K.D.

COMMENT
Relationship between TIEZA and NCFI: PRINCIPLE-AGENT
With TIEZAs intention to preserve Balay Negrense by renovating the existing structure and
maintaining its status as a museum pursuant to the initial contract between TIEZA and
Gaston in relation to the conditions set upon the deed of donation, TIEZA as a principle
party extended intentions to be facilitated by appointing as NCIF through a tripartite
contract as an Agent, to act on behalf of TIEZAs intentions.
Article 1868 of the Civil Code defines the contract of agency as one whereby 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.
In Orient Air Service & Hotel Representatives v. Court of Appeals, 197 SCRA 645 (1991), th e Court held
that the purpose of every contract of agency is the ability, by legal fiction, to extend the
personality of the principal through the facility of the agent; but the same can only be
effected with the consent of the principal.
In Litonjua, Jr. v. Eternit Corp., 490 SCRA 204 (2006), the Court held that It bears stressing that in an
agent-principal relationship, the personality of the principal is extended through the facility of the
agent. In so doing, the agent, by legal fiction, becomes the principal, authorized to perform all acts
which the latter would have him do. Such a relationship can only be effected with the consent
of the principal, which must not, in any way, be compelled by law or by any court.[2] (at p. 223)
In Rallos v. Felix Go Chan & Sons Realty Corp., 81 SCRA 251 (1978), the Court held that the following
are the essential elements of the contract of agency:
(a) Consent, express or implied, of the parties to establish the relationship;
(b) Object, which is the execution of a juridical act in relation to third parties;
(c) Agent acts as a representative and not for himself; and
(d) Agent acts within the scope of his authority

Standing to sue
*** in response to the affirmative defense submitted by NCIF (no.9), regarding the

lack of capability of TIEZA to institute a cause of action: the true intent of the
tripartite contract between TIEZA and NCIF is to establish a relationship of agency
wherein TIEZA as the Principle party to the relationship relays its intention and
purpose to operate, administer, and maintain Balay Negrense to NCIF who herein
shall serve as Agent to the intentions and authority provided for by TIEZA. As
stated in article 1920 of the civil code, the contract of agency may be revoked at
anytime by the principle at will, regardless of cause and reason. The final notice
to vacate sent to ms. Gamboa herein implies such intention of revocation by
means of directing NCIF to relinquish possession of the property which is the
stated subject matter of the contract of agency.

With regard to compensation for expenses prayed for by NCIF

*** In response to the counterclaim submitted by the defense to be compensated for
expenses to restore, maintain and administer the Balay Negrense, we find this without
standing. According to article 1918 of the new civil code:
Art. 1918. The principal is not liable for the expenses incurred by the agent in the following
cases:
XXX
(4) When it was stipulated that the expenses would be borne by the agent, or that
the latter would be allowed only a certain sum. (n)
As stipulated in the memorandum of agreement Article 2, B.3. That the Foundation will
appropriate adequate funds for the continuous operation, administration, and sufficient
maintenance of the project. In this connection, the Foundation shall appoint an
administrator who shall be directly responsible for the project and provide a full
complement of manpower necessary and required thereat

Service of notice to vacate

RULE 70 Forcible Entry and Unlawful Detainer
Section 2. Lessor to proceed against lessee only after demand. Unless otherwise stipulated, such
action by the lesser shall be commenced only after demand to pay or comply with the conditions of the
lease and to vacate is made upon the lessee, or by serving written notice of such demand upon
the person found on the premises if no person be found thereon, and the lessee fails to comply
therewith after fifteen (15) days in the case of land or five (5) days in the case of buildings. (2a)
***in response to the affirmative defense submitted by NCIF (no.8), the jurisdictional
requirement was duly satisfied by the service of the letter of final notice of demand to
vacate, which was received by an employee within the premises.

Unlawful Detainer
In Cabrera v. Getaruela, the Court held that a complaint sufficiently alleges a cause of
action for unlawful detainer if it recites the following:
(1) initially, possession of property by the defendant was by contract with or
by tolerance of the plaintiff;
(2) eventually, such possession became illegal upon notice by plaintiff to
defendant of the termination of the latters right of possession;

(3) thereafter, the defendant remained in possession of the property and

deprived the plaintiff of the enjoyment thereof; and
(4) within one year from the last demand on defendant to vacate the property,
the plaintiff instituted the complaint for ejectment (Ruben C. Copuz, rep. by
Atty.-in-fact Wenifreda C. Agullana Vs. Sps. Hilarion Agustin and Justa
Agustin)

A suit against an agent in his personal capacity cannot, without compelling reasons, be
considered a suit against the principal. Philippine National Bank v. Ritratto Groups, Inc.,
362 SCRA 216 (2001).
*** Just in case we are held accountable for the actions of NCIF.