(13) Serona v. People of the Philippines, G.R. No.

130423, Novermber 18, 2002

DOCTRINES:
 The law on agency in our jurisdiction allows the appointment by an agent of a substitute or sub-
agent in the absence of an express agreement to the contrary between the agent and the
principal.
 An agent who is not prohibited from appointing a sub-agent but does so without express
authority is responsible for the acts of the sub-agent.

FACTS:
Quilatan delivered to Serona several pieces of jewelry, which the latter would sell on commission basis.
The terms of the oral contract were that Serona should remit payment or return the jewelry if not sold,
both within thirty days. Serona’s failure to pay/return prompted Quilatan to require the former to execute
a document evidencing her debt of 567,750. Unknown to Quilatan, Serona delivered the jewelries to
Marichu Labrador (Labrador) to sell on commission basis. Serona failed to collect from Labrador, which
caused Serona’s failure to pay its obligation to Quilatan.

Subsequent to the submission of final demand a complaint affidavit against Serona was filed and the
subsequent filing of an information for Estafa under Article 315 with the RTC.

The RTC rendered a decision finding Serona guilty as charged which was affirmed by the CA with
modification on the penalty imposed.

ISSUES:
1) Whether or not there was an abuse of confidence on the part of petitioner Serona in entrusting the
subject jewelries to a sub-agent also for sale on commission.
2) Whether or not there was misappropriation or conversion on the part of petitioner Serona when she
failed to pay and/or return the jewelries after the end of the agreed term.

SC RULING:

1) NO. An agent who is not prohibited from appointing a sub-agent but does so without express
authority is responsible for the acts of the sub-agent. Serona did not ipso facto commit the crime of
estafa through conversion or misappropriation by delivering the jewelries to a sub-agent for sale on
commission basis. The law on agency in our jurisdiction allows the appointment by an agent of a
substitute or sub-agent in the absence of an express agreement to the contrary between the agent
and the principal. In the case at bar, the appointment of Labrador as petitioner’s sub-agent was not
expressly prohibited by Quilatan, as the acknowledgement receipt does not contain any such
limitation. Neither does it appear that petitioner was verbally forbidden by Quilatan from passing on
the jewelries to another person before the acknowledgement receipt was executed or at any other
time. Thus, it cannot be said that petitioner’s act of entrusting the jewelries to Labrador us
characterized by abuse of confidence because such an act was not proscribed and is, in fact, legally
sanctioned.

2) NO. It was established that the inability of petitioner as agent to comply with her duty to return either
the pieces of jewelry or the proceeds of its sale to her principal Quilatan as due, in turn, to the failure
 of sub-agent Labrador to abide by her agreement with petitioner. Notably, Labrador testified that she
obligated herself to sell the jewelry in behalf of petitioner also on commission basis or return the same
of not sold. In other words, the pieces of jewelry were given by petitioner to achieve the very sane
end for which they were delivered to her in the first place.

Consequently, there was no conversion since the pieces of jewelry were not devoted to a purpose or
use different from that agreed upon. Similarly, it cannot be said that petitioner misappropriated the
jewelry or delivered them to Labrador without the right to do so. Aside from the fact that no condition
or limitation was imposed on the mode or manner by which petitioner was to effectuate the sale, it is
also consistent with the usual practice for the seller to necessarily part with the valuables in order to
find a buyer and allow inspection of the items for sale.

Serona was acquitted for the the crime of estafa, but was held civilly liable. The rule is that an accused
acquitted of estafa may nevertheless be held civilly liable where the facts established by the evidence so
warrant.