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AGENCY MID TERM PROVISIONS a) Sale of land or any interest (1874)

b) Statute of Frauds
I. NATURE, FORM AND KINDS OF AGENCY

1868- With consent or authority of the Principal, An agent 1870- Applicability of 1869 to Agents
binds himself to:
a) Render some service 1872- When ABSENT, agency CANNOT be implied from the
b) Represent the principal silence of the agent EXCEPT:
i. When the power of attorney was submitted, but
1869- Express/Implied (Principal) agent had no objections
a) Agency may be constituted EXPRESSLY or IMPLIEDLY, ii. When principal sent through letter or telegram a
i. Even if a person is acting on behalf of another power of attorney and the agent is habitually engaged in that
WITHOUT the consent or authority, agency is still valid if the business and did not reply
PRINCIPAL is SILENT or DOES NOT DO ANYTHING to repudiate
the agency. 1875- Agency is PRESUMED to be for compensation UNLESS
ii. When the Principal sends his power of attorney, and proven otherwise
through silence of the agent and with no objections, it is
implied he accepted it. (When present) (1871) 1876- Agency is either GENERAL or SPECIAL
iii.
-When principal tells a SPECIFIC person that he GENERAL
sent a PA to the agent, it only affects the SPECIFIC -Comprises all the business of the Principal
person (1873) -ONLY ACTS OF ADMINISTRATION even if Principal gives Agent
- When advertised, affects EVRYONE (1873) unlimited powers
-UNLESS: Rescinded
SPECIAL
-Only for specific transactions or acts of administration
ORALLY: -SPA: Special power to sell does not include special power to
mortgage and vice-versa (1879)
It may be done orally EXCEPT:
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-Special power to compromise does not authorize submission to him by the P until the latter appoints a new A ; P can either
to arbitration (1880) appoint a new A or take charge of the goods (1885)
-A would be bound to advance the necessary funds if theres a
1878- When SPA is necessary (memorize) stipulation EXCEPT when P is INSOLVENT (1886)
1881- The agent must act within the scope of his authority, -A shall act in accordance with the instructions of the P (1887)
EXCEPT: - In default, A should do all that a good family of a family
a) Conducive to the accomplishment of the purpose of the would do, as required by the nature of the business (1887)
agency -A should not carry out the agency if it would result loss or
b) More advantageous to the principal (1882) damage to the P (1888)
c) In case of loan (SPA needed), except when such is urgent -A may be the lender if he was authorized to borrow money
and indispensable for the preservation of the principals (condition: current rate of interest) (1890)
property (administration) (1878(7)) -If authorized to lend money at interest, P can borrow money
w/ Ps consent (1890)
1883- Agent is solely bound against third persons if he acts on -Render an account of his transactions and deliver to the P
his own name. what ever he might have received by virtue of the agency
- Principal no right of action against third persons and even though it may not be owing to the P (1891) (note:
vice-versa. stipulation to waive such is VOID)
-Except: if it involves the property of the principal -Shall be responsible for the acts of the substitute when:
-Either way, Principal can go against the agent (a) he was not authorized to appoint a sub
(b) if he was authorized, but without designating the
person, the sub was notoriously incompetent or insolvent
II. OBLIGATIONS OF THE AGENT
Note: All the acts of the sub are void when the P prohibited
-When ACCEPTED, A is bound to carry out the agency (1884) the appointment (1892) and may file an action against the sub
-Continue the business already started notwithstanding the with respect to the obligations the sub entered into (1893)
DEATH of the P, should DELAY entail any danger (1884)
- If A DECLINES, still bound to observe the DILIGENCE OF A -Solidary liable w/ other As for the non-fulfillment of the
GOOD FATHER OF A FAMILY to preserve the goods forwarded agency, fault and negligence of his fellow As, EXCEPT:
a) Solidarity not expressly stipulated (1894)
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b) For fault and negligence, when the fellow agents acted -Responsible for the goods received by him unless he makes a
beyond the scope of their authority (1895) written statement of the damage and deterioration suffered
(1903)
- Owes interest on the sums he has applied to his own from -Should distinguish the goods of the same kind and mark
the day he did until the extinguishment of the agency (even belonging to different persons by counter-marks (1904)
after if he has not paid it in full) (1896) -Cannot sell on credit WITHOUT the EXPRESS OR IMPLIED
-Liable to the party whom A contracts with when he: consent of the P, however entitled to any interest or benefit
(a) expressly binds himself which may result from the sale (1905)
(b) exceeds the limits of his authority without giving -When authorized to sell on credit, A should inform P with a
rd
the 3 party a notice of his powers (1897) statement of the names of the buyers; if not complied with, it
-A is liable if: shall be deemed to be made for cash (1906)
(a) he contracted in the name of the P -If the CA should receive a guarantee commission, he shall
(b) he exceeded his authority bear the risk of collection AND pay the P the proceeds of the
(c) P does not ratify the contract sale (1907)
(d) 3rd persons knowledgeable of the As limits
(e) A promised to secure Ps ratification, but failed to Principal
do so (1898) -Cannot set up As ignorance if A acted in accordance to Ps
NOTE: Contract is void if a-d are present orders (1899)
-Responsible not only for fraud but also for negligence (1909) -May demand from the Commission Agent payment in cash if
the latter sold on credit WITHOUT Ps consent (1905)

A liable for damages: Third Persons
-If P might suffer due to As non-performance (1884) -It is understood that the A did not exceed his authority when
-If A chooses his own interest over Ps (1889) it was written in the power of attorney EVEN IF the A did
-CA is liable for damages if he does not collect the credits of exceed his authority (1900)
the P UNLESS he proves that he exercised DUE DILIGENCE -Cannot contest that the A exceeded his powers when P has
(1908) ratified the act or about to do so (1901)

Commission Agent
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-Can require the power of attorney from the agent AND secret (c) A was knew that an unfavorable result would ensure and P
orders and instructions of the P cannot prejudice the 3rd was NOT AWARE
persons (1902) (d) Stipulation or that A would only be allowed a certain sum

III. OBLIGATIONS OF THE PRINCIPAL Agent
-Retain in pledge the objects of the Agency until P reimburses
-Comply w/ every obligation the A entered into within the him (1914)
scope of his authority (1910) -If in bad faith pursuant to 1916, solely liable (1917)
-P is liable even if A exceeded his authority when:
(a) P expressly or tacitly ratifies it (1910) IV. MODES OF EXTINGUISMENT OF AGENCY
(b) P allowed A to act as though he has full powers (solidary
liable) (1911) -ART. 1919 (memorize)
-Advance the sums necessary for the execution of the Agency -The appointment of a new agent for the same business or
to A if the latter requests (1912) transaction, revokes the former agency, but former agent
-Reimburse A if A advanced the sums EVEN IF the business or should be given notice (1923)
undertaking was not successful PROVIDED that A is not at -Agency is revoked when the P DIRECTLY MANAGES the
fault; includes interest (1912) business entrusted to the A (1924)
-Indemnify the A for damages, which might have caused him -A GPA is revoked by the SPA with regard to the specific
in the execution of the agency (ONLY WHEN A IS NOT AT matters (1926)
FAULT OR NEGLIGENT) (1913) - An agency CANNOT BE REVOKED if a bilateral contract and it
-If there are 2 or more Ps, they are solidarily liable to the is coupled with interest AND when the removal of a managing
agent (1915) partner is unjustifiable (1927)
-liable to 3rd persons he contracted with and had to be -Even after the death of the P, agency is still in full effect if
rejected (pursuant to 1916) when A was in good faith (1917) Agency is coupled with interest (1930)
-NOT liable for the expenses incurred by the agent when: -Contracts entered into by the A with 3rd persons, with both
(a) A acted in contravention of the P EXCEPT when P availed not having knowledge of the death of the P, will continue to
the benefits of the contract be effective (1931)
(b) Expenses were due to the fault of the A
Principal
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-May revoke the agency at will and compel A to return

documents evidencing the agency (1920)
-When 2 or more Ps granted a PA for a COMMON
TRANSACTION, ANY OF THEM may revoke the agency
WITHOUT consent of the others

Agent
-May withdraw from the agency after giving notice to the P
(1928)
-Should indemnify the P if withdrawal will incur damages to
the P UNLESS the reason for withdrawal is the impossibility of
continuing the agency without grave detriment to the A
(1928)
-Even if A has already withdrawn for a valid reason, he must
still continue to act until the P had opportunity to take
necessary steps to meet the situation (i.e. replace A) (1929)
-When A dies, his heirs should notify the P and adopt
measures as the circumstances may demand in the interest of
the P (i.e. continue agency, etc)

3rd persons
-Shall not prejudice SPECIFIED PERSONS if they were not given
notice of the extinguishment (1921)
-Shall not be prejudiced of the extinguishment when they
acted in good faith and without knowledge of revocation
(when A has general powers); however, notice via newspaper
of general circulation is sufficient (1922)