agency written digest

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65) ORIENT AIR SERVICES AND HOTEL REPRESENTATIVES vs. COURT OF APPEALS

CASE NUMBER: GR. NO. 76931 DATE: MAY 29, 1991

PONENTE: PADILLA, J.

FACTS:

January 15 1977- American Airlines, Inc. an air carrier offering passenger and air cargo transportation in the Philippines, and Orient Air Services and Hotel Representatives entered into a General Sales Agency Agreement, whereby the former authorized the latter to act as its exclusive general sales agent within the Philippines for the sale of air passenger transportation.

May 11 1981- American Air took charge of the collection of the proceeds of tickets sold originally by Orient Air and terminated the Agreement in accordance with Paragraph 13 thereof (Termination).

13. Termination American may terminate the Agreement on two days' notice in the event Orient Air Services is unable to transfer to the United States the funds payable by Orient Air Services to American under this Agreement. Either party may terminate the Agreement without cause by giving the other 30 days' notice by letter, telegram or cable.

May 15 1981- American Air instituted suit against Orient Air with the Court of First Instance of Manila, for Accounting with Preliminary Attachment or Garnishment, Mandatory Injunction and Restraining Order

In its Answer with counterclaim dated 9 July 1981, Orient Air denied the material allegations of the complaint with respect to plaintiff's entitlement to alleged unremitted amounts, contending that after application thereof to the commissions due it under the Agreement, plaintiff in fact still owed Orient Air a balance in unpaid overriding commissions. Further, the defendant contended that the actions taken by American Air in the course of terminating the Agreement as well as the termination itself were untenable, Orient Air claiming that American Air's precipitous conduct had occasioned prejudice to its business interests.

Trial Court ruled in favor of Orient Air

ON APPEAL: Intermediate Appellate Court affirmed the ruling of TC

ISSUE: W/N the respondent appellate court correctly ruled that Orient Air be reinstated again as sales agent of American Air RULING: By affirming this ruling of the trial court, respondent appellate court, in effect, compels American Air to extend its personality to Orient Air. Such would be violative of the principles and essence of agency, defined by law as a contract whereby "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 . In an agent-principal relationship, the personality of the principal is extended through the facility of the agent. In so doing, the agent, by legal fiction, becomes the principal, authorized to perform all acts which the latter would have him do. Such a relationship can only be effected with the consent of the principal, which must not, in any way, be compelled by law or by any court. The Agreement itself between the parties states that "either party may terminate the Agreement without cause by giving the other 30 days' notice by letter, telegram or cable." (emphasis supplied) We, therefore, set aside the portion of the ruling of the respondent appellate court reinstating Orient Air as general sales agent of American Air. WHEREFORE, with the foregoing modification, the Court AFFIRMS the decision and resolution of the respondent Court of Appeals, dated 27 January 1986 and 17 December 1986, respectively. Costs against petitioner American Air.

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66) RALLOS vs. FELIX GO CHAN & SONS REALTY CORPORATION

CASE NUMBER: L-24332 DATE: January 31, 1978

PONENTE: Munoz-Palma, J.

FACTS:

Concepcion and Gerundia Rallos were sisters and registered co-owners of a parcel of land known as Lot No. 5983 of the Cadastral Survey of Cebu covered by Transfer Certificate of Title No. 11116 of the Registry of Cebu.

They executed a special power of attorney in favor of their brother, Simeon Rallos, authorizing him to sell such land for and in their behalf.

After Concepcion died, Simeon Rallos sold the undivided shares of his sisters Concepcion and Gerundia to Felix Go Chan & Sons Realty Corporation for the sum of P10,686.90. New TCTs were issued to the latter.

Petitioner Ramon Rallos, administrator of the Intestate Estate of Concepcion filed a complaint praying (1) that the sale of the undivided share of the deceased Concepcion Rallos in lot 5983 be unenforceable, and said share be reconveyed to her estate; (2) that the Certificate of 'title issued in the name of Felix Go Chan & Sons Realty Corporation be cancelled and another title be issued in the names of the corporation and the "Intestate estate of Concepcion Rallos" in equal undivided and (3) that plaintiff be indemnified by way of attorney's fees and payment of costs of suit.

CFI: [Plaintiffs Complaint]

Sale of land was null and void insofar as the one-half pro-indiviso share of Concepcion Rallos

Ordered the issuance of new TCTs to respondent corporation and the estate of Concepcion in the proportion of share each pro-indiviso and the payment of attorneys fees and cost of litigation

[Respondent filed cross claim against Simon Rallos(*Simon and Gerundia died during pendency of case)]

Juan T. Borromeo, administrator of the Estate of Simeon Rallos was ordered to pay defendant the price of the share of the land (P5,343.45) plus attorneys fees

[Borromeo filed a third party complaint against Josefina Rallos, special administratrix of the Estate of Gerundia]

Dismissed without prejudice to filing either a complaint against the regular administrator of the

Estate of Gerundia Rallos or a claim in the Intestate-Estate of Cerundia Rallos, covering the same subject-matter

CA: CFI Decision reversed, upheld the sale of Concepcions share. MR: denied. ISSUES & RULING:

1) WON sale was valid although it was executed after the death of the principal, Concepcion.? Sale was void. o No one may contract in the name of another

without being authorized by the latter, or unless he has by law a right to represent him (Art. 1317 of the Civil Code).

o Simons authority as agent was extinguished upon Concolacions death

2) WON sale fell within the exception to the general

rule that death extinguishes the authority of the agent The sale did not fall under the exceptions to the

general rule that death ipso jure extinguishes the authority of the agent

o Art. 1930 inapplicable: SPA in favor of Simon Rallos was not coupled with interest

o Art. 1931 inapplicable: Simon Rallos knew (as can be inferred from his

pleadings) of principal Concepcions death For Art 1931 to apply, both requirements must

be present

3) WON agents knowledge of the principals death is a material factor. Yes, agents knowledge of principals death is

material. o Respondent asserts that: there is no provision

in the Code which provides that whatever is done by an agent having knowledge of the death of his principal is void even with respect to third persons who may have contracted with him in good faith and without knowledge of the death of the principal

o Court says: this contention ignored the ignores the existence of the general rule enunciated in Article 1919 that the death of the principal

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extinguishes the agency. Article 1931, being an exception to the general rule, is to be strictly

construed.

67) AIR FRANCE vs. COURT OF APPEALS CASE NUMBER: G.R. No. L-57339 DATE: December 29, 1983

PONENTE: MELENCIO-HERRERA, J.

CAUSE OF ACTION: Petition for review on certiorari assailing the Decision of then respondent Court of Appeals promulgated "Jose G. Gana, et al. vs. Sociedad Nacionale Air France", which reversed the Trial Court's judgment dismissing the Complaint of private respondents for damages arising from breach of contract of carriage, and awarding instead P90,000.00 as moral damages. FACTS:

1. Late Jose G. Gana and his family (the GANAS), purchased from AIR FRANCE (9) "open-dated" air passage tickets for the Manila/Osaka/Tokyo/Manila route. On 24 April 1970, AIR FRANCE exchanged or substituted the aforementioned tickets with other tickets for the same route. At this time, the GANAS were booked for the Manila/Osaka segment on AIR FRANCE Flight 184 for 8 May 1970, and for the Tokyo/Manila return trip on AIR FRANCE Flight 187 on 22 May 1970.

2. The aforesaid tickets were valid until 8 May 1971. The GANAS did not depart on 8 May 1970. Instead, Jose Gana sought the assistance of Teresita Manucdoc, a Secretary of the Sta. Clara Lumber Company where Jose Gana was the Director and Treasurer, for the extension of the validity of their tickets, which were due to expire on 8 May 1971.

3. Teresita enlisted the help of Lee Ella Manager of the Philippine Travel Bureau. Ella sent the tickets to Cesar Rillo, Office Manager of AIR FRANCE. The tickets were returned to Ella who was informed that extension was not possible unless the fare differentials resulting from the increase in fares triggered by an increase of the exchange rate of the US dollar to the Philippine peso and the increased travel tax were first paid. Ella then returned the tickets to Teresita and informed her of the impossibility of extension.

4. In the meantime, the GANAS had scheduled their departure on 7 May 1971 or one day before the expiry date. Teresita requested travel agent Ella to arrange the revalidation of the tickets. Ella gave the same negative answer and warned her that although the tickets could be used by the GANAS if they left on 7 May 1971, the tickets would no longer be valid for the rest of their trip because the tickets would then have expired on 8 May 1971. Teresita replied that it will be up to the GANAS to make the arrangements.

5. With that assurance, Ella on his own, attached to the tickets validating stickers for the Osaka/Tokyo flight, one a JAL. sticker and the other an SAS (Scandinavian Airways System) sticker. The SAS sticker indicates thereon that it was "Reevaluated by: the Philippine Travel Bureau, Branch No. 2" (as shown by a circular rubber stamp) and signed "Ador", and the date is handwritten in the center of the circle. Then appear under printed headings the notations: JL. 108 (Flight), 16 May (Date), 1040 (Time), OK (status). Apparently, Ella made no more attempt to contact AIR FRANCE as there was no more time.

6. Notwithstanding the warnings, the GANAS departed from Manila in the afternoon of 7 May 1971 on board AIR FRANCE Flight 184 for Osaka, Japan. There is no question with respect to this leg of the trip.

7. However, for the Osaka/Tokyo flight on 17 May 1971, Japan Airlines refused to honor the tickets because of their expiration, and the GANAS had to purchase new tickets. They encountered the same difficulty with respect to their return trip to Manila as AIR FRANCE also refused to honor their tickets. They were able to return only after pre-payment in Manila, through their relatives, of the readjusted rates. They finally flew back to Manila on separate Air France Frights on 19 May 1971 for Jose Gana and 26 May 1971 for the rest of the family.

8. On 25 August 1971, the GANAS commenced before the then Court of First Instance of Manila, Branch III, Civil Case No. 84111 for damages arising from breach of contract of carriage.

9. AIR FRANCE traversed the material allegations of the Complaint and alleged that the GANAS brought upon themselves the predicament they found themselves in and assumed the consequential risks; that travel agent Ella's affixing of validating stickers on the tickets without the knowledge and consent of AIR FRANCE, violated airline tariff rules and regulations and was beyond the scope of his authority as a travel agent; and that AIR FRANCE was not guilty of any fraudulent conduct or bad faith.

10. TC dismissed the Complaint of the GANAS based on Partial and Additional Stipulations of Fact .

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11. The GANAS appealed to the CA. During the pendency of the appeal, Jose Gana, the principal plaintiff, died. 12. CA set aside and reversed the TCs decision ordering Air France to pay appellants moral damages in the total sum

P90,000.00 plus costs. 13. Reconsideration sought by AIR FRANCE was denied, hence, petitioner's recourse before this instance, to which we

gave due course. ISSUE:

1. Whether or not, under the environmental milieu the GANAS have made out a case for breach of contract of carriage entitling them to an award of damages? No!

2. Whether or not Teresita was the agent of the GANAS and notice to her of the rejection of the request for extension of the validity of the tickets was notice to the GANAS, her principals? YES!

RULING: No! SC reversed the affirmative ruling of the CA. (As for the mainFIRST issue) AIR FRANCE cannot be faulted for breach of contract when it dishonored the tickets of the GANAS after 8 May 1971 since those tickets expired on said date; nor when it required the GANAS to buy new tickets or have their tickets re-issued for the Tokyo/Manila segment of their trip. Neither can it be said that, when upon sale of the new tickets, it imposed additional charges representing fare differentials, it was motivated by self-interest or unjust enrichment considering that an increase of fares took effect, as authorized by the Civil Aeronautics Board (CAB) in April, 1971. This procedure is well in accord with the IATA tariff rules which provide:

6. TARIFF RULES 7. APPLICABLE FARE ON THE DATE OF DEPARTURE 3.1 General Rule. All journeys must be charged for at the fare (or charge) in effect on the date on which transportation commences from the point of origin. Any ticket sold prior to a change of fare or charge (increase or decrease) occurring between the date of commencement of the journey, is subject to the above general rule and must be adjusted accordingly. A new ticket must be issued and the difference is to be collected or refunded as the case may be. No adjustment is necessary if the increase or decrease in fare (or charge) occurs when the journey is already commenced.

The GANAS cannot defend by contending lack of knowledge of those rules since the evidence bears out that Teresita, who handled travel arrangements for the GANAS, was duly informed by travel agent Ella of the advice of Reno, the Office Manager of Air France, that the tickets in question could not be extended beyond the period of their validity without paying the fare differentials and additional travel taxes brought about by the increased fare rate and travel taxes. Teresita was the agent of the GANAS and notice to her of the rejection of the request for extension of the validity of the tickets was notice to the GANAS, her principals. (AGENCY: NOTICE TO THE AGENT IS NOTICE TO THE PRINCIPAL) The circumstances that AIR FRANCE personnel at the ticket counter in the airport allowed the GANAS to leave is not tantamount to an implied ratification of travel agent Ella's irregular actuations. It should be recalled that the GANAS left in Manila the day before the expiry date of their tickets and that "other arrangements" were to be made with respect to the remaining segments. Besides, the validating stickers that Ella affixed on his own merely reflect the status of reservations on the specified flight and could not legally serve to extend the validity of a ticket or revive an expired one. The conclusion is inevitable that the GANAS brought upon themselves the predicament they were in for having insisted on using tickets that were due to expire in an effort, perhaps, to beat the deadline and in the thought that by commencing the trip the day before the expiry date, they could complete the trip even thereafter. It should be recalled that AIR FRANCE was even unaware of the validating SAS and JAL. stickers that Ella had affixed spuriously. Consequently, Japan Air Lines and AIR FRANCE merely acted within their contractual rights when they dishonored the tickets on the remaining segments of the trip and when AIR FRANCE demanded payment of the adjusted fare rates and travel taxes for the Tokyo/Manila flight. WHEREFORE, the judgment under review is hereby reversed and set aside, and the Amended Complaint filed by private respondents hereby dismissed.

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No costs.

68) SANTOS vs. BUENCONSEJO

CASE NUMBER: G.R. No. L-20136 DATE: June 23, 1965

PONENTE: CONCEPCION, J

FACTS:

1. Petitioner Jose A. Santos y Diaz seeks the reversal of an order of the Court of First Instance of Albay, denying his petition:

a. Cancellation of original certificate of title No. RO-3848 (25322), issued in the name of Anatolio Buenconsejo, Lorenzo Bon and Santiago Bon, and covering Lot No. 1917 of the Cadastral Survey of Tabaco, Albay, and

b. Issuance in lieu thereof, of a separate transfer certificate of title in his name. 2. Lot No. 1917 covered by Original Certificate of Title No. RO-3848 (25322) was originally owned in common by

Anatolio Buenconsejo to the extent of undivided portion and Lorenzo Bon and Santiago Bon to the extent of the other (Exh. B)

3. Anatolio Buenconsejo's rights, interests and participation over the portion abovementioned were by a Certificate of Sale executed by the Provincial Sheriff of Albay, transferred and conveyed to Atty. Tecla San Andres Ziga, awardee in the corresponding auction sale conducted by said Sheriff

4. By a certificate of redemption issued by the Provincial Sheriff of Albay, the rights, interest, claim and/or or participation which Atty. Tecla San Andres Ziga may have acquired over the property in question by reason of the aforementioned auction sale award, were transferred and conveyed to the herein petitioner in his capacity as Attorney-in-fact of the children of Anatolio Buenconsejo, namely, Anastacio Buenconsejo, Elena Buenconsejo and Azucena Buenconsejo (Exh. C).

5. Petitioner Santos had redeemed the aforementioned share of Anatolio Buenconsejo, upon the authority of a special power of attorney executed in his favor by the children of Anatolio Buenconsejo.

6. Relying upon this power of attorney and redemption made by him, Santos now claims to have acquired the share of Anatolio Buenconsejo in the aforementioned Lot No. 1917;

7. As the alleged present owner of said share, Santos caused a subdivision plan of said Lot No. 1917 to be made, in which the portion he claims as his share thereof has been marked as Lot No. 1917-A; and that he wants said subdivision at No. 1917-A to be segregated from Lot No. 1917 and a certificate of title issued in his name exclusively for said subdivision Lot No. 1917-A.

8. Lower court: ruled in favor of the respondents. ISSUE: Whether or not petitioner Santos claim that he has acquired the share of Anatolio Buenconsejo in Lot No. 1917 relying upon a power of attorney and redemption made by him is tenable? RULING: No! SC affirmed the lower courts decision that petitioner's claim is clearly untenable, for three reasons:

a. Said special power of attorney authorized him to act on behalf of the children of Anatolio Buenconsejo, and, hence, it could not have possibly vested in him any property right in his own name; (

b. The children of Anatolio Buenconsejo had no authority to execute said power of attorney, because their father is still alive and, in fact, he and his wife opposed the petition of Santos;

c. In consequence of said power of attorney (if valid) and redemption, Santos could have acquired no more than the share pro indiviso of Anatolio Buenconsejo in Lot No. 1917, so that petitioner cannot without the conformity of the other co-owners (Lorenzo and Santiago Bon), or a judicial decree of partition issued pursuant to the provisions of Rule 69 of the new Rules of Court (Rule 71 of the old Rules of Court) which have not been followed By Santos adjudicate to himself in fee simple a determinate portion of said Lot No. 1917, as his share therein, to the exclusion of the other co-owners.

Inasmuch as the appeal is patently devoid of merit, the order appealed from is hereby affirmed, with treble cost against petitioner-appellant Jose A. Santos y Diaz. It is so ordered.

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69) ALBADEJO y CIA vs. PHILIPPINE REFINING CO.

CASE NUMBER: G.R. No. L-20726 DATE: December 20, 1923

PONENTE: Street, J.

FACTS: It appears that Albaladejo y Cia. is a limited partnership, organized in conformity with the laws of these Islands, and having its principal place of business at Legaspi, Albay. The firm was engaged in the buying and selling of the products of the country, especially copra. The Visayan Refining Co. is a corporation organized engaged in operating its extensive plant at Opon, Cebu, for the manufacture of coconut oil. On August 28, 1918, the plaintiff made a contract with the Visayan Refining Co., the material parts of which are as follows: (important provisions)

- The party of the first part (Albadejo) agrees and binds itself to sell to the party of the second part (Visayan Refining Co.) , and the party of the second part agrees and binds itself to buy from the party of the first part, for a period of one (1) year

- During the continuance of this contract the party

of the second part will not appoint any other agent for the purchase of copra in Legaspi, nor buy copra from any vendor in Legaspi.

- The party of the second part will provide

transportation by sea to Opon, Cebu, for the copra delivered to it by the party of the first part, but the party of the first part must deliver such copra to the party of the second part free on board the boats of the latter's ships or on the pier alongside the latter's ships.

Pursuant to this agreement the plaintiff bought copra extensively for the Visayan Refining Co. for a year. At the end of said year both parties found themselves satisfied with the existing arrangement, and they therefore continued by tacit consent to govern their future relations by the same agreement.

When the contract above referred to was originally made, Albaladejo y Cia. apparently had only one commercial establishment. After the Visayan Refining Co. had ceased to buy copra, the supplies of copra already purchased by the plaintiff were gradually shipped out and accepted by \the Visayan Refining Co. In next eight or ten months the accounts between the two parties were liquidated. The last account rendered by the Visayan Refining Co. to the plaintiff was for the month of April, 1921, and it showed a balance of P288 in favor of the defendant. Under date of June 25, 1921, the plaintiff company addressed a letter from Legaspi to the Philippine Refining Co. (which had now succeeded to the rights and liabilities of the Visayan Refining Co.), expressing its approval of said account. In this letter no dissatisfaction was expressed by the plaintiff as to the state of affairs between the parties; but about six weeks thereafter the present action was begun. This action was instituted in the CFI Albay by Albaladejo to recover a sum of money from the Philippine Refining Co., as successor to the Visayan Refining Co., two causes of action being stated in the complaint. Upon hearing the cause, the trial judge absolved the defendant from the first cause of action but gave judgment for the plaintiff to recover the sum of P49,626.68, with costs, upon the second cause of action. The plaintiff appealed the first cause of action, and the defendant appealed with respect to the action taken upon the second cause of action. It results that, by the appeal of the two parties, the decision of the lower court is here under review.

ISSUE: Whether he defendant liable for the expenses incurred by the plaintiff in keeping its organization intact during the period now under consideration. RULING: NO

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First cause of action: The alleged negligent failure of the Visayan Refining Co. to provide opportune transportation for the copra collected by the plaintiff and deposited for shipment. Upon consideration of all the facts revealed in evidence (records of shipping), court found that the Visayan Refining Co. had used reasonable promptitude in its efforts to get out the copra from the places where it had been deposited for shipment, notwithstanding occasional irregularities due at times to the condition of the weather as related to transportation by sea and at other times to the inability of the Visayan Refining Co. to dispatch boats to the more remote ports. This finding of the trial judge, that no negligence of the kind alleged can properly be imputed to the Visayan Refining Co., is in our opinion supported by the proof. The trial judge calls attention to the fact that it is expressly provided in paragraph two of the contract that the shrinkage of copra from the time of its delivery to the party of the second part till its arrival at Opon should fall upon the plaintiff, from whence it is to be interfered that the parties intended that the copra should be paid for according to its weight upon arrival at Opon regardless of its weight when first purchased. From what has been said it follows that the first cause of action set forth in the complaint is not well founded, and the trial judge committed no error in absolving the plaintiff therefrom. Second cause of action: Plaintiff seeks to recover the sum of P110,000, the alleged amount expended by the plaintiff in maintaining and extending its organization for Visayan Refining Co. As a basis for the defendant's liability in this respect it is alleged that said organization was maintained and extended at the express request, or requirement, of the defendant, in conjunction with repeated assurances that the defendant would soon resume activity as a purchaser of copra. SC: We note that in his letter of July 10, 1920, Mr. Day suggested that if the various purchasing agents of the Visayan Refining Co. would keep their organization intact, the company would endeavour to see that they should not lose by the transaction in the long run. These words afford no sufficient basis for the conclusion, which the trial judge deduced there from, that the defendant is bound to compensate the plaintiff for the expenses incurred in maintaining its organization. The

correspondence sufficiently shows on its face that there was no intention on the part of the company to lay a basis for contractual liability of any sort; and the plaintiff must have understood the letters in that light. The parties could undoubtedly have contracted about it, but there was clearly no intention to enter into contractual relation; and the law will not raise a contract by implication against the intention of the parties. The inducement held forth was that, when purchasing should be resumed, the plaintiff would be compensated by the profits then to be earned for any expense that would be incurred in keeping its organization intact. It is needless to say that there is no proof showing that the officials of the defendant acted in bad faith in holding out this hope. In the appellant's brief the contention is advanced that the contract between the plaintiff and the VisayanRefining Co. created the relation of principal and agent between the parties, and the reliance is placed upon article1729 of the Civil Code which requires the principal to indemnify the agent for damages incurred in carrying out the agency. Attentive perusal of the contract is, however, convincing to the effect that the relation between the parties was not that of principal and agent in so far as relates to the purchase of copra by the plaintiff. It is true that the Visayan Refining Co. made the plaintiff one of its instruments for the collection of copra; but it is clear that in making its purchases from the producers the plaintiff was buying upon its own account In paragraph three of the contract it is declared that during the continuance of this contract the Visayan Refining Co. would not appoint any other agent forthe purchase of copra in Legaspi; and this gives rise indirectly to the inference that the plaintiff was considered its buying agent. But the use of this term in one clause of the contract cannot dominate the real nature of the agreement as revealed in other clauses, no less than in the caption of the agreement itself. In some of the trade letters also the various instrumentalities used by the Visayan Refining Co. for the collection of copra are spoken of as agents. But this designation was evidently used for convenience; and it is very clear that in its activities as a buyer the plaintiff was acting upon its own account and not as agents of the Visayan Refining Co. The title to all of the copra purchased by the plaintiff undoubtedly remained in it until it was delivered by way of subsequent sale to said company. For the reasons stated we are of the opinion that no liability on the part of the defendant is shown upon the plaintiff's second cause of action, and the judgment of the trial court on this part of the case is erroneous.

70) THOMAS vs. PINEDA

CASE NUMBER: G.R. No. L-2411 DATE: June 28, 1951

PONENTE: not indicated

FACTS: Thomas bought the bar and restaurant known as Silver Dollar Caf at Plaza Sta. Cruz.

He employed Pineda as a bartender-promoted to cashier and manager During Japanese occupation, to prevent the business and its property from falling into enemy hands, Thomas made a fictitious sale to Pineda fictitious sale was admitted by both parties;

2nd agreement which was a secret stating that the sale was fictitious Original building was destroyed by fire, Pineda was able to remove some furniture and a considerable qty of stocks to a place of safety- a bar was opened on Calle Bambang-after 4 months it was transferred to the original location Thomas brought a CPA for the purpose of examining the books- Pineda threatened Thomas with a gun if they persisted in their purpose. So Thomas filed a case and set up another bar

1st CoA- Thomas sought to compel an ACCOUNTING of Pinedas operations during the time he was in control of the bar - Pineda claims that there was a 3rd verbal agreement, the import of which was that he was to operate the business

with no liability other than to turn over to the plaintiff as the plaintiff would find it after the war 2nd CoA: ownership of Silver Dollar Caf trade name it appears that Pineda registered the business as his own RULING: 1st CoA valid

- Little or no weight can be attached to Pinedas assertion .As sole manager with full power to do as his fancies dictated; the defendant could strip the business naked of all its stocks, leaving the plaintiff holding the bag, as it were, when the defendant's management was terminated. Unless Thomas was willing to give away his property and its profits, no man in his right senses would have given his manager an outright license such as the defendant claims to have gotten from his employer.

- The conclusion thus seems clear that the defendant owes the plaintiff an accounting of his management of the plaintiff's business during the occupation. The exact legal character of the defendant's relation to the plaintiff matters not a bit. It was enough to show, and it had been shown, that he had been entrusted with the possession and management of the plaintiff's business and property for the owner's benefit and had not made an accounting.

- It was error for the court below to declare at this stage of the proceeding, on the basis of defendant's incomplete and indefinite evidence, that there were no surplus profits

- Monies and food stuffs which the defendant said he had supplied the plaintiff and his daughters during the war are appropriate items to be considered on taking account

- Upon plaintiffs release from the internment camp, he lost no time in looking for a site where he could open a saloon The use of the old name suggested that the business was in fact an extension and continuation of the Silver Dollar Caf

- Upon the reopening of the bar in the original place- lease was in the name of Thomas; calling cards saying Thomas is the proprietor == defendant was only a manager

2nd

CoA- Thomas is the owner of the trade name - In the fictitious bill of sale Pineda acknowledged Thomas ownership of the business - Business cards: Thomas is the proprietor - No abandonment because when Thomas set up a new saloon it used the same name

The most that can be said is that the plaintiff instructed Pineda to renew the registration of the trade-name and the defendant understood the instruction as permission to make the registration in his favor As legal proposition and in good conscience, the defendants registration of the trade name Silver Dollar Cafe must be deemed to have been affected for the benefit of its owner of whom he was a mere trustee or employee. "The relations of an agent to his principal are fiduciary and it is an elementary and very old rule that in regard to property forming the subject matter of the agency, he is estopped from acquiring or asserting a title adverse to that of principal. His position is analogous to that of a trustee and he cannot consistently, with the principles of good faith, be allowed to create in himself an interest in opposition to that of his principal or cestuique trust. A receiver, trustee, attorney, agent or any other person occupying fiduciary relations respecting property or persons utterly disabled from acquiring for his own benefit the property committed to his custody for management. The rule stands on the moral obligation to refrain from placing one's self in position which ordinarily excite conflicts between self-interest at the expense of one's integrity and duty to another, by making it possible to profit by yielding to temptation

71) PALMA VS. CRISTOBAL CASE NUMBER: G.R. No. L-49219 DATE: December 11, 1946

PONENTE: Perfecto, J.

FACTS:

A parcel of a land located in Quesada Street, Tondo, Manila, covered by transfer certificate of title No. 31073 of the Register of Deeds of Manila, issued in favor of petitioner Pablo D. Palma, is the subject of contention between the parties.

o Petitioner sought, at first, to eject respondent Eduardo Cristobal Reyes from the land in question in a complaint filed with the Municipal Court of Manila. As respondent raised the question of ownership, the complaint was dismissed, and petitioner filed with the Court of First Instance of Manila the complaint which initiated this case, petitioner praying that he be declared the owner of the land and that respondent be ordered to restore its possession and to remove his house therefrom.

o The complaint was dismissed and petitioner brought the case to the Court of Appeals, where he again failed. o The case is appealed by certiorari.

In 1909, after registration proceedings under the provisions of Act No. 496, original certificate of title No. 1627 was issued in the names of petitioner and his wife Luisa Cristobal.

In 1923, said certificate was cancelled and substituted by certificate of title No. 20968 by virtue of a decree issued by the Court of First Instance of Manila in connection with Manila cadastre.

It was later substituted by certificate of title No. 26704, also in the name of petitioner and his wife.

After the wifes death in 1922,a new certificate of title was issued in 1923 only in the name of the name of the petitioner, substituted in 1928 by certificate of title No. 31073.

The Court of Appeals, upon the evidence, concluded with the Court of First Instance of Manila that the parcel of land in question is a community property held by petitioner in trust for the real owners (the respondent being an heir of one of them), the registration having been made in accordance with an understanding between the co-owners, by reason of the confidence they had in petitioner and his wife. This confidence, close relationship, and the fact that the co-owners were receiving their shares in the rentals, were the reasons why no step had been taken to partition the property.

It was only after the death of Luisa Cristobal and petitioner had taken a second wife that trouble on religious matters arose between petitioner and respondent, and it gives credence to the testimony of Apolonia Reyes and respondent to the effect that Luisa, before her death, called her husband, the petitioner, and enjoined him to give her co-owners their shares in the parcel of land; but respondent told her then not to worry about it, for it was more important to them to have her cured of the malady that affected her. Petitioner answered his wife that she should not worry because he would take care of the matter by giving the co-owners their respective shares.

After Luisa Cristobal, petitioners wife, died in 1922, instead of moving for the partition of the property, considering specially that petitioner had promised such a partition at the deathbed of the deceased, respondent appeared as attorney for petitioner and prayed that a new certificate of title be issued in the name of said petitioner as the sole owner of the property.

Petitioner assigns as first error of the Court of Appeals the fact that it considered the oral testimony adduced in behalf of respondent sufficient to rebut the legal presumption that petitioner is the owner of the land in controversy. . In Severino vs. Severino (43 Phil. 343), this court declared that Affirming the said doctrine in Barretto vs. Tuason (50 Phil.

888), the Supreme Court declared that In Palet vs. Tejedor (55 Phil. 790), it was declared that This right to recover is sanctioned by section 55 of Act No. 496, as amended by Act No. 3322. There is no showing why the conclusions of facts of the Court of Appeals should be disturbed, and upon said facts petitioners first assignment of errors appears to be untenable in the light of law and of the decision of this court. Petitioner alleged that the Court of Appeals erred in not holding ISSUE: Whether the respondent is estopped from claiming that petitioner is not the absolute owner of the property in

question. RULING: No

The fact that respondent has been a party to the deception which resulted in petitioners securing in his name the title to a property not belonging to him, is not valid reason for changing the legal relationship between the latter and its true owners to such an extent as to let them lose their ownership to a person trying to usurp it.

Respondent is not barred because his appearance as attorney for petitioner was not a misrepresentation which would induce petitioner to believe that respondent recognized the former as the sole owner of the property in controversy.

Respondents appearance, as attorney for petitioner in 1923, was a consequence of the understanding, and petitioner could not legitimately assume that it had the effect of breaking or reversing said understanding.

Lastly, it is contended by petitioner that, even conceding that the controverted property was owned in common by several co-owners, yet the Court of Appeals erred in not holding that, as against respondent, ISSUE: Whether petitioner had acquired absolute ownership of the property through prescription. Upon the premise that the registration in 1909 in the name of petitioner and his wife, Luisa Cristobal, was in accordance with an agreement among the co-owners, petitioner advances the theory that when he, upon the death of his wife in 1922, caused the trust property to be registered in his sole name in 1923, and subsequently partitioned between himself and his daughter, Ildefonsa Cristobal Ditangco, as heirs of the decedent, he openly breached the agreement of 1909 as well as the promise made to his dying wife of giving the co-owners their respective shares, concluding that that breach was an assumption of ownership, and could be the basis of title by prescription. RULING No, Petitioners pretension of building his right to claim ownership by prescription upon his own breach of a trust

cannot be countenanced by any court, being subversive of generally accepted ethical principles.

Petitioner held the property and secured its registration in his name in a fiduciary capacity, and it is elementary that a trustee cannot acquire by prescription the ownership of the property entrusted to him.

The position of a trustee is of representative nature. His position is the position of a cestui que trust.

It is logical that all benefits derived by the possession and acts of the agent, as such agent, should accrue to the benefit of his principal.

The registration of the property in the name of the trustees in possession thereof, must be deemed to have been effected for the benefit of the cestui que trust.

whether or not there is bad faith or fraud in obtaining a decree with respect to a registered property, the same does not belong to the person in whose favor it was issued, and the real owners be entitled to recover the ownership of the property so long as the same has not been transferred to a third person who has acquired it in good faith and for a valuable consideration.

72) VALERA VS. VELASCO

CASE NUMBER: G.R. No. L-28050 DATE: March 13, 1928 PONENTE: VILLA-REAL, J Doctrine: The filing of a complaint by an agent against his principal for the collection of a balance in his favor resulting from the liquidation of the agency accounts between them, and his rendering of a final account of his operations, are equivalent to an express renunciation of the agency and terminates the juridical relation between them. FACTS:

This is an appeal taken by Federico Valera from the judgment of the Court of First Instance of Manila dismissing his complaint against Miguel Velasco, on the ground that he has not satisfactorily proven his right of action.

By virtue of the powers of attorney, Exhibits X and Z, executed by the plaintiff on April 11, 1919, and on August 8, 1922, the defendant was appointed attorney-in-fact of the said plaintiff with authority to manage his property in the Philippines, consisting of the usufruct of a real property located of Echague Street, City of Manila.

The defendant accepted both powers of attorney, managed plaintiff's property, reported his operations, and rendered accounts of his administration; and on March 31, 1923 presented exhibit F to plaintiff, which is the final account of his administration for said month, wherein it appears that there is a balance of P3,058.33 in favor of the plaintiff.

The liquidation of accounts revealed that the plaintiff owed the defendant P1,100, and as misunderstanding arose between them, the defendant brought suit against the plaintiff, civil case No. 23447 of this court. Judgment was rendered in his favor on March 28, 1923, and after the writ of execution was issued, the sheriff levied upon the plaintiff's right of usufruct, sold it at public auction and adjudicated it to the defendant in payment of all of his claim. o Subsequently, on May 11, 1923, the plaintiff sold his right of redemption to one Eduardo Hernandez, for

the sum of P200 (Exhibit A). On September 4, 1923, this purchaser conveyed the same right of redemption, for the sum of P200, to the plaintiff himself, Federico Valera (Exhibit C).

o After the plaintiff had recovered his right of redemption, one Salvador Vallejo, who had an execution upon a judgment against the plaintiff rendered in a civil case against the latter, levied upon said right of redemption, which was sold by the sheriff at public auction to Salvador Vallejo for P250 and was definitely adjudicated to him. Later, he transferred said right of redemption to the defendant Velasco. This is how the title to the right of usufruct to the aforementioned property later came to vest the said defendant.

ISSUE: Whether the lower court erred in holding that one of the ways of terminating an agency is by the express or tacit renunciation of the agent; and that the institution of a civil action and the execution of the judgment obtained by the agent against his principal is but renunciation of the powers conferred on the agent; RULING: The lower court did not err. The fact that an agent institutes an action against his principal for the recovery of the balance in

his favor resulting from the liquidation of the accounts between them arising from the agency, and renders a final account of his operations, is equivalent to an express renunciation of the agency, and terminates the juridical relation between them.

Article 1732 of the Civil Code reads as follows:

Art. 1732. Agency is terminated: 1. By revocation; 2. By the withdrawal of the agent; 3. By the death, interdiction, bankruptcy, or insolvency of the principal or of the agent.

And article 1736 of the same Code provides that: Art. 1736. An agent may withdraw from the agency by giving notice to the principal. Should the latter suffer any damage through the withdrawal, the agent must indemnify him therefore, unless the agent's reason for his withdrawal should be the impossibility of continuing to act as such without serious detriment to himself.

The misunderstanding between the plaintiff and the defendant over the payment of the balance of P1,000 due the latter, as a result of the liquidation of the accounts between them arising from the collections by virtue of the former's usufructuary right, who was the principal, made by the latter as his agent, and the fact that the said defendant brought suit against the said principal on March 28, 1928 for the payment of said balance, more than prove the breach of the juridical relation between them; for, although the agent has not expressly told his principal that he renounced the agency, yet neither dignity nor decorum permits the latter to continue representing a person who has adopted such an antagonistic attitude towards him.

When the agent filed a complaint against his principal for recovery of a sum of money arising from the liquidation of the accounts between them in connection with the agency, Federico Valera could not have understood otherwise than that Miguel Velasco renounced the agency; because his act was more expressive than words and could not have caused any doubt.

In order to terminate their relations by virtue of the agency the defendant, as agent, rendered his final account on March 31, 1923 to the plaintiff, as principal.

The defendant-appellee Miguel Velasco, in adopting a hostile attitude towards his principal, suing him for the collection of the balance in his favor, resulting from the liquidation of the agency accounts, ceased ipso facto to be the agent of the plaintiff-appellant, said agent's purchase of the aforesaid principal's right of usufruct at public auction held by virtue of an execution issued upon the judgment rendered in favor of the former and against the latter, is valid and legal.

The defendant-appellee, Miguel Velasco, having acquired Federico Valera's right of redemption from Salvador Vallejo, who had acquired it at public auction by virtue of a writ of execution issued upon the judgment obtained by the said Vallejo against the said Valera, the latter lost all right to said usufruct.

The disagreements between an agent and his principal with respect to the agency, and the filing of a civil action by the former against the latter for the collection of the balance in favor of the agent, resulting from a liquidation of the agency accounts, are facts showing a rupture of relations, and the complaint is equivalent to an express renunciation of the agency, and is more expressive than if the agent had merely said, "I renounce the agency."

73) CUI vs. CUI CASE NUMBER: L-7041 DATE: August 31, 1964

PONENTE: J. Makalintal

FACTS:

1. The Hospicio is a charitable institution established by the spouses Don Pedro Cui and Doa Benigna Cui, now deceased, "for the care and support, free of charge, of indigent invalids, and incapacitated and helpless persons." It was incorporated under Act No. 3239 of the Philippine Legislature in 1925 and endowed with extensive properties by the said spouses through a series of donations, principally the deed of donation executed in 1926.

2. Section 2 of Act No. 3239 gave the initial management to the founders jointly and, in case of their incapacity or death, to "such persons as they may nominate or designate, in the order prescribed to them."

3. Don Pedro Cui died in 1926, while his widow died in 1929. The administration passed to Mauricio Cui and Dionisio Jakosalem. The former died on 8 May 1931 and the latter on 1 July 1931.

4. On 2 July 1931 Dr. Teodoro Cui, only son of Mauricio Cui, became the administrator. Beginning 1932, a series of controversies and court litigations ensued concerning the position of administrator.

5. Plaintiff Jesus Ma. Cui and defendant Antonio Ma. Cui are brothers, being the sons of Mariano Cui, one of the nephews of the spouses Don Pedro Cui and Doa Benigna Cui. In 1960, the then incumbent administrator, Dr. Teodoro Cui, resigned in favor of Antonio Ma. Cui pursuant to a "convenio" entered into between them. On February 28, Antonio Ma. Cui took his oath of office. Jesus Ma. Cui, had no prior notice of either the "convenio" or of his brother's assumption of the position.

6. Dr. Teodoro Cui died on 27 August and the plaintiff wrote a letter to the defendant demanding that the office be turned over to him. The demand remained unheeded, the plaintiff filed the complaint. Romulo Cui later on intervened, claiming a right to the same office, being a grandson of Vicente Cui, one of the nephews mentioned by the founders of the Hospicio in their deed of donation.

7. As between Jesus and Antonio the main issue turns upon their respective qualifications to the position of administrator. Jesus is the older and under equal circumstances would be preferred pursuant to section 2 of the deed of donation. However, before the test of age may be, applied the deed gives preference to the one, among the legitimate descendants of the nephews named, "que posea titulo de abogado, o medico, o ingeniero civil, o farmaceutico, o a falta de estos titulos el que pague al estado mayor impuesto o contribucion."

8. What is being disputed is the meaning of the term "titulo de abogado." Jesus Ma. Cui holds the degree of Bachelor of Laws from the University of Santo Tomas (Class 1926) but is not a member of the Bar, not having passed the examinations. Antonio Ma. Cui is a member of the Bar and although disbarred by the Court but was reinstated by resolution about two weeks before he assumed the position of administrator of the Hospicio.

9. The Court a quo, decied in favor of the plaintiff and held that the phrase "titulo de abogado," taken alone, means that of a full-fledged lawyer, but that has used in the deed of donation and considering the function or purpose of the administrator, it should not be given a strict interpretation but a liberal one," and therefore means a law

degree or diploma of Bachelor of Laws. 10. Jesus Ma. Cui believed he was entitled to the office in as long ago as 1932. On January 26 of that year he filed a

complaint in quo warranto against Dr. Teodoro Cui, who assumed the administration of the Hospicio. Mariano Cui, the plaintiff's father and Antonio Ma. Cui came in as intervenors. The case was dismissed by the Court of First Instance upon a demurrer by the. Upon appeal to the Supreme Court from the order of dismissal, the case was remanded. The plaintiff, did not prosecute the case as decided by the Court, but entered into an arrangement whereby Teodoro Cui continued as administrator, Mariano Cui was named "legal adviser" and plaintiff Jesus Ma. Cui accepted a position as assistant administrator.

11. The plaintiff tried to get the position by a series of extra-judicial maneuvers. However, the Commissioner to the Secretary of Justice ruled that the plaintiff, not being a lawyer, was not entitled to the administration of the Hospicio.

12. Defendant Antonio Ma. Cui was reinstated by this Court as member of the Bar, and succeeded Dr. Teodoro Cui when he resigned as administrator pursuant to the "convenio" between them.

ISSUE & RULING: WON the administrator should only have possession of the academic degree of Bachelor of Laws. NO. The Court is of the opinion, that whether taken alone or in context the term "titulo de abogado" means not mere possession of the academic degree of Bachelor of Laws but membership in the Bar after due admission, qualifying one for the practice of law. In Spanish the word "titulo" is defined as "testimonies o instrumento dado para ejercer un empleo, dignidad o profesion" and the word "abogado," as follows: "Perito en el derecho positivo que se dedica a defender en juicio, por escrito o de palabra, los derechos o intereses de los litigantes, y tambien a dar dictmen sobre las cuestiones o puntos legales que se le consultan (Id., p.5) A Bachelor's degree alone, conferred by a law school upon completion of certain academic requirements, does not entitle its holder to exercise the legal profession. The English equivalent of "abogado" is lawyer or attorney-at-law. This term has a fixed and general signification, and has reference to that class of persons who are by license officers of the courts, empowered to appear, prosecute and defend, and upon whom peculiar duties, responsibilities and liabilities are devolved by law as a consequence. 2) WON Jesus Cui is disqualified as being an administrator. YES. He only has the academic degree of Bachelor of Laws. The founders of the Hospicio de San Jose de Barili provided in the deed of donation that if not a lawyer, the administrator should be a doctor or a civil engineer or a pharmacist, in that order; or failing all these, should be the one who pays the highest taxes among those otherwise qualified. A lawyer, first of all, because under Act No. 3239 the managers or trustees of the Hospicio shall "make regulations for the government of said institution (Sec. 3, b); shall "prescribe the conditions subject to which invalids and incapacitated and destitute persons may be admitted to the institute" (Sec. 3, d); shall see to it that the rules and conditions promulgated for admission are not in conflict with the provisions of the Act; and shall administer properties of considerable value for all of which work, it is to be presumed, a working knowledge of the law and a license to practice the profession would be a distinct asset. 3) WON Antonio Cui is entitled as administrator despite his past disbarment. YES. It is argued that although the latter (Antonio) is a member of the Bar he is nevertheless disqualified by virtue of paragraph 3 of the deed of donation, which provides that the administrator may be removed on the ground, among others, of ineptitude in the discharge of his office or lack of evident sound moral character. Reference is made to the fact that the defendant was disbarred by this Court in1957 for immorality and unprofessional conduct. It is also a fact, however, that he was reinstated in 1960, before he assumed the office of administrator. His reinstatement is a recognition of his moral rehabilitation, upon proof no less than that required for his admission to the Bar in the first place. As far as moral character is concerned, the standard required of one seeking reinstatement to the office of attorney cannot be less exacting than that implied in paragraph 3 of the deed of donation as a requisite for the office which is disputed in this case. When the defendant was restored to the roll of lawyers the restrictions and disabilities resulting from his previous disbarment were wiped out.

This action must fail on one other ground: it is already barred by lapse of time amounting the prescription or laches. Under Section 16 of Rule 66, this kind of action must be filed within one (1) year after the right of plaintiff to hold the office arose. 4) WON the action of the plaintiff for administrator has prescribed. YES. The failure of the plaintiff to prosecute his claim judicially after this Court decided the first case of Cui v. Cui in 1934 remanding it to the trial court for further proceedings; his acceptance instead of the position of assistant administrator, allowing Dr. Teodoro Cui to continue as administrator and his failure to file an action in quo warranto against said Dr. Cui after 31 July 1956, when the appeal in Civil Case No. R-1216 of the Cebu Court was dismissed upon motion of the parties precisely so that the conflicting claims of the parties could be ventilated in such an action all these circumstances militate against the plaintiff's present claim in view of the rule that an action in quo warranto must be filed within one year after the right of the plaintiff to hold the office arose. The excuse that the plaintiff did not file an action against Dr. Teodoro Cui after 31 July 1956 because of the latter's illness did not interrupt the running of the statutory period. And the fact that this action was filed within one year of the defendant's assumption of office in September 1960 does not make the plaintiff's position any better, for the basis of the action is his own right to the office and it is from the time such right arose that the one-year limitation must be counted, not from the date the incumbent began to discharge the duties of said office. 5) WON Romulo Cui is entitled as administrator. NO. Now for the claim of intervenor and appellant Romulo Cui. This party is also a lawyer, grandson of Vicente Cui, one of the nephews of the founders of the Hospicio mentioned by them in the deed of donation. He is further, in the line of succession, than defendant Antonio Ma. Cui, who is a son of Mariano Cui, another one of the said nephews. The deed of donation provides: "a la muerte o incapacidad de estos administradores (those appointed in the deed itself) pasara a una sola persona que sera el varon, mayor de edad, que descienda legitimamente de cualquiera de nuestros sobrinos legitimos Mariano Cui, Mauricio Cui, Vicente Cui, Victor Cui, y que posea titulo de abogado ... En igualdad de circumstancias, sera preferido el varon de mas edad descendiente de quien tenia ultimamente la administration." Besides being a nearer descendant than Romulo Cui, Antonio Ma. Cui is older than he and therefore is preferred when the circumstances are otherwise equal. The intervenor contends that the intention of the founders was to confer the administration by line and successively to the descendants of the nephews named in the deed, in the order they are named. Thus, he argues, since the last administrator was Dr. Teodoro Cui, who belonged to the Mauricio Cui line, the next administrator must come from the line of Vicente Cui, to whom the intervenor belongs. This interpretation, however, is not justified by the terms of the deed of donation. IN VIEW OF THE FOREGOING CONSIDERATIONS, the judgment appealed from is reversed and set aside, and the complaint as well as the complaint in intervention are dismissed, with costs equally against plaintiff-appellee and intervenor-appellant.

74) [PLUM] vs. COMPANIA MARITIMA


PONENTE: Bengzon, J.P

FACTS:

1. MARITIMA is a local corporation engaged in the shipping business. Teves is its branch manager in the port of Iligan City and AFWU is a duly registered legitimate labor organization with 225 members.

2. On August 11, 1952, MARITIMA, through Teves, entered into a CONTRACT with AFWU to do and perform all the work of stevedoring and arrastre services of all its vessels or boats calling in the port of Iligan City, beginning August 12, 1952.

3. During the first month of the existence of the CONTRACT, AFWU rendered satisfactory service. So, MARITIMA, through Teves, verbally renewed the same.

4. The harmonious relations between MARITIMA and AFWU lasted up to the latter part of 1953 when the former complained to the latter of unsatisfactory and inefficient service by the laborers doing the arrastre and stevedoring work. This deteriorating situation was admitted as a fact by AFWU's president.

5. To remedy the situation since MARITIMA's business was being adversely affected -Teves was forced to hire extra laborers from among "stand-by" workers not affiliated to any union to help in the stevedoring and arrastre work. The wages of these extra laborers were paid by MARITIMA through separate vouchers and not by AFWU. Moreover, said wages were not charged to the consignees or owners of the cargoes.

6. On July 23, 1954, AFWU presented to MARITIMA a written proposal for a collective bargaining agreement. This demand embodied certain terms and conditions of employment different from the provisions of the CONTRACT. No reply was made by MARITIMA.

7. AFWU sued MARITIMA for unfair labor practice saying that MARITIMA refused to bargain collectively. CIR dismissed the case on the ground that it has no jurisdiction over the case.

ISSUES:

1. Whether or not Maritima is can be considered an employer of the members of AFWU? NO. 2. Whether or not AFWU is an agent of Maritima? NO.

RULING:

1. There is no any direct employment relationship between MARITIMA and the laborers. The latter have no separate individual contracts with MARITIMA. In fact, the court a quo found that it was AFWU that hired them. Their only possible connection with MARITIMA is through AFWU which contracted with the latter. Hence, they could not

possibly be in a better class than AFWU which dealt with MARITIMA.

a. Under the CONTRACT, AFWU was an independent contractor of MARITIMA.

i. The petitioner union operated as a labor contractor under the so-called "cabo" system has a complete set of officers and office personnel and its organizational structure.

ii. The payrolls where laborers are listed and paid were prepared by the union itself without the intervention or control of the respondent company and/or its agent at. The respondent never had any knowledge of the individual names of laborers and/or workers listed in the union payroll or in their roster of membership.

iii. The union engaged the services of their members in undertaking the work of arrastre and

stevedoring geither to haul shippers' goods from their warehouses to the MARITIMA boat or from the boat to the different consignees. The charges for such service were known by the union and collected by them through their bill collector, who are employees of the union and not of the respondent. The respondent had no intervention whatsoever in the collection of those charges.

iv. The union members who were hired by the union to perform arrastre and stevedoring work on respondents' vessels at Iligan port were being supervised and controlled by the general foreman of the petitioner union or by any union assistant when performing arrastre and/or stevedoring work aboard vessels of the Compaia MARITIMA. There were no instances where offices and employees of the respondent Compaia MARITIMA and/or its agent had interferred in the giving of instructions to the laborers performing the arrastre and/or stevedoring work.

b. It is true that MARITIMA admits that it did not answer AFWU's proposal for a collective bargaining agreement. From this it does not necessarily follow that it is guilty of unfair labor practice. Under the law the duty to bargain collectively arises only between the "employer" and its "employees". Where neither party is an ''employer" nor an "employee" of the other, no such duty would exist. Needless to add, where there is no duty to bargain collectively the refusal to bargain violates no right.

c. The facts as found by the court a quo strongly indicate that it is AFWU itself who is the "employer" of those laborers. The facts very succinctly show that it was AFWU, through its officers, which (1) selected and hired the laborers, (2) paid their wages, (3) exercised control and supervision over them, and (4) had the power to discipline and dismiss them. These are the very elements constituting an employer-employee relationship.

2. An agent can not represent two conflicting interests that are diametrically opposed. And that the cases sought to be

relied upon did not involve representatives of opposing interests.

75) FAR EASTERN EXPORT & IMPORT CO, vs. LIM TECK SUAN CASE NUMBER: L-7144 DATE: May 31, 1955

PONENTE: Montemayor, J.

FACTS:

Ignacio Delizalde, an agent of the Far Eastern Export & Import Company, went to the store of Lim Teck Suan in Manila and offered to sell textile.

Having arrived at an agreement with Bernardo Lim, General Manager of Lim Teck Suan, Delizalde returned with a buyers order.

Suan established a letter of credit in favour of Frenkel International Corporation through HSBC.

The textile arrived and was received by Suan, but complained to Far Eastern of the inferior quality of the textile.

Upon the instruction of Far Eastern, Suan deposited the goods in a warehouse and withdrew the same and was offered for sale. The net direct loss is now being claimed against Far Eastern.

The defense set up is that Far Eastern only acted as a broker in this transaction.

The lower court acquitted Far Eastern.

CA reversed the judgment, basing its decision of reversal on the case of Jose Velasco v. Universal Trading where the transaction therein involved was found by the court to be one of purchase and sale and not of brokerage or agency.

ISSUE: Was the transaction one of agency that will exonerate Far Eastern from liability, or one of purchase

and sale? RULING: One of purchase and sale

SC agreed with the CA that the facts in this case are very similar to those in the Velasco case. o In the Velasco case, Universal Trading contends

that it merely acted as agent for Velasco and could not be held responsible for the substitution of Blended Whisky for Bourbon Whisky.

o The Court held that the transaction was purchase and sale and ordered the defendant to refund his deposit with legal interest.

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. o He could not serve two masters at the same

time. o Far Eastern, being an agent of Frenkel, could

not have acted as an agent or broker for Suan.

The transaction entered into by Far Eastern with Suan is one of purchase and sale. o Far Eastern acted as agent for Frenkel

International Corporation, presumably the supplier of the textile sold.

o Suan according to the first part of the agreement is said merely to be commissioning Far Eastern to procure for him the merchandise in question.

o The price of the merchandise bought was paid for by Suan by means of an irrevocable letter of credit opened in favour of the supplier, Frenkel International Corporation.

o The agreement speaks of the items involved as sold, and the sale was even confirmed by Far Eastern.

o Far Eastern dealt directly with Suan without expressly indicating or revealing the principal.

o There was no privity of contract between the buyer and supplier.

o No commission or monetary consideration was paid or agreed to be paid by the buyer to export company 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 buyer and the net or special price quoted to the seller by the supplier.

76) NIELSON & CO., INC. vs LEPANTO CONSOLIDATED MINING CO. CASE NUMBER: L-21601 DATE: December 28, 1968

PONENTE: Zaldivar, J.

FACTS:

Nielson & Company, Inc. and Lepanto Consolidated Mining Company entered into a management contract. o Nielson had agreed, for a period of five years, with the right to renew for a like period, to explore, develop

and operate the mining claims of Lepanto, and to mine, or mine and mill, such pay ore as may be found and to market the metallic products recovered therefrom which may prove to be marketable, as well as to render for Lepanto other services specified in the contract.

o Nielson was to take complete charge, subject at all times to the general control of the Board of Directors of Lepanto, of the exploration and development of the mining claims, of the hiring of a sufficient and competent staff and of sufficient and capable laborers, of the prospecting and development of the mine, of the erection and operation of the mill, and of the benefication and marketing of the minerals found on the mining properties.

o Nielson was also to act as purchasing agent of supplies, equipment and other necessary purchases by Lepanto, but no purchase shall be made without the prior approval of Lepanto and no commission shall be claimed or retained by Nielson on such purchase.

o 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.

o In the performance of this principal undertaking, Nielson was not in any way executing juridical acts for Lepanto.

Lepanto terminated the contract in 1945, 2 years before its expiration, when it took over and assumed exclusive management of the work previously entrusted to Nielson under the contract.

Lepanto finally maintains that Nielson as an agent is not entitled to damages since the law gives to the principal the right to terminate the agency at will.

ISSUE: Was the management contract entered into by and between Nielson and Lepanto a contract of agency such that it has the right to revoke and terminate the contract at will, or a contract of lease of services?

RULING: Contract of Lease of Services

The management contract was one of contract of lease of services and not a contract of agency.

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:

o The basis of agency is representation, while in the lease of work or services, the basis is employment.

77) SHELL COMPANY OF THE PHILS., LTD. vs.


PONENTE: Padilla, J.

FACTS:

1. A Plymounth car, owned by Salvador Sison, was brought by his son, Perlito Sison to the Shell Gasoline and Service Station in Manila for washing, greasing and spraying.

2. The operator of the station agreed to do service upon payment of P 8.00

3. The car was placed on a hydraulic lifter under the direction of the personnel of the station.

4. According to the testimony of son Perlito, the car was raised up to 6 feet high. After it was washed and greased, the grease men cannot reach the ungreased portion underneath the vehicle so they loosen the lifter a few feet lower. Because of this, the car swayed and for a few second, it fell.

5. This was immediately reported to the Manila Adjustor Company, the adjustor of respondent insurance companies.

6. As inspected by Mr. Baylon, the damaged car was taken to the repair shop and it was restored to running condition after repairs amounting to P 1,651.38.

7. Because the insurance companies paid for the damages, respondent Salvador Sison made assignments of his rights to recover damages in favor of the respondent-insurance companies.

8. However, according to the counter-statement of facts by defendant Porfirio de la Fuente, the operator of Shell gasoline Manila, the ff tasks were done by the ff people: Job of washing and greasing defendant

Porfirio de la Fuente through his two employees:

o Alfonso Adriano grease man o De los Ryees helper and washer

Respondent de la Fuente denied negligence in the operation of the lifter

9. The insures and the owner of the car brought an action against petitioner Shell Company and de la Fuente to recover the sum of P 1, 651. 38 from them jointly and severally.

10. Decision of CFI: Dismissed complaint 11. Decision of CA: reversed decision of CFI; Shell must

pay insurance companies the amount P 1,651. 38 with legal interest.

The car fell as a result of the jerking and swaying of the lift when the valve was released and that the jerking was due to some accident and unforeseen shortcoming of the mechanism itself.

Reasoning of CA: De la Fuente is NOT an independent contractor BUT an AGENT of petitioner Shell

o Respondent de la Fuente, the operator of the

gasoline and service station was the AGENT of the petitioner Shell Company of the Philippines, Ltd.

o Facts which show that de la Fuente is a mere agent: The operator, de la Fuente, owned his position to

the company and the company could remove him or terminate his services at will

The service station belonged to the company and bore its trade name and the operator sold only the products of the company

The equipment used by the operator belonged to the company and were just loaned to the operator and the company took charge of their remain and maintenance

An employee of the company supervised the operator and conducted periodic inspection of the companys gasoline and service station, etc.

ISSUE: WON petitioner Shell should be liable for the acts of an agent or his employee acting within the scope of his authority?

RULING: YES. The breach of the undertaking by the agent

(defendant de la Fuente) is one for which the principal

(Shell) is answerable. Decision: Judgment under review is

AFFIRMED. Costs against petitioner

1. Rule: 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.

2. The petitioner-company undertook to "answer and see to it that the equipments are in good running order and usable condition;"

3. Also, the CA found that the Company's mechanic failed to make a thorough check up of the hydraulic lifter and the check up made by its mechanic was "merely routine" by raising "the lifter once or twice and after observing that the operator was satisfactory, he (the mechanic) left the place."

4. The latter was negligent and the company must answer for the negligent act of its mechanic which was the cause of the fall of the car from the hydraulic lifter.

78) SEVILLA VS. COURT OF APPEALS

CASE NUMBER: L-41182-3 DATE: APRIL 15, 1988

PONENTE: SARMIENTO, J.

FACTS:

1. Mrs. Segundina Noguera leased her premises located at Ermita, Manila to Tourist World Service, Inc. (TWSI), represented by Eliseo Canilao, for the latters use as branch office.

2. In the said contract Mrs. Lina Sevilla held herself solidarily liable with TWSI for the prompt payment of the monthly rental agreed on.

3. When the branch office was opened, the same was run by petitioner Mrs. Sevilla, who was designated as branch manager by TWSI. For any fare bought in on the efforts of Mrs. Sevilla,, 4% was to go her and 3% was to be withheld by TWSI

4. In November 1961, TWSI was allegedly informed that Mrs. Sevilla was connected with a rival travel firm. Since the branch office was losing, TWSI considered closing it down. The firms board of directors issued two resolutions; the first abolishing the office of manager of the Ermita Branch Office and the second, authorizing the corporate secretary to receive the property of TWSI in said branch

5. In January 1962, the lease contract to use the premises as branch office was terminated. In June 1962, the Corporate Secretary went over to the office to comply with the mandate of the resolutions. Finding the premises locked and unable to contact Mrs. Sevilla, he padlocked the premises to protect the interests of TWSI

6. As such, petitioners Spouses Sevilla filed a complaint against respondents TWSI, Canilao and Noguera, praying for mandatory preliminary injunction. Petitioners claim that Mrs. Sevillas relationship with TWSI was one of joint business venture and notone of employment.

7. In its answer, TWSI contend that Mrs. Sevilla was its employee and as such was designated manager. 8. The trial court held for the private respondents. It ruled that TWSI, being the true lessee, has the privilege to terminate

the lease and padlock the premises. It also held that Mrs. Sevilla was a mere employee of TWSI and that she was bound by the act of her employer.

9. The Court of Appeals affirmed said decision, Hence, the instant petition. ISSUE: WON there is a contract of agency between respondent-principal TWSI and petitioner Sevilla? If yes, should

principal TWSI be liable for damages for its unwarranted revocation of the contract of agency? YES for both.

Decision: Decision of CA is REVERSED and SET ASIDE. Costs against respondent TWSI RULING: 1. This case involves a contract of Agency. There is neither joint venture between nor partnership TWSI and Mrs. Sevilla The relationship of said parties is one that of a principal and an agent. Case at bar:

o Petitioner Sevilla agreed to man the Ermita office of respondent TWSI based on a contract of agency. o It is the essence of this contract that the agent renders services in representation or on behalf of another o Sevilla solicited airline fares but she did so for and on behalf of her principal TWSI. As compensation, she received

4% of the proceeds in the concept of commissions. Sevilla pre-assumed her principals authority as owner of the business undertaking. Considering the facts, this case involves a principal-agent relationship rather than a joint management or partnership.

o But unlike simple grants of a power of attorney, the agency that the Court here by declares to be compatible with the intent of the parties cannot be revoked at will.

o The reason is that it is an agency coupled with an interest, the agency having been created for mutual interest of the agent and the principal.

o In this case, the agency cannot be revoked at the pleasure of the principal. This unwarranted revocation of the contract of agency entitles petitioner Sevilla to damages Respondent TWIS is liable for P 25,000 moral damages, P 10,000 exemplary damages, P 5,000 nominal

damages and/or temperate damages.

Other issues:

2. No Employer-Employee Relationship between TWSI and Mrs. Sevilla. There has been no uniform test to determine the existence of an employer-employee relation. In general, The Court has relied in the so-called control test, where the person for whom the services are performed

reserves a right to control not only the end to be achieve Case at bar:

o 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 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.

o Also, when the branch office was opened, the same was run by Mrs. Sevilla payable to TWSI. It cannot be said that she was under the control of TWSI as to the means used. She obviously relied on her own capabilities

o Sevilla was also not in the companys payroll. She retained commissions based on her booking successes and its not based on a fixed salary

A true employee cannot be made to part with his own money in pursuance of his employers business, or otherwise, assume any liability thereof. In that event, the parties must be bound by some other relation, but certainly not employment.

79) LIM vs. PEOPLE

CASE NUMBER: G.R. No. L-34338 DATE: November 21, 1984

PONENTE: RELOVA, J

FACTS:

1. Lourdes Lim went to the house of Maria de Guzman and proposed to sell the latters tobacco. 2. Maria agreed with the proposalhence the execution of a receipt manifesting that Lourdes received 615 kilos of

tobacco to be sold at P1.30 per kilo, the overprice for which would be received by Lourdes. 3. The receipt also states that the proceeds will be given to Mariaas soon as it was sold. 4. However, Lourdes paid only P240, despite repeated demands. 5. Thus, Maria filed a complaint, and Lourdes was found guilty of estafa. (Estafa is present where contract to sell

constituted another as mere agent) 6. Lourdes argued that the receipt was a contract of sale and not a contract of agency to sell.

ISSUE: Is Lourdes argument tenable?

RULING: NO.

The contract was not a contract of sale because there was no transfer of ownership of the goods to Lourdes. Instead, the agreement was a contract of agency to sell for it constituted Lourdes as agent with the obligation to give the proceeds of the sale to Maria as soon as the same was sold. The obligation was immediately demandable as soon as the tobacco was disposed of. Consequently, there is no need for the court to fix the duration of the obligation, as contended by Lourdes.

80) SAN DIEGO, SR. vs. NOMBRE CASE NUMBER: G.R. No. L-19265 DATE: May 29, 1964

PONENTE: PAREDES, J.:

FACTS:

1. While being the judicial administrator of the intestate estate subject of Special Proceeding 7279, AdeloNombre leased one of the properties (fishpond) of the said estate to Pedro Escanlar for 3 years without approval of the court.

2. When Nombre was removed as judicial administrator, he was substituted by SofronioCampillanos. Campillanos filed a motion asking for authority to execute a lease contract of the same fishpond in favour of Moises San Diego.This motion was granted on the ground that the contract of lease entered into between Nombre and Escanlar was void for want of judicial authority.

3. Nombre and Escanlar appealed this order to the Court of Appeals, which reversed the same order. 4. Aggrieved, San Diego appealed to the Supreme Court.

ISSUE: San Diego raised the following legal questions:

1. Whether a judicial administrator can validly lease property of the estate without prior judicial authority and approval, and

2. Whether the provisions of the New Civil Code on Agency (referring specifically to par. 8 of Article 1878) should apply to judicial administrators.

RULING:

Administrator has the power of administering the estate of the deceased person. He may, therefore, exercise all acts of administration without special authority of the court. For instance, he may lease the property without prior approval from

the court, since leasing has been considered an act of administration. Par. 8 of Article 1878 states that Special powers of attorney are necessary to lease any real property to

another person for more than one (1) year.This provision, according to San Diego, is a limitation to the right of a judicial administrator to lease real property without prior judicial authority if it exceeds one (1) year. However, the same argument falls becauseprovisions on Agency do not apply to judicial administrators.

A judicial administrator is appointed by the court. He is not only the representative of the court, but also the heirs and creditors of the estate. Before conducting his duties, he is required to file a bond. His actions are subject to specific provisions of law and orders of the appointing court. These circumstances are not true in case of agency.

81) DELA PENA VS. HIDALGO

CASE NUMBER: G.R. No. L-5486 DATE: August 17, 1910

PONENTE: TORRES, J.

FACTS:

1. Before Jose de la Pea y Gomiz embarked for Spain, on November 12, 1887, he executed a power of attorney in favor of Federico Hidalgo, Antonio L. Rocha, Francisco Roxas and Isidro Llado, so that, as his agents, they might represent him and administer various properties he owned and possessed in Manila.

2. After Federico Hidalgo had occupied the position of agent and administrator of De la Pea's property, he wrote to the latter requesting him to designate a person who might substitute him in his said position in the event of his being obliged to absent himself from the country.

one of those appointed in the said power of attorney had died and the others did not wish to take charge of the administration of their principal's property.

3. Hidalgo stated that Pea y Gomiz, did not even answer his letters, to approve or object to the former's accounts, and did not appoint or designate another person who might substitute him.

4. For reasons of health and by order of his physician, Federico Hidalgo was obliged to embark for Spain, and, on preparing for his departure, he rendered the accounts of his administration by letter of the date of March 22, 1894, addressed to his principal, Pea y Gomiz.

5. In this letter the defendant informed the dela Pena of the his intended departure from this country and of his having provisionally turned over the administration of the said property to his cousin, Antonio Hidalgo, upon whom he had conferred a general power of attorney.He added thatin case that this was not sufficient, that Pea send to Antonio Hidalgo a new power of attorney.

6. TC concluded that despite the denial, the was sent to, and was received by Jose de la Pea y Gomiz, during his lifetime and that the constituent he was informed of the departure of his agent of the latter's having turned over the

administration of the property to Antonio Hidalgo, and of his agent's the defendant's petition that he send a new power of attorney to the substitute.

ISSUE:

(1) WON Federico had renounced his agency (2) WON Federico can be held liable with the wrongful administration of the subsequent agents

RULING:

1. YES

Federico had definitely renounced his agency was duly terminated, according to the provisions of article 1732 of the Civil Code, because, althoughthe word "renounce" was not employed in connection with the agency or power of attorney executed in his favor, yet when the agent informs his principal that for reasons of health and by medical advice he is about to depart from the place where he is exercising his trust and where the property subject to his administration is situated, abandons the property, turns it over a third party, without stating when he may return to take charge of the administration, renders accounts of its revenues up to a certain date, December 31, 1893, and transmits to his principal a general statement which summarizes and embraces all the balances of his accounts since he began to exercise his agency to the date when he ceased to hold his trust, and asks that a power of attorney in due form in due form be executed and transmitted to another person who substituted him and took charge of the administration of the principal's property, it is then reasonable and just to conclude that the said agent expressly and definitely renounced his agency, and it may not be alleged that the designation of Antonio Hidalgo to take charge of the said administration was that of a mere proceed lasted for more than fifteen years, for such an allegation would be in conflict with the nature of the agency.

In permitting Antonio Hidalgo to administer his property in this city during such a number of years, it is inferredthatthe deceased consented to ha

agency written digest

Documents

favor of orient air

air carrier

event orient air services

american air instituted

air cargo transportation

termination american

trial court

american airlines