Dear Attorney,

I am reaching out to seek legal advice regarding a property transaction I am involved in. I recently checked the title of a piece of land through the Registry of Deeds, and it is currently registered under the name of a corporation. However, the deed of sale presented to me is signed by an individual, who claims to be selling the same land. The title number on the deed of sale matches that of the title under the corporation’s name.

Given this discrepancy, I would like to ask if the contract between me and the seller is binding. Should I proceed with the transaction under these circumstances? I am concerned about the legal implications of purchasing land from an individual when the title is under a corporate entity.

I would greatly appreciate your guidance on this matter.

Sincerely,
Concerned Buyer

Insights

The concern raised here involves a potential issue with the authority of the person selling the land, as the title to the property is registered under a corporation, yet the deed of sale is executed by an individual. This discrepancy is crucial and must be clarified before proceeding with the transaction. Below are some key insights into the situation:

Authority to Sell
In the Philippines, if a property is titled under a corporation, only the corporation itself, through its authorized representatives, can execute the sale. This authorization is typically formalized through a board resolution or a secretary’s certificate that explicitly grants an individual (often a corporate officer) the authority to represent the corporation in the sale of its property. If this authorization is absent, the individual signing the deed of sale may not have the legal right to transfer ownership, making the contract voidable or even null and void from the start. It is essential to verify if the individual seller has the proper authorization from the corporation.
Due Diligence
Before proceeding, you must conduct thorough due diligence by requesting the following:
- A board resolution or a secretary’s certificate that names the individual as the authorized representative of the corporation for the transaction.
- The certificate of title issued by the Registry of Deeds to ensure that the corporation is indeed the legal owner of the property.
- The corporation’s articles of incorporation and bylaws, which may contain provisions on who can act on behalf of the corporation regarding property transactions.
Risk of Contract Invalidity
If the individual selling the property does not have the authority to do so, the sale may be deemed invalid. Without the proper authorization, the corporation is not bound by the actions of the individual seller. This could expose you to future legal disputes, including claims by the corporation or third parties with an interest in the property.
Remedies and Next Steps
Should you find that the individual seller lacks authority, it is advisable to refrain from completing the transaction. If payments have already been made, legal remedies such as rescission of the contract and the return of payments may be necessary. Consulting with a real estate lawyer to assist with document verification and contract review would be the best course of action to ensure that your rights are protected.

In conclusion, while the matching title numbers might suggest that the correct property is being sold, the issue of authority remains critical. Proceed with caution, and do not hesitate to obtain legal assistance to safeguard your interests.