Professional Documents
Culture Documents
REVIEWER
1. What
is
a
“Procuring
Cause”?
In
Phil.
Health-‐Care
Providers
(Maxicare)
v.
Estrada,
542
SCRA
616
(2008),
the
Court
held
that
the
term
“procuring
cause”
in
describing
a
broker’s
activity,
refers
to
a
cause
originating
a
series
of
events
which,
without
break
in
their
continuity,
result
in
the
accomplishment
of
the
prime
objective
of
the
employment
of
the
broker—producing
a
purchaser
ready,
willing
and
able
to
buy
on
the
owner’s
terms.
To
be
regarded
as
the
“procuring
cause”
of
a
sale
as
to
be
entitled
to
a
commission,
a
broker’s
efforts
must
have
been
the
foundation
on
which
the
negotiations
resulting
in
a
sale
began.
2. Power
and
Authority
of
the
Agent
Authority
is
the
power
of
the
agent
to
affect
the
legal
relations
of
the
principal
by
acts
done
in
accordance
with
the
principal’s
manifestation
of
consent
to
him.
The
authority
of
the
agent
is
the
very
essence
–
the
sine
qua
non
–
of
the
principal
and
agent
relationship.
Power
is
taken
to
mean
an
ability
on
the
part
of
the
agent
to
produce
a
change
in
a
given
legal
relation,
by
doing
and
not
doing
a
given
act.
Authority
may
be
considered
the
source
or
cause,
while
power
is
the
effect.
3. Fraud
rectifying
trust
as
compared
to
Intention
enforcing
trust
ESTATE
OF
MARGARITA
D.
CABACUNGAN,
represented
G.R.
No.
175073
by
LUZ
LAIGO-‐ALI,
Petitioner,
Present:
*
CARPIO,
J.,
-‐
versus
-‐
VELASCO,
JR.,
J.,
Chairperson,
**
BRION,
PERALTA,
and
***
MARILOU
LAIGO,
PEDRO
ROY
LAIGO,
STELLA
BALAGOT
SERENO,
JJ.
and
SPOUSES
MARIO
B.
CAMPOS
AND
JULIA
S.
CAMPOS,
Promulgated:
Respondents.
August
15,
2011
A
trust
is
the
legal
relationship
between
one
person
having
an
equitable
ownership
of
property
and
another
person
owning
the
legal
title
to
such
property,
the
equitable
ownership
of
the
former
entitling
him
to
the
performance
of
certain
duties
and
the
exercise
of
certain
powers
by
the
latter. Trusts
are
either
express
or
implied.
Express
or
direct
trusts
are
created
by
the
direct
and
positive
acts
of
the
parties,
by
some
writing
or
deed,
or
will,
or
by
oral
declaration
in
words
evincing
an
intention
to
create
a
trust.
Implied
trusts
also
called
trusts
by
operation
of
law,
indirect
trusts
and
involuntary
trusts
arise
by
legal
implication
based
on
the
presumed
intention
of
the
parties
or
on
equitable
principles
independent
of
the
particular
intention
of
the
parties. They
are
those
which,
without
being
expressed,
are
deducible
from
the
nature
of
the
transaction
as
matters
of
intent
or,
independently
of
the
particular
intention
of
the
parties,
as
being
inferred
from
the
transaction
by
operation
of
law
basically
by
reason
of
equity.
Implied
trusts
are
further
classified
into
constructive
trusts
and
resulting
trusts.
Constructive
trusts,
on
the
one
hand,
come
about
in
the
main
by
operation
of
law
and
not
by
agreement
or
intention.
They
arise
not
by
any
word
or
phrase,
either
expressly
or
impliedly,
evincing
a
direct
intention
to
create
a
trust,
but
one
which
arises
in
order
to
satisfy
the
demands
of
justice. Also
known
as
trusts
ex
maleficio,
trusts
ex
delicto
and
trusts
de
son
tort,
they
are
construed
against
one
who
by
actual
or
constructive
fraud,
duress,
abuse
of
confidence,
commission
of
a
wrong
or
any
form
of
unconscionable
conduct,
artifice,
concealment
of
questionable
means,
or
who
in
any
way
against
equity
and
good
conscience
has
obtained
or
holds
the
legal
right
to
property
which
he
ought
not,
in
equity
and
good
conscience,
hold
and
enjoy.
They
are
aptly
characterized
as
fraud-‐rectifying
trust,
imposed
by
equity
to
satisfy
the
demands
of
justice
and
to
defeat
or
prevent
the
wrongful
act
of
one
of
the
parties.
Constructive
trusts
are
illustrated
in
Articles
1450,
1454,
1455
and
1456.
On
the
other
hand,
resulting
trusts
arise
from
the
nature
or
circumstances
of
the
consideration
involved
in
a
transaction
whereby
one
person
becomes
invested
with
legal
title
but
is
obligated
in
equity
to
hold
his
title
for
the
benefit
of
another.
This
is
based
on
the
equitable
doctrine
that
valuable
consideration
and
not
legal
title
is
determinative
of
equitable
title
or
interest
and
is
always
presumed
to
have
been
contemplated
by
the
parties.
Such
intent
is
presumed
as
it
is
not
expressed
in
the
instrument
or
deed
of
conveyance
and
is
to
be
found
in
the
nature
of
their
transaction.
Implied
trusts
of
this
nature
are
hence
describable
as
intention-‐enforcing
trusts.
Specific
examples
of
resulting
trusts
may
be
found
in
the
Civil
Code,
particularly
Articles
1448,
1449,
1451,
1452
and
1453.
Articles
1448
to
1456
of
the
Civil
Code
enumerate
cases
of
implied
trust,
but
the
list
according
to
Article
1447
is
not
exclusive
of
others
which
may
be
established
by
the
general
law
on
trusts
so
long
as
the
limitations
laid
down
in
Article
1442
are
observed,
that
is,
that
they
be
not
in
conflict
with
the
New
Civil
Code,
the
Code
of
Commerce,
the
Rules
of
Court
and
special
laws.
While
resulting
trusts
generally
arise
on
failure
of
an
express
trust
or
of
the
purpose
thereof,
or
on
a
conveyance
to
one
person
upon
a
consideration
from
another
(sometimes
referred
to
as
a
purchase-‐
money
resulting
trust),
they
may
also
be
imposed
in
other
circumstances
such
that
the
court,
shaping
judgment
in
its
most
efficient
form
and
preventing
a
failure
of
justice,
must
decree
the
existence
of
such
a
trust.
A
resulting
trust,
for
instance,
arises
where,
there
being
no
fraud
or
violation
of
the
trust,
the
circumstances
indicate
intent
of
the
parties
that
legal
title
in
one
be
held
for
the
benefit
of
another.
It
also
arises
in
some
instances
where
the
underlying
transaction
is
without
consideration,
such
as
that
contemplated
in
Article
1449
of
the
Civil
Code.
Where
property,
for
example,
is
gratuitously
conveyed
for
a
particular
purpose
and
that
purpose
is
either
fulfilled
or
frustrated,
the
court
may
affirm
the
resulting
trust
in
favor
of
the
grantor
or
transferor,
where
the
beneficial
interest
in
property
was
not
intended
to
vest
in
the
grantee.
4. Agency
coupled
with
interest
As
held
by
the
Supreme
Court
in
the
case
of
[G.R.
No.
156015.
August
11,
2005]
REPUBLIC
OF
THE
PHILIPPINES
vs.
HON.
VICTORINO
EVANGELISTA:
Art.
1868
of
the
Civil
Code
provides
that
by
the
contract
of
agency,
an
agent
binds
himself
to
render
some
service
or
do
something
in
representation
or
on
behalf
of
another,
known
as
the
principal,
with
the
consent
or
authority
of
the
latter.
A
contract
of
agency
is
generally
revocable
as
it
is
a
personal
contract
of
representation
based
on
trust
and
confidence
reposed
by
the
principal
on
his
agent.
As
the
power
of
the
agent
to
act
depends
on
the
will
and
license
of
the
principal
he
represents,
the
power
of
the
agent
ceases
when
the
will
or
permission
is
withdrawn
by
the
principal.
Thus,
generally,
the
agency
may
be
revoked
by
the
principal
at
will.
However,
an
exception
to
the
revocability
of
a
contract
of
agency
is
when
it
is
coupled
with
interest,
i.e.,
if
a
bilateral
contract
depends
upon
the
agency.
The
reason
for
its
irrevocability
is
because
the
agency
becomes
part
of
another
obligation
or
agreement.
It
is
not
solely
the
rights
of
the
principal
but
also
that
of
the
agent
and
third
persons
which
are
affected.
Hence,
the
law
provides
that
in
such
cases,
the
agency
cannot
be
revoked
at
the
sole
will
of
the
principal.
Lim
v.
Saban:
Under
Article
1927
of
the
Civil
Code,
an
agency
cannot
be
revoked
if
a
bilateral
contract
depends
upon
it,
or
if
it
is
the
means
of
fulfilling
an
obligation
already
contracted,
or
if
a
partner
is
appointed
manager
of
a
partnership
in
the
contract
of
partnership
and
his
removal
from
the
management
is
unjustifiable.
Stated
differently,
an
agency
is
deemed
one
coupled
with
an
interest
where
it
is
established
for
the
mutual
benefit
of
the
principal
and
of
the
agent,
or
for
the
interest
of
the
principal
and
of
third
persons,
and
it
cannot
be
revoked
by
the
principal
so
long
as
the
interest
of
the
agent
or
of
a
third
person
subsists.
In
an
agency
coupled
with
an
interest,
the
agent’s
interest
must
be
in
the
subject
matter
of
the
power
conferred
and
not
merely
an
interest
in
the
exercise
of
the
power
because
it
entitles
him
to
compensation.
When
an
agent’s
interest
is
confined
to
earning
his
agreed
compensation,
the
agency
is
not
one
coupled
with
an
interest,
since
an
agent’s
interest
in
obtaining
his
compensation
as
such
agent
is
an
ordinary
incident
of
the
agency
relationship.
5. Authority
of
the
lawyer
is
presumed
As
a
general
rule
in
the
law
on
agency,
agency
is
generally
not
presumed;
the
relationship
between
principal
and
agent
must
exist
as
a
fact.
However,
the
authority
of
attorney
to
appear
on
behalf
of
his
client
is
one
that
is
presumed.
As
provided
for
in
Sec.
21,
Rule
138
of
the
Rules
of
Court:
An
attorney
is
presumed
to
be
properly
authorized
to
represent
any
cause
in
which
he
appears,
and
no
written
power
of
attorney
is
required
to
authorize
him
to
appear
in
court
for
his
client,
but
the
presiding
judge
may,
on
motion
of
either
party
and
on
reasonable
grounds
therefor
being
shown,
require
any
attorney
who
assumes
the
right
to
appear
in
a
case
to
produce
or
prove
the
authority
under
which
he
appears,
and
to
disclose,
whenever
pertinent
to
any
issue,
the
name
of
the
person
who
employed
him,
and
may
thereupon
make
such
order
as
justice
requires.
An
attorney
willfully
appearing
in
court
for
a
person
without
being
employed,
unless
by
leave
of
the
court,
may
be
punished
for
contempt
as
an
officer
of
the
court
who
has
misbehaved
in
his
official
transactions.
6. Do
you
need
an
SPA
when
selling
a
land,
or
just
an
ordinary
authority?
(Case)
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.
As
a
general
rule,
the
agent’s
authority
may
be
oral
or
written
(Art.
1869).
An
agency
to
sell
on
commission
basis
does
not
belong
to
any
of
the
categories
of
contracts
for
which
the
law
requires
certain
formalities;
hence,
it
is
valid
and
enforceable
in
whatever
form
it
may
be
entered
into.
Under
this
article,
the
sale
of
a
piece
of
land
(not
any
other
real
estate)
or
any
interest
thereon,
like
usufruct,
mortgage,
etc.,
through
an
agent
is
void
unless
the
authority
of
the
agent
to
sell
is
in
writing.
A
written
special
power
of
attorney
is
necessarily
“not
only”
to
protect
the
interest
of
an
unsuspecting
owner
from
being
prejudiced
by
the
unwarranted
act
of
another
but
also
to
caution
the
buyer
to
assure
himself
of
the
specific
authorization
of
the
putative
agent.
7. What
is
the
effect
of
an
agent
selling
a
property
of
principal
who
dies,
known
by
buyer
and
not
of
the
agent-‐seller?
Article
1919.
Agency
is
extinguished:
xxx
(3)
by
the
death,
civil
interdiction,
insanity
or
insolvency
of
the
principal
or
of
the
agent.
General
rule:
by
reason
of
the
very
nature
of
the
relationship
between
the
principal
and
agent,
agency
is
extinguished
ipso
jure
upon
the
death
of
either
principal
or
agent.
Exceptions:
(a)
that
the
agency
is
coupled
with
interest
(Art.
1930);
and,
(b)
that
the
act
of
the
agent
was
executed
without
knowledge
of
the
death
of
the
principal
and
the
third
person
who
contracted
with
the
agent
acted
in
good
faith
(Art.
1931)
Article
1931.
Anything
done
by
the
agent,
without
knowledge
of
the
death
of
the
principal
or
of
any
other
cause
which
extinguishes
the
agency,
is
valid
and
shall
be
fully
effective
with
respect
to
third
persons
who
may
have
contracted
with
him
in
good
faith.
Normally,
the
death
of
the
principal
will
terminate
the
agency.
However,
the
agent
is
required
to
“finish
the
business
already
begun
on
the
death
of
the
principal
should
delay
entail
any
danger”
(Art.
1884,
par.
2).
The
death
of
the
principal
extinguishes
the
agency;
but
in
the
same
way
that
revocation
of
the
agency
does
not
prejudice
third
persons
who
have
dealt
with
the
agent
in
good
faith
without
notice
of
the
revocation,
such
third
persons
are
protected
where
it
is
not
shown
that
the
agent
had
knowledge
of
the
termination
of
the
agency
because
of
the
death
of
the
principal
or
of
any
other
cause
which
extinguishes
the
agency.
Rallos
v.
Felix
Go
Chan
&
Sons
Realty
Corp.
Under
Article
1931,
an
act
done
by
the
agent
after
the
death
of
the
principal
is
valid
and
effective
only
under
two
(2)
conditions:
(1)
that
the
agent
acted
without
knowledge
of
the
death
of
the
principal;
and
(2)
that
the
third
persons
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.
8. How
do
you
sell
a
property
when
you’re
in
abroad?
What
are
the
requirements?
9. Personal
property,
may
an
OFW
sell
his
car
while
abroad
through
just
a
text
or
call?
10. Obligation
to
render
an
account,
what
is
void?
When
is
the
agent
exempt
from
rendering
an
account?
Article
1891.
Every
agent
is
bound
to
render
an
account
of
his
transactions
and
to
deliver
to
the
principal
whatever
he
may
have
received
by
virtue
of
the
agency,
even
though
it
may
not
be
owing
to
the
principal.
Every
stipulation
exempting
the
agent
from
the
obligation
to
render
an
account
shall
be
void.
It
is
the
duty
of
the
agent
to
account
for
and
to
deliver
to
the
principal
(or
an
authorized
third
party)
all
money
and
property
which
may
have
come
into
his
hands
or
of
sub-‐agent
appointed
by
him
by
virtue
of
or
as
a
result
of
the
agency.
The
agent
is
exempted
from
rendering
account
when:
(1)
the
agent
or
broker
acted
only
as
a
middleman
with
the
task
of
merely
bringing
together
the
vendor
and
the
vendee,
who
themselves
thereafter
will
negotiate
on
the
terms
and
conditions
of
the
transaction;
(2)
if
the
agent
or
broker
had
informed
the
principal
of
the
gift
or
bonus
or
profit
he
received
from
the
purchaser
and
his
principal
did
not
object
thereto;
(3)
where
a
right
of
lien
exists
in
favor
of
the
agent.
11. Rule
in
Appointment
of
substitute/sub-‐agent
12. What
is
the
effect
of
receiving
a
secret
profit?
It
has
been
held
that
an
agent
who
takes
a
secret
profit
in
the
nature
of
a
bonus,
gratuity
or
personal
benefit
from
the
vendee,
without
revealing
the
same
to
his
principal,
the
vendor,
is
guilty
of
breach
of
his
loyalty
to
the
principal
and
forfeits
his
right
to
collect
the
commission
from
his
principal,
even
if
the
principal
does
not
suffer
any
injury
by
reason
of
such
breach
of
fidelity,
or
that
he
obtained
better
results,
or
that
the
agency
is
a
gratuitous
one,
or
that
usage
or
custom
allows
it;
because
the
rule
is
to
prevent
the
possibility
of
any
wrong,
not
to
remedy
or
repair
an
actual
damage.
By
taking
such
profit
or
bonus
or
gift
or
propina
from
the
vendee,
the
agent
thereby
assumes
a
position
wholly
inconsistent
with
that
of
being
an
agent
for
his
principal,
who
has
a
right
to
treat
him,
insofar
as
his
commission
is
concerned,
as
if
no
agency
existed.
The
fact
that
the
principal
may
have
been
benefited
by
the
valuable
services
of
the
said
agent
does
not
exculpate
the
agent
who
has
only
himself
to
blame
for
such
a
result
by
reason
of
his
treachery
or
perfidy.
13. What
is
the
effect
of
stating
a
false
statement
(limited
partnership)
Art.
1847.
If
the
certificate
contains
a
false
statement,
one
who
suffers
loss
by
reliance
on
such
statement
may
hold
liable
any
party
to
the
certificate
who
knew
the
statement
to
be
false:
(1)
at
the
time
he
signed
the
certificate,
or
(2)
subsequently,
but
within
a
sufficient
time
before
the
statement
was
relied
upon
to
enable
him
to
cancel
or
amend
the
certificate,
or
to
file
a
petition
for
its
cancellation
or
amendment
as
provided
in
article
1865.
Requisites:
under
this
provision,
any
partner
to
the
certificate
containing
a
false
statement
is
liable
provided
the
following
requisites
are
present:
(a)
he
knew
the
statement
to
be
false
at
the
time
he
signed
the
certificate,
or
subsequently,
but
having
sufficient
time
to
cancel
or
amend
it
or
file
a
petition
for
its
cancellation
or
amendment,
he
failed
to
do
so;
(b)
the
person
seeking
to
enforce
liability
has
relied
upon
the
false
statement
in
transacting
business
with
the
partnership;
and,
(c)
the
person
suffered
loss
as
a
result
of
reliance
upon
such
false
statement.
The
liability
imposed
by
article
1847
is
merely
a
statutory
penalty
and
does
not
make
the
limited
partner
a
general
partner
for
all
purposes,
even
as
to
third
persons.
14. TCT
is
a
form
of
trust
15. Donation
v.
simple
deed
of
sale
16. Cestui
Que
Trust
17. Aznar
case
determining
prescription
18. Cabacungan
case
determining
recovering
property
mistakenly
19. Obligations
of
the
agent
with
compensation
from
the
buyer
20. Husband
mortgaged
their
property
with
his
wife
without
consent
21. SPA
v.
GPA
SPA
ART
1878
Part
I.
A. Between
the
two
agents
designated,
the
agent
that
can
prove
that
he
is
the
procuring
cause
is
the
one
entitled
to
receive
the
commission
as
a
result
of
the
sale.
The
procuring
cause
is
an
unbroken
chain
of
events
that
led
to
the
perfection
of
the
sale
between
the
buyer
and
seller.
B. The
cestui
que
trust
or
the
beneficiary
in
the
trust
agreement
is
the
person
for
whose
benefit
the
trust
was
constituted.
Such
person
holds
the
beneficial
ownership
over
the
property.
A
trustor
may
at
the
same
time
be
the
beneficiary.
For
example,
A,
as
trustor,
reposes
his
confidence
and
transfers
legal
title
over
his
property
to
B
for
the
latter
to
preserve
it
and
collect
its
fruits
for
A’s
benefit
and
enjoyment.
C. Owing
to
the
fiduciary
relation
in
a
contract
of
agency,
with
the
agent
representing
and
advancing
the
interest
of
the
principal,
it
is
difficult
to
allow
the
agent
to
serve
two
masters
at
the
same
time.
Although
it
is
not
prohibited,
as
when
the
two
principals
have
knowledge
and
have
consented
to
such,
the
agent
is
placed
in
a
difficult
situation
of
serving
what
would
possibly
be
conflicting
interests.
For
instance,
an
agent
would
have
difficulty
serving
as
such
to
both
the
vendor
and
vendee,
with
the
former
aiming
for
the
highest
possible
selling
price,
and
the
latter
seeking
a
bargain.
D. Under
Sec.
21,
Rule
138
of
the
Rules
of
Court,
the
authority
of
a
lawyer
who
appears
in
court
is
presumed.
No
written
authority
is
required
to
be
presented.
Nevertheless,
upon
motion
of
the
adverse
party
upon
reasonable
grounds,
and
in
the
interest
of
justice,
the
court
may
require
a
lawyer
to
present
his
authority
from
the
client.
E. An
ordinary
contract
of
agency
is
subject
to
the
general
rule
that
the
same
may
be
revoked
at
will
by
the
principal.
An
exception
to
this
general
rule
is
when
it
is
an
agency
coupled
with
interest.
Since
an
agency
coupled
with
interest
is
constituted
for
the
mutual
benefit
of
the
principal
and
agent
or
of
a
third
person,
the
principal
cannot
revoke
the
agency
while
such
interest
subsists.
Moreover,
in
an
ordinary
contract
of
agency,
the
agent
is
merely
interested
in
earning
his
compensation
arising
from
the
services
he
rendered.
If
it
is
one
coupled
with
interest,
the
agent
is
interested
as
well
in
the
subject
matter
of
the
agency.
Part
II.
1.a.
The
contract
of
agency
is
extinguished.
Under
the
law
in
agency,
as
a
general
rule,
indeed
death
of
the
principal
extinguishes
the
agency.
However,
if
in
accord
to
such
contract
and
acting
with
his
authority,
the
agent
successfully
sealed
a
contract
without
knowledge
of
the
death
of
the
principal,
at
the
time
of
execution
of
the
deed
evidencing
the
contract,
the
same
is
valid.
1.b.
Since
the
sale
is
executed
within
the
authority
granted
to
the
agent,
and
without
knowledge
of
the
death
of
the
principal,
the
contract
of
sale
is
valid.
The
buyer,
therefore
has
acquired
ownership
over
the
land.
2.a.
The
sale
is
void.
Under
the
law
on
agency,
a
special
power
of
attorney
is
required
in
authorizing
the
agent
to
enter
into
contracts
involving
ownership
of
an
immovable,
or
in
conveying
real
rights.
In
the
instant
case,
the
authority
of
Y,
the
agent,
form
X,
the
principal,
to
sell
the
apartment,
an
immovable
property,
was
given
orally.
The
authority
of
the
agent
being
void,
the
sale
must
be
void
as
well.
Furthermore,
if
the
sale
should
include
the
land
on
which
the
apartment
stands,
the
law
is
clear
in
stating
that
the
authority
of
the
agent
to
sell
must
be
in
writing;
otherwise,
the
sale
is
void.
2.b.
My
answer
will
be
the
same.
It
is
still
void,
for
lack
of
proper
authority
of
the
agent
to
enter
into
a
sale
conract.
3.a.
I
would
advise
her
that
the
sale
cannot
be
properly
contested
on
the
ground
of
lack
of
written
authority
to
sell
on
the
part
of
the
agent.
A
contract
of
agency
may
be
entered
into
in
writing
or
orally,
unless
the
law
requires
a
specific
form.
In
the
sale
of
a
movable,
however,
no
specific
form
is
required
by
law
in
granting
the
agent
the
authority
to
sell.
The
agent’s
authority,
in
this
case
is
therefore
valid.
3.b.
Yes.
Under
the
Civil
Code,
by
a
contract
of
agency,
one
party
binds
himself
to
render
some
service
or
to
do
something
in
representation
of
another,
with
the
consent
and
knowledge
of
the
latter.
In
the
case
at
bar,
the
agent
friend
was
asked
by
the
principal
through
text
message
to
look
for
a
buyer,
negotiate
a
good
price
in
the
process
of
selling
his
car
the
authority
was
even
up
to
the
point
of
finalizing
the
deed
because,
as
stated,
the
execution
of
the
document
by
the
principal
will
only
be
for
formality.
The
elements
of
agency
are
present.
There
is
consent;
a
requirement
to
do
some
service,
which
by
his
acts,
the
agent
bound
himself
to
do;
there
was
representation
of
the
principal.
The
consideration
is
presumed
to
be
for
compensation,
although
liberality,
in
a
gratuitous
agency
is
possible.
The
scope
of
authority
is
likewise
clear.
4.a.
The
agent
is
liable.
Under
the
law,
when
the
agent
is
authorized
to
appoint
the
substitute,
but
without
the
principal
designating
the
person,
and
the
substitute
is
notoriously
incompetent
or
insolvent,
the
agent
is
liable.
Facts
show
that
the
agent
was
granted
authority
to
appoint
a
substitute,
who
was
shown
to
be
insolvent.
As
such,
the
law
renders
the
agent
liable,
particularly
since
the
principal
did
not
designate
the
person
who
will
be
the
substitute.
4.b.
I
would
advise
the
agent
that
should
the
principal
proceed
against
him,
he,
in
turn,
should
file
a
counterclaim
against
the
substitute
whom
he
appointed.
He
should
also
proceed
against
the
creditors,
who
in
bad
faith
attacked
the
properties
in
possession
of
the
substitute,
but
not
owned
by
him.
5.
There
is
an
implied
constructive
trust
created
between
M
and
his
aunt
N,
with
M
as
the
trustee.
The
TCT
under
the
name
of
N
is
not
evidence
of
ownership.
The
Supreme
Court
has
underscored
the
difference
between
a
certificate
of
title
from
ownership,
the
former
being
a
mere
evidence
of
the
latter.
The
Court
has
also
said
that
a
trustee
who
has
in
his
name
a
Torrens
title,
held
by
him
for
another
will
not
be
allowed
to
betray
the
trust
by
virtue
of
the
Torrens
system.
Nevertheless,
15
years
having
lapsed,
acquisitive
prescription
has
set
in
in
favor
of
M
and
his
heirs,
upon
his
death.
The
Supreme
Court
has
held
that
in
a
constructive
trust,
10
years
is
required
for
acquisitive
prescription
to
set
in.
Furthermore,
the
action
of
O
is
barred
by
laches.
N,
as
trustor,
slept
on
her
rights
for
15
years,
without
demanding
M
to
return
the
title,
even
after
M
was
able
to
pay
his
loan
and
presumably
grow
his
business,
and
even
after
M’s
death.
Such
failure
to
assert
her
rights
is
an
indication
that
N
has
renounced
the
same
in
favor
of
M.
Therefore,
M,
upon
his
death,
his
heirs
have
the
legal
title
over
the
property.
6.
Yes,
P
is
entitled
to
recover
from
A.
The
law
requires
the
agent
to
render
account
and
to
deliver
to
the
principal
all
the
money
received
by
the
former,
even
though
not
owing
to
the
latter.
This
includes
any
commission
received
by
the
agent
from
the
other
party,
in
this
case
the
buyer.
The
non-‐disclosure
of
the
“secret
profit”
is
a
violation
of
the
fiduciary
relation
between
the
principal
and
the
agent,
much
more
if
the
payment
of
the
“secret
profit”
results
from
bargaining
agreement
detrimental
to
the
interest
of
the
herein
seller.
7.a.
L
will
be
liable
to
such
false
statement
if
a
person,
relying
on
such
false
statement
suffers
loss
as
a
result.
However,
considering
that
the
actual
contribution
is
more
than
sufficient
to
cover
the
declared
contribution,
on
which
third
persons
would
rely,
loss
on
their
part
may
not
be
imminent.
Until
loss
is
proven,
arising
from
such
false
statement,
L
is
not
liable.
8.
A
is
liable
to
pay
S.
An
agent
acting
as
such
is
not
liable
to
third
persons
for
contracts
entered
into
on
behalf
of
the
principal,
if
it
is
done
within
his
authority.
Otherwise,
he
shall
be
liable,
unless
the
principal
ratifies
his
acts
or
fails
to
repudiate
the
same.
Here,
A
did
not
carry
out
the
instruction
of
P
to
buy
only
“class
A”
copra.
There
can
also
be
no
ratification
as
P
clearly
questions
the
quality
of
the
copra
A
is
supplying.
Therefore,
for
procuring
from
S
copra
of
lesser
grade,
which
is
contrary
to
the
instructions
of
P,
A
should
be
liable.
9.
No,
the
mortgage
is
not
binding
upon
W.
The
reasoning
of
H
that
the
debts
of
the
law
firm
would
qualify
as
his
loan,
he
being
a
general
partner,
in
order
to
come
within
the
terms
of
the
power
of
attorney
is
not
tenable.
The
law
firm,
as
a
professional
partnership,
has
a
separate
and
distinct
personality.
It
can
enter
into
contracts
and
incur
obligations
on
its
own
name.
The
law
firm’s
debt,
therefore,
is
distinct
from
H’s
debt.
As
such,
the
mortgage
executed
is
beyond
the
authority
granted
by
W,
and
not
binding
upon
her.
10.
The
agency
contract
is
valid.
However,
the
stipulation
excepting
the
agent
A
from
rendering
an
account
is
void,
as
provided
under
the
law.
Therefore,
A
is
not
correct.
He
cannot
rely
in
the
exemption
stipulated
in
the
agency
contract,
as
the
same
is
contrary
to
law.
11.
The
facts
show
that
P’s
employee,
the
mechanic,
is
the
one
supervising
the
operation
of
the
service
station.
It
is
the
mechanic’s
negligence
that
led
to
the
unfortunate
incident
that
broke
C’s
car.
Under
the
principle
of
vicarious
liability,
P
is
liable
for
the
mechanic’s
actions.
Of
course,
the
mechanic
should
be
held
liable
for
his
negligence
as
well.
A,
as
agent,
should
also
be
liable.
Facts
show
that
it
is
the
mechanic
who
supervises
the
operation
of
the
service
station,
and
that
A
should
only
be
selling
the
products
of
the
P
at
a
fixed
price.
Therefore,
A
and
his
personnel
have
no
business
placing
the
car
on
the
hydraulic
lifter
and
ordering
it
to
be
lifted.
Acting
beyond
his
authority,
A
should
likewise
be
liable.
12.
I’ll
stay
true
and
faithful
to
my
oath
as
a
lawyer.
Many
challenges
in
the
administration
of
justice
in
the
country
are
worsened,
if
not
caused
by
lawyers
who
sacrifice
their
reputation
and
integrity
for
easy
money.
I
believe
that
a
big
difference
will
take
place
if
a
new
breed
of
lawyers
will
come
in,
drawing
the
line
and
never
crossing
the
bounds
of
their
professional
ethics.