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SALLY YOSHIZAKI v. JOY TRAINING CENTER OF AURORA

FACTS:

The case involves a dispute over the ownership and sale of certain real properties owned by respondent Joy Training Center of Aurora, Inc. (Joy Training). The spouses Richard and Linda Johnson sold the real properties, a Wrangler jeep, and other personal properties to the spouses Sally and Yoshio Yoshizaki on November 10, 1998. Joy Training, represented by its Acting Chairperson Reuben V. Rubio, then filed an action for the Cancellation of Sales and Damages against the spouses Yoshizaki and Johnson before the Regional Trial Court (RTC). Joy Training alleged that the sale was unauthorized. The spouses Yoshizaki claimed that the sale was authorized by Joy Training, and argued that the RTC had no jurisdiction over the case as it should have been filed with the Securities and Exchange Commission (SEC). The RTC ruled in favor of the spouses Yoshizaki, finding that the sale was valid and that the RTC had jurisdiction. Joy Training appealed to the Court of Appeals (CA), which reversed the RTC's ruling with respect to the sale of the real properties. The CA held that the sale was unauthorized as it was not approved by a majority of the board of trustees of Joy Training. The CA also upheld the RTC's jurisdiction over the case. The spouses Yoshizaki filed a petition for review before the Supreme Court, challenging the CA's ruling.

ISSUES:

  1. Whether the RTC has jurisdiction over the present case.

  2. Whether the Supreme Court may review questions of fact in a petition for review on certiorari.

  3. Whether there is a contract of agency between Joy Training and the spouses Johnson to sell the parcel of land with its improvements.

  4. Whether the contract of agency to sell the real properties exists.

  5. Whether the secondary evidence presented by the spouses Yoshizaki is admissible.

  6. Whether the contract of sale is enforceable.

  7. Whether Sally, the buyer, is a buyer in good faith.

RULING:

  1. The RTC has jurisdiction over the present case. The determination of the existence of a contract of agency and the validity of a contract of sale requires the application of the relevant provisions of the Civil Code, which are properly cognizable by courts of general jurisdiction.

  2. The Supreme Court may review questions of fact in a petition for review on certiorari when the findings of fact by the lower courts are conflicting.

  3. There is no contract of agency between Joy Training and the spouses Johnson to sell the parcel of land with its improvements. A contract of agency must be in writing when the law requires a specific form, such as the sale of a piece of land or any interest therein. The special power of attorney must expressly mention a sale or include a sale as a necessary ingredient of the authorized act. In this case, the documents presented by Sally failed to prove that Joy Training specially authorized the spouses Johnson to sell the real properties.

  4. The contract of agency to sell the real properties does not exist.

  5. The secondary evidence presented by the spouses Yoshizaki is inadmissible.

  6. The contract of sale is unenforceable.

  7. Sally, the buyer, is not a buyer in good faith.

PRINCIPLES:

  • The general rule is that no evidence shall be admissible other than the original document itself when the subject of inquiry is the contents of a document, unless the production of secondary evidence falls under the exceptions enumerated in the Rules of Court.

  • The determination of the board of trustees' composition is based on the trustees as fixed in the articles of incorporation, and not the actual members of the board.

  • An agency couched in general terms comprises only acts of administration, unless expressly authorized otherwise.

  • Persons dealing with an agent must ascertain not only the fact of agency, but also the nature and extent of the agent's authority. The buyer bears the risk of injury occasioned by their transaction with the agent.