TOPIC: AGENT IS CRIMINALLY LIABLE FOR CRIME
DBP deducted the
COMMITTED IN THE PURSUIT OF AGENCY
Eurotech vs. Cuison
GR No. 167552
April 23, 2007
FACTS:
Petitioner is engaged in business of importation
and distribution of various European industrial
equipment for customers in the Philippines. One
of its customers Impact System Sales owned by
respondent Erwin Cuizon and its sales manager
is respondent Edwin Cuizon. Petitioner sold to
Impact Systems a sludge pump but refused to
deliver the same because respondents did not
fully settle their indebtedness to petitioner. On
June 1995, respondent Edwin and petitioner
executed a Deed of Assignment wherein
respondent assigned receivables to petitioner
for the delivery of the sludge pump. Unknown to
the petitioner, respondent still collected the
receivables despite the Assignment. Petitioner
filed an action against the respondents.
ISSUE:
Whether or not Edwin Cuizon is personally liable
in the indebtedness of the company
Held:
No. Article 1897 provides that an agent who acts
as such is not personally liable to party with
whom he contracts except when (1) he expressly
binds himself to the obligation and (2) when he
exceeded his authority. The Deed of Assignment
clearly states that respondent Edwin Cuizon
signed as the sales manager of Impact Systems.
DBP vs CA
449 SCRA 57
FACTS: Juan B. Dans, 76 years of age, together
with his family, applied for a loan worth Php 500,
000 at the Development Bank of the Philipppines
on May 1987. The loan was approved by the
bank dated August 4, 1987 but in the reduced
amount of Php 300, 000. Mr. Dans was advised
by DBP to obtain a mortgage redemption
insurance at DBP MRI pool.
amount to be paid for MRI Premium that is
worth Php 1476.00. The insurance of Mr. Dans,
less the DBP service fee of 10%, was credited by
DBP to the savings account of DBP MRI-Pool.
Accordingly, the DBP MRI Pool was advised of
the credit.
On September 3, 1987, Mr. Dans died of
cardiac arrest. DBP MRI notified DBP was not
eligible for the coverage of insurance for he was
beyond the maximum age of 60. The wife,
Candida, filed a complaint to the Regional Trial
Court Branch I Basilan against DBP and DBP MRI
pool for ‘Collection of Sum of Money with
Damages’. Prior to that, DBP offered the
administratrix (Mrs. Dans) a refund of the MRI
payment but she refused for insisting that the
family of the deceased must receive the amount
equivalent of the loan. DBP also offered and ex
gratia for settlement worth Php 30, 000. Mrs.
Dans refused to take the offer. The decision of
the RTC rendered in favor of the family of the
deceased and against DBP. However, DBP
appealed to the court.
ISSUE: Whether or not the DBP MRI Pool should
be held liable on the ground that the contract
was already perfected.
HELD: No. DBP MRI Pool is not liable. Though the
power to approve the insurance is lodged to the
pool, the DBP MRI Pool did not approve the
application of the deceased. There was no
perfected contract between the insurance pool
and Mr. Dans.
DBP was wearing two legal hats: as a
lender and insurance agent. As an insurance
agent, DBP made believed that the family
already fulfilled the requirements for the said
insurance although DBP had a full knowledge
that the application would never be approved.
DBP acted beyond the scope of its authority for
accepting applications for MRI. If the third
person who contracted is unaware of the
authority conferred by the principal on the agent
and he has been deceived, the latter is liable for
damages. The limits of the agency carries with it
the implication that a deception was
perpetrated—Articles 19-21 come into play.
However, DBP is not entitled to
compensate the family of the deceased with the
entire value of the insurance policy. Speculative
damages are too remote to be included in the
cost of damages. Mr. Dans is entitled only to
moral damages. Such damages do not need a
proof of pecuniary loss for assessment. The court
granted only moral damages (Php 50, 000) plus
attorney fees’s (Php 10, 000) and the
reimbursement of the MRI fees with legal
interest from the date of the filing of the
complaint until fully paid.
People vs. Chowdury
325 SCRA 572
February 15, 2000
Facts
Bulu Chowdury was charged with the crime of
illegal recruitment in large scale by recruiting
Estrella B. Calleja, Melvin C. Miranda and Aser S.
Sasis for employment in Korea. Evidence shows
that accused –appellant interviewed private
complainant in 1994 at Craftrade’s office, and
required them to submit requirements such as
passport, NBI clearance, ID pictures, medical
certificate and birth certificate. Chowdury also
required them to pay placements fee for a
certain amount. At that time, he was an
interviewer of Craftrade which was operating
under temporary authority given by POEA
pending the renewal of license. He was charged
based on the fact that he was not registered with
the POEA as employee of Craftrade and he is not
in his personal capacity, licensed to recruit
overseas workers. The complainants also
averred that during their applications for
employment for abroad, the license of Craftrade
was already expired.
For his defense Chowdury testified that he
worked as interviewer at Craftrade from 1990
until 1994. His primary duty was to interview job
applicants for abroad. As a mere employee, he
only followed the instructions given by his
superiors, Mr. Emmanuel Geslani, the agency's
President and General Manager, and Mr.
UtkalChowdury, the agency's Managing
Director.
The trial Court found Chowdury huilty beyond
reasonable doubt of the crime of illegal
recruitment in large scale.
Issue: Whether or not accused-appellant
knowingly and intentionally participated in the
commission of the crime charged.
Held
No. The elements of illegal recruitment
in large scale are:
(1) The accused undertook any recruitment
activity defined under Article 13 (b) or any
prohibited practice enumerated under Article 34
of the Labor Code;
(2) He did not have the license or authority to
lawfully engage in the recruitment and
placement of workers; and
(3) He committed the same against three or
more persons, individually or as a group.
The last paragraph of Section 6 of
Republic Act (RA) 804219 states who shall be
held liable for the offense, thus: “The persons
criminally liable for the above offenses are the
principals, accomplices and accessories. In case
of juridical persons, the officers having control,
management or direction of their business shall
be liable.”
An employee of a company or
corporation engaged in illegal recruitment may
be held liable as principal, together with his
employer, if it is shown that he actively and
consciously participated in illegal recruitment.
The culpability of the employee therefore hinges
on his knowledge of the offense and his active
participation in its commission. Where it is
shown that the employee was merely acting
under the direction of his superiors and was
unaware that his acts constituted a crime, he
may not be held criminally liable for an act done
for and in behalf of his employer.
In this case, Chowdury merely performed his
tasks under the supervision of its president and
managing director. The prosecution failed to
show that the accused-appellant is conscious
and has an active participation in the
commission of the crime of illegal recruitment.
Moreover, accused-appellant was not aware of
Craftrade's failure to register his name with the
POEA and the prosecution failed to prove that he
actively engaged in recruitment despite this
knowledge. The obligation to register its
personnel with the POEA belongs to the officers
of the agency. A mere employee of the agency
cannot be expected to know the legal
requirements for its operation. The accused-
appellant carried out his duties as interviewer of
Craftrade believing that the agency was duly
licensed by the POEA and he, in turn, was duly
authorized by his agency to deal with the
applicants in its behalf. Accused-appellant in fact
confined his actions to his job description. He
merely interviewed the applicants and informed
them of the requirements for deployment but he
never received money from them. Chowdury did
not knowingly and intentionally participated in
the commission of illegal recruitment being
merely performing his task and unaware of
illegality of recruitment.

TOPIC: Commission Agent CANNOT SELL on

credit without principal’s consent (Art. 1905).
Otherwise: Considered as Cash Sales

Green Valley vs. IAC

133 SCRA 697
1984

FACTS: