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ANTONIO PRATS V COURT OF APPEALS

Antonio Prats sued Alfonso Doronila to recover commission from the sale of Doronila's land to SSS. [1] Doronila had given Prats an exclusive option to negotiate the sale, with 10% commission. [2] Prats' efforts included offers to SSS, but no sale occurred during the option period. [3] After the option expired, Doronila negotiated directly with SSS and sold the land. The Court of Appeals found Prats was not the procuring cause, but the Supreme Court granted Prats PHP 100,000 in equity for his efforts.

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199 views

ANTONIO PRATS V COURT OF APPEALS

Antonio Prats sued Alfonso Doronila to recover commission from the sale of Doronila's land to SSS. [1] Doronila had given Prats an exclusive option to negotiate the sale, with 10% commission. [2] Prats' efforts included offers to SSS, but no sale occurred during the option period. [3] After the option expired, Doronila negotiated directly with SSS and sold the land. The Court of Appeals found Prats was not the procuring cause, but the Supreme Court granted Prats PHP 100,000 in equity for his efforts.

Uploaded by

Rani Mae
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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ANTONIO PRATS v.

COURT OF APPEALS
G.R. No. L-39822, 31 January 1978, FIRST DIVISION (FERNANDEZ, J.)

EMERGENCY RECIT: Doronila offered to sell his property to SSS. However, he withdrew his offer to SSS and assigned
Prats instead to sell his land within a given period to exercise his exclusive option to sell. Prats negotiated the property
to SSS. Eventually, a sale was consummated with the SSS. Prats was asking for his commission but Doronila did not
complied with his demand.

Doronila was ordered in the RTC to pay Prats P1.380M based on an alleged exclusive option and authority to
negotiate the sale of Doronila’s property. CA reversed. SC said that there was no evidence that shows that Prats was the
efficient procuring cause in bringing about the sale, hence he is not entitled to the commission which was awarded by
the RTC. However, he was awarded an amount in the interest of equity.

FACTS:

Antonio Prats, doing business under the name Philippine Real Estate Exchange, instituted against Alfonso
Doronila and Philippine National Bank an action to recover sum of money and damages in the CFI of Rizal.

Doronila was the registered owner of a 300-hectare land in Rizal. He offered to sell such land to the Social
Security System (SSS) for PHP 4.00/sq. m. SSS made a counter-offer of PHP 3.25/sq. m. Doronila then gave Prats an
exclusive option and authority in writing to negotiate the sale of the property under the following terms:

a. Prats is to sell the land at a basic price of PHP 3.00/sq. m.


b. A 10% commission shall be paid to Prats based on PHP 2.10/sq. m. or at any price finally agreed upon and if the
property be sold over and above PHP 3.00/sq. m., the excess shall be paid to Prats in addition to his 10%
commission.
c. Such exclusive option and authority is good for (60) days from the date of conformity; provided that should
negotiations with the buyer have been started, said period is automatically extended until said negotiations is
terminated, but not more than (15) days.
d. The written offers must be made by the prospective buyers and if no written offer is made to Doronila until the
last day of this authorization, this option and authority shall expire and become null and void.
e. Prospective buyers and all parties interested shall be referred to Prats.

As a result of this exclusive option and authority to negotiate, Doronila withdrew his previous offer to sell to SSS
and asked for the return of all papers concerning his offered property. These papers were given to Prats as Doronila’s
authorized real estate broker. Subsequently, Doronila was invited by SSS to have a meeting but the former declined and
asked that SSS communicate directly with Prats. Prats wrote SSS signifying his intentions to sit down and meet with the
latter.

Doronila extended Prat’s exclusive option and authority up to May 18. On May 6, 1968, Prats made a formal
written offer to the SSS at the price of PHP6.00/sq. m. SSS ignored said offer. On May 18, 1968, Prats wrote to Doronila
emphasizing that they still had (15) days within which to complete the negotiations as per agreement or until June 2.
Prats wrote to Doronila again advising him that the SSS agreed to purchase the land, though no formal offer was made
by the latter.

Doronila wrote to Prats informing him that he has not received any written offer from the SSS during the 60 days
of the exclusive option and authority which expired on April 14, nor during the period of extension which expired on
May 18, nor during the 15-day grace period. As per their agreement, the option expired and became null and void.
Eventually, Doronila wrote to SSS renewing his offer to sell the land at PHP 4.00/sq. m. SSS replied and made a
counter-offer of PHP 3.25/sq. m., for a total price of P9,750,000.00. Doronila accepted the counter-offer and executed
the deed of absolute sale.

Prats presented his statement of account to Doronila for the payment of his professional services as real estate
broker in the amount of P1,380,000.00. Doronila refused to pay. Hence, a suit was filed.

RTC ruled in favor of Prats, ordering Doronila to pay the commission plus damages. However, the CA reversed
the ruling of the lower court. As per the agreement, a written offer by the prospective buyer was required and if no such
written offer is made until the last day of the authorization, the option shall expire. The CA emphasized the significance
or a written offer to save the authority from an automatic termination. It added that negotiations are deemed started
when a response is given by the prospective buyer showing his interest to buy the property.

ISSUE:

WON CA erred in concluding that Prats was not the efficient procuring cause in bringing about the sale of
Doronila’s land to SSS and as such should not be entitled to his commission.

RULING:

NO, the CA is correct. It is clear from the stipulation of facts and evidence on record that the offer of Doronila to
sell the land to SSS was formally accepted by SSS only on June 20, 1968 after the exclusive option had already expired.
Prats was not the efficient procuring case in bringing about the sale proceeding from the fact of expiration of his
exclusive option.

This is manifested by the fact that the SSS officials specifically requested Prats not to be present at the meeting
with Doronila on May 29 because the SSS officials never wanted the mediation or intervention of Prats. The conclusion is
that this May 29 meeting was done independently and not by virtue of Prat’s wish or efforts to hold such meeting.

The fact that Prats also made offers of PHP 4.50/sq. m. and PHP 6.00/sq. m. belies the claim that he arranged
the May 29 meeting as SSS was only willing to buy it at PHP 3.25/sq. m. Prats’ offers to SSS received no attention.

However, the Court took note that Prats had taken steps to bring back together Doronila and SSS. Prats wrote
several letters to SSS offering the land and inviting them to discuss the offer. He even made a former offer of PHP
6.00/sq. m., albeit it was ignored. Prats had several dinner and lunch meetings with Doronila and his nephew Atty.
Asencio. The latter corroborated this fact.

As such, the Court granted in equity a sum of PHP 100,000.00 by way of compensation for Prats’ efforts and
assistance in the transaction, which however was finalized and consummated after the expiration of his exclusive option.

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