BALTAZAR v. OMBUDSMAN

BALTAZAR v. OMBUDSMAN

G.R. No. 136433; December 6, 2006

Ponente: Velasco Jr.

FACTS:

Paciencia Regala owns a seven (7)-hectare fishpond located at Sasmuan, Pampanga. Her Attorney-in-Fact Faustino R. Mercado leased the fishpond for PhP 230,000.00 to Eduardo Lapid for a three (3)-year period.  Lessee Eduardo Lapid in turn sub-leased the fishpond to Rafael Lopez for PhP 50,000.00 during the last seven (7) months of the original lease. Respondent Ernesto Salenga was hired by Eduardo Lapid as fishpond watchman (bante-encargado). In the sub-lease, Rafael Lopez rehired respondent Salenga.

Meanwhile, on March 11, 1993, respondent Salenga, through a certain Francis Lagman, sent his January 28, 1993 demand letter to Rafael Lopez and Lourdes Lapid for unpaid salaries and non-payment of the 10% share in the harvest.

On June 5, 1993, sub-lessee Rafael Lopez wrote a letter to respondent Salenga informing the latter that for the last two (2) months of the sub-lease, he had given the rights over the fishpond to Mario Palad and Ambit Perez for PhP 20,000.00.  This prompted respondent Salenga to file a Complaint before the Provincial Agrarian Reform Adjudication Board (PARAB).

On November 24, 1994, pending resolution of the agrarian case, the instant case was instituted by petitioner Antonio Baltazar, an alleged nephew of Faustino Mercado, through a Complaint-Affidavit against private respondents before the Office of the Ombudsman.

Petitioner charged private respondents of conspiracy through the issuance of the TRO in allowing respondent Salenga to retain possession of the fishpond, operate it, harvest the produce, and keep the sales under the safekeeping of other private respondents

Petitioner asserts that he is duly authorized by Faustino Mercado to institute the suit and presented a Special Power of Attorney (SPA) from Faustino Mercado.

ISSUE:

Whether Faustino Mercado can delegate his agency to his nephew Antonio Baltazar

HELD:

No, Faustino Mercado cannot delegate his agency to his nephew Antonio Baltazar.

The Supreme Court held that petitioner's principal, Faustino Mercado, is an agent himself and as such cannot further delegate his agency to another. Otherwise put, an agent cannot delegate to another the same agency. The legal maxim potestas delegata non delegare potest; a power once delegated cannot be re-delegated, while applied primarily in political law to the exercise of legislative power, is a principle of agency.  For another, a re-delegation of the agency would be detrimental to the principal as the second agent has no privity of contract with the former. 

In the instant case, petitioner has no privity of contract with Paciencia Regala, owner of the fishpond and principal of Faustino Mercado.

LIM TANHU v. HON. JOSE R. RAMOLETE

LIM TANHU v. HON. JOSE R. RAMOLETE

G.R. No. L-40098; August 29, 1975

Ponente: J. Barredo

FACTS:

Tan alleged that she is the widow of Tee Hoon Lim Po Chuan, who was a partner in the commercial partnership, Glory Commercial Company with Antonio Lim Tanhu and Alfonso Ng Sua". 

Defendant Antonio Lim Tanhu, Alfonso Leonardo Ng Sua, Lim Teck Chuan, and Eng Chong Leonardo, through fraud and machination, took actual and active management of the partnership and although Tee Hoon Lim Po Chuan was the manager of Glory Commercial Company, defendants managed to use the funds of the partnership to purchase lands and buildings in the cities of Cebu, Lapulapu, Mandaue, and the municipalities of Talisay and Minglanilla.

She alleged in her complaint that after the death of Tee Hoon Lim Po Chuan, the defendants, without liquidation, continued the business of Glory Commercial Company, by purportedly organizing a corporation known as the Glory Commercial Company, Incorporated and sometime in the month of November, 1967, defendants, particularly Antonio Lim Tanhu, by means of fraud deceit, and misrepresentations did then and there, induce and convince her to execute a quitclaim of all her rights and interests, in the assets of the partnership of Glory Commercial Company.

Thereafter, in the year 1968-69, the defendants who had earlier promised to liquidate the aforesaid properties and assets in favor, among others of plaintiff and until the middle of the year 1970 when the plaintiff formally demanded from the defendants the accounting of real and personal properties of the Glory Commercial Company, defendants refused and stated that they would not give the share of the plaintiff.

ISSUE:

Whether Tan has a right over the liquidated properties of the partnership

HELD:

No, Tan has no right over the liquidated properties of the partnership

The Supreme Court held that there is no alternative but to hold that plaintiff Tan Put's allegation that she is the widow of Tee Hoon Lim Po Chuan has not been satisfactorily established and that, on the contrary, the evidence on record convincingly shows that her relation with said deceased was that of a common-law wife.

Moreover, the Supreme Court said that the lower courts committed an error by awarding 1/3 of the partnership properties to Tan because there has been no liquidation proceedings yet. And if there has not yet been any liquidation of the partnership, the only right plaintiff could have would be to what might result after much liquidation to belong to the deceased partner (her alleged husband) and before this is finished, it is impossible to determine, what rights or interest, if any the deceased had. 

In other words, no specific amounts or properties may be adjudicated to the heir or legal representative of the deceased partner without the liquidation being first terminated.

YU v. NLRC

YU v. NLRC

G.R. No. 97212; June 30, 1993

Ponente: J. Feliciano

FACTS:

Petitioner Benjamin Yu was formerly the Assistant General Manager of the marble quarrying and export business operated by a registered partnership with the firm name of "Jade Mountain Products Company Limited" ("Jade Mountain"). The partnership was originally organized on 28 June 1984 with Lea Bendal and Rhodora Bendal as general partners and Chiu Shian Jeng, Chen Ho-Fu and Yu Chang, all citizens of the Republic of China (Taiwan), as limited partners.

Sometime in 1988, without the knowledge of Benjamin Yu, the general partners Lea Bendal and Rhodora Bendal sold and transferred their interests in the partnership to private respondent Willy Co and to one Emmanuel Zapanta. Mr. Yu Chang, a limited partner, also sold and transferred his interest in the partnership to Willy Co. Between Mr. Emmanuel Zapanta and himself, private respondent Willy Co acquired the great bulk of the partnership interest. The partnership now constituted solely by Willy Co and Emmanuel Zapanta continued to use the old firm name of Jade Mountain, though they moved the firm's main office from Makati to Mandaluyong, Metropolitan Manila
Petitioner was informed by Willy Co that the latter had bought the business from the original partners and that it was for him to decide whether or not he was responsible for the obligations of the old partnership, including petitioner's unpaid salaries. Petitioner was in fact not allowed to work anymore in the Jade Mountain business enterprise. His unpaid salaries remained unpaid.
On 21 December 1988, Benjamin Yu filed a complaint for illegal dismissal and recovery of unpaid salaries accruing from November 1984 to October 1988

ISSUE:
Whether the partnership which had hired petitioner Yu as Assistant General Manager had been extinguished and replaced by a new partnership composed of Willy Co and Emmanuel Zapanta


HELD:

Yes, the partnership which hired Yu was extinguished and replaced by a new partnership.

In the case at bar, just about all of the partners had sold their partnership interests (amounting to 82% of the total partnership interest) to Mr. Willy Co and Emmanuel Zapanta. The record does not show what happened to the remaining 18% of the original partnership interest. The acquisition of 82% of the partnership interest by new partners, coupled with the retirement or withdrawal of the partners who had originally owned such 82% interest, was enough to constitute a new partnership

In the ordinary course of events, the legal personality of the expiring partnership persists for the limited purpose of winding up and closing of the affairs of the partnership.

In other words, the new partnership simply took over the business enterprise owned by the preceding partnership, and continued using the old name of Jade Mountain Products Company Limited, without winding up the business affairs of the old partnership, paying off its debts, liquidating and distributing its net assets, and then re-assembling the said assets or most of them and opening a new business enterprise.

The new partnership itself which continued the business of the old, dissolved, one, are liable for the debts of the preceding partnership.

DELUAO v. CASTEEL

DELUAO v. CASTEEL

G.R. No. L-21906; December 24, 1968

Ponente: J. Castro

FACTS:

In 1940 Nicanor Casteel unsuccessfully registered a fishpond in a big tract of swampy land, 178.76 hectares, in the then sitio of Malalag, municipality of Padada, Davao for 3 consecutive times because the Bureau of Fisheries did not act upon his previous applications.
  Despite the said rejection, Casteel did not lose interest. Because of the threat poised upon his position by the other applicants who entered upon and spread themselves within the area, Casteel realized the urgent necessity of expanding his occupation thereof by constructing dikes and cultivating marketable fishes. But lacking financial resources at that time, he sought financial aid from his uncle Felipe Deluao.
Moreover, upon learning that portions of the area applied for by him were already occupied by rival applicants, Casteel immediately filed a protest. Consequently, two administrative cases ensued involving the area in question.

However, despite the finding made in the investigation of the above administrative cases, the Director of Fisheries nevertheless rejected Casteel's application on October 25, 1949, required him to remove all the improvements which he had introduced on the land, and ordered that the land be leased through public auction

On November 25, 1949 Inocencia Deluao (wife of Felipe Deluao) as party of the first part, and Nicanor Casteel as party of the second part, executed a contract — denominated a "contract of service". On the same date the above contract was entered into, Inocencia Deluao executed a special power of attorney in favor of Jesus Donesa

On November 29, 1949 the Director of Fisheries rejected the application filed by Felipe Deluao on November 17, 1948. Unfazed by this rejection, Deluao reiterated his claim over the same area in the two administrative cases and asked for reinvestigation of the application of Nicanor Casteel over the subject fishpond.

The Secretary of Agriculture and Natural Resources rendered a decision ordering Casteel to be reinstated in the area and that he shall pay for the improvement made thereupon.
Sometime in January 1951 Nicanor Casteel forbade Inocencia Deluao from further administering the fishpond, and ejected the latter's representative (encargado), Jesus Donesa, from the premises.

ISSUE:
Whether the reinstatement of Casteel over the subject land constitute a dissolution of the partnership between him and Deluao

HELD:

Yes, the reinstatement of Casteel dissolved his partnership with Deluao.

The Supreme Court ruled that the arrangement under the so-called "contract of service" continued until the decision both dated Sept. 15, 1950 were issued by the Secretary of Agriculture and Natural Resources in DANR Cases 353 and 353-B. 

This development, by itself, brought about the dissolution of the partnership. Since the partnership had for its object the division into two equal parts of the fishpond between the appellees and the appellant after it shall have been awarded to the latter, and therefore it envisaged the unauthorized transfer of one half thereof to parties other than the applicant Casteel, it was dissolved by the approval of his application and the award to him of the fishpond.

The approval was an event which made it unlawful for the members to carry it on in partnership. Moreover, subsequent events likewise reveal the intent of both parties to terminate the partnership because each refused to share the fishpond with the other.

EUROTECH INDUSTRIAL TECHNOLOGIES, INC. v. CUIZON

EUROTECH INDUSTRIAL TECHNOLOGIES, INC. v.  CUIZON

G.R. No. 167552; April 23, 2007

Ponente: J. Chico-Nazario

FACTS:

From January to April 1995, petitioner sold to Impact Systems various products allegedly amounting to P91,338.00 pesos. Subsequently, respondents sought to buy from petitioner one unit of sludge pump valued at P250,000.00 with respondents making a down payment of P50,000.00.  When the sludge pump arrived from the United Kingdom, petitioner refused to deliver the same to respondents without their having fully settled their indebtedness to petitioner. Thus, on 28 June 1995, respondent EDWIN and Alberto de Jesus, general manager of petitioner, executed a Deed of Assignment of receivables in favor of petitioner. Impact systems is owed by ERWIN Cuizon.

Despite the existence of the Deed of Assignment, respondents proceeded to collect from Toledo Power Company the amount of P365,135.29.  Alarmed by this development, petitioner made several demands upon respondents to pay their obligations. As a result, respondents were able to make partial payments to petitioner. On 7 October 1996, petitioner's counsel sent respondents a final demand letter wherein it was stated that as of 11 June 1996, respondents' total obligations stood at P295,000.00 excluding interests and attorney's fees.  Because of respondents' failure to abide by said final demand letter, petitioner instituted a complaint for sum of money, damages, with application for preliminary attachment against herein respondents

By way of special and affirmative defenses, respondent EDWIN alleged that he is not a real party in interest in this case. According to him, he was acting as mere agent of his principal, which was the Impact Systems, in his transaction with petitioner and the latter was very much aware of this fact.

ISSUE:

Whether the act of Edwin in signing the Deed of Assignment binds his principal Impact Systems

HELD:

Yes, the act of Edwin in signing the Deed of Assignment binds Impact Systems

The Supreme Court held that in a contract of agency, a person binds himself to render some service or to do something in representation or on behalf of another with the latter's consent. Its purpose is to extend the personality of the principal or the party for whom another acts and from whom he or she derives the authority to act. It is said that the basis of agency is representation, that is, the agent acts for and on behalf of the principal on matters within the scope of his authority and said acts have the same legal effect as if they were personally executed by the principal.

In this case at hand, the parties do not dispute the existence of the agency relationship between respondents ERWIN as principal and EDWIN as agent.

ONG v. CA

ONG v. CA

G.R. No. 119858; April 29, 2003

Ponente: J. Carpio

FACTS:

That on or about July 23, 1990, Benito Ong, representing ARMAGRI International Corporation, conspiring and confederating together did then and there willfully, unlawfully and feloniously defraud the SOLIDBANK Corporation represented by its Accountant, DEMETRIO LAZARO, in the following manner, to wit: the said accused received in trust from said SOLIDBANK Corporation, 10,000 bags of urea valued at P, 2,050,000 specified in a Trust Receipt Agreement and covered by a Letter of Credit No. DOM GD 90-009 in favor of the Fertiphil Corporation.

Under the express obligation on the part of the said accused to account for said goods to Solidbank Corporation and/or remit the proceeds of the sale thereof within the period specified in the Agreement or return the goods, if unsold immediately or upon demand. 

However, Ong, once in possession of said goods, far from complying with the aforesaid obligation failed and refused and still fails and refuses to do so despite repeated demands made upon him to that effect and with intent to defraud, willfully, unlawfully and feloniously misapplied, misappropriated and converted the same or the value thereof to his own personal use and benefit, to the damage and prejudice of the said Solidbank Corporation in the aforesaid amount of P2,050,000.00 Philippine Currency.
Petitioner contends that in signing the trust receipts, he merely acted as an agent of ARMAGRI. Petitioner asserts that nowhere in the trust receipts did he assume personal responsibility for the undertakings of ARMAGRI which was the entrustee.

ISSUE:
Whether ARMAGRI Corp. violated the Trust Receipts Law

HELD:
No, ARMGAGRI Corp. did not violate the Trust Receipts Law

The Supreme Court held that the Trust Receipts Law recognizes the impossibility of imposing the penalty of imprisonment on a corporation. Hence, if the entrustee is a corporation, the law makes the officers or employees or other persons responsible for the offense liable to suffer the penalty of imprisonment. The reason is obvious: corporations, partnerships, associations and other juridical entities cannot be put to jail. Hence, the criminal liability falls on the human agent responsible for the violation of the Trust Receipts Law.
In the instant case, the Bank was the entruster while ARMAGRI was the entrustee. Being the entrustee, ARMAGRI was the one responsible to account for the goods or its proceeds in case of sale. However, the criminal liability for violation of the Trust Receipts Law falls on the human agent responsible for the violation. 

Petitioner, who admits being the agent of ARMAGRI, is the person responsible for the offense for two reasons. First, petitioner is the signatory to the trust receipts, the loan applications and the letters of credit. Second, despite being the signatory to the trust receipts and the other documents, petitioner did not explain or show why he is not responsible for the failure to turn over the proceeds of the sale or account for the goods covered by the trust receipts. 

SEVILLA v. CA

SEVILLA v. CA

G.R. Nos. L-41182-3; April 15, 1988

Ponente: J. Sarmiento

FACTS:

On Oct. 19, 1960, the Tourist World Service, Inc. leased an office at Mabini St., Manila for the former's use as a branch office. When the branch office was opened, the same was run by the herein appellant Lina O. Sevilla payable to Tourist World Service Inc. by any airline for any fare brought in on the efforts of Mrs. Lina Sevilla, 4% was to go to Lina Sevilla and 3% was to be withheld by the Tourist World Service, Inc. 

On or about November 24, 1961, the Tourist World Service, Inc. appears to have been informed that Lina Sevilla was connected with a rival firm, the Philippine Travel Bureau, and, since the branch office was anyhow losing, the Tourist World Service considered closing down its office. 

This was firmed up by two resolutions of the board of directors of Tourist World Service, Inc. dated Dec. 2, 1961, the first abolishing the office of the manager and vice-president of the Tourist World Service, Inc., Ermita Branch, and the second, authorizing the corporate secretary to receive the properties of the Tourist World Service then located at the said branch office. It further appears that on Jan. 3, 1962, the contract with the appellees for the use of the Branch Office premises was terminated and while the effectivity thereof was Jan. 31, 1962, the appellees no longer used it. As a matter of fact appellants used it since Nov. 1961. Because of this, and to comply with the mandate of the Tourist World Service, the corporate secretary Gabino Canilao went over to the branch office, and, finding the premises locked, and, being unable to contact Lina Sevilla, he padlocked the premises on June 4, 1962 to protect the interests of the Tourist World Service. 

When neither the appellant Lina Sevilla nor any of her employees could enter the locked premises, a complaint was filed by the herein appellants against the appellees with a prayer for the issuance of mandatory preliminary injunction. Both appellees answered with counterclaims. For apparent lack of interest of the parties therein, the trial court ordered the dismissal of the case without prejudice.

ISSUE:
Whether the act of Tourist World Service in abolishing its Ermita branch proper


HELD:

No, the act of Tourist World Service in abolishing its Ermita branch is not proper.

The Supreme Court held that when the petitioner, Lina Sevilla, agreed to manage Tourist World Service, Inc.'s Ermita office, she must have done so pursuant to a contract of agency.

In the case at bar, Sevilla solicited airline fares, but she did so for and on behalf of her principal, Tourist World Service, Inc. As compensation, she received 4% of the proceeds in the concept of commissions. And as we said, Sevilla herself, based on her letter of November 28, 1961, presumed her principal's authority as owner of the business undertaking. We are convinced, considering the circumstances and from the respondent Court's recital of facts, that the parties had contemplated a principal-agent relationship, rather than a joint management or a partnership.

But unlike simple grants of a power of attorney, the agency that we hereby declare to be compatible with the intent of the parties, cannot be revoked at will. The reason is that it is one coupled with an interest, the agency having been created for the mutual interest of the agent and the principal. Accordingly, the revocation complained of should entitle the petitioner, Lina Sevilla, to damages

UYTENGSU III v. ATTY. BADUEL

UYTENGSU III v. ATTY. BADUEL

A.C. No. 5134; December 14, 2005

Ponente: J. Tinga

FACTS:

Complainant is one of the heirs of Tirso Uytengsu, Jr. He and his co-heirs had a pending patent application. He alleges that sometime in December 1998 respondent requested him to sign a special power of attorney (SPA) authorizing Luis Wee (Wee) and/or Thomas Jacobo (Jacobo) to claim, demand, acknowledge and receive on his behalf the certificates of title from the Register of Deeds, General Santos City, Department of Environment and Natural Resources and from any government office or agency due to complainant and his co-heirs by reason of their application for Homestead Patent.

Complainant refused to sign the SPA as he wanted to obtain the documents personally. 
In essence, complainant asserts that respondent caused Kokseng to execute an SPA in favor of Wee and/or Jacobo to the damage and prejudice of the heirs of Tirso Uytengsu, Jr. even if he knew that Kokseng had no authority to do so.

ISSUE:
Whether Atty. Baduel exceeded his authority as counsel when he asked Uytengsu to sign an SPA

HELD:

No, Atty. Baduel did not exceed his authority as counsel.

The Supreme Court held that the relation of attorney and client is in many respects one of agency and the general rules of ordinary agency apply to such relation.  The extent of authority of a lawyer, when acting on behalf of his client outside of court, is measured by the same test as that which is applied to an ordinary agent.  

Such being the case, even respondent himself can acquire the certificates of title and other documents without need of an SPA from complainant and his co-heirs.

HAHN v. CA

HAHN v. CA

G.R. No. 113074; January 22, 1997

Ponente: J. Mendoza

FACTS:
Petitioner Alfred Hahn is a Filipino citizen doing business under the name and style "Hahn-Manila". On the other hand, private respondent (BMW) is a nonresident foreign corporation existing under the laws of the former Federal Republic of Germany, with principal office at Munich, Germany.

On March 7, 1967, petitioner executed in favor of private respondent a "Deed of Assignment with Special Power of Attorney. Per the agreement, the parties "continue[d] business relations as has been usual in the past without a formal contract." 

But on February 16, 1993, in a meeting with a BMW representative and the president of Columbia Motors Corporation (CMC), Jose Alvarez, petitioner was informed that BMW was arranging to grant the exclusive dealership of BMW cars and products to CMC, which had expressed interest in acquiring the same. 

On February 24, 1993, petitioner received confirmation of the information from BMW which, in a letter, expressed dissatisfaction with various aspects of petitioner's business, mentioning among other things, decline in sales, deteriorating services, and inadequate showroom and warehouse facilities, and petitioner's alleged failure to comply with the standards for an exclusive BMW dealer.

Nonetheless, BMW expressed willingness to continue business relations with the petitioner on the basis of a "standard BMW importer" contract, otherwise, it said, if this was not acceptable to petitioner, BMW would have no alternative but to terminate petitioner's exclusive dealership effective June 30, 1993. 

  Because of Hahn's insistence on the former business relations, BMW withdrew on March 26, 1993 its offer of a "standard importer contract" and terminated the exclusive dealer relationship effective June 30, 1993.

On April 29, 1993, BMW proposed that Hahn and CMC jointly import and distribute BMW cars and parts.

Hahn found the proposal unacceptable. On May 14, 1993, he filed a complaint for specific performance and damages against BMW to compel it to continue the exclusive dealership.

ISSUE:
Whether petitioner Alfred Hahn is the agent or distributor in the Philippines of private respondent BMW

HELD:

Alfred Hahn is an agent of BMW.

The Supreme Court held that agency is shown when Hahn claimed he took orders for BMW cars and transmits them to BMW. Then BMW fixes the down payment and pricing charges and will notify Hahn of the scheduled production month for the orders, and reconfirm the orders by signing and returning to Hahn the acceptance sheets. 

The payment is made by the buyer directly to BMW. Title to cars purchased passed directly to the buyer and Hahn never paid for the purchase price of BMW cars sold in the Philippines. Hahn was credited with a commission equal to 14% of the purchase price upon the invoicing of a vehicle order by BMW. Upon confirmation in writing that the vehicles had been registered in the Philippines and serviced by him, Hahn received an additional 3% of the full purchase price. Hahn performed after-sale services, including, warranty services. for which he received reimbursement from BMW. All orders were on invoices and forms of BMW.

Moreover, the Court distinguished an agent from a broker. The court ruled that an agent receives a commission upon the successful conclusion of a sale. On the other hand, a broker earns his pay merely by bringing the buyer and the seller together, even if no sale is eventually made.

LIM v. SABAN

LIM v. SABAN

G.R. No. 163720; December 16, 2004

Ponente: J. Tinga

FACTS:

Under an Agency Agreement, Ybañez authorized Saban to look for a buyer of the lot for Two Hundred Thousand Pesos (P200,000.00) and to mark up the selling price to include the amounts needed for payment of taxes, transfer of title and other expenses incident to the sale, as well as Saban's commission for the sale. 

Through Saban's efforts, Ybañez and his wife were able to sell the lot to the petitioner Genevieve Lim (Lim) and the spouses Benjamin and Lourdes Lim (the Spouses Lim) on March 10, 1994. The price of the lot as indicated in the Deed of Absolute Sale is Two Hundred Thousand Pesos (P200,000.00).  It appears, however, that the vendees agreed to purchase the lot at the price of Six Hundred Thousand Pesos (P600,000.00), inclusive of taxes and other incidental expenses of the sale.

After the sale, Lim remitted to Saban the amounts of P113,257 for payment of taxes due on the transaction as well as P50,000.00 as broker's commission. Lim also issued in the name of Saban four postdated checks in the aggregate amount of P236,743.00.

Subsequently, Ybañez sent a letter dated June 10, 1994 addressed to Lim. In the letter Ybañez asked Lim to cancel all the checks issued by her in Saban's favor and to "extend another partial payment" for the lot in his (Ybañez's) favor. 

After the four checks in his favor were dishonored upon presentment, Saban filed a complaint for collection of sum of money and damages against Ybañez and Lim
Saban alleged that Ybañez told Lim that he (Saban) was not entitled to any commission for the sale since he concealed the actual selling price of the lot from Ybañez and because he was not a licensed real estate broker. Ybañez was able to convince Lim to cancel all four checks.

In his Answer, Ybañez claimed that Saban was not entitled to any commission because he concealed the actual selling price from him and because he was not a licensed real estate broker.


ISSUE:
          Whether Saban is entitled to receive his commission from the sale


HELD:

          Yes, Saban is entitled to receive his commission from the sale.

          The Supreme Court held that to deprive Saban of his commission subsequent to the sale which was consummated through his efforts would be a breach of his contract of agency with Ybañez which expressly states that Saban would be entitled to any excess in the purchase price after deducting the P200,000.00 due to Ybañez and the transfer taxes and other incidental expenses of the sale.
          Moreover, the Court has already decided in earlier cases that would be in the height of injustice to permit the principal to terminate the contract of agency to the prejudice of the broker when he had already reaped the benefits of the broker's efforts.

J-PHIL MARINE, INC. v. NLRC

J-PHIL MARINE, INC. v. NLRC

G.R. No. 175366; August 11, 2008

Ponente: J. Carpio-Morales

FACTS:
Warlito E. Dumalaog (respondent), who served as cook aboard vessels plying overseas, filed on March 4, 2002 before the National Labor Relations Commission (NLRC) a pro-forma complaint against petitioners — manning agency J-Phil Marine, Inc. (J-Phil), its then president Jesus Candava, and its foreign principal Norman Shipping Services — for unpaid money claims, moral and exemplary damages, and attorney's fees.

Respondent's total claim against petitioners was P864,343.30 plus P117,557.60 representing interest and P195,928.66 representing attorney's fees

By Decision of August 29, 2003, Labor Arbiter Fe Superiaso-Cellan dismissed respondent's complaint for lack of merit. 

On appeal, the NLRC, by Decision of September 27, 2004, reversed the Labor Arbiter's decision.

During the pendency of the case before the Supreme Court, respondent, against the advice of his counsel, entered into a compromise agreement with petitioners. He thereupon signed a Quitclaim and Release subscribed and sworn to before the Labor Arbiter.

ISSUE:
Whether the act of Dumalaog in entering into a compromise agreement without the assistance of a counsel is proper

HELD:

Yes, the act of Dumalaog in entering into a compromise agreement without a lawyer is proper.

The Supreme Court held that the relation of attorney and client is in many respects one of agency, and the general rules of agency apply to such relation. The acts of an agent are deemed the acts of the principal only if the agent acts within the scope of his authority. The circumstances of this case indicate that respondent's counsel is acting beyond the scope of his authority in questioning the compromise agreement.

Dumalaog has undoubtedly the right to compromise a suit without the intervention of his lawyer cannot be gainsaid, the only qualification being that if such compromise is entered into with the intent of defrauding the lawyer of the fees justly due him, the compromise must be subject to the said fees. 

In the case at bar, there is no showing that respondent intended to defraud his counsel of his fees.

VELOSO v. CA

VELOSO v. CA

G.R. No. 102737; August 21, 1996

Ponente: J. Torres Jr.

FACTS:

Petitioner Francisco Veloso was the owner of a parcel of land situated in the district of Tondo, Manila, with an area of 177 square meters. The title was registered in the name of Francisco A. Veloso. The said title was subsequently cancelled and a new one issued in the name of Aglaloma B. Escario, married to Gregorio L. Escario, on May 24, 1988.  

On August 24, 1988, petitioner Veloso filed an action for annulment of documents, reconveyance of property with damages and preliminary injunction and/or restraining order. Petitioner alleged therein that he was the absolute owner of the subject property and he never authorized anybody, not even his wife, to sell it. He alleged that he was in possession of the title but when his wife, Irma, left for abroad, he found out that his copy was missing. He then verified with the Registry of Deeds of Manila and there he discovered that his title was already canceled in favor of defendant Aglaloma Escario. 

The transfer of property was supported by a General Power of Attorney dated November 29, 1985 and Deed of Absolute Sale, dated November 2, 1987, executed by Irma Veloso, wife of the petitioner and appearing as his attorney-in-fact, and defendant Aglaloma Escario. 

Petitioner Veloso, however, denied having executed the power of attorney and alleged that his signature was falsified. He also denied having seen or even known Rosemarie Reyes and Imelda Santos, the supposed witnesses in the execution of the power of attorney. He vehemently denied having met or transacted with the defendant. Thus, he contended that the sale of the property, and the subsequent transfer thereof, were null and void. 

Defendant Aglaloma Escario in her answer alleged that she was a buyer in good faith and denied any knowledge of the alleged irregularity. She allegedly relied on the general power of attorney of Irma Veloso which was sufficient in form and substance and was duly notarized. 


ISSUE:
Whether there was a valid sale of the subject property

HELD:

Yes, the sale of the subject property is valid


The Supreme Court held that an examination of the records showed that the assailed power of attorney was valid and regular on its face. It was notarized and as such, it carries the evidentiary weight conferred upon it with respect to its due execution. While it is true that it was denominated as a general power of attorney, a perusal thereof revealed that it stated an authority to sell.


Respondent Aglaloma relied on the power of attorney presented by petitioner's wife, Irma. Being the wife of the owner and having with her the title of the property, there was no reason for the private respondent not to believe, in her authority. Thus, having had no inkling on any irregularity and having no participation thereof, private respondent was a buyer in good faith. It has been consistently held that a purchaser in good faith is one who buys property of another, without notice that some other person has a right to, or interest in such property and pays a full and fair price for the same, at the time of such purchase, or before he has notice of the claim or interest of some other person in the property.

OLAGUER v. ONJUCO

OLAGUER v. ONJUCO

G.R. No. 173312; August 26, 2008

Ponente: J. Chico-Nazario

FACTS:

Lino Olaguer died on October 3, 1957 so Special Proceedings No. 528 for probate of will was filed in the then Court of First Instance of Albay. Defendant Olivia P. Olaguer was appointed as administrator pursuant to the will. Later, defendant Eduardo Olaguer was appointed as co-administrator. 

In the order of the probate court dated April 4, 1961, some properties of the estate were authorized to be sold to pay obligations of the estate. 

Relying upon the order, but without prior notice or permission from the Probate Court, defendants Olivia P. Olaguer and Eduardo Olaguer on November 1, 1965 sold to Estanislao Olaguer 10 parcels of land. The sale to was approved by the Probate Court on November 12, 1965.

On July 7, 1966, defendant Olivia P. Olaguer executed a Special Power of Attorney in favor of defendant Jose A. Olaguer, authorizing the latter to "sell, mortgage, assign, transfer, endorse and deliver" of 6 properties.

On July 7, 1966, Estanislao Olaguer executed a Special Power of Attorney in favor of Jose A. Olaguer authorizing the latter to "sell, mortgage, assign, transfer, endorse and deliver" the 9 properties.

By virtue of this Special Power of Attorney, on March 1, 1967, Jose A. Olaguer as Attorney-in-Fact of Estanislao Olaguer mortgaged Lots 7589, 7593 and 7396 to defendant PNB as security for a loan of 10,000 Pesos. The mortgage was foreclosed by the PNB on June 13, 1973 and the properties mortgage were sold at public auction to PNB. On December 10, 1990, the PNB transferred the properties to the Republic of the Philippines pursuant to Exec. Order No. 407 dated June 14, 1990 for agrarian reform purposes. 

On October 29, 1966, Estanislao Olaguer executed a General Power of Attorney in favor of Jose A. Olaguer, authorizing the latter to exercise general control and supervision over all of his business and properties, and among others, to sell or mortgage any of his properties.

On December 29, 1966, Estanislao Olaguer sold to Jose A. Olaguer for 15,000 the 10 parcels of land he bought from Olivia P. Olaguer and Eduardo Olaguer.

On March 16, 1968, Estanislao Olaguer sold to Jose A. Olaguer for 1 Peso and other valuable consideration 2 parcels of land which have a total area of 2.5 hectares. 

On June 5, 1968, Estanislao Olaguer sold another 2 lots to Jose A. Olaguer for 1 Peso and other valuable consideration. 

On May 13, 1971, Jose A. Olaguer in his capacity as Attorney in-Fact of Estanislao Olaguer sold to his son Virgilio Olaguer for 1 Peso and other valuable consideration.

On July 15, 1974, Jose A. Olaguer sold to his son Virgilio Olaguer Lot No. 4521 and Lot No. 4522 for 1,000 Pesos. 

On September 16, 1978 Virgilio Olaguer executed a General Power of Attorney in favor of Jose A. Olaguer authorizing the latter to exercise general control and supervision over all of his business and properties and among others, to sell or mortgage the same.

Olivia P. Olaguer and Eduardo Olaguer were removed as administrators of the estate and on February 12, 1980, plaintiff Ma. Linda Olaguer Montayre was appointed administrator by the Probate Court. 

The decedent Lino Olaguer have had three marriages. He was first married to Margarita Ofemaria who died April 6, 1925. His second wife was Gloria Buenaventura who died on July 2, 1937. The third wife was the defendant Olivia P. Olaguer.

Jose Olaguer acting upon the general power of attorney sold 8 parcels of land to Emilio Ongjoco. 

On 28 January 1980, the Estate of Lino Olaguer filed an action for the Annulment of Sales of Real Property and/or Cancellation of Titles in the then Court of First Instance of Albay. The plaintiffs therein alleged that the sales of the following properties belonging to the Estate of Lino Olaguer to Estanislao Olaguer were absolutely simulated or fictitious, the plaintiffs likewise prayed that the resulting Transfer Certificates of Title issued to Jose Olaguer, Virgilio Olaguer, Cipriano Duran and the PNB be annulled.

ISSUE:

Whether General Power of Attorney was sufficient to effect the sale of the subject properties

HELD:

Yes, the general power of attorney was sufficient

The Supreme Court held that while the law requires a special power of attorney, the general power of attorney was sufficient in this case, as Jose A. Olaguer was expressly empowered to sell any of Virgilio's properties; and to sign, execute, acknowledge and deliver any agreement therefor.  Even if a document is designated as a general power of attorney, the requirement of a special power of attorney is met if there is a clear mandate from the principal specifically authorizing the performance of the act.  The special power of attorney can be included in the general power when the act or transaction for which the special power is required is specified therein.  

On its face, the written power of attorney contained the signature of Virgilio Olaguer and was duly notarized. As such, the same is considered a public document and it has in its favor the presumption of authenticity and due execution, which can only be contradicted by clear and convincing evidence.

DOMINGO v. DOMINGO

DOMINGO v. DOMINGO

G.R. No. L-30573; October 29, 1971

Ponente: J. Makasiar

FACTS:

On June 2, 1956, Vicente M. Domingo granted Gregorio Domingo, a real estate broker, the exclusive agency to sell his lot No. 883 of Piedad Estate with an area of about 88,477 square meters at the rate of P2.00 per square meter (or for P176,954.00) with a commission of 5% on the total price, if the property is sold by Vicente or by anyone else during the 30-day duration of the agency or if the property is sold by Vicente within three months from the termination of the agency to a purchaser to whom it was submitted by Gregorio during the continuance of the agency with notice to Vicente. The said agency contract was in triplicate, one copy was given to Vicente, while the original and another copy were retained by Gregorio.

On June 3, 1956, Gregorio authorized the intervenor Teofilo P. Purisima to look for a buyer, promising him one-half of the 5% commission.Thereafter, Teofilo Purisima introduced Oscar de Leon to Gregorio as a prospective buyer.

Oscar de Leon submitted a written offer which was very much lower than the price of P2.00 per square meter. Vicente directed Gregorio to tell Oscar de Leon to raise his offer. After several conferences between Gregorio and Oscar de Leon, the latter raised his offer to P109,000.00 on June 20 and Vicente agreed. 

Upon demand of Vicente, Oscar de Leon issued to him a check in the amount of P1,000.00 as earnest money, after which Vicente advanced to Gregorio the sum of P300.00. Oscar de Leon confirmed his former offer to pay for the property at P1.20 per square meter in another letter. Subsequently, Vicente asked for an additional amount of P1,000.00 as earnest money, which Oscar de Leon promised to deliver to him. 

Pursuant to his promise to Gregorio, Oscar gave him as a gift or propina the sum of 1,000.00 for succeeding in persuading Vicente to sell his lot at P1.20 per square meter or a total in round figure of P109,000.00. This gift of P1,000.00 was not disclosed by Gregorio to Vicente. Neither did Oscar pay Vicente the additional amount of P1,000.00 by way of earnest money. 

When the deed of sale was not executed on August 1, 1956 as stipulated nor on August 16, 1956 as extended by Vicente, Oscar told Gregorio that he did not receive his money from his brother in the United States, for which reason he was giving up the negotiation including the amount of P 1,000 given as earnest money to Vicente and the P 1,000 given to Gregorio as propina or gift. 

When Oscar did not see him after several weeks, Gregorio sensed something fishy. So, he went to Vicente and read a portion to the effect that Vicente was still committed to pay him 5% commission. Vicente grabbed the original of the document and tore it to pieces. 

From his meeting with Vicente, Gregorio proceeded to the office of the Register of Deeds of Quezon City, where he discovered a deed of sale executed on September 17, 1956 by Amparo Diaz.

Upon thus learning that Vicente sold his property to the same buyer, Oscar de Leon and his wife, he demanded in writing payment of his commission on the sale price of P109,000.00.

Vicente stated that Gregorio is not entitled to the 5% commission because he sold the property not to Gregorio's buyer, Oscar de Leon, but to another buyer, Amparo Diaz, wife of Oscar de Leon

ISSUE:
Whether Gregorio was entitled to receive the 5% commission

HELD:

No, Gregorio is not entitled to receive the 5% commission.

The Supreme Court held that the law imposes upon the agent the absolute obligation to make a full disclosure or complete account to his principal of all his transactions and other material facts relevant to the agency, so much so that the law as amended does not countenance any stipulation exempting the agent from such an obligation and considers such an exemption as void. 

Hence, by taking such profit or bonus or gift or propina from the vendee, the agent thereby assumes a position wholly inconsistent with that of being an agent for his principal, who has a right to treat him, insofar as his Commission is concerned, as if no agency had existed. 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.

NAPOCOR v. NATIONAL MERCHANDISING Corp.

NAPOCOR v. NATIONAL MERCHANDISING Corp.

G.R. Nos. L-33819 and L-33897; October 23, 1982

Ponente: J. Aquino

FACTS:
Plaintiff-appellant National Power Corporation (NPC) and defendant- appellant National Merchandising Corporation (NAMERCO), the Philippine representative of New York-based International Commodities Corporation, executed a contract of sale of sulfur with a stipulation for liquidated damages in case of breach. 

Defendant-appellant Domestic Insurance Company executed a performance bond in favor of NPC to guarantee the seller's obligation. In entering into the contract, Namerco, however, did not disclose to NPC that Namerco's principal, in a cabled instruction, stated that the sale was subject to availability of a steamer, and contrary to its principal's instruction, Namerco agreed that non-availability of a steamer was not a justification for non-payment of liquidated damages. 

The New York supplier was not able to deliver the sulfur due to its inability to secure shipping space. Consequently, the Government Corporate Counsel rescinded the contract of sale due to the supplier's non-performance of its obligations, and demanded payment of liquidated damages from both Namerco and the surety. Thereafter, NPC sued for recovery of the stipulated liquidated damages. After trial, the Court of First Instance rendered judgment ordering defendants-appellants to pay solidarity to the NPC reduced liquidated damages with interest.

ISSUE:
Whether NaMerCo exceeded their authority

HELD:
Yes, NaMerCo exceeded their authority.

The Supreme Court held that before the contract of sale was signed Namerco was already aware that its principal was having difficulties in booking shipping space.

It is being enforced against the agent because article 1897 implies that the agent who acts in excess of his authority is personally liable to the party with whom he contracted.
Moreover, the rule is complemented by article 1898 of the Civil Code which provides that "if the agent contracts in the name of the principal, exceeding the scope of his authority, and the principal does not ratify the contract, it shall be void if the party with whom the agent contracted is aware of the limits of the powers granted by the principal".
Namerco never disclosed to the Napocor the cabled or written instructions of its principal. For that reason and because Namerco exceeded the limits of its authority, it virtually acted in its own name and not as agent and it is, therefore, bound by the contract of sale which, however, is not enforceable against its principal.

EUROTECH INDUSTRIAL TECHNOLOGIES, INC. v. CUIZON

EUROTECH INDUSTRIAL TECHNOLOGIES, INC. v.  CUIZON

G.R. No. 167552; April 23, 2007

Ponente: J. Chico-Nazario

FACTS:

From January to April 1995, petitioner sold to Impact Systems various products allegedly amounting to P91,338.00 pesos. Subsequently, respondents sought to buy from petitioner one unit of sludge pump valued at P250,000.00 with respondents making a down payment of P50,000.00.  When the sludge pump arrived from the United Kingdom, petitioner refused to deliver the same to respondents without their having fully settled their indebtedness to petitioner. Thus, on 28 June 1995, respondent EDWIN and Alberto de Jesus, general manager of petitioner, executed a Deed of Assignment of receivables in favor of petitioner.

Despite the existence of the Deed of Assignment, respondents proceeded to collect from Toledo Power Company the amount of P365,135.29.  Alarmed by this development, petitioner made several demands upon respondents to pay their obligations. As a result, respondents were able to make partial payments to petitioner. On 7 October 1996, petitioner's counsel sent respondents a final demand letter wherein it was stated that as of 11 June 1996, respondents' total obligations stood at P295,000.00 excluding interests and attorney's fees.  Because of respondents' failure to abide by said final demand letter, petitioner instituted a complaint for sum of money, damages, with application for preliminary attachment against herein respondents

By way of special and affirmative defenses, respondent EDWIN alleged that he is not a real party in interest in this case. According to him, he was acting as mere agent of his principal, which was the Impact Systems, in his transaction with petitioner and the latter was very much aware of this fact.

ISSUE:
Whether respondent EDWIN exceeded his authority when he signed the Deed of Assignment thereby binding himself personally to pay the obligations to petitioner

HELD:

No, EDWIN did not exceeded his authority when he signed the Deed of Assignment

The Supreme Court held that article 1897 reinforces the familiar doctrine that an agent, who acts as such, is not personally liable to the party with whom he contracts. The same provision, however, presents two instances when an agent becomes personally liable to a third person. The first is when he expressly binds himself to the obligation and the second is when he exceeds his authority. In the last instance, the agent can be held liable if he does not give the third party sufficient notice of his powers. Respondent EDWIN does not fall within any of the exceptions contained in this provision.

The Deed of Assignment clearly states that respondent EDWIN signed thereon as the sales manager of Impact Systems. 

Edwin Cuizon acted well-within his authority when he signed the Deed of Assignment. To recall, petitioner refused to deliver the one unit of sludge pump unless it received, in full, the payment for Impact Systems' indebtedness.

DBP v. CA

DBP v. CA

G.R. No. 109937; March 21, 1994

Ponente: J. Quiason

FACTS:
In May 1987, Juan B. Dans, together with his wife Candida, his son and daughter-in-law, applied for a loan of P500,000.00 with the Development Bank of the Philippines (DBP), Basilan Branch. As the principal mortgagor, Dans, then 76 years of age, was advised by DBP to obtain a mortgage redemption insurance (MRI) with the DBP Mortgage Redemption Insurance Pool (DBP MRI Pool).
A loan, in the reduced amount of P300,000.00, was approved by DBP on August 4, 1987 and released on August 11, 1987. From the proceeds of the loan, DBP deducted the amount of P1,476.00 as payment for the MRI premium. On August 15, 1987, Dans accomplished and submitted the "MRI Application for Insurance" and the "Health Statement for DBP MRI Pool."
On August 20, 1987, the MRI premium of Dans, less the DBP service fee of 10 percent, was credited by DBP to the savings account of the DBP MRI Pool. 
On September 3, 1987, Dans died of cardiac arrest. The DBP, upon notice, relayed this information to the DBP MRI Pool. On September 23, 1987, the DBP MRI Pool notified DBP that Dans was not eligible for MRI coverage, being over the acceptance age limit of 60 years at the time of application. 
On October 21, 1987, DBP apprised Candida Dans of the disapproval of her late husband's MRI application. The DBP offered to refund the premium of P1,476.00 which the deceased had paid, but Candida Dans refused to accept the same, demanding payment of the face value of the MRI or an amount equivalent to the loan. She, likewise, refused to accept anex gratia settlement of P30,000.00, which the DBP later offered.
On February 10, 1989, respondent Estate, through Candida Dans as administratrix, filed a complaint with the Regional Trial Court, Branch I, Basilan, against DBP and the insurance pool for "Collection of Sum of Money with Damages." Respondent Estate alleged that Dans became insured by the DBP MRI Pool when DBP, with full knowledge of Dans' age at the time of application, required him to apply for MRI, and later collected the insurance premium thereon.

ISSUE:
Whether DBP exceeded its authority when it approved the application of Dans


HELD:
Yes, DBP exceeded its authority.

The Supreme Court held that as an insurance agent, DBP made Dans go through the motion of applying for said insurance, thereby leading him and his family to believe that they had already fulfilled all the requirements for the MRI and that the issuance of their policy was forthcoming. Apparently, DBP had full knowledge that Dan's application was never going to be approved. The maximum age for MRI acceptance is 60 years as clearly and specifically provided in Article 1 of the Group Mortgage Redemption Insurance Policy signed in 1984 by all the insurance companies concerned.
Under Article 1987 of the Civil Code of the Philippines, "the agent who acts as such is not personally liable to the party with whom he contracts, unless he expressly binds himself or exceeds the limits of his authority without giving such party sufficient notice of his powers."
The DBP is not authorized to accept applications for MRI when its clients are more than 60 years of age. Knowing all the while that Dans was ineligible for MRI coverage because of his advanced age, DBP exceeded the scope of its authority when it accepted Dan's application for MRI by collecting the insurance premium, and deducting its agent's commission and service fee.

SALFIE ALCAN v. IMPERIAL VEGETABLE OIL CO., Inc.

SALFIE ALCAN v. IMPERIAL VEGETABLE OIL CO., Inc.

G.R. No. 126751; March 28, 2001

Ponente: J. Ynares-Santiago

FACTS:

Petitioner Safic Alcan & Cie (hereinafter, "Safic") is a French corporation engaged in the international purchase, sale and trading of coconut oil.

Petitioner Safic alleged that on July 1, 1986 and September 25, 1986, it placed purchase orders with IVO for 2,000 long tons of crude coconut oil, valued at US$222.50 per ton to be delivered within the month of January 1987. Private respondent, however, failed to deliver the said coconut oil and, instead, offered a "wash out" settlement, whereby the coconut oil subject of the purchase contracts were to be "sold back" to IVO at the prevailing price in the international market at the time of wash out. Thus, IVO bound itself to pay to Safic the difference between the said prevailing price and the contract price of the 2,000 long tons of crude coconut oil, which amounted to US$293,500.00. IVO failed to pay this amount despite repeated oral and written demands.

Safic alleged that on eight occasions between April 24, 1986 and October 31, 1986, it placed purchase orders with IVO for a total of 4,750 tons of crude coconut oil. When IVO failed to honor its obligation under the wash out settlement narrated above, Safic demanded that IVO make marginal deposits within forty-eight hours on the eight purchase contracts in amounts equivalent to the difference between the contract price and the market price of the coconut oil, to compensate it for the damages it suffered when it was forced to acquire coconut oil at a higher price. IVO failed to make the prescribed marginal deposits on the eight contacts, in the aggregate amount of US$391,593.62, despite written demands.

Hence, Safic prayed that IVO be ordered to pay the sums of US$293,500.00 and US$391,593.62, plus attorney's fees and litigation expenses. 

IVO raised the following special affirmative defenses: Safic had no legal capacity to sue because it was doing business in the Philippines without the requisite license or authority; the subject contracts were speculative contracts entered into by IVO's then President, Dominador Monteverde, in contravention of the prohibition by the Board of Directors against engaging in speculative paper trading, and despite IVO's lack of the necessary license from Central Bank to engage in such kind of trading activity.

ISSUE:
Whether the act of Dominador Monteverde binds IVO

HELD:

No, the act of Dominador Monteverde without the authorization of the Board of Directors did not bind IVO.

The Supreme Court ruled that Monteverde had no blanket authority to bind IVO to any contract. He must act according to the instructions of the Board of Directors. Even in instances when he was authorized to act according to his discretion, that discretion must not conflict with prior Board orders, resolutions and instructions. The evidence shows that the IVO Board knew nothing of the 1986 contracts  and that it did not authorize Monteverde to enter into speculative contracts.



Safic can not rely on the doctrine of implied agency because before the controversial 1986 contracts, IVO did not enter into identical contracts with Safic. The basis for agency is representation and a person dealing with an agent is put upon inquiry and must discover upon his peril the authority of the agent.

Under Article 1898  of the Civil Code, the acts of an agent beyond the scope of his authority do not bind the principal unless the latter ratifies the same expressly or impliedly. It also bears emphasizing that when the third person knows that the agent was acting beyond his power or authority, the principal can not be held liable for the acts of the agent. If the said third person is aware of such limits of authority, he is to blame, and is not entitled to recover damages from the agent, unless the latter undertook to secure the principal's ratification.