FACTS:

Spouses Antonio and Joselina Alcantara and Spouses Josefino and Annie Rubi (petitioners) entered into an oral agreement with Brigida L. Nido (respondent), acting as administrator and attorney-in-fact of Revelen N. Srivastava, to purchase a portion of unregistered land owned by Revelen. Petitioners paid a downpayment and constructed houses on the land. However, petitioners defaulted on their installment payments. Respondent, on behalf of Revelen, filed a complaint for recovery of possession with damages and preliminary injunction against petitioners. The trial court declared the oral contract void and ordered mutual restitution. On appeal, the appellate court reversed the trial court's decision, stating that the case pertains to unlawful detainer and the trial court had no jurisdiction over the case. The appellate court also held that the contract entered into between petitioners and respondent is void as it lacked a written authority. Aggrieved, petitioners filed a Petition for Review before the Supreme Court, arguing that the contract is voidable and should be subject to specific performance.

ISSUES:

1. Whether the contract entered into by respondent, in representation of her daughter, and former defendant Eduardo Rubi, is void.

2. Whether petitioners are entitled to their counterclaim for specific performance.

RULING:

1. The Court denied the petition. The appellate court did not err in ruling that the contract entered into by respondent is void. The sale of land by an agent who has no written authority is void under Article 1874 of the Civil Code. Without a written authority, the agent cannot validly sell the property. Therefore, the contract entered into between petitioners and respondent is void and cannot be the subject of rescission. As for the counterclaim for specific performance, the court could not rule on it since there is no proof that petitioners have fully paid the price of the lot.

PRINCIPLES:

• A sale of land by an agent who has no written authority is void under Article 1874 of the Civil Code.

• A void contract produces no effect either against or in favor of anyone and cannot be ratified.