AgencyDPFebruary32014

For all the foregoing reasons the appealed judgment

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Unformatted text preview: agent to obtain a loan, securing it with their real property, were quoted at the beginning. The terms thereof are limited; the agent was thereby authorized only to borrow any amount of money which he deemed necessary. There is nothing, however, to indicate that the defendants had likewise authorized him to convert the money obtained by him to his personal use. With respect to a power of attorney of special character, it cannot be interpreted as also authorizing the agent to dispose of the money as he pleased, particularly when it does not appear that such was the intention of the principals, and in applying part of the funds to pay his personal obligations, he exceeded his authority. In this case, it should be understood that the agent was obliged to turn over the money to the principals or, at least, place it at their disposal. The plaintiff contends that the agent's act of employing part of the loan to pay his personal debts was ratified by the defendants in their letter to him dated August 21, 1927. This court has carefully read the contents of said document and has found nothing implying ratification or approval of the agent's act. In it the defendants confined themselves to stating that they would notify their agent of the maturity of the obligation contracted by him. They said nothing about whether or not their agent was authorized to use the funds obtained by him in the payment of his personal obligations. The plaintiff insists that the defendants should answer for the entire loan plus the stipulated interest thereon. This court has already stated the manner in which the agent employed the loan, according to the plaintiff. Of the loan of P28,000, the agent applied the sum of P10,188.29 to the payment of his personal debt to the plaintiff. The balance of P17,811.71 constitutes the capital which the defendants are obliged to pay by virtue of the power conferred upon their agent and the mortgage deed. In connection with the stipulated interest, it appears that the capital of P17,811.71 bore interest at 12 per cent per annum from March 27, 1926, to September 30, 1936, equivalent to P22,460.56. All the interest paid by the defendants to the plaintif...
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