Ateneo notes (2002)

AGENCY
Definition: 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.
(Article 1868)
Characteristics: 1. consensual . principal
!. nominate ". unilateral# reciprocal (if for compensation)
$. preparatory
Nature: %ince it is a contract, there must be a meeting of the minds as to consent, ob&ect, and
cause.
Basis: Representation . 'he acts of the agent on behalf of the principal within the scope of his
authority produce the same legal and binding effects as if they were personally done by the
principal.
(ence, the distinguishing features of agency are its representative character ) its derivative
authority.
Purpose: e*tend the personality of the principal through the facility of the agent
Capacity of the Parties:
'he principal may be a natural or a &uridical person. And he must be capacitated. 'he rule is if a
person is capacitated to act for himself or his own right, he can act through an agent.
As to the agent, insofar as the third persons are concerned, it is enough that the principal is
capacitated. But insofar as his obligations to his principal are concerned, the agent must be able
to bind himself.
Essential Elements:
1. consent of the parties to establish the relationship#
2. ob&ect of the contract is the e*ecution of a &uridical act in relation to third persons#
3. agent acts as a representative and not for himself# and
4. agent acts within the scope of his authority
Acts hat Cannot Be Done By A!ent
(1) +ersonal Acts
1
(!) ,riminal or -llegal Acts
Nature of Relationship Between Principal & Agent: .iduciary, based on trust ) confidence
Distinction Between Agency & Lease of Service
A!ency "ease of #er$ice
Basis representation employment
+owers ) functions agent e*ercises discretionary
powers
lessor ordinarily performs only
ministerial functions
+ersons involved $ persons/ principal, agent and the
$
rd
person with whom the agent
contracts
! persons/ lessor and lessee
'ypes of transactions
involved
relates to commercial or business
transactions
relates more to the matters of
mere manual or mechanical
e*ecution
Distinction Between Agency & Guardianship
A!ency Guar%ianship
Agent represents a capacitated person A guardian represents an incapacitated person.
Agent is appointed by the principal and can be
removed by the latter.
0uardian is appointed by the court and stands
in loco parentis.
Agent is sub&ect to the directions of the
principal.
0uardian is not sub&ect to the directions of the
ward but must act for the benefit of the latter
Agent can ma1e the principal personally liable. 0uardian has no power to impose personal
liability on the ward.
Distinction Between Agency & Lease of Property
A!ency "ease of property
Agent is controlled by the principal. 2essee is not controlled by the lessor.
Agency may involve things other than property. 2ease of property involves property..
Agent can bind the principal. 2essee cannot bind the lessor.
2
Distinction Between Agency to Sell & Sale
A!ency to sell #ale
Agent receives the goods as the principal3s
goods
Buyer receives the goods as owner
Agent delivers the proceeds of the sale Buyer pays the price
Agent can return the ob&ect in case he is unable
to sell the same to a third person
Buyer, as a general rule, cannot return the
ob&ect sold
Agent in dealing with the thing received is
bound to act according to the instructions of his
principal
Buyer can deal with the thing as he pleases,
being the owner
Distinction Between Agent & ontractor
A!ent &n%epen%ent Contractor
represents his principal employed by the employer
acts under the principal3s control and instruction acts according to his own method
principal is liable for torts committed by the
agent within the scope of his authority
employer not liable for torts committed by the
independent contractor.
Classification of A!ency
A! As to "anner of creation
1. Express agent has been actually authori4ed by the principal, either orally or in
writing
2. Implied 5 agency is implied from the acts of the principal, from his silence or lac1
of action or his failure to repudiate the agency 1nowing that another person is
acting on his behalf without authority, or from the acts of the agent which carry
out the agency, or from his silence or inaction according to the circumstances
B! As to character
3
1. Gratuitous 5 agent receives no compensation for his services
2. Onerous agent receives compensation for his services
3. As to e#tent of $usiness of the principal
4. General 5 agency comprises all the business of the principal
5. Special 5 agency comprises one or more specific transactions
6. As to authority conferred
7. Couched in general terms 5 agency is created in general terms and is deemed to
comprise only acts in the name and representation of the principal
8. Simple or Commission 5 agent acts in his own name but for the account of the
principal
'orm of A!ency:
GR: appointment of an agent may be oral or written# no formal re6uirements
%#ception: when the law re6uires a specific form (e.g. agent3s sale of real property or any
interest therein)
'orm of Acceptance (y A!ent
A. Express 7 when it is oral or written
B. Implied -when it can be inferred from the acts of the agent which carry out the agency, or
from his silence of inaction according to the circumstances
1. Between persons who are present 5 implied acceptance if the principal delivers
his power of attorney to the agent and the latter receives it without any ob&ection
!. Between persons who are absent 5 acceptance not deemed implied from the
silence of the agent ECE!"/
a. 8hen the principal transmits his power of attorney to the agent, who receives it
without any ob&ection

b. 8hen 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
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)ay of Gi$in! Notice of A!ency * &ts Effect
1. B# special in$ormation 7 the person appointed as agent is considered such with respect to
the person to whom it was given
!. B# public ad%ertisement 7 the agent is considered such with regard to any person
Po+er of Attorney:
instrument in writing by which one person, as principal, appoints another as his agent and
confers upon him the authority to perform certain specified acts or 1inds of acts on behalf of the
principal# primary purpose is to evidence agent3s authority to third parties within whom the agent
deals
Po+er of Attorney, -o+ Construe%:
GR: strictly construed and strictly pursued# held to grant only those specified powers
%#ception: when strict construction will destroy the very purpose of the power
Sale of a Piece of Land&Any 'nterest (herein: agent3s authority must be in writing, otherwise
sale is void
A!ency Couche% in General erms:
covers only 9:;: A,'% <. A=9->-%';A'-<> e%en i$
a. the principal should state that he withholds no power
b. the agent may e*ecute such acts as he may consider appropriate
c. the agency should authori4e a general and unlimited management
#pecial Po+ers of Attorney
1. 'o ma1e such payments as are not usually considered as acts of administration
!. 'o effect novations which put an end to obligations already in e*istence at the time the
agency was constituted
$. 'o compromise, to submit 6uestions to arbitration, to renounce the right to appeal from a
&udgment, to waive ob&ections to the venue of an action or to abandon a prescription
already ac6uired
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. 'o waive any obligation gratuitously
". 'o enter into any contract by which the ownership of an immovable is transmitted or
ac6uired either gratuitously or for a valuable consideration
6. 'o ma1e gifts, e*cept customary ones for charity or those made to employees in the
business managed by the agent
?. 'o loan or borrow money, unless the latter act be urgent and indispensable for the
preservation of the things which are under administration
8. 'o lease any real property to another person for more than one year
@. 'o bind the principal to render some service without compensation
1A. 'o bind the principal in a contract of partnership
11. 'o obligate the principal as a guarantor or surety
1!. 'o create or convey real rights over immovable property
1$. 'o accept or repudiate an inheritance
1. 'o ratify or recogni4e obligations contracted before the agency
1". Any other act of strict dominion
Not 'ncluded in the Power to )ortgage:
1. to sell
!. to e*ecute a second mortgage
$. to mortgage for the agent3s or any $
rd
persons3 benefit, B>2:%% clearly indicated
!ower to compromise does not include submission to arbitration.
%ffects of Acts of Agent
AC# .' -E AGEN E''EC E/CEP&.N0#
1. in behalf of the principal,
within the scope of authority
binds principal# agent not
personally liable
agent liable if he (1)e*pressly
ma1es himself liable#
(!)e*ceeds the limits of his
authority without giving the
parties sufficient notice of his
powers
!. without or beyond scope of
authority
contract is unenforceable as
against the principal but binds
the agent to the third person
binding on the principal when
ratified or when the principal
allowed the agent to act as
6
though he had full powers
$. within the scope of
authority but in the agent3s
name
not binding on the principal#
principal has no cause of
action against the $
rd
parties
and vice versa
when the transaction involves
things belonging to the
principal
1. remedy of the principal 7
damages for agent3s failure to
comply with the agency
!. remedy of the third person 7
-f the case falls under the
general rule, he can sue the
agent. But when the contract
involves things belonging to
the principal, he can sue the
principal. But if it cannot be
determined without litigation
who is liable, he can sue both.
. within the scope of the
written power of attorney but
agent has actuall# e*ceeded
his authority according to an
understanding between him )
the principal
insofar as $
rd
persons are
concerned (not re6uired to
in6uire further than the terms
of the written power, agent
acted within scope of his
authority# principal estopped
". with improper motives motive is immaterial# as long
as within the scope of
authority, valid
(1)$
rd
person 1new agent was
acting for his own benefit/
principal is not liable to $
rd
third person (!) owner is
see1ing recovery of personal
property of which he has been
unlawfully deprived
6. with misrepresentations by
the agent
a. authori4ed 7 principal still
liable
b. beyond the scope of the
agent3s authority
GR/ principal not liable
Exception/ principal ta1es
advantage of a contract or
receives benefits made under
false representation of his
agent
c. for the agent3s own benefit
5 principal still liable# agent3s
motive immaterial
?. mismanagement of the
business by the agent
principal still responsible for
the acts contracted by the
agent with respect to $
rd
persons# principal, however,
7
may see1 recourse from the
agent
8. tort committed by the agent principal civilly liable so long
as the tort is committed by the
agent while performing his
duties in furtherance of the
principal3s business
@. agent in good faith but
pre&udices $
rd
parties
principal is liable for damages
1A. agent in bad faith and
pre&udices $
rd
persons
only the agent is liable for
damages
N.E: Agent always liable $or $raud but not $or negligence, which shall be &udged with more or
less rigor by the courts, according to whether the agency was or was not for a compensation.
.(li!ations of the A!ent to the Principal
(a) GENE1A":
1. act with utmost good faith ) loyalty for the furtherance of principal3s interests

!. obey principal3s instructions

$. e*ercise reasonable care
(b) #PEC&'&C:
1. carry out the agency
!. answer for damages which through his non7performance the principal may suffer
$. finish the business already begun on the death of the principal should delay entail any danger
(exception to the rule that death e*tinguishes agency)
. observe the diligence of a good father in the custody and preservation of the goods forwarded
to him by the owner in case he declines an agency, until an agent is appointed
". advance necessary funds if there be a stipulation to do so (except when the principal is
insolvent)
6. act in accordance with the instructions of the principal, and in default thereof, to do all that a
good father of a family would do (&O"E/ A departure $rom the principal's instructions may
be &ustified by a sudden emergency, or if the instructions are ambiguous, or if the departure is
so insubstantial that it does not affect the result and the principal suffers no damage thereby.
.urther, an agent has the right to disobe# the principal3s instructions when the instruction
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calls for the performance of illegal acts, or where he is privileged to do so to protect his
security interest in the sub&ect matter of the agency.)
?. not to carry out the agency if it would manifestly result in loss or damage to the principal
8. answer for damages if there being a conflict between his ) principal3s interests, he prefers
his own
@. not to loan to himself if he has been authori4ed to loan money at interest
1A. render an account of his transactions and deliver to the principal whatever he may have
received by virtue of the agency (-f the agent fails to deliver and instead converts or
appropriates for his own use the money or property belonging to his principal, he may be
charged with ES"()(.)
11. be responsible in certain cases for the act of the substitute appointed by him
1!. pay interest on funds he has applied to his own use
Distinction Between Authority and the Principal*s 'nstructions
A2-.1&Y &N#12C&.N#
sum total of the powers committed to the agent
by the principal
contemplates only a private rule of guidance to
the agent# independent and distinct in character
relates to the sub&ectCbusiness with which the
agent is empowered to deal or act
refers to the manner or mode of agent3s action
limitations of authority are operative as against
those who haveCcharged with 1nowledge of
them
without significance as against those with
neither 1nowledge nor notice of them
contemplated to be made 1nown to third
persons dealing with the agent
not e*pected to be made 1nown to those with
whom the agent deals
Appoint"ent of Su$+agent:
1. -f there is no prohibition from the principal and the agent appoints a subagent, the agent
is responsible for all the acts of the subagent.
!. -f there is a prohibition but nevertheless the agent appoints a subagent, all the subagent3s
acts are void as to the principal.
$. -f there is authority to appoint and subagent is not designated by the principal, the agent
will be liable for all the acts of the subagent if the subagent is notoriously incompetent or
insolvent.
. -f there is authority to appoint and subagent is designated by the principal, the agent is
released from any liability from the acts of the subagent.
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1esponsi(ility of 2 or 3ore A!ents Appointe% #imultaneously:
GR: liable &ointly
%#ception: solidarity has been e*pressly stipulated# each of the agents becomes solidarily liable
for (1) the non7fulfillment of the agency# of for (!) the fault or negligence of his fellow agent
%#ception to the e#ception: when one of the other agentCs acts beyond the scope of his authority
5 innocent agent is ><' liable
><': however that if two or more persons have appointed an agent for a common transaction or
underta1ing, they shall be solidaril# liable to the agent for all the conse6uences of the agency.
Any of them also revo1e the agency.
Bro,er: negotiate contracts relative to property in behalf of others and for a compensation or fee
-hen Bro,er %ntitled to o"pensation: whenever he brings to his principal a party who is able
and willing to ta1e the property, and enter into a valid contract upon the terms named by the
principal, although the particulars may be arranged and the matter negotiated and completed
between the principal and the purchaser directly (><':/ A bro1er is never entitled to
commission for unsuccessful efforts.)
"a+ on Dou(le A!ency:
disapproved by law for being against public policy and sound morality ECE!" where the agent
acted with full 1nowledge and consent of the principals
o"pensation for a Dou$le Agent:
a. with *nowledge o$ both principals 7 recovery can be had from both principals
b. without the *nowledge o$ both principals - the agent can recover from neither
c. with *nowledge o$ one principal 7 as to the principal who 1new of that fact and as to
the agent, they are in pari delicto and the courts shall leave them as they were, the
contract between them being void as against public policy and good morals
Attorney4&n4'act:
one who is given authority by his principal to do a particular act not of a legal character
N.E: 'he term is, in loose language, used to include agents of all 1inds, but in its strict sense,
it means an agent having a special authority created by a deed.
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GENE1A" AGEN #PEC&A" AGEN
%cope of Authority all acts connected with the
business or employment in
which he is engaged
specific acts in pursuance of
particular instructions or with
restrictions necessarily implied
from the act to be done
>ature of %ervice Authori4ed involves continuity of service no continuity of service
:*tent to 8hich Agent 9ay
Bind the +rincipal
may bind his principal by an
act within the scope of his
authority although it may be
contrary to the latter3s special
instructions
can not bind his principal in a
manner beyond or outside the
specific acts which he is
authori4ed to perform
'ermination of Authority apparent authority does not
terminate by the mere
revocation of his authority
without notice to the third
party
duty imposed upon the third
party to in6uire ma1es
termination of the relationship
as between the principal and
agent effective as to such third
party unless the agency has
been entrusted for the purpose
of contracting with such third
party
,onstruction of +rincipal3s
-nstructions
merely advisory in nature strictly construed as they limit
the agent3s authority
Commission A!ent:
one whose business is to receive and sell goods for a commission and who is entrusted by the
principal with the possession of goods to be sold, and usually selling in his own name
Distinction Between .rdinary Agent & o""ission Agent
.r%inary a!ent Commission a!ent
acts for and in behalf of his principal act on his own name or in that his principal
need not have possession of principal3s goods must be in possession of the goods
Distinction Between o""ission Agent & Bro,er
Commission a!ent Bro5er
11
engaged in the purchase and sale for a principal
of personal property which has to be placed in
his possession and disposal
no custody or possession of the thing he
disposes# merely a go7between, an
intermediary between the sellers and the buyer
has a relation with principal, buyers or sellers,
and property which is the ob&ect of the
transaction
maintains no relation with the thing which he
purchases or sells
.(li!ations of a Commission A!ent
1. responsible for the goods received by him, as described in the consignment, +&,ESS
upon receiving them he should ma1e a written statement of the damage and deterioration
suffered by the same
!. if goods are of the same 1ind and mar1 but belonging to different owners, ma1e a
distinction by counter mar1s and designate the merchandise respectively belonging to each
principal
$. cannot, without consent of the principal, sell on credit# should he do, principal may
demand payment in cash, but the commission agent entitled to any interestCbenefit which may
result from such sale
. if a del credere agent receiving guarantee commission, bears the ris1 of collection and
pay the principal the proceeds of the sale on the same terms agreed upon with the purchaser
". liable for damages if agent does not collect the credits of his principal at the time when
they become due and demandable, B>2:%% he proves, that he e*ercised due diligence for that
purpose
.(li!ations of the Principal to the A!ent
1. comply with all the obligations agent contracted in representation of the principal
!. advance sums necessary for the e*ecution of the agency, when agent so re6uests# liable
for reimbursement regardless of the underta1ing3s success whenever agent had advanced
) has no fault# includes interest
$. reimburse the agent for all advances made by him provided the agent is free from fault
. indemnify the agent for all the damages which the e*ecution of the agency may have
caused the latter without fault or negligence on his part
". pay the agent the compensation agreed upon or the reasonable value of the latter3s
services
12
A!ent6s 1i!ht of 1etention:
speci$ic (only for those goods connected with the agency) and until the principal effects the
reimbursement and pays the indemnity
Principal6s "ia(ility for E7penses:
GR: principal liable for the e*penses incurred by the agent
%#ceptions:
1. -f the agent acted in contravention of the principalDs instructions, unless principal derives
benefits from the contract
!. 8hen the e*penses were due to the fault of the agent
$. 8hen the agent incurred them with 1nowledge that an unfavorable result would ensure, if the
principal was not aware thereof
. 8hen it was stipulated that the e*penses would be borne by the agent, or that the latter would
be allowed only a certain sum
A!ency (y Estoppel:
there is no agency at all, and the alleged agent seemed to have apparent or ostensible, although
not real authority to represent another
-ho can $e under estoppel to deny agency/
(1) Estoppel o$ (gent7 one professing to act as agent estopped to deny his agency both as
against his asserted principal and the third persons interested in the transaction in which he is
engaged
-./ Estoppel b# the !rincipal
a. a. (s to agent 5 one 1nowing another is acting as his agent and fails to repudiate his acts,
or
b. accept the benefits of them, will be estopped to deny the agency as against such other
c. (s to sub-agent 5 to estop the principal from denying his liability to a third
person, he must have 1nown or be charged with 1nowledge of the transaction and the
terms of the agreement between the agent and sub7agent
d. (s to third persons 5 one who 1nows that another is acting as his agent or
permitted another to appear as his agent, to the in&ury of third persons who have dealt
13
with the apparent agent as such in good faith and in the e*ercise of reasonable prudence,
is estopped to deny the agency
($) Estoppel o$ "hird !ersons 5 a third person, having dealt with one as an agent may be
estopped to deny the agency as against the principal, agent or $
rd
persons in interest
() Estoppel o$ the Go%ernment - government neither estopped by the mista1eCerror of its
agents# may be estopped through affirmative acts of its officers acting within the scope of
their authority
Con%itions for 1atification
1. 'he principal must have capacity and power to ratify
!. (e must have had 1nowledge of material facts
$. (e must ratify the acts in its entirety
. 'he act must be capable of ratification
". 'he act must be done in behalf of the principal
E 'o be effective, ratification need not be communicated or made 1nown to the agent or the third
party. 'he act or conduct of the principal rather than his communication is the 1ey. But before
ratification, the third party is free to revo1e the unauthori4ed contract.
Effects of 1atification
a. with respect to agent 7 relieves the agent from liability to the third party for the
unauthori4ed transaction, and to his principal for acting without authority# may recover
compensation
b. with respect to principal 7 assumes responsibility for the unauthori4ed act, as fully
as if the agent had acted under original authority but not liable for acts outside the authority
approved by his ratification
c. with respect to 0
rd
persons 7 bound by ratification to the same e*tent as if the
ratified act had been authori4ed# cannot raise the 6uestion of the agent3s authority to do the
ratified act
Distinction Between Ratification & %stoppel
1atification Estoppel
rests on intention rests on pre&udice
affects the entire transaction from the beginning affects only relevant parts of the transaction
substance of ratification is confirmation of an substance of estoppel is the principal3s
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authori4ed acts or conduct after it has been done inducement to another to act to his pre&udice
Distinction Between Apparent Authority & Authority $y %stoppel
Apparent Authority Authority (y Estoppel
though not actually granted, principal
1nowingly permitsCholds out the agent as
possessing the necessary powers to act in a
certain way
where the principal, by his negligence, permits
his agent to e*ercise powers not granted to him,
even though the principal may have no notice or
1nowledge of the conduct of the agent

3o%es of E7tin!uishment of A!ency
1. revocation
!. withdrawal of the agent
$. death, civil interdiction, insanity or insolvency of the principal or of the agent
. dissolution of the firm or corporation which entrusted or accepted the agency
". accomplishment of the ob&ect or purpose of the agency
6. e*piration of the period for which the agency was constituted
N.E: list not e*clusive# causes particular only to agency# may be e*tinguished by the modes
of e*tinguishment of obligations in general whenever they are applicable, li1e loss of the thing
and novation
Agency is ':;9->A':=, as a matter of law, upon the outbrea1 of war.

Presu"ption of ontinuance of Agency:
-t means that when once shown to have e*isted, an agency relation will be presumed to have
continued, in the absence of anything to show its termination.
ontinuance of Agency: parties must be (1)present, (!) capacitated and ($) solvent

E7ceptions to E7tin!uishment (y Death
1. if the agency is coupled with an interest
!. if the act of the agent was e*ecuted without the 1nowledge of the death of the principal
and the third person who contracted with the agent acted in good faith
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$. to avoid damage
. if it has been constituted in the common interest of the principal and of the agent, or in
the interest of a third person who has accepted the stipulation in his favor
Can the heirs continue the a!ency8
GR: agency calls for personal services on the part of the agent# rights ) obligations
intransmissible
%#ception:
1. agency by operation of law, or a presumed or tacit agency
!. agency is coupled with an interest in the %9 of the agency (e*. power of sale in a mortgage)
E7ceptions to E7tin!uishment 2pon "oss or Destruction of #u(9ect 3atter
1. if it is possible to substitute other material for that which was destroyed without
substantial detriment to either party or if the destroyed sub&ect matter was not in fact
essential to the contract#
!. a partial loss or destruction does not always result in a complete termination of the
agency, and under such circumstances, while the agency may be ended in so far as the
destroyed property is concerned, it may continue in e*istence as to other property not
affected
N.E: -f the loss brought about by the principal (e.g. principal sells %9 to another party even if
an agent has been constituted in reference to it), principal liable for damages for his wrongful
terminating act# if %9 is lost without principal3s fault, no liability assumed by him
Chan!e of Circumstance:
GR 4 when there is a basic change in the circumstances surrounding the transaction, which was
not contemplated by the parties and which would reasonably lead the agent to believe that the
principal would not desire him to act, the authority of the agent is terminated
%#ceptions:
1. -f the original circumstances are restored within a reasonable period of time, the agentDs
authority may be revived
!. 8here the agent has reasonable doubts as to whether the principal would desire him to
act, his authority will not be terminated if he acts reasonably
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$. 8here the principal and agent are in close daily contact, the agentDs authority to act will
not terminate upon a change of circumstances if the agent 1nows the principal is aware of
the change and does not give him new instructions
1e$ocation 5 termination of the agency by the subse6uent act of the principal
1enunciation0)ith%ra+al 7 termination of the agency by the subse6uent act of the agent
Principal6s "ia(ility for Dama!es Despite 1e$ocation
1. if the agency was constituted for a fi*ed period, the principal shall be liable for damages
occasioned by the wrongful discharge of the agent before the e*piration of the period fi*ed
!. even if there was no time fi*ed for the continuance of the agency, but the agent can prove that
the principal acted in bad faith by revo1ing the agency in order to avoid the payment of
commission about to be earned, the principal can be held liable for damages
Necessity of Notice of 1e$ocation
1. as to the agent 4 e*press notice always necessary# sufficient notice if the party to be
notified actually 1nows, or has reason to 1now, a fact indicating that his authority has been
terminatedCsuspended# revocation without notice to the agent will not render invalid an act
done in pursuance of the authority
!. as to 0
rd
persons 5 e*press notice necessary
a. as to $ormer customers 7 actual notice must be given to them because they always
assume the continuance of the agency relationship
b. as to other persons 7 notice by publication is enough
3ay the a!ency (e e7tin!uishe% at +ill8
A.A0:>' may do so but sub&ect to the contractual obligations owing the principal (i.e. fi*ed
period of time for the agency or purpose not yet accomplished)#
expressl# or impliedl#
(a) conducted himself in a manner incompatible with his duties#
(b)abandons the ob&ect of agency and acts for himself in committing a fraud upon his principal#
(c)he files a complaint against the principal and adopts an antagonistic attitude towards him
1. with &ust cause 7 give due notice
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!. without &ust cause 7 liable for damages if agent suffers damages thereby B>2:%% the
agent should base his withdrawal upon the impossibility of
continuing the performance of the agency without grave detriment
to himself
N.(%: 'he mere fact that the agent violates his instructions does not amount to renunciation,
and although he may thus render himself liable to the principal, he does not cease to become an
agent.
B. +;->,-+A2 may also revo1e the agency at will
%#ception: agency coupled with interest
a. 8hen a bilateral contract depends upon the agency
b. 8hen the agency is the means of fulfilling an obligation already contracted
c. 8hen a partner is appointed as manager of a partnership in the contract of
partnership and his removal from the management is un&ustifiable.
%#ception to the e#ception: when the agent acts to defraud the principal

&mplie% 1e$ocation of A!ency
1. principal appoints a new agent for the same business or transaction, only if there is
incompatibility)# effective as between the principal and the agent only if communicated
to the agent# does not pre&udice rights of third persons acting in 0. without 1nowledge of
the revocation
!. principal directly manages the business entrusted to the agent, dealing directly with $
rd
persons
Effect of E7tin!uishment )ithout Notice:
act of agent deemed valid insofar as $
rd
parties acting in good faith and without 1nowledge of
revocation
Effect of &ssuance of a #PA:
'he general power is impliedly revo1ed as to matters covered by the special power because a
special power naturally prevails over a general power.
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