SHINETH DIVINE D.

ALEJANDRE BUSINESS ORGNIZATION CASE DIGESTS ON AGENCY

SANCHEZ V MEDICARD PHILIPPINES, INC.

GR NO. 141525 September 2, 2005

FACTS:
Sanchez is an agent of Medicard with commission based on compensation. Medicard entered into
conract with UNILAB through the Sanchez which as a result Medicard paid him his commission.
Medicard proposed an increase in premium but UNILAB rejected. So Medicard requested Sanchez
to reduce his commission should the contract be renewed which the latter denied. So the company
decide to directly negotiate with UNILAB to facilitate the renewal of contract and revoking its
agency with Sanchez.

ISSUE:
Whether or not Sanchez is entitled for a commission due to the renewal of contract.

HELD:
No. In order for an agent to be entitled to commission, he must be the procuring cause of the sale,
which means that the measures employed by him and the efforts he exerted must result in a sale.
In other words, an agent receives his commission only upon successful conclusion of a sale,
conversely, it follows that where his efforts are unsuccessful, or there was no effort on his part, he
is not entitled to a commission.

FILIPINAS LIFE ASSURANCE CO. V CLEMENTE PEDROSA, TERISITA PEDROSA AND

JENNIFER PALACIO
GR. NO. 159489, February 04, 2008

FACTS:
Teresita Pedroso is a policyholder of a 20-year endowment life insurance issued by Filipinas
Life Assurance Co. Pedroso claims Renato Valle was her insurance agent since 1972 and
Valle collected her monthly premiums. Valle told her that the Filipinas Life Escolta Office
was holding a promotional investment program for policyholders. Enticed, she initially
made several investments and told respondent Jennifer Palacio, also a Filipinas Life
insurance policyholder, about the investment plan. When Pedroso tried to withdraw her
investment, Valle did not want to return some P17,000 worth of it. Palacio also tried to
withdraw hers, but Filipinas Life, despite demands, refused to return her money.

ISSUE:
SHINETH DIVINE D. ALEJANDRE BUSINESS ORGNIZATION CASE DIGESTS ON AGENCY

WON its agent Renato Valle is solely liable to Pedroso and Palacio.

HELD:
Yes. By the contract of agency, a person binds himself to render some service or to do
something in representation or on behalf of another, with the consent or authority of the
latter. The general rule is that the principal is responsible for the acts of its agent done
within the scope of its authority, and should bear the damage caused to third persons.
When the agent exceeds his authority, the agent becomes personally liable for the damage.
But even when the agent exceeds his authority, the principal is still solidarily liable together
with the agent if the principal allowed the agent to act as though the agent had full powers.
The acts of an agent beyond the scope of his authority do not bind the principal, unless
the principal ratifies them, expressly or impliedly. Even if Valle’s representations were
beyond his authority as a debit/insurance agent, Filipinas Life thru Alcantara and Apetrior
expressly and knowingly ratified Valle’s acts. Filipinas Life benefited from the investments
deposited by Valle in the account of Filipinas Life.