AGENCY 2.

Agent-he who acts for and represents the

principal and from whom he derives his
ARTICLE 1868
authority.
In this chapter, we will now be discussing Agency,
Act that may be delegated:
including its nature, form and kinds.
1. Acts which are personal in nature.
Characteristics:
2. Acts that are prohibited by law to be delegated.
1. Consensual-because it is perfected by mere
Examples:
consent.
2. Principal-it can stand by itself 1. The right of a stockholder to vote during
3. Nominate-has its own name stockholders’ meetings may be delegated since
4. Unilateral-if it is gratuitous or creating this is something that one can lawfully do.
obligation for only one of the parties (e.g. However, a director cannot be represented by
agent) proxy during board meetings because this is
5. Bilateral-if it is for compensation since it gives prohibited by law.
reciprocal right and obligations. 2. The right to vote and to run for public office
6. Preparatory-it is a means by which other cannot be delegated since delegation thereof is
contracts may be entered into. prohibited by law.

Essential Elements: b. Criminal Acts: An alien cannot purchase land in

the Philippines because this is prohibited by the
1. Consent-can be express or implied
Constitution. Accordingly, he cannot delegate such
We will discuss more about what is express or implied in act to Filipino. What an alien cannot lawfully do, he
the forms of agency. may not lawfully do it to another.

2. Object-execution of a juridical act in relation to Nature of Relations:

third person
1. The relation of an agent to his principal is
3. Agent acts as a rep. and not for himself.
fiduciary since it is based on trust and
4. Agent acts within the scope of his authority.
confidence. Fiduciary means involving trust,
Note: In addition, the parties must be competent under with regard to the relationship between a
the law to act as principal and agent. trustee and a beneficiary.
2. This rule seeks to remove the temptation that
Nature: might arise out
1. Agency as a contract, here are the following 3. An agent cannot serve 2 masters, unless both of
requisites them has given him a consent, or unless he is
2. The agent must render a service “in mere middleman like a real estate broker.
representation or on behalf of another. 4. Confidential information must not be disclosed
to acquire good faith and loyalty
Purpose of agency:
Agency distinguished from similar contracts:
To extend personality of the principal through the acts
of an agent. 1. An agent may be given funds by the principal to
advance ethe latter’s business, while a borrower
Parties: is given money for purposes of his own, and he
1. Principal-The person represented by the agent is required to return it even if his business is
and from whom the latter derives his authority; successful or not.
he is the party primarily and originally 2. In agency, the basis is representation while in
concerned in the contract of agency. lease of service, it is employment.
3. In agency, the agent is subject to the control
and direction of the principal whom he
 represents. While in a contract for a piece of Acceptance by the agent may be express or made orally
work, the independent contractor exercises his or in writing.
employment independently, and not in
Or the agent may be implied from his acts which carry
representation of the employer.
out agency or his silence or inaction according to the
4. Agent acts only for principal while partner acts
circumstances.
not only for his co-partners and the partnership
but also as principal of himself. Article 1871
5. In agency, the representation is expressly
conferred, while in negotiorium gestio, it is not There is implied acceptance if the principal delivers his
only without the authority of the owner of the power of attorney to the agent and the latter accepts it
business but is without his knowledge. without any objection. (This is under cases when there
6. A commission agent is one engaged in the is implied acceptance between two persons who are
purchase or sale of personal property while the present or they are face to face.
broker, has no relation with the thing he buys or Article 1872
sells.
7. An agency to sell is different from sale and we This is still under cases when there is implied
have already discussed this in article 1466. acceptance but this time, it is between two persons
who are absent. However, Article 1872 states that
Kinds of Agency acceptance by the agent can be implied from the silence
1. Express-can be oral agreement or written of the agent in the following cases:
agreement  When the principal transmits his power of attorney
2. Implied-an agency may be implied from the to the agent, who receives it without objection;
following:  When the principal entrusts to him by letter or
a. Acts of the principal telegram a power of attorney with respect to the
b. Silence of the principal business in which he is habitually engaged as an
c. Lack of action of the principal agent, and he did not reply to the letter or
d. Failure of the principal to repudiate the telegram.
agency knowing that another person is
acting in his behalf without his Article 1873
authority. 1. Special information-this is usually made through
3. Gratuitous-the agent receives no compensation a letter addressed to a specific person or
4. Compensation or onerous-the agent receives persons. The person appointed will be
compensation considered a duly authorized agent with respect
5. General-comprises all the business of the to the person who received the special
principal information.
6. Specific-comprises one or more specific 2. Public advertisement-this may be made by
transactions publication in the newspapers, signs, leaflets,
7. Couched in general term-general power of posters, or billboards. The person appointed will
attorney. This comprises only acts of be considered as agent with regard to any
administration person.
8. Couched in specific form-authorizing only the
performance of a specific act or acts Announcement of the revocation of appointment of an
9. Ostensible-agents represents the name of the agent:
principal
1. Special information-the announcement of the
10. Simple-agent acts for the account of the
revocation must also be made by special
principal but in his own name
information.
Article 1870 2. Public advertisement-announcement of
revocation must also be public advertisement.
3.