Eurotech Industrial Technologies, Inc. v.

Edwin Cuizon and Erwin Cuizon

G.R. No. 167552 April 23, 2007

FACTS:
Eurotech is engaged in the business of importation and distribution of various
European industrial equipment. It has as one of its customers Impact Systems Sales
which is a sole proprietorship owned by Erwin Cuizon. Petitioner sold to Impact
Systems various products allegedly amounting to P91,338.00. Cuizons sought to buy
from Eurotech 1 unit of sludge pump valued at P250,000.00 with Cuizons making
adown payment of P50,000.00. When the sludge pump arrived from the United
Kingdom, Eurotechrefused to deliver the same to Cuizons without their having fully
settled their indebtedness toEurotech. Thus, Edwin Cuizon and Alberto de Jesus,
general manager of Eurotech, executed a Deedof Assignment of receivables in favor of
Eurotech.

Respondents, despite the existence of the Deed of Assignment, proceeded to
collect from Toledo Power Company the amount of P365,135.29. upon learning
this,Eurotech made several demands upon Cuizons to pay their obligations. As a result,
Cuizons were able to make partial payments to Eurotech. Cuizons total obligations
stood at P295,000.00 excluding interests and attorneys fees.

Edwin Cuizon alleged that he is not a real party in interest in this case. According
to him, he was acting as mere agent of his principal, which was the Impact Systems, in
his transaction with Eurotech and the latter was very much aware of this fact.

ISSUE:
Whether or not Edwin exceeded his authority when he signed the Deed of
Assignment thereby binding himself personally to pay the obligations to Eurotech.

RULING:
No.
Edwin insists that he was a mere agent of Impact Systems which is owned by
Erwin and that his status as such is known even to Eurotech as it is alleged in the
Complaint that he is being sued in his capacity as the sales manager of the said
business venture. Likewise, Edwin points to the Deed of Assignment which clearly
states that he was acting as a representative of Impact Systems in said transaction.

In a contract of agency, a person binds himself to render some service or to do
something in representation or on behalf of another with the latters consent. Its purpose
is to extend the personality of the principal or the party for whom another acts and from
whom he or she derives the authority to act. The basis of agency is representation, that
is, the agent acts for and on behalf of the principal on matters within the scope of his
authority and said acts have the same legal effect as if they were personally executed
by the principal.

An agent, who acts as such, is not personally liable to the party with whom he
contracts. There are 2 instances when an agent becomes personally liable to a third
person. The first is when he expressly binds himself to the obligation and the second is
when he exceeds his authority. In the last instance, the agent can be held liable if he
does not give the third party sufficient notice of his powers. Edwin does not fall within
any of the exceptions contained in Art. 1897.

In the absence of an agreement to the contrary, a managing agent may enter into any
contracts that he deems reasonably necessary or requisite for the protection of the
interests of his principal entrusted to his management.

Edwin Cuizon acted well-within his authority when he signed the Deed of Assignment.
Eurotech refused to deliver the 1 unit of sludge pump unless it received, in full, the
payment for Impact Systems indebtedness. Impact Systems desperately needed the
sludge pump for its business since after it paid the amount of P50,000.00 as down
payment it still persisted in negotiating with Eurotech which culminated in the execution
of the Deed of Assignment of its receivables from Toledo Power Company. The
significant amount of time spent on the negotiation for the sale of the sludge pump
underscores Impact Systems perseverance to get hold of the said equipment. Edwins
participation in the Deed of Assignment was reasonably necessary or was required in
order for him to protect the business of his principal



G.R. No. 149353 June 26, 2006
JOCELYN B. DOLES, Petitioner,
vs.
MA. AURA TINA ANGELES, Respondent.

FACTS:
Ma. Aura Tina Angeles (respondent) filed with the RTC a complaint for Specific
Performance with Damages against Jocelyn B. Doles (petitioner). Respondent alleged
that petitioner was indebted to the former in the concept of a personal loan amounting
to P405,430.00 representing the principal amount and interest; by virtue of a "Deed of
Absolute Sale",

petitioner, as seller, ceded to respondent, as buyer, a parcel of land, as
well as the improvements thereon, with an area of 42 square meters, covered by
Transfer Certificate of Title No. 382532,

and located at a subdivision project known as
Camella Townhomes Sorrente in Bacoor, Cavite, in order to satisfy her personal loan
with respondent.

Petitioner, then defendant, while admitting some allegations in the Complaint,
denied that she borrowed money from respondent, and averred that, she referred her
friends to respondent whom she knew to be engaged in the business of lending money
in exchange for personal checks through her capitalist Arsenio Pua. She alleged that
her friends, namely, Zenaida Romulo, Theresa Moratin, Julia Inocencio, Virginia Jacob,
and Elizabeth Tomelden, borrowed money from respondent and issued personal checks
in payment of the loan; that the checks bounced for insufficiency of funds; that despite
her efforts to assist respondent to collect from the borrowers, she could no longer locate
them; that, because of this, respondent became furious and threatened petitioner that if
the accounts were not settled, a criminal case will be filed against her.

ISSUE:
Is the respondent an agent of Arsenio Pua, the principal financier, on one hand;
and the petitioner to the debtors, on the other?

RULING:
Yes.
The Court has affirmed that, under Article 1868 of the Civil Code, the basis of
agency is representation. The question of whether an agency has been created is
ordinarily a question which may be established in the same way as any other fact, either
by direct or circumstantial evidence. The question is ultimately one of intention.

Agency
may even be implied from the words and conduct of the parties and the circumstances
of the particular case. Though the fact or extent of authority of the agents may not, as a
general rule, be established from the declarations of the agents alone, if one professes
to act as agent for another, she may be estopped to deny her agency both as against
the asserted principal and the third persons interested in the transaction in which he or
she is engaged.
In the case at bar, both petitioner and respondent have undeniably disclosed to
each other that they are representing someone else, and so both of them are estopped
to deny the same. It is evident from the record that petitioner merely refers actual
borrowers and then collects and disburses the amounts of the loan upon which she
received a commission; and that respondent transacts on behalf of her "principal
financier", a certain Arsenio Pua. If their respective principals do not actually and
personally know each other, such ignorance does not affect their juridical standing as
agents, especially since the very purpose of agency is to extend the personality of the
principal through the facility of the agent.




G.R. No. L-24332 January 31, 1978
RAMON RALLOS vs.
FELIX GO CHAN & SONS REALTY CORPORATION and COURT OF APPEALS

FACTS:
Concepcion and Gerundia both surnamed 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. On April 21,
1954, the sisters executed a special power of attorney in favor of their brother, Simeon
Rallos, authorizing him to sell for and in their behalf lot 5983. On March 3, 1955,
Concepcion Rallos died. On September 12, 1955, Simeon Rallos sold the undivided
shares of his sisters Concepcion and Gerundia in lot 5983 to Felix Go Chan & Sons
Realty Corporation for the sum of P10,686.90. The deed of sale was registered in the
Registry of Deeds of Cebu, TCT No. 11118 was cancelled, and a new transfer
certificate of Title No. 12989 was issued in the named of the vendee.

ISSUE:
Is the sale of the undivided share of Concepcion Rallos in lot 5983 valid although
it was executed by the agent after the death of his principal?

RULING:
NO.
Paragraph 3 of Article 1919 of the Civil Code provides:
Agency is extinguished
By the death, civil interdiction, insanity or insolvency of the principal or of
the agent;
Articles 1930 and 1931 of the Civil Code provide the exceptions to the general rule
afore-mentioned.
In the case at bar the exception applicable is that of ART.1931: (1) that the agent
acted without knowledge of the death of the principal and (2) that the third person who
contracted with the agent himself acted in good faith. Good faith here means that the
third person was not aware of the death of the principal at the time he contracted with
said agent. These two requisites must concur the absence of one will render the act of
the agent invalid and unenforceable.
In the instant case, it cannot be questioned that the agent, Simeon Rallos, knew of
the death of his principal at the time he sold the latter's share in Lot No. 5983 to
respondent corporation. The knowledge of the death is clearly to be inferred from the
pleadings filed by Simon Rallos before the trial court. That Simeon Rallos knew of the
death of his sister Concepcion is also a finding of fact of the court a quo and of
respondent appellate court when the latter stated that Simon Rallos 'must have known
of the death of his sister, and yet he proceeded with the sale of the lot in the name of
both his sisters Concepcion and Gerundia Rallos without informing appellant (the realty
corporation) of the death of the former.
On the basis of the established knowledge of Simon Rallos concerning the death of
his principal Concepcion Rallos, Article 1931 of the Civil Code is inapplicable. The law
expressly requires for its application lack of knowledge on the part of the agent of the
death of his principal; it is not enough that the third person acted in good faith.
In this case, the agent Simeon Rallos executed the sale notwithstanding notice of
the death of his principal. As a result, the agent's act is unenforceable against the estate
of his principal.