Professional Documents
Culture Documents
ATP Notes 8
ATP Notes 8
EXCEPTION: A presumption of agency may arise, however, 3. Authority outside of court -The relation of
in those few cases where an agency may arise by operation attorney and client is, in many respects, one of
of law or to prevent unjust enrichment. agency and the ordinary rules of agency apply to
such relation. The extent of authority of a lawyer,
Authority of attorney to appear on behalf of his client when acting on behalf of his client outside of court
is measured by the same test as that which is
Rule 138 of the Rules of Court applied to an ordinary agent.
SEC 21. Authority of attorney to appear – An attorney is Article 1870. Acceptance by the agent may also be
presumed to properly authorized to represent any cause in express, or implied from his acts which carry out the
which he appears, and no written power of attorney is agency, or from his silence or inaction according to the
required to authorize him to appear in court for his client, circumstance.
but the presiding judge may, on motion of either party and
on reasonable grounds therefor being shown, require any Article 1871. Between persons who are present, the
attorney who assumes the right to appear in a case to acceptance of agency may also be implied if the
produce or prove the authority under which he appears, principal delivers his power of attorney to the agent
and to disclose, whenever pertinent to any issue, the name and the latter receives it without any objection.
of the person who employed him, and may thereupon
makes such order as justice requires. An attorney willfully Implied acceptance by the agent, the law distinguishes
appearing in court for a person without being employed, between cases:
unless by leave of the court, may be punished for contempt
as an officer of the court who has misbehaved in his official 1. Where the persons are present (Art. 1871)
transactions. 2. Where persons are absent (Art. 1872)
SEC 22. Attorney who appears in lower court presumed to Definition and purpose of a power of attorney
represent client on appeal – An attorney who appears de
parte in a case before a lower court shall be presumed to Power of Attorney – is an instrument in writing by which
continue representing his client on appeal, unless he files a one person, as principal, appoints another as his agent and
formal petition withdrawing his appearance in the confers upon him the authority to perform certain
appellate court. specified acts or kinds of acts on behalf of the principal.
The written authorization itself is the power of attorney,
SEC 23. Authority of attorneys to bind clients – Attorneys and this is clearly indicated by the fact that it has also been
have authority to bind their clients in any case by any called a “letter of attorney”.
agreement in relation thereto made in writing, and in
taking appeals, and in all matters of ordinary judicial PURPOSE: To evidence the authority of the agent to third
procedure. But they cannot, without special authority, parties within whom the agent deals.
compromise their client’s litigation, or receive anything in
discharge of a client’s claim but the full amount in cash. NOTE: The person holding a power of attorney is shown
and designated as an “attorney-in-fact”, thus distinguishing
2. Scope of authority such person from an attorney-at-law.
General Rule: An act performed by counsel within the *A power of attorney is valid although no notary public
scope of a “general or implied authority” is regarded as an intervened in its execution.
act of the client.
Construction of powers of attorney
Exception:
1) Rule of strict construction
a. Where reckless or gross negligence of counsel
deprives the client of due process of law General Rule: A power of attorney must be strictly
construed and strictly pursued.
2 ways of giving notice of agency with different effects:
Under this rule, the instrument will be held to grand
only those powers which are specified and defined, 1) If by special information (e.g., by letter), the
and the agent may neither go beyond nor deviate from person appointed as agent is considered such with
the power of attorney. respect to the person to whom it was given.
2) If by public advertisement, the agent is
2) Qualification of the rule – the rule is not absolute considered as such with regard to any person.
and should not be applied to the extent of Public advertisement may be made in any form –
destroying the very purpose of the power. through the newspaper, radio, etc. and by posters
or billboards.
NOTE: If the language will permit, a construction should be
adopted which will carry out, instead of defeat, the Manner of revocation
purpose of the appointment. Even if there are repugnant
clauses in a power of attorney, they should be reconciled, if Art. 1921. If the agency has been entrusted for the purpose
possible, so as to give effect to the instrument in keeping of contracting with specified persons, its revocation shall
with its general intent or predominant purpose. not prejudice the latter if they were not given notice
Furthermore, the instrument should always be deemed to thereof.
give such powers as are essential or usual and reasonably
necessary and proper in effectuating the express power. Art. If the agent had general powers, revocation of the
agency does not prejudice third persons who acted in good
NOTE 2.0: Powers of attorney are ordinarily subjected to a faith and without knowledge of the revocation. Notice of
strict construction as to precluded all authority not revocation in a newspaper of general circulation is a
expressly given, or necessarily to be inferred. sufficient warning to third persons.
Article 1872. Between persons who are absent, the NOTE: Revocation made in any manner is effective where
acceptance of the agency cannot be implied from the the person dealing with the agent has actual knowledge
silence of the agent, except: thereof; otherwise, bad faith and fraud would be
committed.
1) When the principal transmits his power of
attorney to the agent, who receives it without Estoppel to deny agency
objection;
2) When the principal entrusts to him by letter or 1) Estoppel of agent – one professing to act as agent
telegram a power of attorney with to the for another may be estopped to deny his agency
business in which he is habitually engaged as both as against his asserted principal and the third
an agent, and he did not reply to the letter or persons interested in the transaction in which he
telegram. engaged.
2) Estoppel of principal
NOTE: It should be noted that under Article 1872, the a) As to agent – one who knows that another
principal transmits the power of attorney to the agent. In is acting as his agent and fails to repudiate
Article 1871, he personally delivers the power of attorney his acts, or accepts the benefits of them,
to the agent. will be estopped to deny the agency as
against such other.
Article 1873. If a person specially informs another or b) As to sub-agent – to estop the principal
states by public advertisement that he has given a from denying his liability to a third
power of attorney to a third person, the latter thereby person, he must have known or be
becomes a duly authorized agent, in the former case charged with knowledge of the fact of the
with respect to the person who received the special transaction and the terms of the
information, and in the latter case with regard to any agreement between the agent and sub-
person. agent.
c) As to third persons – one who knows that
The power shall continue to be in full force until the another is acting as his agent or permitted
notice is rescinded in the same manner in which it was another to appear as his agent, to the
given. injury of third persons who have dealt
with the apparent agent as such in good
Communication of existence of agency faith and in the exercise of reasonable
prudence, is estopped to deny the agency.
(b) Being an actual Should be restricted to
3) Estoppel of third persons – a third person, having agency, is a fact to be cases in which the
dealt with one as an agent may be estopped to prove by deduction or authority is not real
deny the agency as against the principal, agent, or inferences from other but apparent,
third persons in interest. He will not, however, be facts
estopped where he has withdrawn from the NOTE: Agency by estoppel is well recognized in the law. If
contract made with the unauthorized agent before the estoppel is on the ground of negligence or fraud on the
receiving any benefits thereunder. part of the principal, the agency is allowed upon the theory
4) Estoppel of the government – the government is that, when one of two innocent persons must suffer loss,
neither estopped by mistake or error on the part the loss should fall upon him whose conduct brought about
of its agents. But it may be estopped through the situation.
affirmative acts of its officers acting within the
scope of their authority. Article 1874. When a sale of a piece of land or any
interest therein is through an agent, the authority of
the latter shall be in writing; otherwise, the sale shall
Agency by estoppel and implied agency distinguished be void.
Right of agent to compensation in case of double In determining the amount of the fee, it is proper to
agency consider:
1. With knowledge of both principals – such agency is (1) The time and labor required, the novelty and difficulty
disapproved of by law UNLESS the agent acted of the questions involved, and the skill requisite to conduct
with full knowledge and free consent of both properly the cause;
principals, or unless his employment was merely (2) Whether the acceptance of employment in the
to bring the parties together. In this case, recovery particular case will preclude the lawyer’s appearance for
may be had by the agent. (Domingo v Domingo) others in cases likely to arise out of the transaction, and in
which there is a reasonable expectation that otherwise he
Example: If two persons desire to negotiate a sale of would be employed, or will involve the loss of other
property, they may agree to delegate to a third person the business while employed in the particular case or
power to fix the terms. It may be said that such third antagonisms with other clients;
person is an arbitrator chose to settle the differences (3) The customary charges of the bar for similar services;
(4) The amount involved in the controversy and the to do only a particular act or a series of acts of very limited
benefits resulting to the client from the services; scope. He has less power than a general agent.
(5) The contingency or the certainty of the compensation;
and NOTE: A principal may have as many special agents as
(6) The character of the employment, whether casual or occasions may require and may have a general agent in
for an established and constant client. each line of his business and each of several places, he can
only have one universal agent.
No one of these consideration in itself is controlling. They
are mere guides in ascertaining the real value of the Special types of agent
service.
The more common special types of agents are the
In fixing fees, it should never be forgotten that the following:
profession is a branch of the administration of justice and
not a mere money getting trade.36 (Sec. 12, Canons of (1) Attorney at law, or one whose business is to represent
Professional Ethics.) clients in legal proceedings;
(2) Auctioneer, or one whose business is to sell property
Article. 1876. An agency is either general or special. for others to the highest bidder at a public sale;
The former comprises all the business of the principal. (3) Broker, or one whose business is to act as intermediary
The latter, one or more specific transactions. between two other parties such as insurance broker and
real estate broker;
General and special agencies. The distinction here is (4) Factor (synonymous with commission merchant), or
based on the scope of the business covered. A general one whose business is to receive and sell goods for a
agency must not be confused with one couched in general commission, being entrusted with the possession of the
terms (Art. 1877.) which is a special agency when it goods involved in the transaction. (see Art. 1903.);
involves only one or more specific transactions. (Art. (5) Cashier in bank, or one whose business is to represent
1876.) a banking institution in its financial transactions; and; (6)
Attorney-in-fact
Classes and kinds of agency
Attorney-in-fact - is one who is given authority by his
According to the nature and extent of their authority principal to do a particular act not of a legal character. The
agents have been classified into universal, general, and term is, in loose language, used to include agents of all
special or particular. kinds, but in its strict legal sense, it means an agent having
a special authority created by deed.
(1) A universal agent is one employed to do all acts that
the principal may personally do, and which he can lawfully
delegate to another the power of doing. A contract creating
a universal agency normally includes the following
delegation: “full power and authority to do and perform
any and every act that I may legally do and every power
necessary to carry out the purposes for which it is
granted.”
(2) A general agent is one employed to transact all the
business of his principal, or all business of a particular kind
or in a particular place, or in other words, to do all acts,
connected with a particular trade, business, or
employment. He has authority to do all acts connected
with or necessary to accomplish a certain job. A manager
of a store is an example of a general agent.