8. ANÁLISIS SENSORIAL
8.6. Escalas sensoriales
A sent a letter to B authorizing C to buy abaca/copra. B transacted with C.
Consequently, from Jan. 2, the purchases remained unpaid. B complained to A. A contended that before Jan. 2 he revoked the authorization from C. Therefore, transactions hereafter are not binding upon A.
SC-Invoked Article 1873. Revocation is immaterial. C’s transaction has full force and effect in exercising authority until rescission. If C is specially informed of the
Notes in Civil Law Review 2 revocation of the authorization, B shall also
be informed in the same manner as C.
- JBL REYES: If B had actual knowledge of the revocation, he cannot hold A liable as it would amount to Bad Faith.
Q: What if A actually caused a notice of publication?
A: Can still be liable pursuant to Article 1873
Art. 1873. If a person specially informs another or states by public advertisement that he has given a power of attorney to a third person, the latter thereby becomes a duly authorized agent, in the former case with respect to the person who received the special information, and in the latter case with regard to any person.
The power shall continue to be in full force until the notice is rescinded in the same manner in which it was given. (n)
Classifications of Actual Agency
as to manner of creation
express – consent of both parties given implied
CASE: Dela Pena vs. Hidalgo- After the authorization was executed, the
agent appointed a substitute. The principal did nothing to repudiate such appointment.
SC-There is an Implied agency by the principal’s silence or inaction. The principal is deemed to have accepted the new agency.
Agent
- When the agent is authorized to sell a parcel of land and he just stared at the ceiling, he is NOT deemed to have given his consent. However, if the agent accepted a special power of attorney and he did nothing, it depends upon the kind of business as to consider it as an implied agency, with the agent giving his consent. If the principal and agent are engaged in the same business, there is an implied agency whereby the agent is deemed to have given his consent.
Q: Mere silence of agent deem accepted agency?
A: not necessarily
»If parties are in the same place, no problem, stipulation on the SPA governs Q: if not in the same place such as when using the telegram, if did not reply deem accepted?
A: It depends on the nature of the business, if the task is also within the nature of the agency, yes.
Q: A authorized B to sell land of A in Baguio, did not do anything, Is B an agent?
A: No.
Q: How about if A gave the letter to B and B accepted?
A: There is an implied agency
As to consideration or compensation
Onerous- presumption is for consideration.
Gratuitous- liability is mitigated in the part of the agent.
BAR EXAM QUESTION:
Contract of Agency as to scope of authority 1. Acts of administration
2. Acts of strict dominion
Q: In the sale of Rolex, the agent has no SPA, with the act bind the principal?
A: No. Any act of strict dominion requires an SPA.
As to form:
1. Oral 2.Writing 1. Oral 2.Writing 2.Writing
Q: Why is the form of agency peculiar?
A: Because it involves two contracts, the agency itself and the contract to be contracted by the agent.
Q: Principal was in the hospital and executed a GPA with the following:
- contact of lease of a parcel of land with a term
- contract of lease with no agreement as to term and payment
- contract of sale for a three times higher than the land
-A: Discuss the status: Depends on the power given, GPA was only given
» unenforceable if not in a public instrument
» valid and binding if merely acts of administration
» sale is void under 1874 ; SELLING IS AN ACT OF STRICT DOMINION
Notes in Civil Law Review 2
Q : A is represented by B. There is a lease for 5 years and such lease was not put into writing.
A: First, determine the object. If it is personal, SPA is not required. If it is an immovable, it depends on B’s capacity in the contract of Lease.
Q: 3rd person is the lessee and the principal is the lessor, SPA is needed. However, if the principal is the lessee, authority of A must be in writing in order for it to bind B?
A: Not necessarily. For lease to be in writing or not, the provisions on Statute of Frauds must find application.
BAR EXAMINATION QUESTION
Q: The deceased principal authorized the agent to dispose of his land. The heirs of the principal, however, sold the 12 hectares to B. The agent sold the same land to C.
Who has the better right?
A: It depends on the authority of the agent.
If it is not in writing, the contract of sale is void. Thus, C has a better right.
Q: If it is in writing, the authority of the agent is extinguished. B has a better right?
A: Not necessarily. If the agent has no knowledge of the death of the principal and C is in good faith, C being the 1st registrant, therefore, C has a better right.
»Notarization or recording in a public instrument is not a requirement.
CASE:Jimenez-X mailed a letter to Y giving him the authority to sell a parcel of land. So Y sold the same to a third person. The letter is sufficient to bind X.
» In a SPA, the only requirement must be in writing , need not be notarized
Essential Elements 1. consent of the parties 2. object
3. act within the scope
4. act in representation of principal
» 3 and 4 are not necessary to the validity of the contract but these are the obligations of the agent. Absence of these, Agency remains valid.
3 and 4 are the TWIN REQTS.
How to know whether it is within or in excess of authority?
Consider the SPA.
CASE: Linan
- Whether or not the agent is authorized to sell a parcel of land.
Justice Perfecto: under the SPA, he has no authority. Good faith is not within the scope.
Rely on the provisions of law- the authority to manage the restaurant includes the authority to buy the equipments.
Art. 1882. The limits of the agent's authority shall not be considered exceeded should it have been performed in a manner more advantageous to the principal than that specified by him. (1715)
Article 1882- Considered within if it is to the advantage of
the Principal.
CASE:Insular
Drug-The agent’s authority to collect money does not include encashing or endorsing of check.
Municipality of Ilo-ilo vs. Evangelista
»The authority to hire a lawyer includes authority to pay said lawyer.
»If the agent’s authority to borrow money and mortgage, he cannot use it to satisfy his own debts.
Q: A authorized B to borrow money from any bank, agent borrowed money in his name to buy land, defaulted, can bank go after the principal
A: No. Third person may have recourse against principal except if it was property of principal which was involve
Q: SPA may be oral?
A: NO! It is a written authorization as the following provision provides:
1871 “delivers”
1872 “transmit”
1900
1902 “presentation”
Notes in Civil Law Review 2 Art. 1871. Between persons who are
present, the acceptance of the agency may also be implied if the principal delivers his power of attorney to the agent and the latter receives it without any objection. (n) Art. 1872. Between persons who are absent, the acceptance of the agency cannot be implied from the silence of the agent, except:
(1) When the principal transmits his power of attorney to the agent, who receives it without any objection;
(2) When the principal entrusts to him by letter or telegram a power of attorney with respect to the business in which he is habitually engaged as an agent, and he did not reply to the letter or telegram. (n) Art. 1900. So far as third persons are concerned, an act is deemed to have been performed within the scope of the agent's authority, if such act is within the terms of the power of attorney, as written, even if the agent has in fact exceeded the limits of his authority according to an understanding between the principal and the agent. (n) Art. 1902. A third person with whom the agent wishes to contract on behalf of the principal may require the presentation of the power of attorney, or the instructions as regards the agency. Private or secret orders and instructions of the principal do not prejudice third persons who have relied upon the power of attorney or instructions shown them. (n)
Rights and Obligations of the Agent
His main obligation is to CARRY OUT THE AGENCY.
If the principal died…
GR: The agency is extinguished.
EXC: If it will endanger the Agency, the latter shall be continued Ex: X sold the car to Y with the breaks in a defective condition and without the principal’s knowledge, Y bought the car. Therefore, the principal incurred loss/damage.
(Art. 1888- An agent shall not carry out an agency if its execution would manifestly result in loss or damage to the principal.)
Art. 1888. An agent shall not carry out an agency if its execution would manifestly
result in loss or damage to the principal.
(n)
Liability of Agents to 3rd persons:
Personally bound himself Acted negligently
Acted outside the scope of his authority
Even if the agent acted outside the scope of his authority, the agent is NOT liable if:
The principal ratified the agent’s acts
The 3rd person was informed by the agent that he acted outside
The 3rd person was aware thereof
CASE:Domingo vs.
Domingo-Whatever commission is received by the agent as a consequence of his agency, albeit the absence of knowledge of the principal of the agreement between the 3rd person and the agent, the latter shall give to the principal whatever he received.
The agent is not the insurer of the principal’s success in business.
GR: The agent cannot sell the goods on credit.
EXC: Without consent of the principal, the sale is not void but the principal holds him liable as sale in cash basis.
Q: When can agent be held liable?
A: When he bound himself.
Exception:
1. When the principal ratified
2. When 3rd person informed that agent is acting beyond the scope of his authority
3. When agent informed 3rd person such as when he promise to secure ratification and was not able to Case Law
Q: P authorized A too sell his house and A introduced prospective buyer. The buyer gave him 1K. P terminated the authority of the agent and the agent went to RD and found out that a sale was consummated. A demanded commission, can the case prosper?
SC: No. Failure of agent to deliver to principal even not owing to him the 1k given by the buyer constitute a forfeiture of agent’s right to commission
Notes in Civil Law Review 2 Case Law:
Q: Agent to collect P800 he was able to collect only P500 and deducted 20% as commission.
SC: The act of the agent constitutes estafa.
BAR EXAM QUESTION:
Q: A authorized B to sell property in Cebu, B appointed a subagent. Can B appoint a subagent?
UPLAW Center:
A: Yes, under 1892 if it was not prohibited.
» Sir said with due respect to the UP law Center, the answer is erroneous.
Subagent – does not take the relationship of B as agent; assistant agent
Art. 1892. The agent may appoint a substitute if the principal has not prohibited him from doing so; but he shall be responsible for the acts of the substitute:
(1) When he was not given the power to appoint one;
(2) When he was given such power, but without designating the person, and the person appointed was notoriously incompetent or insolvent.
All acts of the substitute appointed against the prohibition of the principal shall be void. (1721)
Substitute – “kapalit niya” Article 1892 shall apply
» if principal was informed of the substitute Article 1892 shall not apply
Modes of Extinguishment (EDWARD)
E- expiration of the period D- death
W- withdrawal A- accomplishment R- revocation
D- dissolution of entity
» not exclusive, Article 1231 also applies
Other modes may apply to agency.
BAR EXAM QUESTION
Q: X authorized Y to sell a pendant with diamond. The pendant was robbed. X sued Y. Y’s defense is robbery.
A: Austria Case - Robbery is a fortuitous event.
- The perpetrators need not be convicted of robbery.
- For a fortuitous event to be a valid defense, there must be no concurrent event.
- However, if it happened today, Agent is considered to be negligent. If it happened in the 60’s, the agent is not liable.
- The SC held that the agent is liable because there’s negligence.
On Death
Effect of death of the agent
It will absolutely extinguish the agency. If the agency is for the benefit of a 3rd person, the agency will continue to be in full force and effect despite the death of the principal.
Effect of death of the principal If without knowledge and the agent is in good faith, the agency is extinguished but the act of registration in good faith even after the death of the principal is valid as the law says so.
On Revocation
May be made anytime; at will
Q: If there’s a period, will the revocation before the stipulated period hold the principal liable?
A: NO.
CASE:Barreto
Agency is based on trust and confidence therefore, the principal can revoke anytime.
P can only be held liable for damages if he acted in bad faith.
CASE: Collongco
A authorized B to sell the land for 100M. B did not remit the 100M. What was agreed was that B will be the agent of A in subdividing the land and constituting the house. The proceeds will go to A as payment. The authority granted was for 10 yrs. On the 5th yr., A revoked the authority given to B. Was the revocation valid?
SC: NO. The agency is was coupled with interest and as such, it cannot be validly revoked after the interest ceases; means of fulfilling interest must be different from
Notes in Civil Law Review 2 the commissioner given; very interest that
an agent is claiming should be stated at the SPA without prejudice to his liability if revocation was done in bad faith
Pvt/101707
VI. PARTNERSHIP
BAR EXAM:
A used all his savings to put up a
restaurant, B gave A 4k as financial assistance in exchange of 20% profits, 22 years after B filed action demanding profits. A denied and invoked prescription.
A: UP Law Center – Contract of Partneship exists because they contributed to a common fund plus there was a stipulation as to profit.
»Sir said, no contract of partnership exists. There was no agreement to contribute to a common fund, only financial assistance.
Q: Partnership vs. Co-ownership
A: Contract of partnership is created by mere agreement while co-ownership is created by operation of law.
Essential Element:
» object is to engage in a lawful activity
General Partnership and Limited Partnership (relevant only in Limited Partnership)
Q: Can the spouses enter into a limited partnership and engage in real estate business A: Yes, prohibition is only on universal partnership Q: Can two corporations organize a general partnership, can a corporation enter into a partnership?
A: No! Corporation and partnership may organize a joint venture but they cannot enter into
partnership contract
» Sir said that Corporation can enter into a contract of partnership if there was an express grant of power in its articles of incorporation.
(Tecson vs. Bolaños)
Q: What is the effect of illegality of contract? Can a partner recover what he had given if cause was illegal?
A: Yes, because it will result in unjust enrichment.
Q; How about if both was in pari delicto?
A: If there was repudiation before there was any damage, the court is in its discretion to allow recovery
BAR QUESTION: A and B put up a car repair shop. A contributed money while B contributed his services. A likewise put up a coffee shop on the left side of the car repair shop. B likewise engaged in another business of his own. Are they legally allowed to venture into such businesses?
ANSWER: A under the facts can engage in such services since he is only a capitalist partner. As to B, since he is an industrial partner, he is prohibited from engaging in any kind of business without the consent of the other partners.
» Partnership may be constituted in any other form. – Article 1172
Q: How about 3rd person who contracted with Partnership with unlawful object, can recover?
A: Yes, as long as no knowledge of the illegality
When one or more parties contribute an immoveable
If there is no inventory – VOID;
If there is an inventory, but not put in writing
If such partnership is not put into public instrument -> it will not affect the validity of the partnership agreement, though it may affect the greater efficacy or the enforceability of the contract.
Case: Hernandez v. Angeles
» Form is not necessary for the validity, maybe necessary for enforceability
»ENTITY THEORY/LEGAL PERSON THEORY means that a partnership has a juridical personality separate and distinct from the partners
A general partner can be an industrial partner.
Can a partner be both capitalist and industrial partner at the same time? YES
Can a limited partner be both an industrial and a capitalist partner at the same time?
NO
CLASSIFICATION OF PARTNERSHIP:
I. As to Object:
a) present property b) profits
II. a) General » all general partners
b) Limited » one or more general and one or more limited partner; a limited
partner (has no right to partake in the management
Commercial Partnership » governed by Code of Commerce
III. As to term:
a) maybe for a particular undertaking (Ortega vs. CA)
Admission of a new partner
»If given a question concerning the liability of a newly-admitted partner for a partnership obligation, ask, “when was the partnership obligation incurred? Was it incurred PRIOR TO / AFTER the new partner’s admission to the partnership?
Notes in Civil Law Review 2 Q: ABC partnership admitted D as new partner.
The ABC partnership incurred the following liabilities. ABC- 100; X- 30K, A- 50k. What is the liability of D as a new partner? If A is a managing partner.
A: GR: up to capital contribution only unless he bound himself to be solidarily liable
NOTA BENE: application of proportionate sharing:
a) if A is a general partner b) both debts are due and
demandable
c) receipt was given in the name of the partnership d) payment should be applied
to the most onerous LIMITED PARTNER IS LIABLE WHEN:
a) he participated in the management b) if surname appears in the partnership
name except;
a) already existing surname b) if also the surname of a general
partnership
c) if at the same time general or limited partner
» Article 1892 subagent is not equivalent to substitute
» in having a substitute, must be with the knowledge of the principal. (De la Peña vs.
Hidalgo)
Proportional Application of Debts:
One obtaining is a managing partner;
Both debts are due and demandable;
If the partner receipted the amount in the name of the partnership
estoppel
agency
If the debt is more onerous Property Rights of a Partner
see the 3 major classification of the property rights of partners
plus right to formal accounting
plus the right to the access of partnership book
Rights in specific partnership property = a partner is co-owner with his partners of specific partnership property; see 1811 = co-ownership sui generis.
Cf. co-ownership in partnership
Cf. co-ownership in partnership