Compiled Agency Digests Part3

AGENCY DIANE DESIERTO MOLINA VS PACIFIC PLANS INC. G.R. No. 165476 CALLEJO, J: March 10, 2006 NATURE Petition for Review on Certiorari FACTS - This is a landmark labor case. - Agripino V. Molina was employed by Pacific Plans Inc., as Regional Manager, Molina performed both administrative and marketing functions, whose duties and responsibilities included selling pre-need plans. - Caritas Health Shield, Inc. (Caritas for brevity), a health maintenance organization (HMO) engaged in selling health and hospitalization plans, it hired Molina as Assistant Vice President. - It was averred that PPI suffered a decline in sales. And petitioner points to Molina’s recruitment of his sales force for Caritas as the cause. PPI tried to terminate Molina on this ground while simultaneously alleging that Molina came to work drunk, misappropriated funds at Barrio Fiesta. Underlying these assertions is the allegation that PPI is in competition with Caritas. - The Labor Arbiter held for PPI while the NLRC and the CA reversed, thus this petition. ISSUE WON there is conflict of interest between Caritas and PPI HELD No. “The truth of the matter is that, as averred by Caritas President Geoffrey Martinez, Caritas is engaged in health care and hospitalization package, whereas respondent sells educational, pension, and pre-need plans. Caritas is an HMO and is directly supervised by the DOH, while respondent is under the supervision of the SEC. The so-called sales associates of the respondent are non-salaried employees and are paid on commission basis only. Their commissions are based on their individual initiative and industry. That the contracts executed by the beneficiaries of both corporations have similar provisions regarding contract price, grace period, cancellation, reinstatement, transfer and termination, do not constitute proof that Caritas and respondent are business competitors. There is also no proof that the two corporations compete with each other in the same or similar business; in fact, the business of Caritas and that of the respondent complement each other.”

WOODCHILD HOLDINGS V ROXAS ELECTRIC AND CONSTRUCTION CO. G.R. 140667 CALLEJO; AUGUST 12, 2004 NATURE

A2010 Petition for review on certiorari FACTS - Roxas Electric and Construction Company, Inc. (RECCI) was the owner of two parcels of land, one of which was a dirt road accessing to the Sumulong Highway, Antipolo, Rizal. - At a special meeting, its Board of Directors approved a resolution authorizing the corporation, through its president, Roberto B. Roxas, to sell Lot #1 at a price and under such terms and conditions which he deemed most reasonable and advantageous to the corporation; and to execute, sign and deliver the pertinent sales documents and receive the proceeds of the sale for and on behalf of the company. - Petitioner Woodchild Holdings, Inc. (WHI) wanted to buy Lot #1 on which it planned to construct a warehouse building, and a portion of the adjoining lot (Lot #2), so that its 45-foot container van would be able to readily enter or leave the property. - In a Letter to Roxas, WHI President Jonathan Y. Dy offered to buy Lot #1 under stated terms and conditions, one of which was that in the event that the right of way is insufficient for the buyer's purposes (example: entry of its 45-foot container), seller agrees to sell addtl portion from his current adjacent property to allow the buyer to full access and full use of it. - Roxas indicated his acceptance of the offer. A Deed of Absolute Sale was issued and the property was sold for P5M. - Dy and Roxas discussed the need of the WHI to buy a certain portion for the right of way. However, Roxas died soon thereafter. WHI wrote the RECCI, reiterating its verbal requests and complained about the failure to eject the squatters within the three-month period agreed upon. RECCI rejected the demand of WHI. - WHI filed a complaint against the RECCI with the RTC of Makati, for specific performance and damages. - RECCI then alleged that it never authorized its former president, Roberto Roxas, to grant the beneficial use of any portion of the other lot, nor agreed to sell any portion thereof or create a lien or burden thereon. Grant of a right of way and the agreement to sell a portion of it are ultra vires. - RTC rendered judgment in favor of the WHI. It ruled that the RECCI was estopped from disowning the apparent authority of Roxas, to do so would prejudice the WHI which transacted with Roxas in good faith. - CA reversed the RTC. Roxas was merely authorized to sell Lot #1, but not to grant right of way in favor of the WHI over a portion of the other. WHI cannot enforce its right to buy a portion of the said property since there was no agreement in the deed of absolute sale on the price thereof as well as the specific portion and area to be purchased. ISSUE WON RECCI is bound by the provisions in the deed of absolute sale granting to WHI beneficial use and a right of way over a portion of the lot and granting the option to the petitioner to buy a portion thereof HELD NO Ratio A corporation is a juridical person separate and distinct from its stockholders or members. Accordingly, the property of the corporation is not the property of its stockholders or members and may not be sold by the

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PROF. stockholders or members without express authorization from the corporation's board of directors. - Generally, the acts of the corporate officers within the scope of their authority are binding on the corporation. However, under Art 1910 of the New Civil Code, acts done by such officers beyond the scope of their authority cannot bind the corporation unless it has ratified such acts expressly or tacitly, or is estopped from denying them. BA Finance Corporation v. CA: Persons dealing with an assumed agency, whether the assumed agency be a general or special one, are bound at their peril, if they would hold the principal liable, to ascertain not only the fact of agency but also the nature and extent of authority, and in case either is controverted, the burden of proof is upon them to establish it. Reasoning Such authority to sell portions of other lot cannot be implied from the authority granted to Roxas to sell the Lot "on such terms and conditions which he deems most reasonable and advantageous." Under par 12, Art 1878 of the New Civil Code, a special power of attorney is required to convey real rights over immovable property. WHI cannot feign ignorance of the need for Roxas to have been specifically authorized in writing by the Board of Directors to be able to validly grant a right of way and agree to sell a portion of Lot #2. * BUT RECCI is liable to WHI for damages due to the delay in the construction of the warehouse. It did not fulfill its obligation, as stipulated in the Deed of Sale, to cause the eviction of the squatters before a certain date. It is also liable for the unearned income WHI should have been entitled to arising from lease rentals. Disposition CA decision affirmed WITH MODIFICATION. Roxas Electric is ordered to pay to the petitioner the amount of P5,612,980 by way of actual damages and P100,000 by way of attorney's fees.

MANILA REMNANT CO., INC. V. CA (VENTANILLA) 191 SCRA 622 C. J. FERNAN; November 22, 1990 NATURE Petition to review the decision of the Court of Appeals FACTS - UP faculty members, the spouses Oscar and Carmen Ventanilla bought land in the Capital Homes Subdivision through Artemio U. Valencia in March 1970, paid the downpayment and monthly installments thereof. - Manila Remnant Co., Inc. owned the parcels of land which it agreed that A.U. Valencia and Co., Inc. was to develop the subdivision and manage the sales thereof. Valencia was the president of both companies. - However, Valencia 1. Deposited in his own account the downpayment paid by the Ventanilla couple 2. re-sold the property to Carlos Crisostomo without consideration, and gave the monthly remittances of the couple as payments of Crisostomo. Therefore the couple was informed later on that they don’t have a valid claim to title because they’re not in the records of both firms. - The RTC affirmed by CA held that Valencia & Manila Remnant should be solidarily liable to pay the damages.

AGENCY DIANE DESIERTO ISSUE/S WON Manila Remnant should be held solidarily liable with Valencia, considering he was the only one who acted with fraud, without the authority to do those illegal acts from Manila Remnant HELD YES Ratio: First: the presidency of Valencia of both companies is equivalent to knowledge or constructive notice to Manila Remnant, and their failure to do anything to correct such an irregularity was deemed to have ratified the same. Second: Authority by Estoppel Article 1191 NCC: “Even when the agent has exceeded his authority, the principal is still solidarily liable with the agent if the former allowed the latter to act as though he had full powers.”

a.) b.) c.)

Carte blanche1 authority was given to Valencia Manila Remnant was Negligent, in failing to properly supervise and control the affairs of its agent and to adopt the needed measures to prevent further misrepresentation. Failure to act swiftly which prejudiced 3rd parties – the cited article 1191 is new, intended to protect the rights of innocent persons, the principal and the agent may be considered as joint tortfeasors.

Reasoning: Actually even without Article 1191, the mere fact that in Article 1897 of the New Civil Code: “… the agent who acts as such is not personally liable to that party with whom he contracts unless he expressly binds himself or exceeds the limits of his authority without giving such party sufficient notice of his powers.” The principal is liable, Manila Remnant cannot escape its liability. Disposition: CA affirmed

VALERA V VELASCO GR NO. L-28050 VILLA-REAL; March 13, 1928 FACTS -Velasco was appointed by Valera as Atty-in-fact by virtue of powers-ofattorney, with the authority to manage his property in the Philippines consisting of the usufruct of a real property located in Manila. -in his final account of his administration for March of 1923, it was reflected that there was a balance of P3058.33 in favor of Valera. Liquidation of accounts showed that plaintiff owed defendant P1100 and after a misunderstanding, defendant Velasco sued Valera in which he won. 1

Carte Blanche- white or black card; unlimited authorization; free hand. (Ulep, Latin Words and Phrases for Lawyers and Students)

A2010 -after a writ of execution, sheriff levied upon plaintiffs right of usufruct , sold it in public auction and gave proceeds to Velasco -plaintiff had a right of redemption, but one Salvador Vallejo, who execution upon a judgment against the plaintiff rendered in a civil case against the latter, levied upon the right of redemption, and through public auction, right was adjudicated to Vallejo. Later, he transferred said right to Velasco. Thus Velasco attained title to the right of usufruct over said property. *i think Valera’s contention was that as his Atty-in-fact, Velasco was his agent and therefore Velasco’s acquisition of plaintiff’s property was invalid. ISSUE WON Velasco was still Valera’s agent when he acquired the usufruct of the property HELD NO. -Plaintiff claims that the lower court erred in stating that one of the ways of terminating an agency is by express or tacit renunciation of the agent. -ART.1732 of the CC states that an agency is terminated by revocation; by withdrawal of the agent; by death, interdiction, bankruptcy or insolvency of the principal or agent. -ART.1736 of CC- 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. -Due to the misunderstanding between the two parties (as principal and agent), and the fact that the said defendant brought suit against the said principal, more than prove 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 had adopted such an antagonistic attitude toward him. When the agent filed a complaint against the principal for the recovery of a sum of money, Valera could not have understood otherwise than that Velasco renounced the agency because his act was more expressive than words and could not have caused any doubt.

DELA RAMA V TAN 99 PHIL 1034 UNREPORTED Special civil action of certiorari to annul 2 orders of respondent judge allowing respondent National Development Company to continue with public bidding set for Jan., 1955, for the sale of or operation and management of 3 oceangoing evssels belonging to respondent and named Dona Nat, DOna Alicia, DOnia Aurora. Petitioner contends that cancellation of the operation agreement by the respondent also is null and void in view of provisions of CC A1141. From whatever angle both sides of controversy are viweed, the cancellation of the management contract is the only remedy of respondent company consistent with it public character. Petition denied.

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