RALLOS VS. FELIX GO CHAN & REALTY CORP.

FACTS
Concepcion and Gerundia Rallos were sisters and co-owner of a registered parcel of land.
They executed an SPA in favor of their brother, Simeon Rallos authorizing him to sell the said land
in their behalf. Concepcion died, Simeon sold the undivided shares of his sisters to Felix Go Chan
new TCT issued. However Ramon Rallos the administrator of the Intestate Estate of Concepcion
claim: a) The sale of property share of the deceased be unenforceable and to reconveyed to her
estate; b) The TCT of title issued to in the name of Felix Go Chan be cancelled. c) Attorney’s fees.

CFI declare the sale null and void. Petitioner appealed to the IAC and latter upheld the sale
and denied the MR.
ISSUE
WON the sale fell within the exception to the GR that death extinguishes the authority of the
agent?
HELD
No. Art. 1919 p (3) Agency is extinguished by the death, civil interdiction, insanity or
insolvency of the principal agent unless the power is coupled with interest. (Art 1930 interest: a)
common interest between the agent and principal; b) Interest of a third person who has accepted the
stipulation with him in good faith. Art 1931, act done by the of the agent after the death of the
principal is valid only a) that the agent acted without knowledge of the death of the principal and b)
third person who contracted with the agent himself acted in good faith.
In this case the sale did not fall under the exceptions to the general rule because the SPA in
favor of agent Simeon Rallos was not coupled with interest and article 1931 is inapplicable because
the latter knew of his principal’s death.

BORDADOR VS LUZ
FACTS
Petitioner Bordador, who were running a jewelry business, entrusted pieces of jewelry to
Deganos, who was obligated to sell them. Deganos failed to account for them. A civil case filed
against him, which prayed that Brigida Luz, who was purported to be his principal, be held
solidarily liable. RTC ruled that there was no contract of agency between the Luz and Deganos. It
was the petitioner Bordador who indicated that the items were received on behalf of Luz. Even there
was a contract of agency, there was no memorandum to this effect and was therefore unenforceable.
The CA affirmed the judgment.
ISSUE
Whether or not there was a contract of agency between Luz and Deganos?
HELD

NO. Art. 1868 of NCC provides, By the contract of agency one person bind himself to render
service or do to something in representation on or behalf of another with the consent or authority of
the latter. The basis of agency is representation.
In the instant case there was no showing that Brigida Luz authorized Deganos to act in their
behalf. It is inexcusable negligent on the part of the Petitioner Bordador to entrust Deganos with
jewelries without written authorization from the suppose principal. A person dealing with the agent
is put upon inquiry and must discover upon his peril the authority of the agent. Also assuming that
there is agency between LUZ and Deganos the same is unenforceable for failure to comply with
Statutes of frauds. Hence the petitioner cannot seek relief for the effects of their negligence.

ORIENT AIR SERVICES VS CA

FACTS
By virtue of an agreement, American Airlines authorized Orient Air to be its exclusive general
sales agent within the Philippines for the sale of air passage transportation. Later on, American Air
terminated the relationship and filed a suit against Orient Air, claiming that Orient Air remiss in its
obligation to remit the collected money from the sales. Orient Air contends that that withheld
amount is considered the overriding commission owed to them by American Airlines. Also the
actions made by the AA terminating the agreement were untenable, prejudicial to its business
interest. Trial Court ruled that AA still owed Orient Air overriding commission, thus the non-
remittance was justified and ordered the AA to reinstate the OA as general sales agent. IAC affirmed
that decisions of the court a quo.
ISSUE
Whether or not the CFI and IAC was correct in reinstating OA as AA sales agent?
HELD
NO. As agency defined as contract whereby a person binds himself to render service or to do
something in representation or on behalf of another, with the consent or authority of the latter.

In the instant case the fact that the CFI and IAC compelled the AA to extend its personality to
OA is violative to the principle and essence of agency.

EUROTECH INDUSTRIAL TECHNOLOGIES,INC. VS. CUIZON

FACTS
Eurotech is engaged in the business of importation and distribution of various European
industrial equipment. Later Eurotech sold to Impact System various products and a Sludge pump,
Erwin Cuizon making a down payment. However Eurotech refused to to deliver the same to Cuizon
without having fully settled their obligation, thus, Cuizon and Alabert de Jesus, general manager of
Eurotech executed a Deed of assignment of receivables in favor of Eurotech. Despite the existence of
deed of assignment, Cuizon proceed to collect from Toledo Power Company. Eurotech made several
demands to Cuizon but the later alleged that he not real party in interest he is only acting as an
agent of his principal the Impact System and it was ratified by the latter. Trial Court granted the
petitioner’s prayer issuance of preliminary attachment and drop Erwin Cuizon as a party defendant.
CA affirmed the decisions of the trial court.
ISSUE
Whether or not Edwin Cuizon exceeds his authority when he signed a Deed of Assignment
binding himself personally to pay the obligation to eurotech?
HELD
No. Article 1897 a person who acts as such is not personally liable to the party with whom he
contract,unless he expressly bind himself or exceed the limit of his authority without giving such
party sufficient notice of his powers.
 In the case at bar, Eurotech known that Edwin acted merely as an agent of the Impact
System. It shown on its complaint alleging that Edwin is being sued in his capacity as a manager of
the said business venture. Moreover Impact System desperately needed the slug pump for its
business despite the refusal of the Eurotech to deliver the same due to its default on its obligation it
still persisted to negotiate by executing a Deed of Assignment of its receivable from Toledo Power
Company in Eurotech favor. Hence it is undoubtedly the participation of Edwin in the Deed of
Assignment is reasonably necessary or was required in order for him to protect the business of his
principal.
Qui facit per alium facit perse.- By this legal fiction the actual or real absence of the
principal is converted into his legal or juridical presence.

DOMINGO VS DOMINGO
FACTS

The petitioner granted the respondent the exclusive agency to sell his lot at the rate of P2.00
per sqm. With 5% commission, Subsequently respondent authorized Teofilo Purisima to look of a
buyer with promising him ½ of 5% commission which the latter introduce Oscar de leon Oscar de
leon raised his offer to P 109,000,00 issued 1,000 and promise to deliver another to petitioner as
an earnest money and give advanced to the defendant. Oscar confirmed his offer to P1.20 per sqm.
Oscar give the defendant P1, 000 as a gift for persuading the petitioner to sell to him the property.
This gift was not disclosed to respondent to the petition

When Oscar did not see him, respondent went to the petitioner and insist that the latter still
committed to pay him commission if the property was sold within 3months after the expiration of
the agency. The respondent demanded the payment of his commission from petitioner upon
learning that the latter sold the property to same buyer. However Oscar Deleon told to him that the
petitioner asked him( de leon) to eliminate him ( respondent) in the transaction because he sold the
property to another buyer as such he will sold the property on him in to lower price.

CA-decided the case in favor of the respondent. That the respondent and Purisima were the
efficient cause of the sale to the spouse Deleon. Since Amparo the vendee, being wife of De leon the
sale is practically to Oscar de leon since husband and wife have common or identical interest;.
ISSUE
Whether or not the respondent committed fraud against the petitioner his principal when he
did not disclosed to the latter that he receive 1K as a gift for persuading the petitioner to reduce the
purchase price of the said property?
HELD
Yes! Pursuant to art.1891 Every agent is bound to render an account of his transactions and to
deliver to the principal whatever he may have received by virtue of the agency, even though it may
be owing to the principal. Every stipulation exempting the agent from the obligation to render an
account shall be void. Art. 1909 the agent is responsible not only for fraud but also for negligence,
which shall be judged with more less rigor by the courts, according to whether the agency was not
for a compensation.
Hence, an agent who take a secret profit in the nature of a bonus, gratuity or personal from the
vendee, without revealing the same to his principal, the vendor is guilty of a breach of his loyalty to
the principal and forfeit his rights to collect the commission form his principal.
 In this case respondent as broker, receive a gift from the buyer de leon and did not disclose the
same to his principal the petitioner. The said acceptance corrupted his duty to serve the interests
only of his and undermined his loyalty to his principal, who gave him partial advance 300 of his
commission. As a result he did not persuade the buyer to purchase the property on more
advantageous terms by his principal but instead he succeeded on persuading the principal the
petitioner to sell the property in lower price on which he desire.

MANOTOK BROS. VS CA
FACTS
Petitioner authorized the private respondent to negotiate with the city of manila the sale of
property not less than P425k in writing with 5% commission when finally consummated and paid.
Petitioner extend the authority of private respondent for total of 240 days. Later Manotok, its
president, authorized respondent the sale of property to the city of manila for not less than P410k.
Subsequently the Board of Manila passed an ordinance appropriating the sum of P410k for the
purchase of the property.
After the parties sign the deed of sale, the petitioner denied the claim of the respondent’s
commission on the ff. grounds: a) Private respondent would be entitled to a commission only if the
sale was consummated and the price within the period given in the respective letters of authority; b)
respondent was not the person responsible for the negotiation and consummation of the sale,
instead it was filomeno Huelgas. CFI ordered petitioner or Rufino Manotok to pay respondent the
commission. CA affirmed the decisions of the trial court.
ISSUE
Whether or not Salvador Salumbiga was entitled for the commission?
HELD

Yes. Jurisprudence dictates that when there is a close, proximate and causal connection
between the agent’s efforts and labor and the principal’s sale of his property, the agent is entitled to
a commission.
In the instant case, the sale was materialized through the efforts of the private respondent.
The Municipal ordinance was approved when the private respondent’s authorization was still in
force. The intervention of Huelgas regarding the purchase came only after the ordinance had already
been passed, and when the buyer has already agreed to the purchase and to the price for which said
property is to be paid. Without the respondent’s efforts Mayor Villegas would have nothing to
approve in the first place.
INLAND REALITY VS CA
FACTS
The petitioner and Gregorio Araneta Inc. granted the former the authority to sell on the first
come first served basis the holdings of the latter. The authority given to the petitioner was extended
for 3 times. Later the petitioner finally sold the shares of stocks for P13.5M and afterwards the
petitioner demand commission which was declined by the Araneta Inc, claiming that the petitioner
was no longer privy to the transaction of sale because their authority to sell had already expired.
RTC dismissed the case CA affirmed the dismissal stated that petitioner’s contract of agency and
authority to sell already expired.
ISSUE

Whether or not the petitioner was entitled to the broker’s commission upon the expiration of
the contract of agency?
 HELD
No. The Inland realty was not entitled to Broker’s commission since they had nothing to show
that they performed substantial acts that led to the consummations of the sale to standford of
Araneta Inc. shares. Inland failed to in selling said shared under the terms and agreements set out
by Araneta Inc. The CA was correct for emphasizing the lapse of more than 1yr and 5mos. Between
expiration of petitioners' authority to sell.

TAN VS GULLAS
FACTS

The respondents, were registered owners of a parcel of land, they executed a special power of
attorney authorizing petitioners Tan, a license broker together with his associates to negotiate the
sale of land with commission. Petitioner contracted the Sister of Mary who later acquired the
property. Subsequently the petitioner see the respondents who refused to pay the broker’s fee and
claimed that another group of agents was responsible for the sale of the land. The petitioner filed a
complaint before the RTC. Trial court decided the case ordered the defendants to pay the petitioner
and his associates. CA reverse and set aside the decisions of lower court.
ISSUE
Whether or not the petitioners were entitled to the broker’s commission?
HELD

Yes. Jurisprudence dictates that a broker earns his pay merely by bringing the buyer and the
seller together even if no sale is eventually made.

In this case the SC reinstated the findings of the trial court that alleged broker of the private
respondent Pacana was the one entitled to the commission was untenable considering that it was
the petitioner were responsible for the introduction of the representatives of the sister of Mary to the
private respondent Gullas. Moreover there was nothing on record which established that existence of
a previous negotiation among the alleged broker Pacana, Mrs.Gullas and the Sister of Mary. Lastly
the petitioner were given the written authority to sell by the private respondents.

MEDRANO VS CA
FACTS

The petitioner Medrano asked Mrs. Estrela Flor, a cousin in law to look for a buyer of mango
plantation amounting to P2.2M. Pacita Borbon a licensed real estate br0oker informed her business
associates and her friends that she had a ready buyer for mango orchard. Flor advised her that her
cousin in law owned a mango plantation which was up for sale and Borbon told to her that Petitioner
Medrano should give them a written authority to negotiate the sale of the property.

Later Dominador Lee the client of Borbon told to respondent Josefina Antonio that he already
purchase the property and had made a downpayment of P1M and subsequently the deed of sale was
eventually executed between the bank represented by Guanzon and KBG farm by Lee. When the
respondents asked for their commission the petitioner refused. Hence, the respondent was
constrained to file an action against herein petitioners. Trial Court rendered judgment in favor of the
respondents. Ordered the petitioner to pay solidary the brokers commission.CA affirmed the decisions
of the Trial Court. Applying the principle of agency held that Medrano constituted the respondents
as his agents granting the authority to represent and act on behalf of the former on the sale of the
mango plantation.
ISSUE
Whether or not the broker are entitled to commission for the sale of the subject property?
HELD

Yes. The brokers were entitled to the commission. A broker is one whose occupation is to
bring parties together, in matters of trade, commerce or navigation.

In the instant case the respondents were the procuring causes in the transactions although
they did not participated in the negotiation of the sale. Armed with authority to procure a purchaser
and with a license to act as a broker. They were the ones who set up the sale of the subj. land in
motion. Upon being informed by Flor that Medrano was selling mango orchard, Borbon lost no time
in informing Lee that they had found a property according to his specification.
LITONJUA VS ETERMIT CORP.
FACTS

Etermit Corp. manufactures roofing materials, and pipe products.90% of the share of stock
were owned by ESAC corp. Due to the political situation in the Philippines ESAC wanted to stop its
operation and dispose the one of its land. They engaged the services of realtor/broker Marquez.
Thereafter Marquez offered the land Lintojua and subsequently deposited money with the security
bank and trust.
Later when President Cory Aquino assumed the office the political situation improved.
Marquez received an instruction from the ESAC regional office decided not proceed with the sale. As
such Litonjua filed a complaint for specific performance of the aborted sale. Trial court and
Appellate court rendered judgment in favor of defendants and dismissed the complaint. The lower
court declared that since the authority of the agents/realtors was not in writing, the sale is void.
ISSUE

HELD