● As mention consent as an element.

In order to properly give consent the parties to the

contract of agency must be capacitated.Capacity as between the principal and agent.
● We follow the principles of oblicon if either the principal or the agent is incapable of
giving consent the contract is voidable, only one of the parties.
● If one of the parties is incapable of giving consent it is voidable
● Both of the parties are incapacitated then the contract is unenforceable.
● insofar as the obligation to the principal are concerned the agent must be competent to
bind himself
● The capacity of the principal or agent with regard to third persons earlier that was
between the principal and the agent now what about principal and agent on the one
hand and third persons
● The principal is the one that is incapacitated and the agent has entered into a contract
with a third person and the contract is voidable. Why? because the contract is entered
into on behalf of the principal.
● The contract is in reality between the principal in the third person. But if the agent was
aware of the principal's incapacity then he will be personally liable. If the agent on the
other hand was ignorant of the principal's incapacity then he is not liable. these rules are
governed by the principal's of good faith and bad faith.
● What if the incapacity of the principal occurs during the effectivity of the agency? then
generally the agency is extinguished pursuant to article in 1919. However if the agent
and the third party both acted in good faith without knowledge of the supervening
incapacity of the principal then public policy dictates that the contract will remain valid.
● What if it is the agent that is incapacitated? let say some minor, as long as the principal
has the necessary capacity to contract then the agent may still bind the principal to the
third party since the agent is only an instrument of the principal who is acting in a
representative capacity.
● the rule is that when it comes to third persons, it is the legal capacity of the principal that
matters, the legal capacity of the principal rather than the agent that matters.
● According to the case of mendoza vs de guzman. The capacity of the agent is of no
moment because the agents personality is merely an extension of the principal's.
● If the principal has a necessary capacity that is enough, or in other words a principal
must have legal capacity to enter into a contract.
● And the agent's capacity with regard to a third person is usually immaterial. In other
words the agent does not have to possess full capacity to act for himself, as such the
incapacitated agent can bind the principal since the agent is only an instrument of the
principal who acts in a representative capacity and exercises a derivative authority. He
derives his authority from the principal, just remember that the contract is entered
into between the principal and the third person, the agent is just an instrument.
● Consent of both principal and agent is necessary to create an agency. The principal
must intend that the agent shall act for him. And the agent must intend to accept the
authority and act on it. The intention of the parties must be expressed either in words or
conduct between them, without this intent that is generally no agency.
● In order to an agency to exist both the principal and the agent must give their consent
either expressly or impliedly. There is no problem with express consent, it's orally or in
writing.
● Implied consent under article 1869, consent on the part of the principal is implied in the
following cases; (1) from the acts of the principal such as when he actively holds out
another as his agent or has habitually and previously employed the agent as such; (2)
from the silence or lack of action of the principal; (3) from the failure of the principal to
repudiate or deny the agency provided that the principal knows that another person is
acting on his behalf without authority.
● The agent must also gave his consent to be bound to the contract of agency as an
agent. How is the acceptance of the agent given? it may be expressed again orally or in
writing, or the agents acceptance may be implied. In Article 1870 (1) in the acceptance
of the agent may be implied through the acts of the agent which carry out the agency.
● Let say the agent didn't say ok i'll be your agent, but he didn't say that but he went and
did it anyway. so now we can imply the existence of an agency.
● Another instance is his silence. The silence of the agent or inaction according to the
circumstances. (Take note of 1871 and 1872)
● Article 1871, talks about persons who are present. Meaning the principal and agent are
face to face. In that case agency may be implied if the principal delivers his power of
attorney to the agent and the agent receives it without any objection. And take note
however that this is only a presumption of acceptance by the agent and the it can be
rebutted by contrary proof.
● Article 1872, which deals with the persons who are absent. Meaning that the principal
and agent are not physically present. In which case the general rule is that acceptance
cannot be implied from the silence of the agent. However the law gives us exceptions,
when there will be implied acceptance in case of their absence; and (1) where the
principal transmits power of attorney to the agent and the agent receives it without any
objection, take note that it must be the agent who receives the power of attorney (which
is a written authorization to perform specified acts on behalf of the principal)
● When the principal however entrusts to the agent by letter or telegram a power of
attorney with respect to the business in which the agent is habitually engaged as an
agent and the agent did not reply to the letter or telegram ok then there's also an implied
agency take note that sheer the mere failure to reply does not mean that the agency has
been accepted unless at first the power of attorney is with respect to the business in
which he is a habitually engaged as an agent or second in 1870 if the acceptance can
be inferred from the acts of the agent which carry out the agency.
●