Philam v Arnaldo G.R. No.

76452July 26, 1994

J. Quiason
Facts:
One Ramon Paterno complained about the unfair practices committed by the
company against its agents, employees and consumers. The Commissioner called
for a hearing where Paterno was required to specify which acts were illegal. Paterno
then specified that the fees and charges stated in the Contract of Agency between
Philam and its agents be declared void. Philam, on the other hand, averred that
there Paterno must submit a verified formal complaint and that his letter didnt
contain information Philam was seeking from him. Philam then questioned the
Insurance Commissions jurisdiction over the matter and submitted a motion to
quash. The commissioner denied this. Hence this petition.
Issue: Whether or not the resolution of the legality of the Contract of Agency falls
within the jurisdiction of the Insurance Commissioner.
Held: No. Petition granted.
Ratio:
According to the Insurance code, the Insurance Commissioner was authorized to
suspend, directors, officers, and agents of insurance companies. In general, he was
tasked to regulate the insurance business, which includes:
(2)
The term "doing an insurance business" or "transacting an insurance
business," within the meaning of this Code, shall include
(a) making or proposing to make, as insurer, any insurance contract;
(b) making, or proposing to make, as surety, any contract of suretyship as a
vocation and not as merely incidental to any other legitimate business or activity of
the surety; (c) doing any kind of business, including a reinsurance business,
specifically recognized as constituting the doing of an insurance business within the
meaning of this Code; (d) doing or proposing to do any business in substance
equivalent to any of the foregoing in a manner designed to evade the provisions of
this Code. (Insurance Code, Sec. 2[2])
The contract of agency between Philamlife and its agents wasnt included with the
Commissoners power to regulate the business. Hence, the Insurance commissioner
wasnt vested with jurisidiction under the rule expresio unius est exclusion
alterius.
The respondent contended that the commissioner had the quasi-judicial power to
adjudicate under Section 416 of the Code. It stated:

The Commissioner shall have the power to adjudicate claims and complaints
involving any loss, damage or liability for which an insurer may be answerable
under any kind of policy or contract of insurance, or for which such insurer may be
liable under a contract of suretyship, or for which a reinsurer may be used under
any contract or reinsurance it may have entered into, or for which a mutual benefit
association may be held liable under the membership certificates it has issued to its
members, where the amount of any such loss, damage or liability, excluding
interest, costs and attorney's fees, being claimed or sued upon any kind of
insurance, bond, reinsurance contract, or membership certificate does not exceed in
any single claim one hundred thousand pesos.
This was, however, regarding complaints filed by the insured against the Insurance
company.
Also, the insurance code only discusses the licensing requirements for agents and
brokers. The Insurance Code does not have provisions governing the relations
between insurance companies and their agents.
Investment Planning Corporation of the Philippines v. Social Security Commissionthat an insurance company may have two classes of agents who sell its insurance
policies: (1) salaried employees who keep definite hours and work under the control
and supervision of the company; and (2) registered representatives, who work on
commission basis.
The agents under the 2nd sentence are governed by the Civil Code laws on agency.
This means that the regular courts have jurisdiction over this category.