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Fressel v Mariano Uy Chaco & Co.

Facts:

During the latter part of the year 1913, the defendant entered into a contract with one E. Merritt, whereby the said

Merritt undertook and agreed with the defendant to build for the defendant a costly edifice in the city of Manila at

the corner of Calle Rosario and Plaza del Padre Moraga. In the contract it was agreed between the parties thereto,that the defendant at any time, upon certain contingencies, before the completion of said edifice could take

possession of said edifice in the course of construction and of all the materials in and about said premises acquired

by Merritt for the construction of said edifice. During the month of August land past, the plaintiffs delivered to

Merritt at the said edifice in the course of construction certain materials of the value of P1,381.21, as per detailed list

hereto attached and marked Exhibit A, which price Merritt had agreed to pay on the 1st day of September, 1914. On

the 28th day of August, 1914, the defendant under and by virtue of its contract with Merritt took possession of the

incomplete edifice in course of construction together with all the materials on said premises including the materials

delivered by plaintiffs and mentioned in Exhibit A aforesaid. Neither Merritt nor the defendant has paid for the

materials mentioned in Exhibit A, although payment has been demanded, and that on the 2d day of September,

1914, the plaintiffs demanded of the defendant the return or permission to enter upon said premises and retake said

materials at the time still unused which was refused by defendant. In pursuance of the contract between Merritt and

the defendant, Merritt acted as the agent for defendant in the acquisition of the materials from plaintiffs.

Issue: Whether or not the contract entered into is an agency relation.

Decision:

It is a Contract for a piece of work. here the contract entered into is one where the individual undertook and agreed

to build for the other party a costly edifice, the underlying contract is one for a contract for a piece of work, and not

a principal and agency relation. Consequently, the contract is authorized to do the work according to his own

method and without being subject to the clients control, except as to the result of the work; he could purc hase his

materials and supplies from whom he pleased and at such prices as he desired to pay. And the mere fact that it was

stipulated in the contract that the client could take possession of the work site upon the happening of specified

contingencies did not make the relation into that of an agency. Consequently, when the client did take over the

unfinished works, he did not assume any direct liability to the suppliers of the contractor.

VILLA v GARCIA BOSQUE

FACTS:

A sale of property was made by the attorney in fact for a stated consideration, part of which was paid in cash

and the balance made payable in deferred instalments. The attorney in fact then executed a substituted

power of attorney in favor of a third person to enable the latter to collect the deferred instalments.

ISSUE:

Whether or not the appellant sureties are bound by Exhibit 1

DECISION:

Where the purchase price of property is payable in various installments, an extension of time granted by the

creditor to the debtor with respect to one instalment will discharge the sureties, whether simple or solidary,

from ALL liability as to such instalment bit it DOES NOT AFFECT their liability for other instalments

unconnected with the extension of time.

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. GONZALEZ and GOMEZ vs HABERERFacts: The plaintiff spouses executed a deed of sale over a tract of land with the defendant.It was stipulatedin their contract that if the plaintiffs were found by court to not bethe owners of the land, they would return any amount thatthe defendant had paid. Itwas also stipulated that Gomez gave his wife Gonzalez the marital license toexecute the deed.However, after making an initial payment of Php30,000, thedefendant found that the land was in the adverse possession ofmany others. Thus,he stopped making payments. The plaintiffs then filed an action to recover the sum of unpaid balance.

The defendant claimed that when they entered into this contract, theplaintiffs made false representations and mislead himinto thinking they had fullownership of the land.

Issue:WON Gonzalez was free of the liabilities that her husband incurred from themisrepresentations in the sale of the land

Held:NORationale:As to the plaintiffs contention that Gonzales cannot be charged by her husbandsmisrepresentation, it issufficient to say that the latter in negotiating for the sale of the land acted as an agent and representative of his wife; havingaccepted thebenefit of the representations of her agent she cannot, of course, escape liability forthem. The latter cannotaccept such benefits and at the same time deny theresponsibility for them.

Facts:

electrical business, and among other things in the sale of what is known as the "Matthews" electric plant.

o He claimed that he could find purchaser for the "Matthews" plant

o Keeler Electric told Montelibano that for any plant that he could sell or any customer that he could find

he would be paid a commission of 10% for his services, if the sale was consummated.

without the knowledge of Keeler Electric,

Electric filed an action against Rodriguez for the payment of the purchase price.

o Montelibano sold and delivered the plant to him, and "was the one who ordered the installation of that

electrical plant"o There were evidences: a statement and receipt which Montelibano signed to whom he paid the money.

o He paid Montelibano because the latter was the one who sold, delivered, and installed the electrical

plant, and he presented to him the account, and assured him that he was duly authorized to collect thevalue of the electrical plant

o The receipt had the following contents:

STATEMENT Folio No. 2494Mr. DOMINGO RODRIGUEZ, Iloilo, Iloilo, P.I.In account with HARRY E. KEELER ELECTRIC COMPANY, INC. 221 Calle Echaque, Quiapo, Manila,P.I. MANILA, P.I.,August 18, 1920.The answer alleges and the receipt shows upon its face that the plaintiff sold the plant to the defendant,and that he bought it from the plaintiff. The receipt is signed as follows:

Received paymentHARRY E. KEELER ELECTRIC CO. Inc.,Recibi (Sgd.) A. C. MONTELIBANO.

o Cenar was sent by Keeler Electric to install the plant in Rodriguezs premises in Iloilo

o He brought with him a statement of account for Rodriguez but the latter said that he would pay in

Manila.t: In favor of Rodriguez. It held that:

o Keeler Electric had held out Montelibano to Rodriguez as an agent authorized to collect

o Payment to Montelibano would discharge the debt of Rodriguez

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o The bill was given to Montelibano for collection purposes

o Montelibano had no authority to receive the money.

o His services were confined to the finding of purchasers for the "Matthews" plant

o Montelibano was not an electrician, could not install the plant and did not know anything about its

mechanism.

Issues:1. WON Keeler Electric authorized Montelibano to receive or receipt for money in its behalf

2. WON Rodriguez had a right to assume by any act or deed of Keeler Electric that Montelibano wasauthorized to receive the money

Held/Ratio:1. NO, Montelibano was not authorized. The plant was sold by Keeler Electric to Rodriguez and wasconsigned to Iloilo where it was installed by Cenar, acting for, and representing, Keeler Electric, whoseexpense for the trip is included in, and made a part of, the bill which was receipted by Montelibano.

a. Montelibano was not an agent of Keeler Electric

There is nothing on the face of this receipt to show that Montelibano was the agent of, or that he wasacting for, Keeler Electric. It is his own personal receipt and his own personal signature.

o Outside of the fact that Montelibano received the money and signed this receipt, there is no evidence

that he had any authority, real or apparent, to receive or receipt for the money.

o Neither is there any evidence that Keeler Electric ever delivered the statement to Montelibano. (It is

very apparent that the statement is the one which was delivered by Keeler Electric to Cenar, and is theone which Cenar delivered to Rodriguez)

b. It was Juan Cenar, and not Montelibano who sold the plant to Rodiguez

o The evidence is in direct conflict with Rodriguezs own p leadings and the receipt statement which he

offered in evidence. This statement also shows upon its face that P81.60 of the bill is round trip fare andmachines transportation costs.

o This claim must be for the expenses of Cenar in going to Iloilo from Manila and return, to install the

plant, and is strong evidence that it was Cenar and not Montelibano who installed the plant.

o If Montelibano installed the plant, there would not have been any necessity for Cenar to make this trip

at the expense of Rodriguez.

o After Cenar's return to Manila, Keeler Electric wrote a letter to Rodriguez requesting the payment of its

account, to which Rodriguez answered that he already paid to Montelibano.This is in direct conflict with the receipted statement, which Rodriguez offered in evidence, signed byMontelibano.

o It will be noted that the receipt which Montelibano signed is not dated, and it does not show when the

money was paid.

2. NO.

a. Relevant laws:

Article 1162 CC: Payment must be made to the persons in whose favor the obligation is constituted, orto another authorized to receive it in his name.

Article 1727 CC: The principal shall be liable as to matters with respect to which the agent hasexceeded his authority only when he ratifies the same expressly or by implication.

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Ormachea Tin-Conco vs. Trillana: The repayment of a debt must be made to the person in whose favorthe obligation is constituted, or to another expressly authorized to receive the payment in his name.

b. On whether an assumed authority exist Certain principles must be considered: (Mechem on Agency,volume I, section 743)

(1) that the law indulges in no bare presumptions that an agency exists: it must be proved or presumedfrom facts;

(2) that the agent cannot establish his own authority, either by his representations or by assuming toexercise it;

(3) that an authority cannot be established by mere rumor or general reputation;

(4)that even a general authority is not an unlimited one; and

(5) that every authority must find its ultimate source in some act or omission of the principal.Applying the above rules:

o Persons dealing with an assumed agent, whether the assumed agency be a general or special one,

are bound at their peril, if they would hold the principal, to ascertain not only the fact of the agency but thenature and extent of the authority, and in case either is controverted, the burden of proof is upon them toestablish it.

o The person dealing with the agent must act with ordinary prudence and reasonable diligence.

Obviously, if he knows or has good reason to believe that the agent is exceeding his authority, he cannotclaim protection. So if the suggestions of probable limitations be of such a clear and reasonable quality,or if the character assumed by the agent is of such a suspicious or unreasonable nature, or if theauthority which he seeks to exercise is of such an unusual or improbable character, the party dealing withhim may not shut his eyes to the real state of the case, but should either refuse to deal with the agent atall, or should ascertain from the principal the true condition of affairs.

Judgment of the lower court is REVERSED. Rodriguez should pay Keeler Electric the purchase price of the plant.

Barretto v Santa Maria

FACTS: The La Insular cigar and cigarette factory is a joint account association with a nominal

capital of P865,000, the plaintiff's share is P20,000, or 4/173 of the whole. The plaintiff'sattorneys wrote the defendant's local representative a letter offering to sell plaintiff's share in thefactory. The result of the correspondence between the parties and their representatives was thatExhibit G was duly executed on May 3, 1910. In accordance with the terms of this exhibit acommittee of appraisers was appointed to ascertain and fix the actual value of La Insular. Thecommittee rendered its report on November 14, 1910, fixing the net value at P4,428,194.44.Subsequently to the execution of Exhibit J, demand was made by the plaintiff upon the defendantfor his share of the profits from June 30, 1909, to November 22, 1910. This demand was refusedand thereupon this action was instituted to recover said profits.The plaintiff argued that if the agreement of May 3, 1910, was a perfected sale he cannotrecover any profits after that date; while on the other hand the defendant concedes that if saidagreement was only a promise to sell in the future it, standing alone, would not prevent recoveryin this action.ISSUE: Whether the agreement made by the parties on May 3, 1910 was a perfected contract of

sale.HELD: YES, it was a perfected contract of sale.Article 1450 of the Civil Code reads: "The sale shall be perfected between vendor andvendee and shall be binding on both of them, if they have agreed upon the thing which is theobject of the contract and upon the price, even when neither has been delivered."This is supplemented by Article 1447 of the Code which reads as follows: "In order that theprice may be considered fixed, it shall be sufficient that it be fixed with regard to anotherdetermine thing also specific, or that the determination of the same be left to the judgment of aspecified person."

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The contract of May 3, 1910, provides that:"Whereas the respective contracting partieshave agreed, the one to sell and the other to buy the whole of the right, title and interest of thesaid Antonio Maria Barretto in and to the said joint account association, including not only theindividual participation of the said party of the second part standing on the books of theassociation in the name of Antonio M. Barretto, but also one-half of the share in the businesswhich stands on the books in the name of Barretto & Company constituting a total nominal shareof P54,700 Philippine currency in the total nominal capital of P865,000 Philippine currencyUnder article 1450, supra there are two indispensable requisites in a perfected sale:(1) There must be an agreement upon the things which is the object of the contract; and (2)the contracting parties must agree upon the price. The object of the contract in the case atbar was the whole of the plaintiff's right, title, and interest in La Insular. This whole was4/173 of the entire net value of the business. The parties agreed that the price should be 4/173 ofthe total net value. The fixing of such net value was unreservedly left to the judgment of theappraisers. As to the thing and the price the minds of the contracting parties met, and allquestions relating thereto were settled. Nothing was left unfinished in so far as thecontracting parties were concerned. Neither party could withdraw from the contractwithout the consent of the other. The result is that the two essential requisites necessary toconstitute a perfected sale were present.We find that the parties did not only agree "the one to sell and the other to buy" and that"one will immediately sell and the other will immediately buy" the whole of the plaintiff's

interest but that they were unable to agree "as to the true present value of the said interest;" theydid agree, however, upon the method of fixing and determining such value by appointingappraisers for this purpose. It was the duty of the appraisers to hear the respective claims of theone and the other party relative to the value and assets of the business, "and in accordance withthe proof adduced relative to said values to fix and determine the same for the purposes of thepurchase and sale above mentioned." They did not say for the purpose of a sale to be made in thefuture. Is the language, "for the purposes of the purchase and sale above mentioned" any the lesssignificant or controlling than that relied upon by the plaintiff found in the first and fifthparagraph? When the parties used this language they had in mind the purchase and sale whichthey had just made. According to the ordinary and well-understood use of the words "purchase"and "sale" they mean, in the absence of any expression to limit their significance, a transmutationof property from one party to another in consideration of some price or recompense in value; atransmission of property by a voluntary act or agreement, founded on a valuable consideration;

divesting the title out of the vendor and vesting it in the vendee. Again, not only was the title ofthe plaintiff's interest vested in the defendant on the execution of the contract of May 3 but thepossession of that interest was also then transferred to the defendant. (Art. 1462, Civil Code; UyPiaoco vs. McMicking, 10 Phil. Rep., 286.)

Spouses Africa et al vs Caltex Philippines, Boquiren andthe Court of AppealsFacts: In March 1948, in Rizal Avenue, Manila, a tank truck was hosing gasoline into the underground storage of Caltex. Apparently,

a fire broke out from the gasoline station and the fire spread and burned several houses including the house of Africa. Allegedly,

someone (a passerby) threw a cigarette while gasoline was being transferred which caused the fire. But there was no evidence

presented to prove this theory and no other explanation can be had as to the real reason for the fire. Apparently also, Caltex and

the branch owner (Boquiren) failed to install a concrete firewall to contain fire if in case one happens.

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ISSUE: Whether or not Caltex and Boquiren are liable to pay for damages.

HELD:Yes. This is pursuant to the application on the principle of res ipsa loquitur (the transaction speaks for itself) which states:

where the thing which caused injury, without fault of the injured person, is under the exclusive control of the defendant and the

injury is such as in the ordinary course of things does not occur if he having such control use proper care, it affords reasonable

evidence, in the absence of the explanation, that the injury arose from defendants want of care. The gasoline station, with all its

appliances, equipment and employees, was under the control of Caltex and Boquiren. A fire occurred therein and spread to and

burned the neighboring houses. The persons who knew or could have known how the fire started were Boquiren, Caltex and their

employees, but they gave no explanation thereof whatsoever. It is a fair and reasonable inference that the incident happened

because of want of care.

Note that ordinarily, he who charges negligence shall prove it. However, res ipsa loquitur is the exception because the burden of

proof is shifted to the party charged of negligence as the latter is the one who had exclusive control of the thing that caused the

injury complained of.