Conde v.

Court of Appeals
G.R. No. L-40242

digested by: Galut, Jemaima Rose C.

Doctrine:

An implied agency must be held to have been created from their silence or lack
of action, or their failure to repudiate the agency.

Facts:

Margarita Conde, Bernardo Conde and the petitioner Dominga Conde, as

heirs of Santiago Conde, sold with right of repurchase, within ten (10) years, a
parcel of agricultural land located in Leyte, (Lot 840), Casimira Pasagui, married
to Pio Altera (hereinafter referred to as the Alteras), for P165.00.

Private respondent Paciente Cordero, son-in-law of the Alteras, signed a

document in the Visayan dialect, the English translation of which reads:
MEMORANDUM OF REPURCHASE OVER A PARCEL OF LAND SOLD WITH
REPURCHASE WHICH DOCUMENT GOT LOST. To be noted is the fact that neither
of the vendees-a-retro, Pio Altera nor Casimira Pasagui, was a signatory to the
deed. Petitioner maintains that because Pio Altera was very ill at the time,
Paciente Cordero executed the deed of resale for and on behalf of his
father-in-law. Petitioner further states that she redeemed the property with her
own money as her co-heirs were bereft of funds for the purpose.

Pio Altera sold the disputed lot to the spouses Ramon Conde and Catalina T.
Conde. Their relationship to petitioner does not appear from the records. Nor
has the document of sale been exhibited.

Contending that she had validly repurchased the lot in question in 1945,
petitioner filed a Complaint against Paciente Cordero and his wife Nicetas Altera,
Ramon Conde and his wife Catalina T. Conde, and Casimira Pasagui for quieting
of title to real property and declaration of ownership. Petitioner's evidence is
that Paciente Cordero signed the Memorandum of Repurchase in representation
of his father-in-law Pio Altera, who was seriously sick on that occasion, and of his
mother-in-law who was in Manila at the time, and that Cordero received the
repurchase price of P65.00.
 The Court of Appeals held that petitioner had failed to validly exercise her
right of repurchase in view of the fact that the Memorandum of Repurchase was
signed by Paciente Cordero and not by Pio Altera, the vendee-a-retro, and that
there is nothing in said document to show that Cordero was specifically
authorized to act for and on behalf of the vendee a retro, Pio Altera.

Issue:

Whether there was an agency established by Paciente Cordero when he

signed the Memorandum of Repurchase

Ruling:

Yes, although the petitioner had done nothing to formalize her repurchase,
by the same token, neither have the vendees-a-retro done anything to clear their
title of the encumbrance therein regarding petitioner's right to repurchase. No
new agreement was entered into by the parties as stipulated in the deed of pacto
de retro, if the vendors a retro failed to exercise their right of redemption after
ten years. If, as alleged, petitioner exerted no effort to procure the signature of
Pio Altera after he had recovered from his illness, neither did the Alteras
repudiate the deed that their son-in-law had signed. Thus, an implied agency
must be held to have been created from their silence or lack of action, or their
failure to repudiate the agency.
 Albert v. University Publishing Co., Inc.
G.R. No. L-19118

digested by: Galut, Jemaima Rose C.

Doctrine:

A person acting or purporting to act on behalf of a corporation which has no

valid existence assumes such privileges and obligations and becomes personally
liable for contracts entered into or for other acts performed as such agent.

Facts:

On September 24, 1949, Mariano A. Albert sued University Publishing Co.,

Inc. Plaintiff alleged inter alia that defendant was a corporation duly organized
and existing under the laws of the Philippines; that on July 19, 1948, defendant,
through Jose M. Aruego, its President, entered into a contract with plaintifif; that
defendant had thereby agreed to pay plaintiff P30,000.00 for the exclusive right
to publish his revised Commentaries on the Revised Penal Code and for his share
in previous sales of the book's first edition; that defendant had undertaken to
pay in eight quarterly installments of P3,750.00 starting July 15, 1948; that per
contract failure to pay one installment would render the rest due; and that
defendant had failed to pay the second installment.

Defendant admitted plaintiff's allegation of defendant's corporate existence

but alleged that it was plaintiff who breached their contract by failing to deliver
his manuscript. Furthermore, defendant counterclaimed for damages.

When an execution writ was issued against University Publishing Co., Inc., it
was found that University Publishing Co., Inc. was not registered with the SEC.
Albert petitioned for a writ of execution against Jose M. Aruego as the real
defendant.

Issue:

Whether Jose M. Aruego can be held liable

Ruling:

Yes, Aruego represented a non-existent entity and induced not only the
plaintiff but even the court to believe in such representation. He signed the
contract as "President" of "University Publishing Co., Inc.," stating that this was
"a corporation duly organized and existing under the laws of the Philippines,"
and obviously misled plaintiff into believing the same. One who has induced
another to act upon his wilful misrepresentation that a corporation was duly
organized and existing under the law, cannot thereafter set up against his victim
the principle of corporation by estoppel .

In Salvatiera vs. Garlitos, supra, the court ruled: "A person acting or
purporting to act on behalf of a corporation which has no valid existence assumes
such privileges and obligations and becomes personally liable for contracts entered
into or for other acts performed as such agent." Had Jose M. Aruego been named
as party defendant instead of, or together with, "University Publishing Co., Inc.,"
there would be no room for debate as to his personal liability. Since he was not
so named, the matters of "day in court" and "due process" have arisen.

The evidence is patently clear that Jose M. Aruego, acting as representative of

a non-existent principal, was the real party to the contract sued upon; that he
was the one who reaped the benefits resulting from it, so much so that partial
payments of the consideration were made by him; that he violated its terms,
thereby precipitating the suit in question; and that in the litigation he was the
real defendant. Perforce, in line with the ends of justice, responsibility under the
judgment falls on him.