Académique Documents
Professionnel Documents
Culture Documents
Purpose:
I.
Agency as a Concept
A. Definition
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.
Art. 1869 Agency may be express, or
implied from the acts of the principal, from
his silence or lack of action, or his failure to
repudiate the agency, knowing that another
person is acting on his behalf without
authority. Agency may be oral, unless the
law requires a specific form.
Art. 1870 Acceptance by the agent may
also be expressed, or implied from his acts
which carry out the agency, or from his
silence or inaction according to the
circumstances.
--Characteristics:
a. Consensual
b. Principal
c. Nominate
d. Unilateral/Bilateral
e. Preparatory
Nature:
>manifest consent
>agent becomes principal
>presence/absence of
contract/consideration
Basis:
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LOAN
Money advanced to
another is expressly
regarded as loan
Financing of
operations to be
carried by another
for the mutual
advantage of both,
without any
obligation of such
other to return
money advanced
Borrower is given
money for purposes
of his own and must
return it
Checks deposited
with a collecting
bank, agency
Agency between
bank and creditor
AGENCY
AGENCY
Basis is
representation
Employment
Agent exercises
discretionary powers
Performs
ministerial
functions
3 persons involved
2 persons (lessor,
lessee)
Relates to
commercial or
Mere manual or
mechanical
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business transactions
execution
AGENCY
Agent is subject to
control and
direction of
principal
INDEPENDENT
CONTRACT
Not subject to control
of employer except as
to result of work
AGENCY
PARTNERSHIP
AGENCY
BROKERAGE
Engaged for
purchase or sale of
properties and
maintains
relationship with
principal, purchaser,
and property
No relation with
thing he buys/sells
Receives
commission upon
successful
conclusion of
transaction
Not applicable
Re: Liability of agent
Liable
AGENCY
NEGOTIORUM
GESTIO
Representation is
expressly conferred
Without authority
and knowledge of
owner
Contract
Quasi-contract
AGENCY
SALE
Buyer receives
goods as owner
Agent delivers
proceeds of sale
Buyer as a general
rule cannot return
object sold
AGENCY
BAILMENT
Bailee has no power
to bind bailor in
personal liability
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AGENCY
GUARDIANSHIP
Derives authority
from principal
Relationship is
founded upon
consent
Subject to control
of principal
Agent is appointee
of the principal, at
any time can
abrogate agent
Legal guardian is
substituted by law
AGENCY
Represents and
acts for principal
TRUST
Title and control of
property passes to
the trustee who acts
on his own name
Agency may be
revoked at any
time
Trust may be
terminated only by
the fulfillment of its
purpose
Constant
supervision and
control of principal
Discretion of the
trustee and guidance
by the settler
JUDICIAL
ADMINISTRATION
AGENCY
Appointed by court
Representative of court,
heirs, and creditors of
the estate
B. Elements
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Special Agent
Scope of authority
All acts connected
with the business or
employment in which
a principal is engaged
Conduct a single
transaction or
series of
transactions not
involving continuity
of service and
covering a
relatively limited
period of time
Cannot bind a
principal in a
manner beyond or
outside the specific
acts which he is
authorized to
perform on behalf
of the principal
Knowledge/disclosure of limitations of
power
Continuing and
unrestricted by
limitations other than
those which confine
the authority within
the bounds of what is
usual, proper, and
necessary under like
circumstances. If
there are limitations,
principal must
disclose them.
Temporary and
naturally suggests
limitations of
power of which
third persons must
inform themselves
Statement by
principal with
respect to agents
authority would be
regarded as words
limiting the
authority of the
agent
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authority.
2. Authority
Art. 1877 An agency couched in
general terms comprises only acts of
administration, even if the principal
should state that he withholds no
power or that the agent may execute
such acts as he may consider
appropriate, or even though the agency
should authorize a general and
unlimited management.
Art. 1878 Special powers of attorney
are necessary in the following cases:
1. To make such payments
as are not usually
considered as acts of
administration
2. To effect novations
which put an end to
obligations already in
existence at the time
the agency was
constituted
3. To compromise, to
submit questions to
arbitration, to renounce
the right to appeal from
a judgment, to waive
objections to the venue
of an action or to
abandon a prescription
already acquired
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To effect novation:
*Novation is the extinction of an
obligation through the creation of a
new one which substitutes the old one.
*Obligations must already be in
existence at the time the agency was
constituted.
To compromise etc.:
*A compromise must be strictly
construed.
*These are acts of ownership since they
involve the possibility of disposing of
the thing or right subject to
compromise or arbitration.
*Compromise is merely unenforceable
if without a special power of attorney.
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ve
on
Form of agency:
Kinds of Agency
As to manner of creation
Express
Implied
As to character
Gratuitous
Onerous
Special
As to authority conferred
General terms
Specific terms
Simple/commissi
Art. 1872
Principal transmits
the power of
attorney to the
agent
Art. 1871
Principal personally
delivers the power of
attorney to the
agent
e. Estoppel
Art. 1873 If a person specially informs
another or states by public
advertisement that he has given a
power of attorney to a third person, the
latter thereby becomes a duly
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If he
knows that
an agent is
acting on
behalf of
principal
and fails to
repudiate
his acts or
accepts
benefits
from it, he
is
estopped
to deny
agency
He will be
estopped to
deny agency
if he has
knowledge
of the fact
of the
transaction
and the
terms of
agreement
between
the agent
and subagent
If principal
knows that
the other is
acting as
his agent
or
permitted
him to act
as his
agent,
injury to
third
persons is
imputed to
principal
and
principal
cannot
deny
agency
As to SUBAGENT:
As to
THIRD
PERSONS:
AGENCY BY
ESTOPPEL
IMPLIED
AGENCY
There is an
actual agency,
as much as if it
were created by
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express words.
-Principal alone
is liable.
A. Right to Compensation
Reliance is not
necessary since
the agent is a
real agent.
-Principal is
liable
-Principal is liable
Nature of authority
An apparent agent is
no agent at all, and
as against the
principal, has none of
the rights of an agent
except where the
principals conduct or
representations are
such that the agent
believed that the
principal intended
him to act as agent in
the matter
An agent by
implied
appointment is
a real agent
with all the
rights and
liabilities; he
has actual
authority to act
on behalf of the
principal
Should be restricted
to cases in which
authority is not real
but apparent
An actual
agency in which
it is a fact to be
proved by
deductions or
inferences from
other facts
Necessity of compensation:
>There can be agency even without
compensation.
>Even though it is gratuitous, agent is still
bound to act like how an agent with
compensation is to act.
Liability of principal to pay compensation:
>Amount must be paid based on whatever
compensation is agreed upon or if theres
nothing agreed upon, a reasonable value
for the services.
>Liability of the principal to pay commission
presupposes that the agent has complied
with his obligation as such to the principal.
>The agent must prove that he was the
guiding cause for the transaction or the
procuring cause thereof, depending upon
the facts of the particular case.
>>Procuring cause refers to a cause
originating a series of events which, without
break in their continuity, result in the
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Exception:
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AUTHORITY
Source/cause
Effect
Law
Requisites:
a. Agent must have possession first.
b. If principal fails to reimburse or
indemnify agent.
Nature of agents right of lien:
>Right is limited to subject matter of agency
only. No right to retain the principals goods
for claims not related to the agency.
>Agent must have possession over the
subject matter in which the lien is claimed.
>If no ratification of the sub-agents acts by
principal, this right is only available to
agent.
IV. Agents Obligations
A. Obligation to act within the scope of his
authority
Art. 1881 The agent must act within the
scope of his authority. He may do such acts
as may be conducive to the
accomplishment of the purpose of the
agency.
Art. 1882 The limits of the agents
authority shall not be considered exceeded
should it have been performed in a manner
more advantageous to the principal than
that specified by him.
POWER
Kinds of authority:
a. Actual
b. Express
c. Implied
d. Apparent or ostensible
e. General
f.
Special
APPARENT
No express
authority
No agency; no
authority at all
-principal is liable
as if in a regular
agency
relationship
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reliance by third
party in good faith
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If authority is in writing:
1. By implication
2. By usage or custom
3. By necessity
4. By doctrines of:
a. Apparent authority
b. Liability of estoppel
c. Ratification
5. By the rule of ejusdem generis
Responsibility of principal where agent
acted with improper motives:
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AUTHORITY
INSTRUCTIONS
Sum total of
powers permitted
to agent; may be
limited in scope
and such
limitations are part
of the authority
Relates to the
subject with which
the agent is
empowered to act
Manner or mode of
his action with
respect to matters
which in their
substance are within
the scope of
permitted action
Limitations of
authority are
operative as
against those who
have or are
charged with
knowledge of them
Instructions limiting
the agents authority
are without
significance as against
those dealing with
the agent with
neither knowledge
nor notice of them
To be made known
to the third person
dealing with the
agent
Not expected to be
made known to those
with whom the
person deals
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i.
Double sale
Art. 1916 When two persons contract
with regard to the same thing, one of
them with the agent and the other with
the principal, and the two contracts are
incompatible with each other, that of
prior date shall be preferred, without
prejudice to the provisions of Article
1544.
Art. 1917 In the case referred to in
the preceding article, if the agent has
acted in good faith, the principal shall
be liable in damages to the third person
whose contract must be rejected. If the
agent acted in bad faith, he alone shall
be responsible.
Art. 1544 If the same thing should
have been sold to different vendees,
the ownership shall be transferred to
the person who may have first taken
possession thereof in good faith, if it
should be movable property. Should it
be immovable property, the ownership
shall belong to the person acquiring it
who in good faith first recorded it in the
Registry of Property. Should there be no
inscription, the ownership shall pertain
to the person who in good faith was
first in the possession; and, in the
absence thereof, to the person who
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2 cases contemplated:
I.
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