AgencyDPFebruary32014

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Unformatted text preview: his principal is not liable for his acts. It is noted that Mauro A. Garrucho was not authorized to execute promissory notes even in the name of his principal Paz Agudelo y Gonzaga, nor to constitute a mortgage on her real properties to secure such promissory notes. The plaintiff Philippine National Bank should know this inasmuch as it is in duty bound to ascertain the extent of the agent's authority before dealing with him. Therefore, Mauro A. Garrucho and not Paz Agudelo y Gonzaga is personally liable for the amount of the promissory note. National Power v. NAMERCO, 117 SCRA 789 (1982) CAMERINO DOCTRINE: An agent who exceeds the limit of his authority is personally liable FACTS:National Power Corporation and National Marketing Corporation, as representative of International Commodities Corporation of New York, executed in Manila a contract for the purchase by the NPC from ICC 4,000 long tons of sulfur. It was stipulated that the seller would deliver the sulfur in Iligan City within 60 days from notice of the establishment of letter of credit and that failure to effect delivery would subject the seller and its surety to the payment of liquidated damages. In entering into the contract, NAMERCO did not disclose to NPC that ICC, in a cable instruction, stated that the sale was subject to the availability of a streamer. Contrary to this, NAMERCO agreed that non­availability of a streamer was not a justification for non­payment of liquidated damages. ICC was unable to deliver the sulfur due to its inability to secure shipping space. Consequently, Government Corporate Counsel rescinded the contract due to the non­performance. NPC sued for recovery of the stipulated liquidated damages. SC dismisses case against ICC for lack of jurisdiction. ISSUES: WON NAMARCO is absolved from liability for being a mere agent of ICC. HELD: NO, NAMARCO is not absolved for acting beyond his powers thus, making him personally liable. The contention of NAMARCO that every person dealing with an agent is put upon inquiry and must discover upon his peril the authority of the agent would be would apply in this case IF the principal is sought to be held liable on the contact entered into by the agent. However, in this case, it is the agent who is sought to be liable on a contract of sale, which was expressly repudiated by the principal because the agent exceeded his authority. In addition, the unenforceability of a contract entered into by an agent beyond his power is applicable onl...
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This document was uploaded on 03/11/2014.

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