GR 94050; (November, 1991) (Digest)
G.R. No. 94050 November 21, 1991
SYLVIA H. BEDIA and HONTIVEROS & ASSOCIATED PRODUCERS PHIL. YIELDS, INC., petitioners, vs. EMILY A. WHITE and HOLMAN T. WHITE, respondents.
FACTS
Private respondent Emily A. White entered into a “Participation Contract” for a booth at the 1980 Dallas State Fair, signing as “Participant” for “Emily White Enterprises.” Petitioner Sylvia H. Bedia signed the contract on the line marked “ACCEPTED BY.” The contract was typed on the letterhead of Hontiveros & Associated Producers Phil. Yields, Inc. White made a $500 down payment to Bedia. Upon traveling to Dallas, White discovered no booth was registered in her name. White and her husband sued Bedia and Hontiveros for damages, alleging fraud. During trial, the complaint against Hontiveros was dismissed upon White’s own motion. The trial court and the Court of Appeals held Bedia personally liable, finding she contracted in her own capacity, not as an agent.
ISSUE
Whether Sylvia H. Bedia acted in her personal capacity or as an authorized agent of Hontiveros when she entered into the Participation Contract with Emily White.
RULING
The Supreme Court reversed the lower courts, ruling Bedia acted as an agent. The legal logic centers on the principles of agency and the plaintiffs’ own actions. First, the contract was executed on Hontiveros’s official stationery, strongly indicating Bedia was acting for the corporation. Second, in a prior letter to the Minister of Trade, White herself stated she was “recruited by Hontiveros,” which was an acknowledgment of the agency. Third, Hontiveros, in its joint answer with Bedia, affirmed her agency and never repudiated her authority.
Crucially, under Article 1910 of the Civil Code, obligations contracted by an agent within the scope of authority bind the principal. Since Bedia was acting within her authority for Hontiveros, any liability under the contract should attach to the principal, not the agent. The Court emphasized that by voluntarily moving to dismiss the complaint against the principal Hontiveros, the Whites forfeited their claim against it. Having absolved the principal, they cannot subsequently pursue the agent for the same contractual obligation. The dismissal of the case against Bedia was therefore proper.