10/6/2017 G.R.No.

159489

SECONDDIVISION

FILIPINAS LIFE ASSURANCE G.R.No.159489
COMPANY (now AYALA LIFE
ASSURANCE,INC.), Present:
Petitioner,
QUISUMBING,J.,Chairperson,
CARPIO,
versus CARPIOMORALES,
TINGA,and
VELASCO,JR.,JJ.
CLEMENTEN.PEDROSO,
TERESITA O. PEDROSO and
JENNIFER N. PALACIO thru her
AttorneyinFact PONCIANO C. Promulgated:
MARQUEZ,
Respondents. February4,2008
xx

DECISION

QUISUMBING,J.:

[1]
This petition for review on certiorari seeks the reversal of the Decision and
[2]
Resolution, datedNovember29,2002andAugust5,2003,respectively,oftheCourtof
[3]
Appeals in CAG.R. CV No. 33568. The appellate court had affirmed the Decision
datedOctober10,1989oftheRegionalTrialCourt(RTC)ofManila,Branch3,finding
petitioner as defendant and the codefendants below jointly and severally liable to the
plaintiffs,nowhereinrespondents.

Theantecedentfactsareasfollows:

RespondentTeresitaO.Pedrosoisapolicyholderofa20yearendowmentlifeinsurance
issued by petitioner Filipinas Life Assurance Company (Filipinas Life). Pedroso claims
Renato Valle was her insurance agent since 1972 and Valle collected her monthly
premiums.InthefirstweekofJanuary1977,ValletoldherthattheFilipinasLifeEscolta
Officewasholdingapromotionalinvestmentprogramforpolicyholders.It was offering
8%prepaidinterestamonthforcertainamountsdepositedonamonthlybasis. Enticed,
[4]
sheinitiallyinvestedandissuedapostdatedcheckdatedJanuary7,1977forP10,000.

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[5]
Inreturn,ValleissuedPedrosohispersonalcheckforP800forthe8% prepaidinterest
[6]
andaFilipinasLifeAgentsReceiptNo.807838.

Subsequently, she called the Escolta office and talked to Francisco Alcantara, the
administrativeassistant,whoreferredhertothebranchmanager,AngelApetrior.Pedroso
inquiredaboutthepromotionalinvestmentandApetriorconfirmedthattherewassucha
promotion.Shewaseventoldshecouldpushthroughwiththechecksheissued.Fromthe
records, the check, with the endorsement of Alcantara at the back, was deposited in the
accountofFilipinasLifewiththeCommercialBankandTrustCompany(CBTC),Escolta
Branch.

Relying on the representations made by the petitioners duly authorized

representativesApetriorandAlcantara,aswellashavingknownagentValleforquitesome
time, Pedroso waited for the maturity of her initial investment. A month after, her
investmentofP10,000wasreturnedtoheraftershemadeawrittenrequestforitsrefund.
The formal written request, dated February 3, 1977, was written on an interoffice
[7]
memorandum form of Filipinas Life prepared by Alcantara. To collect the amount,
Pedroso personally went to the Escolta branch where Alcantara gave her the P10,000 in
cash. After a second investment, she made 7 to 8 more investments in varying amounts,
[8]
totalingP37,000 but at a lower rate of 5% prepaid interest a month. Upon maturity of
Pedrosos subsequent investments,Valle would take back from Pedroso the corresponding
yellowcoloredagentsreceiptheissuedtothelatter.

Pedroso told respondent Jennifer N. Palacio, also a Filipinas Life insurance

[9]
policyholder, about the investment plan. Palacio made a total investment of P49,550
butatonly5%prepaidinterest.However,whenPedrosotriedtowithdrawherinvestment,
ValledidnotwanttoreturnsomeP17,000worthofit.Palacioalsotriedtowithdrawhers,
but Filipinas Life, despite demands, refused to return her money. With the assistance of
their lawyer, they went to Filipinas Life Escolta Office to collect their respective
investments, and to inquire why they had not seen Valle for quite some time. But their
attempts were futile. Hence, respondents filed an action for the recovery of a sum of
money.

After trial, the RTC, Branch 3, Manila, held Filipinas Life and its codefendants
Valle,ApetriorandAlcantarajointlyandsolidarilyliabletotherespondents.

On appeal, the Court of Appeals affirmed the trial courts ruling and subsequently
deniedthemotionforreconsideration.

Petitionernowcomesbeforeusraisingasingleissue:

WHETHER OR NOT THE COURT OF APPEALS COMMITTED A REVERSIBLE

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ERROR AND GRAVELY ABUSED ITS DISCRETION IN AFFIRMING THE

DECISION OF THE LOWER COURT HOLDING FLAC [FILIPINAS LIFE] TO BE
JOINTLY AND SEVERALLY LIABLE WITH ITS CODEFENDANTS ON THE
CLAIMOFRESPONDENTSINSTEADOFHOLDINGITSAGENT,RENATOVALLE,
[10]
SOLELYLIABLETOTHERESPONDENTS.

Simplyput,didtheCourtofAppealserrinholdingpetitioneranditscodefendants
jointlyandseverallyliabletothehereinrespondents?

FilipinasLifedoesnotdisputethatVallewasitsagent,butclaimsthatitwasonlya
life insurance company and was not engaged in the business of collecting investment
money.ItcontendsthattheinvestmentschemeofferedtorespondentsbyValle,Apetrior
andAlcantarawasoutsidethescopeoftheirauthorityasagentsofFilipinasLifesuchthat,
[11]
itcannotbeheldliabletotherespondents.

On the other hand, respondents contend that Filipinas Life authorized Valle to
solicit investments from them. In fact, Filipinas Lifes official documents and facilities
were used in consummating the transactions. These transactions, according to
respondents, were confirmed by its officers Apetrior andAlcantara. Respondents assert
they exercised all the diligence required of them in ascertaining the authority of
petitionersagentsanditisFilipinasLifethatfailedinitsdutytoensurethatitsagentsact
withinthescopeoftheirauthority.

Consideringtheissueraisedinthelightofthesubmissionsoftheparties,wefind
that the petition lacks merit. The Court of Appeals committed no reversible error nor
abusedgravelyitsdiscretioninrenderingtheassaileddecisionandresolution.

ItappearsindisputablethatrespondentsPedrosoandPalaciohadinvestedP47,000
and P49,550, respectively. These were received by Valle and remitted to Filipinas Life,
using Filipinas Lifes official receipts, whose authenticity were not disputed. Valles
authority to solicit and receive investments was also established by the parties. When
respondentssoughtconfirmation,Alcantara,holdingasupervisoryposition,andApetrior,
the branch manager, confirmed that Valle had authority. While it is true that a person
dealing with an agent is put upon inquiry and must discover at his own peril the agents
authority,inthiscase,respondentsdidexerciseduediligenceinremovingalldoubtsand
inconfirmingthevalidityoftherepresentationsmadebyValle.

FilipinasLife,astheprincipal,isliableforobligationscontractedbyitsagentValle.
By the contract of agency, a person binds himself to render some service or to do
somethinginrepresentationoronbehalfofanother,withtheconsentorauthorityofthe
[12]
latter. Thegeneralruleisthattheprincipalisresponsiblefortheactsofitsagentdone
[13]
withinthescopeofitsauthority,andshouldbearthedamagecausedtothirdpersons.
Whentheagentexceedshisauthority,theagentbecomespersonallyliableforthedamage.
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[14]
Butevenwhentheagentexceedshisauthority,theprincipalisstillsolidarilyliable
togetherwiththeagentiftheprincipalallowedtheagenttoactasthoughtheagenthad
[15]
fullpowers. Inotherwords,theactsofanagentbeyondthescopeofhisauthoritydo
[16]
not bind the principal, unless the principal ratifies them, expressly or impliedly.
Ratificationinagencyistheadoptionorconfirmationbyonepersonofanactperformed
[17]
onhisbehalfbyanotherwithoutauthority.

FilipinasLifecannotprofessignoranceofVallesacts.EvenifVallesrepresentations
were beyond his authority as a debit/insurance agent, Filipinas Life thru Alcantara and
Apetrior expressly and knowingly ratified Valles acts. It cannot even be denied that
Filipinas Life benefited from the investments deposited by Valle in the account of
Filipinas Life. In our considered view, Filipinas Life had clothed Valle with apparent
authorityhence,itisnowestoppedtodenysaidauthority.Innocentthirdpersonsshould
not be prejudiced if the principal failed to adopt the needed measures to prevent
misrepresentation,muchmoresoiftheprincipalratifiedhisagentsactsbeyondthelatters
authority.Theactoftheagentisconsideredthatoftheprincipalitself.Quiperaliumfacit
per seipsum facere videtur. He who does a thing by an agent is considered as doing it
[18]
himself.

WHEREFORE, the petition is DENIED for lack of merit. The Decision and
Resolution,datedNovember29, 2002 and August 5, 2003, respectively, of the Court of
AppealsinCAG.R.CVNo.33568areAFFIRMED.

Costsagainstthepetitioner.

SOORDERED.





LEONARDOA.QUISUMBING
AssociateJustice


WECONCUR:





ANTONIOT.CARPIO
AssociateJustice

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CONCHITACARPIOMORALES DANTEO.TINGA
AssociateJustice AssociateJustice

PRESBITEROJ.VELASCO,JR.
AssociateJustice

ATTESTATION

IattestthattheconclusionsintheaboveDecisionhadbeenreachedinconsultationbefore
thecasewasassignedtothewriteroftheopinionoftheCourtsDivision.





LEONARDOA.QUISUMBING
AssociateJustice
Chairperson


CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairpersons
Attestation, I certify that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the Courts
Division.





REYNATOS.PUNO
ChiefJustice

[1]
Rollo, pp. 4355. Penned by Associate Justice Renato C. Dacudao, with Associate Justices Eugenio S. Labitoria and
DaniloB.Pineconcurring.
[2]
Id.at56.
[3]
Id.at5763.PennedbyJudgeClementeM.Soriano.
[4]
Records,p.246.
[5]
TSN,October7,1983,pp.910.

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[6]
Records,p.248.
[7]
Id.at247.
[8]
Supranote5.
[9]
Records,pp.253264.
[10]
Rollo,p.108.
[11]
Id.at109.
[12]
CIVILCODE,Art.1868.
[13]
Lopez,etal.v.Hon.Alvendia,etal.,120Phil.1424,14311432(1964).
[14]
BAFinanceCorporationv.CourtofAppeals,G.R.No.94566,July3,1992,211SCRA112,118.
[15]
CIVILCODE,Art.1911.
[16]
Id.,Art.1910.Theprincipalmustcomplywithalltheobligationswhichtheagentmayhavecontractedwithinthescope
ofhisauthority.
As for any obligation wherein the agent has exceeded his power, the principal is not bound except when he ratifies it
expresslyortacitly.
[17]
ManilaMemorialParkCemetery,Inc.v.Linsangan,G.R.No.151319,November22,2004,443SCRA377,394.
[18]
PrudentialBankv.CourtofAppeals,G.R.No.108957,June14,1993,223SCRA350,357.

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