Claudio Delos Reyes v. The Hon. Court of Appeals

Summary

The Supreme Court addressed the validity of an oral contract of sale involving a 300 square meter portion of land registered under Daluyong Gabriel's name, sold by his son Renato Gabriel to the delos Reyes spouses for P90,000.00. The Court affirmed the Court of Appeals' ruling that the contract was null and void ab initio due to Renato Gabriel's lack of legal capacity to enter into the sale, as he was neither the owner nor duly authorized agent of the registered owner. However, applying principles of equity and unjust enrichment, the Court ordered Renato Gabriel to refund the P90,000.00 purchase price already paid by the buyers. The decision establishes that under Article 1874 of the Civil Code, authority to sell real property through an agent must be in writing, and emphasizes that contracts lacking essential requisites under Article 1318 are void, but performed void contracts require restitution to prevent unjust enrichment.