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Respondent MASADA Security Agency, Inc., entered into a contract[3]to provide security services to the various offices,
warehouses and installations of NFA within the scope of the NFA Region I
The Regional Tripartite Wages and Productivity Board issued several wage orders mandating increases in the daily wage rate.
Respondent requested NFA for a corresponding upward adjustment in the monthly contract rate consisting of the increases in the
daily minimum wage of the security guards as well as the corresponding raise in their overtime pay, holiday pay, 13th month pay,
holiday and rest day pay. It also claimed increases in Social Security System (SSS) and Pag-ibig premiums as well as in the
administrative costs and margin. NFA, however, granted the request only with respect to the increase in the daily wage by multiplying
the amount of the mandated increase by 30 days and denied the same with respect to the adjustments in the other benefits and
remunerations computed on the basis of the daily wage.
The trial court rendered a decision[13] in favor of respondent holding that NFA is liable to pay the security guardsƞ wage related
benefits pursuant to RA 6727, because the basis of the computation of said benefits, like overtime pay, holiday pay, SSS and Pag-ibig
premium, is the increased minimum wage. It also found NFA liable for the consequential adjustments in administrative costs and
margin.
NFA claims that its additional liability under the aforecited provision is limited only to the payment of the increment in the
statutory minimum wage rate, i.e., the rate for a regular eight (8) hour work day.


 WON the satisfaction of NFAƞs Obligation is limited to the payment of the increased statutory minimum wage rates. 




Based on the foregoing interpretation of Section 6 of RA 6727, the parties may enter into stipulations increasing the liability of the
principal. So long as the minimum obligation of the principal, i.e., payment of the increased statutory minimum wage is complied with,
the Wage Rationalization Act is not violated.
In the instant case, Article IV.4 of the service contract provides:
IV.4. In the event of a legislated increase in the minimum wage of security guards and/or in the PADPAO rate, the AGENCY may
negotiate for an adjustment in the contract price. Any adjustment shall be applicable only to the increment, based on published and
circulated rates and not on mere certification.
Par 3 of NFA Memorandum AO-98-03- states:
3. For purposes of wage adjustments, consider only the rate based on the wage Order issued by the Regional Tripartite
Wage Productivity Board (RTWPB). Unless otherwise provided in the Wage Order issued by the RTWPB, the wage
adjustment shall be limited to the increment in the legislated minimum wage;[32]
The parties therefore acknowledged the application to their contract of the wage orders issued by the RTWPB pursuant to RA
6727. There being no assumption by NFA of a greater liability than that mandated by Section 6 of the Act, its obligation is limited to
the payment of the increased statutory minimum wage rates which, as admitted by respondent, had already been satisfied by NFA.


 
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SMC sold beer products on credit to the Culaba spouses in the amount of P28,650.00, as evidenced by Temporary Credit Invoice
No. 42943.
Thereafter, the Culaba spouses made a partial payment of P3,740.00, leaving an unpaid balance of P24,910.00. As they failed to
pay despite repeated demands, SMC filed an action for collection of a sum of money against them before the RTC
The defendant-spouses denied any liability, claiming that they had already paid the plaintiff in full on four separate occasions. To
substantiate this claim, the defendants presented four (4) Temporary Charge Sales (TCS) Liquidation Receipts
Defendant Francisco Culaba testified that he made the foregoing payments to an SMC supervisor who came in an SMC van. He was
then showed a list of customersƞ accountabilities which included his account. The defendant, in good faith, then paid to the said
supervisor, and he was, in turn, issued genuine SMC liquidation receipts.
SMC submitted a publisherƞs affidavit9 to prove that the entire booklet of TCSL Receipts bearing Nos. 27301-27350 were reported
lost by it, and that it caused the publication of the notice of loss in the July 9, 1983 issue of the Daily Express




WON the payment of the petitionersƞ obligation to the private respondent was properly made, thus, extinguishing the
same. 





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In this case, the payments were purportedly made to a "supervisor" of the private respondent, who was
clad in an SMC uniform and drove an SMC van. He appeared to be authorized to accept payments as he showed a list of customersƞ
accountabilities and even issued SMC liquidation receipts which looked genuine.
The basis of agency is representation. A person dealing with an agent is put upon inquiry and must discover upon his peril the
authority of the agent. 
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The petitioners in this case failed to discharge this burden, considering that the private respondent vehemently denied that the
payments were accepted by it and were made to its authorized representative.
In the case at bar, the most prudent thing the petitioners should have done was to ascertain the identity and authority of the
person who collected their payments. Failing this, the petitioners cannot claim that they acted in good faith when they made such
payments. Their claim therefor is negated by their negligence, and they are bound by its consequences. Being negligent in this regard,
the petitioners cannot seek relief on the basis of a supposed agency.