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ROBERTO R. IGNACIO and TERESA R. IGNACIO doing business under the name and style TERESA R. IGNACIO ENTERPRISES vs. MYRNA P. RAGASA and AZUCENA B. ROA,
G.R. No. 227896, Jan. 29. 2020, Justice Peralta
FACTS:
On January 11, 2000, petitioners (Ignacio) engaged, on an exclusive basis, the services of the respondents, who are both licenses real estate brokers, to look for and negotiate with a person or entity for a joint venture project involving petitioners’ undeveloped lands in Mindanao Avenue, Quezon City and the developed subdivision sites in Las Piñas City, Parañaque City, and Bacoor. The contract was embodied in the Authority to Look and Negotiate for a Joint Venture Partner, effective six months from January 10, 2000, or until July 10, 2000. The said Authority provided that the petitioners will pay the respondents a commission equivalent to five percent (5%) of the price of the properties.
On January 13, 2000, respondents met with Mr. Porfirio Yusingbo, Jr. (Yusingbo), the General Manager of Woodridge Properties, Inc. (Woodridge), and they presented him the different subdivisions and project sites available for investment. After inspecting the properties, Yusingbo expressed Woodridge’s interest in acquiring and developing the Krause Park and Teresa Park properties.
As a result, Woodridge sent respondents a formal proposal dated January 21, 2000 for a joint venture agreement with the petitioners covering the Teresa Park. The proposal was sent by the respondents to the petitioners via facsimile. On January 25, 2000, the petitioners met with the representative of Woodridge to discuss the prices of the properties, and Woodridge likwise intimated that it would develop both the Krause Park and the Teresa Park.
On February 4, 2000, respondents met again with Yusingbo and Mr. Elmer Loredo (Loredo), Woodridge’s broker, to discuss Woodridge’s proposal for bulk puchase covering the Teresa Park, including the terms of payment. On February 9, 2000, respondents presented Woodridge’s offer to petitioner Robert Ignacio. They discussed the projected cash inflows and the advantages of the scheme. Petitioner Ignacio said he wanted to sell the lots in batches at a lower volume, instead of in bulk. Respondents communicated the offer to Woodridge and the latter intimated that it will make a revised offer. On March 9, 2000, Woodridge, however, changed its offer from direct acquisition to joint venture, covering 200 lots in Teresa Park, and sent the proposal to the respondents, who, in turn, relayed it to the petitioners. In a meeting on March 13, 2000, petitioners and respondents discussed the proposal for joint venture. Petitioners commented that Woodridge’s offer was too low, but respondents reassured them that the could negotiate for a better price. After this March 13, 2000 meeting, however, petitioners stopped communicating with the respondents. Several attempts were made by the respondents to contact the petitioners to follow-up on the proposal of Woodridge, but to no avail.
Sometime thereafter, respondents learned that the petitioners continued to negotiate with Woodridge, and this led to the execution of two joint venture agreements between the petitioners and Woodridge, covering the Krause Park. The two joint venture agreements were notarized on March 7,, 2000 and October 16, 2000.
For the Teresa Park, four joint venture agreements were executed between the petitioners and Woodridge, and these were notarized on December 6, 2000, March 12, 2001, September 25, 2001, and October 1, 2002. Aside from the joint venture agreements, several deeds of sale were also executed between the petitioners and Woodridge, and these are dated September 24, 2001 and August 25, 2003.
Per respondent’s estimate, petitioners earned Php 26,068,000.00 and Php 22,497,000.00 for the sale of the Krause Park and Teresa Park projects, respectively. Respondents demanded payment of their commission from the petitioners, contending that the joint venture agreements and the sales over the Krause and Teresa Park were products of their successful negotiation with Woodridge. Petitioners, however, refused to pay despite demand. Thus, respondents filed a complaint for sum of money, damages, attorney’s fees, and litigation expenses before the Regional Trial Court of Parañaque City.
In their Answer, petitioners denied that they have an obligation to pay the respondents. Petitioners contend that the respondents offered their services as exclusive real estate brokers, but they were never engaged. Petitioners further state that they were not looking for an exclusive agency and they entertained brokers on a “first come, first served” basis. Petitioners, likewise, contend that they were not agreeable with the respondent’s proposal to sell the lots below the prevailing market value with no escalation clause, and that the sale of the Krause Park and the Teresa Park was made through the joint efforts of their Consultants, Engr. Julius Aragon and Florence Cabansang. No sales transaction was realized on account of the respondents.
RULING:
In Medrano v. Court of Appeals, it was held that “when there is a close, proximate, and causal connection between the broker’s efforts and the principal’s sale of his property—or joint venture agreement, in this case—the broker is entitled to a commission.”
Here, as aptly ruled by the CA, the proximity in time between the meetings held by the respondents and Woodridge and the subsequent execution of the joint venture agreements leads to a logical conclusion that it was the respondents who brokered it. Likewise, it is inconsequential that the authority of the respondents as brokers had already expired when the joint venture agreements over the subject properties were executed. The negotiation for these transactions began during the effectivity of the authority of the respondents, and these were carried out through their efforts. Thus, the respondents are entitled to a commission.
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