Article Definition of Contract of Agency

1868
1869 Express or Implied
1870 Acceptance: Express or Implied
1871 When both are present
1872 When both are absent
1873 Especially Inform/ Public Advertisements
1874 Sale of Piece of Land
1875 Presumed for Compensation
1876 General/Special
1877 Couched in General Terms
1878 Special Power of Attorney
1879 Sell excludes Mortgage
1880 Compromise not include submission to Arbitration
1881 Within the Scope of His Authority
1882 Advantageous to the Principal
1883 Agent acts in his own name
OBLIGATION OF THE AGENT

1884 Bound by his acceptance

1885 Agent Declines ( Diligence of a Good Father)
1886 Advance necessary funds if there is stipulation unless INSOLVENT
1887 In accordance with the instruction of the Principal
1888 Should not carry out if would result to loss or damage to he Principal
1889 Liable for Damages if he Choses his OWN INTEREST.
1890 Borrow Money
1891 Accounting
1892 Substitution
1893 Principal may Bring ACTION against the substitute
1894 Not Solidary
1895 If SOLIDARITY has been agreed upon
1896 Interest
1897 Agent binds himself
1898 3RD PERSONS AWARE of LIMITATION of Agents
1899 Ignorance of Agent
1900 Within the scope of authority is written even if the agent has in fact exceeded the limits of
his actual authority according to the secret understanding between him and the principal.
1901 Agency by ratification.
1902 Third persons may require the presentation of power of attorney
1903 Commission agent responsible for the goods received by him, if there is damage he should
make a written statement.
1904 Countermark of Goods to distinguish goods of the same kind and mark.
1905 Commission agent cannot, without the express or implied consent of the principal sell on
credit.
1906 If authorized, he shall inform the Principal of the Sale on Credit
1907 Guarantee Commission, he shall bear the risk of collection and pay the principal the
proceeds of the sale. The purpose of guarantee commission is to compensate the agent for
the risks he will have to bear in the collection of the credit due the principal.
1908 If he does not collect when they become due and demandable he shall be liable for
damages unless he proves that he exercised due diligence.
1909 Agent if responsible for either fraud or negligence. Courts will determine liability in
negligence whether it was or was not for a compensation.
OBLIGATION OF THE PRINCIPAL
1910 Specific Obligations of the Principal
1. Comply with all the obligations.
2. Advance the agents the sums necessary for the execution of agency.
3. To reimburse the agent for all the advances
4. To indemnify the agent for damages in the execution of agency without the fault
or negligence of the agent.
1911 Agency by Estoppel
1912 Reimbursement Even if the business or undertaking was not successful provided that the
agent is free from all fault.
 1913 Obligation to Indemnify Agent for Damages
1914 RIGHT of Agent to retain object of agency in PLEDGE.
1915 Principals are solidarily liable to agency.
1916 2 persons contract separately with agent and principal - that of prior date shall be
preferred.
1917 In 1916, if the agent acted in good faith, the principal will be liable to the third persons.
1918 Cases where principal is not liable to the agent:
1. Agent acted in contravention of the principals instruction.
2. Expenses due to the fault of the agent.
3. Agent incurred them with the knowledge that unfavorable result would ensue.
4. When it was stipulated.
MODES OF EXTINGUISHMENT OF AGENCY
1919 Expiration, Death, Withdrawal, Accomplishment, Revocation, Dissolution
1920 Agency Generally Revocable at Will.
1921 Revocation will not prejudice such third persons until notice thereof is given them.
(Contracted with Specified Persons)
1922 Notice of the Revocation in newspaper of general circulation is sufficient warning to third
persons.
(General Public)
1923 Revocation of agency by appointment of new agent with notice to the former agent.
1924 Agency is revoked if the principal directly manages the business entrusted to the agent
1925 Any of the two or more principals may revoke the agency.
1926 GPA is revoked by SPA
1927 Agency is irrevocable when:
1. Bilateral Contract depends on it.
2. Fulfilling an obligation already contracted.
3. A partner is appointed manager of partnership and his removal is unjustifiable.
1928 Withdrawal of agent
1929 When the agent withdraws, he must continue to act until the principal has had reasonable
opportunity to take the necessary steps to meet the situation.
1930 Death of Principal does not terminate agency if:
1. Agency has been constituted in the common interest of principal and agent
2. Constituted in the interest of a third person.
1931 Anything done by the agent without the knowledge of death or principal or other causes
which extinguishes the agency is valid to third persons who have acted in good faith.
1932 If agent dies, heirs must notify and adopt measures as the circumstance may demand for
the interest of the principal.
(Agency by Operation of Law) Temporary Only Contract of Agency is Personal
Confidence.

The basis for agency is representation.

Where a person deals with an agent, he shoulders the risk of transacting with the latter.
He is put upon inquiry and must discover upon his peril the authority of the agent.