PAT - Cases on Agency

7/23/2019 PAT - Cases on Agency

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G.R. No. L-24332 January 31, 1978

RAMON RALLOS, Administrator o t!" #stat" o $ON$#%$&ON RALLOS, '"tition"r,(s.

)#L&* GO $+AN SONS R#AL $OR%ORA&ON and $O/R O) A%%#ALS, r"s'ond"nts.

S"no, M"ndo0a Assoiat"s or '"tition"r.

Ramon ut"rt" or 'ri(at" r"s'ond"nt.

MUOZ PALMA, J.:

This is a case of an attorney-in-fact, Simeon Rallos, ho after of his !eath of his "rinci"al, #once"cionRallos, sol! the latter$s %n!i&i!e! share in a "arcel of lan! "%rs%ant to a "oer of attorney hich the"rinci"al ha! e'ec%te! in fa&or. The a!ministrator of the estate of the ent to co%rt to ha&e the sale!eclare! %neanforcea(le an! to reco&er the !is"ose! share. The trial co%rt )rante! the relief "raye! for,(%t %"on a""eal the #o%rt of A""eals %"hol! the &ali!ity of the sale an! the com"laint.

*ence, this Petition for Re&ie on certiorari.

The folloin) facts are not !is"%te!. #once"cion an! +er%n!ia (oth s%rname! Rallos ere sisters an!re)istere! co-oners of a "arcel of lan! non as Lot o. /01 of the #a!astral S%r&ey of #e(%co&ere! (y Transfer #ertificate of Title o. 22223 of the Re)istry of #e(%. On A"ril 42, 2/5, the sisters

e'ec%te! a s"ecial "oer of attorney in fa&or of their (rother, Simeon Rallos, a%thori6in) him to sell foran! in their (ehalf lot /01. On March 1, 2/, #once"cion Rallos !ie!. On Se"tem(er 24, 2/,Simeon Rallos sol! the %n!i&i!e! shares of his sisters #once"cion an! +er%n!ia in lot /01 to 7eli' +o#han 8 Sons Realty #or"oration for the s%m of P29,303./9. The !ee! of sale as re)istere! in theRe)istry of ee!s of #e(%, T#T o. 22220 as cancelle!, an! a ne transfer certificate of Title o.24/0/ as iss%e! in the name! of the &en!ee.

On May 20, 2/3 Ramon Rallos as a!ministrator of the ;ntestate that the #ertificate of $title iss%e! in the name of 7eli' +o #han 8Sons Realty #or"oration (e cancelle! an! another title (e iss%e! in the names of the cor"oration an!the @;ntestate estate of #once"cion Rallos@ in e%al %n!i&i!e! an! =1> that "laintiff (e in!emnifie! (y ay

of attorney$s fees an! "ayment of costs of s%it. ame! "arty !efen!ants ere 7eli' +o #han 8 SonsRealty #or"oration, Simeon Rallos, an! the Re)ister of ee!s of #e(%, (%t s%(se%ently, the latter as!ro""e! from the com"laint. The com"laint as amen!e! tice? !efen!ant #or"oration$s Ansercontaine! a crossclaim a)ainst its co-!efen!ant, Simon Rallos hile the latter file! thir!-"arty com"lainta)ainst his sister, +er%n!ia Rallos Bhile the case as "en!in) in the trial co%rt, (oth Simon an! hissister +er%n!ia !ie! an! they ere s%(stit%te! (y the res"ecti&e a!ministrators of their estates.

After trial the co%rt a %o ren!ere! C%!)ment ith the folloin) !is"ositi&e "ortion:

A. On Plaintiffs #om" laint D

=2> eclarin) the !ee! of sale, share of Lot /01 to the herein "laintiff?

=5> Sentencin) the !efen!ant J%an T. Horromeo, a!ministrator of the Sentencin) the co-!efen!ant J%an T. Horromeo, a!ministrator of the share of lot /01?

=4> Or!erin) co-!efen!ant J%an T. Horromeo, a!ministrator of the


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Bhat is the le)al effect of an act "erforme! (y an a)ent after the !eath of his "rinci"alI A""lie! more"artic%larly to the instant case, Be ha&e the %ery. is the sale of the %n!i&i!e! share of #once"cionRallos in lot /01 &ali! altho%)h it as e'ec%te! (y the a)ent after the !eath of his "rinci"alI Bhat is thela in this C%ris!iction as to the effect of the !eath of the "rinci"al on the a%thority of the a)ent to act foran! in (ehalf of the latterI ;s the fact of nole!)e of the !eath of the "rinci"al a material factor in!eterminin) the le)al effect of an act "erforme! after s%ch !eathI

Hefore "rocee!in)s to the iss%es, Be shall (riefly restate certain "rinci"les of la rele&ant to the mattertin!er consi!eration.

2. ;t is a (asic a'iom in ci&il la em(o!ie! in o%r #i&il #o!e that no one may contract in the nameof another itho%t (ein) a%thori6e! (y the latter, or %nless he has (y la a ri)ht to re"resent him. 1 Acontract entere! into in the name of another (y one ho has no a%thority or the le)al re"resentation orho has acte! (eyon! his "oers, shall (e %nenforcea(le, %nless it is ratifie!, e'"ressly or im"lie!ly, (ythe "erson on hose (ehalf it has (een e'ec%te!, (efore it is re&oe! (y the other contractin) "arty. 5Article 2591 =2> of the same #o!e also "ro&i!es:

ART. 2591. The folloin) contracts are %nenforcea(le, %nless they are C%stifie!:

=2> Those entere! into in the name of another "erson (y one ho hi - (een )i&en no a%thority orle)al re"resentation or ho has acte! (eyon! his "oers? ...

O%t of the a(o&e )i&en "rinci"les, s"r%n) the creation an! acce"tance of the relationshi" of a)ency

here(y one "arty, ca)e! the "rinci"al =man!ante>, a%thori6es another, calle! the a)ent =man!atario>, toact for an! in his (ehalf in transactions ith thir! "ersons. The essential elements of a)ency are: =2>there is consent, e'"ress or im"lie! of the "arties to esta(lish the relationshi"? =4> the o(Cect is thee'ec%tion of a C%ri!ical act in relation to a thir! "erson? =1> the a)ents acts as a re"resentati&e an! not forhimself, an! =5> the a)ent acts ithin the sco"e of his a%thority.

A)ency is (asically "ersonal re"resentati&e, an! !eri&ati&e in nat%re. The a%thority of the a)ent to actemanates from the "oers )rante! to him (y his "rinci"al? his act is the act of the "rinci"al if !one ithinthe sco"e of the a%thority. %i facit "er a li%m facit se. @*e ho acts thro%)h another acts himself@. 3

4. There are &ario%s ays of e'tin)%ishin) a)ency, K (%t her Be are concerne! only ith oneca%se D !eath of the "rinci"al Para)ra"h 1 of Art. 2/2/ of the #i&il #o!e hich as taen from Art.2K9/ of the S"anish #i&il #o!e "ro&i!es:

ART. 2/2/. A)ency is e'tin)%ishe!.

''' ''' '''

1. Hy the !eath, ci&il inter!iction, insanity or insol&ency of the "rinci"al or of the a)ent? ...= that the a)ent acte! itho%t noof the !eath of the "rinci"al an! =4> that the thir! "erson ho contracte! ith the a)ent himself ac)oo! faith. +oo! faith here means that the thir! "erson as not aare of the !eath of the "rinci"atime he contracte! ith sai! a)ent. These to re%isites m%st conc%r the a(sence of one ill renact of the a)ent in&ali! an! %nenforcea(le.

PAT CASE: AGENCY Page 2


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;n the instant case, it cannot (e %estione! that the a)ent, Simeon Rallos, ne of the !eath of his"rinci"al at the time he sol! the latter$s share in Lot o. /01 to res"on!ent cor"oration. The nole!)eof the !eath is clearly to (e inferre! from the "lea!in)s file! (y Simon Rallos (efore the trial co%rt. 24That Simeon Rallos ne of the !eath of his sister #once"cion is also a fin!in) of fact of the co%rt a %o21 an! of res"on!ent a""ellate co%rt hen the latter state! that Simon Rallos $m%st ha&e non of the!eath of his sister, an! yet he "rocee!e! ith the sale of the lot in the name of (oth his sisters#once"cion an! +er%n!ia Rallos itho%t informin) a""ellant =the realty cor"oration> of the !eath of theformer. 25

On the (asis of the esta(lishe! nole!)e of Simon Rallos concernin) the !eath of his "rinci"al#once"cion Rallos, Article 2/12 of the #i&il #o!e is ina""lica(le. The la e'"ressly re%ires for itsa""lication lac of nole!)e on the "art of the a)ent of the !eath of his "rinci"al? it is not eno%)h thatthe thir! "erson acte! in )oo! faith. Th%s in H%ason 8 Reyes &. Pan%yas, the #o%rt a""lyin) Article 2K10of the ol! #i&il ro!e no Art. 2/12 of the ne #i&il #o!e s%staine! the &ali!ity , of a sale ma!e after the!eath of the "rinci"al (eca%se it as not shon that the a)ent ne of his "rinci"al$s !emise. 2 To thesame effect is the case of *errera, et al., &. L%y im +%an, et al., 2/32, here in the or!s of J%sticeJes%s Harrera the #o%rt state!:

... e&en )rantin) ar)%emen!o that L%is *errera !i! !ie in 2/13, "laintiffs "resente! no "roof an! there isno in!ication in the recor!, that the a)ent L%y im +%an as aare of the !eath of his "rinci"al at thetime he sol! the "ro" erty. The !eath 3f the "rinci"al !oes not ren!er the act of an a)ent %nenforcea(le,here the latter ha! no nole!)e of s%ch e'tin)%ishment of the a)ency. =2 S#RA 593, 524>

5. ;n s%stainin) the &ali!ity of the sale to res"on!ent consi!eration the #o%rt of A""eals reasone!o%t that there is no "ro&ision in the #o!e hich "ro&i!es that hate&er is !one (y an a)ent ha&in)nole!)e of the !eath of his "rinci"al is &oi! e&en ith res"ect to thir! "ersons ho may ha&econtracte! ith him in )oo! faith an! itho%t nole!)e of the !eath of the "rinci"al. 23

Be cannot see the merits of the fore)oin) ar)%ment as it i)nores the e'istence of the )eneral r%leen%nciate! in Article 2/2/ that the !eath of the "rinci"al e'tin)%ishes the a)ency. That (ein) the )eneralr%le it follos a fortiori that any act of an a)ent after the !eath of his "rinci"al is &oi! a( initio %nless thesame fa)s %n!er the e'ce"tion "ro&i!e! for in the aforementione! Articles 2/19 an! 2/12. Article 2/12,(ein) an e'ce"tion to the )eneral r%le, is to (e strictly constr%e!, it is not to (e )i&en an inter"retation ora""lication (eyon! the clear im"ort of its terms for otherise the co%rts ill (e in&ol&e! in a "rocess ofle)islation o%tsi!e of their C%!icial f%nction.

. Another ar)%ment a!&ance! (y res"on!ent co%rt is that the &en!ee actin) in )oo! faith relie!on the "oer of attorney hich as !%ly re)istere! on the ori)inal certificate of title recor!e! in theRe)ister of ee!s of the "ro&ince of #e(%, that no notice of the !eath as a&er annotate! on sai!certificate of title (y the heirs of the "rinci"al an! accor!in)ly they m%st s%ffer the conse%ences of s%chomission. 2K

To s%""ort s%ch ar)%ment reference is ma!e to a "ortion in Manresa$s #ommentaries hich Be %o te:

;f the a)ency has (een )rante! for the "%r"ose of contractin) ith certain "ersons, the re&ocation(e ma!e non to them. H%t if the a)ency is )eneral iii nat%re, itho%t reference to "artic%lar "erith hom the a)ent is to contract, it is s%fficient that the "rinci"al e'ercise !%e !ili)ence to maere&ocation of the a)ency "%(licity non.

;n case of a )eneral "oer hich !oes not s"ecify the "ersons to hom re"resents$ on sho%l! (eit is the )eneral o"inion that all acts, e'ec%te! ith thir! "ersons ho contracte! in )oo! faith, Binole!)e of the re&ocation, are &ali!. ;n s%ch case, the "rinci"al may e'ercise his ri)ht a)ainst ta)ent, ho, noin) of the re&ocation, contin%e! to ass%me a "ersonality hich he no lon)er ha!

=Manresa ol. 22, "". 32 an! K? "". 2-23, rollo>

The a(o&e !isco%rse hoe&er, treats of re&ocation (y an act of the "rinci"al as a mo!e of terminaa)ency hich is to (e !istin)%ishe! from re&ocation (y o"eration of la s%ch as !eath of the "rinchich o(tains in this case. On "a)e si' of this O"inion Be stresse! that (y reason of the &ery natthe relationshi" (eteen "rinci"al an! a)ent, a)ency is e'tin)%ishe! i"so C%re %"on the !eath of e"rinci"al or a)ent. Altho%)h a re&ocation of a "oer of attorney to (e effecti&e m%st (e comm%nicthe "arties concerne!, 20 yet a re&ocation (y o"eration of la, s%ch as (y !eath of the "rinci"al isr%le, instantaneo%sly effecti&e inasm%ch as @(y le)al fiction the a)ent$s e'ercise of a%thority is re)as an e'ec%tion of the "rinci"al$s contin%in) ill. 2/ Bith !eath, the "rinci"al$s ill ceases or is thea%thority is e'tin)%ishe!.

The #i&il #o!e !oes not im"ose a !%ty on the heirs to notify the a)ent of the !eath of the "rinci"athe #o!e "ro&i!es in Article 2/14 is that, if the a)ent !ie his heirs m%st notify the "rinci"al thereof

the meantime a!o"t s%ch meas%res as the circ%mstances may !eman! in the interest of the latte*ence, the fact that no notice of the !eath of the "rinci"al as re)istere! on the certificate of title "ro"erty in the Office of the Re)ister of ee!s, is not fatal to the ca%se of the estate of the "rinci"

3. *ol!in) that the )oo! faith of a thir! "erson in sai! ith an a)ent affor!s the former s%ff"rotection, res"on!ent co%rt !re a @"arallel@ (eteen the instant case an! that of an innocent"%rchaser for &al%e of a lan!, statin) that if a "erson "%rchases a re)istere! lan! from one ho ait in (a! faith D e&en to the e'tent of fore)oin) or falsifyin) the !ee! of sale in his fa&or D the re)oner has no reco%rse a)ainst s%ch innocent "%rchaser for &al%e (%t only a)ainst the for)er. 49

To s%""ort the correctness of this res"on!ent cor"oration, in its (rief, cites the case of Hlon!ea%, ano an! alleCo, 32 Phil. 34. Be %ote from the (rief:

;n the case of An)el Hlon!ea% et al. &. A)%stin ano et al., 32 Phil. 319, one alleCo as a co-onlan!s ith A)%stin ano. The latter ha! a "oer of attorney s%""ose!ly e'ec%te! (y alleCo anofa&or. alleCo !eli&ere! to ano his lan! titles. The "oer as re)istere! in the Office of the Re)isee!s. Bhen the layer-h%s(an! of An)ela Hlon!ea% ent to that Office, he fo%n! all in or!er inthe "oer of attorney. H%t alleCo !enie! ha&in) e'ec%te! the "oer The loer co%rt s%staine! aan! the "laintiff Hlon!ea% a""eale!. Re&ersin) the !ecision of the co%rt a %o, the S%"reme #o%%otin) the r%lin) in the case of


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H%t there is a narroer )ro%n! on hich the !efenses of the !efen!ant- a""ellee m%st (e o&err%le!.A)%stin ano ha! "ossession of Jose alleCo$s title "a"ers. Bitho%t those title "a"ers han!e! o&er toano ith the ac%iescence of alleCo, a fra%! co%l! not ha&e (een "er"et%ate!. Bhen 7ernan!o !e la#anters, a mem(er of the Phili""ine Har an! the h%s(an! of An)ela Hlon!ea%, the "rinci"al "laintiff,searche! the re)istration recor!, he fo%n! them in !%e form incl%!in) the "oer of attorney of allaCo infa&or of ano. ;f this ha! not (een so an! if thereafter the "ro"er notation of the enc%m(rance co%l! notha&e (een ma!e, An)ela Hlon!ea% o%l! not ha&e sent P24,999.99 to the !efen!ant alleCo.$ Ane'ec%te! transfer of re)istere! lan!s "lace! (y the re)istere! oner thereof in the han!s of anothero"erates as a re"resentation to a thir! "arty that the hol!er of the transfer is a%thori6e! to !eal ith the

lan!.

As (eteen to innocent "ersons, one of hom m%st s%ffer the conse%ence of a (reach of tr%st, theone ho ma!e it "ossi(le (y his act of coinci!ence (ear the loss. ="". 2/-42>

The Hlon!ea% !ecision, hoe&er, is not on all fo%rs ith the case (efore Us (eca%se here Be areconfronte! ith one ho a!mitte!ly as an a)ent of his sister an! ho sol! the "ro"erty of the latterafter her !eath ith f%ll nole!)e of s%ch !eath. The sit%ation is e'"ressly co&ere! (y a "ro&ision of laon a)ency the terms of hich are clear an! %nmistaa(le lea&in) no room for an inter"retation contraryto its tenor, in the same manner that the r%lin) in Hlon!ea% an! the cases cite! therein fo%n! a (asis inSection of the Lan! Re)istration La hich in "art "ro&i!es:

''' ''' '''

The "ro!%ction of the oner$s !%"licate certificate hene&er any &ol%ntary instr%ment is "resente! forre)istration shall (e concl%si&e a%thority from the re)istere! oner to the re)ister of !ee!s to enter ane certificate or to mae a memoran!%m of re)istration in accor!ance ith s%ch instr%ments, an! thene certificate or memoran!%m Shall (e (in!in) %"on the re)istere! oner an! %"on all "ersonsclaimin) %n!er him in fa&or of e&ery "%rchaser for &al%e an! in )oo! faith: Pro&i!e! hoe&er, That in allcases of re)istration "ro&i!e! (y fra%!, the oner may "%rs%e all his le)al an! e%ita(le reme!iesa)ainst the "arties to s%ch fra%! itho%t "reC%!ice, hoe&er, to the ri)ht, of any innocent hol!er for &al%eof a certificate of title. ... =Act o. 5/ 3 as amen!e!>

K. One last "oint raise! (y res"on!ent cor"oration in s%""ort of the a""eale! !ecision is an 2054r%lin) of the S%"reme #o%rt of Pennsyl&ania in #assi!ay &. Mcen6ie herein "ayments ma!e to ana)ent after the !eath of the "rinci"al ere hel! to (e @)oo!@, @the "arties (ein) i)norant of the [email protected] %s tae note that the O"inion of J%stice Ro)ers as "remise! on the statement that the "arties erei)norant of the !eath of the "rinci"al. Be %ote from that !ecision the folloin):

... *ere the "recise "oint is, hether a "ayment to an a)ent hen the Parties are i)norant of the !eath isa )oo! "ayment. in a!!ition to the case in #am"(ell (efore cite!, the same C%!)e Lor! 404, 1/ Am. K3, here, in an ela(orate o"inion, this &ie(roa!ly anno%nce!. ;t is referre! to, an! seems to ha&e (een folloe!, in the case of ic &. Pa)Mo. 415, K Am 43K? (%t in this latter case it a""eare! that the estate of the !ecease! "rinci"al recei&e! the (enefit of the money "ai!, an! therefore the re"resentati&e of the estate mi)ht ell h(een hel! to (e esto""e! from s%in) for it a)ain. . . . These cases, in so far, at least, as they annothe !octrine %n!er !isc%ssion, are e'ce"tional. The Pennsyl&ania #ase, s%"ra =#assi!ay &. Mce

Batts 8 S. 404, 1/ Am K3>, is (elie&e! to stan! almost, if not %ite, al one in anno%ncin) the "ri nits (roa!est sco"e. =4, Misc. 11, 1K, cite! in 4 #.J. 5/>

So also in Tra&ers &. #rane, s"eain) of #assi!ay &. Mcen6ie, an! "ointin) o%t that the o"inion, so far as it relate! to the "artic%lar facts, as a mere !ict%m, Hal!in J. sai!:

The o"inion, therefore, of the learne! J%!)e may (e re)ar!e! more as an e'traC%!icial in!ication &ies on the )eneral s%(Cect, than as the a!C%!ication of the #o%rt %"on the "oint in %estion. H%taccor!in)ly all "oer ei)ht to this o"inion, as the C%!)ment of a of )reat res"ecta(ility, it stan!s amon) common la a%thorities an! is o""ose! (y an array too formi!a(le to "ermit %s to folloin#al. 24,2K, cite! in 4 #.J. 5/>

Bhate&er conflict of le)al o"inion as )enerate! (y #assi!ay &. Mcen6ie in American C%ris"r%!es%ch conflict e'ists in o%r on for the sim"le reason that o%r stat%te, the #i&il #o!e, e'"ressly "rofor to e'ce"tions to the )eneral r%le that !eath of the "rinci"al re&oes i"so C%re the a)ency, to that the a)ency is co%"le! ith an interest =Art 2/19>, an! =4> that the act of the a)ent as e'ec%itho%t nole!)e of the !eath of the "rinci"al an! the thir! "erson ho contracte! ith the a)enalso in )oo! faith =Art. 2/12>.


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"rinci"al ;n the case (efore Us the a)ent Ramon Rallos e'ec%te! the sale notithstan!in) notice of the!eath of his "rinci"al Accor!in)ly, the a)ent$s act is %nenforcea(le a)ainst the estate of his "rinci"al .

; ; arran)in) for !istri(%tion of American$s timeta(les, tariffs an! "romotional material to saa)ents an! the )eneral "%(lic in the assi)ne! territory?

=!> ser&icin) an! s%"er&isin) of sales a)ents =incl%!in) s%ch s%(-a)ents as may (e a""oinOrient Air Ser&ices ith the "rior ritten consent of American> in the assi)ne! territory incl%!in) ifre%ire! (y American the control of remittances an! commissions retaine!? an!

=e> hol!in) o%t a "assen)er reser&ation facility to sales a)ents an! the )eneral "%(lic in theassi)ne! territory.

;n connection ith sche!%le! or non-sche!%le! air "assen)er trans"ortation ithin the Unite! Staneither Orient Air Ser&ices nor its s%(-a)ents ill "erform ser&ices for any other air carrier similarthose to (e "erforme! here%n!er for American itho%t the "rior ritten consent of American. S%("erio!ic instr%ctions an! contin%e! consent from American, Orient Air Ser&ices may sell air "assetrans"ortation to (e "erforme! ithin the Unite! States (y other sche!%le! air carriers "ro&i!e!American !oes not "ro&i!e s%(stantially e%i&alent sche!%les (eteen the "oints in&ol&e!.

' ' ' ' ' ' ' ' '

5. Remittances

Orient Air Ser&ices shall remit in Unite! States !ollars to American the ticet stoc or e'chan)e orless commissions to hich Orient Air Ser&ices is entitle! here%n!er, not less fre%ently than semimonthly, on the 2th an! last !ays of each month for sales ma!e !%rin) the "rece!in) half month



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All monies collecte! (y Orient Air Ser&ices for trans"ortation sol! here%n!er on American$s ticet stocor on e'chan)e or!ers, less a""lica(le commissions to hich Orient Air Ser&ices is entitle! here%n!er,are the "ro"erty of American an! shall (e hel! in tr%st (y Orient Air Ser&ices %ntil satisfactorilyacco%nte! for to American.

. #ommissions

American ill "ay Orient Air Ser&ices commission on trans"ortation sol! here%n!er (y Orient AirSer&ices or its s%(-a)ents as follos:

=a> Sa les a)ency commiss ion

American ill "ay Orient Air Ser&ices a sales a)ency commission for all sales of trans"ortation (y OrientAir Ser&ices or its s%(-a)ents o&er American$s ser&ices an! any connectin) thro%)h air trans"ortation,hen ma!e on American$s ticet stoc, e%al to the folloin) "ercenta)es of the tariff fares an! char)es:

=i> 7or trans"ortation solely (eteen "oints ithin the Unite! States an! (eteen s%ch "oints an!#ana!a: KN or s%ch other rate=s> as may (e "rescri(e! (y the Air Traffic #onference of America.

=ii> 7or trans"ortation incl%!e! in a thro%)h ticet co&erin) trans"ortation (eteen "oints otherthan those !escri(e! a(o&e: 0N or s%ch other rate=s> as may (e "rescri(e! (y the ;nternational AirTrans"ort Association.

=(> O&erri!in) c ommission

;n a!!ition to the a(o&e commission American ill "ay Orient Air Ser&ices an o&erri!in) commission of1N of the tariff fares an! char)es for all sales of trans"ortation o&er American$s ser&ice (y Orient AirSer&ice or its s%(-a)ents.

' ' ' ' ' ' ' ' '

29. efa%lt

;f Orient Air Ser&ices shall at any time !efa%lt in o(ser&in) or "e rformin) any of the "ro&isions of thisA)reement or shall (ecome (anr%"t or mae any assi)nment for the (enefit of or enter into anya)reement or "romise ith its cre!itors or )o into li%i!ation, or s%ffer any of its )oo!s to (e taen ine'ec%tion, or if it ceases to (e in (%siness, this A)reement may, at the o"tion of American, (e terminate!forthith an! American may, itho%t "reC%!ice to any of its ri)hts %n!er this A)reement, tae "ossessionof any ticet forms, e'chan)e or!ers, traffic material or other "ro"erty or f%n!s (elon)in) to American.

22. ;ATA an! AT# R%les

The "ro&isions of this A)reement are s%(Cect to any a""lica(le r%les or resol%tions of the ;nternatiTrans"ort Association an! the Air Traffic #onference of America, an! s%ch r%les or resol%tions shacontrol in the e&ent of any conflict ith the "ro&isions hereof.

' ' ' ' ' ' ' ' '

21. Termination

American may terminate the A)reement on to !ays$ notice i n the e&ent Orient Air Ser&ices is %natransfer to the Unite! States the f%n!s "a ya(le (y Orient Air Ser&ices to American %n!er this A)re

. 7o%r =5> !ays later, or on 2 May 2/02, American Air instit%te! s%it a)ainst Orient Athe #o%rt of 7irst ;nstance of Manila, Hranch 45, for Acco%ntin) ith Preliminary Attachment or+arnishment, Man!atory ;nC%nction an! Restrainin) Or!er 5 a&errin) the aforesai! (asis for thetermination of the A)reement as ell as therein !efen!ant$s "re&io%s recor! of fail%res @to "rom"t"ast o%tstan!in) ref%n!s of hich there ere a&aila(le f%n!s in the "ossession of the !efen!ant,

the !ama)e an! "reC%!ice of "laintiff.@

;n its Anser 3 ith co%nterclaim !ate! / J%ly 2/02, !efen!ant Orient Air !enie! the material alle)of the com"laint ith res"ect to "laintiff$s entitlement to alle)e! %nremitte! amo%nts, conten!in) tafter a""lication thereof to the commissions !%e it %n!er the A)reement, "laintiff in fact still oe! Air a (alance in %n"ai! o&erri!in) commissions. 7%rther, the !efen!ant conten!e! that the action(y American Air in the co%rse of terminatin) the A)reement as ell as the termination itself ere%ntena(le, Orient Air claimin) that American Air$s "reci"ito%s con!%ct ha! occasione! "reC%!ice to(%siness interests.

7in!in) that the recor! an! the e&i!ence s%(stantiate! the alle)ations of the !efen!ant, the trial cr%le! in its fa&or, ren!erin) a !ecision !ate! 23 J%ly 2/05, the !is"ositi&e "ortion of hich rea!s:

B*


7/150

Jan%ary 2, 2/02 %ntil s%ch reinstatement or sai! amo%nts in its Phili""ine "eso e%i&alent le)ally"re&ailin) at the time of "ayment "l%s le)al interest to commence from the filin) of the co%nterclaim %" tothe time of "ayment. 7%rther, "laintiff is !irecte! to "ay !efen!ant the amo%nt of One Million 7i&e*%n!re! Tho%san! =Pl,99,999.99> "esos as an! for e'em"lary !ama)es? an! the amo%nt of Three*%n!re! Tho%san! =P199,999.99> "esos as an! (y ay of attorney$s fees.

#osts a)ainst "laintiff. K

On a""eal, the ;nterme!iate A""ellate #o%rt =no #o%rt of A""eals> in a !ecision "rom%l)ate! on 4KJan%ary 2/03, affirme! the fin!in)s of the co%rt a %o on their material "oints (%t ith some

mo!ifications ith res"ect to the monetary aar!s )rante!. The !is"ositi&e "ortion of the a""ellateco%rt$s !ecision is as follos:

B*

Since Orient Air as alloe! to carry only the ticet stocs of American Air, an! the former not hao"te! to a""oint any s%(-a)ents, it is American Air$s contention that Orient Air can claim entitlemethe !is"%te! o&erri!in) commission (ase! only on ticete! sales. This is s%""ose! to (e the cleameanin) of the %n!erscore! "ortion of the a(o&e "ro&ision. Th%s, to (e entitle! to the 1N o&erri!commission, the sale m%st (e ma!e (y Orient Air an! the sale m%st (e !one ith the %se of AmeAir$s ticet stocs.

On the other han!, Orient Air conten!s that the contract%al sti"%lation of a 1N o&erri!in) commisco&ers the total re&en%e of American Air an! not merely that !eri&e! from ticete! sales %n!ertaOrient Air. The latter, in C%stification of its s%(mission, in&oes its !esi)nation as the e'cl%si&e +enSales A)ent of American Air, ith the corres"on!in) o(li)ations arisin) from s%ch a)ency, s%ch a"romotion an! solicitation for the ser&ices of its "rinci"al. ;n effect, (y &irt%e of s%ch e'cl%si&ity, @aof trans"ortation o&er American Air$s ser&ices are necessarily (y Orient Air.@ 22

;t is a ell settle! le)al "rinci"le that in the inter"retation of a contract, the entirety thereof m%st (into consi!eration to ascertain the meanin) of its "ro&isions. 24 The &ario%s sti"%lations in the com%st (e rea! to)ether to )i&e effect to all. 21 After a caref%l e'amination of the recor!s, the #o%rtmerit in the contention of Orie nt Air that the A)reement, hen inter"rete! in accor!ance ith the



8/150

fore)oin) "rinci"les, entitles it to the 1N o&erri!in) commission (ase! on total re&en%e, or as referre! to(y the "arties, @total flon re&en%e.@

As the !esi)nate! e'cl%si&e +eneral Sales A)ent of American Air, Orient Air as res"onsi(le for the"romotion an! maretin) of American Air$s ser&ices for air "assen)er trans"ortation, an! the solicitationof sales therefor. ;n ret%rn for s%ch efforts an! ser&ices, Orient Air as to (e "ai! commissions of to =4>in!s: first, a sales a)ency commission, ran)in) from K-0N of tariff fares an! char)es from sales (yOrient Air hen ma!e on American Air ticet stoc? an! secon!, an o&erri!in) commission of 1N of tarifffares an! char)es for all sales of "assen)er trans"ortation o&er American Air ser&ices. ;t is imme!iatelyo(ser&e! that the "recon!ition attache! to the first ty"e of commission !oes not o(tain for the secon!

ty"e of commissions. The latter ty"e of commissions o%l! accr%e for sales of American Air ser&icesma!e not on its ticet stoc (%t on the ticet stoc of other air carriers sol! (y s%ch carriers or othera%thori6e! ticetin) facilities or tra&el a)ents. To r%le otherise, i.e., to limit the (asis of s%ch o&erri!in)commissions to sales from American Air ticet stoc o%l! erase any !i stinction (eteen the to =4>ty"es of commissions an! o%l! lea! to the a(s%r! concl%sion that the "arties ha! entere! into acontract ith meanin)less "ro&isions. S%ch an inter"retation m%st at all times (e a&oi!e! ith e&eryeffort e'erte! to harmoni6e the entire A)reement.

An a!!itional "oint (efore finally !is"osin) of this iss%e. ;t is clear from the recor!s that American Air asthe "arty res"onsi(le for the "re"aration of the A)reement. #onse%ently, any am(i)%ity in this @contractof a!hesion@ is to ( e taen @contra "roferentem@, i.e., constr%e! a)ainst the "arty ho ca%se! theam(i)%ity an! co%l! ha&e a&oi!e! it (y the e'ercise of a little more care. Th%s, Article 21KK of the #i&il#o!e "ro&i!es that the inter"retation of o(sc%re or!s or sti"%lations in a contract shall not fa&or the"arty ho ca%se! the o(sc%rity. 25 To "%t it !ifferently, hen se&eral inter"retations of a "ro&ision are

otherise e%ally "ro"er, that inter"retation or constr%ction is to (e a!o"te! hich is most fa&ora(le tothe "arty in hose fa&or the "ro&ision as ma!e an! ho !i! not ca%se the am(i)%ity. 2 Be thereforea)ree ith the res"on!ent a""ellate co%rt$s !eclaration that:

Any am(i)%ity in a contract, hose terms are s%sce"ti(le of !ifferent inter"retations, m%st (e rea!a)ainst the "arty ho !rafte! it. 23

Be no t%rn to the "ro"riety of American Air$s termination of the A)reement. The res"on!ent a""ellateco%rt, on this iss%e, r%le! th%s:

;t is not !enie! that Orient ithhel! remittances (%t s%ch action fin!s C%stification from "ara)ra"h 5 of theA)reement,


9/150

Hefore Us is a "etition for re&ie (y certiorari assailin) the ecision2 of the #o%rt of A""eals !ate! 29A%)%st 4995 an! its Resol%tion4 !ate! 2K March 499 in #A-+.R. SP o. K21/K entitle!, @, ilocate! at 53-A !el Rosario Street, #e(% #ity, here he may (e ser&e! s%mmons an! other "rocethe *onora(le #o%rt.

2.1. efen!ant

A st%!y of Anne' @+@ to the com"laint shos that in the ee! of Assi)nment, !efen!ant


10/150

the !on "ayment of P9,999.99. Plaintiff, therefore, cannot say that it as !ecei&e! (y !efen!ant

;n &ie of the 7ore)oin), the #o%rt !irects that !efen!ant

hich, hoe&er, affirme! the 4/ Jan%ary 4994 Or!er of the co%rt a %o. The !is"ositi&e "ortion of theno assaile! ecision of the #o%rt of A""eals states:

B* consent, e'"ress or im"lie!, of the "arties to estathe relationshi"? =4> the o(Cect is the e'ec%tion of a C%ri!ical act in relation to a thir! "erson? =1> theacts as a re"resentati&e an! not for himself? =5> the a)ent acts ithin the sco"e of his a%thority.15

;n this case, the "arties !o not !is"%te the e'istence of the a)ency relationshi" (eteen res"on!e


11/150

The "oers of an a)ent are "artic%larly (roa! in the case of one actin) as a )eneral a)ent or mana)er?s%ch a "osition "res%""oses a !e)ree of confi!ence re"ose! an! in&estit%re ith li(eral "oers for thee'ercise of C%!)ment an! !iscretion in transactions an! concerns hich are inci!ental or a""%rtenant tothe (%siness entr%ste! to his care an! mana)ement. ;n the a(sence of an a)reement to the contrary, amana)in) a)ent may enter into any contracts that he !eems reasona(ly necessary or re%isite for the"rotection of the interests of his "rinci"al entr%ste! to his mana)ement. ' ' '.1

A""lyin) the fore)oin) to the "resent case, e hol! that

As e !eclare that res"on!ent


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%rin) the trial of the ci&il case, "etitioners claime! that e)anos acte! as the a)ent of Hri)i!a . L%6hen he recei&e! the s%(Cect items of Ceelry an!, (eca%se he faile! to "ay for the same, Hri)i!a, as"rinci"al, an! her s"o%se are soli!arily lia(le ith him therefor.

On the other han!, hile e)anos a!mitte! that he ha! an %n"ai! o(li)ation to "etitioners, he claime!that the same as only in the s%m of P104,023.99 an! not PK4,531./0. *e f%rther asserte! that it ashe alone ho as in&ol&e! in the transaction ith the "etitioners? that he neither acte! as a)ent for noras he a%thori6e! to act as an a)ent (y Hri)i!a . L%6, notithstan!in) the fact that si' of the recei"tsin!icate! that the items ere recei&e! (y him for the latter. *e f%rther claime! that he ne&er !eli&ere!any of the items he recei&e! from "etitioners to Hri)i!a.

Hri)i!a, on her "art, !enie! that she ha! anythin) to !o ith the transactions (eteen "etitioners an!e)anos. She claime! that she ne&er a%thori6e! e)anos to recei&e any item of Ceelry in her (ehalfan!, for that matter, neither !i! she act%ally recei&e any of the articles in %estion.

After trial, the co%rt (elo fo%n! that only e)anos as lia(le to "etitioners for the amo%nt an! !ama)esclaime!. ;t hel! that hile Hri)i!a . L%6 !i! ha&e transactions ith "etitioners in the "ast, the itemsin&ol&e! ere alrea!y "ai! for an! all that Hri)i!a oe! "etitioners as the s%m of P42,501.99re"resentin) interest on the "rinci"al acco%nt hich she ha! "re&io%sly "ai! for.3

The trial co%rt also fo%n! that it as "etitioner Ly!ia Hor!a!or ho in!icate! in the recei"ts that the itemsere recei&e! (y e)anos for ne&er a%thori6e! her (rother =e)anos> tfor an! in her (ehalf in any transaction ith Petitioners ' ' '. 2 ;t is clear, therefore, that e&enass%min) ar)%en!o that e)anos acte! as an a)ent of Hri)i!a, the latter ne&er a%thori6e! him toher (ehalf ith re)ar! to the transactions s%(Cect of this case.

The #i&il #o!e "ro&i!es:

Art. 2030. Hy the contract of a)ency a "erson (in!s himself to ren!er some ser&ice or to !o somere"resentation or on (ehalf of another, ith the consent or a%thority of the latter.

The (asis for a)ency is re"resentation. *ere, there is no shoin) that Hri)i!a consente! to the ace)anos or a%thori6e! him to act on her (ehalf, m%ch less ith res"ect to the "artic%lar transactiin&ol&e!. Petitioners attem"t to foist lia(ility on res"on!ent s"o%ses thro%)h the s%""ose! a)ency

relation ith e)anos is )ro%n!less an! ill-a!&ise!.

Hesi!es, it as )rossly an! ine'c%sa(ly ne)li)ent of "etitioners to entr%st to e)anos, not once o(%t on at least si' occasions as e&i!ence! (y si' recei"ts, se&eral "ieces of Ceelry of s%(stantialitho%t re%irin) a ritten a%thori6ation from his alle)e! "rinci"al. A "erson !ealin) ith an a)ent%"on in%iry an! m%st !isco&er %"on his "eril the a%thority of the a)ent. 23



13/150

The recor!s sho that neither an e'"ress nor an im"lie! a)ency as "ro&en to ha&e e'iste! (eteene)anos an! Hri)i!a . L%6.


14/150

e'"erience, that official !%ty has (een re)%larly "erforme!? 4K that the "rocee!in)s of a C%!icial tri(%nalare re)%lar an! &ali!, an! that C%!icial acts an! !%ties ha&e (een an! ill (e !%ly an! "ro"erly"erforme!. 40 The (%r!en of "ro&in) irre)%larity in official con!%ct is on the "art of "etitioners an! theyha&e %tterly faile! to !o so. ;t is th%s re"rehensi(le for them to cast as"ersions on a co%rt of la on the(ases of conCect%res or s%rmises, es"ecially since one of the "etitioners a""ears to (e a mem(er of thePhili""ine Har.

Lastly, "etitioners fa%lt the trial co%rts hol!in) that hate&er contract of a)ency as esta(lishe! (eteenHri)i!a . L%6 an! arciso e)anos is %nenforcea(le %n!er the Stat%te of 7ra%!s as that as"ect of thiscase alle)e!ly is not co&ere! there(y. 4/ They "rocee! on the "remise that the Stat%te of 7ra%!sa""lies only to e'ec%tory contracts an! not to e'ec%te! or to "artially e'ec%te! ones. 7rom there, theymo&e on to claim that the contract in&ol&e! in this case as an e'ec%te! contract as the items ha!alrea!y (een !eli&ere! (y "etitioners to Hri)i!a . L%6, hence, s%ch !eli&ery res%lte! in the e'ec%tion ofthe contract an! remo&e! the same from the co&era)e of the Stat%te of 7ra%!s.

Petitioners claim is s"ecio%sly %nmeritorio%s. ;t sho%l! (e em"hasi6e! that neither the trial co%rt nor thea""ellate co%rt cate)orically state! that there as s%ch a contract%al relation (eteen these tores"on!ents. The trial co%rt merely sai! that if there as s%ch an a)ency e'istin) (eteen them, thesame is %nenforcea(le as the contract o%l! fall %n!er the Stat%te of 7ra%!s hich re%ires the"resentation of a note or memoran!%m thereof in or!er to (e enforcea(le in co%rt. That as merely a"re"aratory statement of a "rinci"le of la. Bhat as finally "ro&en as a matter of fact is that there asno s%ch contract (eteen Hri)i!a . L%6 an! arciso e)anos, e'ec%te! or "artially e'ec%te!, an! no!eli&ery of any of the items s%(Cect of this case as e&er ma!e to the former.

B*


15/150

terms of the ori)inal contract of lease hich are re&i&e! in the im"lie! ne lease %n!er Article 23K9 ofthe e #i&il #o!e are only those terms hich are )ermane to the lessees ri)ht of contin%e! enCoymentof the "ro"erty lease!. Therefore, an im"lie! ne lease !oes not i"so facto carry ith it any im"lie!re&i&al of "ri&ate res"on!ents o"tion to "%rchase =as lessee thereof> the lease! "remises. The"ro&ision entitlin) the lessee the o"tion to "%rchase the lease! "remises is not !eeme! incor"orate! inthe im"lie!ly renee! contract (eca%se it is alien to the "ossession of the lessee. Pri&ate res"on!entsri)ht to e'ercise the o"tion to "%rchase e'"ire! ith the termination of the ori)inal contract of lease forone year.

1. ;.? ;.? #OTRA#T O7 SAL


16/150

the "artial "ayment, an! to fi' the "erio! to "ay the (alance. ;n an Or!er !ate! Octo(er 4, 2/0, thetrial co%rt !enie! the iss%ance of a rit of "reliminary inC%nction on the )ro%n! that the !ecision of thethen #ity #o%rt for the eC ectment of the "ri&ate res"on!ent, ha&in) (een affirme! (y the then;nterme!iate A""ellate #o%rt an! the S%"reme #o%rt, has (ecome final an! e'ec%tory.

Una(le to sec%re an inC%nction, "ri&ate res"on!ent also file! (efore the RT# of %e6on #ity, Hranch 294=#i&il #ase o. -5350K> on o&em(er 2, 2/0 a com"laint for Ann%lment of an! Relief from J%!)mentith inC%nction an! !ama)es. ;n its !ecision3 !ate! May 24, 2/03, the trial co%rt !ismisse! thecom"laint for ann%lment on the )ro%n! of res C%!icata, an! the rit of "reliminary inC%nction "re&io%slyiss%e! as !issol&e!. ;t also or!ere! "ri&ate res"on!ent to "ay P1,999.99 as attorney$s fees. As aconse%ence of "ri&ate res"on!ent$s motion for reconsi!eration, the "reliminary inC%nction asreinstate!, there(y restrainin) the e'ec%tion of the #ity #o%rt$s C%!)ment on the eCectment case.

The to cases ere thereafter consoli!ate! (efore the RT# of %e6on #ity, Hranch KK. On A"ril 40,2/0/, a !ecisionK as ren!ere! !ismissin) "ri&ate res"on!ent$s com"laint in #i&il #ase o. -552=s"ecific "erformance case> an! !enyin) its motion for reconsi!eration in #i&il #ase o. 5350K=ann%lment of the eCectment case>. The motion for reconsi!eration of sai! !ecision as lieise !enie!.

On a""eal,0 res"on!ent #o%rt of A""eals ren!ere! a !ecision/ %"hol!in) the C%ris!iction of the #ity#o%rt of %e6on #ity in the eCectment case. ;t also concl%!e! that there as a "erfecte! contract of sale(eteen the "arties on the lease! "remises an! that "%rs%ant to the o"tion to (%y a)reement, "ri&ateres"on!ent ha! ac%ire! the ri)hts of a &en!ee in a contract of sale. ;t o"ine! that the "ayment (y"ri&ate res"on!ent of P199,999.99 on J%ne 49, 2/K as "artial "ayment for the lease! "ro"erty, hich"etitioners acce"te! =thro%)h Alice A. i6on> an! for hich an official recei"t as iss%e!, as the

o"erati&e act that )a&e rise to a "erfecte! contract of sale, an! that for fail%re of "etitioners to !enyrecei"t thereof, "ri&ate res"on!ent can therefore ass%me that Alice A. i6on, actin) as a)ent of"etitioners, as a%thori6e! (y them to recei&e the money in their (ehalf. The #o%rt of A""eals entf%rther (y statin) that in fact, hat as entere! into as a @con!itional contract of sale@ hereinonershi" o&er the lease! "ro"erty shall not "ass to the "ri&ate res"on!ent %ntil it has f%lly "ai! the"%rchase "rice. Since "ri&ate res"on!ent !i! not consi)n to the co%rt the (alance of the "%rchase "ricean! contin%e! to occ%"y the s%(Cect "remises, it ha! the o(li)ation to "ay the amo%nt of P2,K99.99 inmonthly rentals %ntil f%ll "ayment of the "%rchase "rice. The !is"ositi&e "ortion of sai! !ecision rea!s:

@B*, then #ity #o%rt of %e6on #ity, Hra10, for e'ec%tion of the C%!)ment22 !ate! o&em(er 44, 2/04 hich as )rante! in a resol%tionJ%ne 4/, 2//4. Pri&ate res"on!ent file! a motion to reconsi!er sai! resol%tion hich as !enie!.

A))rie&e!, "ri&ate res"on!ent file! a "etition for certiorari, "rohi(ition ith "reliminary inC%nction arestrainin) or!er ith this #o%rt =+.R. os. 293K9-2> hich as !ismisse! in a resol%tion !ate!Se"tem(er 23, 2//4 on the )ro%n! that the same as a refile! case "re&io%sly !ismisse! for lacmerit. On o&em(er 43, 2//4, entry of C%!)ment as iss%e! (y this #o%rt.

On J%ly 25, 2//1, "etitioners file! an %r)ent e'-"arte motion for e'ec%tion of the !ecision in #i&il o. 10-4/2 ith the MT# of %e6on #ity, Hranch 10. On Se"tem(er 21, 2//1, the trial co%rt orthe iss%ance of a thir! alias rit of e'ec%tion. ;n !enyin) "ri&ate res"on!ent$s motion for reconsi!it or!ere! the imme!iate im"lementation of the thir! rit of e'ec%tion itho%t !elay.

On ecem(er 44, 2//1, "ri&ate res"on!ent file! ith the Re)ional Trial #o%rt =RT#> of %e6on #Hranch 295 a "etition for certiorari an! "rohi(ition ith "reliminary inC%nctionGrestrainin) or!er =SPPRO#. o. /1-20K44> challen)in) the enforcea(ility an! &ali!ity of the MT# C%!)ment as ell as or!er for its e'ec%tion.

On Jan%ary 22, 2//5, RT# of %e6on #ity, Hranch 295 iss%e! an or!er24 )rantin) the iss%ancerit of "reliminary inC%nction %"on "ri&ate res"on!ent$s "ostin) of an inC%nction (on! of P9,999.9

Assailin) the afore%ote! or!er after !enial of their motion for "artial reconsi!eration, "etitioners "etition21 for certiorari an! "rohi(ition ith a "rayer for a tem"orary restrainin) or!er an!Gor "reinC%nction ith the #o%rt of A""eals. ;n its !ecision,25 the #o%rt of A""eals !ismisse! the "etitior%le! that:

@The a&oe! "%r"ose of this "etition is to enCoin the "%(lic res"on!ent from restrainin) the eCectm

the "ri&ate res"on!ent. To )rant the "etition o%l! (e to allo the eCectment of the "ri&ate res"onBe cannot !o that no in &ie of the !ecision of this #o%rt in #A-+.R. # os. 421-5. Petitioalle)e! ri)ht to eCect "ri&ate res"on!ent has (een !emonstrate! to (e itho%t (asis in the sai! ci&The "etitioners ha&e (een shon, after all, to ha&e no ri)ht to eCect "ri&ate res"on!ents.



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B* ac%ire! the ri)hts of a &en!ee in a contract of sale, in effect, reco)ni6in) the ri)ht ofthe "ri&ate res"on!ent to "ossess the s%(Cect "remises. #onsi!erin) sai! !ecision, e sho%l! not alloeCectment? to !o so o%l! !ist%r( the stat%s %o of the "arties since the "etitioners are not in "ossessionof the s%(Cect "ro"erty. ;t o%l! (e %nfair an ! %nC%st to !e"ri&e the "ri &ate res"on!ent of its "ossessionof the s%(Cect "ro"erty after its ri)hts ha&e (een esta(lishe! in a s%(se%ent r%lin).

B* year ith o"tion to "%rchase. The contract oe'"ire! itho%t the "ri&ate res"on!ent, as lessee, "%rchasin) the "ro"erty (%t remaine! in "ossethereof. *ence, there as an im"licit reneal of the contract of lease on a monthly (asis. The othterms of the ori)inal contract of lease hich are re&i&e! in the im"lie! ne lease %n!er Article 23Kthe e #i&il #o!e44 are only those terms hich are )ermane to the lessees ri)ht of contin%e!enCoyment of the "ro"erty lease!.41 Therefore, an im"lie! ne lease !oes not i"so facto carry any im"lie! re&i&al of "ri&ate res"on!ent$s o"tion to "%rchase =as lessee thereof> the lease! "remThe "ro&ision entitlin) the lessee the o"tion to "%rchase the lease! "remises is not !eeme! incorin the im"lie!ly renee! contract (eca%se it is alien to the "ossession of the lessee. Pri&ate res"ori)ht to e'ercise the o"tion to "%rchase e'"ire! ith the termination of the ori)inal contract of leasone year. The rationale of this #o%rt is that:

This is a reasona(le constr%ction of the "ro&ision, hich is (ase! on the "res%m"tion that hen tlessor allos the lessee to contin%e enCoyin) "ossession of the "ro"erty for fifteen !ays after thee'"iration of the contract he is illin) that s%ch enCoyment shall (e for the entire "erio! corres"onthe rent hich is c%stomarily "ai! in this case %" to the en! of the month (eca%se the rent as "amonthly. ecessarily, if the "res%me! ill of the "arties refers to the enCoyment of "ossession the

"res%m"tion co&ers the other terms of the contract relate! to s%ch "ossession, s%ch as the amo%rental, the !ate hen it m%st (e "ai!, the care of the "ro"erty, the res"onsi(ility for re"airs, etc. Hs%ch "res%m"tion may (e in!%l)e! in ith res"ect to s"ecial a)reements hich (y nat%re are forethe ri)ht of occ%"ancy or enC oyment inherent in a contract of lease.45

Thir!. There as no "erfecte! contract of sale (eteen "etitioners an! "ri &ate res"on!ent. Pri&atres"on!ent ar)%e! that it !eli&ere! the chec of P199,999.99 to Alice A. i6on ho acte! as a)en"etitioners "%rs%ant to the s%""ose! a%thority )i&en (y "etitioner 7i!ela i6on, the "ayee thereofPri&ate res"on!ent f%rther conten!e! that "etitioners filin) of the eCectment case a)ainst it (ase! contract of lease ith o"tion to (%y hol!s "etitioners in esto""el to %estion the a%thority of "etitio7i!ela i6on. ;t insiste! that the "ayment of P199,999.99 as "artial "ayment of the "%rchase "riceconstit%te! a &ali! e'ercise of the o"tion to (%y.

Un!er Article 25K of the e #i&il #o!e, the contract of sale is "erfecte! at the moment there is

meetin) of min!s %"on the thin) hich is the o(Cect of the contract an! %"on the "rice. 7rom thatmoment, the "arties may reci"rocally !eman! "erformance, s%(Cect to the "ro&isions of the la)o&ernin) the form of contracts. Th%s, the elements of a contract of sale are consent, o(Ce ct, an!money or its e%i&alent. ;t (ears stressin) that the a(sence of any of these essential elements nethe e'istence of a "erfecte! contract of sale. Sale is a consens%al contract an! he ho alle)es it sho its e'istence (y com"etent "roof.4



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;n an attem"t to res%rrect the la"se! o"tion, "ri&ate res"on!ent )a&e P199,999.99 to "etitioners =thr%Alice A. i6on> on the erroneo%s "res%m"tion that the sai! amo%nt ten!ere! o%l! constit%te a"erfecte! contract of sale "%rs%ant to the contract of lease ith o"tion to (%y. There as no &ali!consent (y the "etitioners =as co-oners of the lease! "remises> on the s%""ose! sale entere! into (yAlice A. i6on, as "etitioners alle)e! a)en t, an! "ri&ate res"on!ent. The (asis for a)ency isre"resentation an! a "erson !ealin) ith an a)ent is "%t %"on in%iry an! m%st !isco&er %"on his "erilthe a%thority of the a)ent.43 As "ro&i!e! in Article 2030 of the e #i&il #o!e,4K there as noshoin) that "etitioners consente! to the act of Alice A. i6on nor a%thori6e! her to act on their (ehalfith re)ar! to her transaction ith "ri&ate res"on!ent. The most "r%!ent thin) "ri&ate res"on!ent sho%l!ha&e !one as to ascertain the e'tent of the a%thority of Alice A. i6on. Hein) ne) li)ent in this re)ar!,"ri&ate res"on!ent cannot see relief on the (asis of a s%""ose! a)ency.

;n Hacaltos #oal Mines &s. #o%rt of A""eals,40 e e'"laine! the r%le in !ealin) ith an a)ent:

. ;n the co%rse of their !ealin)s, "etitioner iss%e! se&eral Shi""in) ListGeli&ery Recei"=SLRs> to STM as "roof of "%rchases. Amon) these as SLR o. 2425M, hich )a&e rise to tinstant case. ate! Octo(er 23, 2/0/, SLR o. 2425M co&ers 4,999 (a)s of s%)ar. its in SLR o. 2425M for P 25,K9,999.99. #S# iss%e! one chec !ate! Octo(er 4, 2/0/ an! thrchecs "ost!ate! o&em(er 21, 2/0/ in "ayment. That same !ay, #S# rote "etitioner that it haa%thori6e! (y STM to ith!ra the s%)ar co&ere! (y SLR o. 2425M. o. 242Octo(er 23, 2/0/ in the total %antity of 4,999 (a)s.@5

On Octo(er 4K, 2/0/, STM iss%e! 23 checs in the total amo%nt of P12,/99,999.99 ith "etitione"ayee. The latter, in t%rn, iss%e! Official Recei"t o. 11K51 !ate! Octo(er 4K, 2/0/ acnole!)inrecei"t of the sai! checs in "ayment of 9,999 (a)s. Asi!e from SLR o. 2425M, sai! checs co&ere! SLR o. 2421.

Pri&ate res"on!ent #S# s%rren!ere! SLR o. 2 425M to the "etitioner$s ABA#O areho%se aalloe! to ith!ra s%)ar. *oe&er, after 4,999 (a)s ha! (een release!, "etitioner ref%se! to allf%rther ith!raals of s%)ar a)ainst SLR o. 2425M. #S# then sent "etitioner a letter !ate! Ja41, 2//9 informin) it that SLR o. 2425M ha! (een @sol! an! en!orse!@ to it (%t that it ha! (eeref%se! f%rther ith!raals of s%)ar from "etitioner$s areho%se !es"ite the fact that only 4,999 (

ha! (een ith!ran. #S# th%s in%ire! hen it o%l! (e alloe! to ith!ra the remainin) 41(a)s.

On Jan%ary 12, 2//9, "etitioner re"lie! that it co%l! not allo any f%rther ith!raals of s%)ar a)aSLR o. 2425M (eca%se STM ha! alrea!y !ith!ran all the s%)ar co&ere! (y the cleare! che



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On March 4, 2//9, #S# sent "etitioner a letter !eman!in) the release of the (alance of 41,999 (a)s.

Se&en !ays later, "etitioner reiterate! that all the s%)ar corres"on!in) to the amo%nt of STM$s cleare!checs ha! (een f%lly ith!ran an! hence, there o%l! (e no more !eli&eries of the commo!ity toSTM$s acco%nt. Petitioner also note! that #S# ha! re"resente! itself to (e STM$s a)ent as it ha!ith!ran the 4,999 (a)s a)ainst SLR o. 2425M @for an! in (ehalf@ of STM.

On A"ril 4K, 2//9, #S# file! a com"laint for s"ecific "erformance, !ocete! as #i&il #ase o. /9-2220.efen!ants ere Teresita ) Sy =!oin) (%siness %n!er the name of St. Therese Merchan!isin)> an!herein "etitioner. Since the former co%l! not (e ser&e! ith s%mmons, the case "rocee!e! onl y a)ainstthe latter. %rin) the trial, it as !isco&ere! that Teresita ) +o ho testifie! for #S# as the same

Teresita ) Sy ho co%l! not (e reache! thro%)h s%mmons.K #S#, hoe&er, !i! not (other to "%rs%eits case a)ainst her, (%t instea! %se! her as its itness.

#S#$s com"laint alle)e! that STM ha! f%lly "ai! "etitioner for the s%)ar co&ere! (y SLR o. 2425M.Therefore, the latter ha! no C%stification for ref%sin) !eli&ery of the s%)ar. #S# "raye! that "etitioner (eor!ere! to !eli&er the 41,999 (a)s co&ere! (y SLR o. 2425M an! so%)ht the aar! of P2,295,999.99in %nreali6e! "rofits, P1,999,999.99 as e'em"lary !ama)es, P4,499,999.99 as attorney$s fees an!liti)ation e'"enses.

Petitioner$s "rimary !efense a %o as that it as an %n"ai! seller for the 41,999 (a)s.0 Since STMha! alrea!y !ran in f%ll all the s%)ar corres"on!in) to the amo%nt of its cleare! checs, it co%l! nolon)er a%thori6e f%rther !eli&ery of s%)ar to #S#. Petitioner also conten!e! that it ha! no "ri&ity ofcontract ith #S#.

Petitioner e'"laine! that the SLRs, hich it ha! iss%e!, ere not !oc%ments of title, (%t mere !eli&eryrecei"ts iss%e! "%rs%ant to a series of transactions entere! into (eteen it an! STM. The SLRs"rescri(e! !eli&ery of the s%)ar to the "arty s"ecifie! therein an! !i! not a%thori6e the transfer of sai!"arty$s ri)hts an! interests.

Petitioner also alle)e! that #S# !i! not "ay for the SLR an! as act%ally STM$s co-cons"irator to!efra%! it thro%)h a misre"resentation that #S# as an innocent "%rchaser for &al%e an! in )oo! faith.Petitioner then "raye! that #S# (e or!ere! to "ay it the folloin) s%ms: P29,999,999.99 as moral!ama)es? P29,999,999.99 as e'em"lary !ama)es? an! P2,99,999.99 as attorney$s fees. Petitioner also"raye! that cross-!efen!ant STM (e or!ere! to "ay it P29,999,999.99 in e'em"lary !ama)es, an!P2,99,999.99 as attorney$s fees.

Since no settlement as reache! at "re-trial, the trial co%rt hear! the case on the merits.

As earlier state!, the trial co%rt ren!ere! its C%!)ment fa&orin) "ri&ate res"on!ent #S#, as follos:

@B*


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as only one of 44 SLRs iss%e! to STM an! since the latter ha! alrea!y ith!ran its f%ll %ota ofs%)ar %n!er the sai! SLR, #S# as alrea!y "recl%!e! from seein) !eli&ery of the 41,999 (a)s ofs%)ar.

Pri&ate res"on!ent #S# co%ntere! that the s%)ar "%rchases in&ol&in) SLR o. 2425M ere se"aratean! in!e"en!ent transactions an! that the !etails of the series of "%rchases ere containe! in a sin)lestatement ith a consoli!ate! s%mmary of cleare! chec "ayments an! s%)ar stoc ith!raals(eca%se this a more con&enient system than iss%in) se"arate statements for each "%rchase.

The a""ellate co%rt consi!ere! the folloin) iss%es: =a> Bhether or not the transaction (eteen"etitioner an! STM in&ol&in) SLR o. 2425M as a se"arate, in!e"en!ent, an! sin)le transaction? =(>

Bhether or not #S# ha! the ca"acity to s%e on its on on SLR o. 2425M? an! =c> Bhether or not#S# as (%yer from STM of the ri)hts to 4,999 (a)s of s%)ar co&ere! (y SLR o. 2425M co%l!com"el "etitioner to !eli&er 41,999 (a)s alle)e!ly %nith!ran.

On 7e(r%ary 45, 2//5, the #o%rt of A""eals ren!ere! its !ecision mo!ifyin) the trial co%rt$s C%!)ment, toit:

@B* Pay the costs of s%it.

@SO OR Pay costs of s%it.

@SO OR. The rationathis is to affor! the "arty a)ainst hom the e&i!ence is "resente! to o(Cect thereto if he !eems itnecessary. Plaintiff-a""ellee is, therefore, correct in its ar)%ment that sho that "lain tiff-a""eha! sent !eman! letters to !efen!ant-a""ellant asin) the latter to allo it to ith!ra the remain41,999 (a)s of s%)ar from SLR 2425M. efen!ant-a""ellant, on the other han!, alle)e! that s%!eli&ery to the STM corres"on!e! only to the &al%e of cleare! checs? an! that all s%)ar corres"ocleare! checs ha! (een ith!ran. efen!ant-a""ellant !i! not re(%t "laintiff-a""ellee$s assertio!i! not "resent e&i!ence to sho ho many (a)s of s%)ar ha! (een ith!ran a)ainst SLR o2425M, "recisely (eca%se of its theory that all sales in %estion ere a series of one sin)le transaan! ith!raal of s%)ar !e"en!e! on the clearin) of checs "ai! therefor.

@After a secon! loo at the e&i!ence, Be see no reason to o&ert%rn the fin!in)s of the trial co%rt o"oint.@21

*ence, the instant "etition, "ositin) the folloin) errors as )ro%n!s for re&ie:

@2. The #o%rt of A""eals erre! in not hol!in) that STM$s an! "ri&ate res"on!ent$s s"ecially inform"etitioner that res"on!ent as a%thori6e! (y (%yer STM to ith!ra s%)ar a)ainst SLR o. 242an! in o%r =STM> (ehalf,@ =em"hasis in the ori)inal> "ri&ate res"on!ent$s ith!rain) 4,999 (a)s s%)ar for STM, an! STM$s em"oerin) other "ersons as its a)ents to ith!ra s%)ar a)ainst theSLR o. 2425M, ren!ere! res"on!ent lie the other "ersons, an a)ent of STM as hel! in Rallos7eli' +o #han 8 Realty #or"., 02 S#RA 44, an! "recl%!e! it from s%(se%ently claimin) an! "r(ein) an assi)nee of SLR o. 2425M an! from s%in) (y itself for its enforcement (eca%se it aconcl%si&ely "res%me! to (e an a)ent =Sec. 4, R%le 212, R%les of #o%rt> an! esto""e! from !oin=Art. 2512, #i&il #o!e>.

@ 4. The #o%rt of A""eals erre! in manifestly an! ar(itrarily i)norin) an! !isre)ar!in) certain rele&

an! %n!is"%te! facts hich, ha! they (een consi!ere!, o%l! ha&e shon that "etitioner as note'ce"t for 3/ (a)s of s%)ar, an! hich o%l! C%stify re&ie of i ts concl%sion of facts (y this *onor#o%rt.

@ 1. The #o%rt of A""eals misa""lie! the la on com"ensation %n!er Arts. 24K/, 240 an! 2343 o#i&il #o!e hen it r%le! that com"ensation a""lie! only to cre!its from one SLR or contract an!



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those from to or more !istinct contracts (eteen the same "arties? an! erre! i n !enyin) "etitioner$sri)ht to setoff all its cre!its arisin) "rior to notice of assi)nment from other sales or SLRs a)ainst"ri&ate res"on!ent$s claim as assi)nee %n!er SLR o. 2425M, so as to e'tin)%ish or re!%ce its lia(ilityto 3/ (a)s, (eca%se the la on com"ensation a""lies "recisely to to or more !istinct contracts(eteen the same "arties =em"hasis in the ori)inal>.

@5. The #o%rt of A""eals erre! in concl%!in) that the settlement or li%i!ation of acco%nts in its s%(Cect matter (ein) )eneric, an! =(> the sale of s%)ar (ein) s%(Cect to its a&aila(ility atthe aaco areho%se, ma!e the sale con!itional an! "re&ente! STM or "ri&ate res"on!ent fromac%irin) title to the s%)ar? an! the non-a&aila(ility of s%)ar free! "etitioner from f%rther o(li)ation.

@3. The #o%rt of A""eals erre! in not hol!in) that the @clean han!s@ !octrine "recl%!e! res"on!ent fromseein) C%!icial reliefs =sic> from "etitioner, its only reme!y (ein) a)ainst its assi)nor.@25

Sim"ly state!, the iss%es no to (e resol&e! are:

=2>....Bhether or not the #o%rt of A""eals erre! in not r%lin) that #S# as an a)ent of STM an! hence,esto""e! to s%e %"on SLR o. 2425M as an assi)nee.

=4>....Bhether or not the #o%rt of A""eals erre! in a""lyin) the la on com"ensation to the transaction

%n!er SLR o. 2425M so as to "recl%!e "etitioner from offsettin) its cre!its on the other SLRs.=1>....Bhether or not the #o%rt of A""eals erre! in not r%lin) that the sale of s%)ar %n!er SLR o.2425M as a con!itional sale or a contract to sell an! hence free! "etitioner from f%rther o(li)ations.

=5>....Bhether or not the #o%rt of A""eals committe! an error of la in not a""lyin) the @clean han!s!octrine@ to "recl%!e #S# from seein) C%!icial relief.

The iss%es ill (e !isc%sse! in seriatim.

Anent the first iss%e, e fin! from the recor!s that "etitioner raise! this iss%e for the first time on a""eal.;t is settle! that an iss%e hich as not raise! !%rin) the trial in the co%rt (elo co%l! not (e raise! forthe first time on a""eal as to !o so o%l! (e offensi&e to the (asic r%les of fair "lay, C%stice, an! !%e"rocess.2 onetheless, the #o%rt of A""eals o"te! to a!!ress this iss%e, hence, no a matter for o%r

consi!eration.

Petitioner hea&ily relies %"on STM$s letter of a%thority alloin) #S# to ith!ra s%)ar a)ainst SLR o.2425M to sho that the latter as STM$s a)ent. The "ertinent "ortion of sai! letter rea!s:

@This is to a%thori6e #onsoli!ate! S%)ar #or"oration or its re"resentati&e to ith!ra for an! in o(ehalf =stress s%""lie!> the refine! s%)ar co&ere! (y Shi""in) ListGeli&ery Recei"t V Refine! S%=SR> o. 2425 !ate! Octo(er 23, 2/0/ in the total %antity of 4, 999 (a)s.@23

The #i&il #o!e !efines a contract of a)ency as follos:

@Art. 2030. Hy the contract of a)ency a "erson (in!s himself to ren!er some ser&ice or to !o somin re"resentation or on (ehal f of another, ith the consent or a%thority of the latter.@

;t is clear from Article 2030 that the ( asis of a)ency is re"resentation.2K On the "art of the "rincithere m%st (e an act%al intention to a""oint20 or an intention nat%rally infera(le from his or!s o

actions?2/ an! on the "art of the a)ent, there m%st (e an intention to acce"t the a""ointment anon it,49 an! in the a(sence of s%ch intent, there is )enerally no a)ency.42 One factor hich moclearly !istin)%ishes a)ency from other le)al conce"ts is control? one "erson - the a)ent - a)rees%n!er the control or !irection of another - the "rinci"al. ;n!ee!, the &ery or! @a)ency@ has comeconnote control (y the "rinci"al.44 The control factor, more than any other, has ca%se! the co%rtcontracts (eteen "rinci"al an! a)ent in a se"arate cate)ory.41 The #o%rt of A""eals, in fin!in)#S#, as not an a)ent of STM, o"ine!:

@This #o%rt has r%le! that here the relation of a)ency is !e"en!ent %"on the acts of the "arties, maes no "res%m"tion of a)ency, an! it is alays a fact to (e "ro&e!, ith the (%r!en of "roof re%"on the "ersons alle)in) the a)ency, to sho not only the fact of its e'istence, (%t also its nat%ree'tent =Antonio &s. (ehalf@ !i! not esta(lish an a)ency. Ultimately, hat is !ecisi&e is tintention of the "arties.43 That no a)ency as meant to (e esta(lishe! (y the #S# an! STM is shon (y #S#$s comm%nication to "etitioner that SLR o. 2425M ha! (een @sol! an! en!orse!4K The %se of the or!s @sol! an! en!orse!@ means that STM an! #S# inten!e! a contract of s



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an! not an a)ency. *ence, on this score, no error as committe! (y the res"on!ent a""ellate co%rthen it hel! that #S# as not STM$s a)ent an! co%l! in!e"en!ently s%e "etitioner.

On the secon! iss%e, "rocee!in) from the theory that the transactions entere! into (eteen "etitioneran! STM are (%t serial "arts of one acco%nt, "etitioner insists that its !e(t has (een offset (y its claim forSTM$s %n"ai! "%rchases, "%rs%ant to Article 24K/ of the #i&il #o!e.40 *oe&er, the trial co%rt fo%n!,an! the #o%rt of A""eals conc%rre!, that the "%rchase of s%)ar co&ere! (y SLR o. 2425M as ase"arate an! in!e"en!ent transaction? it as not a serial "art of a sin)le transaction or of one acco%ntcontrary to "etitioner$s insistence. an!(%yerGtra!er ass%mes f%ll res"onsi(ility therefore@4/

The afore%ote! terms an! con!itions clearly sho that "etitioner transferre! title to the s%)ar to the(%yer or his assi)nee %"on "ayment of the "%rchase "rice. Sai! terms clearly esta(lish a contract ofsale, not a contract to sell. Petitioner is no esto""e! from alle)in) the contrary. The contract is the la(eteen the contractin) "arties.19 An! here the terms an! con!itions so sti"%late! are not contrary tola, morals, )oo! c%stoms, "%(lic "olicy or "%(l ic or!er, the contract is &ali! an! m%st (e %"hel!.12*a&in) transferre! title to the s%)ar in %estion, "etitioner is no o(li)e! to !eli&er it to the "%rchaser orits assi)nee.

As to the fo%rth iss%e, "etitioner s%(mits that STM an! "ri&ate res"on!ent #S# ha&e entere! into acons"iracy to !efra%! it of its s%)ar. This cons"iracy is alle)e!ly e&i!ence! (y: =a> the fact that STM$ssellin) "rice to #S# as (elo its "%rchasin) "rice? =(> #S#$s ref%sal to "%rs%e its case a)ainst Teresita) +o? an! =c> the a%thority )i&en (y the latter to other "ersons to ith!ra s%)ar a)ainst SLR o.2425M after she ha! sol! her ri)hts %n!er sai! SLR to #S#. Petitioner "rays that the !octrine of @cleanhan!s@ sho%l! (e a""lie! to "recl%!e #S# from seein) C%!icial relief. *oe&er, !es"ite caref%l scr%tiny,

e fin! here the recor!s (are of con&incin) e&i!ence hatsoe&er to s%""ort the "etitioner$s alle)ationsof fra%!. Be are no constraine! to !eem this matter "%rely s"ec%lati&e, (ereft of concrete "roof.

B*


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The 7acts

The facts are narrate! (y the #A as follos:

@Res"on!ents alle)e! that (eteen the "erio! of May 4, 2/00 an! J%ne , 2/00, s"o%ses Leonilo an!Maria T%a6on "%rchase! a total of 0,143 ca&ans of rice from the !ecease! Hartolome Ramos"re!ecessor-in-interest of res"on!ents. That of this %antity, ' ' ' only 5,51K ca&ans ha&e (een "ai!for so far, lea&in) %n"ai! 1,00/ ca&ans &al%e! at P2,422,/2/.99. ;n "ayment therefor, the s"o%sesT%a6on iss%e! ' ' ' se&eral Tra!ers Royal Han checs.

' ' ' ' ' ' ' ' '

H%t hen these checs ere encashe!, all of the checs (o%nce! !%e to ins%fficiency of f%n!s.Res"on!ents a!&ance! that (efore iss%in) sai! checs, s"o%ses T%a6on alrea!y ne that they ha!no a&aila(le f%n! to s%""ort the checs, an! they faile! to "ro&i!e for the "ayment of these !es"itere"eate! !eman!s ma!e on them.

@Res"on!ents a&erre! that (eca%se s"o%ses T%a6on antici"ate! that they o%l! (e s%e!, theycons"ire! ith the other !efen!ants to !efra%! them as cre!itors (y e'ec%tin) ' ' ' fictitio%s sales oftheir "ro"erties. They e'ec%te! ' ' ' sim%late! sales of three lots in fa&or of the ' ' ' s"o%sesH%ena&ent%ra ' ' ', as ell as their resi!ential lot an! the ho%se thereon, all locate! at %e&a


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Bell-entrenche! is the r%le that the S%"reme #o%rtQs role in a "etition %n!er R%le 5 is limite! tore&iein) errors of la alle)e!ly committe! (y the #o%rt of A""eals. 7act%al fin!in)s of the trial co%rt,es"ecially hen affirme! (y the #A, are concl%si&e on the "arties an! this #o%rt.0 Petitioners ha&e not)i&en %s s%fficient reasons to !e&iate from this r%le.

;n a contract of a)ency, one (in!s oneself to ren!er some ser&ice or to !o somethin) in re"resentation oron (ehalf of another, ith the latter Qs consent or a%thority./ The folloin) are the elements of a)ency: =2>the "artiesQ consent, e'"ress or im"lie!, to esta(lish the relationshi"? =4> the o(Cect, hich is thee'ec%tion of a C%ri!ical act in relation to a thir! "erson? =1> the re"resentation, (y hich the one ho actsas an a)ent !oes so, not for oneself, (%t as a re"resentati&e? =5> the limitation that the a)ent acts ithinthe sco"e of his or her a%thority.29 As the (asis of a)ency is re"resentation, there m%st (e, on the "art

of the "rinci"al, an act%al intention to a""oint, an intention nat%rally infera(le from the "rinci"alQs or!sor actions. ;n the same manner, there m%st (e an intention on the "art of the a)ent to acce"t thea""ointment an! act %"on it. A(sent s%ch m%t%al intent, there is )enerally no a)ency.22

This #o%rt fin!s no re&ersi(le error in the fin!in)s of the co%rts a %o that "etitioners ere the rice(%yers themsel&es? they ere not mere a)ents of res"on!ents in their rice !ealershi". The %estion ofhether a contract is one of sale or of a)ency !e"en!s on the intention of the "arties.24

The !eclarations of a)ents alone are )enerally ins%fficient to esta(lish the fact or e'tent of theira%thority.21 The la maes no "res%m"tion of a)ency? "ro&in) its e'istence, nat%re an! e'tent isinc%m(ent %"on the "erson alle)in) it.25 ;n the "resent case, "etitioners raise the fact of a)ency as anaffirmati&e !efense, yet fail to "ro&e its e'istence.

The #o%rt notes that "etitioners, on their on (ehalf, s%e!


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The "etitioner an! the res"on!ent a"oleon +%tierre6 =+%tierre6> entere! into a (%siness &ent%re %n!erthe name of Slam %n #or"oration =Sl%m %n>, a "ro!%ction o%tfit that "ro!%ce! mini-concerts an!shos relate! to (aset(all. Petitioner as alrea!y then a !ecorate! "rofessional (aset(all "layer hile+%tierre6 as a ell-non s"orts col%mnist.

;n the co%rse of their (%siness, the "etitioner "re-si)ne! se&eral checs to anser for the e'"enses ofSlam %n. Altho%)h si)ne!, these checs ha! no "ayeeQs name, !ate or amo%nt. The (lan checsere entr%ste! to +%tierre6 ith the s"ecific instr%ction not to fill them o%t itho%t "re&io%s notification toan! a""ro&al (y the "etitioner. Accor!in) to "etitioner, the arran)ement as ma!e so that he co%l! &erifythe &ali!ity of the "ayment an! mae the "ro"er arran)ements to f%n! the acco%nt.

;n the mi!!le of 2//1, itho%t the "etitionerQs nole!)e an! consent, +%tierre6 ent to Marasi)an =the"etitionerQs former teammate>, to sec%re a loan in the amo%nt of P499,999.99 on the e'c%se that the"etitioner nee!e! the money for the constr%ction of his ho%se. ;n a!!ition to the "ayment of the "rinci"al,+%tierre6 ass%re! Marasi)an that he o%l! (e "ai! an interest of N "er month from March to May2//5.

After m%ch contem"lation an! tain) into acco%nt his relationshi" ith the "etitioner an! +%tierre6,Marasi)an acce!e! to +%tierre6Q re%est an! )a&e him P499,999.99 sometime in 7e(r%ary 2//5.+%tierre6 sim%ltaneo%sly !eli&ere! to Marasi)an one of the (lan checs the "etitioner "re-si)ne! ithPili"inas Han, +reenhills Hranch, #hec o. 42992K35 ith the (lan "ortions fille! o%t ith the or!sW#ashX WTo *%n!re! Tho%san! Pesos OnlyX, an! the amo%nt of WP499,999.99X. The %""er ri)ht "ortionof the chec corres"on!in) to the !ate as also fille! o%t ith the or!s WMay 41, 2//5X (%t the"etitioner conten!e! that the same as not ritten (y +%tierre6.

On May 45, 2//5, Marasi)an !e"osite! the chec (%t it as !ishonore! for the reason WA##OUT#LOS a #om"laint foreclaration of %llity of Loan an! Reco&ery of ama)es a)ainst +%tierre6 an! co-res"on!entMarasi)an. *e com"letely !enie! a%thori6in) the loan or the checQs ne)otiation, an! asserte! that he

as not "ri&y to the "artiesQ loan a)reement.

Only Marasi)an file! his anser to the com"laint. ;n the RT#Qs or!er !ate! ecem(er 44, 2//K,+%tierre6 as !eclare! in !efa%lt.

The R%lin) of the RT#

The RT# r%le! on 7e(r%ary 1, 4991 in fa&or of Marasi)an.5 ;t fo%n! that the "etitioner, in iss%in)"re-si)ne! (lan checs, ha! the intention of iss%in) a ne)otia(le instr%ment, al(eit ith s"ecificinstr%ctions to +%tierre6 not to ne)otiate or iss%e the chec itho%t his a""ro&al. Bhile %n!er Secof the e)otia(le ;nstr%ments La +%tierre6 ha! the "rima facie a%thority to com"lete the checsfillin) %" the (lans therein, the RT# r%le! that he !eli(erately &iolate! "etitionerQs s"ecific instr%can! too a!&anta)e of the tr%st re"ose! in him (y the latter.

onetheless, the RT# !eclare! Marasi)an as a hol!er in !%e co%rse an! accor!in)ly !ismisse! t"etitionerQs com"laint for !eclaration of n%llity of the loan. ;t or!ere! the "etitioner to "ay Marasi)aface &al%e of the chec ith a ri)ht to claim reim(%rsement from +%tierre6.

The "etitioner ele&ate! the case to the #o%rt of A""eals =#A>, insistin) that Marasi)an is not a ho!%e co%rse. *e conten!e! that hen Marasi)an recei&e! the chec, he ne that the same as a !ate, an! hence, incom"lete. *e also alle)e! that the loan as act%ally (eteen Marasi)an an!+%tierre6 ith his chec (ein) %se! only as a sec%rity.

The R%lin) of the #A

On Se"tem(er 45, 4990, the # A affirme! the RT# r%lin), altho%)h "remise! on !ifferent fact%al fiAfter caref%l analysis, the #A a)ree! ith the "etitioner that Marasi)an is not a hol!er in !%e co%he !i! not recei&e the chec in )oo! faith.

The #A also concl%!e! that the chec ha! (een strictly fille! o%t (y +%tierre6 in accor!ance ith "etitionerQs a%thority. ;t hel! that the loan may not (e n%llifie! since it is )ro%n!e! on an o(li)ationfrom la an! r%le! that the "etitioner is still lia(le to "ay Marasi)an the s%m of P499,999.99.

After the #A !enie! the s%(se%ent motion for reconsi!eration that folloe!, the "etitioner file! th"resent "etition for re&ie on certiorari %n!er R%le 5 of the Re&ise! R%les of #o%rt.

The Petition

The "etitioner ar)%es that: =2> there as no loan (eteen him an! Marasi)an since he ne&er a%tthe (orroin) of money nor the checQs ne)otiation to the latter? =4> % n!er Article 20K0 of the #i&ila s"ecial "oer of attorney is necessary for an in!i&i!%al to mae a loan or (orro money in (ehaanother? =1> the loan transaction as (eteen +%tierre6 an! Marasi)an, ith his chec (ein) %seas a sec%rity? =5> the chec ha! not (een com"letely an! strictly fille! o%t in accor!ance ith hisa%thority since the con!ition that the s%(Cect chec can only (e %se! "ro&i!e! there is "rior a""ro

from him, as not com"lie! ith? => e&en if the chec as strictly fille! %" as instr%cte! (y the "eMarasi)an is still not entitle! to claim the checQs &al%e as he as not a hol!er in !%e co%rse? an!reason of the (a! faith in the !ealin)s (eteen the res"on!ents, he is entitle! to claim for !ama)

The ;ss%es



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Re!%ce! to its (asics, the case "resents to %s the folloin) iss%es:#hanRo(lesirt%alali(rary

Bhether the contract of loan in the amo%nt of P499,999.99 )rante! (y res"on!ent Marasi)an to"etitioner, thro%)h res"on!ent +%tierre6, may (e n%llifie! for (ein) &oi!?

Bhether there is (asis to hol! the "etitioner lia(le for the "ayment of the P499,999.99 loan?

Bhether res"on!ent +%tierre6 has com"letely fille! o%t the s%(Cect chec strictly %n!er the a%thority)i&en (y the "etitioner? an!

Bhether Marasi)an is a hol!er in !%e co%rse.

The #o%rtQs R%lin)

The "etition is im"resse! ith merit.

Be note at the o%tset that the iss%es raise! in this "etition are essentially fact%al in nat%re. The main"oint of in%iry of hether the contract of loan may (e n%llifie!, hin)es on the &ery e'istence of thecontract of loan a %estion that, as "resente!, is essentially, one of fact. Bhether the "etitionera%thori6e! the (orroin)? hether +%tierre6 com"letely fille! o%t the s%(Cect chec strictly %n! er the"etitionerQs a%thority? an! hether Marasi)an is a hol!er in !%e co%rse are also %estions of fact, that, asa )eneral r%le, are (eyon! the sco"e of a R%le 5 "etition.

The r%le that %estions of fact are not the "ro"er s%(Cect of an a""eal (y certiorari, as a "etition forre&ie %n!er R%le 5 is limite! only to %estions of la, is not an a(sol%te r%le that a!mits of noe'ce"tions. One nota(le e'ce"tion is hen the fin!in)s of fact of (oth the trial co%rt an! the #A areconflictin), main) their re&ie necessary. ;n the "resent case, the tri(%nals (elo arri&e! at toconflictin) fact%al fin!in)s, al(eit ith the same concl%sion, i.e., !ismissal of the com"laint for n%llity ofthe loan. Accor!in)ly, e ill e'amine the "artiesQ e&i!ence "resente!.

;. Lia(ility Un!er the #ontract of Loan

The "etitioner sees to n%llify the contract of loan on the )ro%n! that he ne&er a%thori6e! the (orroin)of money. *e "oints to Article 20K0, "ara)ra"h K of the #i&il #o!e, hich e'"li citly re%ires a rittena%thority hen the loan is contracte! thro%)h an a)ent. The "etitioner conten!s that a(sent s%cha%thority in ritin), he sho%l! not (e hel! lia(le for the face &al%e of the chec (eca%se he as not a"arty or "ri&y to the a)reement.

#ontracts of A)ency May (e Oral UnlessThe La Re%ires a S"ecific 7orm

Article 2030 of the #i&il #o!e !efines a contract of a)ency as a contract here(y a "erson @(in!s himselfto ren!er some ser&ice or to !o somethin) in re"resentation or on (ehalf of another, ith the consent or

a%thority of the latter.@ A)ency may (e e'"ress, or im"lie! from the acts of the "rinci"al, from his sor lac of action, or his fail%re to re"%!iate the a)ency, noin) that another "erson is actin) on h(ehalf itho%t a%thority.

As a )eneral r%le, a contract of a)ency may (e oral.3 *oe&er, it m%st (e ritten hen the la ra s"ecific form, for e'am"le, in a sale of a "iece of lan! or any interest therein thro%)h an a)ent.

Article 20K0 "ara)ra"h K of the #i&il #o!e e'"ressly re%ires a s"ecial "oer of a%thority (efore a)ent can loan or (orro money in (ehalf of the "rinci"al, to it:#hanRo(lesirt%alali(rary

Art. 20K0. S"ecial "oers of attorney are necessary in the folloin) cases:

' ' ' '

=K> To loan or (orro money, %nless the latter act (e %r)ent an! in!is"ensa(le for the "reser&atiothin)s hich are %n!er a!ministration. =em"hasis s%""lie!>

Article 20K0 !oes not state that the a%thority (e in ritin). As lon) as the man!ate is e'"ress, s%ca%thority may (e either oral or ritten. Be %ne%i&oca(ly !eclare! in Lim Pin &. Liao Tian, et al.,Kthe re%irement %n!er Article 20K0 of the #i&il #o!e refers to the nat%re of the a%thori6ation an! nits form. He that as it may, the a%thority m%st (e !%ly esta(lishe! (y com"etent an! con&incin) e&other than the self ser&in) assertion of the "arty claimin) that s%ch a%thority as &er(ally )i&en,th%s:#hanRo(lesirt%alali(rary

The re%irements of a s"ecial "oer of attorney in Article 20K0 of the #i&il #o!e an! of a s"eciala%thority in R%le 210 of the R%les of #o%rt refer to the nat%re of the a%thori6ation an! not its formre%irements are met if there is a clear man!ate from the "rinci"al s"ecifically a%thori6in) the"erformance of the act. As early as 2/93, this #o%rt in Stron) &. +%tierre6-Re"i!e =3 Phil. 309> stathat s%ch a man!ate may (e either oral or ritten, the one &ital thin) (ein) that it shall (e e'"ressmore recently, Be state! that, if the s"ecial a%thority is not ritten, then it m%st (e !%ly esta(lishee&i!ence:

' ' ' the R%les re%ire, for attorneys to com"romise the liti)ation of their clients, a s"ecial a%thorithile the same !oes not state that the s"ecial a%thority (e in ritin) the #o%rt has e&ery reason te'"ect that, if not in ritin), the same (e !%ly esta(lishe! (y e&i!ence other than the self-ser&in)assertion of co%nsel himself that s%ch a%thority as &er(ally )i&en him. =*ome ;ns%rance #om"aUnite! States lines #om"any, et al., 42 S#RA 031? 033: icente &s. +eral!e6, 4 S#RA 429? 44=em"hasis s%""lie!>.

The #ontract of Loan


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A re&ie of the recor!s re&eals that +%tierre6 !i! not ha&e any a%thority to (orro money in (ehalf of the"etitioner. Recor!s !o not sho that the "etitioner e'ec%te! any s"ecial "oer of attorney =SPA> in fa&orof +%tierre6. ;n fact, the "etitionerQs testimony confirme! that he ne&er a%thori6e! +%tierre6 =or anyonefor that matter>, hether &er(ally or in ritin), to (orro money in his (ehalf, nor as he aare of anys%ch transaction:#hanRo(lesirt%alali(rary

AL; PATR;MO;O =itness>

ATTF. < .

This "rinci"le as also reiterate! in the case of +o6%n &. Merca!o,29 here this co%rthel!:#hanRo(lesirt%alali(rary

Petitioner s%(mits that his folloin) testimony s%ffices to esta(lish that res"on!ent ha! a%thori6e!to o(tain a loan from him.

' ' ' '

PetitionerQs testimony faile! to cate)orically state, hoe&er, hether the loan as ma!e on (ehalfres"on!ent or of his ife. Bhile "etitioner claims that Lilian as a%thori6e! (y res"on!ent, the staof acco%nt mare! as .

;n the a(sence of any shoin) of any a)ency relations or s"ecial a%thority to act for an! in (ehalf"etitioner, the loan a)reement +%tierre6 entere! into ith Marasi)an is n%ll an! &oi!. Th%s, the "eis not (o%n! (y the "artiesQ loan a)reement.

7%rthermore, that the "etitioner entr%ste! the (lan " re-si)ne! checs to +%tierre6 is not le)allys%fficient (eca%se the a%thority to enter into a loan can ne&er (e "res%me!. The contract of a)enthe s"ecial fi!%ciary relationshi" inherent in this contract m%st e'ist as a matter of fact. The "ersoalle)in) it has the (%r!en of "roof to sho, not only the fact of a)ency, (%t also its nat%re an! e'teAs e hel! in Peo"le &. Fa(%t:24cralare!

Mo!esto Fam(ao$s recei"t of the (a! checs from #ecilia %e Fa(%t or +eminiano Fa(%t, Jr., in#aloocan #ity cannot, contrary to the hol!in) of the res"on!ent J%!)es, (e licitly taen as !eli&erchecs to the com"lainant Alicia P. An!an at #aloocan #ity to fi' the &en%e there. *e !i! not tae!eli&ery of the checs as h ol!er, i.e., as @"ayee@ or @in!orsee.@ An! there a""ears to (e no contraa)ency (eteen Fam(ao an! An!an so as to (in! the latter for the acts of the former. Alicia P. An!eclare! in that sorn testimony (efore the in&esti)atin) fiscal that Fam(ao is (%t her @messen)e@"art-time em"loyee.@ There as no s"ecial fi!%ciary relationshi" that "ermeate! their !ealin)s. 7

contract of a)ency to e'ist, the consent of (oth "arties is essential, the "rinci"al consents that the"arty, the a)ent, shall act on his (ehalf, an! the a)ent consents so to act. ;t m%st e'ist as a fact. Tmaes no "res%m"tion thereof. The "erson al le)in) it has the (%r!en of "roof to sho, not only thof its e'istence, (%t also its nat%re an! e'tent. This is more im"erati&e hen it is consi!ere! that ttransaction !ealt ith in&ol&es checs, hich are not le)al ten!er, an! the cre!itor may &ali!ly refsame as "ayment of o(li)ation. =at ". 319>. =em"hasis s%""lie!>


any amo%nt ;n or!er hoe&er that any s%ch instr%ment hen com"lete! may (e enforce! a)ain


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The recor!s sho that Marasi)an merely relie! on the or!s of +%tierre6 itho%t sec%rin) a co"y of theSPA in fa&or of the latter an! itho%t &erifyin) from the "etitioner hether he ha! a%thori6e! the(orroin) of money or release of the chec. *e as th%s (o%n! (y the ris accom"anyin) his tr%st onthe mere ass%rances of +%tierre6.

o #ontract of Loan Bas Perfecte! HeteenMarasi)an An! Petitioner, as The LatterQs#onsent Bas ot O(taine!.

Another si)nificant "oint that the loer co%rts faile! to consi!er is that a contract of loan, lie any other

contract, is s%(Cect to the r%les ) o&ernin) the re%isites an! &ali!ity of contracts in )eneral.21 Article2120 of the #i&il #o!e25 en%merates the essential re%isites for a &ali! contract, namely:2. consent of the contractin) "arties?4. o(Cect certain hich is the s%(Cect matter of the contract? an!1. ca%se of the o(li)ation hich is esta(lishe!.;n this case, the "etitioner !enie! lia(ility on the )ro%n! that the contract lace! the essential element ofconsent. Be a)ree ith the "etitioner. As e e'"laine! a (o&e, +%tierre6 !i! not ha&e the "etitionerQsrittenG&er(al a%thority to enter into a contract of loan. Bhile there may (e a meetin) of the min!s(eteen +%tierre6 an! Marasi)an, s%ch a)reement cannot (in! the "etitioner hose consent as noto(taine! an! ho as not "ri&y to the loan a)reement. *ence, only +%tierre6 is (o%n! (y the contract ofloan.

Tr%e, the "etitioner ha! iss%e! se&eral "re-si)ne! checs to +%tierre6, one of hich fell into the han!s ofMarasi)an. This act, hoe&er, !oes not constit%te s%fficient a%thority to (orro money in his (ehalf an!neither sho%l! it (e constr%e! as "etitionerQs )rant of consent to the "artiesQ loan a)reement. Bitho%t anye&i!ence to "ro&e +%tierre6Q a%thority, the "etitionerQs si)nat%re in the chec cannot (e taen, e&enremotely, as s%fficient a%thori6ation, m%ch less, consent to the contract of loan. Bitho%t the consent)i&en (y one "arty in a "%r"orte! contract, s%ch contract co%l! not ha&e (een "erfecte!? there sim"lyas no contract to s"ea o f.2cralare!

Bith the loan iss%e o%t of the ay, e no "rocee! to !etermine hether the "etitioner can (e ma!elia(le %n!er the chec he si)ne!.

;;. Lia(ility Un!er the ;nstr%ment

The anser is s%""lie! (y the a""lica(le stat%tory "ro&ision fo%n! in

Section 25 of the e)otia(le ;nstr%ments La =;L> hich states:#hanRo(lesirt%alali(rary

Sec. 25. Hlans? hen may (e fille!. - Bhere the instr%ment is antin) in any material "artic%lar, the"erson in "ossession thereof has a "rima facie a%thority to com"lete it (y fillin) %" the (lans therein.An! a si)nat%re on a (lan "a"er !eli&ere! (y the "erson main) the si)nat%re in or!er that the "a"ermay (e con&erte! into a ne)otia(le instr%ment o"erates as a "rima facie a%thority to fill it %" as s%ch for

any amo%nt. ;n or!er, hoe&er, that any s%ch instr%ment hen com"lete! may (e enforce! a)ain"erson ho (ecame a "arty thereto "rior to its com"letion, it m%st (e fille! %" strictly in accor!ancthe a%thority )i&en an! ithin a reasona(le time. H%t if any s%ch instr%ment, after com"letion, isne)otiate! to a hol!er in !%e co%rse, it is &ali! an! effect%al for all "%r"oses in his han!s, an! he enforce it as if it ha! (een fille! %" strictly in accor!ance ith the a%thority )i&en an! ithin a reastime.

This "ro&ision a""lies to an incom"lete (%t !eli&ere! instr%ment. Un!er this r%le, if the maer or !!eli&ers a "re-si)ne! (lan "a"er to another "erson for the "%r"ose of con&ertin) it into a ne)otiainstr%ment, that "erson is !eeme! to ha&e "rima facie a%thority to fill it %". ;t merely re%ires that instr%ment (e in the "ossession of a "erson other than the !raer or maer an! from s%ch "osse

to)ether ith the fact that the instr%ment is antin) in a material "artic%lar, the la "res%mes a)efill %" the (lans.23cralare!

;n or!er hoe&er that one ho is not a hol!er in !%e co%rse can enforce the instr%ment a)ainst a "rior to the instr%mentQs com"letion, to re%isites m%st e'ist: =2> that the (lan m%st (e fille! striaccor!ance ith the a%thority )i&en? an! =4> it m%st (e fille! %" ithin a reasona(le time. ;f it as that the instr%ment ha! not (een fille! %" strictly in accor!ance ith the a%thority )i&en an! ithinreasona(le time, the maer can set this %" as a "ersonal !efense an! a&oi! lia(ili ty. *oe&er, if thol!er is a hol!er in !%e co%rse, there is a concl%si&e "res%m"tion that a%thority to fill it %" ha! (e)i&en an! that the same as not in e'cess of a%thority.2Kcralare!

;n the "resent case, the "etitioner conten!s that there is no le)al (asis to hol! him lia(le (oth %n!contract an! loan an! %n!er the chec (eca%se: first, the s%(Cect chec as not com"letely fille! strictly %n!er the a%thority he has )i&en an! secon!, Marasi)an as not a hol!er in !%e co%rse.

Marasi)an is ot a *ol!er in %e #o%rse

The e)otia(le ;nstr%ments La =;L> !efines a hol!er in !%e co%rse, th%s:#hanRo(lesirt%ala

Sec. 4 D A hol!er in !%e co%rse is a hol!er ho has taen the instr%ment %n!er the folloin)con!itions:

=a> That it is com"lete an! re)%lar %"on its face?

=(> That he (ecame the hol!er of it (efore it as o&er!%e, an! itho%t notice that it ha! (een "re&!ishonore!, if s%ch as the fact?

=c> That he too it in )oo! faith an! for &al%e?

=!> That at the time it as ne)otiate! to him he ha! no notice of any infirmity in the instr%ment or !in the title of the "erson ne)otiatin) it. =em"hasis s%""lie!>


Section 4=c> of the ;L states that a hol!er in !%e co%rse is one ho taes the instr%ment Win )oo! faith Fes Sina(i niya sa ain na ailan)an ay%sin na (a)o "a ma%i sa %n) saan an) tseen) t%mal


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Section 4=c> of the ;L states that a hol!er in !%e co%rse is one ho taes the instr%ment in )oo! faithan! for &al%e.X ;t also "ro&i!es in Section 4=!> that in or!er that one may (e a hol!er in !%e co%rse, it isnecessary that at the time it as ne)otiate! to him he ha! no notice of any infirmity in the instr%ment or!efect in the title of the "erson ne)otiatin) it.

Ac%isition in )oo! faith means tain) itho%t nole!)e or notice of e%ities of any sort hich co%l! (eset %" a)ainst a "rior hol!er of the instr%ment.20 ;t means that he !oes not ha&e any nole!)e of facthich o%l! ren!er it !ishonest for him to tae a ne)otia(le "a"er. The a(sence of the !efense, henthe instr%ment as taen, is the essential element of )oo! faith.2/cralare!

As hel! in e Ocam"o &. +atchalian:49cralare!

;n or!er to sho that the !efen!ant ha! Wnole!)e of s%ch facts that his action in tain) the instr%mentamo%nte! to (a! faith,X it is not necessary to "ro&e that the !efen!ant ne the e'act fra%! that as"ractice! %"on the "laintiff (y the !efen!ant$s assi)nor, it (ein) s%fficient to sho that the !efen!ant ha!notice that there as somethin) ron) a(o%t his assi)nor$s ac%isition of title, altho%)h he !i! not ha&enotice of the "artic%lar ron) that as committe!.

;t is s%fficient that the (%yer of a note ha! notice or nole!)e that the note as in some ay tainte!ith fra%!. ;t is not necessary that he sho%l! no the "artic%lars or e&en the nat%re of the fra%!, sinceall that is re%ire! is nole!)e of s%ch facts that his action in tain) the note amo%nte! (a! faith.

The term Y(a! faithQ !oes not necessar

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