1. RALLOS V YANGCO

FACTS:* Yangco sent Rallos a letter inviting the latter to be the consignor in buying and selling leaf tobacco and other native products.

Terms and conditions were also contained in the letter.* Accepting the invitation, Rallos proceeded to do a considerable business with Yangco trhough the said Collantes, as his

factor, sending to him as agent for Yangco a good deal of produce to be sold on commission.* Rallos sent to the said Collantes, as agent for Yangco, 218 bundles of tobacco in the leaf to be sold on commission, as had

been other produce previously.* The said Collantes received said tobacco and sold it for the sum of P1,744. The charges for such sale were P206.96, leaving

in the hands of said Collantes the sum of 1,537.08 belonging to Rallos. This sum was, apparently, converted to his own use by said agent.

* It appears, however, that prior to the sending of said tobacco Yangco had severed his relations with Collantes and that the latter was no longer acting as his factor. This fact was not known to Rallos; and it is conceded in the case that no notice of any kind was given by Yangco of the termination of the relations between Yangco and his agent, Collantes.

* Yangco thus refused to pay the said sum upon demand of Rallos, placing such refusal upon the ground that at the time the said tobacco was received and sold by Collantes, he was acting personally and not as agent of Yangco.

ISSUE: W/N Collantes is an agent of Yangco. If so, Yangco as principal must refund to Rallos the said sum brought by the sale of the produce

RULING: YesYangco, as principal is liable. Having advertised the fact that Collantes was his agent and having given special notice to Rallos

of that fact, and having given them a special invitation to deal with such agent, it was the duty of Yangco on the termination of the relationship of the principal and agent to give due and timely notice thereof to Rallos.

Failing to do so, he is responsible to them for whatever goods may been in good faith and without negligence sent to the agent without knowledge, actual or constructive, of the termination of such relationship

2. B. H. MACKE ET AL V JOSE CAMPS

FACTS:* B. H. Macke and W.H. Chandler, partners doing business under thee firm name of Macke, Chandler And Company, allege

that during the months of February and March 1905, they sold to Jose Camps and delivered at his place of business, known as the :Washington Café,” various bills of goods amounting to P351.50; that Camps has only paid on account of said goods the sum of P174; that there is still due them on account of said goods the sum of P177.50

* Plaintiffs made demand for the payment from defendant and that the latter failed and refused to pay the said balance or any part of it

* Macke, one of the plaintiffs, testified that on the order of one Ricardo Flores, who represented himself to be the agent of Jose Camps, he shipped the said goods to the defendant at the Washington Café; that Flores (agent) later acknowledged the receipt of the said goods and made various payments thereon amounting in all to P174; that believes that Flores is still the agent of Camps; and that when he went to the Washington Café for the purpose of collecting his bill he found Flores, in the absence of Camps, apparently in charge of the business and claiming to be the business manager of Camps, said business being that of a hotel with a bar and restaurant annexed.

* A written contract was introduced as evidence, from which it appears that one Galmes, the former of “Washington Café” subrented the building wherein the business was conducted, to Camps for 1 year for the purpose of carrying on that business, Camps obligating himself not to sublet or subrent the building or the business without the consent of the said Galmes. *This contract was signed by Camps and the name of Ricardo Flores as a witness and attached thereon is an inventory of the furniture and fittings which also is signed by Camps with the word “sublessee” below the name, and at the foot of this inventory the word “received” followed by the name “Ricardo Flores” with the words “managing agent” immediately following his name.

ISSUE: W/N Ricardol Flores was the agent of Camps

Ruling: YesEvidence is sufficient to sustain a finding that Flores is the agent of Camps in the management of the bar of the Washington

Café with authority to bind Camps, his principal, for the payment of the goodsThe contract sufficiently establishes the fact that Camps was the owner of the business and of the bar, and the title of

“managing agent” attached to the signature of Flores which appears on that contract, together with the fact that at the time the purchases were made, Flores was apparently in charge of the business performing the duties usually intrusted to a managing agent leave little room for doubt that he was there as the authorized agent of Camps.

Agency by Estoppel --- One who clothes another with apparent authority as his agent, and holds him out to the public as such, can not be permitted to deny the authority of such person to act as his agent, to the prejudice of innocent third persons dealing with such person in good faith and in the honest belief that he is what he appears to be.

Estopple---- “Whenever a party has, by his own declaration, act or omission, intentionally and deliberately led another to believe a particular thing true, and to act upon such belief, he can not, in any litigation arising out of such declaration, act, or omission be permitted to falsify; and unless the contrary appears, the authority of the agent must be presumed to include all the necessary and usual means of carrying his agency into effect.

J. DANON vs. A. BRIMO (1921) “Procuring Cause”

NATURE: Action to recover the sum of P60,000, alleged to be the value of services by the plaintiff as a broker.

QUICK FACTS & HELD:Danon (Broker) found a purchaser for the factory of his manager (Brimo), who promised 5% commission to Danon; Another broker found another purchaser who would buy the factory at a higher price, said factory was sold to this purchaser; As such, Danon’s client did not perfect the sale with Brimo. Held: Danon not the procuring cause. A broker is never entitled to commissions for unsuccessful efforts. The risk of failure is only his. The reward comes only with his success. Where no time for the continuance of the contract is fixed by its terms, either party is at liberty to terminate it at will, subject only to the ordinary requirements of good faith.

DETAILED FACTS:1. Antonio Brimo, informed the Danon, that he (Brimo) desired to sell his factory, the Holland American Oil Co., for the sum of

P1,200,0002. Brimo agreed and promised to pay to the Danon commission of 5% provided the latter could sell said factory for that amount 3. No definite period of time was fixed within which the Danon should effect the sale. It seems that another broker, Sellner, was also

negotiating the sale, or trying to find a purchaser for the same property and that the plaintiff was informed of the fact either by Brimo himself or by someone else; at least, it is probable that the plaintiff was aware that he was not alone in the field, and his whole effort was to forestall his competitor by being the first to find a purchaser and effect the sale.

4. Immediately after having an interview with Mr. Brimo, Danon went to see Mr. Mauro Prieto, president of the Santa Ana Oil Mill, a corporation, and offered to sell to him the defendant's property at P1,200,000. The said corporation was at that time in need of such a factory, and Mr. Prieto, instructed the manager, Samuel E. Kane, to see Mr. Brimo and ascertain whether he really wanted to sell said factory, and, if so, to get permission from him to inspect the premises. Mr. Kane inspected the factory and, presumably, made a favorable report to Mr. Prieto. The latter asked for an appointment with Mr. Brimo to perfect the negotiation. In the meantime Sellner, the other broker referred to, had found a purchaser for the same property, who ultimately bought it for P1,300,000. For that reason Mr. Prieto, the would be purchaser found by the plaintiff, never came to see Mr. Brimo to perfect the proposed negotiation.

ISSUE: Whether Danon as broker was the “Procuring Cause” of Sale? NO. Whether Danon is entitled to Compensation - NO

HELD: The most that can be said as to what the plaintiff had accomplished is, that he had found a person who  might have bought  the

defendant's factory. The evidence does not show that the Santa Ana Oil Mill had definitely decided to buy the property at the fixed price of P1,200,000. The plaintiff claims that the reason why the sale was not consummated was because Mr. Brimo refused to sell.

Defendant agreed and promised to pay him a commission of 5% provided he (the plaintiff) could sell the factory at P1,200.000. It is difficult to see how the plaintiff can recover anything in the premises. The plaintiff's action is an action to recover "the reasonable value" of services rendered.

It is clear that his "services" did not contribute towards bringing about the sale. He was not "the efficient agent or the procuring cause of the sale."

The broker must be the efficient agent or the procuring cause of sale . The means employed by him and his efforts must result in the sale.

The duty assumed by the broker is to bring the minds of the buyer and seller to an agreement for a sale, and the price and terms on which it is to be made, and until that is done his right to commissions does not accrue.

It follows, that a broker is never entitled to commissions for unsuccessful efforts. The risk of a failure is wholly his. The reward comes only with his success. He may have introduced to each other parties who otherwise would have never met; he may have created impressions, which under later and more favorable circumstances naturally lead to and materially assist in the consummation of a sale; he may have planted the very seed from which others reap the harvest; but all that gives him no claim.

The failure therefore and its consequences were the risk of the broker only. This however must be taken with one important and necessary limitation. If the efforts of the broker are rendered a failure by the fault of the employer; if  capriciously he changes his mind after the purchaser, ready and willing, and consenting to the prescribed terms, is produced; or if the latter declines to complete the contract because of some defect of title in the ownership of the seller, some unremoved incumbrance, some defect which is the fault of the latter, then the broker does not lose his commissions. But this limitation is not even an exception to the general rule affecting the broker's right for it goes on the ground that the broker has done his duty, that he has brought buyer and seller to an agreement, but that the contract is not consummated and fails though the after-fault of the seller.

One other principle applicable: Where no time for the continuance of the contract is fixed by its terms either party is at liberty to terminate it at will, subject only to the ordinary requirements of good faith. Usually the broker is entitled to a fair and reasonable opportunity to perform his obligation, subject of course to the right of the seller to sell independently. But having been granted him, the right of the principal to terminate his authority is absolute and unrestricted, except only that he may not do it in bad faith.

Although the present plaintiff could probably have effected the sale, he is not entitled to the commissions agreed upon because he had no intervention whatever in, and much sale in question. It must be borne in mind that no definite period was fixed by the defendant within which the plaintiff might effect the sale of its factory. Nor was the plaintiff given by the defendant the exclusive agency of such sale. Therefore, the plaintiff cannot complaint of the defendant's conduct in selling the property through another agent before the plaintiff's efforts were crowned with success. "One who has employed a broker can himself sell the property to a purchaser whom he has procured, without any aid from the broker."

DISPOSITIVE: For the foregoing reasons the judgment appealed from is hereby revoked and the defendant is hereby absolved from all liability under the plaintiff's complaint, with costs in both instances against the plaintiff. So ordered.

G.R. No. L-20567             July 30, 1965

PHILIPPINE NATIONAL BANK, vs. MANILA SURETY and FIDELITY CO., INC. and THE COURT OF APPEALS

Facts: The Philippine National Bank had opened a letter of credit and advanced $120,000.00 to Edgington Oil Refinery for 8,000 tons of hot asphalt. Of this amount, 2,000 tons worth P279,000.00 were released and delivered to Adams & Taguba Corporation (known as ATACO) under a trust receipt guaranteed by Manila Surety & Fidelity Co. up to the amount of P75,000.00. To pay for the asphalt, ATACO constituted the Bank its assignee and attorney-in-fact to receive and collect from the Bureau of Public Works the amount aforesaid out of funds payable to the assignor.ATACO delivered to the Bureau of Public Works, and the latter accepted, asphalt to the total value of P431,466.52. Of this amount the Bank regularly collected, from April 21, 1948 to November 18, 1948, P106,382.01. Thereafter, for unexplained reasons, the Bank ceased to collect, until in 1952 its investigators found that more money were payable to ATACO from the Public Works office, because the latter had allowed mother creditor to collect funds due to ATACO under the same purchase order to a total of P311,230.41. Its demands on the principal debtor and the Surety having been refused, the Bank sued both in the Court of First Instance of Manila to recover the balance of P158,563.18 as of February 15, 1950, plus interests and costs.The trial court rendered a decision Ordering defendants, Adams & Taguba Corporation and Manila Surety & Fidelity Co., Inc., to pay plaintiff, Philippines National Bank; Orderinq cross-defendant, Adams & Taguba Corporation, and third-party defendant, Pedro A. Taguba, jointly and severally, to pay cross and third-party plaintiff, Manila Surety & Fidelity Co., Inc., whatever amount the latter has paid or shall pay under this judgment; Dismissing the complaint insofar as the claim for 17% special tax is concerned; and Dismissing the counterclaim of defendants Adams & Taguba Corporation and Manila Surety & Fidelity Co., Inc.

From said decision, only the defendant Surety Company has duly perfected its appeal. The Central Bank of the Philippines did not appeal, while defendant ATACO failed to perfect its appeal.The Bank recoursed to the Court of Appeals, which rendered an adverse decision and modified the judgment of the court of origin as to the surety's liability. Its motions for reconsideration having proved unavailing, the Bank appealed to this Court.

Issue:

Held:

The Court of Appeals found the Bank to have been negligent in having stopped collecting from the Bureau of Public Works the moneys falling due in favor of the principal debtor, ATACO, from and after November 18, 1948, before the debt was fully collected, thereby allowing such funds to be taken and exhausted by other creditors to the prejudice of the surety, and held that the Bank's negligence resulted in exoneration of respondent Manila Surety & Fidelity Company.

This holding is now assailed by the Bank. It contends the power of attorney obtained from ATACO was merely in additional security in its favor, and that it was the duty of the surety, and not that of the creditor, owed see to it that the obligor fulfills his obligation, and that the creditor owed the surety no duty of active diligence to collect any, sum from the principal debtor, citing Judge Advocate General vs. Court of Appeals, G.R. No. L-10671, October 23, 1958.

This argument of appellant Bank misses the point. The Court of Appeals did not hold the Bank answerable for negligence in failing to collect from the principal debtor but for its neglect in collecting the sums due to the debtor from the Bureau of Public Works, contrary to its duty as holder of an exclusive and irrevocable power of attorney to make such collections, since an agent is required to act with the care of a good father of a family (Civ. Code, Art. 1887) and becomes liable for the damages which the principal may suffer through his non-performance (Civ. Code, Art. 1884). Certainly, the Bank could not expect that the Bank would diligently perform its duty under its power of attorney, but because they could not have collected from the Bureau even if they had attempted to do so. It must not be forgotten that the Bank's power to collect was expressly made irrevocable, so that the Bureau of Public Works could very well refuse to make payments to the principal debtor itself, and a fortiori reject any demands by the surety.

Even if the assignment with power of attorney from the principal debtor were considered as mere additional security still, by allowing the assigned funds to be exhausted without notifying the surety, the Bank deprived the former of any possibility of recoursing against that security.

83. Harry E. Keeler Electric Co. vs. RodriguezNovember 11,1922, Johns, J.

***This case involves an action for the payment of purchase price by plaintiff Keeler Electric against defendant Rodriguez

Legal Doctrine: Persons dealing with an assumed agent, whether the assumed agency be a general or special one, are bound at their peril, if they would hold the principal, to ascertain not only the fact of the agency but the nature and extent of the authority, and in case either is controverted, the burden of proof is upon them to establish it.

Facts: Plaintiff is Harry E. Keeler Electric Co., a domestic corporation based in Manila engaged in the electrical business, and among

other things in the sale of what is known as the "Matthews" electric plant. Defendant is Domingo Rodriguez a resident of Talisay, Occidental Negros Montelibano, a resident of Iloilo, went to Keeler Electric and made arrangement with the latter wherein:

o He claimed that he could find purchaser for the "Matthews" planto Keeler Electric told Montelibano that for any plant that he could sell or any customer that he could find he would be

paid a commission of 10% for his services, if the sale was consummated. Through Montelibano’s efforts, Keeler was able to sell to Rodriguez one of the "Matthews" plants Rodriguez paid Montelibano (the purchase price of P2,513.55), after the installation of the plant and without the knowledge of

Keeler Electric, Keeler Electric filed an action against Rodriguez for the payment of the purchase price. Rodriguez: Claimed that he already paid the price of the plant. In addition, he alleged that:

o Montelibano sold and delivered the plant to him, and "was the one who ordered the installation of that electrical plant" o There were evidences: a statement and receipt which Montelibano signed to whom he paid the money. o He paid Montelibano because the latter was the one who sold, delivered, and installed the electrical plant, and he

presented to him the account, and assured him that he was duly authorized to collect the value of the electrical planto The receipt had the following contents:

STATEMENT           Folio No. 2494 Mr. DOMINGO RODRIGUEZ, Iloilo, Iloilo, P.I.In account with HARRY E. KEELER ELECTRIC COMPANY, INC. 221 Calle Echaque, Quiapo, Manila, P.I. MANILA, P.I., August 18, 1920.          The answer alleges and the receipt shows upon its face that the plaintiff sold the plant to the defendant, and that he bought it from the plaintiff. The receipt is signed as follows:Received payment HARRY E. KEELER ELECTRIC CO. Inc.,Recibi(Sgd.) A. C. MONTELIBANO.

Witness (Juan Cenar) :o Cenar was sent by Keeler Electric to install the plant in Rodriguez’s premises in Iloiloo He brought with him a statement of account for Rodriguez but the latter said that he would pay in Manila.

***Lower Court: In favor of Rodriguez. It held that:o Keeler Electric had held out Montelibano to Rodriguez as an agent authorized to collecto Payment to Montelibano would discharge the debt of Rodriguezo The bill was given to Montelibano for collection purposes

Keeler Electric appealed. It alleged that:o Montelibano had no authority to receive the money. o His services were confined to the finding of purchasers for the "Matthews" plant o Montelibano was not an electrician, could not install the plant and did not know anything about its mechanism.

Issues:1. WON Keeler Electric authorized Montelibano to receive or receipt for money in its behalf

2. WON Rodriguez had a right to assume by any act or deed of Keeler Electric that Montelibano was authorized to receive the money

Held/Ratio: 

1. NO, Montelibano was not authorized. The plant was sold by Keeler Electric to Rodriguez and was consigned to Iloilo where it was installed by Cenar, acting for, and representing, Keeler Electric, whose expense for the trip is included in, and made a part of, the bill which was receipted by Montelibano.

a. Montelibano was not an agent of Keeler Electrico There is nothing on the face of this receipt to show that Montelibano was the agent of, or that he was acting for,

Keeler Electric. It is his own personal receipt and his own personal signature. o Outside of the fact that Montelibano received the money and signed this receipt, there is no evidence that he had any

authority, real or apparent, to receive or receipt for the money.o Neither is there any evidence that Keeler Electric ever delivered the statement to Montelibano. (It is very apparent

that the statement is the one which was delivered by Keeler Electric to Cenar, and is the one which Cenar delivered to Rodriguez)

b. It was Juan Cenar, and not Montelibano who sold the plant to Rodiguez

o The evidence is in direct conflict with Rodriguez’s own pleadings and the receipt statement which he offered in evidence. This statement also shows upon its face that P81.60 of the bill is round trip fare and machine’s transportation costs.

o This claim must be for the expenses of Cenar in going to Iloilo from Manila and return, to install the plant, and is strong evidence that it was Cenar and not Montelibano who installed the plant.

o If Montelibano installed the plant, there would not have been any necessity for Cenar to make this trip at the expense of Rodriguez.

o After Cenar's return to Manila, Keeler Electric wrote a letter to Rodriguez requesting the payment of its account, to which Rodriguez answered that he already paid to Montelibano.

This is in direct conflict with the receipted statement, which Rodriguez offered in evidence, signed by Montelibano.

o It will be noted that the receipt which Montelibano signed is not dated, and it does not show when the money was paid.

2. NO.

a. Relevant laws:− Article 1162 CC: Payment must be made to the persons in whose favor the obligation is constituted, or to another

authorized to receive it in his name.

− Article 1727 CC: The principal shall be liable as to matters with respect to which the agent has exceeded his authority only when he ratifies the same expressly or by implication.

− Ormachea Tin-Conco vs. Trillana: The repayment of a debt must be made to the person in whose favor the obligation is constituted, or to another expressly authorized to receive the payment in his name.

b. On whether an assumed authority exist – Certain principles must be considered: (Mechem on Agency, volume I, section 743)− (1) that the law indulges in no bare presumptions that an agency exists: it must be proved or presumed from facts; − (2) that the agent cannot establish his own authority, either by his representations or by assuming to exercise it; − (3) that an authority cannot be established by mere rumor or general reputation; − (4)that even a general authority is not an unlimited one; and − (5) that every authority must find its ultimate source in some act or omission of the principal.

Applying the above rules:o Persons dealing with an assumed agent, whether the assumed agency be a general or special one, are bound at

their peril, if they would hold the principal, to ascertain not only the fact of the agency but the nature and extent of the authority, and in case either is controverted, the burden of proof is upon them to establish it.

o The person dealing with the agent must act with ordinary prudence and reasonable diligence. Obviously, if he knows or has good reason to believe that the agent is exceeding his authority, he cannot claim protection. So if the suggestions of probable limitations be of such a clear and reasonable quality, or if the character assumed by the agent is of such a suspicious or unreasonable nature, or if the authority which he seeks to exercise is of such an unusual or improbable character, the party dealing with him may not shut his eyes to the real state of the case, but should either refuse to deal with the agent at all, or should ascertain from the principal the true condition of affairs.

Judgment of the lower court is REVERSED. Rodriguez should pay Keeler Electric the purchase price of the plant.

84. Rallos vs. YangcoSeptember 27, 1911, Moreland, J.

***This is an action to recover a sum of money by the consignor against the consignee

Legal Doctrine: The principal, having advertised the fact of appointment of an agent and having given the plaintiffs a special invitation to deal with such agent, has the duty on the termination of the relationship of principal and agent to give due and timely notice thereof to the plaintiffs. Failing to do so, he is responsible to them for whatever goods may have been in good faith and without negligence sent to the agent without knowledge, actual or constructive, of the termination of such relationship.

Facts:

Nov.1907, defendant Teodoro Yangco sent to plaintiff Florentino Rallos, among others, a letter proposing a consignment arrangement with the latter.

Rallos is engaged in the business of selling leaf tobacco and native products. In his letter, Yangco wants to be the consignee of Rallos on a commission basis. Yangco communicated to Rallos that in all

with his business dealings with the latter, Yangco will act through an agent Mr. Florentino Collantes. Yangco granted a public power of attorney to Collantes to carry out, in Yangco’s name, acts necessary for carrying out the

business. Rallos accepted the invitation and proceeded to do business with Yangco Collantes dealt with Rallos as agent of Yangco with regard to the produce to be sold on commission. Feb 1909, Rallos sent to Collantes, as agent for Yangco, 218 bundles of tobacco in the leaf to be sold on commission Collantes received said tobacco and sold for P1,744. The charges for such sale were P206.96, thus netting P1,537.08

belonging to Yangco. This sum was, apparently, converted to his own use by said agent. Prior to the sending of said tobacco, Yangco had severed his relations with Collantes and that the latter was no longer acting

as his factor. This fact was not known to the Rallos. No notice of any kind was given by Yangco to Rallos of the termination of the relations between Yangco and his agent. Yangco refused to pay the said sum upon demand of Rallos, on the ground that at the time the said tobacco was received and

sold by Collantes he was acting personally and not as agent of the defendant.

Issue: WON Rallos can recover from Yangco

Held/Ratio: YES, Yangco is liable. Having advertised the fact that Collantes was his agent and having given them a special invitation to deal with such agent, it

was the duty of Yangco on the termination of the relationship of principal and agent to give due and timely notice thereof to the plaintiffs.

Failing to do so, he is responsible to them for whatever goods may have been in good faith and without negligence sent to the agent without knowledge, actual or constructive, of the termination of such relationship.

Judgment appealed from is CONFIRMED.

[No. 21310. Department Two. March 18, 1929.] JOSEPH LEMARB, Appellant, v. M.D. POWER et al., Respondents. «1»[1] BROKERS (37) - PRINCIPAL AND AGENT (56) - MISREPRESENTATIONSOF AGENT - LIABILITY OF PRINCIPAL. A real estate broker,orally employed to find a purchaser, has no implied orapparent authority to make representations relative toprospective leases or offers of leases; although the ownermay be liable for false representations of the agent as tothe boundary line and location of improvements, if actualdamage result therefrom.Appeal from a judgment of the superior court forKing county, Ronald, J., entered February 1, 1928,upon findings in an action for fraud, tried to the court.Affirmed.Wright, Froude, Allen & Hilen, for appellant.Ballard & Houghton, for respondent Power et al.James H. Buchanan and Burkheimer & Burkheimer,for respondent Landon et al.PARKERPARKER, J. - The plaintiff, Lemarb, seeksrecovery of damages alleged as the result of falserepresentations made by the defendants Landon and wifeand one Bahnsen, their employed salesman, as agents ofthe defendant Mrs. Power, inducing Lemarb to purchasefrom Mrs. Power certain real property at aprice alleged to be largely in excess of its real value.The cause proceeded to trial in the superior court forKing county, sitting without a jury, resulting infindings and judgment awarding to Lemarb recovery inthe sum of sixty-one dollars. Lemarb, conceiving himselfaggrieved because of the inadequacy of this awardof damages, has appealed to this court.«1» Reported in 275 Pac. 561. 274 LEMARB v. POWER. Opinion Per PARKER, J. 151 Wash.The property here in question lies near the northerlylimits of the city of Seattle. It fronts northeighty-five feet on North Ninetieth street and east 102feet on Woodland Park avenue, which is the principalhighway leading out of the city to the north. There is,upon the northerly portion of the property, a seven-room dwelling house fronting east, sitting back somedistance from the avenue. There is, on the southerlyportion of the property, a small store building frontingeast on the avenue. The property is regarded asbusiness property, because of the increasing of businessalong the avenue in that immediate neighborhood.The property was owned by Mrs. Power. She, desiringto sell it, to that end authorized Mr. and Mrs.Landon, who were engaged in selling real propertyfor others, to find her a purchaser, she filing a tentativesale price of $15,000. This authorization was onlyorally made, and did not give to the Landons anyauthority to make a binding contract of sale with anyprospective purchaser. Bahnsen was a real estatesalesman in the employ of the Landons. Lemarb wasshown the property by Bahnsen, and, in doing so, hemade statements and representations relative to it,looking to the inducing of Lemarb to purchase it; which

statements, Lemarb claims, were false and inducedhim to purchase the property at the price of $15,000,which he claims was far in excess of its value, and thathe was thereby damaged.The principal alleged false representation, somade by Bahnsen to Lemarb, was that the Standard OilCompany was offering seventy-five dollars a monthfor a ten-year lease of a portion of the property onthe corner of the avenue and Ninetieth street for agasoline service station. The trial judge disallowedLemarb's claim for damages rested upon this principalfalse representation. Mother. alleged false representation LEMARB v. POWER. 275 Mar. 1929 Opinion Per PARKER, J.was that the store building was wholly onthe property, when in fact it extended slightly intothe avenue. This was remedied by Lemarb at an expenseof sixty-one dollars. It was for this item alonethat the trial court awarded recovery. Another allegedfalse representation was that the retaining wall, onwhat was supposed to be the property line in frontof the dwelling house along the avenue, was on thatline, when in fact it was slightly outside the propertyline upon the avenue. The trial court disallowed Lemarb'sclaim for damages rested upon this allegedfalse representation. The denial of this claim of damagewas, by the court, rested upon its conclusion that,whatever the representation was in that respect,Lemarb was not in fact damaged thereby.When Lemarb was shown the property by Bahnsen,they talked of price and terms; Lemarb then statingin substance that he would be willing to purchase theproperty at a $15,000 valuation, if the owner wouldtake, as $1500 part payment thereof, his automobile,he to make the balance of the payments upon termsto be agreed upon. They then went to the office of theLandons, the agents of the owner, Mrs. Power, wherefurther conversation was had with Mrs. Landon, whowas acting for the Landons, and where it becameunderstood that she would submit Lemarb's propositionto the owner, Mrs. Power. This was accordingly done,resulting in a formal sale contract in writing beinglater signed by Lemarb and Mrs. Power, she agreeingto convey the property to him for a total purchaseprice of $15,000, $1500 being paid by Lemarb conveyinghis automobile to her, $1500 being paid in cash, andthe balance to be partly paid in monthly installments,and partly by Lemarb assuming a mortgage then uponthe property. Mrs. Power, the owner, never, at anytime, made any statement to Lemarb concerning any 276 LEMARB v. POWER. Opinion Per PARKER, J. 151 Wash.prospective lease to the Standard Oil Company, nordid she authorize or know of any such statement beingmade to Lemarb by anyone. Mrs. Landon made nostatements to Lemarb concerning any prospective leaseto the Standard Oil Company, nor did she authorize orknow of any such statements being made to Lemarb byanyone. The same can be truthfully said of Mr. Landon,who had nothing to do with the negotiations lookingto the sale of the property to Lemarb. Neitherthe Landons, nor Bahnsen, their employed salesman,had any authority to enter into any binding contractfor the sale of the property, even at a cash price of$15,000, or upon any other terms.[1] Thus we have here, as our principal inquiry,the problem of whether the Landons had any impliedauthority from Mrs. Power to make any representationto a prospective purchaser, such as is claimed by

Lemarb was made to him by Bahnsen, relative to anoffer of leasing by the Standard Oil Company; andalso, in turn, the problem of whether Bahnsen had anyimplied authority from the Landons to make anyrepresentation to a prospective purchaser, as it is claimedby Lemarb was made to him by Bahnsen, relative toan offer of leasing by the Standard Oil Company. Itseems plain to us that there was a want of any suchauthority in the. Landons from Mrs. Power, and thatshe must be held free from liability for damages whichmay have resulted to Lemarb from the making of suchrepresentation by Bahnsen as agent of the Landons.It seems equally plain to us that there was a want ofany such authority in Bahnsen from the Landons, andthat they must be held free from liability for damageswhich may have resulted to Lemarb from the makingof any such representation by Bahnsen. Our decisionsin Johnson v. Williams, 133 Wash. 613, 234 Pac. 449,and Gudmundson v. Commercial Bank & Trust Co., LEMARB v. POWER. 277 Mar. 1929 Opinion Per PARKER, J.138 Wash. 355, 244 Pac. 676, seem to us decisive againstLemarb's right to recover damages against either Mrs.Power or the Landons; this upon the theory thatneither Mrs. Power nor the Landons, either directly orimpliedly, empowered Bahnsen to make any representationrelative to a prospective Standard Oil Companylease, as claimed by Lemarb. This branch of the casedoes not present the question of an owner's liabilityfor damages flowing from his agent making falserepresentations misleading a purchaser as to the identityof the property he believes he is purchasing, as wasdrawn in question in Nelson v. Title Trust Co., 52 Wash. 258,100 Pac. 730; O'Daniel v. Streeby, 77 Wash. 414,137 Pac. 1025, L.R.A. 1915F 634, and Yarnall v.Knickerbocker Co., 120 Wash. 205, 206 Pac. 936. Thedoctrine of those cases furnishes legal support for thetrial court's award of sixty-one dollars damagesresulting to Lemarb by his being led to believe fromstatements made by Bahnsen that the property linewas coincident with the front line of the store building.Authority to exhibit property to a prospectivepurchaser, is implied authority to identify the propertywith reasonable certainty; but not implied authorityto make misrepresentations as to a prospectivelease of the property.We have not overlooked our decision in Stanton v.St. Michell, 130 Wash. 449, 227 Pac. 737, stronglyrelied upon by counsel for Lemarb, wherein an agent'smisrepresentation to a purchaser as to a tax encumbrance,was held to render the vendor owner liable indamages. The want of authority in the agent makingsuch representation was not presented or consideredin that decision, as was pointed out in our decision inJohnson v. Williams, 133 Wash. 613, 234 Pac. 449. Norhave we overlooked our decision in Kelly v. Merrill,111 Wash. 426, 191 Pac. 404, strongly relied upon by 278 LEMARB v. POWER. Opinion Per PARKER, J. 151 Wash.counsel for Lemarb. That was not a case of an ownerbecoming liable by reason of misrepresentations of hisagent, but was a case of the agents who made or acquiescedin the making of the misrepresentations beingthemselves liable for damages resulting therefrom.Bahnsen, the agent who made the misrepresentationshere in question, is not sued in this action.As to the trial court's denial of recovery because ofthe retaining wall in front of the dwelling being in theavenue some two feet outside the property line, because

of which Lemarb claimed $140 damages, an examinationof the evidence convinces us that the trial courtcorrectly ruled that, regardless of what the representationmight have been leading Lemarb to believe thatthe retaining wall was upon the property line, noactual damage resulted to him from such representationThe judgment is affirmed.MITCHELL, C.J., MAIN, FRENCH, and MILLARD, JJ., concur.

Metropolitan Bank & Trust Company vs. Court of Appeals G.R. No. 88866 February 18, 1991 -negotiability FACTS:Eduardo Gomez opened an account with Golden Savings and Loan Association and deposited over a period of two months 38 treasury warrants with a total value of P1,755,228.37.  All  these warrants were subsequently indorsed by Gloria Castillo as Cashier of Golden Savings and deposited to its savings account in the Metrobank branch in Calapan, Mindoro. They were then sent for clearing by the branch office to the principal office of Metrobank, which forwarded them to the Bureau of Treasury for special clearing.   Before they were cleared,  petitioner decided to allow Golden Savings to withdraw from the proceeds of the warrants. Golden Savings in turn subsequently allowed Gomez to make withdrawals from his own account.  Subsequently, Metrobank informed Golden Savings that 32 of the warrants had been dishonored by the Bureau of Treasury and demanded the refund by Golden Savings of the amount it had previously withdrawn, to make up the deficit in its account.  Metrobank contends that by indorsing the warrants in general, Golden Savings assumed that they were "genuine and in all respects what they purport to be," in accordance with Section 66 of the Negotiable Instruments Law.

ISSUE:Whether petitioner can hold Golden Savings liable as an indorser of the treasury warrants based on the predication that the treasury warrants involved in this case are negotiable instruments.

RULING:Clearly stamped on the face of the treasury warrants is the word "non-negotiable."  It is also indicated that they are payable from a particular fund, to wit, Fund 501.  The indication of Fund 501 as the source of the payment to be made on the treasury warrants makes the order or promise to pay "not unconditional" and the warrants themselves non-negotiable.  Petitioner cannot hold Golden Savings liable as an indorser under Section 66 of the NIL for the simple reason that this law is not applicable to the non-negotiable treasury warrants.