NG YA vs. SUGBU COMMERCIAL CO.

[No. 10318-R. April 23, 1954]

Ng Ya, doing business under the Trade Name SiO Eng Store, plaintiff and appellee, vs. Sugbu Commercial Co.,
defendant and appellant. SuGBU Commercial Co., third-party Jilaintiflf, vs. Pow Sun Gke, third-party defendant.

A manager of a partnership is presumed to have all the incidental powers to carry out the object of the partnership in
the transaction of the business.

There is of course an exception to this general rule, that is, when the powers of a manager are specifically restricted
he could not exercise the powers expressly limited from him. But when the articles of association do not specify the
powers of the manager, it is admitted on principle that a manager has the powers of a general agent, and even more.
When the object of the company is determined, the manager has all the powers for the attainment of such subject

The facts are stated in the opinion of the court:

Ng Ya was a Chinese merchant who owned the Sio Eng Store in Surigao, Surigao, while the Sugbu Commercial
Company was a partnership doing business in Cebu City In the month of December, 1949, Ng Ya ordered from said
company a total of 1,000 galvanized iron and aluminum sheets (Exhibits A & D). It was agreed that the goods were to
be shipped in a week's time, or on or before January 5, 1950.

As Ng Ya failed to receive the goods on this date, she personally inquired about the same from Sugbu Commercial
Company in Cebu City, and Pow Sun Gee, the managing partner, told her that delivery of the goods would be made
by the end of January. Again she failed to receive the goods on that date, and on inquiring about them she was told by
the same manager that the company had not yet received the galvanized iron sheets which might arrive in February
or March. Shih Tiong Chu informed her that he was going to Manila and promised her that he would ship her order
direct to Surigao. On February 28, 1950, Ng Ya again went to Cebu City to verify from the company if the galvanize d
and aluminum sheets had already arrived, bringing with her P4,000 with which she intended to buy cigarettes for resale
in Surigao.

For the third time, she was informed that her order had not yet arrived and that it was to arrive by March. Upon learning
Ng Ya's other purpose in coming to Cebu, Pow Sun Gee informed her that the company had an order for cigarettes
and that as soon as they arrive they would sell the same at a low price provided payment therefor would be deposited.
At the same time she was made to understand that the cigarettes were of "Virginia and "Red Crown" brands which
were not then for sale in Cebu.

Attracted by this proposition, and believing that the delay of the arrival of the galvanized iron and aluminum sheets was
not the company's fault, she yielded to Pow Sun Gee's offer. Thus, she delivered to the company the P4,000 which
she had then with her as deposit ftjar the payment of the cigarettes (Exhibit E), and was promised that delivery of the
cigarettes would be made on July of 1950. The amount of P4,000 was secured by Ng Ya from one Tan Chun Pia,
owner of Lana Bakery in Surigao, with whom, before going to Cebu, she had an understanding of splitting the profits
she hoped to realize from the buy and sell of cigarrettes.

Thus, in making the deposit with the Sugbu Commercial Company, the receipt for the deposit was issued in the name
of Lana Bakery (Exhibit "E"). March came, then July, but neither the galvanized and aluminum sheets nor the cigarettes
reached Ng Ya. Consequently, Tan Chun Pia of Lana Bakery, from whom she obtained the aforesaid amount of P4,000
got angry with her, and, for this reason, Ng Ya was forced to reimburse him of this amount (Exhibits F, "F-1" and "F-
2") and kept going to the Sugbu Commercial Company to alternatively demand either the delivery of the galvanized
iron and aluminum sheets and cigarettes, or the return to her of the total sum of P9,400. Unfortunately everytime she
dropped in there, poor Ng Ya was challenged by Shih Tiong Chu to file a complaint, and she had to seek the help of
the Chinese Chamber of Commerce for her claim with the Sugbu Commercial Company.
As this was fruitless, Ng Ya finally filed a complaint with the Court of First Instance of Cebu against the Sugbu
Commercial Company, praying that

(1) Defendant be ordered to pay to the plaintiif on the first cause of action the sum of P5,400, plus damages amounting
to P500;
(2) Defendant be ordered to pay the plaintiff on the second cause of action &iB sum of P4,000 plus damages amounting
to P400;
(3) Defendant be ordered to pay to the plaintiff on the third cause of action the sum of P1000;
(4) A writ of attachment immediately issue against the property of the defendant, as security for the satisfaction of any
judgment that may be recovered;
(5) Plaintiff be granted such other reliefs as may be just and equitable in the premises.

Answering the complaint, defendant Sugbu Commercial Company made specific denials of the allegations of said
complaint, and by way of counterclaim it alleged that for the unjust and illegal presentation thereof it suffered damages
in the amount of P2,000.

Defendant, therefore, prayed that the complaint filed in this case be dismissed with costs against the plaintiff, and that
she be ordered to pay P2,000 and for any other relief just and equitable. The Sugbu Commercial Company then filed
a third party complaint against Pow Sun Gee, alleging that said company was dissolved on January 19, 1951, by the
agreement of the partners, Pow Sun Gee and Shih Tiong Chu; that it continued to exist only insofar as it was necessary
and for the sole purposes of making a liquidation and settlement of its business; and that Pow Sun Gee assumed the
responsibility of settling the accounts with Ng Ya and also of dropping this case of Ng Ya against the Sugbu Commercial
Company. Thus, third-party plaintiff prayed for judgment

1. Ordering the Third-Party defendant to indemnify the the Party plaintiff for whatever is adjudged against the latter in
favor of the plaintiff
2. Ordering the Third-Party defendant to pay the costs of the proceedings and such other relief which the court may
find just and equitable.

As the motion to dismiss the third-party complaint was denied, the third-party defendant filed his answer after rendition
of another order denying his motion for reconsideration. After due trial, the lower court rendered decision, sentencing
defendant Sugbu Commercial Company to pay plaintiff Ng Ya the sum of P9,400 with legal interest from the filing of
the complaint and to pay the costs, and ordering Pow Sun Gee to reimburse the Sugbu Commercial Company of any
amount paid by the latter by virtue of this judgment. From the aforesaid decision, defendant Sugbu Commercial
Company appealed and now maintains that the lower court erred

1. In failing to consider facts and circumstances of weight and influence, and in not finding that the transactions upon
which plaintiff's claim are based are simulated, fictitious and in fraud of the defendant partnership;
2. In giving full credence to the uncorroborated, inconsistent and improbable testimony of plaintiff Ng Ya relative to the
alleged transactions evidenced by Exhibits A, C, and E;
3. In disregarding upon motion of plaintiff, parol evidence showing the circumstances under which Exhibit "29" was
executed, and in holding that said Exhibit constitutes an admission of defendant's liability to the plaintiff;
4. In not giving weight to the testimony of the bookkeeper relative to the entries in the books of account and in not
considering the significance of said entries; and
5. In rendering judgment against the defendant and in favor of the plaintiff. Whether or not Pow Sun Gee had a bad
reputation among some merchants in Cebu City is of no importance at least insofar as the claim of Ng Ya against the
Sugbu Commercial Company, which had a different and distinct personality from Pow Sun Gee and from which Ng Ya
ordered the galvanized iron and aluminum sheets as well as the cigarettes, is concerned.

Pow Sun Gee receipted the aforementioned amounts of P5,400 and P4,000 in his capacity as manager of the Sugbu
Commercial Company, and it is of no avail that the defendant company in its desire to evade liability to Ng Ya would
gratuitously allege now that its manager, Pow Sun Gee, was not authorized to issue official receipts. Indeed, it would
be quite queer that the manager of any juridical entity would not be authorized to issue receipts for amounts delivered
to that entity through said manager, and that only his co-partner Shih Tiong Chu, who was most of the time in Manila,
could do so. This is not in keeping with present day business dealings, for it is slow and highly inconvenien t to those
who transact business with the company.

As manager, Pow Sun Gee, can be presumed to have all the incidental powers to carry out the object of the partnership
in the transaction of business. Of course we are not unaware of the exception to this general rule, that is, when the
powers of a manager are specifically restricted he could not exercise the powers expressly limited from him. But when
the articles of association do not specify the powers of the manager, it is admitted on principle that a manager has the
power of a general agent, and even more.

When the object of the company, the manager has all the powers necessary for the attainment of such object. (1 Gay
de Montilla, 100; Garcia Ron vs. Compania de Minas, 12 Phil., 130; Smith Bell & Co. vs. Aznar & Co., 40 Off. Gaz.,
1882, quoted in Vol. I, p. 62, 5th Ed., Commercial Laws by Tolentino.) Appellant did not even dare to present the
articles of co-partnership that would show any limitation upon the powders of its manager an indication that there
was none. For this reason, we hold and declare that the minor power of issuing official receipts is included in the
general powers of the manager. Similarly of no moment is the allegation of appellant company that Ng Ya and Pow
Sun Gee are closely related.

If this allegation were true, Pow Sun Gee should have favorably accommodated Ng Ya, contrary what he had done to
this poor Chinese woman. His co-partner Shih Tiong CIiu even played as a second fiddle when he promised Ng Ya
that as he was going to Manila he would see to it that the galvanized and iron sheets would be shipped to her from
Manila to Surigao (p. 10, t. s. n.). Undoubtedly, such promise further made Ng Ya to have faith in the company.
Apparently desperate over what defendant-appellant had unjustly done to innocent Ng Ya, the former caused to be
published in the newspaper "The Eepublie*' the loss of some of its receipts which conveniently included the very
numbers of the receipts issued to Ng Ya in December 1949, and February, 1950 (Exhibits "16", "16-A" to "16-C), and
after the publication, defendant filed its answer on January 24, 1951.

Appellant's strategy is quite obvious and we can easily glean the predatory purpose that motivated said publication. If
those receipts were really lost, such fact should have been published long time before, and not after summons was
served upon defendant-company. Certainly, such predatory move is frowned upon by professional and business ethics
and should have been considered from a higher perspective before adopting it in a litigation like this. For defendant-
appellant to allege that invoices Nos. 0554 and 0555 (Exhibits "B" & "D") did not contain the notations "to be shipped
on or before January 5, 1950" when they were entered in the books, is preposterous. Referring to the original and
duplicate copies of these invoices (Exhibits "B, D, 1 and X-4"), we have readily noted the phrase "to be shipped on or
before January 5, 1950" written below the notations:

"Above Merchandise deposited in Bodega and Insured." Further examinng these invoices, both originals and
duplicates, we failed to note that the phrases quoted above were added of late on such duplicates which were always
in the possession of appellant company. In another desperate move, appellant alleges that the transaction entered into
by Pow Sun Gee in behalf of Sugbu Commercial Company with Ng Ya was kept secret from Pow Sun Giao who,
according to him, was assigned by ShSii Tiong Chu as supervisor in the store. Admitting for a moment that the manager
Pow Sun Gee kept the transaction a secret from Pow Sun Giao that could not prejudice Ng Ya, and shall not be
forgotten that Pow Sun Gee was the manager-employer of Pow Sun Giao.

Would the latter pretend that he was the super-manager' on top of his employer? Queer and funny. At any rate if he
wanted to supervise the manager, he should have looked into the books of the company to verify what transactions
were entered into by manager Pow Sun Gee and kept secret. We would rather blame Pow Sun Giao than believe him,
for all we know he was a mere salesman in the Sugbu Commercial Company. The trial court had carefully considered
Ng Ya's frank, straight-forward and sincere testimony which perfectly dovetails the exhibits she had presented. There
is no circumstance of weight and influence that was overlooked, and we do not feel justified in disturbing this particular
finding, considering that the determination of the credibility of witnesses properly falls within the province of trial courts.

The lower court correctly ordered the striking out of that portion of Shih Tiong Chu's testimony where he attempted to
show that he agreed not too willingly in recognizing in the dissolution agreement (Exhibit "29") the company's
indebtedness to Ng Ya. The motion to strike out was not based upon the parol evidence rule, as wrongly contended
by appellant, but under section 7 of Rule 123 of the Rules of Court. "Facts alleged in. the complaint are deemed
admissions of the plaintiff and binding upon him. Facts alleged in the answer are deemed admissions of the defendant
and binding upon him. * * *.

Facts stated in a motion are deemed admissions of the movant and binding upon him." (Ill Moran's Comments on the
Rules of Court, 1952 Ed., p. 64.) Appellant may, however, claim in this connection that the foregoing rule is not
applicable in this case, for its allegation that the terms in the dissolution agreement embodied the true and genuine
intention of the parties was not made in the answer to the complaint, but in the answer to the counterclaim of the third-
party defendant. But the Supreme Court in the case of Magdalena Estate Corporation vs. Nytick, 40 Off. Gaz., No. 21,
Supp. 13, p. 141, held

"A party cannot in the course of a litigation or in dealings in pais, be permitted to repudiate his representations or
occupy inconsistent positions, or in the letter of the Scotch Law, 'to a probate and reprobate.'" Anent the fourth
assignment of error, suffice it to say that the determination of the credibility of witnesses properly falls within the sphere
of trial courts and, for this reason, if the court below did not give weight to the testimony of witness Honorio Gonzales,
it was because in considering the same it was not worth believing.

Wherefore, and no reversible error having been committed by the trial court, the appealed judgment is hereby affirmed,
with triple costs against defendant-appellant. It is so ordered.

Felix and Rodas, JJ., concur.

Judgment affirmed with triple costs against defendant- appellant.