Tuazon v RamosG.R. No. 156262July 14, 2005Panganiban, J.

FACTS: 1.) The case (petition for review challenging CA’s decision) involves the collection of a sum of money which arose from the failure of petitioners to pay respondents predecessor-in-interest as proven by the non-encashment of checks issued by a third person but indorsed by petitioner Maria Tuazon in favor of said predecessor. * the check drawer need not be impleaded in the complaint so the suit is directed against the debtor who indorsed the checks in payment of the obligation2.) RTC (Nueva Ecija): judgment was rendered in favor of the plaintiffs ordering defendants spouses Leonilo Tuazon and Maria Tuazon to pay the plaintiffs- (a) P1,750, 050. 00 with interests from the filing of the second amended complaint; (b) P50, 000.00 as attorney’s fees; (c) P20,000 as moral damages; (d) cost of suit3.) From May 2, 1988 to June 5, 1998, spouses Tuazon purchased 8.326 cavans of rice from deceased Bartolome Ramos (predecessor-in-interest of respondents); only 4,437 cavans have been paid leaving 3, 889 cavans valued at P1, 211, 919. 00 in debt. Spouses Tuazon issued several Traders Royal Bank checks as payment.4.) The checks all bounced due to insufficiency of funds. Respondents advanced that spouses Tuazon knew that they had no available funds to support the check and failed to provide payment despite repeated demands.5.) Respondents averred that spouses Tuazon conspired with the other defendants to defraud them as creditors by executing fictitious sales of their properties ( 3 lots in favor of spouses Buenaventura, their residential house and lot, Stake Toyota) Co-petitioner Melecio Tuazon, son of spouses Tuazon, registered a fictitious deed of sale over a residential lot and another simulated sale of a Toyota Willys was executed in favor of their other son, co-petitioner Alejandro Tuazon. [No more property was left registered in the names of spouses]6.) Defendants denied purchase of rice from Ramos. They alleged that Magdalena Ramos (wife of deceased Bartolome) who owned and traded merchandise and Maria Tuazon was merely her agent. They argued that it was Evangeline Santos who was the buyer of the rice and issued the checks to Maria Tuazon as payments. The checks were received in good faith from Evangeline and turned over to Ramos without knowing that these were not funded. 6.) They also refuted that the sales made were made for value and in good faith as they were really meeting financial difficulties and done before filing of the instant suit7.) As to them being the buyers of the rice, they argued that there was no sales invoice, O.R., or any other evidence8.) They assert that they were merely agents.9.) Civil and criminal cases previously filed by respondents against Spouses Tuazon is now consolidated and amended to include Spouses Anastacio and Mary Buenaventura with Alejandro and Melecio Tuazon. Having passed away, Bartolome is now substituted by his heirs, herein respondents. Petitioners contend that Evangeline Santos was an indispensable party in the case but the

RTC denied their motion to file a third-party complaint against her despite the fact that the checks had been drawn in her name.10.) The trial court acquitted the petitioners in all three criminal cases so petitioners appealed only its decision finding them civilly liable to respondents11.) CA: held that petitioners failed to prove the existence of an agency between respondents and Spouses Tuazon. Also, there was no need to implead Santos because all the checks had been indorsed by Maria Tuazon.

ISSUE: 1.) WON petitioners are agents of the respondents2.) WON Santos should have been included in the suit as she is an indispensable party

HELD: 1.) No, petitioners were the rice buyers themselves. They were not agents of respondents in their rice dealership.2.) No, she is not an indispensable party as she is just a drawer (NIL) – there

RATIO: AGENCY: -In a contract of agency, one binds oneself to render some service or to do something in representation or on behalf of another, with the latter’s consent or authority- Elements of agency: (1) the parties consent, express or implied, to establish the relationship; (2) object, which is the execution of a juridical act in relation to a third person; (3) the representation, by which the one acts as an agent and not for oneself but as a representative; (4) the limitation that the agent acts within the scope of his or her authority.- There must be mutual intent (actual intention to appoint by the principal which is inferable from his words or actions and intention on the part of the agent to accept the appointment and act upon it)- The question of whether a contract is one of sale or of agency depends on the intention of the parties- Declaration of agents alone are generally insufficient- There is no presumption of agency; proving its existence, nature, and extent is incumbent upon the person alleging it- Petitioners should have brought the suit against Santos for and on behalf of their alleged principal, in accordance with Sec. 2 of Rule 3 of the Rules on Civil Procedure. Their filing a suit against her in their own names negates their claim that they acted as mere agents in selling the rice obtained from Bartolome

INDISPENSABLE PARTY: -respondent’s cause of action is clearly founded on petitioners failure to pay the purchase price, and petitioner Tuazon indorsed the questioned checks in favor of respondents. Santos was the drawer of checks is thus immaterial to the cause of action- upon presentment, indorser warrants that the checks were to be accepted and/or paid according to their tenor, and in case they were dishonored, she would pay corresponding amount- indispensable parties: parties in interest without whom no final determination can be made

Bordador v LuzG.R. No. 130148December 15, 1997Regalado, J.

FACTS: 1.) This is an appeal by certiorari wherein petitioners assail the judgment of the CA which affirmed the adjudication of the RTC-Bulacan which found private respondent Narciso Deganos liable to petitioners for actual damages, but absolved respondent spouses Brigida Luz and Ernesto Luz of liability2.) Petitioners were engaged in the business of purchase and sale of jewelry and respondent Brigida Luz (aka Aida Luz) was their regular customer. On several occasions, respondent Deganos, brother of Aida Luz, received several pieces of gold and jewelry from petitioners amounting to P382, 816.00 [covered in seventeen receipts; 11 of the receipts stated that they were received for a certain Evelyn Aquino, niece of Deganos, and the remaining 6 indicated that they were received for Luz]3.) Deganos was supposed to sell the items at a profit and remit proceeds and return unsold items to petitioners, but only remitted P53, 207.00. He neither paid the balance of the sales proceeds, nor return any unsold item to petitioners. By January 1990, the total of his unpaid account plus interest reached P725, 463.98. Petitioners eventually filed a complaint in the barangay against Deganos4.) In the barangay proceedings, Luz (not impleaded in the case) appeared as a witness for Deganos and signed a compromise agreement with her husband and petitioners. In this compromise agreement, Deganos obligated himself to pay petitioners on installment basis. However, he failed to do so.5.) On June 25, 1990, petitioners instituted a civil case in the RTC for recovery of a sum of money and damages against Deganos and Brigida Luz. Ernesto Luz was impleaded as the spouse of Brigida.6.) Four years later, Deganos and Brigida Luz were charged with estafa in the RTC and that criminal case appears to be still pending in said trial court.7.) In the civil case, petitioners claimed that Deganos acted as the agent of Brigida Luz when he received the subject items of jewelry and, because he failed to pay for the same, Brigida, as principal, and her spouse are solidarily liable with him therefore.8.) While Deganos admitted that he had an unpaid obligation, he claimed that it was only in the sum of P382, 816 [original amount w/o interest] He further asserted that it was he alone who was involved in the transaction with the petitioners and he was not an agent of Brigida Luz, except for the 6 receipts. Moreover, that he did not deliver any item from the petitioners to Brigida9.) Brigida, on her part, denied that she had anything to do with the transactions between petitioners and Deganos; that she never authorized Deganos to receive any item in her behalf10.) RTC: -only Deganos was liable because while Brigida did have transactions with petitioners in the past, the items were already paid for and all that she owed was P21, 483.00 representing interest on the principal account which she had previously paid for- it was petitioner Lydia Bordador who indicated in the receipts that the items were received by Deganos for Aquino and Luz.

-said court was persuaded that Luz was behind Deganos but because there was no memorandum (or any written document), the agreement between petitioners and Luz was unenforceable under the Statute of Frauds11.) Deganos was ordered to pay P725, 463.98 plus legal interest from June 25, 1990 and attorney’s fees while Luz was ordered to pay P21, 483 representing the interest on her own personal loan only12.) CA affirmed said judgment

ISSUE: WON respondent spouses are liable to the petitioners for the latters claim for money and damages in the sum of P725, 463.98 plus interests and attorneys fees despite the fact that the evidence does not show that they signed any of the subject receipts or authorized Deganos to receive the items of jewelry on their behalf

HELD: NO, there was no such contract between Luz and Deganos, executed or partially executed and no delivery of any of the items subject of this case was ever mad. Petitioners who were grossly and inexcusably negligent in their transactions with Deganos cannot seek relief from the effects of their negligence by conjuring a supposed agency relation between two respondents without evidence

RATIO: - petitioners said: Brigida Luz sent several letters acknowledging her obligation to petitioners and requested more time to fulfill the same. She also testified in the trial court that Deganos took some gold articles from petitoners and delivered the same to her ~ But, the courts found that the letters concerned previous obligations; the testimony also did not, for a fact, refer to the items in this case- petitioners insist that Deganos was her agent because he held him out to the public as such. Hence, she cannot deny said authority to innocent third parties who dealt with Deganos under such belief. (CA recognized such agency)- SC: no evidence support that Deganos was an agent of Luz and that the latter should consequently be held solidarilly liable with Deganos in his obligation to petitioners- Even if Deganos acted as an agent of Luz, the latter never authorized him to act on her behalf with regard to the transactions subject of this case- CC Art. 1868. By the contract of agency a person binds himself to render some service or to do something in representation or on behalf of another, with the consent or authority of the latter.- Basis for agency is representation. There was no showing that Luz consented to the acts of Deganos or authorized him to act on her behalf with respect to the transactions involved.- It was grossly and inexcusably negligent of petitioners to entrust to Deganos (not once or twice but on 6 occasions) several pieces of jewelry of substantial value without requiring a written authorization from his principal- neither an express nor implied agency was proven to have existed between Deganos and Brigida D. Luz

Orent Air Services & Hotel Representatives v. CA and Amerocan Airlines Inc.G.R. No. 76931May 29, 1991Padilla, J.

FACTS: