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This is not a technical or arbitrary rule but a rule

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Unformatted text preview: lf, result also in the order rule that all profits made and advantage gained by the agent in the execution of the agency belong to the principal. The mere fact that the agent, by some means or other, by stating facts or refusing to state all of the facts, induces the principal to accept a certain amount as the profits made in the course of the agency, this fact can not be used for the purpose of preventing the principal from recovering the true amount when the true amount is actually discovered. Every agent is bound to give an account of his transaction and to pay to the principal all that he may have received by virtue of the agency, even though what has been received is not owed to the principal. Domingo v. Domingo, GR L­30573 42 SCRA 131 (1971) SUPAPO (This case was already discussed under Article 1868 page 3 of the course outline specifically on topic distinguishing the agency contract from other contracts.) Doctrines: 1. Obligations of an agent; Articles 1891 and 1909 of the CC demand the utmost good faith, fidelity, honesty, candor and fairness on the part of the agent to his principal. 2. Failure of agent to make full disclosure makes him guilty of breach of his loyalty to the principal. 3. Duty and Fidelity when not applicable; The duty embodied in Article 1891 of the CC does not apply if the agent or broker acted only as a middleman with the task of merely bringing together the vendor and vendee, who themselves thereafter will negotiate on the terms and conditions of the transaction. Facts: (Principal: Vicente­petitioner; Agent: Gregorio­respondent) Vicente M. Domingo (petitioner) granted Gregorio Domingo (respondent), a real estate broker, the exclusive agency to sell his lot at P2.00/sqm. As such, Gregorio will receive 5% commission (based on total price). Thereafter, Teofilo Purisima introduced Oscar de Leon to Gregorio as a prospective buyer. Oscar offered to buy the lot at a lower price. Vicente directed Gregorio to tell Oscar de Leon to raise his offer. Gregorio and Oscar had a deal to persuade Vicente to sell his lot at P1.20. They succeeded. As such, Oscar gave Gregorio P1,000.00 as a propina or gift. Gregorio did not disclosed this to Vicente. Also, Gregorio received P300 from Vicente. However, the transaction proceeded excluding Gregorio. Gregorio did not receive his full commission. Vicente argued that he sold his property to Amparo (Osc...
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