‘THE LAW ON AGENCY 1. Eastside Academy engages the services of Mrs. Gregoria Dulay, a mathematics teacher, to teach math subjects in senior high school. In the middle of the term, Mrs. Dulay is called to the US by her daughter who is scheduled to undergo brain surgery. Unwilling to disadvantage her students by reason of her absence, Mrs. Dulay asks Mr. Diego, an equally qualified math teacher, to take her classes in her stead during the period of her absence. She promises him the pay she is to receive for the period he teaches. When he takes over her classes, is Mr. Diego acting as agent of Mrs. Dulay? No. Actually, Diego was performing a service for Mrs. Dulay. The essence of a contract of agency is the service be done in representation of another, with the other’s authority. Here, Diego was not representing Dulay. He was teaching in place of Dulay not in representation of Dulay. Dulay did not hire Diego to extend, as it were, her personality in her absence, but to teach her students as a distinct math teacher, though a substitute. 2. Miraminda and Clotilda are the only daughters of Gerturde, a widow. Gertrude dies leaving her daughters 7 hectares of farmland. Emman finds the site ideal and offers to buy the entire property. He transacts with Clotilda who accepts his offer of PHP 2.5 million. Does the sale bind Miraminda as well? No, it does not. Co-owners are not agents of each other, and the transaction that Clotilda entered into with Emman does not bind Miraminda. Clotilda is entitled to alienate only one-half of an interest in the farmland. 3. Aside from depleting all his bank accounts and incurring several debts that he is unable to pay, George has sold all of his property and staying in a room in his friend's house. One day, learning of an auction sale for imported cars, George decides to join the auction, but asks Esther to represent him at the auction and also to loan him the money he needs to make the auction purchase. Offering highest bid, Esther wins the second car on the auction block. She signs the Deed of Sale in George’s behalf and pays the price. Later on, Greg, the owner of the car sold at auction, discovers that George was insolvent at the time of the sale. Can anything be done about the sale? George did not have the capacity to enter into a contract of agency with Esther, being insolvent. As a result, the contract of sale at auction is voidable and subject to annulment, but Greg may not be the property party to sue for the annulment of the auction sale. On the other hand, if it were Esther who was incapacitated, then it would be the contract of agency itself that would be voidable, although the purchase at auction would be perfectly valid. 4. Miriam resides in the US but remains a Filipino citizen. Hearing that a neighbor in Bagumbayan is selling what Miriam considers to be prime property, she constitutes her neighbor, Ted, as her attorney-in-fact for purposes of bargaining for the property and acquiring it. She communicates with Tev via email and makes clear that she is willing to pay no morethan PHP 300,000.00. She promises Ted PHP 30,000 for his services. Despite Ted’s earnest attempts at bargaining, the seller is intransigent and demands PHP 750,000.00. Nothing comes out of the negotiations. 1s Ted entitled to PHP 30,000? Miriam constituted Ted her agent bargain for the purchase of the property. Not all bargains succeed, and therefore Miriam was aware of the chance of failure. The promised amount was consideration for Ted’s service of representing Miriam, to which he is entitled regardless of the unsuccessful negotiation. 5. Under standard contract terms of Gulf States Insurance Corp. its agents are engaged by the Corporation for a period of ten months. Each is to receive a 5% commission for each successful transaction. Roger was assigned by Gulf States to negotiate with the owners of huge malls in the Philippines. While he succeeded in securing contracts of insurance for four of the ten malls, four other malls approached by Roger and repeatedly cajoled by him to be insured, finally purchase insurance a month after Roger’s ten-month contract with Gulf States ends, each mall paying a premium of PHP 1.7 million. Is Roger entitled to the commission? Yes, he is. The doctrine of efficient procuring cause entitles him to his commission even after expiry of the contract of agency. It was because of his effort as agent that the four malls purchase insurance. Roger is therefore the efficient procuring cause of the purchase of insurance and as such is entitled to his commission.