GR L 3429; (December, 1906) (Digest)
G.R. No. L‑3429
December 6 1906
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FACTS
– Plaintiff‑appellant Castle Bros., Wolf & Sons sued Go‑Juno for ₱8,652.60, the price of 961 ⁸⁄₂₀ tons of Australian coal allegedly sold by the plaintiff to the defendant between 14‑25 August 1904.
– Defendant‑appellee filed a general denial and a special denial stating that on 15 August 1904 the plaintiff contracted to sell the balance of the cargo of the SS Coulsden (≈2,000 tons) to the defendant at ₱9 per ton.
– The sale contract was actually executed by Edward T. Miles, who acted as the plaintiff’s agent but did not disclose the principal (the plaintiff). The contract read:
> “I have this day bought from Edward T. Miles the balance of the cargo of the S.S. Coulsden, New Lanston coal, about two thousand (2,000) tons, … at nine pesos per ton, cash on delivery… G. Juno, E.C. Thomas.”
– The trial court held no privity of contract existed between plaintiff and defendant and dismissed the complaint, finding that an undisclosed agent cannot bind his principal under the Philippine Commercial Code.
– Plaintiff appealed, alleging error in dismissal, failure to render judgment for plaintiff, failure to make factual findings, and denial of a new‑trial motion.
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ISSUE
Whether an undisclosed principal (the plaintiff) may enforce a contract concluded by his agent (Miles) who acted without disclosing the principal, and whether the trial court erred in dismissing the action for lack of privity of contract.
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RULING
1. Undisclosed Agent Rule Articles 245, 246, 247 of the Commercial Code (as in force in the Philippines) provide that an agent who transacts in his own name without stating the existence of a principal is directly liable to the other contracting party; the principal cannot enforce the contract against that party.
2. The plaintiff, as an undisclosed principal, therefore had no right of action against the defendant. The absence of a written indication of the principal in the contract barred the plaintiff’s claim.
3. The trial court’s factual findings, though not fully recorded, were deemed sufficient; the appellate court found no manifest error.
4. Consequently, the dismissal was affirmed, and costs were awarded to the defendant.
Disposition: Judgment of the lower court affirmed; plaintiff’s appeal dismissed; costs awarded to the defendant.