FACTS:
Florencia Baluyot offered Atty. Pedro L. Linsangan
a lot called Garden State at the Holy Cross Memorial Park owned by petitioner
(MMPCI). According to Baluyot, a former owner of a memorial lot under Contract
No. 25012 was no longer interested in acquiring the lot and had opted to sell
his rights subject to reimbursement of the amounts he already paid. The
contract was for P95,000.00. Baluyot reassured Atty. Linsangan that once
reimbursement is made to the former buyer, the contract would be transferred to
him.
Atty. Linsangan agreed and gave Baluyot P35,295.00 representing the amount
to be reimbursed to the original buyer and to complete the down payment to
MMPCI. Baluyot issued handwritten and typewritten receipts for these
payments. Contract No. 28660 has a listed price of P132,250.00. Atty. Linsangan
objected to the new contract price, as the same was not the amount previously
agreed upon. To convince Atty. Linsangan, Baluyot executed a document confirming
that while the contract price is P132,250.00, Atty. Linsangan would pay only
the original price of P95,000.00.
Later on, Baluyot verbally advised Atty. Linsangan
that Contract No. 28660 was cancelled for reasons the latter could not explain.
For the alleged failure of MMPCI and Baluyot to conform to their agreement,
Atty. Linsangan filed a Complaint for Breach of Contract and Damages against
the former.
MMPCI alleged that Contract No. 28660 was cancelled
conformably with the terms of the contract because of non-payment of
arrearages. MMPCI stated that Baluyot was not an agent but an independent
contractor, and as such was not authorized to represent MMPCI or to use its
name except as to the extent expressly stated in the Agency Manager Agreement.
Moreover, MMPCI was not aware of the arrangements entered into by Atty.
Linsangan and Baluyot, as it in fact received a down payment and monthly
installments as indicated in the contract.
The trial court held MMPCI and Baluyot jointly and
severally liable. The Court of Appeals affirmed the decision of the trial
court.
ISSUES:
1. Whether or not there was a contract of agency between
Baluyot and MMPCI?
2. Whether or not MMPCI should be liable for Baluyot’s
act?
HELD:
First Issue. Yes. By the contract of agency, a person binds himself to render some
service or to do something in representation or on behalf of another, with the
consent or authority of the latter. As properly found both by the trial court
and the Court of Appeals, Baluyot was authorized to solicit and remit to MMPCI
offers to purchase interment spaces obtained on forms provided by MMPCI. The
terms of the offer to purchase, therefore, are contained in such forms and,
when signed by the buyer and an authorized officer of MMPCI, becomes binding on
both parties.
Second Issue. No. While there is no more question as to the agency relationship
between Baluyot and MMPCI, there is no indication that MMPCI let the public, or
specifically, Atty. Linsangan to believe that Baluyot had the authority to
alter the standard contracts of the company. Neither is there any showing that
prior to signing Contract No. 28660, MMPCI had any knowledge of Baluyot's
commitment to Atty. Linsangan. Even assuming that Atty. Linsangan was misled by
MMPCI's actuations, he still cannot invoke the principle of estoppel, as he was
clearly negligent in his dealings with Baluyot, and could have easily determined,
had he only been cautious and prudent, whether said agent was clothed with the
authority to change the terms of the principal's written contract.
To repeat, the acts of the agent beyond the scope
of his authority do not bind the principal unless the latter ratifies the same.
It also bears emphasis that when the third person knows that the agent was
acting beyond his power or authority, the principal cannot be held liable for
the acts of the agent. If the said third person was 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.
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