Ticongs vs. Malim, et al., G.R. Nos.: 220785 & 222887, March 1, 2017
Facts:
Manuel Malim, Minda Abangan, and May Macal (respondents) were real estate brokers/dealers, authorized by Lorenzo, Patrocinio, and Wilma Ticong (petitioners) to sell several parcels of land in Digos, Davao del Sur through a Memorandum of Agreement (MOA) dated February 11, 2000.
The MOA allowed the respondents to sell the properties for P900.00 per square meter, with the option to charge an overprice. The properties were eventually sold for P1,460.00 per square meter, and the respondents claimed an overprice commission of P2.8 million based on the P560.00 per square meter overprice.
The Ticongs paid the respondents P50,000.00 but refused to pay the balance of the claimed commission, leading the respondents to file a lawsuit for collection of the unpaid amount.
The Regional Trial Court (RTC) upheld the validity of the MOA, recognizing the respondents as authorized agents and procuring cause of the sale. The court awarded the respondents P2.75 million as commission, with interest, and P100,000.00 in attorney’s fees.
The Court of Appeals (CA) affirmed the RTC’s decision, ruling that the respondents were entitled to the commission, as they were the procuring cause of the sale.
Issue:
Whether or not the respondents were entitled to the overprice commission for being the procuring cause of the sale between the Ticongs and the Buyer.
Ruling:
The Supreme Court upheld the RTC and CA decisions, concluding that the respondents were indeed the procuring cause of the sale, as they introduced the Buyer to the Ticongs and facilitated negotiations. Therefore, they were entitled to the P2.8 million overprice commission.
In this case, the role of the respondents in the successful consummation of the sale transaction is undisputed. Indeed, the evidence on record shows that the respondents were instrumental in the sale of the properties of the Ticongs. Without their intervention, no sale would have been consummated. They were the ones who set the sale of the said lots in motion. If not for the respondents, the Buyer would not have known about the lots being sold by the Ticongs.
The Court emphasized that the MOA, which allowed for the overprice, was valid and binding. The Ticongs’ argument that the respondents were not licensed brokers was dismissed, as the lack of a license did not nullify the sale or the validity of the MOA.
Doctrine:
The “procuring cause” refers to the agent’s efforts that directly lead to the successful sale of a property. If the agent’s actions are the foundation of the sale, they are entitled to their commission, regardless of any interruptions or disputes.
Read the full text of the Decision at: https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/62892
Real LexEcon 