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G.R. No.

L-7144 May 31, 1955


FAR EASTERN EXPORT & IMPORT CO., petitioner, vs. LIM TECK SUAN, respondent.

Facts
Sometime in November, 1948, Ignacio Delizalde, an agent of the Far Eastern Export & Import Company, went to the store of Lim
Teck Suan and offered to sell textile, showing samples thereof, and having arrived at an agreement with Bernardo Lim, the General Manager of
Lim Teck Suan, Delizalde returned on November 17 with the Buyer's order. In accordance with said order, respondent established a letter of
credit No. 6390 in favor of Frenkel International Corporation through the Hongkong and Shanghai Bangking Corporation. On February 11,
1949, the textile arrived at Manila on board the vessel M. S. Arnold Maersk. The respondent complained to the petitioner of the inferior quality
of the textile received by him. Upon instructions of the petitioner, the goods were deposited to the United Warehouse Corporation. Then as per
suggestion of the Petitioner, respondent withdrew the textiles from the Warehouse for the purpose of offering them for sale which netted
P11,907.30. Deducting this amount from the sum of P23,686.96 which included the amount paid by respondent for said textile and the
warehouse expenses, a difference of P11,476.66 is left, representing the net direct loss.

Herein respondent filed an action for collection of sum of money amounting to P11, 4476.60, with legal interest from the date of the
filing of the complaint and to pay the costs. The Court of First Instance of Manila court acquitted the petitioner. On appeal the Court of Appeals
reversed the judgment entered by the lower court, basing its decision of reversal on the case of Jose Velasco, vs. Universal Trading Co., where
the transaction therein involved was found by the court to be one of purchase and sale and not of brokerage or agency. Hence this present
petition for certiorari to review a decision of the CA.

Issue: WON the transaction involved in the case is a contract of purchase and sale or of a brokerage or agency.

Ruling: The transaction is a contract of purchase and sale

We notice the following similarities between the Velasco case and the present case, however, in the latter case although Suan
received the merchandise he immediately protested its poor quality and it was deposited in the warehouse and later withdrawn and sold for the
best price possible, all at the suggestion of the Export company. The present case is in our opinion a stronger one than that of Velasco for
holding the transaction as one of purchase and sale because the Buyers Order, the same speaks of the items (merchandise) therein involved
as sold, and the sale was even confirmed by the Export company. In both cases, the agents Universal Trading Co. and the export company
dealt directly with the local merchants Velasco and Suan without expressly indicating or revealing their principals.

In both cases there was no privity of contract between the buyers Suan and Velasco and the suppliers Frenkel International
Corporation and A. J. Wilson Company, respectively. In both cases no commission or monetary consideration was paid or agreed to be paid by
the buyers to the Export company and the Universal Trading Co., proof that there was no agency or brokerage, and that the profit of the latter
was undoubtedly the difference between the price listed to the buyers and the net or special price quoted to the sellers, by the suppliers. As
already stated, it was held in the Velasco case that the transaction therein entered into was one of purchase and sale, and for the same
reasons given there, we agreed with the Court of Appeals that the transaction entered into here is one of purchase and sale.

As was held by this Tribunal in the case of Gonzalo Puyat & Sons Incorporated vs. Arco Amusement, 72 Phil., 402, where a foreign
company has an agent here selling its goods and merchandise, that same agent could not very well act as agent for local buyers, because the
interests of his foreign principal and those of the buyer would be in direct conflict. He could not serve two masters at the same time. In the
present case, the Export company being an agent of the Frenkel International Corporation could not, as it claims, have acted as an agent or
broker for Suan. Finding no reversible error in the decision appealed from, the same is hereby affirmed, with costs.

G.R. No. L-21601 December 17, 1966


NIELSON & COMPANY, INC., plaintiff-appellant, vs. LEPANTO CONSOLIDATED MINING COMPANY, defendant-appellee.
G.R. No. L-21601 dtd. December 28, 1968 Motion for Reconsideration Case

Facts
The Management contract in question was made by the parties on January 30, 1937 for a period of five (5) years. In the latter part of
1941, the parties agreed to renew the contract for another period of five (5) years, but in the meantime, the Pacific War broke out in December,
1941. In January, 1942 operation of the mining properties was disrupted on account of the war. The Japanese forces thereafter occupied the
mining properties, operated the mines during the continuance of the war, and who were ousted from the mining properties only in August of
1945. After the mining properties were liberated from the Japanese forces, LEPANTO took possession thereof and embarked in rebuilding and
reconstructing the mines and mill. On June 26, 1948 the mines resumed operation under the exclusive management of LEPANTO. Shortly
after, a disagreement arose between NIELSON and LEPANTO over the status of the operating contract in question which as renewed expired
in 1947. Under the terms thereof, the management contract shall remain in suspense in case fortuitous event or force majeure, such as war or
civil commotion, adversely affects the work of mining and milling.

On February 6, 1958, plaintiff brought this action against defendant before the Court of First Instance of Manila to recover certain
sums of money representing damages allegedly suffered by the former in view of the refusal of the latter to comply with the terms of a
management contract entered into between them on January 30, 1937, including attorney's fees and costs. Defendant in its answer denied the
material allegations of the complaint and set up certain special defenses, among them, prescription and laches, as bars against the institution
of the present action. After trial, during which the parties presented testimonial and numerous documentary evidence, the court a quo rendered

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a decision dismissing the complaint with costs. Nielson appealed and the SC hereby reverse the decision of the court a quo and entered in lieu
thereof another, ordering the appellee Lepanto to pay appellant Nielson.

Now in another case, following the above mentioned order, Lepanto filed a Motion for consideration asserting for the first time that
the management contract in question is a contract of agency such that, it has the right to revoke and terminate the said contract, as it did
terminate the same, under the law of agency, and particularly pursuant to Article 1733 of the Old Civil Code (Article 1920 of the New Civil
Code).

Issue: Whether the management contract is a contract of agency or a contract of lease of services.

Ruling: The Management Contract is a Contract of Lease of services

Article 1709 of the Old Civil Code, defining contract of agency, provides that "By the contract of agency, one person binds himself to
render some service or do something for the account or at the request of another." On the other hand, Article 1544, defining contract of lease of
service, provides that "In a lease of work or services, one of the parties binds himself to make or construct something or to render a service to
the other for a price certain." In both agency and lease of services one of the parties binds himself to render some service to the other party.
Agency, however, is distinguished from lease of work or services in that the basis of agency is representation, while in the lease of work or
services the basis is employment. The lessor of services does not represent his employer, while the agent represents his principal. Further,
agency is a preparatory contract, as agency "does not stop with the agency because the purpose is to enter into other contracts." The most
characteristic feature of an agency relationship is the agent's power to bring about business relations between his principal and third persons.
"The agent is destined to execute juridical acts (creation, modification or extinction of relations with third parties). Lease of services
contemplates only material (non-juridical) acts."

Herein, the principal and paramount undertaking of Nielson under the management contract was the operation and development of
the mine and the operation of the mill. All the other undertakings mentioned in the contract are necessary or incidental to the principal
undertaking these other undertakings being dependent upon the work on the development of the mine and the operation of the mill. In the
performance of this principal undertaking Nielson was not in any way executing juridical acts for Lepanto, destined to create, modify or
extinguish business relations between Lepanto and third persons. In other words, in performing its principal undertaking Nielson was not acting
as an agent of Lepanto, in the sense that the term agent is interpreted under the law of agency, but as one who was performing material acts
for an employer, for compensation.

It is true that the management contract provides that Nielson would also act as purchasing agent of supplies and enter into contracts
regarding the sale of mineral, but the contract also provides that Nielson could not make any purchase, or sell the minerals, without the prior
approval of Lepanto. It is clear, therefore, that even in these cases Nielson could not execute juridical acts which would bind Lepanto without
first securing the approval of Lepanto. Nielson, then, was to act only as an intermediary, not as an agent. Further, from the statements in the
annual report for 1936, and from the provision of paragraph XI of the Management contract, that the employment by Lepanto of Nielson to
operate and manage its mines was principally in consideration of the know-how and technical services that Nielson offered Lepanto. The
contract thus entered into pursuant to the offer made by Nielson and accepted by Lepanto was a "detailed operating contract". It was not a
contract of agency. Nowhere in the record is it shown that Lepanto considered Nielson as its agent and that Lepanto terminated the
management contract because it had lost its trust and confidence in Nielson. It is Our considered view that by express stipulation of the parties,
the management contract in question is not revocable at the will of Lepanto. We rule that this management contract is not a contract of agency
as defined in Article 1709 of the old Civil Code, but a contract of lease of services as defined in Article 1544 of the same Code. This
contract cannot be unilaterally revoked by Lepanto.

G.R. No. L-8169 January 29, 1957


THE SHELL COMPANY OF THE PHILIPPINES, LTD., petitioner, vs. FIREMEN'S INSURANCE COMPANY OF NEWARK, NEW JERSEY
COMMERCIAL CASUALTY INSURANCE CO., SALVADOR SISON, PORFIRIO DE LA FUENTE and THE COURT OF APPEALS (First
Division),respondents.

Facts
It is a fact that a Plymounth car owned by Salvador R. Sison was brought, on September 3, 1947 to the Shell Gasoline and Service
Station, operated by Porfirio De la Fuente, for washing, greasing and spraying. The operator of the station, having agreed to do service upon
payment of P8.00, the car was placed on a hydraulic lifter under the direction of the personnel of the station, when before the service be could
be accomplished, there was an escape of the air from the hydraulic lifter which caused the car to sway and just for a few seconds, the car fell.

The case was immediately reported to the Manila Adjustor Company, the adjustor of the firemen's Insurance Company and the
Commercial Casualty Insurance Company, as the car was insured with these insurance companies. The damaged car was taken to the shop of
the Philippine Motors, Incorporated, for repair upon order of the Firemen's Insurance Company and the Commercial Casualty Company, with
the consent of Salvador R. Sison. The car was restored to running condition after repairs amounting to P1,651.38, and was delivered to
Salvador R. Sison, who, in turn made assignments of his rights to recover damages in favor of the Firemen's Insurance Company and the
Commercial Casualty Insurance Company.

The insurance companies after paying the sum of P1,651.38 for the damage and charging the balance of P100.00 to Salvador Sison
in accordance with the terms of the insurance contract, have filed this action together with said Salvador Sison for the recovery of the total
amount of the damage from the defendants on the ground of negligence. The defendant Porfirio de la Fuente denied negligence in the
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operation of the lifter in his separate answer and contended further that the accidental fall of the car was caused by unforseen event. After trial
the Court dismissed the complaint. The plaintiffs appealed. The Court of Appeals reversed the judgment and sentenced the defendant to pay
the amount sought to be recovered, legal interest and costs, as stated at the beginning of this opinion. Hence this present Appeal by
certiorari under Rule 46.

Issue: WON Shell Co. of the Phil. is liable because Porfirio Dela Fuente is their Agent.

Ruling: YES

Taking into consideration the fact that the operator owed his position to the company and the latter could remove him or terminate
his services at will; that the service station belonged to the company and bore its trade name and the operator sold only the products of the
company; that the equipment used by the operator belonged to the company and were just loaned to the operator and the company took
charge of their repair and maintenance; that an employee of the company supervised the operator and conducted periodic inspection of the
company's gasoline and service station; that the price of the products sold by the operator was fixed by the company and not by the operator;
and that the receipt signed by the operator indicated that he was a mere agent, the finding of the Court of Appeals that the operator was an
agent of the company and not an independent contractor should not be disturbed. As the act of the agent or his employees acting within the
scope of his authority is the act of the principal, the breach of the undertaking by the agent is one for which the principal is answerable.

G.R. No. L-41182-3 April 16, 1988


DR. CARLOS L. SEVILLA and LINA O. SEVILLA, petitioners-appellants, vs. THE COURT OF APPEALS, TOURIST WORLD SERVICE,
INC., ELISEO S.CANILAO, and SEGUNDINA NOGUERA, respondents-appellees.

Facts
On Oct. 19, 1960, an contract was entered between Mrs. Segundina Noguera, party of the first part; the Tourist World Service, Inc.,
represented by Mr. Eliseo Canilao as party of the second part, and hereinafter referred to as appellants, the Tourist World Service, Inc. leased
the premises belonging to the party of the first part at Mabini St., Manila for the former use as a branch office. In the said contract the party of
the third part held herself solidarily liable with the party of the part for the prompt payment of the monthly rental agreed on.

On or about November 24, 1961 the Tourist World Service branch in Mabini St. appears to be losing, it decided on closing down its
office. It further appears that on Jan. 3, 1962, the contract with the appellees for the use of the Branch Office premises was terminated and
while the effectivity thereof was Jan. 31, 1962, the appellees no longer use it. As a matter of fact appellants have not been using it since Nov.
1961. Because of this, and to comply with the mandate of the Tourist World Service, the corporate secretary Gabino Canilao went over to the
branch office, and, finding the premises locked, and, being unable to contact Lina Sevilla, he padlocked the premises on June 4, 1962 to
protect the interests of the Tourist World Service.

When neither the appellant Lina Sevilla nor any of her employees could enter the locked premises, a complaint wall filed by the
herein appellants against the appellees with a prayer for the issuance of mandatory preliminary injunction. Both appellees answered with
counterclaims. For apparent lack of interest of the parties therein, the trial court ordered the dismissal of the case without prejudice. The
appellee Segundina Noguera sought reconsideration of the order dismissing her counterclaim which the court a quo, in an order dated June 8,
1963, granted permitting her to present evidence in support of her counterclaim. On June 17,1963, appellant Lina Sevilla refiled her case
against the herein appellees and after the issues were joined, the reinstated counterclaim of Segundina Noguera and the new complaint of
appellant Lina Sevilla were jointly heard following which the court a quo ordered both cases dismissed for lack of merit, on the basis of which
was elevated the instant appeal.

The trial court held for the private respondent on the premise that the private respondent, Tourist World Service, Inc., being the true
lessee, it was within its prerogative to terminate the lease and padlock the premises. It likewise found the petitioner, Lina Sevilla, to be a mere
employee of said Tourist World Service, Inc. and as such, she was bound by the acts of her employer. The respondent Court of
Appeal rendered an affirmance. Hence the present petition.

Issue: WON Sevilla is an employee of Tourist World Service, Inc.

Ruling: NO

The records will show that the petitioner, Lina Sevilla, was not subject to control by the private respondent Tourist World Service,
Inc., either as to the result of the enterprise or as to the means used in connection therewith. In the first place, under the contract of lease
covering the Tourist Worlds Ermita office, she had bound herself in solidum as and for rental payments, an arrangement that would be like
claims of a master-servant relationship. True the respondent Court would later minimize her participation in the lease as one of mere
guaranty, that does not make her an employee of Tourist World, since in any case, a true employee cannot be made to part with his own
money in pursuance of his employer's business, or otherwise, assume any liability thereof. In that event, the parties must be bound by some
other relation, but certainly not employment.

It is the Court's considered opinion, that when the petitioner, Lina Sevilla, agreed to (wo)man the private respondent, Tourist World
Service, Inc.'s Ermita office, she must have done so pursuant to a contract of agency. It is the essence of this contract that the agent renders
services "in representation or on behalf of another. In the case at bar, Sevilla solicited airline fares, but she did so for and on behalf of her
principal, Tourist World Service, Inc. As compensation, she received 4% of the proceeds in the concept of commissions. And as we said,
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Sevilla herself based on her letter of November 28, 1961, pre-assumed her principal's authority as owner of the business undertaking. We are
convinced, considering the circumstances and from the respondent Court's recital of facts, that the ties had contemplated a principal agent
relationship, rather than a joint managament or a partnership..

But unlike simple grants of a power of attorney, the agency that we hereby declare to be compatible with the intent of the parties,
cannot be revoked at will. The reason is that it is one coupled with an interest, the agency having been created for mutual interest, of the agent
and the principal. It appears that Lina Sevilla is a bona fide travel agent herself, and as such, she had acquired an interest in the business
entrusted to her. Moreover, she had assumed a personal obligation for the operation thereof, holding herself solidarily liable for the payment of
rentals. She continued the business, using her own name, after Tourist World had stopped further operations. Her interest, obviously, is not to
the commissions she earned as a result of her business transactions, but one that extends to the very subject matter of the power of
management delegated to her. It is an agency that, as we said, cannot be revoked at the pleasure of the principal. Accordingly, the revocation
complained of should entitle the petitioner, Lina Sevilla, to damages. As we have stated, the respondent Court avoided this issue, confining
itself to the telephone disconnection and padlocking WHEREFORE, the Decision promulgated on January 23, 1975 as well as the Resolution
issued on July 31, 1975, by the respondent Court of Appeals is hereby REVERSED and SET ASIDE.

G.R. No. L-34338 November 21, 1984


LOURDES VALERIO LIM, petitioner, vs. PEOPLE OF THE PHILIPPINES, respondent.

Facts
The appellant is a businesswoman. On January 10, 1966, the appellant went to the house of Maria Ayroso and proposed to sell
Ayroso's tobacco. Ayroso agreed to the proposition of the appellant to sell her tobacco consisting of 615 kilos at P1.30 a kilo. The appellant
was to receive the overprice for which she could sell the tobacco. This agreement was made in the presence of plaintiff's sister, Salud G.
Bantug. Of the total value of P799.50, the appellant had paid to Ayroso only P240.00, and this was paid on three different times. Demands for
the payment of the balance of the value of the tobacco were made Ayroso but to no avail. Interestingly, the appellant denied that demands for
payment were made upon her, although it is a fact that on October 19, 1966, she wrote a letter to Salud Bantug, explaining her nonpayment.

Pursuant to this letter, the appellant sent a money order for P100.00 on October 24, 1967, and another for P50.00 on March 8,
1967; and she paid P90.00 on April 18, 1967, dated April 18, 1967, or a total of P240.00. As no further amount was paid, the complainant filed
a complaint against the appellant for estafa. After trial, Petitioner Lourdes Valerio Lim was found guilty of the crime of estafa. From this
judgment, appeal was taken to the then Court of Appeals which affirmed the decision of the lower court but modified the penalty. Hence this
present petition for review by certiorari.

Issue: Whether or not the honorable Court of Appeals was legally right in holding that the foregoing receipt is a contract of agency and not a
contract of sale

Ruling: CA is correct; it is a Contract of Agency

Aside from the fact that Maria Ayroso testified that the appellant asked her to be her agent in selling Ayroso's tobacco, the appellant
herself admitted that there was an agreement that upon the sale of the tobacco she would be given something. The appellant is a
businesswoman, and it is unbelievable that she would go to the extent of going to Ayroso's house and take the tobacco with a jeep which she
had brought if she did not intend to make a profit out of the transaction. Certainly, if she was doing a favor to Maria Ayroso and it was Ayroso
who had requested her to sell her tobacco, it would not have been the appellant who would have gone to the house of Ayroso, but it would
have been Ayroso who would have gone to the house of the appellant and deliver the tobacco to the appellant. The fact that appellant received
the tobacco to be sold at P1.30 per kilo and the proceeds to be given to complainant as soon as it was sold, strongly negates transfer of
ownership of the goods to the petitioner. The agreement constituted her as an agent with the obligation to return the tobacco if the same was
not sold. ACCORDINGLY, the petition for review on certiorari is dismissed for lack of merit. With costs.

EN BANC
G.R. No. L-19265 May 29, 1964
MOISES SAN DIEGO, SR., petitioner, vs. ADELO NOMBRE and PEDRO ESCANLAR, respondents.

Facts
The case at bar had its origin in Special Proceedings No. 7279 of the CFI of Negros Occidental wherein respondent Adelo Nombre
was the duly constituted judicial administrator. On May 1, 1960, Nombre, in his capacity was judicial administrator of the intestate estate
subject of the Sp. Proc. stated above, leased one of the properties of the estate (a fishpond identified as Lot No. 1617 of the cadastral survey of
Kabankaban, Negros Occidental), to Pedro Escanlar, the other respondent. The terms of the lease was for three (3) years, with a yearly rental
of P3,000.00 to expire on May 1, 1963, the transaction having been done, admittedly, without previous authority or approval of the Court where
the proceedings was pending. On January 17, 1961, Nombre was removed as administrator by Order of the court and one Sofronio
Campillanos was appointed in his stead.

The appeal on the Order of Nombre's removal is supposedly pending with the Court of Appeals. Respondent Escanlar was cited for
contempt, allegedly for his refusal to surrender the fishpond to the newly appointed administrator. On March 20, 1961, Campillanos filed a

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motion asking for authority to execute a lease contract of the same fishpond, in favor of petitioner herein, Moises San Diego, Sr., for 5 years
from 1961, at a yearly rental of P5,000.00. Escanlar was not notified of such motion. Nombre, the deposed administrator, presented a written
opposition to the motion of Campillanos on April 11, 1964, pointing out that the fishpond had been leased by him to Escanlar for 3 years, the
period of which was going to expire on May 1, 1963. Notwithstanding the opposition, the Court declared that the contract in favor of Escanlar
was null and void, for want of judicial authority. Nombre moved to reconsider the order but it was denied. The trial judge stating that the
contract in favor of Escanlar was executed in bad faith and was fraudulent because of the imminence of Nombre's removal as administrator,
one of the causes of which was his indiscriminate pleasant, of the property with inadequate rentals.

A Petition for Certiorari was filed by the Nombre and Escanlar, asking for the annulment of the Orders of the Court of Appeals. A
Writ of preliminary injunction was likewise prayed for to restrain the new administrator Campillanos from possessing the fishpond and from
executing a new lease contract covering it. The CA issued the injunctive writ and required respondents therein to Answer. Thereafter, the CA
dismissed the petition for certiorari as it has been held that even in the absence of such special powers, a contract or lease for more than 6
years is not entirely invalid; it is invalid only in so far as it exceeds the six-year limit. On September 13, 1961, petitioner herein Moises San
Diego, Sr., who was not a party in the case, intervened and moved for a reconsideration of the above judgment. The petition was denied. With
the denial of the said motions, only San Diego, appealed therefrom.

Issue: WON a judicial administrator can validly lease property of the estate without prior judicial authority and approval.

Ruling: NO

The lease contract in favor of Escanlar being for 3 years and without such court approval and authority is, therefore, null and void.
While it may be admitted that the duties of a judicial administrator and an agent (petitioner alleges that both act in representative capacity), are
in some respects, identical, the provisions on agency (Art. 1878, C.C.), should not apply to a judicial administrator. A judicial administrator is
appointed by the Court. He is not only the representative of said Court, but also the heirs and creditors of the estate (Chua Tan v. Del Rosario,
57 Phil. 411). A judicial administrator before entering into his duties, is required to file a bond. These circumstances are not true in case of
agency. The agent is only answerable to his principal. The protection which the law gives the principal, in limiting the powers and rights of an
agent, stems from the fact that control by the principal can only be thru agreements, whereas the acts of a judicial administrator are subject to
specific provisions of law and orders of the appointing court. WHEREFORE, the decision appealed from should be, as it is hereby affirmed, in
all respects, with costs against petitioner Moises San Diego, Sr.

EN BANC G.R. No. L-5486 August 17, 1910


JOSE DE LA PENA Y DE RAMON, plaintiff-appellant, vs. FEDERICO HIDALGO, defendant-appellant.

Facts
Before De la Pena went to Spain, he executed a power of attorney in favor of Federico and for 3 other people. Their task is to
represent him and administer various properties he owned in Manila. Federico took charge in Nov. 1887. After a few years, Federico wrote a
letter to De la Pena. It contains a request that De la Pena assign a person who might substitute Federico in the event that he leaves the
Philippines because one of the agents died and the other 2 are unwilling to take charge. De la Pena did not answer the letter there was
neither approval nor objection on the accounts and no appointment of another person who might substitute Federico. Because of health
reasons, Federico went to Spain. Before he departed, he sent another letter to De la Pena a summary of accounts and informing that he will be
leaving the Philippines and that he turned over the administration to Antonio (though Federico stated that if De la Pena is not happy with this,
De la Pena must send Antonio a new power of attorney). De la Pena files in court for the collection of revenue from his accounts which was
handled by Federico. De la Pena alleges that Federico has only remitted P1, 200.00 and still owes him roughly P72,000.00. Furthermore, De la
Pena seeks to hold Federico liable for the administration from the period of 1887 until 1904. Federico asserts that he cannot be liable for the
period after he renounced his agency. Furthermore Federico argues that his renunciation and appointment of a substitute was legal for there
was no objection on the part of De la Pena.

Issue: WON there was a valid agency in the case of Antonio.

Ruling: YES

There was an implied agency in the case of Antonio. De la Pena created an implied agency in favor of Antonio because of his
silence on the matter for a number of years. There was a valid renunciation in the case of Federico. His reason for leaving the country is
legitimate. Furthermore, he gave notice to De la Pena about his situation in which the latter failed to give his objection. Being a valid agency on
the part of Antonio and a valid renunciation on the party of Federico, it must follow that the liability of Federico only extends up to the point
before his renunciation of the agency. The implied agency is founded on the lack of contradiction or opposition, which constitutes simultaneous
agreement on the part of the presumed principal to the execution of the contract. The agent and administrator who was obliged to leave his
charge for a legitimate cause and who duly informed his principal, is thenceforward released and freed from the results and consequences of
the management of the person who substituted him with the consent, even tacit though it be, of his principal.

Furthermore, it was also argued by De la Pena that there was no authority on the part of Federico to appoint a substitute. The
COURT ruled that the power of attorney given by De la Pena to Federico did not include a power to appoint a substitute. Nevertheless, it was
pointed out that the appointment made by Federico was not based on the power of attorney of De la Pena. The appointment was grounded on
a new power of attorney Federico himself executed in favor of Antonio. Thus, there was no violation incurred by Federico. And as stated in the
case, De la Pena was duly informed of this but nevertheless kept his silence on the matter.
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FIRST DIVISION G.R. No. L-40242 December 15, 1982
DOMINGA CONDE, petitioner, vs. THE HONORABLE COURT OF APPEALS, MANILA PACIENTE CORDERO, together with his wife,
NICETAS ALTERA, RAMON CONDE, together with his wife, CATALINA T. CONDE, respondents.

Facts
On 7 April 1938. Margarita Conde, Bernardo Conde and the petitioner Dominga Conde, as heirs of Santiago Conde, sold with right
of repurchase, within ten (10) years from said date, a parcel of agricultural land located in Maghubas Burauen Leyte, (Lot 840), with an
approximate area of one (1) hectare, to Casimira Pasagui, married to Pio Altera for P165.00. On 28 November 1945, private respondent
Paciente Cordero, son-in-law of the Alteras, signed a document in the Visayan dialect, the English translation of which reads: MEMORANDUM
OF REPURCHASE OVER A PARCEL OF LAND SOLD WITH REPURCHASE WHICH DOCUMENT GOT LOST

To be noted is the fact that neither of the vendees-a-retro, Pio Altera nor Casimira Pasagui, was a signatory to the deed. Petitioner
maintains that because Pio Altera was very ill at the time, Paciente Cordero executed the deed of resale for and on behalf of his father-in-law.
Petitioner further states that she redeemed the property with her own money as her co-heirs were bereft of funds for the purpose. The pacto de
retro document was eventually found. On 30 June 1965 Pio Altera sold the disputed lot to the spouses Ramon Conde and Catalina T. Conde,
who are also private respondents herein. Their relationship to petitioner does not appear from the records. Nor has the document of sale been
exhibited. Contending that she had validly repurchased the lot in question in 1945, petitioner filed in the CFI of Leyte, Branch IX, Tacloban
City, a Complaint against Paciente Cordero and his wife Nicetas Altera, Ramon Conde and his wife Catalina T. Conde, and Casimira Pasagui
Pio Altera having died in 1966), for quieting of title to real property and declaration of ownership.

After trial, the lower Court rendered its Decision dismissing the Complaint and the counterclaim and ordering petitioner "to vacate
the property in dispute and deliver its peaceful possession to the defendants Ramon Conde and Catalina T. Conde". On appeal, the Court of
Appeals upheld the findings of the Court a quo that petitioner had failed to validly exercise her right of repurchase in view of the fact that the
Memorandum of Repurchase was signed by Paciente Cordero and not by Pio Altera, the vendee-a-retro, and that there is nothing in said
document to show that Cordero was specifically authorized to act for and on behalf of the vendee a retro, Pio Altera. Reconsideration having
been denied by the Appellate Court, the case is before us on review.

Issue: WON there was an implied agency when Cordero signed the Memorandum of Repurchase.

Ruling: YES

There is no question that neither of the vendees-a-retro signed the "Memorandum of Repurchase", and that there was no formal
authorization from the vendees for Paciente Cordero to act for and on their behalf. However, the fact that from the execution of the repurchase
document in 1945, possession, which heretofore had been with the Alteras, has been in the hands of petitioner as stipulated therein. Land
taxes have also been paid for by petitioner yearly from 1947 to 1969 inclusively. If, as opined by both the Court a quo and the Appellate Court,
petitioner had done nothing to formalize her repurchase, by the same token, neither have the vendees-a-retro done anything to clear their title
of the encumbrance therein regarding petitioner's right to repurchase. No new agreement was entered into by the parties as stipulated in the
deed of pacto de retro, if the vendors a retro failed to exercise their right of redemption after ten years. If, as alleged, petitioner exerted no effort
to procure the signature of Pio Altera after he had recovered from his illness, neither did the Alteras repudiate the deed that their son-in-law had
signed. Thus, an implied agency must be held to have been created from their silence or lack of action, or their failure to repudiate the agency.

In sum, although the contending parties were legally wanting in their respective actuations, the repurchase by petitioner is supported
by the admissions at the pre-trial that petitioner has been in possession since the year 1945, the date of the deed of repurchase, and has been
paying land taxes thereon since then. The imperatives of substantial justice, and the equitable principle of laches brought about by private
respondents' inaction and neglect for 24 years, loom in petitioner's favor. WHEREFORE, the judgment of respondent Court of Appeals is
hereby REVERSED and SET ASIDE, and petitioner is hereby declared the owner of the disputed property.

EN BANC G.R. No. L-19001 November 11, 1922


HARRY E. KEELER ELECTRIC CO., INC., plaintiff-appellant, vs. DOMINGO RODRIGUEZ, defendant-appellee.

Facts
The plaintiff is a domestic corporation with its principal office in the city of Manila and engaged in the electrical business, and among
other things in the sale of what is known as the "Matthews" electric plant, and the defendant is a resident of Talisay, Occidental Negros, and A.
C. Montelibano was a resident of Iloilo. Having this information, Montelibano approached plaintiff at its Manila office, claiming that he could find
a purchaser for the "Matthews" plant. Montelibano was told by the plaintiff that for any plant that he could sell or any customer that he could find
he would be paid a commission of 10% for his services, if the sale was consummated. Among other persons. Montelibano interviews the
defendant, and, through his efforts, one of the "Matthews" plants was sold by the plaintiff to the defendant, and was shipped from Manila to
Iloilo. Thereafter the same was installed on defendant's premises after but without the knowledge of the plaintiff, the defendant paid the
purchase price to Montelibano. As a result, plaintiff commenced this action against the defendant, alleging that about August 18, 1920, it sold
and delivered to the defendant the electric plant at the agreed price of P2,513.55 no part of which has been paid, the demands judgment for the

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amount with interest from October 20, 1920. For answer, the defendant admits the corporation of the plaintiff, and denies all other material
allegations of the complaint. Upon such issues the testimony was taken, and the lower court rendered judgment for the defendant, from which
the plaintiff appealed.

Issue: WON Montelibano is authorized to receive money for or in behalf of Keeler Electric.

Ruling: NO

Article 1727 provides: The principal shall be liable as to matters with respect to which the agent has exceeded his authority only
when he ratifies the same expressly or by implication. It appears from the testimony of H. E. Keeler that he was president of the plaintiff and
that the plant in question was shipped from Manila to Iloilo and consigned to the plaintiff itself, and that at the time of the shipment the plaintiff
sent Juan Cenar, one of its employees, with the shipment, for the purpose of installing the plant on defendant's premises. That plaintiff gave
Cenar a statement of the account, including some extras and the expenses of the mechanic, making a total of P2,563,95. That Montelibano
had no authority from the plaintiff to receive or receipt for money. That in truth and in fact his services were limited and confined to the finding of
purchasers for the "Matthews" plant to whom the plaintiff would later make and consummate the sale. That Montelibano was not an electrician,
could not install the plant and did not know anything about its mechanism. WHEREFOR, the judgment of the lower court is reversed, and one
will be entered here in favor of the plaintiff and against the defendant for the sum of P2,513.55 with interest at the legal rate from January 10,
1921, with costs in favor of the appellant.

EN BANC G.R. No. 6906 September 27, 1911


FLORENTINO RALLOS, ET AL., plaintiff-appellee, vs. TEODORO R. YANGCO, defendant-appellant.

Facts
The defendant in this case (Yangco), on the 27th day of November 1907, sent to the plaintiff (Rallos), stating that he (Yangco) has a
steamship office at No. 163 Muelle de la Reina, Binondo, Manila, P. I., which is a shipping and commission department for buying and selling
leaf tobacco and other native products. Furthermore in the letter, it was mentioned that Mr. Florentino Collantes, was granted by Yangco a
power of attorney before the notary, Mr. Perfecto Salas Rodriguez, dated November 16, 1907, to perform in Yangcos name and on his behalf
all acts necessary for carrying the plans of Yangcos business. Mr. Collantes signed the power of attorney.

Accepting this invitation, Rallos proceeded to do a considerable business with the defendant through the said Collantes, as his
factor, sending to him as agent for the defendant a good deal of produce to be sold on commission. Later, and in the month of February, 1909,
the plaintiffs sent to the said Collantes, as agent for the defendant, 218 bundles of tobacco in the leaf to be sold on commission, as had been
other produce previously. The said Collantes received said tobacco and sold it for the sum of P1,744. The charges for such sale were P206.96,
leaving in the hands of said Collantes the sum of P1,537.08 belonging to the plaintiffs. This sum was, apparently, converted to his own use by
said agent.

The defendant refused to pay the said sum upon demand of the plaintiffs, placing such refusal upon the ground that at the time that
the said tobacco was received and sold by Collantes he was acting personally and not as agent of the defendant. Thus, Rallos filed an action to
recover said sum against Yangco. The CFI rendered a decision in favor of Rallos hence this present appeal of Yangco.

Issue: Whether or not the Rallos, having sent produce to sell on commission to the former agent of the Yangco, can recover from the latter..

Ruling: YES

We are of the opinion that the Yangco is liable. In the present case, it appears, that prior to the sending of said tobacco the
defendant had severed his relations with Collantes and that the latter was no longer acting as his factor. This fact was not known to the plaintiff
and it is conceded in the case that no notice of any kind was given by the defendant to the plaintiffs of the termination of the relations between
the defendant and his agent. Having advertised the fact that Collantes was his agent and having given them a special invitation to deal with
such agent, it was the duty of the defendant on the termination of the relationship of principal and agent to give due and timely notice thereof to
the plaintiffs. Failing to do so, he is responsible to them for whatever goods may have been in good faith and without negligence sent to the
agent without knowledge, actual or constructive, of the termination of such relationship. For these reasons the judgment appealed from is
confirmed, without special finding as to costs.

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