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Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
AT A GLANCE:
A Special Power of Attorney (SPA) is automatically extinguished upon the death of the principal, rendering any subsequent acts by the agent void, unless the SPA was constituted in the common interest of the principal and agent, or a third party who accepted the stipulation in his favor.
By the contract of agency, a person binds himself to render some service or to do something in representation or on behalf of another, with the consent or authority of the latter. The relationship of agency is one where a party, called the “principal”, authorizes another, called the “agent”, act for and in his [or her] behalf in transactions with third persons. (Sps. Yulo v. Bank of the Philippine Island, G.R. No. 217044, January 16, 2019)
The essential elements of agency are:
- there is consent, express or implied, of the parties to establish the relationship;
- the object is the execution of a juridical act in relation to a third person;
- the agent acts as a representative and not for himself or herself; and
- the agent acts within the scope of his or her authority. (Rallos v. Felix Go Chan & Sons Realty Corporation, G.R. No. L-24332 January 31, 1978)
What is the effect of the death of the Principal to a Special Power of Attorney?
One of the modes of extinguishing a contract of agency is by the death of either the principal or the agent.
Thus, an SPA automatically ends with the death of the person who granted it, and any acts carried out by the agent afterward are void, unless covered by narrow exceptions under the law.
In the case of San Miguel Foods, Inc. v. Alova (G.R. No. 260071, May 7, 2025), the Supreme Court held that agency is basically personal, representative, and derivative in nature. The authority of the agent to act emanates from the powers granted to him by his or her principal. The agent’s act is the act of the principal if done within the scope of the authority.
Owing to its nature, agency is extinguished by the death of either the principal or the agent. Thus, any act by the agent subsequent to the principal’s death is void ab initio, unless the act fell under the exceptions established under Articles 1930 and 1931 of the Civil Code which provides:
“Article 1930. The agency shall remain in full force and effect even after the death of the principal, if it has been constituted in the common interest of the latter and of the agent, or in the interest of a third person who has accepted the stipulation in his favor.
Article 1931. Anything done by the agent, without knowledge of the death of the principal or of any other cause which extinguishes the agency, is valid and shall be fully effective with respect to third persons who may have contracted with him in good faith.”
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Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries regarding legal services, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/ 09175772207/ 09778050020.
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