Af Realty & Development v. Dieselman Freight Services

Summary

This case involves competing claims to a commercial property in Pasig City between AF Realty and Midas Development Corporation. AF Realty claimed to have purchased the property through unauthorized agents of Dieselman Freight Services, while Midas purchased directly from Dieselman through proper corporate authorization. The Supreme Court applied Civil Code Article 1874, which requires written authority for land sales through agents, ruling that the AF Realty transaction was void due to the lack of proper authorization from Dieselman's board of directors. The Court emphasized that corporate powers must be exercised by the board of directors and that unauthorized individual directors cannot bind the corporation. The Midas sale was upheld as valid, being properly authorized by board resolution. The case establishes important precedent on corporate agency authority in real estate transactions and the strict requirement of written authorization for land sales through agents.