MANILA MEMORIAL PARK CEMETERY, INC. V. LINSANGAN Reasoning. Baluyot acted in excess of the authority granted to her by MMPCI.
t acted in excess of the authority granted to her by MMPCI. The original
G.R. No. 94050
TINGA, November 21. 1991
NATURE
Petition for Review under Rule 45 of the ROC
FACTS
-Florencia Baluyot, an Agency Manager of MMPCI, offered to Atty. Pedro Linsangan a lot at the Holy
Cross Memorial Park owned by MMPCI for P95,000. The lots former owner was not interested on the
lot anymore and so agreed to sell the lot after he has been reimbursed. Atty. Linsangan agreed to the
offer, gave Baluyot the reimbursement that would be given to the former owner and down payment
that would be paid to MMPCI, with Baluyot only handing him handwritten and typewritten receipts (not
O.R.).
-However, instead of the old contract with the old owner reformed so that Atty. Linsangan would
become the new owner of the lot, Baluyot offered a new contract covering the same lot. Atty.
Linsangan protested, but Baluyot assured him that that Atty. Linsangan would still be paying P95,000
instead of the P132,250 price under the new contract. Baluyot even executed a document confirming
the previous arrangement between her and Atty. Linsangan so that even if the purchase price under
the new contract has increased, Atty. Linsangan would still be paying the old purchase price. Atty.
Linsangan signed the new contract with MMPCI and tendered payment in checks in accordance with
the old agreement between him and Baluyot.
-It turns out that MMPCI was not aware of the arrangement between Baluyot and Atty. Linsangan, and
that Baluyot was only authorized under her Agency Management contract to solicit and remit to
MMPCI offers to purchase interment spaces belonging to and sold by MMPCI. So, even if Atty.
Linsangan had complied with the agreed payment, MMPCI cancelled the new contract for non-payment
of arrearages.
-Atty. Linsangan filed complaint for Breach of Contract and Damages against Baluyot and MMPCI.
LC: Baluyot was an agent of MMPCI; MMPCI was estopped from denying the agency after having
received and encashed the checks issued by Atty. Linsangan and given it by Baluyot.
CA: affirmed LC + Baluyots authority was conferred upon her by habit and custom
ISSUES
1. WON the SC could review the findings of fact of CA
2. WON Baluyot was an agent of MMPCI
3. WON MMPCI was bound by the contract procured by Atty. Linsangan and solicited by Baluyot
4. WON MMPCI was estopped from denying liability to Atty. Linsangan
HELD
1. YES
Ratio. There are instances when the findings of fact of the trial court and/or Court of Appeals may be
reviewed by the Supreme Court, such as (1) when the conclusion is a finding grounded entirely on
speculation, surmises and conjectures; (2) when the inference made is manifestly mistaken, absurd or
impossible; (3) where there is a grave abuse of discretion; (4) when the judgment is based on a
misapprehension of facts; (5) when the findings of fact are conflicting; (6) when the Court of Appeals,
in making its findings, went beyond the issues of the case and the same is contrary to the admissions
of both appellant and appellee; (7) when the findings are contrary to those of the trial court; (8)
when the findings of fact are conclusions without citation of specific evidence on which they are
based; (9) when the facts set forth in the petition as well as in the petitioners main and reply briefs
are not disputed by the respondents; and (10) the findings of fact of the Court of Appeals are
premised on the supposed absence of evidence and contradicted by the evidence on record.
2. YES
Ratio. 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. Thus, the elements
of agency are (i) consent, express or implied, of the parties to establish the relationship; (ii) the
object is the execution of a juridical act in relation to a third person; (iii) the agent acts as a
representative and not for himself; and (iv) the agent acts within the scope of his authority.
Reasoning. Baluyot was an agent of MMPCI, having represented the interest of the latter, and having
been allowed by MMPCI to represent it in her dealings with its clients/prospective buyers.
3. NO
Ratio. The acts of the agent beyond the scope of his authority do not bind the principal unless the
latter ratifies the same. It also bears emphasis that when the third person knows that the agent was
acting beyond his power or authority, the principal cannot be held liable for the acts of the agent. If
the said third person was aware of such limits of authority, he is to blame and is not entitled to
recover damages from the agent, unless the latter undertook to secure the principals ratification.
-on RATIFICATION: Ratification in agency is the adoption or confirmation by one person of an act
performed on his behalf by another without authority. The substance of the doctrine is confirmation
after conduct, amounting to a substitute for a prior authority. Ordinarily, the principal must have full
knowledge at the time of ratification of all the material facts and circumstances relating to the
unauthorized act of the person who assumed to act as agent. Thus, if material facts were suppressed
or unknown, there can be no valid ratification and this regardless of the purpose or lack thereof in
concealing such facts and regardless of the parties between whom the question of ratification may
arise. Nevertheless, this principle does not apply if the principals ignorance of the material facts and
circumstances was willful, or that the principal chooses to act in ignorance of the facts. However, in
the absence of circumstances putting a reasonably prudent man on inquiry, ratification cannot be
implied as against the principal who is ignorant of the facts.
exceeds the limits of his authority without giving such party sufficient notice
agreement between her and Atty. Linsangan was unknown to MMPCI and thus, MMPCI was not bound
by their agreement. As far as they were concerned, the contract price was P132,250 and not P95, 000.
As for the ratification, see estoppel.
4. NO.
Ratio. The essential elements of estoppel are (i) conduct of a party amounting to false
representation or concealment of material facts or at least calculated to convey the impression that the
facts are otherwise than, and inconsistent with, those which the party subsequently attempts to
assert; (ii) intent, or at least expectation, that this conduct shall be acted upon by, or at least
influence, the other party; and (iii) knowledge, actual or constructive, of the real facts.
-One who claims the benefit of an estoppel on the ground that he has been misled by the
representations of another must not have been misled through his own want of reasonable care and
circumspection.
-Estoppel must be intentional and unequivocal, for when misapplied, it can easily become a most
convenient and effective means of injustice.
Reasoning. There is no indication that MMPCI let the public nor Atty. Linsangan to believe that
Baluyot had the authority to alter the standard contracts of the company. Neither is there any showing
that prior to signing of the new contract, MMPCI had any knowledge of Baluyots commitment to Atty.
Linsangan.
-Even assuming that Atty. Linsangan was misled by MMPCIs actuations, he still cannot invoke the
principle of estoppel, as he was clearly negligent in his dealings with Baluyot, and could have easily
determined, had he only been cautious and prudent, whether said agent was clothed with the
authority to change the terms of the principals written contract.
Disposition. WHEREFORE, the instant petition is GRANTED. The Decision of the Court of Appeals
dated 22 June 2001 and its Resolution dated 12 December 2001 in CA- G.R. CV No. 49802, as well as
the Decision in Civil Case No. 88-1253 of the Regional Trial Court, Makati City Branch 57, are hereby
REVERSED and SET ASIDE. The Complaint in Civil Case No. 88-1253 is DISMISSED for lack of cause of
action. No pronouncement as to costs.
Soriamont Steamship Agencies Inc. & Ronas v Sprint Transport Services, & Papa
Sprint filed for a complaint for a sum of money against Soriamont and Ronas
Subject of dispute: ELA (EQUIPMENT LEASE AGREEMENT)
Sprint alleges:
It entered into a lease agreement for Equipment with Soriamont
Sprint agreed to lease chassis units for the transport of container vans
Thru authorization letters, Ronas (on behalf of Soriamont and PAPA TRUCKING
SERVICES [PTS]) were able to withdraw 2 chassis units from the container yard of
Sprint.
Soriamont and Ronas failed to pay rental fees.
Sprint was subsequently informed that the equipment was LOST
Despite demands, Soriamont and Ronas failed to pay rental fees and failed to replace
equipment.
Soriamont and Ronas alleges:
It was [PTS] who withdrew the equipment.
Soriamont and Ronas filed a Third Party Complaint against [PTS], who failed to answer
and thus was declared in default
RTC favored Sprint, held Soriamont liable
CA
- found that the contract contained an AUTOMATIC RENEWAL CLAUSE
- Found that Soriamont authorized the withdrawal of [PTS] of the equipment
- Affirmed RTC decision
ISSUE: Whether or not PTS is an agent of Soriamont?
Soriamont is essentially challenging court findings that PTS withdrew the equipment as
an agent of Soriamont.
In effect, Soriamont is raising questions of fact which is NOT ALLOWED
Rule 45 -> only questions of law may be raised in a petition for review
Evidence shows that the preponderance of evidence supports the existence of an agency
relationship between Soriamont and PTS.
The ELA explicitly authorized Soriamont to appoint a representative who shall withdraw
and return the leased chassis units (which is PTS)
Since the ELA was not shown to be terminated, its AUTOMATIC RENEWAL CLAUSE took
effect pursuant to their contract.
The settled rule is that persons dealing with an assumed agent are bound at their peril;
and if they would hold the principal liable, they must ascertain not only the fact of agency, but also the
nature and extent of authority, and in case either is controverted, the burden of proof is upon them to
prove it. Sprint has successfully discharged this burden.
Alternatively, if PTS is found to be its agent, Soriamont argues that PTS is liable for the
loss of the subject equipment, since PTS acted beyond its authority as agent. Soriamont cites Article
1897 of the Civil Code, which provides:
Art. 1897. The agent who acts as such is not personally liable
to the party with whom he contracts, unless he expressly binds himself or
of his powers.
The burden falls upon Soriamont to prove its affirmative allegation that PTS acted in any
manner in excess of its authority as agent, thus, resulting in the loss of the subject equipment. To
recall, the subject equipment was withdrawn and used by PTS with the authority of Soriamont. And for
PTS to be personally liable, as agent, it is vital that Soriamont be able to prove that PTS damaged or
lost the said equipment because it acted contrary to or in excess of the authority granted to it by
Soriamont. As the Court of Appeals and the RTC found, however, Soriamont did not adduce any
evidence at all to prove said allegation.
Eurotech Industrial Technologies, Inc. v. Edwin Cuizon and Erwin Cuizon
G.R. No. 167552 April 23, 2007
Chico-Nazario, J.
FACTS:
Eurotech is engaged in the business of importation and distribution of various European industrial
equipment. It has as one of its customers Impact Systems Sales which is a sole proprietorship
owned by Erwin Cuizon.
Eurotech sold to Impact Systems various products allegedly amounting to P91,338.00. Cuizons
sought to buy from Eurotech 1 unit of sludge pump valued at P250,000.00 with Cuizons making a
down payment of P50,000.00. When the sludge pump arrived from the United Kingdom, Eurotech
refused to deliver the same to Cuizons without their having fully settled their indebtedness to
Eurotech. Thus, Edwin Cuizon and Alberto de Jesus, general manager of Eurotech, executed a
Deed of Assignment of receivables in favor of Eurotech.
Cuizons, despite the existence of the Deed of Assignment, proceeded to collect from Toledo Power
Company the amount of P365,135.29. Eurotech made several demands upon Cuizons to pay their
obligations. As a result, Cuizons were able to make partial payments to Eurotech. Cuizons total
obligations stood at P295,000.00 excluding interests and attorneys fees.
Edwin Cuizon alleged that he is not a real party in interest in this case. According to him, he was
acting as mere agent of his principal, which was the Impact Systems, in his transaction with
Eurotech and the latter was very much aware of this fact.
ISSUE: WON Edwin exceeded his authority when he signed the Deed of Assignment thereby binding
himself personally to pay the obligations to Eurotech
HELD: No.
Edwin insists that he was a mere agent of Impact Systems which is owned by Erwin and that his
status as such is known even to Eurotech as it is alleged in the Complaint that he is being sued in
his capacity as the sales manager of the said business venture. Likewise, Edwin points to the Deed
of Assignment which clearly states that he was acting as a representative of Impact Systems in said
transaction.
Art. 1897. The agent who acts as such is not personally liable to the party with whom he contracts,
unless he expressly binds himself or exceeds the limits of his authority without giving such party
sufficient notice of his powers.
In a contract of agency, a person binds himself to render some service or to do something in
representation or on behalf of another with the latters consent. Its purpose is to extend the
personality of the principal or the party for whom another acts and from whom he or she derives
the authority to act. The basis of agency is representation, that is, the agent acts for and on behalf
of the principal on matters within the scope of his authority and said acts have the same legal
effect as if they were personally executed by the principal.
elements of the contract of agency: (1) consent, express or implied, of the parties to establish the
relationship; (2) the object is the execution of a juridical act in relation to a third person; (3) the
agent acts as a representative and not for himself; (4) the agent acts within the scope of his
authority
An agent, who acts as such, is not personally liable to the party with whom he contracts. There are
2 instances when an agent becomes personally liable to a third person. The first is when he
expressly binds himself to the obligation and the second is when he exceeds his authority. In the
last instance, the agent can be held liable if he does not give the third party sufficient notice of his
powers. Edwin does not fall within any of the exceptions contained in Art. 1897.
In the absence of an agreement to the contrary, a managing agent may enter into any contracts
that he deems reasonably necessary or requisite for the protection of the interests of his principal
entrusted to his management.
Edwin Cuizon acted well-within his authority when he signed the Deed of Assignment. Eurotech
refused to deliver the 1 unit of sludge pump unless it received, in full, the payment for Impact
Systems indebtedness. Impact Systems desperately needed the sludge pump for its business since
after it paid the amount of P50,000.00 as downpayment it still persisted in negotiating with
Eurotech which culminated in the execution of the Deed of Assignment of its receivables from
Toledo Power Company. The significant amount of time spent on the negotiation for the sale of the
sludge pump underscores Impact Systems perseverance to get hold of the said equipment. Edwins
participation in the Deed of Assignment was reasonably necessary or was required in order for
him to protect the business of his principal.