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A C B O 2007 Civil Law: Summer Reviewer
A C B O 2007 Civil Law: Summer Reviewer
Civil Law
SUMMER REVIEWER
the rule colludes with the Agent in dealing with the Buyer can deal with the
agent to defraud the thing received is bound thing as he pleases,
principal. to act according to the being the owner
instructions of his
Distinction between Agency & Lease of Service principal
Agency Lease of Service
Representation Employment Distinction between Agent & Contractor
Agent exercises Lessor ordinarily Agent Independent Contractor
discretionary powers performs only ministerial Represents his principal Employed by the
functions employer
3 persons are involved: 2 persons are involved: Acts under the principal’s Acts according to his own
principal, agent and the lessor and lessee control and instruction method
3rd person with whom the Principal is liable for torts Employer not liable for
agent contracts committed by the agent torts committed by the
Relates to commercial Relates more to the within the scope of his independent contractor.
or business matters of mere manual authority
transactions or mechanical
execution Distinction between Agency and Partnership
Agency Partnership
Distinction between Agency & Guardianship An agent must submit to A co-partner is not
Agency Guardianship the principal’s right to subject to co-partner’s
Agent represents a A guardian represents an control right to control, unless
capacitated person incapacitated person. there is an agreement to
Agent is appointed by Guardian is appointed that effect
the principal and can be by the court and stands The agent assumes no The partner binds not
removed by the latter. in loco parentis. personal liability where only the firm members
Agent is subject to the Guardian is not subject to he acts within the scope but himself as well
directions of the principal. the directions of the ward of his authority
but must act for the The agent takes his The profits belong to all
benefit of the latter agreed share of profits the partners as common
Agent can make the Guardian has no power not as owner but as an proprietors in agreed
principal personally to impose personal agreed measure of proportions
liable. liability on the ward. compensation for his
services
Distinction between Agency & Lease of Property
Agency Lease of property
Agent is controlled by the Lessee is not controlled
principal. by the lessor. Art. 1869. Agency may be express, or implied
Agency may involve Lease of property from the acts of the principal, from his silence or
things other than involves property. lack of action, or his failure to repudiate the
property. agency, knowing that another person is acting on
Agent can bind the Lessee cannot bind the his behalf without authority.
principal. lessor. Agency may be oral, unless the law requires a
specific form. (1710a)
Distinction between Agency
QuickTime™ toandSell
a
TIFF (Uncompressed) decompressor
& Sale
are needed to see this picture.
Agency to sell Sale
Agent receives the goods Buyer receives the goods Classifications of Agency
as the principal’s goods as owner 1. As to manner of creation
Agent delivers the Buyer pays the price a. Express – agent has been actually
proceeds of the sale authorized by the principal, either
Agent can return the Buyer, as a general rule, orally or in writing
object in case he is cannot return the object b. Implied – agency is implied from the
unable to sell the same sold acts of the principal, from his silence
to a third person or lack of action or his failure to
repudiate the agency knowing that
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Art. 1875. Agency is presumed to be for a Art. 1870. Acceptance by the agent may also be
compensation, unless there is proof to the express, or implied from his acts which carry out
contrary. (n) the agency, or from his silence or inaction
according to the circumstances. (n)
• The agent does not have to prove that the Art. 1871. Between persons who are present, the
agency is for compensation. acceptance of the agency may also be implied if
• But, the prima facie presumption that the the principal delivers his power of attorney to the
agency is for a compensation may be agent and the latter receives it without any
contradicted by contrary evidence objection. (n)
QuickTime™ and a
Broker: Negotiate TIFFcontracts relative to property in
(Uncompressed) decompressor
are needed to see this picture.
Art. 1872. Between persons who are absent, the
behalf of others and for a compensation/fee acceptance of the agency cannot be implied from
the silence of the agent, except:
When Broker Entitled to Compensation: 1. When the principal transmits his power of
• Whenever he brings to his principal a party who attorney to the agent, who receives it
is able and willing to take the property, and without any objection;
enter into a valid contract upon the terms 2. When the principal entrusts to him by
named by the principal, although the particulars letter or telegram a power of attorney with
may be arranged and the matter negotiated and respect to the business in which he is
completed between the principal and the habitually engaged as an agent, and he
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did not reply to the letter or telegram. (n) The power shall continue to be in full force
until the notice is rescinded in the same manner
in which it was given. (n)
Forms of Acceptance by Agent:
1. Express - when it is oral or written
2. Implied -when it can be inferred from the Way of Giving Notice of Agency & Its Effect:
acts of the agent which carry out the agency, 1. By special information - the person
or from his silence of inaction according to appointed as agent is considered such with
the circumstances respect to the person to whom it was given.
a. Between persons who are present
– implied acceptance if the principal 2. By public advertisement - the agent is
delivers his power of attorney to the considered such with regard to any person
agent and the latter receives it
without any objection How do you revoke an agency?
b. Between persons who are absent In the same manner as it was constituted.
– acceptance not deemed implied However, constitution by Special Information may be
from the silence of the agent. revoked by notice in a daily newspaper, provided it
Exceptions: can be proven that 3rd persons in question read the
i. When the principal transmits his revocation
power of attorney to the agent
who receives it without any What is an agency by estoppel?
objection There is really no agency at all, but the alleged
ii. When the principal entrusts to agent seemed to have apparent or ostensible,
him by letter or telegram a power although no real authority to represent another.
of attorney with respect to the
business in which he is habitually Distinction between Agency by Estoppel and
engaged as an agent, and he did Implied Agency
not reply to the letter or telegram Agency by Implied Agency
Estoppel
What is meant by “present”?
Generally, “face to face”, but includes people Existence
conversing directly through technology (ex. over the There is an actual
of actual No agency at all
telephone). agency
agency
Can be invoked
Power of Attorney: Instrument in writing by which only by a 3rd
one person, as principal, appoints another as his Reliance by person who in
agent and confers upon him the authority to perform Such reliance in
3rd persons good faith relied
certain specified acts or kinds of acts on behalf of the not needed, since
on the conduct of
principal; primary purpose is to evidence agent’s the agent is a real
the principal in
authority to third parties within whom the agent deals agent
holding the agent
out as being
Construction of Power of Attorney: authorized
General Rule: Strictly construed and strictly pursued; An agent by
held to grant only those specified powers estoppel has
Exception: when strict construction will destroy none of the rights An agent by
QuickTime™ and a
the very purpose of the power
TIFF (Uncompressed) decompressor Nature of of an agent, implied
are needed to see this picture.
Authority except where the appointment has
principal’s all the rights and
Art. 1873. If a person specially informs another or conduct are such liabilities of an
states by public advertisement that he has given that the agent agent, i.e. has
a power of attorney to a third person, the latter reasonably actual authority to
thereby becomes a duly authorized agent, in the believed that the act on behalf of
former case with respect to the person who principal intended the principal
received the special information, and in the latter him to act as an
case with regard to any person. agent
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instructions
Apparent Duty imposed
authority does upon the third
Art. 1874. When a sale of a piece of land or any
not terminate by party to inquire
interest therein is through an agent, the authority
Termination the mere makes
of the latter shall be in writing; otherwise, the sale
of Authority revocation of his termination of the
shall be void. (n)
authority without relationship as
Art. 1876. An agency is either general or special. notice to the third between the
The former comprises all the business of the party principal and
principal. The latter, one or more specific agent effective as
transactions. (1712) to such third party
unless the agency
Art. 1877. An agency couched in general terms has been
comprises only acts of administration, even if the entrusted for the
principal should state that he withholds no power purpose of
or that the agent may execute such acts as he contracting with
may consider appropriate, or even though the such third party
agency should authorize a general and unlimited
management. (n) Construction Merely advisory Strictly construed
of in nature as they limit the
Principal’s agent’s authority
Will an authority embodied in a letter be Instructions
sufficient?
Yes. (Jimenez v. Rabot, 38 Phil 387 [1918]) Agency Couched in General Terms: Covers only
MERE ACTS OF ADMINISTRATION even if:
Attorney-In-Fact: a. The principal should state that he withholds
• One who is given authority by his principal to no power
do a particular act not of a legal character b. The agent may execute such acts as he may
• The term is, in loose language, used to consider appropriate
include agents of all kinds, but in its strict c. The agency should authorize a general and
sense, it means an agent having a special unlimited management
authority created by a deed.
How are contracts of agency construed?
Distinctions between a General Agent and a • Contracts of agency, as well as general
Special Agent powers of attorney, must be interpreted in
General Agent Special Agent accordance with the language used by the
All acts Specific acts in parties.
Scope of connected with pursuance of • The real intention of the parties is primarily
Authority the business or particular determined from the language used and
employment in instructions or gathered from the whole instrument.
which he is with restrictions • In case of doubt, resort must be had to the
engaged necessarily situation, surroundings ad relations of the
implied from the parties. The intention of the parties must be
act to be done sustained rather than defeated.
Nature of InvolvesQuickTime™ and a
No continuity of • So if the contract be open to constructions,
Service continuity
TIFF of
(Uncompressed) decompressor
are needed to see this picture.
service one of which would uphold the intention while
Authorized service the other would overthrow it, the former is to
May bind his Can not bind his be chosen.
principal by an principal in a
Extent to act within the manner beyond or
Which scope of his outside the
Agent May authority specific acts
Bind the although it may which he is
Principal be contrary to the authorized to Art. 1878. Special powers of attorney are
latter’s special perform necessary in the following cases:
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contributed to deceive a 3rd person in consent or authority of the latter. Contracts entered
good faith; into in the name of another person by one who has
b. Where the limitations upon the power been given no authority or legal representation or
created by the principal could not who has acted beyond his powers are classified as
have been known by the 3rd person; unauthorized contracts and are declared
c. Where the principal has placed in the unenforceable, unless ratified.
hands of the agent instruments
signed by him in blank; Generally, the agency may be oral, unless the law
d. Where the principal has ratified the requires a specific form. A special power of attorney
acts of the agent is necessary for an agent to, as in this case, borrow
2. The latter acts within the scope of his money, unless it is urgent and indispensable for the
authority but in his own name, EXCEPT preservation of the things which are under
when the transaction involves things administration. Since nothing in this case involves
belonging to the principal the preservation of things under administration, a
determination of whether Soriano had the special
authority to borrow money on behalf of respondent is
Jesus M. Gozun v. Jose Teofilo T. Mercado a.k.a.
in order.
‘Don Pepito Mercado,’ G.R. No. 167812 (19
December 2006) In the case at bar, there was not enough evidence
establishing that the loan was made on behalf of Don
Facts: Pepito. Gozun’s testimony, during trial, failed to
In the 1995 elections, Don Pepito vied for the categorically state whether the loan was on behalf of
gubernatorial post in Pampanga. The latter’s wife the respondent or his wife. The receipt signed by
transacted with Gozun, the owner of JMG Publishing Lilian was also in her name alone, without
House, for the printing of campaign paraphernalia. indicating that she was acting on behalf of Don
Don Pepito’s wife had told Gozun that the former has Pepito; she thus bound herself in her personal
already given his approval and that the latter could capacity and not as an agent of the respondent or
already start printing. Gozun thereafter availed of the anyone for that matter.
services of two other publishing houses to be able to
meet the deadline. The printed materials were then As to the issue on whether or not Gozun can collect
delivered to Don Pepito’s headquarters. the cost of the printing due to the other publishing
houses, the Court held that Gozun is the real party in
Meanwhile, Don Pepito’s sister-in-law, Lilian Soriano, interest insofar as the recovery of the cost of
obtained from Gozun a “cash advance” allegedly for campaign materials is concerned. The Court was not
the allowances of poll watchers. Lilian acknowledged persuaded by Don Pepito’s theory that the campaign
on petitioner’s 1995 Diary receipt of the amount materials delivered to him were donations from his
without thereby indicating that she was obataining friends and supporters; if so, such fact should have
such amount on behalf of Don Pepito. been printed on the face of the materials as required
by the Comelec rules.
Gozun sent a Statement of Account for the printing,
including the amount due the other publishing houses
plus the amount of the loan given to Lilia. Don NOTE: The agent is not deemed to have exceeded
Pepito’s wife made a partial payment to Gozun. the limits of his authority should he perform the
Despite repeated demands, respondent failed to agency in a manner more advantageous to the
settle the balance. Hence, a collection case was principal than that indicated by him, since he is
instituted by Gozun. authorized to do such acts as may be conducive to
Issue: Whether or not QuickTime™
Don Pepito should be held the accomplishment of the purpose of the agency.
and a
TIFF (Uncompressed) decompressor
liable for the amount?
are needed to see this picture.
Art. 1884. The agent is bound by his acceptance which he did so, and on those which he still owes
to carry out the agency, and is liable for the after the extinguishment of the agency. (1724a)
damages which, through his non-performance,
the principal may suffer. Art. 1897. The agent who acts as such is not
He must also finish the business already personally liable to the party with whom he
begun on the death of the principal, should delay contracts, unless he expressly binds himself or
entail any danger. (1718) exceeds the limits of his authority without giving
such party sufficient notice of his powers. (1725)
Art. 1885. In case a person declines an agency,
he is bound to observe the diligence of a good
father of a family in the custody and preservation Obligations of the Agent to the Principal
of the goods forwarded to him by the owner until 1. General:
the latter should appoint an agent or take charge a. Act with utmost good faith & loyalty for
of the goods. (n) the furtherance of principal’s interests
b. Obey principal’s instructions
Art. 1886. Should there be a stipulation that the c. Exercise reasonable care
agent shall advance the necessary funds, he shall
be bound to do so except when the principal is 2. Specific:
insolvent. (n) a. Carry out the agency
b. Answer for damages which through his
Art. 1887. In the execution of the agency, the non-performance the principal may suffer
agent shall act in accordance with the c. Finish the business already begun on the
instructions of the principal. death of the principal should delay entail
In default thereof, he shall do all that a good any danger (exception to the rule that
father of a family would do, as required by the death extinguishes agency)
nature of the business. (1719) d. Observe the diligence of a good father in
the custody and preservation of the
Art. 1888. An agent shall not carry out an agency goods forwarded to him by the owner in
if its execution would manifestly result in loss or case he declines an agency, until an
damage to the principal. (n) agent is appointed
e. Advance necessary funds if there be a
Art. 1889. The agent shall be liable for damages if, stipulation to do so (except when the
there being a conflict between his interests and principal is insolvent)
those of the principal, he should prefer his own. f. Act in accordance with the instructions of
(n) the principal, and in default thereof, to do
all that a good father of a family would do
Art. 1890. If the agent has been empowered to Exceptions (to the rule that the agent
borrow money, he may himself be the lender at must not depart from the instructions of
the current rate of interest. If he has been principal):
authorized to lend money at interest, he cannot 1. There’s a sudden emergency
borrow it without the consent of the principal. (n) 2. If the instructions are ambiguous
3. If the departure is so
Art. 1891. Every agent is bound to render an insubstantial that it does not
account of his transactions and to deliver to the affect the result and the principal
principal whatever he may have received by suffers no damage thereby
QuickTime™ and a
virtue of the agency, even
TIFF (Uncompressed) though
decompressor it may not be g. Not to carry out the agency if it would
are needed to see this picture.
owing to the principal. manifestly result in loss or damage to
Every stipulation exempting the agent from the the principal
obligation to render an account shall be void. h. Answer for damages if there being a
(1720a) conflict between his & principal’s
interests, he prefers his own
i. Not to loan to himself if he has been
authorized to loan money at interest
Art. 1896. The agent owes interest on the sums j. Render an account of his transactions
he has applied to his own use from the day on and deliver to the principal whatever he
may have received by virtue of the 3. When an agent by his act prevents
agency (If the agent fails to deliver and performance on the part of the principal
instead converts or appropriates for his 4. When a person acts as an agent without
own use the money or property authority or without a principal
belonging to his principal, he may be 5. A person who purports to act as agents of an
charged with ESTAFA.) incapacitated principal
k. Be responsible in certain cases for the
act of the substitute appointed by him
l. Pay interest on funds he has applied to Art. 1892. The agent may appoint a substitute if
his own use the principal has not prohibited him from doing
so; but he shall be responsible for the acts of the
Distinctions between Authority and the substitute:
Principal’s Instructions 1. When he was not given the power to
Authority Instructions appoint one;
Sum total of the powers Contemplates only a 2. When he was given such power, but
committed to the agent private rule of guidance without designating the person, and the
by the principal to the agent; person appointed was notoriously
independent and distinct incompetent or insolvent.
in character All acts of the substitute appointed against the
Relates to the Refers to the manner or prohibition of the principal shall be void. (1721)
subject/business with mode of agent’s action
which the agent is Art. 1893. In the cases mentioned in Nos. 1 and 2
empowered to deal or act of the preceding article, the principal may
Limitations of authority Without significance as furthermore bring an action against the substitute
are operative as against against those with with respect to the obligations which the latter
those who have/charged neither knowledge nor has contracted under the substitution. (1722a)
with knowledge of them notice of them
Contemplated to be Not expected to be made
made known to third known to those with Appointment of Sub-agent:
persons dealing with the whom the agent deals 1. If the principal has not prohibited the agent from
agent appointing a substitute, he will be liable to 3rd
persons for the acts of the sub-agent within the
When agent has a right to disobey the principal’s scope of his authority
instructions: 2. If there is a prohibition but nevertheless the agent
1. When the instruction calls for the appoints a subagent, all the subagent’s acts are
performance of illegal acts void as to the principal.
2. Where he is privileged to do so to protect his 3. If there is authority to appoint and subagent is not
security in the subject matter of the agency designated by the principal, the agent will be
liable for all the acts of the subagent if the
When obligation to account not applicable: subagent is notoriously incompetent or insolvent.
1. If the agent acted only as a middleman with 4. If there is authority to appoint and subagent is
the task of merely bringing together the designated by the principal, the agent is released
vendor and the vendees. from any liability from the acts of the subagent.
2. If the agent had informed the principal of the 5. If the appointment of a sub-agent is not
gift/bonus/profit he received from the authorized but not prohibited, it shall be valid if it
QuickTime™ and a
purchaserTIFFand his principal
(Uncompressed) decompressor did not object is beneficial to the principal. But, should the
are needed to see this picture.
thereto. principal incur damage due to such appointment,
3. Where a right of lien exists in favor of the the agent shall be primarily responsible for the
agent. acts of the substitute.
simultaneously, is not solidary, if solidarity has or the instructions as regards the agency. Private
not been expressly stipulated. (1723) or secret orders and instructions of the principal
do not prejudice third persons who have relied
Art. 1895. If solidarity has been agreed upon, upon the power of attorney or instructions shown
each of the agents is responsible for the non- them. (n)
fulfillment of agency, and for the fault or
negligence of his fellows agents, except in the Art. 1909. The agent is responsible not only for
latter case when the fellow agents acted beyond fraud, but also for negligence, which shall be
the scope of their authority. (n) judged with more or less rigor by the courts,
according to whether the agency was or was not
for a compensation. (1726)
Responsibility of 2 or More Agents Appointed
Simultaneously:
General Rule: Liable jointly Effect where 3rd person aware of limits of agent’s
Exception: Solidarity has been expressly power: If the agent exceeds his authority, it shall be
stipulated; each of the agents becomes solidarily VOID unless the principal ratifies it.
liable for (1) the non-fulfillment of the agency; of
for (2) the fault or negligence of his fellow agent DOCTRINE OF AGENCY BY NECESSITY: actually,
Exception to the exception: when one of an agency can never be created by necessity; what is
the other agent/s acts beyond the scope of created is additional authority in an agent appointed
his authority – innocent agent is NOT liable and authorized before the emergency arose. The
existence of emergency or other unusual conditions
may operate to invest in an agent authority to meet
Art. 1898. If the agent contracts in the name of the the emergency, provided: (PURE)
principal, exceeding the scope of his authority, 1. The agent’s enlarged authority is exercised
and the principal does not ratify the contract, it for the principal’s protection
shall be void if the party with whom the agent 2. The agent is unable to communicate with
contracted is aware of the limits of the powers principal;
granted by the principal. In this case, however, 3. The means adopted are reasonable under
the agent is liable if he undertook to secure the the circumstances;
principal's ratification. (n) 4. The emergency really exists;
Art. 1899. If a duly authorized agent acts in When 3rd person repudiate the contract
accordance with the orders of the principal, the • Before actual ratification by the principal, or
latter cannot set up the ignorance of the agent as before the principal has signified his willingness
to circumstances whereof he himself was, or to ratify the agent’s acts.
ought to have been, aware. (n)
Effect of the principal receiving the benefits of
Art. 1900. So far as third persons are concerned, the transaction:
an act is deemed to have been performed within • He is deemed to have ratified it. A principal may
the scope of the agent's authority, if such act is not accept the benefits of a transaction and at the
within the terms of the power of attorney, as same time repudiate its burdens
written, even if the agent has in fact exceeded the
limits of his authority according to an Conditions for Ratification
understanding between the principal and the 1. The principal must have capacity and power
QuickTime™ and a
agent. (n) TIFF (Uncompressed) decompressor
are needed to see this picture.
to ratify
2. He must have had knowledge of material
Art. 1901. A third person cannot set up the fact facts
that the agent has exceeded his powers, if the 3. He must ratify the acts in its entirety
principal has ratified, or has signified his 4. The act must be capable of ratification
willingness to ratify the agent's acts. (n) 5. The act must be done in behalf of the
principal
Art. 1902. A third person with whom the agent • To be effective, ratification need not be
wishes to contract on behalf of the principal may communicated or made known to the
require the presentation of the power of attorney, agent or the third party. The act or
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unlawfully deprived
1. Authorized - principal still liable
2. Beyond the scope of the agent’s
With misrepresentations by authority
the agent General Rule: Principal not
liable
Exception: principal takes
advantage of a contract or
receives benefits made under
false representation of his
agent
3. For the agent’s own benefit –
principal still liable; agent’s motive
immaterial
1. Principal still responsible for the
Mismanagement of the acts contracted by the agent
business by the agent with respect to 3rd persons;
2. Principal, however, may seek
recourse from the agent
Principal civilly liable so long as the
Tort committed by the agent tort is committed by the agent while
performing his duties in furtherance
of the principal’s business
Agent in good faith but Principal is liable for damages
prejudices 3rd parties
Agent in bad faith and Only the agent is liable for damages
prejudices 3rd persons
Distinction between Ordinary Agent & Art. 1910. The principal must comply with all the
Commission Agent obligations which the agent may have contracted
Ordinary Agent Commission Agent within the scope of his authority.
Acts for and in behalf of May act in his own name As for any obligation wherein the agent
his principal or in that of the principal has exceeded his power, the principal is not
Need not have Must be in possession of bound except when he ratifies it expressly or
possession of the the thing he disposes tacitly. (1727)
principal’s goods
Has a relation with Maintains no relation with Art. 1913. The principal must also indemnify the
principal, buyer or seller, the thing which he agent for all the damages which the execution of
and property which is the purchases or sells the agency may have caused the latter, without
object of the transaction fault or negligence on his part. (1729)
Obligations of a Commission Agent: Art. 1915. If two or more persons have appointed
an agent for a common transaction or
1. Responsible for the goods received by him, as
undertaking, they shall be solidarily liable to the
described in the consignment, UNLESS upon
agent for all the consequences of the agency.
receiving them he should make a written
(1731)
statement of the damage and deterioration
suffered by the same
Art. 1916. When two persons contract with regard
2. If goods are of the same kind and mark but
to the same thing, one of them with the agent and
belonging to different owners, make a
the other with the principal, and the two contracts
distinction by counter marks and designate the
are incompatible with each other, that of prior
merchandise respectively belonging to each
date shall be preferred, without prejudice to the
principal cannot, without consent of the
provisions of Article 1544. (n)
principal, sell on credit; should he do, principal
may demand payment in cash, but the
Art. 1917. In the case referred to in the preceding
commission agent entitled to any
article, if the agent has acted in good faith, the
interest/benefit which may result from such
principal shall be liable in damages to the third
sale
person whose contract must be rejected. If the
3. If an agent receiving guarantee commission (a
agent acted in bad faith, he alone shall be
del credere agent), bears the risk of collection
responsible. (n)
and pay the principal the proceeds of the sale
on the same terms agreed
QuickTime™ and a upon with the
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purchaser liable for damages
are needed to see this picture. if agent does not
collect the credits of his principal at the time Obligations of the Principal to the Agent:
when they become due and demandable, 1. Comply with all the obligations agent
UNLESS he proves, that he exercised due contracted in representation of the principal
diligence for that purpose. 2. Advance sums necessary for the execution
of the agency, when agent so requests; liable
for reimbursement regardless of the
CHAPTER 3: OBLIGATIONS OF THE PRINCIPAL undertaking’s success whenever agent had
advanced & has no fault; includes interest
3. Reimburse the agent for all advances made
Change of Circumstance:
General Rule: when there is a basic change in the Art. 1926. A general power of attorney is revoked
circumstances surrounding the transaction, which as by a special one granted to another agent, as
not contemplated by the parties and which would regards the special matter involved in the latter.
reasonably lead the agent to believe that the principal (n)
would not desire him to act, the authority of the agent
is terminated Art. 1927. An agency cannot be revoked if a
Exceptions: bilateral contract depends upon it, or if it is the
a. If the original circumstances are restored means of fulfilling an obligation already
within a reasonable period of time, the contracted, or if a partner is appointed manager
agent's authority may be revived of a partnership in the contract of partnership
b. Where the agent has reasonable doubts and his removal from the management is
as to whether the principal would desire unjustifiable. (n)
him to act, his authority will not be
terminated if he acts reasonably Art. 1928. The agent may withdraw from the
c. Where the principal and agent are in agency by giving due notice to the principal. If
close daily contact, the agent's authority the latter should suffer any damage by reason of
to act will not terminate upon a change of the withdrawal, the agent must indemnify him
circumstances if the agent knows the therefor, unless the agent should base his
principal is aware of the change and withdrawal upon the impossibility of continuing
does not give him new instructions the performance of the agency without grave
detriment to himself. (1736a)
Art. 1920. The principal may revoke the agency at Art. 1929. The agent, even if he should withdraw
will, and compel the agent to return the document from the agency for a valid reason, must continue
evidencing the agency. Such revocation may be to act until the principal has had reasonable
express or implied. (1733a) opportunity to take the necessary steps to meet
the situation. (1737a)
Art. 1921. If the agency has been entrusted for the
purpose of contracting with specified persons, its
revocation shall not prejudice the latter if they Revocation: Termination of the agency by the
were not given notice thereof. (1734) subsequent act of the principal
Art. 1922. If the agent had general powers, Renunciation/Withdrawal: Termination of the
revocation of the agency does not prejudice third agency by the subsequent act of the agent
persons who acted in good faith and without
knowledge of the revocation. Notice of the May the agency be extinguished at will?
revocation in a newspaper of general circulation
is a sufficient warning to third persons. (n) A. AGENT may do so but subject to the contractual
obligations owing the principal (i.e. fixed period of
Art. 1923. The appointment of a new agent for the time for the agency or purpose not yet
same business or transaction revokes the accomplished);
previous agency from the day on which notice 1. Expressly or impliedly
thereof was given to the former agent, without a. conducted himself in a manner
prejudice to the provisions of the two preceding incompatible with his duties;
QuickTime™ and a
articles. (1735a) TIFF (Uncompressed) decompressor b. abandons the object of agency and acts
are needed to see this picture.
for himself in committing a fraud upon his
Art. 1924. The agency is revoked if the principal principal;
directly manages the business entrusted to the c. he files a complaint against the principal
agent, dealing directly with third persons. (n) and adopts an antagonistic attitude
towards him
Art. 1925. When two or more principals have with just cause - give due notice
granted a power of attorney for a common without just cause - liable for
transaction, any one of them may revoke the damages if agent suffers
same without the consent of the others. (n) damages thereby UNLESS the