AGENCY NOTES

I.

Intro
a. How is agency defined?
i. Consent
Article 1868. By the contract of agency 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.
(1709a)
Article 1869. Agency may be express, or implied from the acts
of the principal, from his silence or lack of action, or his failure to
repudiate the agency, knowing that another person is acting on
his behalf without authority.
Agency may be oral, unless the law requires a specific form.
(1710a)
Article 1870. Acceptance by the agent may also be express, or
implied from his acts which carry out the agency, or from his
silence or inaction according to the circumstances. (n)
Article 1871. Between persons who are present, the acceptance
of the agency may also be implied if the principal delivers his
power of attorney to the agent and the latter receives it without
any objection. (n)
Article 1872. Between persons who are absent, the acceptance
of the agency cannot be implied from the silence of the agent,
except:
(1) When the principal transmits his power of attorney to the
agent, who receives it without any objection;
(2) When the principal entrusts to him by letter or telegram a
power of attorney with respect to the business in which he is
habitually engaged as an agent, and he did not reply to the
letter or telegram. (n)
Article 1898. If the agent contracts in the name of the principal,
exceeding the scope of his authority, and the principal does not

ratify the contract, it shall be void if the party with whom the
agent contracted is aware of the limits of the powers granted by
the principal. In this case, however, the agent is liable if he
undertook to secure the principal's ratification. (n)
Article 1901. A third person cannot set up the fact that the
agent has exceeded his powers, if the principal has ratified, or has
signified his willingness to ratify the agent's acts. (n)
Article 1910. The principal must comply with all the obligations
which the agent may have contracted within the scope of his
authority.
As for any obligation wherein the agent has exceeded his power,
the principal is not bound except when he ratifies it expressly or
tacitly. (1727)
Article 1317. 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.
A contract entered into in the name of another by one who has no
authority or legal representation, or who has acted beyond his
powers, shall be unenforceable, unless it is ratified, expressly or
impliedly, by the person on whose behalf it has been executed,
before it is revoked by the other contracting party. (1259a)
Article 1403. The following contracts are unenforceable, unless
they are ratified:
(1) Those entered into in the name of another person by one who
has been given no authority or legal representation, or who has
acted beyond his powers;
(2) Those that do not comply with the Statute of Frauds as set
forth in this number. In the following cases an agreement
hereafter made shall be unenforceable by action, unless the
same, or some note or memorandum, thereof, be in writing, and
subscribed by the party charged, or by his agent; evidence,
therefore, of the agreement cannot be received without the
writing, or a secondary evidence of its contents:

(a) An agreement that by its terms is not to be performed

within a year from the making thereof;
(b) A special promise to answer for the debt, default, or
miscarriage of another;
(c) An agreement made in consideration of marriage, other
than a mutual promise to marry;
(d) An agreement for the sale of goods, chattels or things in
action, at a price not less than five hundred pesos, unless
the buyer accept and receive part of such goods and
chattels, or the evidences, or some of them, of such things in
action or pay at the time some part of the purchase money;
but when a sale is made by auction and entry is made by the
auctioneer in his sales book, at the time of the sale, of the
amount and kind of property sold, terms of sale, price,
names of the purchasers and person on whose account the
sale is made, it is a sufficient memorandum;
(e) An agreement for the leasing for a longer period than one
year, or for the sale of real property or of an interest therein;
( f ) A representation as to the credit of a third person.
(3) Those where both parties are incapable of giving consent to a
contract
1. Express; ratification
2. Implied; ratification

ii. Object
iii. Consideration
Article 1875. Agency is presumed to be for a
compensation, unless there is proof to the contrary. (n)
b. Who are the parties in a K of A?
c. Must parties be capacitated?

II.

What is the form of the K of A?

Article 1869. Agency may be express, or implied from the acts of
the principal, from his silence or lack of action, or his failure to
repudiate the agency, knowing that another person is acting on his
behalf without authority.
Article 1874. When a sale of a piece of land or any interest therein
is through an agent, the authority of the latter shall be in writing;
otherwise, the sale shall be void.
a. Oral
b. Written

III.

Who has oblig to det. existence and scope of Agency?

IV.

How is agency distinguished from other Ks/ rel?

a. Master servant
Article 1689. Household service shall always be reasonably
compensated. Any stipulation that household service is without
compensation shall be void. Such compensation shall be in
addition to the house helper's lodging, food, and medical
attendance.
Article 1690. The head of the family shall furnish, free of charge,
to the house helper, suitable and sanitary quarters as well as
adequate food and medical attendance.
Article 1691. If the house helper is under the age of eighteen
years, the head of the family shall give an opportunity to the
house helper for at least elementary education. The cost of such
education shall be a part of the house helper's compensation,
unless there is a stipulation to the contrary.
Article 1692. No contract for household service shall last for
more than two years. However, such contract may be renewed
from year to year.

Article 1693. The house helper's clothes shall be subject to

stipulation. However, any contract for household service shall be
void if thereby the house helper cannot afford to acquire suitable
clothing.
Article 1694. The head of the family shall treat the house helper
in a just and humane manner. In no case shall physical violence
be used upon the house helper.
Article 1695. House helpers shall not be required to work more
than ten hours a day. Every house helper shall be allowed four
days' vacation each month, with pay.
Article 1696. In case of death of the house helper, the head of
the family shall bear the funeral expenses if the house helper has
no relatives in the place where the head of the family lives, with
sufficient means therefor.
Article 1697. If the period for household service is fixed neither
the head of the family nor the house helper may terminate the
contract before the expiration of the term, except for a just cause.
If the house helper is unjustly dismissed, he shall be paid the
compensation already earned plus that for fifteen days by way of
indemnity. If the house helper leaves without justifiable reason, he
shall forfeit any salary due him and unpaid, for not exceeding
fifteen days.
Article 1698. If the duration of the household service is not
determined either by stipulation or by the nature of the service,
the head of the family or the house helper may give notice to put
an end to the service relation, according to the following rules:
(1) If the compensation is paid by the day, notice may be given on
any day that the service shall end at the close of the following
day;
(2) If the compensation is paid by the week, notice may be given,
at the latest on the first business day of the week, that the
service shall be terminated at the end of the seventh day from
the beginning of the week;

(3) If the compensation is paid by the month, notice may be

given, at the latest, on the fifth day of the month, that the service
shall cease at the end of the month.
Article 1699. Upon the extinguishment of the service relation,
the house helper may demand from the head of the family a
written statement on the nature and duration of the service and
the efficiency and conduct of the house helper.
b. E-e
Article 1700. The relations between capital and labor are not
merely contractual. They are so impressed with public interest
that labor contracts must yield to the common good. Therefore,
such contracts are subject to the special laws on labor unions,
collective bargaining, strikes and lockouts, closed shop, wages,
working conditions, hours of labor and similar subjects.
c. Lease of service
ARTICLE 1644. In the lease of work or service, one of the parties
binds himself to execute a piece of work or to render to the other
some service for a price certain, but the relation of principal and
agent does not exist between them. (1544a)
d. Indep contractor
Article 1713. By the contract for a piece of work the contractor
binds himself to execute a piece of work for the employer, in
consideration of a certain price or compensation. The contractor
may either employ only his labor or skill, or also furnish the
material.
e. Trust
Article 1440. A person who establishes a trust is called the
trustor; one in whom confidence is reposed as regards property
for the benefit of another person is known as the trustee; and the
person for whose benefit the trust has been created is referred to
as the beneficiary.
f. Sale

Article 1458. By the contract of sale one of the contracting

parties obligates himself to transfer the ownership and to deliver
a determinate thing, and the other to pay therefor a price certain
in money or its equivalent.
A contract of sale may be absolute or conditional
g. Partnership
Article 1767. By the contract of partnership two or more persons
bind themselves to contribute money, property, or industry to a
common fund, with the intention of dividing the profits among
themselves.
Two or more persons may also form a partnership for the exercise
of a profession.
h. QC
Article 2144. Whoever voluntarily takes charge of the agency or
management of the business or property of another, without any
power from the latter, is obliged to continue the same until the
termination of the affair and its incidents, or to require the person
concerned to substitute him, if the owner is in a position to do so.
This juridical relation does not arise in either of these instances:
(1) When the property or business is not neglected or abandoned;
(2) If in fact the manager has been tacitly authorized by the
owner.
In the first case, the provisions of articles 1317, 1403, No. 1, and
1404 regarding unauthorized contracts shall govern.
In the second case, the rules on agency in Title X of this Book
shall be applicable. (1888a)
Article 2145. The officious manager shall perform his duties with
all the diligence of a good father of a family, and pay the damages
which through his fault or negligence may be suffered by the owner
of the property or business under management.

The courts may, however, increase or moderate the indemnity

according to the circumstances of each case. (1889a)
i. Jud Admin
j. Broker