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Macke vs Camps

Phil. 553 86


The plaintiffs in this action, B. H. Macke and W. H. Chandler, partners doing business under the firm name of
Macke, Chandler & Company, allege that during the months of February and March, 1905, they sold to the
defendant and delivered at his place of business, known as the "Washington Cafe," various bills of goods
amounting to P351.50; that the defendant has only paid on account of said accounts the sum of P174; that there is
still due them on account of said goods the sum of P177.50; that before instituting this action they made demand
for the payment thereof; and that defendant had failed and refused to pay the said balance or any part of it up to
the time of the filing of the complaint. Plaintiffs made demand for the payment from defendant and that the latter
failed and refused to pay the said balance or any part of it
Macke, one of the plaintiffs, testified that on the order of one Ricardo Flores, who represented himself to
be the agent of Jose Camps, he shipped the said goods to the defendant at the Washington Caf; that Flores
(agent) later acknowledged the receipt of the said goods and made various payments thereon amounting in all to
P174; that believes that Flores is still the agent of Camps; and that when he went to the Washington Caf for the
purpose of collecting his bill he found Flores, in the absence of Camps, apparently in charge of the business and
claiming to be the business manager of Camps, said business being that of a hotel with a bar and restaurant

A written contract was introduced as evidence, from which it appears that one Galmes, the former of
Washington Caf sub rented the building wherein the business was conducted, to Camps for 1 year for the
purpose of carrying on that business, Camps obligating himself not to sublet or sub rent the building or the business
without the consent of the said Galmes.

This contract was signed by Camps and the name of Ricardo Flores as a witness and attached thereon is an
inventory of the furniture and fittings which also is signed by Camps with the word sub lessee below the name,
and at the foot of this inventory the word received followed by the name Ricardo Flores with the words
managing agent immediately following his name.

Whether or not Ricardo Flores was the agent of Jose Camps


Yes. Evidence is sufficient to sustain a finding that Flores is the agent of Camps in the management of the bar
of the Washington Caf with authority to bind Camps, his principal, for the payment of the goods.

The contract sufficiently establishes the fact that Camps was the owner of the business and of the bar, and
the title of managing agent attached to the signature of Flores which appears on that contract, together with the
fact that at the time the purchases were made, Flores was apparently in charge of the business performing the
duties usually intrusted to a managing agent leave little room for doubt that he was there as the authorized agent
of Camps.
Agency by Estoppel --- One who clothes another with apparent authority as his agent, and holds him out to
the public as such, cannot be permitted to deny the authority of such person to act as his agent, to the prejudice of
innocent third persons dealing with such person in good faith and in the honest belief that he is what he appears to

Estoppel---- Whenever a party has, by his own declaration, act or omission, intentionally and deliberately
led another to believe a particular thing true, and to act upon such belief, he cannot, in any litigation arising out of
such declaration, act, or omission be permitted to falsify; and unless the contrary appears, the authority of the
agent must be presumed to include all the necessary and usual means of carrying his agency into effect. The
judgment of the trial court is affirmed with the costs of his instance against the appellant. After expiration of
twenty days judgment will be rendered in accordance herewith, and ten days thereafter the case remanded to
the lower court for proper action. So ordered.


Linan vs. Puno

31 Phil. 259 88

The plaintiff, in the month of May, 1908, and for a long time prior thereto, was the owner of a certain parcel of
land particularly described in paragraph 2 of the complaint. On the 16th day of May, 1908, the plaintiff executed
the following document, which conferred upon the defendant Marcos P. Puno the power, duties and obligations
therein contained:

I, Diego Lian, of age, married, a resident of Daet, Province of Ambos Camarines, Philippine Islands, and at the
present time temporarily residing in this city of Tarlac, capital of the Province of Tarlac, P.I., set forth that I hereby
confer sufficient power, such as the law requires, upon Mr. Marcos P. Puno, likewise a resident of this city of Tarlac,
capital of the Province of Tarlac, in order that in my name and representation he may administer the interest I
possess within this municipality of Tarlac, purchase, sell, collect and pay, as well as sue and be sued before any
authority, appear before the courts of justice and administrative officers in any proceeding or business concerning
the good administration and advancement of my said interests, and may, in necessary cases, appoint attorneys at
law or attorneys in fact to represent him.
The meaning, purport, and power conferred by this document constitute the very gist of the present action. That
in June, 1911, the defendant Puno, for the sum of P800, sold and delivered said parcel of land to the other

The plaintiff alleges that the said document did not confer upon Puno the power to sell the land and prayed that
the sale be set aside and that the land be returned to him and with damages


Whether or not Puno is an agent of the plaintiff and the sale made by the former in favor of other defendants
binds the principal/plaintiff.


No. Puno had no authority to sell the land but only to administer the land. The Document presented did not
give Puno authority to sell the land; that the sale was illegal and void; that defendants should return the land to the
plaintiff; and that defendants should pay plaintiff the sum of P1,000 as damages, P400 of which Puno should be
responsible for, and to pay the costs.

Contracts of agency as well as general powers of attorney must be interpreted in accordance with the
language used by the parties. The real intention of the parties is primarily to be determined from the language
used. The intention is to be gathered from the whole instrument. In case of doubt, resort must be had to the
situation, surroundings and relations of the parties.

Whenever it is possible, effect is to be given to every word and clause used by the parties. It is to be
presumed that the parties said what they intended to say and that they used each word or clause with some
purpose and that purpose, if possible to be ascertained and enforced. The intention of the parties must be sustained
rather than defeated.

If the contract be open to two constructions, one of which would uphold while the other would overthrow
it, the former is to be chosen. So, if by one construction the contract would be illegal, and by another equally
permissible construction it would be lawful, the latter must be adopted. The acts of the parties in carrying out the
contract will presumed to be done in good faith. The acts of the parties will be presumed to have been done in
conformity with and not contrary to the intent of the contract. There is no proof that Puno acted in bad faith or
fraudulently in selling the land. It will be presumed that he acted in good faith and in accordance with his power as
he understood it. That his interpretation of his power is tenable cannot be successfully denied. The defendants
should be relieved from liabilty

The words administer, sell, and purchase etc used in the contract seem to be used coordinately. Each has
equal force with the other. There seems to be no good reason for saying that Puno had authority to administer and
not to sell when to sell was as advantageous to the plaintiff in the administration of his affairs as to administer.
To hold that the power was to administer only when the power to sell was equally conferred would be to give
effect to a portion of the contract only. That would give to special words of the contract a special and limited
meaning to the exclusion of other general words of equal import. In view of all the foregoing, we are of the
opinion that the lower court committed the error complained of in the second assignment, and, without
discussing the other assignments of error, we are of the opinion, and so hold, that the judgment of the lower
court should be and is hereby revoked and that the appellants should be relieved from all liability under the
complaint. Without any finding as to costs, it is so ordered.


Danon vs Brimo and Co

42 Phil. 133

This action was brought to recover the sum of P60,000, alleged to be the value of services rendered to the
defendant by the plaintiff as a broker. The plaintiff alleges that in the month of August, 1918, the defendant
company, through its manager, Antonio A. Brimo, employed him to look for a purchaser of its factory known as
"Holland American Oil Co.," for the sum of P1,200,000, payable in cash; that the defendant promised to pay the
plaintiff, as compensation for his services, a commission of five per cent on the said sum of P1,200,000, if the sale
was consummated, or if the plaintiff should find a purchaser ready, able and willing to buy said factory for the said
sum of P1,200,000; that subsequently the plaintiff found such a purchaser, but that the defendant refused to sell
the said factory without any justifiable motive or reason therefor and without having previously notified the
plaintiff of its desistance or variation in the price and terms of the sale.
Immediately after having an interview with Mr. Brimo, Danon went to see Mr. Mauro Prieto, president of
the Santa Ana Oil Mill, a corporation,and offered to sell to him the defendant's property at P1,200,000. The said
corporation was at that time in need of such a factory, and Mr. Prieto,instructed the manager, Samuel E. Kane, to
see Mr. Brimo and ascertain whether he really wanted to sell said factory, and, if so, to get permissionfrom him to
inspect the premises. Mr. Kane inspected the factory and, presumably, made a favorable report to Mr. Prieto. The
latter asked for anappointment with Mr. Brimo to perfect the negotiation. In the meantime Sellner, the other
broker referred to, had found a purchaser for the sameproperty, who ultimately bought it for.P1,300,000.For that
reason Mr. Prieto, the would be purchaser found by the plaintiff, never came to seeMr. Brimo to perfect the
proposed negotiation.


Whether or not Danon as broker was theProcuring Causeof Sale.


NO. The most that can be said as to what the plaintiff had accomplished is, that he had found a person
who might have bought the defendant's factory. The evidence does not show that the Santa Ana Oil Mill had
definitely decided to buy the property at the fixed price of P1,200,000. The plaintiff claims that the reason why the
sale was not consummated was because Mr. Brimo refused to sell.

It is clear that his "services" did not contribute towards bringing about the sale. He was not "the efficient agent or
the procuring cause of the sale."The broker must be the efficient agent or the procuring cause of sale.. The means
employed by him and his efforts must result in the sale. The failure therefore and its consequences were the risk of
the broker only. This however must be taken with one important and necessary limitation. If the efforts of the
broker are rendered a failure by the fault of the employer; if capriciously he changes his mind after the purchaser,
ready and willing, and consenting to the prescribed terms, is produced; or if the latter declines to complete the
contract because of some defectof title in the ownership of the seller, some unresolved encumbrance, some defect
which is the fault of the latter, then the broker does not lose his commissions. But this limitation is not even an
exception to the general rule affecting the broker's right for it goes on the ground that the broker has done his duty,
that he has brought buyer and seller to an agreement, but that the contract is not consummated and fails though
theafter-fault of the seller.

Although the present plaintiff could probably have effected the sale,he is not entitled to the commissions agreed
upon because he had nointervention whatever in, and much sale in question. It must be borne in mind that no
definite period was fixed by the defendant within which theplaintiff might effect the sale of its factory. Nor was the
plaintiff given by the defendant the exclusive agency of such sale.

Therefore, the plaintiff cannot complaint of the defendant's conduct in selling the property through another agent
before the plaintiff's efforts were crowned with success."One who has employed a broker can himself sell the
property to a purchaser whom he has procured, without any aid from the broker."

For the foregoing reasons the judgment appealed from is hereby revoked and the defendant is hereby absolved
from all liability underthe plaintiff's complaint, with costs in both instances against the plaintiff. So ordered.

Infante vs Cunanan
93 Phil. 693


Consejo Infante, defendant herein, was the owner of two parcels of land, together with a house built
thereon, situated in the City of Manila and covered by Transfer Certificate of Title No. 61786. On or before
November 30, 1948, she contracted the services of Jose Cunanan and Juan Mijares, plaintiff herein, to sell the
above-mentioned property for a price of P30,000 subject to the condition that the purchaser would assume the
mortgage existing thereon in the favor of the Rehabilitation Finance Corporation.

She agreed to pay them a commission of 5 per cent on the purchase price plus whatever overprice they
may obtain for the property. Plaintiffs found one Pio S. Noche who was willing to buy the property under the terms
agreed upon with defendant, but when they introduced him to defendant, the latter informed them that she was no
longer interested in selling the property and succeeded in making them sign a document stating therein that the
written authority she had given them was already can-celled. However, on December 20, 1948, defendant dealt
directly with Pio S. Noche selling to him the property for P31,000. Upon learning this transaction, plaintiffs
demanded from defendant the payment of their commission, but she refused and so they brought the present
action. Defendants herein demanded for their commission. RTC ordered Infante to pay commission. CA affirmed.

Whether or not petitioner was duty bound to pay commission notwithstanding that authority to sell has
been cancelled.

A principal may withdraw the authority given to an agent at will. But respondents agreed to cancel the
authority given to them upon assurance by petitioner that should property be sold to Noche, they would be given

That petitioner had changed her mind even if respondents had found a buyer who was willing to close the
deal, is a matter that would not give rise to a legal consequence if respondents agree to call off the transaction in
deference to the request of the petitioner. But the situation varies if one of the parties takes advantage of the
benevolence of the other and acts in a manner that would promote his own selfish interest. This act is unfair as
would amount to bad faith. This act cannot be sanctioned without ac-cording to the party prejudiced the reward
which is due him. This is the situation in which respondents were placed by petitioner. Petitioner took advantage of
the services rendered by respondents, but believing that she could evade payment of their commission, she made
use of a ruse by inducing them to sign the deed of cancellation Exhibit 1. This act of subversion cannot be
sanctioned and cannot serve as basis for petitioner to escape payment of the commission agreed upon.Wherefore,
the decision appealed from is hereby affirmed, with costs against petitioner.

Manotok Brothers, In. vs Court of Appeals
221 SCRA 224


Petitioner herein (then defendant-appellant) is the owner of a certain parcel of land and building which were
formerly leased by the City of Manila and used by the Claro M. Recto High School, at M.F. Jhocson Street,
Sampaloc Manila.

By means of a letter 5 dated July 5, 1966, petitioner authorized herein private respondent Salvador Saligumba to
negotiate with the City of Manila the sale of the aforementioned property for not less than P425,000.00. In the
same writing, petitioner agreed to pay private respondent a five percent (5%) commission in the event the sale is
finally consummated and paid.

Petitioner, on March 4, 1967, executed another letter 6 extending the authority of private respondent for 120
days. Thereafter, another extension was granted to him for 120 more days, as evidenced by another letter 7 dated
June 26, 1967.

Finally, through another letter 8 dated November 16, 1967, the corporation with Rufino Manotok, its President, as
signatory, authorized private respondent to finalize and consummate the sale of the property to the City of Manila
for not less than P410,000.00. With this letter came another extension of 180 days.

The Municipal Board of the City of Manila eventually, on April 26, 1968, passed Ordinance No. 6603, appropriating
the sum of P410,816.00 for the purchase of the property which private respondent was authorized to sell. Said
ordinance however, was signed by the City Mayor only on May 17, 1968, one hundred eighty three (183) days after
the last letter of authorization.

On January 14, 1969, the parties signed the deed of sale of the subject property. The initial payment of
P200,000.00 having been made, the purchase price was fully satisfied with a second payment on April 8, 1969 by a
check in the amount of P210,816.00.

Notwithstanding the realization of the sale, private respondent never received any commission, which should have
amounted to P20,554.50. This was due to the refusal of petitioner to pay private respondent said amount as the
former does not recognize the latter's role as agent in the transaction.


Whether or not private respondent Salvador Saligumba was an agent of Manotoc entitling him to the commission.


Yes. We agree with respondent Court that the City of Manila ultimately became the purchaser of petitioner's
property mainly through the efforts of private respondent. Without discounting the fact that when Municipal
Ordinance No. 6603 was signed by the City Mayor on May 17, 1968, private respondent's authority had already
expired, it is to be noted that the ordinance was approved on April 26, 1968 when private respondent's
authorization was still in force. Moreover, the approval by the City Mayor came only three days after the expiration
of private respondent's authority. It is also worth emphasizing that from the records, the only party given a written
authority by petitioner to negotiate the sale from July 5, 1966 to May 14, 1968 was private respondent.

The denial of private respondent's claim, does not apply squarely to the instant petition. Claimant-agent in said
case fully comprehended the possibility that he may not realize the agent's commission as he was informed that
another agent was also negotiating the sale and thus, compensation will pertain to the one who finds a purchaser
and eventually effects the sale. Such is not the case herein. On the contrary, private respondent pursued with his
goal of seeing that the parties reach an agreement, on the belief that he alone was transacting the business with
the City Government as this was what petitioner made it to appear.

While it may be true that Filomeno Huelgas followed up the matter with Councilor Magsalin, the author of
Municipal Ordinance No. 6603 and Mayor Villegas, his intervention regarding the purchase came only after the
ordinance had already been passed when the buyer has already agreed to the purchase and to the price for
which said property is to be paid. Without the efforts of private respondent then, Mayor Villegas would have
nothing to approve in the first place. It was actually private respondent's labor that had set in motion the
intervention of the third party that produced the sale, hence he should be amply compensated.

WHEREFORE, in the light of the foregoing and finding no reversible error committed by respondent Court, the
decision of the Court of Appeals is hereby AFFIRMED. The temporary restraining order issued by this Court in its
Resolution dated October 1, 1990 is hereby lifted.


Domingo vs Domingo
42 SCRA 131


Vicente Domingo granted to Gregorio Domingo, a real estate broker, the exclusive agency to sell his Lot
No. 883,Piedad Estate in a document. Said lot has an area of 88,477 sq. m. According to the document, said lot
must be sold for P2 per sq. m. Gregorio is entitled to 5% commission on the total price. Subsequently, Gregorio
authorized Teofilo Purisima to look for a buyer without notifying Vicente. Gregorio promised Teofilo of the 5%
commission. Teofilo introduced Oscar de Leon to Gregorio as a prospective buyer.

Oscar gave Gregorio P1,000 as a gift or propina for succeeding in persuading Vicente to sell his lot at P1.20
per sq. m. .Gregorio did not disclose said gift or propina to Vicente. The deed of sale was not executed since Oscar
gave up on the negotiation when he did not receive his money from his brother in the US, which he communicated
to Gregorio.

Gregorio did not see Oscar for several weeks thus sensing that something fishy might be going on. So, he
went to Vicentes house where he read a portion of the agreement to the effect that Vicente was still willing to
payhim 5% commission, P5 450. Thereafter, Gregorio went to the Register of Deeds of QC, where he discovered
that a Deed of sale was executed by Amparo de Leon, Oscars wife, over their house and lot in favor of Vicente.
After discovering that Vicente sold his lot to Oscars wife, Gregorio demanded in writing the payment of his
Gregorio also conferred with Oscar. Oscar told him that Vicente went to him and asked him to eliminate
Gregorio in the transaction and that he would sell his property to him for P104,000.
The Court of Appeals said that the exclusive agency contract is genuine. The sale of the lot to Amparo de
Leon is practically a sale to Oscar.


Whether or not Gregorios act of accepting the gift or propina from Oscar constitutes a fraud which would cause
the forfeiture of his 5% commission.


Yes. Gregorio Domingo as the broker, received a gift or propina from the prospective buyer Oscar de
Leon, without the knowledge and consent of his principal, Vicente Domingo. His acceptance of said substantial
monetary gift corrupted his duty to serve the interests only of his principal and undermined his loyalty to his
principal, who gave him partial advance of P3000 on his commission. As a consequence, instead of exerting his
best to persuade his prospective buyer to purchase the property on the most advantageous terms desired by his
principal, Gregorio Domingo, succeeded in persuading his principal to accept the counter-offer of the
prospective buyer to purchase the property at P1.20 per sq. m.

The duties and liabilities of a broker to his employer are essentially those which an agent owes to his

An agent who takes a secret profit in the nature of a bonus, gratuity or personal benefit from the vendee,
without revealing the same to his principal, the vendor, is guilty of a breach of his loyalty to the principal and
forfeits his right to collect the commission from his principal, even if the principal does not suffer any injury by
reason of such breach of fidelity, or that he obtained better results or that the agency is a gratuitous one, or
that usage or custom allows it.

The fact that the principal may have been benefited by the valuable services of the said agent does not
exculpate the agent who has only himself to blame for such a result by reason of his treachery or perfidy. As a
necessary consequence of such breach of trust, Gregorio Domingo must forfeit his right to the commission and
must return the part of the commission he received from his principal.

WHEREFORE, the judgment is hereby rendered, reversing the decision of the Court of Appeals and
directing defendant-appellee Gregorio Domingo: (1) to pay to the heirs of Vicente Domingo the sum of One
Thousand Pesos (P1,000.00) as moral damages and One Thousand Pesos (P1,000.00) as attorney's fees; (2) to
pay Teofilo Purisima the sum of Six Hundred Fifty Pesos (P650.00); and (3) to pay the costs.

Siasat vs Intermediate Appellate Court

139 SCRA 238