Dominion Insurance Corporation vs CA

G. R. No. 129919. February 6, 2002

Facts:
Private Respondent, Rodolfo Guevarra filed a complaint for sum of money against the
petitioner Dominion Insurance Corporation (DIC), seeking to recover a sum of money. He
claimed to have advanced, in his capacity as manager of the DIC, the claims filed by their
clients. DIC however stated that they are not liable to pay respondent because he had not
acted within his authority as an agent for Dominion. They have instructed the respondent
that the payment for the claims of the insured should be taken from the revolving fund, not
from respondents personal money.

Issue: WON the respondent have acted within his duties as the agent of petitioner

Ruling:
No, SC held that respondent did not act within his authority as agent of petitioner. By
contract of agency, a person 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. The basis for agency is representation. On the part of the principal, there must be an
actual intention to appoint or an intention naturally inferable from his words or actions; and
on the part of the agent, theremust be an intention to accept the appointment and act on it,
and in the absence of such intent, there is generally no agency.

In the case at bar, the respondent Guevarra was only given a general power in the acts of
administration, the payment of claims is not part of the general power granted to him by
DIC, hence under Article 1878 a Special Power of Attorney is required to make such
payments. Also, respondents action is limited by the written standard authority to pay,
where such payment must be taken from the revolving fund, which the respondent failed to
do so. Hence the petitioner is not liable for the expenses incurred by the agent. However,
while the law on agency prohibits respondent Guevarra from obtaining reimbursement, his
right to recover may still be justified under the general law on obligations and contracts.