and even substitute another person in its enjoyment,
except when personal rights are involved. But the effect of
the alienation or the mortgage, with respect to the co-
owners, shall be limited to the portion which may be
allotted to him in the division upon the termination of the
co-ownership.
Same; Co-ownership; Since a co-owner is entitled to
sell his undivided share, a sale of the entire property by
one (1) co-owner without the consent of the other co-
owners is not null and void; only the rights of the co-
owner/seller are transferred, thereby making the buyer a
co-owner of the property.—The quoted provision
recognizes the absolute right of a co-owner to freely
dispose of his pro indiviso share as well as the fruits and
other benefits arising from that share, independently of
the other co-owners. The sale of the subject lots affects
only the seller’s share pro indiviso, and the transferee gets
only what corresponds to his grantor’s share in the
partition of the property owned in common. Since a co-
owner is entitled to sell his undivided share, a sale of the
entire property by one co-owner without the consent of
the other co-owners is not null and void; only the rights of
the co-owner/seller are transferred, thereby making the
buyer a co-owner of the property.
Remedial Law; Evidence; Disputable Presumptions;
Section 3, Rule 131 of the Rules of Court identifies the
following as disputable presumptions: (1) private
transactions have been fair and regular; (2) the ordinary
course of business has been followed; and (3) there was
sufficient consideration for a contract. —Section 3, Rule
131 of the Rules of Court identifies the following as
disputable presumptions: (1) private transactions have
been fair and regular; (2) the ordinary course of business
has been followed; and (3) there was sufficient
consideration for a contract. A presumption may operate
against a challenger who has not presented any proof to
rebut it. “The effect of a legal presumption upon a burden
of proof is to create the necessity of presenting evidence
to meet the legal presumption or the prima

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facie case created thereby, and which, if no proof to

the contrary is presented and offered, will prevail. The
burden of proof remains where it is, but by the
presumption, the one who has that burden is relieved for
the time being from introducing evidence in support of the
averment, because the presumption stands in the place of
evidence unless rebutted.” Atanacio, by affixing his
signature on the deed of absolute sale, a disputable
presumption arose that consideration was paid. A mere
allegation that no payment was received is not sufficient
to dispel such legal presumption. Furthermore, the record
shows an official communication, dated October 8, 1958,
from the District Land Office of Cebu to the Provincial
Treasurer of Cebu stating that Provincial Voucher No.
05358 was disbursed in favor of Atanacio.
PETITION for review on certiorari of the decision and
resolution of the Court of Appeals.
The facts are stated in the opinion of the Court.
Gica, Del Socorro, Espinoza, Villarmia, Tan and
Fernandez for respondent.
MENDOZA, J.:
 This petition for review on certiorari under Rule
1

45 of the 1997 Rules of Civil Procedure filed by

petitioner Mactan-Cebu International Airport
Authority (MCIAA), represented by the Office of the
Solicitor General (OSG), assails the November 29,
2007 Decision and the March 25, 2008 Resolution of
2 3

the Court of Appeals (CA), in C.A.-G.R. CV No. 01306,

which affirmed the March 3, 2006 Decision of the 4

Regional Trial Court, Lapu-Lapu City, Branch 27

(RTC), in Civil Case No.
_______________
1 Rollo, pp. 114-186.
2 Id., at pp. 194-215. Penned by Associate Justice Francisco P.
Acosta, with Associate Justices Pampio A. Abarintos and
Priscilla J. Baltazar-Padilla, concurring.
3 Id., at pp. 217-221.
4 Id., at pp. 290-317. Penned by Acting Presiding Judge
Geraldine Faith A. Econg.

584
584 SUPREME COURT REPORTS ANNOTATED
Mactan-Cebu International Airport Authority vs.
Unchuan

6120-L, an action for declaration of nullity of deed of

absolute sale, quieting of title and/or payment of just
compensation, rental, damages, and attorney’s fees.

The Antecedents
On March 5, 2004, respondent Richard Unchuan
(Unchuan) filed a complaint for Partial Declaration of
Nullity of the Deed of Absolute Sale with Plea for
Partition, Damages and Attorney’s Fees before the
RTC against MCIAA. Unchuan later filed an Amended
5

Complaint for Declaration of Nullity of Deed of

Absolute Sale, Quieting of Title and/or Payment of
Just Compensation, Rental and Damages and
Attorney’s Fees. 6

In his complaint, Unchuan alleged, among others,

that he was the legal and rightful owner of Lot No.
4810-A, with an area of 177,176 square meters,
and Lot No. 4810-B, with an area of 2,740 square
meters, both located in Barrio Buaya, Lapu-Lapu City,
and covered by Original Certificate of Title (OCT) No.
RO-1173; that the title was registered under the
7

names of the heirs of Eugenio Godinez, specifically,

Teodora Tampus, Fernanda Godinez (the wife of
Iscolastico Epe), Tomasa Godinez (the wife of Mateo
Ibañez), Sotera Godinez (the wife of Guillermo Pino),
Atanasio Godinez (married to Florencia Pino), Juana
8

Godinez (the wife of Catalino Cuison), and Ambrosio

Godinez (married to Mamerta Inot); and that he
bought the two lots from the surviving heirs of the
registered owners through several deeds of absolute
sale, all dated December 7, 1998. 9

_______________
5 Records (Vol. I), pp. 1-9.
6 Id., at pp. 103-112.
7 CA Rollo, pp. 114-115.
8 Also referred to as Atanacio Godinez.
 9 Records (Vol. I), pp. 12-56.

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For reference, the table below summarizes the sale

transactions between Unchuan and the aforesaid
surviving heirs of the original registered owners:

Unchuan further alleged that he came to know that

Atanacio Godinez (Atanacio), the supposed attorney-
in-fact of all the registered owners and their heirs,
already sold both lots to Civil Aeronautics
Administration (CAA), the predecessor of MCIAA;
19

that the sale covered by the Deed of Absolute Sale, 20

dated April 3, 1958, was null and void because the

registered
_______________
10 Id., Annex “B,” pp. 115-121.
11 Id., Annex “B-1,” pp. 122-123.
12 Id., Annex “B-2,” pp. 124-129.
13 Id., Annex “B-3,” pp. 130-132.
14 Id., Annex “B-4” and Annex “B-5,” pp. 133-138.
15 Id., Annex “B-6,” Annex “B-7,” Annex “B-8” and Annex “B-10,”
pp. 139-144; 152-154.
16 Id., Annex “B-9,” pp. 145-150.
17 Id., Annex “B-11,” pp. 155-157.
18 Id., Annex “B-12,” pp. 158-159.
 19 The CAA became Bureau of Air Transportation, which later
renamed Air Transportation Office.
20 Rollo, pp. 501-504.

586
586 SUPREME COURT REPORTS ANNOTATED
Mactan-Cebu International Airport Authority vs.
Unchuan

owners and their heirs did not authorize Atanacio to

sell their undivided shares in the subject lots in favor
of CAA; that no actual consideration was paid to the
said registered owners or their heirs, despite
promises that they would be paid; that the deed of
absolute sale did not bear the signature of the CAA
representative; that there was no proof that the
Secretary of the Department of Public Works and
Highways approved the sale; and that his
predecessors-in-interest merely tolerated the
possession by CAA and, later, by MCIAA. 21

In its Motion to Dismiss, dated April 27, 2004, MCIAA

22

moved for the dismissal of the said complaint citing

prescription, laches and estoppel as its grounds. The
RTC, however, denied the motion. MCIAA later filed
23

its Very Urgent Motion for Compulsory Joinder of

Indispensable Parties, but the RTC issued a denial
24

in the Order, dated November 5, 2004, and required

25

MCIAA to file an Answer. Again, MCIAA moved for

reconsideration, but the RTC still denied it in the
26

Order, dated January 5, 2005.

27

In its Answer, MCIAA averred that on April 3, 1958,

28

Atanacio, acting as the representative of the heirs of

Eugenio Godinez, who were the registered owners,
sold Lot No. 4810-A and Lot No. 4810-B to the
Republic of the Philippines, represented by CAA.
Thereafter, CAA took possession of the said property
upon payment of the purchase price. To corroborate
the said transaction, on September 17, 1969,
Atanacio, along with other former registered co-
owners, signed a deed of partition attesting to the
fact of sale of the two lots in favor of the government
and admitted its absolute right over the same.
_______________
21 Id., at p. 754.
22 Id., at pp. 241-250.
23 Id., at p. 251.
24 Id., at pp. 252-255.
25 Id., at pp. 256-257.
26 Id., at pp. 258-275.
27 Id., at p. 276.
28 Id., at pp. 277-288.

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Since then, the said lots had been in the possession
of the Republic in the concept of an owner. The said
real properties were declared by the Republic for
taxation purposes under Tax Declaration No. 00078
and Tax Declaration No. 00092. In fact, by virtue of
Republic Act (R.A.) No. 6958, otherwise known as
“The Charter of Mactan-Cebu International Airport
Authority,” the Republic officially turned over the
management of the said lots to MCIAA.
On March 3, 2006, the RTC rendered judgment in
favor of Unchuan. The decretal portion of the
decision reads:

WHEREFORE, the above as premises, this

court hereby renders judgment in favor of
Plaintiff Unchuan and against Defendant MCIAA
and declares:
a. The Deed of Sale signed by Atanacio
Godinez alienating the lands denominated as Lot
Nos. 4810-A and 4810-B in favor of Defendant’s
predecessor-in-interest as VOID;
b. Plaintiff as the true and legal owner of Lot
Nos. 4810-A and 4810-B consisting of ONE
HUNDRED SEVENTY-NINE THOUSAND NINE
HUNDRED SIXTEEN (179,916) SQUARE METERS
because the Deed of Sale between Plaintiffs
predecessor-in-interest is void;
c. The Register of Deeds of Lapu-Lapu City to
annotate in OCT No. RO-1173 up to the extent of
the right of Plaintiff in the said land and to
 subsequently issue a title in his name up to such
extent;
d. Defendant is directed to vacate from Lot
Nos. 4810-A and 4810-B;
e. Defendant to pay the sum of TWENTY
PESOS (Php20.00) per square meter per month
as rental reckoned from the time of the filing of
the complaint until Defendant shall vacate the
same.
No pronouncement as to the cost of this suit.

588
588 SUPREME COURT REPORTS ANNOTATED
Mactan-Cebu International Airport Authority vs.
Unchuan

SO ORDERED. 29

The RTC held that Atanacio was not legally

authorized to act as the attorney-in-fact of his
brothers and sisters and to transact on their behalf
because he was not clothed with a special power of
attorney granting him authority to sell the disputed
lots. “This lack of authority of Atanacio Godinez,
therefore, has an effect of making the contract of
sale between the parties’ predecessors-in-interest as
void except perhaps for the share of Atanacio
Godinez which he could very well alienate.”
Moreover, the documentation of the sale was never
transmitted to CAA’s Manila Office; hence, the heirs
did not receive any payment for the sale
transaction.
30

The RTC also noted that the deed of absolute sale

presented to the trial court did not bear the
signature of the then CAA Administrator which would
have shown that the vendee consented to the sale.
Thus, the RTC concluded that (1) there was no valid
consideration for the alleged conveyance; (2) Ata-
nacio lacked the authority to alienate the undivided
shares of his coheirs to CAA, MCIAA’s predecessor-
in-interest; and (3) the lack of signature of the CAA
Administrator was indicative of the lack of consent
from him to purchase the lots.
31

Aggrieved, MCIAA appealed the said decision to the

CA.
On November 29, 2007, the CA affirmed the RTC
decision. The CA explained that Atanacio had no
authority to act as an agent for the other registered
owners and their heirs absent the special power of
attorney specifically executed for such purpose as
required in Article 1874 of the New Civil Code. Also,
no evidence was adduced to show that the purchase
price for the said lots was paid. For being a void
contract, the heirs’ deed of partition acknowledging
the purported sale in favor of CAA was found by the
CA to have produced no legal
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effects and not susceptible of ratification. It was of

the view that prescription, estoppel or laches did not
set in because a void contract could be questioned
anytime and an action or defense for the declaration
of its inexistence or absolute nullity was
imprescriptible. It also noted that the deed of
absolute sale was not signed by the then CAA
authorized representative.32

MCIAA filed its Motion for Reconsideration, dated

33

December 18, 2007, and subsequently, its

Supplemental Motion for Reconsideration, dated34

January 30, 2008. Later, MCIAA filed its Motion for

New Trial, dated March 6, 2008, in which it
35

incorporated three newly discovered evidence: a)

certified true copy of the Deed of Absolute Sale
executed between Atanacio Godinez and the
Republic, represented by CAA, with the signature of
then Administrator Urbano B. Caldoza (Caldoza)
showing that the vendee consented to the sale; b) 36

certified true copy of the Joint Affidavit of

Confirmation of Sale of Alloted Shares Already
Adjudicated and Quitclaim of a Portion of Lot No.
4810, dated July 21, 1969, executed by the other
heirs who did not sign the Deed of Partition
acknowledging the sale; and c) certified true copy of
the Provincial Voucher with attachments showing
that there was payment of the purchase price.
MCIAA claimed that the said documents would prove
that there was consent between the contracting
parties and that the consideration was paid.
In its March 25, 2008 Resolution, the CA denied
37

MCIAA’s Motion for Reconsideration. Before MCIAA

received its copy of the March 25, 2008 CA
Resolution, it filed a Supplemental Motion for
Reconsideration adopting the said newly discovered
evidence. The CA Resolution partly reads:
_______________
32 Id., at pp. 201-212.
33 Id., at pp. 399-426.
34 Id., at pp. 427-448.
35 Id., at pp. 450-464.
36 Id., at pp. 470-473.
37 Id., at pp. 217-221.

590
590 SUPREME COURT REPORTS ANNOTATED
Mactan-Cebu International Airport Authority vs.
Unchuan

After a very careful read-through of the motion for

reconsideration, we find no new or substantial
arguments which have not been presented in
defendant-appellant’s prior pleadings and which have
not been taken up or considered in our Decision,
save for the allegation that the proper remedy should
have been a petition for just compensation.
Otherwise, no further ratiocination is needed to
show there was a valid sale between the registered
owners of the subject lots and the Civil Aeronautics
Administration (CAA), the predecessor-in-interest of
defendant-appellant MCIAA. There was absolutely no
competent evidence to prove that all of the
registered owners of the subject properties gave
their consent to the sale through their attorney-in-
fact or that the CAA through its authorized
representative gave his approval to the sale or that
there was consideration. In addition, we see no
reason to discuss again our finding that
prescription, laches, or estoppel is unavailing against
the registered owners and equally unavailing against
the latter’s successor’s, including herein plaintiff-
appellee, they having stepped into the shoes of the
decedents-registered owners by operation of law.
Allow us, however, to revisit the defendant-
appellant’s claim that extrinsic fraud prevented it
from having a fair trial and completely presenting its
case before the trial court, clearly adverting to the
omission of Atty. Sigfredo V. Dublin to timely apprise
the OSG of the adverse claim (in favor of defendant-
appellant) that was annotated in the Original
Certificate of Title No. RO-1173 on October 9, 1998.
In our decision, we stressed that even if there was a
belated annotation of the adverse claim in OCT No.
RO-1173, said annotation is of no force and effect
since the same was predicated on a void and
inexistent contract. For like “the spring that cannot
rise above its source,” a void contract cannot create
a valid and legally enforceable right.
Anent the allegation of extrinsic fraud, we are not at
all persuaded there was one. “Extrinsic or collateral

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fraud, as distinguished from intrinsic fraud, connotes

any fraudulent scheme executed by a prevailing
litigant outside the trial of a case against the
defeated party, or his agent, attorneys or witnesses,
whereby said defeated party, is prevented from
presenting fully and fairly his side of the case.” . . . In
other words, extrinsic fraud is one that affects and
goes into the jurisdiction of the Court or that the
defendant-appellant was deprived of due process of
law owing to the gross negligence of its counsel.
Both do not, however, obtain under the
circumstances prevailing in the instant case.
Firstly, defendant-appellant has not shown
any clear and convincing evidence that the
plaintiff-appellee employed actual and extrinsic
fraud in procuring a favorable decision from the
trial court. Sadly, it failed to show that it was
prevented by the plaintiff-appellee from
asserting its right over the subject properties
and properly presenting its case by reason of
such alleged fraud; neither was any evidence
proffered to substantiate such allegation.
And secondly, it bears to stress that the
failure of Arty. Sigfredo V. Dublin to fully apprise
the OSG of the annotation of the defendant-
appellant’s adverse claim is not tantamount to
gross negligence of counsel. With due and
reasonable diligence, the said annotation could
have been timely presented by the OSG during
the presentation of evidence. It bears to stress
that the office which has custody of OCT No.
RO-1173 (where the adverse claim is annotated)
is another government agency, The Registry of
Deeds, which the OSG can easily have access
to.
As we have held in our decision, the
defendant-appellant’s heavy reliance on the
Deed of Partition which contained the phrase:
Lot No. 4810-A, with an area of ONE HUNDRED
SEVENTY-SEVEN THOUSAND ONE HUNDRED
SEVENTY-SIX (177,176) square meters and Lot
4810-B,with [an] area of TWO THOUSAND SEVEN
HUNDRED FORTY (2,740) square meters, ARE
OWNED by the Civil Aeronautics Administration
 having bought the same from the original
owners; (Emphasis supplied)

592
592 SUPREME COURT REPORTS ANNOTATED
Mactan-Cebu International Airport Authority vs.
Unchuan

to support its assertion that the Civil Aeronautics

Administration (predecessor-in-interest of MCIAA)
had indeed validly purchased the lots from the
registered owners through their purported attorney-
in-fact, Atanacio Godinez, is misplaced. This Court
had already found and ruled that:
“... At most, the above quoted statement is a
mistaken conclusion that the CAA validly purchased
the subject lots. The above quoted statement does
not change the fact that the Deed of Sale in favor of
CAA was void and inexistent. Neither can the same
be considered as a cure for the defect of lack of
consent or authority.”
“Lack of consent and consideration made the deeds
of sale void altogether and rendered them subject to
attack at any time, conformably to the rule in Article
1410 that an action to declare the existence of void
contracts does not prescribe.” We would like to add
that there is even “no need of an action to set aside
a void and inexistent contract; in fact, such action
cannot logically exist. However, an action to declare
the nonexistence of the contract can be maintained;
and in the same action, the plaintiff may recover
what he has given by virtue of the contract.” 38

Undaunted, MCIAA filed this present action, praying

for the reversal of the assailed CA ruling and for a
new judgment dismissing the complaint against
MCIAA or, in the alternative, to remand the case to
the CA to thresh out all unresolved factual issues
concerning the case. To bolster the reliefs prayed for,
MCIAA offers the following:
_______________
38 Id., at pp. 217-220.

592
592 SUPREME COURT REPORTS ANNOTATED
Mactan-Cebu International Airport Authority vs.
Unchuan

Grounds Relied Upon

in Support of the Petition

I
THE COURT OF APPEALS COMMITTED A
SERIOUS ERROR IN LAW WHEN IT AFFIRMED
THE MARCH 3, 2006 DECISION OF THE TRIAL
COURT DESPITE THE FACT THAT:
 A
THE TRIAL COURT GRAVELY ERRED IN
DECLARING THAT ATANACIO GODINEZ WAS NOT
AUTHORIZED TO CONVEY LOT NOS. 4810-A AND
4810-B TO CAA.

B
THE TRIAL COURT GRAVELY ERRED IN
FINDING THAT RESPONDENTS’ PREDECESSORS-
IN-INTEREST WERE NOT PAID THE
CONSIDERATION FOR THE SALE OF THE
SUBJECT LOTS.

C
THE TRIAL COURT GRAVELY ERRED IN
DECLARING AS VOID AND INVALID THE DEED OF
ABSOLUTE SALE EXECUTED BY ATANACIO
GODINEZ IN FAVOR OF THE CAA.

D
THE TRIAL COURT GRAVELY ERRED IN
HOLDING THAT RESPONDENT’S
PREDECESSORS-IN-INTEREST ARE NOT
INDISPENSABLE PARTIES TO THE INSTANT
CASE.

E
THE TRIAL COURT GRAVELY ERRED IN
DECLARING THAT RESPONDENT’S CAUSE OF
 ACTION IS NOT BARRED BY PRESCRIPTION,
LACHES AND ESTOPPEL.

594
594 SUPREME COURT REPORTS ANNOTATED
Mactan-Cebu International Airport Authority vs.
Unchuan

II

THE COURT OF APPEALS COMMITTED A

SERIOUS ERROR IN LAW BY NOT ADMITTING
THE ADDITIONAL EVIDENCE SOUGHT TO BE
INTRODUCED BY PETITIONER. 39

The OSG argues that “the mere absence of a

special power of attorney in favor of Atanacio
Godinez does not necessarily mean that he was
not authorized by his co-owners who even
authorized and represented to CAA that
Atanacio Godinez was their attorney-in-
fact.” “Even granting for the sake of argument
40

that Atanacio Godinez was not in fact authorized

by the other registered co-owners to execute a
deed conveying Lot Nos. 4810-A and 4810-B to
CAA, such defect has nevertheless been cured
when his co-owners subsequently executed on
September 17, 1969 a public document
 denominated as Deed of Partition.” As to the
41

nonpayment of consideration, the OSG contends

that such allegation cannot be established by
mere testimonial evidence and that it must be
proved by clear, positive and convincing
evidence. Moreover, “not only are private
42

transactions presumed to be fair and regular and

that the ordinary course of business presumed
to have been followed but, also, government
employees are presumed to have regularly
performed their official duties. In this case,
Unchuan has not overcome the foregoing legal
presumptions.” 43

The OSG further avers that “the absence of

the signature of Administrator Caldoza on the
challenged Deed of Absolute Sale should, at
best, be treated as a mere formal defect which
should not affect the very substance of the
contract” bearing
44

_______________
40 Id., at p. 685.
41 Id., at p. 686.
42 Id., at p. 691.
43 Id., at pp. 691-692.
44 Id., at p. 696.

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in mind that “a contract of sale is a consensual
contract.” The OSG likewise posits that “assuming
45

arguendo that petitioner does not possess any title

or right whatsoever over the above parcels of land,
its possession is justified by extraordinary
prescription.” It also claims that laches had set in
46

against the original registered owners for their

failure to question the validity of the sale for over
forty-six (46) years after the sale transaction
between CAA and Atanacio in 1958. Thus, “the
47

laches of the original registered owners extend to

Unchuan since he stands in privity with his
predecessors-in-interest.”48

The OSG insists that extrinsic fraud was committed

against it as Atty. Sigfredo Dublin (Atty. Dublin), the
legal manager of CAA, withheld from their office,
while the trial was ongoing, the information that on
October 9, 1998, he had caused the annotation of an
adverse claim on OCT No. RO-1173. The OSG asserts
that it was significant because the deed of absolute
sale between Unchuan and the alleged heirs of the
registered owners was executed only on December 7,
1998. Also suppressed from the OSG, as it claims,
were the following:

1. Deed of Absolute Sale executed between Atanacio

Godinez and the CAA bearing the signature of Urbano
B. Caldoza, then CAA Administrator.
2. Joint Affidavit of Confirmation of Sale of Allotted
Shares Already Adjudicated and Quitclaim of a
Portion of Lot No. 4810, Open Cadastre, executed by
the heirs of Juana Godinez.
3. Extra-Judicial Declaration of Partition and
Adjudication executed by Tomasa Godinez, Atanacio
Godinez, Mamerta Inot (for Ambrosio Godinez), Pedro
Pino (for
_______________
45 Id., at p. 695.
46 Id., at p. 703.
47 Id., at pp. 703-704.
48 Id., at p. 705.

596
596 SUPREME COURT REPORTS ANNOTATED
Mactan-Cebu International Airport Authority vs.
Unchuan

Sotera Godinez) and Corazon Epe (for Fernanda

Godinez).
4. Provincial Voucher, dated October 3, 1958 (and its
attachments) evidencing payment of the
consideration for the sale of Lot Nos. 4810-A and
4810-B.

The OSG argues that these documents are very

important and material to petitioner’s def ense and
should be admitted to prevent a miscarriage of
justice.

The Court’s Ruling

The RTC decision, as affirmed by the CA, needs to be

modified.
The Court finds that the sale transaction executed
between Atanacio, acting as an agent of his fellow
registered owners, and the CAA was indeed void
insofar as the other registered owners were
concerned. They were represented without a written
authority from them clearly in violation of the
requirement under Articles 1874 and 1878 of the Civil
Code, which provide:

Art. 1874. When a sale of a piece of land or any

interest therein is through an agent, the authority of
the latter shall be in writing; otherwise, the sale
shall be void.
Art. 1878. Special powers of attorney are necessary
in the following cases:
xxx
(5) To enter into any contract by which the ownership
of an immovable is transmitted or acquired either
gratuitously or for a valuable consideration.
xxx

597
 VOL. 791, JUNE 1, 2016 597
Mactan-Cebu International Airport Authority vs.
Unchuan

The significance of requiring the authority of an

agent to be put into writing was amplified in Dizon v.
Court of Appeals: 49

When the sale of a piece of land or any interest

thereon is through an agent, the authority of the
latter shall be in writing; otherwise, the sale shall be
void. Thus the authority of an agent to execute a
contract for the sale of real estate must be conferred
in writing and must give him specific authority,
either to conduct the general business of the
principal or to execute a binding contract containing
terms and conditions which are in the contract he
did execute. A special power of attorney is necessary
to enter into any contract by which the ownership of
an immovable is transmitted or acquired either
gratuitously or for a valuable consideration. The
express mandate required by law to enable an
appointee of an agency (couched) in general terms to
sell must be one that expressly mentions a sale or
that includes a sale as a necessary ingredient of the
act mentioned. For the principal to confer the right
upon an agent to sell real estate, a power of attorney
must so express the powers of the agent in clear and
unmistakable language. When there is any
reasonable doubt that the language so used conveys
such power, no such construction shall be given the
document.

Without a special power of attorney specifying his

authority to dispose of an immovable, Atanacio could
not be legally considered as the representative of
the other registered co-owners of the properties in
question. Atanacio’s act of conveying Lot No. 4810-A
and Lot No. 4810-B cannot be a valid source of
obligation to bind all the other registered co-owners
and their heirs because he was not clothed with any
authority to enter into a contract with CAA. The other
heirs could not
_______________
49 444 Phil. 161, 165-166; 396 SCRA 151, 155 (2003), citing
Cosmic Lumber Corp. v. Court of Appeals, 332 Phil. 948, 957-958;
265 SCRA 168, 176 (1996).

598
598 SUPREME COURT REPORTS ANNOTATED
Mactan-Cebu International Airport Authority vs.
Unchuan

have given their consent as required under Article

1475 of the New Civil Code because there was no
50

meeting of the minds among the other registered co-

owners who gave no written authority to Atanacio to
transact on their behalf. Therefore, no contract was
perfected insofar as the portions or shares of the
other registered co-owners or their heirs were
concerned.
Thus, the Court cannot give any weight either to the
Deed of Partition of Lot No. 4810, Open Cadastre 51

(subsequently executed by all the heirs of Ambrosio

and Sotera Godinez to the effect that they had
acknowledged the sale of the subject lots in favor of
52

CAA) or to other documents (such as Joint Affidavit

of Confirmation of Sale of Allotted Shares Already
Adjudicated and Quitclaim of a Portion of Lot No.
4810, Open Cadastre) all of which gave the
53

impression that they had ratified the sale of the

54

subject lots in favor of CAA, MCIAA’s predecessor-in-

interest.
_______________
50 Art. 1475. The contract of sale is perfected at the
moment there is a meeting of minds upon the thing which is the
object of the contract and upon the price.
From that moment, the parties may reciprocally demand
performance, subject to the provisions of the law governing the
form of contracts.
51 Rollo, pp. 506-507.
52 Lot No. 4810-A with an area of ONE HUNDRED SEVENTY-
SEVEN THOUSAND ONE HUNDRED SEVENTY-SIX (177,176) square
meters and Lot No. 4810-B, with [an] area of TWO THOUSAND
SEVEN HUNDRED FORTY (2,740) square meters, are owned by the
Civil Aeronautics Administration, having bought the same from
the original owners.
53 Rollo, pp. 474-475.
54 3. That this affidavit is jointly executed by US, the
undersigned affiants, to establish the fact of sale and
conveyance of a portion of Lot 4810 by the heirs of JUANA
GODINEZ, specifically the area of some 177,173 sq. meters, more
or less, of Lot 4810, to the CAA Mactan Airport, Lapu-Lapu City,
Philippines; confirming voluntarily said conveyance; quitting
forever whatever right, interest

599
VOL. 791, JUNE 1, 2016 599
Mactan-Cebu International Airport Authority vs.
Unchuan

The rule is that a void contract produces no effect

either against or in favor of anyone and cannot be
ratified. Similarly, laches will not set in against a
55

void transaction, as in this case, where the agent did

not have a special power of attorney to dispose of
the lots co-owned by the other registered owners. In
fact, Article 1410 of the Civil Code specifically
provides that an action to declare the inexistence of
a void contract does not prescribe.
The transaction entered into by Atanacio and CAA,
however, was not entirely void because the lack of
consent by the other co-owners in the sale was with
respect to their shares only. Article 493 of the New
Civil Code expressly provides:

Art. 493. Each co-owner shall have the full

ownership of his part and the fruits and benefits
pertaining thereto, and he may therefore alienate,
assign or mortgage it, and even substitute another
person in its enjoyment, except when personal rights
are involved. But the effect of the alienation or the
mortgage, with respect to the co-owners, shall be
limited to the portion which may be allotted to him in
the division upon the termination of the co-
ownership.

The quoted provision recognizes the absolute right of

a co-owner to freely dispose of his pro indiviso share
as well as the fruits and other benefits arising from
that share, independently of the other co-owners.
The sale of the subject lots affects only the seller’s
share pro indiviso, and the transferee gets only what
corresponds to his grantor’s share in the partition of
the property owned in common. Since a co-owner is
entitled to sell his undivided share, a sale of the
entire property by one co-owner without the consent
of the other co-
_______________
and participation we have or we may have over the remaining
portion of 55,426 sq. meters, of Lot 4810, by reason of the said
sale and conveyance by the said heirs of JUANA GODINEZ.
55 Roberts v. Papio, 544 Phil. 280, 303; 515 SCRA 346, 371
(2007).

600
600 SUPREME COURT REPORTS ANNOTATED
Mactan-Cebu International Airport Authority vs.
Unchuan
owners is not null and void; only the rights of the co-
owner/seller are transferred, thereby making the
buyer a co-owner of the property. 56

In the case at bench, although the sale transaction

insofar as the other heirs of the registered owners
was void, the sale insofar as the extent of Atanacio’s
interest is concerned, remains valid. Atanacio was
one of the registered co-owners of the subject lots,
but he was not clothed with authority to transact for
the other co-owners. By signing the deed of sale with
the CAA, Atanacio effectively sold his undivided
share in the lots in question. Thus, CAA became a co-
owner of the undivided subject lots. Accordingly,
Atanacio’s heirs could no longer alienate anything in
favor of Unchuan because he already conveyed
his pro indiviso share to CAA.
The Court does not accept either Unchuan’s
allegation that no payment was received for the
transaction between Atanacio and CAA. Section 3,
Rule 131 of the Rules of Court identifies the following
as disputable presumptions: (1) private transactions
have been fair and regular; (2) the ordinary course of
business has been followed; and (3) there was
sufficient consideration for a contract. A
presumption may operate against a challenger who
has not presented any proof to rebut it. “The effect of
a legal presumption upon a burden of proof is to
create the necessity of presenting evidence to meet
the legal presumption or the prima facie case
created thereby, and which, if no proof to the
contrary is presented and offered, will prevail. The
burden of proof remains where it is, but by the
presumption, the one who has that burden is relieved
for the time being from introducing evidence in
support of the averment, because the presumption
stands in the place of evidence unless
rebutted.” Atanacio, by affixing his signa-
57

_______________
56 Fernandez v. Fernandez, 416 Phil. 322, 343; 363 SCRA 811,
829 (2001).
57 Surtida v. Rural Bank of Malinao (Albay), Inc. , 540 Phil. 502,
514-515; 511 SCRA 507, 519-520 (2006).

601
VOL. 791, JUNE 1, 2016 601
Mactan-Cebu International Airport Authority vs.
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ture on the deed of absolute sale, a disputable

presumption arose that consideration was paid. A
mere allegation that no payment was received is not
sufficient to dispel such legal presumption.
Furthermore, the record shows an official
communication, dated October 8, 1958, from the
District Land Office of Cebu to the Provincial
Treasurer of Cebu stating that Provincial Voucher No.
05358 was disbursed in favor of Atanacio. 58
Consequently, the Court deems it just and fair to
modify the disposition of the subject lots to
Unchuan. Unchuan is not entitled to the whole
179,916 square meters of the property, as originally
awarded by the RTC and affirmed by the CA.
Atanacio’s share should be excluded from the
computation as his heirs were already precluded
from further conveying what he, their predecessor-in-
interest, had previously sold to CAA. Thus, Unchuan
is only legally entitled to an unidentified 149,930
square meters of the property after excluding
Atanacio’s unidentified share of 29,986 square
meters.
The Court notes that the lots in question were
formerly undeveloped lands, but now form part of the
Mactan-Cebu International Airport. It is, thus, being
used for a public purpose. It being the situation, the
government or the MCIAA should initiate
expropriation proceedings so that the registered
owners or successors-in-interest would be
compensated for their undivided shares in the lots
taken from them. In the meantime, MCIAA should pay
rentals thereon, after these shall have been
identified and segregated, at the rate of P20.00 per
square meter to be reckoned from the filing of the
complaint.
WHEREFORE, the petition is PARTIALLY GRANTED.
The November 29, 2007 Decision and the March 25,
2008 Resolution of the Court of Appeals (CA) in C.A.-
G.R. CV No. 01306 are AFFIRMED with
MODIFICATION. Accordingly, the dispositive portion
of the decision should read as follows:
_______________
58 Rollo, p. 505.

602
602 SUPREME COURT REPORTS ANNOTATED
Mactan-Cebu International Airport Authority vs.
Unchuan

WHEREFORE, judgment is hereby rendered

declaring that:
a. The Deed of Sale signed by Atanacio
Godinez alienating the lands denominated as Lot
No. 4810-A and Lot No. 4810-B in favor of
MCIAA’s predecessor-in-interest is VALID,
insofar as his undivided share in the said lots is
concerned, but VOID, insofar as the undivided
shares of the other registered owners, who did
not sign the deed, are concerned; and
b. Plaintiff Richard E. Unchuan is the true and
legal owner of portions of Lot No. 4810-A and Lot
No. 4810-B consisting of One Hundred Forty-Nine
Thousand Nine Hundred Thirty (149,930) Square
Meters.
The Register of Deeds of Lapu-Lapu City is
hereby ordered to annotate in OCT No. RO-1173
the respective rights of Richard E. Unchuan and
 the Mactan-Cebu International Airport Authority
in the said property.
The Mactan-Cebu International Airport
Authority is ordered to initiate expropriation
proceedings over the undivided portions of Lots
No. 4810-A and 4810-B covering the said 149,930
Square Meters.
In the meantime, Mactan-Cebu International
Airport Authority is ordered to pay the sum of
P20.00 per square meter per month as rental for
the use of the property reckoned from the time
of the filing of the complaint until its final
payment for the same.

603
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Unchuan

No pronouncement as to the cost of the suit.

SO ORDERED.
Carpio (Chairperson), Del Castillo and Leonen,
JJ.,
concur.
Brion, J., On Official Leave.
Petition partially granted, judgment and resolution
affirmed with modification.
 Notes.—Where the co-owners affixed their
signatures on the Contract to Sell, they were no
longer selling their shares through an agent but,
rather, they were selling the same directly and in
their own right — a written authority is no longer
necessary to empower an agent. (Oesmer vs. Paraiso
Development Corporation, 514 SCRA 228 [2007])
The well-established rule is when a sale of a
parcel of land or any interest therein is through an
agent, the authority of the latter shall be in writing,
otherwise the sale shall be void. ( Bautista-Spille vs.
Nicorp Management and Development Corporation,
773 SCRA 67 [2015])

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