A&P Compiled Digests No. 2
In order that prescription may constitute a valid defense and it may be considered on appeal, it must be specifically pleaded inthe answer and proven with the same degree of certainty withwhich an essential allegation in a civil action is established.Otherwise it will not be taken into consideration, much less if it is alleged for the first time on appeal.
FOURTH ISSUE: WON ATTORNEY’S FEES SHOULD BE PAID
The plaintiff violated the Usury Law in charging compoundinterest notwithstanding the fact that it has not been sostipulated and that adding these sums to the stipulatedinterest the average exceeds the maximum rate of interest that may be charged for the loan which has been the subject matterof the transaction. This violation falls under the precept of section 6 of the Usury Law and the plaintiff is obliged to paythe fees of the attorney for the defendants.
FIFTH ISSUE (AGENCY RELEVANT): WON DEFENDANTS RATIFIED ALL THE OBLIGATIONS CONTRACTED BY THEIR ATTY-IN-FACT A
ND WHAT IS THE LATTER’S SCOPE OF AUTHORITY
-NO; ONLY LIMITED
The terms of the power of atty are limited; the agent wasthereby authorized only to borrow any amount of moneywhich he deemed necessary. There is nothing, however, toindicate that the defendants had likewise authorized him toconvert the money obtained by him to his personal use.
With respect to a power of attorney of special character, it cannot be interpreted as also authorizing the agent to disposeof the money as he pleased, particularly when it does not appear that such was the intention of the principals, and inapplying part of the funds to pay his personal obligations, heexceeded his authority (art. 1714, Civil Code; Bank of thePhilippine Islands vs. De Coster, 47 Phil., 594 and 49 Phil.,574).
In the case like the present one, it should be understood that the agent was obliged to turn over the money to the principalsor, at least, place it at their disposal.
The plaintiff contends that the agent's act of employing part of the loan to pay his personal debts was ratified by thedefendants in their letter to him dated August 21, 1927(Exhibit E). This court has carefully read the contents of saiddocument and has found nothing implying ratification orapproval of the agent's act. In it the defendants confinedthemselves to stating that they would notify their agent of thematurity of the obligation contracted by him. They saidnothing about whether or not their agent was authorized touse the funds obtained by him in the payment of his personalobligations.
Of the loan of P28,000, the agent applied the sum of P10,188.29 to the payment of his personal debt to the plaintiff.The balance of P17,811.71 constitutes the capital which thedefendants are obliged to pay by virtue of the power conferredupon their agent and the mortgage deed.
STRONG v. GUTIERREZ RUPIDE
6 PHIL 680
Mrs. Strong owned 800 shares of the capital stock of PhilippineSugar Estates Development Co., Limited, an anonymous societyformed to hold the Dominican friar lands. Repide bought themthrough a broker who dealt with Mrs. Strong's agent, Jones,who was in possession of the script and who had made the salewithout Mrs. Strong's knowledge. Repide was a director, wasthe managing agent and was the majority stockholder of thesociety.
Plaintiffs brought this case to recover the 800 shares.
(Relevant) WON her agent had the power to sell or deliver thestocks. NO2.
WON its sale, through her agent, was procured by fraud on thepart of Repide. NO
Based on OCC 1712, an agency stated in general terms onlyincludes acts of administration. In order to compromise,alienate, mortgage, or to execute any, other act of strict ownership an express mandate is required. The expressmandate required by law to enable an appointee of an agencycouched in general terms to sell must be one that expresslymentions a sale or that includes a sale as a necessaryingredient of the act mentioned. The right to sell shall beexpress. Here, there was no proof of an effective power givenJones to dispose of this stock.
European civil law and American common law established that acts of agents, beyond the limitation of their power are nulland that third persons dealt with them at their peril and arebound to inquire as to the extent of the power of the agent with whom they contract and that where neither the actualpower not the appearance of it, for which the principal isresponsible, exists, a third party is not protected without suchinquiry. Here, Repide relied unquestioningly upon Jones'assumption of authority and took the risk.
The case also discussed that in a certain Dalloz' annotation,after laying down the admitted proposition of the acts of anagent beyond his limited powers are null, states 3qualifications whereby the principal is held bound:1)
where his acts have contributed to deceive a third personin good faith;2)
where the limitations upon the power created by himcould not have been known by a third person, and3)
where he has placed in the hands of the agent aninstrument signed by him in blank.2.
The defendant violated no duty in not communicating to theplaintiff his purpose in buying her shares and has been guiltyof no fraud. Managers are not given the duty to the members inrespect to their individual stock, which is fully recognized as aseparate property, whose character and transmission isprovided for in laws peculiar to it.
KATIGBAK v. TAI HUNG CO.
52 PHIL 622
Nov 9, 1921 - Po Tecsi executed a general power of attorney infavor of his brother Po Ejap, empowering and authorizing himto perform on his behalf and as his lawful agent the following:
“to buy, sell, or barter, assign or admit in acquittance an
instrument, or in any other manner to acquire or convey
all sorts of property, real and personal, usinesses and industries,credits, rights, and actions belonging to me,
for whatever pricesand under the conditions which he may stipulate, paying andreceiving payment in cash or in installments, and to executethe proper instruments with the formalities provided by the
On Dec 15, 1921, Po Tecsi acknowledged in an instrument anindebtedness to Po Ejap in the amount of P68,000 for theproperties Po Ejap had sold to him.
Mar 31, 1923
Po Ejap executed a second mortgage on hisown land in favor of Limjenco. This land, which is the subject of the case, was at that time, mortgaged to PNB to secure thepayment of the sum of P60,000 with 7% interest. He thereaftersold the land with all its improvements to Po Tecsi.
Nov 22, 1923
Acting on behalf of Po Tecsi and with thespecial power granted to him, he sold the subject land with allits improvements to Katigbak. The only mortgage mentionedin the instrument was the one executed with PNB.
He sold theland without recording his power of attorney or the sale in thetitle.
At the time of the sale, Po Tecsi was in possession of theland.
Oct 22, 1924
Po Tecsi leased a part of the land to Uy Chia fora period of 5 years.
Po Tecsi sent letters complaining of Po Ejap’s pressuring him
to pay the rent and also to call the attention of Po Ejap forleasing the land without consulting him.
In 1925, the second mortgage was cancelled.
Po Tecsi died, and his son Po Sun Suy sent a liquidation of accounts over the propert to Po Ejap. Po Sun Suy wasappointed administrator of
Po Tecsi’s estate, and he includedthe land as one of hid dad’s properties.
In 1927, Po Ejap assigned all his rights and actions in the credit
of P68,000 against Po Tecsi to Po Sun Boo (Po Ejap’s son) who
bought the land from Katigbak. This purchase was madeknown by Po Sun Boo to Po Sun Suy to deal with him regardingthe payment of the rent.