GR 159489; (February, 2008) (Digest)

G.R. No. 159489; February 4, 2008
FILIPINAS LIFE ASSURANCE COMPANY (now AYALA LIFE ASSURANCE, INC.), petitioner, vs. CLEMENTE N. PEDROSO, TERESITA O. PEDROSO and JENNIFER N. PALACIO thru her Attorney-in-Fact PONCIANO C. MARQUEZ, respondents.

FACTS

Respondent Teresita O. Pedroso, a policyholder of petitioner Filipinas Life Assurance Company, was approached in January 1977 by Renato Valle, her insurance agent, who informed her of a promotional investment program offered by the company’s Escolta Office, promising an 8% prepaid monthly interest. Enticed, Pedroso issued a post-dated check for P10,000. Valle issued his personal check for the P800 interest and a Filipinas Life “Agent’s Receipt.” Pedroso verified the promotion with the Escolta office, speaking with administrative assistant Francisco Alcantara and branch manager Angel Apetrior, who both confirmed its existence and encouraged her to proceed. Her check, endorsed by Alcantara, was deposited into Filipinas Life’s bank account. After receiving a refund of her initial investment following a written request on a company inter-office form prepared by Alcantara, Pedroso made 7 to 8 more investments totaling P37,000 at a 5% prepaid interest rate. Respondent Jennifer N. Palacio, another policyholder, also invested P49,550 based on Pedroso’s referral. When the respondents later sought to withdraw their investments, Valle refused to return some amounts, and Filipinas Life itself refused to refund Palacio’s money despite demands. The respondents filed an action for recovery of a sum of money. The Regional Trial Court held Filipinas Life, Valle, Apetrior, and Alcantara jointly and solidarily liable, a decision affirmed by the Court of Appeals.

ISSUE

Whether the Court of Appeals erred in affirming the decision holding petitioner Filipinas Life jointly and severally liable with its co-defendants (agents Valle, Apetrior, and Alcantara) for the respondents’ claims, instead of holding agent Renato Valle solely liable.

RULING

The Supreme Court DENIED the petition and AFFIRMED the assailed Decision and Resolution of the Court of Appeals. The Court held that the appellate court committed no reversible error or grave abuse of discretion.
The Court ruled that petitioner Filipinas Life is liable for the obligations contracted by its agent, Renato Valle. While Filipinas Life contended that the investment scheme was outside the scope of its agents’ authority, the Court found that Valle’s authority to solicit and receive investments was established. Respondents exercised due diligence by verifying the promotion with the company’s supervisory personnel, Alcantara and Apetrior, who confirmed Valle’s authority. The investments were received using official company receipts and deposited into the company’s account, from which Filipinas Life benefited.
The general rule is that a principal is responsible for acts of its agent done within the scope of authority. Even if an agent exceeds his authority, the principal is solidarily liable if it allowed the agent to act as though he had full powers. Here, Filipinas Life, through the acts and confirmations of Alcantara and Apetrior, expressly and knowingly ratified Valle’s acts. The company clothed Valle with apparent authority and is thus estopped from denying such authority. The Court emphasized the principle “Qui per alium facit per seipsum facere videtur” (He who does a thing by an agent is considered as doing it himself). Innocent third parties should not be prejudiced by the principal’s failure to prevent misrepresentation, especially when the principal ratified the agent’s acts. Therefore, Filipinas Life was correctly held jointly and severally liable with its agents.