G.R. No.

167552             April 23, 2007

EUROTECH INDUSTRIAL TECHNOLOGIES, INC., Petitioner,
vs.
EDWIN CUIZON and ERWIN CUIZON, Respondents.

FACTS:

Eurotech is engaged in the business of providing various European industrial equipment for
customers here in the Philippines and one of its customers is “Impact Systems” owned by respondent ERWIN
Cuizon. Respondent EDWIN is the sales manager of Impact Systems. Respondents sought to buy from
Eurotech one unit of sludge pump valued at ₱250,000.00 with a down payment of (₱50,000.00). 4 When the
sludge pump arrived, Eurotech refused to deliver the same to respondents without their having fully settled
their indebtedness. Thus, EDWIN, general manager or Impact System, executed a Deed of Assignment of
receivables in favor of Eurotech, hence, the latter delivered to respondents the sludge pump. However,
despite the existence of the Deed of Assignment, Erwin still proceeded to collect from Toledo Power
Company. With this, Eurotech made several demands upon respondents to pay their obligations and the latter
was able to make partial payments to petitioner. Because of respondents’ failure to abide by final demand
letter, petitioner instituted a complaint for sum of money

ISSUE:
WON EDWIN exceeded his authority when he signed the Deed of Assignment thereby binding himself
personally to pay the obligations to petitioner.

RULING:
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 latter’s consent.
The elements of the contract of agency are: (1) consent, express or implied, of the parties to establish
the relationship; (2) the object is the execution of a juridical act in relation to a third person; (3) the agent
acts as a representative and not for himself; (4) the agent acts within the scope of his authority. 34
In this case, the parties do not dispute the existence of the agency relationship between respondents
ERWIN as principal and EDWIN as agent. Article 1897 reinforces the familiar doctrine that an agent, who acts
as such, is not personally liable to the party with whom he contracts. The same provision, however, presents
two 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. We hold that respondent
EDWIN does not fall within any of the exceptions contained in this provision.
We hold that Edwin Cuizon acted well-within his authority when he signed the Deed of Assignment.
There is no doubt that respondent EDWIN’s participation in the Deed of Assignment was "reasonably
necessary" or was required in order for him to protect the business of his principal. Had he not acted in the
way he did, the business of his principal would have been adversely affected and he would have violated his
fiduciary relation with his principal.
 G.R. No. 117356               June 19, 2000
VICTORIAS MILLING CO., INC.,
vs.
COURT OF APPEALS and CONSOLIDATED SUGAR CORPORATION

FACTS:
St. Therese Merchandising (hereafter STM) bought sugar from petitioner Victorias Milling Co., Inc.,
(VMC). STM sold to Consolidated Sugar Corporation (CSC) its rights to collect such bags of sugar. CSC
collected to the petitioner's NAWACO warehouse and was allowed to withdraw sugar. However, after initial
release of bags, petitioner refused to allow further withdrawals of sugar. It is only that CSC realized that STM
had already withdrawn all the sugar covered by the cleared checks. Hence, CSC filed a complaint for specific
performance,

ISSUE:
Whether or not agency exists between STM and CSC.

RULING:

No!
"Art. 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."
It is clear from Article 1868 that the basis of agency is representation. 17 On the part of the principal,
there must be an actual intention to appoint 18 or an intention naturally inferable from his words or
actions;19 and on the part of the agent, there must be an intention to accept the appointment and act on
it,20 and in the absence of such intent, there is generally no agency.
In the instant case, it appears that private respondent CSC was a buyer of the SLDFR form, and not an
agent of STM. Private respondent CSC was not subject to STM's control. The question of whether a contract is
one of sale or agency depends on the intention of the parties. The authorization given to CSC contained the
phrase "for and in our (STM's) behalf" did not establish an agency. Ultimately, what is decisive is the intention
of the parties.  No agency was meant to be established by the CSC and STM is clearly shown by CSC's
communication to petitioner that SLDR No. 1214M had been "sold and endorsed" to it. 27 The use of the words
"sold and endorsed" means that STM and CSC intended a contract of sale, and not an agency. Hence, on this
score, no error was committed by the appellate court when it held that CSC was not STM's agent and could
independently sue petitioner.
 G.R. No. L-40242 December 15, 1982

DOMINGA CONDE, petitioner,
vs.
THE HONORABLE COURT OF APPEALS, MANILA PACIENTE CORDERO, together with his
wife, NICETAS ALTERA, RAMON CONDE, together with his wife, CATALINA T.
CONDE, respondents.

The established facts, as found by the Court of Appeals, show that on 7 April 1938. Margarita
Conde, Bernardo Conde and the petitioner Dominga Conde, as heirs of Santiago Conde, sold with
right of repurchase, within ten (10) years from said date, a parcel of agricultural land located in
Maghubas Burauen Leyte, (Lot 840), with an approximate area of one (1) hectare, to Casimira
Pasagui, married to Pio Altera (hereinafter referred to as the Alteras), for P165.00. The "Pacto de
Retro Sale" further provided:

... (4) if at the end of 10 years the said land is not repurchased, a new agreement
shall be made between the parties and in no case title and ownership shall be vested
in the hand of the party of the SECOND PART (the Alteras).

xxx xxx xxx (Exhibit "B")

On 17 April 1941, the Cadastral Court of Leyte adjudicated Lot No. 840 to the Alteras "subject to the
right of redemption by Dominga Conde, within ten (10) years counting from April 7, 1983, after
returning the amount of P165.00 and the amounts paid by the spouses in concept of land tax ... "
(Exhibit "1"). Original Certificate of Title No. N-534 in the name of the spouses Pio Altera and
Casimira Pasagui, subject to said right of repurchase, was transcribed in the "Registration Book" of
the Registry of Deeds of Leyte on 14 November 1956 (Exhibit "2").

On 28 November 1945, private respondent Paciente Cordero, son-in-law of the Alteras, signed a
document in the Visayan dialect, the English translation of which reads:

MEMORANDUM OF REPURCHASE OVER A PARCEL OF LAND SOLD WITH

REPURCHASE WHICH DOCUMENT GOT LOST

WE, PIO ALTERA and PACIENTE CORDERO, both of legal age, and residents of
Burauen Leyte, Philippines, after having been duly sworn to in accordance with law
free from threats and intimidation, do hereby depose and say:

1. That I, PIO ALTERA bought with the right of repurchase two

parcels of land from DOMINGA CONDE, BERNARDO CONDE AND
MARGARITA CONDE, all brother and sisters.

2. That these two parcels of land were all inherited by the three.

3. That the document of SALE WITH THE RIGHT OF REPURCHASE

got lost in spite of the diligent efforts to locate the same which was
lost during the war.
 4. That these two parcels of land which was the subject matter of a
Deed of Sale with the Right of Repurchase consists only of one
document which was lost.

5. Because it is about time to repurchase the land, I have allowed the

representative of Dominga Conde, Bernardo Conde and Margarita
Conde in the name of EUSEBIO AMARILLE to repurchase the same.

6. Now, this very day November 28, 1945, 1 or We have received

together with Paciente Cordero who is my son-in-law the amount of
ONE HUNDRED SIXTY-FIVE PESOS (P165. 00) Philippine Currency
of legal tender which was the consideration in that sale with the right
of repurchase with respect to the two parcels of land.

That we further covenant together with Paciente Cordero who is my son-in-law that
from this day the said Dominga Conde, Bernardo Conde and Margarita Conde will
again take possession of the aforementioned parcel of land because they
repurchased the same from me. If and when their possession over the said parcel of
land be disturbed by other persons, I and Paciente Cordero who is my son-in-law will
defend in behalf of the herein brother and sisters mentioned above, because the
same was already repurchased by them.

IN WITNESS WHEREOF, I or We have hereunto affixed our thumbmark or signature

to our respective names below this document or memorandum this 28th day of
November 1945 at Burauen Leyte, Philippines, in the presence of two witnesses.

PIO ALTERA (Sgd.) PACIENTE CORDERO

WITNESSES:

1. (SGD.) TEODORO C. AGUILLON

To be noted is the fact that neither of the vendees-a-retro, Pio Altera nor Casimira Pasagui, was a
signatory to the deed. Petitioner maintains that because Pio Altera was very ill at the time, Paciente
Cordero executed the deed of resale for and on behalf of his father-in-law. Petitioner further states
that she redeemed the property with her own money as her co-heirs were bereft of funds for the
purpose.

The pacto de retro document was eventually found.

On 30 June 1965 Pio Altera sold the disputed lot to the spouses Ramon Conde and Catalina T.
Conde, who are also private respondents herein. Their relationship to petitioner does not appear
from the records. Nor has the document of sale been exhibited.

Contending that she had validly repurchased the lot in question in 1945, petitioner filed, on 16
January 1969, in the Court of First Instance of Leyte, Branch IX, Tacloban City, a Complaint (Civil
Case No. B-110), against Paciente Cordero and his wife Nicetas Altera, Ramon Conde and his wife
Catalina T. Conde, and Casimira Pasagui Pio Altera having died in 1966), for quieting of title to real
property and declaration of ownership.
Petitioner's evidence is that Paciente Cordero signed the Memorandum of Repurchase in
representation of his father-in-law Pio Altera, who was seriously sick on that occasion, and of his
mother-in-law who was in Manila at the time, and that Cordero received the repurchase price of
P65.00.

Private respondents, for their part, adduced evidence that Paciente Cordero signed the document of
repurchase merely to show that he had no objection to the repurchase; and that he did not receive
the amount of P165.00 from petitioner inasmuch as he had no authority from his parents-in-law who
were the vendees-a-retro.

After trial, the lower Court rendered its Decision dismissing the Complaint and the counterclaim and
ordering petitioner "to vacate the property in dispute and deliver its peaceful possession to the
defendants Ramon Conde and Catalina T. Conde".

On appeal, the Court of Appeals upheld the findings of the Court a quo that petitioner had failed to
validly exercise her right of repurchase in view of the fact that the Memorandum of Repurchase was
signed by Paciente Cordero and not by Pio Altera, the vendee-a-retro, and that there is nothing in
said document to show that Cordero was specifically authorized to act for and on behalf of the
vendee a retro, Pio Altera.

Reconsideration having been denied by the Appellate Court, the case is before us on review.

RULING:

There is no question that neither of the vendees-a-retro signed the "Memorandum of Repurchase",
and that there was no formal authorization from the vendees for Paciente Cordero to act for and on
their behalf.

Of significance, however, is the fact that from the execution of the repurchase document in 1945,
possession, which heretofore had been with the Alteras, has been in the hands of petitioner as
stipulated therein. Land taxes have also been paid for by petitioner yearly from 1947 to 1969
inclusive (Exhibits "D" to "D-15"; and "E"). If, as opined by both the Court a quo and the Appellate
Court, petitioner had done nothing to formalize her repurchase, by the same token, neither have the
vendees-a-retro done anything to clear their title of the encumbrance therein regarding petitioner's
right to repurchase. No new agreement was entered into by the parties as stipulated in the deed
of pacto de retro, if the vendors a retro failed to exercise their right of redemption after ten years. If,
as alleged, petitioner exerted no effort to procure the signature of Pio Altera after he had recovered
from his illness, neither did the Alteras repudiate the deed that their son-in-law had signed. Thus, an
implied agency must be held to have been created from their silence or lack of action, or their failure
to repudiate the agency. 2

Possession of the lot in dispute having been adversely and uninterruptedly with petitioner from 1945
when the document of repurchase was executed, to 1969, when she instituted this action, or for 24
years, the Alteras must be deemed to have incurred in laches. 3 That petitioner merely took advantage
of the abandonment of the land by the Alteras due to the separation of said spouses, and that petitioner's
possession was in the concept of a tenant, remain bare assertions without proof.

Private respondents Ramon Conde and Catalina Conde, to whom Pio Altera sold the disputed
property in 1965, assuming that there was, indeed, such a sale, cannot be said to be purchasers in
good faith. OCT No. 534 in the name of the Alteras specifically contained the condition that it was
subject to the right of repurchase within 10 years from 1938. Although the ten-year period had
lapsed in 1965 and there was no annotation of any repurchase by petitioner, neither had the title
been cleared of that encumbrance. The purchasers were put on notice that some other person could
have a right to or interest in the property. It behooved Ramon Conde and Catalina Conde to have
looked into the right of redemption inscribed on the title, and particularly the matter of possession,
which, as also admitted by them at the pre-trial, had been with petitioner since 1945.

Private respondent must be held bound by the clear terms of the Memorandum of Repurchase that
he had signed wherein he acknowledged the receipt of P165.00 and assumed the obligation to
maintain the repurchasers in peaceful possession should they be "disturbed by other persons". It
was executed in the Visayan dialect which he understood. He cannot now be allowed to dispute the
same. "... If the contract is plain and unequivocal in its terms he is ordinarily bound thereby. It is the
duty of every contracting party to learn and know its contents before he signs and delivers it." 4

There is nothing in the document of repurchase to show that Paciente Cordero had signed the same
merely to indicate that he had no objection to petitioner's right of repurchase. Besides, he would have had
no personality to object. To uphold his oral testimony on that point, would be a departure from the parol
evidence rule 5 and would defeat the purpose for which the doctrine is intended.

... The purpose of the rule is to give stability to written agreements, and to remove
the temptation and possibility of perjury, which would be afforded if parol evidence
was admissible. 6

In sum, although the contending parties were legally wanting in their respective actuations, the
repurchase by petitioner is supported by the admissions at the pre-trial that petitioner has been in
possession since the year 1945, the date of the deed of repurchase, and has been paying land taxes
thereon since then. The imperatives of substantial justice, and the equitable principle of laches
brought about by private respondents' inaction and neglect for 24 years, loom in petitioner's favor.

WHEREFORE, the judgment of respondent Court of Appeals is hereby REVERSED and SET
ASIDE, and petitioner is hereby declared the owner of the disputed property. If the original of OCT
No. N-534 of the Province of Leyte is still extant at the office of the Register of Deeds, then said
official is hereby ordered to cancel the same and, in lieu thereof, issue a new Transfer Certificate of
Title in the name of petitioner, Dominga Conde.
 G.R. No. 85302 March 31, 1989
BICOL SAVINGS AND LOAN ASSOCIATION, petitioner,
vs.
HON. COURT OF APPEALS, CORAZON DE JESUS, LYDIA DE JESUS, NELIA DE JESUS, JOSE DE JESUS, AND
PABLO DE JESUS, respondents.

FACTS:
Juan de Jesus was the owner of a parcel of land in Naga City. He executed a Special Power of Attorney
in favor of his son, Jose de Jesus authorizing the latter to negotiate and mortgage the said real property in any
bank. By virtue thereof, Jose de Jesus obtained a loan of (P20,000.00) from Bicol Savings and Loan Assoc. To
secure payment, Jose de Jesus executed a deed of mortgage on the real property referred to in the Special
Power of Attorney. Juan de Jesus died subsequently, thereby failing to pay the loan obligation, hence the bank
caused the mortgage to be extrajudicially foreclosed. The heirs of Juan failed to redeem the property. The
heirs filed a complaint for annulment of the foreclosure, however the trial court dismissed the same. On
appeal, the appellate court reversed such ruling, applying Article 1879 of the Civil Code and stated that since
the special power to mortgage granted to Jose de Jesus did not include the power to sell, because the Special
Power of Attorney given by Juan de Jesus to Jose de Jesus was merely to mortgage his property, and not to
extrajudicially foreclose the mortgage and sell the mortgaged property in the said extrajudicial foreclosure.

ISSUE:
WON the agent-son exceeded the scope of his authority in having the property mortgaged sold
extrajudicially?

RULING:
NO, the agent did not exceed the scope of his authority. Article 1879 of the Civil Code, relied on by the
Appellate Court, is not applicable in this case.

The sale proscribed by a special power to mortgage under Article 1879 is a voluntary and
independent contract, and not an auction sale resulting from extrajudicial foreclosure, which is precipitated
by the default of a mortgagor. Absent that default, no foreclosure results. The stipulation granting an
authority to extra judicially foreclose a mortgage is an ancillary stipulation supported by the same cause or
consideration for the mortgage and forms an essential or inseparable part of that bilateral agreement.
The power to foreclose is not an ordinary agency that contemplates exclusively the representation of
the principal by the agent but is primarily an authority conferred upon the mortgagee for the latter's own
protection. That power survives the death of the mortgagor. In fact, the right of the mortgagee bank to extra
judicially foreclose the mortgage after the death of the mortgagor Juan de Jesus, acting through his attorney-
in-fact, Jose de Jesus, did not depend on the authorization in the deed of mortgage executed by the latter. That
right existed independently of said stipulation and is clearly recognized under the Rules of Court.
 G.R. No. L-28633 March 30, 1971
CENTRAL SURETY and INSURANCE COMPANY, petitioner,
vs.
C. N. HODGES and THE COURT OF APPEALS, respondents.

FACTS:
C. N. Hodges sold to Vicente M. Layson parcels of land located in Negros, In order that he could use
said lots as security for a loan he intended to apply from a bank, Layson persuaded Hodges to execute in his
(Layson's) favor a deed of absolute sale over the properties, with the understanding that he would put up a
surety bond to guarantee the payment of said balance. Accordingly, the Central Surety and Insurance
Company, through its manager of Iloilo branch, Mrs. Rosita Mesa, executed in favor of Hodges the said surety
bond. When Layson defaulted in the discharge of his aforesaid obligation, Hodges demanded payment from
the petitioner, which, despite repeated extensions of time granted thereto, at its request, failed to honor its
commitments under the surety bond. Hence, Hodges filed an action. Petitioner disclaimed liability under the
surety bond in question, upon the ground that the same is null and void, it having been issued by Mrs. Rosita
Mesa after her authority therefor had been withdrawn on March 15, 1952.

ISSUE:
WON there was a sufficient revocation of the agency.

RULING:
There is none. Article 1922 of our Civil Code provides that, “If the agent had general powers,
revocation of the agency does not prejudice third persons who acted in good faith and without knowledge of
the revocation. Notice of the revocation in a newspaper of general circulation is a sufficient warning to third
persons.”
It is not disputed that petitioner has not caused to be published any notice of the revocation of Mrs.
Mesa's authority to issue surety bonds on its behalf, notwithstanding the fact that the powers of Mrs. Mesa, as
its branch manager in Iloilo, were of a general nature, for she had exclusive authority, in the City of Iloilo, to
represent petitioner herein, not with a particular person, but with the public in general. Article 1922 applies
whenever an agent has general powers, not merely when the principal has published the same, apart from the
fact that the opening of petitioner's branch office amounted to a publication of the grant of powers to the
manager of said office. Then, again, by honoring several surety bonds issued in its behalf by Mrs. Mesa
subsequently to March 15, 1952, petitioner induced the public to believe that she had authority to issue such
bonds. As a consequence, petitioner is now estopped from pleading, particularly against a regular customer
thereof, like Hodges, the absence of said authority.