Special power

Dear Atty. Angela,

In 2022, my father executed a Special Power of Attorney to my cousin authorizing her to manage his real estate properties. However, my father died in 2024, or two years after the SPA. Despite this, my cousin still used the SPA this year to secure a credit line from a poultry company through a mortgage using my father’s properties. Her business failed and now the company is running after my father’s properties. Is this legal and can the company take ownership of the properties by reason of the SPA?

Vengie

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Dear Vengie,

No, the company has no legal claim over the properties. It is clear that your cousin no longer has a right of administration over the properties as the Special Power of Attorney (SPA) automatically ends with the death of the person who granted it, and any acts carried out by the agent afterward are void.

In the case of San Miguel Foods Inc. v. Alova and Pution, G.R. No. 260071 (7 May 2025), the Supreme Court explained that under an SPA, which is a contract of agency, a principal authorizes an agent to act on his or her behalf in transactions with third persons. Agency is personal, representative, and derivative, and it ends upon the death of either the principal or the agent.

Any act by the agent after the principal’s death is void, unless it falls under two Civil Code exceptions: (1) when the agency was for the parties’ common interest, and (2) when the agent, unaware of the death or agency’s end, contracted with a third party in good faith.

In this case, there was no showing that these exceptions were applicable. Your cousin was fully aware of your father’s death, and the SPA was not made for their common interest or mutual benefit.

The SC reiterated that for an agent’s act to bind the principal, the contract must clearly be made, signed, and sealed in the principal’s name. Here, the mortgage was signed only by your cousin in her personal capacity nor was the mortgage executed in the name of your father who is deemed the real principal.

Atty. Angela Antonio