Case Title: PRUDENTIAL BANK vs.

THE COURT OF APPEALS, AURORA CRUZ,

Facts:
On June 23, 1986, Aurora F. Cruz with her sister as co-depositor invested P200,000.00 in the
Prudential Bank with 13.75% annual interest and will mature in 63 days. The amount of
P196,122.88 was withdrawn from the depositors' Savings Account and applied to the
investment. The transaction was evidenced by a Confirmation of Sale together with a Debit
Memo in the amount withdrawn and applied to the confirmed sale that were issued by Susan
Quimbo, the employee of the bank. Upon maturity, Cruz returned to the bank to "roll-over" or
renew her investment. This time, Cruz was asked to sign a Withdrawal Slip for P196,122.98,
representing the amount to be re-invested as per the new requirement of the bank. On October
27, 1986, Cruz returned to the bank to withdraw her P200,000.00. However, she was informed
that the investment appeared to have been already withdrawn by her on August 25, 1986. Cruz
went to the bank to inquire about her request to withdraw but she received no definite answer,
hence, Cruz's file a complaint before RTC for breach of contract.  The RTC ordered the
defendants to pay the damages for Cruz. However, the decision was affirmed in toto by the
Court of Appeals upon appeal by the bank. Petitioner bank elevated the case to the High Court
by Petition for Review on Certiorari.

Issue: Whether or not the Prudential Bank is liable to pay damages for Cruz based on its
agent’s acts of irregularity.

Ruling:
Yes. A banking corporation is liable to innocent third persons where the representation is made
in the course of its business by an agent acting within the general scope of his authority even
though, in the particular case, the agent is secretly abusing his authority and attempting to
perpetrate a fraud upon his principal or some other person, for his own ultimate benefit 
The principal is liable for obligations contracted by the agent. The agent's apparent
representation yields to the principal's true representation and the contract is considered as
entered into between the principal and the third person.
Such liability dates back to the Roman Law maxim, Qui per alium facit per seipsum facere
videtur. "He who does a thing by an agent is considered as doing it himself."  
The bank has not explained the remarkable coincidence that the amount indicated in the
withdrawal slip is exactly the same amount Cruz was re-investing after deducting therefrom the
pre-paid interest. The bank has also not, succeeded in impugning the authenticity of the
Confirmation of Sale and the Debit Memo which were made on its official, forms. 
Roman Law Analysis:
In this case, G.R. No. 108957, the liability of the principal for the acts of the agent is not even
debatable. Law and jurisprudence are clearly and absolutely against the petitioner. Such liability
dates back to the Roman Law maxim, Qui per alium facit per seipsum facere videtur. "He who
does a thing by an agent is considered as doing it himself." This rule is affirmed by the Civil
Code thus:
Art. 1910. The principal must comply with all the obligations which the agent may have
contracted within the scope of his authority.
Art. 1911. Even when the agent has exceeded his authority, the principal is solidarily liable with
the agent if the former allowed the latter to act as though he had full powers.
Conformably, we have declared in countless decisions that the principal is liable for obligations
contracted by the agent. The agent's apparent representation yields to the principal's true
representation and the contract is considered as entered into between the principal and the third
person. 
G.R. No. L-33849 August 18, 1977

Facts:
Gabino Diaz died in 1962. On October 20, 1964 Severa Mendoza and her two children, Andrea
Diaz and Angel Diaz, executed a deed of donation denominated as over one-half of Lot No.
2377-A, which is a portion of Lot No. 2377 of the Lolomboy Friar Lands Estate. In that deed of
donation, Severa Mendoza donated to Andrea Diaz her one-half share in Lot 2377-A, which
one-half share is identified as Lot 2377-A-1, on condition that Andrea Diaz would bear the
funeral expenses to be incurred after the donor's death. In 1964, Severa Mendoza died. It
should be noted that the other one-half share in Lot 2377-A or Lot No. 2377-A-2 was previously
adjudicated to Angel Diaz because he defrayed the funeral expenses on the occasion of the
death of Gabino Diaz.
On May 12, 1970 Andrea Diaz sued her brother, Angel Diaz, for the partition of Lots Nos. 2377-
A and 2502. Teodorico Alejandro, the surviving spouse of Olimpia Diaz, and their children
intervened in the said case. They claimed one-third of Lot No. 2502. Angel Diaz alleged in his
answer that he had been occupying his share of Lot No. 2502 "for more than twenty years". The
intervenors claimed that the 1949 donation was a void mortis causa disposition.
The lower court rendered a partial decision on March 15, 1971 with respect to Lot No. 2377-A.
The case was continued with respect to Lot No. 2502 which is item No. 1 or (a) in the 1949
deed of donation. Moreover, the trial court in its decision of June 30, 1971 held that the said
deed of donation was a donation mortis causa because the ownership of the properties donated
did not pass to the donees during the donors' lifetime but was transmitted to the donees only
"upon the death of the donors".
Andrea Diaz and the Alejandro intervenors filed separate appeals. Andrea Diaz contends that
the 1949 deed of donation is a valid donation inter vivos and that the trial court erred in deleting
the award for attorney's fees.

Issue:  
(1) Whether or not the disputed Lot No, 2502 is donated by virtue of an inter vivos or mortis
causa transfer
(2) Whether or not the Alejandro intervenors is liable to pay attorney's fees.
Ruling:
(1) The donation in the instant case is inter vivos because it took effect during the lifetime of
the donors. It was already effective during the donors' lifetime, or immediately after the
execution of the deed, as shown by the granting, habendum and warranty clause of the
deed.
In that clause it is stated that, in consideration of the affection and esteem of the donors
for the donees and the valuable services rendered by the donees to the donors, the
 latter, by means of the deed of donation, wholeheartedly transfer and unconditionally
give to the donees the lots mentioned and described in the early part of the deed, free
from any kind of liens and debts. The acceptance clause is another indication that the
donation is inter vivos. Donations mortis causa , being in the form of a will, are never
accepted by the donees during the donors' lifetime. Acceptance is a requirement for
donations inter vivos.
In the reddendum or reservation clause of the deed of donation, it is stipulated that the
donees would shoulder the expenses for the illness and the funeral of the donors and
that the donees cannot sell to a third person the donated properties during the donors'
lifetime but if the sale is necessary to defray the expenses and support of the donors,
then the sale is valid. The limited right to dispose of the donated lots, which the deed
gives to the donees, implies that ownership had passed to them by means of the
donation and that, therefore, the donation was already effective during the donors'
lifetime. That is a characteristic of a donation inter vivos.
(2) No. After a careful consideration of the facts and circumstances of the case, particularly
the apparent good faith of the Alejandro intervenors in asserting a one-third interest in
the disputed lot and their close relationship to Andrea Diaz, we find that it is not proper to
require them to pay attorney's fees.
Roman Law Analysis:
G.R. No. 72873 May 28, 1987

Facts:
Five brothers and sisters inherited in equal pro indiviso shares a parcel of land. On March 15,
1963, one of them, Celestino Padua, transferred his undivided share of the herein petitioners for
the sum of P550.00 by way of absolute sale. One year later, Eustaquia Padua, his sister, sold
her own share to the same vendees, in an instrument denominated "Con Pacto de Retro Sale,"
for the sum of P 440.00. 
After the said sales, by virtue of such agreements, the petitioners occupied an area
corresponding to two-fifths of the said lot, representing the portions sold to them. The vendees
subsequently enclosed the same with a fence. In 1975, with their consent, their son Eduardo
Alonzo and his wife built a semi-concrete house on a part of the enclosed area. Consequently,
Mariano Padua and Tecla Padua, herein coheirs, sought to redeem the area sold to the spouses
Alonzo, therefore, filed their own complaint invoking the same right of redemption.
However, the trial court also dismiss this complaint, now on the ground that the right had lapsed,
not having been exercised within thirty days from notice of the sales in 1963 and 1964. Although
there was no written notice, it was held that actual knowledge of the sales by the co-heirs
satisfied the requirement of the law.  On the other hand, in reversing the trial court, the
respondent court declared that the notice required by the said article was written notice and that
actual notice would not suffice as a substitute.

Issue: Whether or not the actual knowledge of the sales could satisfy the requirement under
Article 1088 which needed actual written notice.

Ruling:
Yes. In the face of the established facts, we cannot accept the private respondents' pretense
that they were unaware of the sales made by their brother and sister in 1963 and 1964. By
requiring written proof of such notice, we would be closing our eyes to the obvious truth in favor
of their palpably false claim of ignorance, thus exalting the letter of the law over its purpose. The
purpose is clear enough: to make sure that the redemptioners are duly notified. We are satisfied
that in this case the other brothers and sisters were actually informed, although not in writing, of
the sales made in 1963 and 1964, and that such notice was sufficient.
While we do not here declare that this period started from the dates of such sales in 1963 and
1964, we do say that sometime between those years and 1976, when the first complaint for
redemption was filed, the other co-heirs were actually informed of the sale and that thereafter
the 30-day period started running and ultimately expired. This could have happened any time
during the interval of thirteen years, when none of the co-heirs made a move to redeem the
properties sold. By 1977, in other words, when Tecla Padua filed her complaint, the right of
redemption had already been extinguished because the period for its exercise had already
expired.
It was the perfectly natural thing for the co-heirs to wonder why the spouses Alonzo, who were
not among them, should enclose a portion of the inherited lot and build thereon a house of
strong materials. This definitely was not the act of a temporary possessor or a mere mortgagee.
This certainly looked like an act of ownership. Yet, given this unseemly situation, none of the co-
heirs saw fit to object or at least inquire, to ascertain the facts, which were readily available. It
took all of thirteen years before one of them chose to claim the right of redemption, but then it
was already too late.
We realize that in arriving at our conclusion today, we are deviating from the strict letter of the
law, which the respondent court understandably applied pursuant to existing jurisprudence. The
said court acted properly as it had no competence to reverse the doctrines laid down by this
Court in the above-cited cases. In fact, and this should be clearly stressed, we ourselves are not
abandoning the De Conejero and Buttle doctrines. What we are doing simply is adopting an
exception to the general rule, in view of the peculiar circumstances of this case.

Roman Law Analysis:

G.R. No. 119777