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When the final settlement of accounts was had, both Aragon and the plaintiff, Teofila del Rosario de Costa,
confirmed it as a true statement of the account. The defendant corporation however, refused to pay over to
the plaintiffs the balance of 1,795.25. Thus, plaintiffs brought this action to recover from the defendant
corporation the said sum.
Defendant claims that plaintiffs are just merchants who purchased the goods and were never employed as
agents. Plaintiffs claim that they were the agents of the defendant; "that they received commissions on the
sales made by the agency; and that they were authorized to extend a reasonable credit under the
supervision of the general agent."
TC: Plaintiffs are merchants. The lower court was of the opinion that the specific goods sold to the
delinquent debtors, whose unpaid accounts form the basis of this litigation, had already been paid for by the
plaintiffs and that this was conclusive evidence that the plaintiffs were not acting as the agents of the
defendant corporation, and that in effect, the purpose of this suit was to recover back money already paid for
the goods purchased and sold by the plaintiffs.
Issue: Are the plaintiffs merchants or subagents?
Held: Plaintiffs are subagents for the defendant corporation. Plaintiffs won.
"It is not denied however, that Aragon was acting as the general agent of the defendant corporation and that
as such he was invested with the authority to inaugurate and carry out a selling campaign with a view of
interesting the sale of the defendant's products in the territory assigned to him. The record does not show
what limitations, if any, were placed upon his powers to act for the corporation. x x x It appears further that 25 the head office in Manila was fully informed of plaintiffs' relations with the general agent in extending the
sales of its products. Plaintiffs made direct remittances to the head office in Manila and these remittances
were credited to the account of the agency at Legaspi, and acknowledgment w...
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This document was uploaded on 03/11/2014.
- Fall '14