TITLE X Article 1874.

 When a sale of a piece of land

AGENCY or any interest therein is through an agent, the
authority of the latter shall be in writing;
CHAPTER 1 otherwise, the sale shall be void. (n)
Nature, Form and Kinds of Agency
Article 1875. Agency is presumed to be for a
Article 1868. By the contract of agency, a compensation, unless there is proof to the
person binds himself to render some service contrary. (n)
or to do something in representation or on
behalf of another, with the consent or authority Article 1876. An agency is either general or
of the latter. (1709a) special.

Article 1869. Agency may be express, or The former comprises all the business of the
implied from the acts of the principal, from his principal. The latter, one or more specific
silence or lack of action, or his failure to transactions. (1712)
repudiate the agency, knowing that another
person is acting on his behalf without Article 1877. An agency couched in general
authority. terms comprises only acts of administration,
even if the principal should state that he
Agency may be oral, unless the law requires a withholds no power or that the agent may
specific form. (1710a) execute such acts as he may consider
appropriate, or even though the agency should
Article 1870. Acceptance by the agent may authorize a general and unlimited
also be express, or implied from his acts which management. (n)
carry out the agency, or from his silence or
inaction according to the circumstances. (n) Article 1878. Special powers of attorney are
necessary in the following cases:
Article 1871. Between persons who are
present, the acceptance of the agency may (1) To make such payments as are not
also be implied if the principal delivers his usually considered as acts of
power of attorney to the agent and the latter administration;
receives it without any objection. (n)
(2) To effect novation which put an
Article 1872. Between persons who are end to obligations already in existence
absent, the acceptance of the agency cannot at the time the agency was
be implied from the silence of the agent, constituted;
except:
(3) To compromise, to submit
(1) When the principal transmits his questions to arbitration, to renounce
power of attorney to the agent, who the right to appeal from a judgment, to
receives it without any objection; waive objections to the venue of an
action or to abandon a prescription
(2) When the principal entrusts to him already acquired;
by letter or telegram a power of
attorney with respect to the business (4) To waive any obligation
in which he is habitually engaged as gratuitously;
an agent, and he did not reply to the
letter or telegram. (n) (5) To enter into any contract by which
the ownership of an immovable is
Article 1873. If a person specially informs transmitted or acquired either
another or states by public advertisement that gratuitously or for a valuable
he has given a power of attorney to a third consideration;
person, the latter thereby becomes a duly
authorized agent, in the former case with (6) To make gifts, except customary
respect to the person who received the special ones for charity or those made to
information, and in the latter case with regard employees in the business managed
to any person. by the agent;

The power shall continue to be in full force (7) To loan or borrow money, unless
until the notice is rescinded in the same the latter act be urgent and
manner in which it was given. (n)
 indispensable for the preservation of The provisions of this article shall be
the things which are under understood to be without prejudice to the
administration; actions between the principal and agent.
(1717)
(8) To lease any real property to
another person for more than one CHAPTER 2
year; Obligations of the Agent

(9) To bind the principal to render Article 1884. The agent is bound by his
some service without compensation; acceptance to carry out the agency, and is
liable for the damages which, through his non-
(10) To bind the principal in a contract performance, the principal may suffer.
of partnership;
He must also finish the business already
(11) To obligate the principal as a begun on the death of the principal, should
guarantor or surety; delay entail any danger. (1718)

(12) To create or convey real rights Article 1885. In case a person declines an
over immovable property; agency, he is bound to observe the diligence
of a good father of a family in the custody and
preservation of the goods forwarded to him by
(13) To accept or repudiate an
the owner until the latter should appoint an
inheritance;
agent or take charge of the goods. (n)
(14) To ratify or recognize obligations
Article 1886. Should there be a stipulation
contracted before the agency;
that the agent shall advance the necessary
funds, he shall be bound to do so except when
(15) Any other act of strict dominion. the principal is insolvent. (n)
(n)
Article 1887. In the execution of the agency,
Article 1879. A special power to sell excludes the agent shall act in accordance with the
the power to mortgage; and a special power to instructions of the principal.
mortgage does not include the power to sell.
(n)
In default thereof, he shall do all that a good
father of a family would do, as required by the
Article 1880. A special power to compromise nature of the business. (1719)
does not authorize submission to arbitration.
(1713a)
Article 1888. An agent shall not carry out an
agency if its execution would manifestly result
Article 1881. The agent must act within the in loss or damage to the principal. (n)
scope of his authority. He may do such acts as
may be conducive to the accomplishment of
Article 1889. The agent shall be liable for
the purpose of the agency. (1714a)
damages if, there being a conflict between his
interests and those of the principal, he should
Article 1882. The limits of the agent's prefer his own. (n)
authority shall not be considered exceeded
should it have been performed in a manner
Article 1890. If the agent has been
more advantageous to the principal than that
empowered to borrow money, he may himself
specified by him. (1715)
be the lender at the current rate of interest. If
he has been authorized to lend money at
Article 1883. If an agent acts in his own interest, he cannot borrow it without the
name, the principal has no right of action consent of the principal. (n)
against the persons with whom the agent has
contracted; neither have such persons against
Article 1891. Every agent is bound to render
the principal.
an account of his transactions and to deliver to
the principal whatever he may have received
In such case the agent is the one directly by virtue of the agency, even though it may not
bound in favor of the person with whom he has be owing to the principal.
contracted, as if the transaction were his own,
except when the contract involves things
belonging to the principal.
Every stipulation exempting the agent from the undertook to secure the principal's ratification.
obligation to render an account shall be void. (n)
(1720a)
Article 1899. If a duly authorized agent acts in
Article 1892. The agent may appoint a accordance with the orders of the principal, the
substitute if the principal has not prohibited latter cannot set up the ignorance of the agent
him from doing so; but he shall be responsible as to circumstances whereof he himself was,
for the acts of the substitute: or ought to have been, aware. (n)

(1) When he was not given the power to Article 1900. So far as third persons are
appoint one; concerned, an act is deemed to have been
performed within the scope of the agent's
(2) When he was given such power, but authority, if such act is within the terms of the
without designating the person, and the power of attorney, as written, even if the agent
person appointed was notoriously incompetent has in fact exceeded the limits of his authority
or insolvent. according to an understanding between the
principal and the agent. (n)
All acts of the substitute appointed against the
prohibition of the principal shall be void. (1721) Article 1901. A third person cannot set up the
fact that the agent has exceeded his powers, if
the principal has ratified, or has signified his
Article 1893. In the cases mentioned in Nos. 1
willingness to ratify the agent's acts. (n)
and 2 of the preceding articles, the principal
may furthermore bring an action against the
substitute with respect to the obligations which Article 1902. A third person with whom the
the latter has contracted under the agent wishes to contract on behalf of the
substitution. (1722a) principal may require the presentation of the
power of attorney, or the instructions as
regards the agency. Private or secret orders
Article 1894. The responsibility of two or more
and instructions of the principal do not
agents, even though they have been
prejudice third persons who have relied upon
appointed simultaneously, is not solidary, if
the power of attorney or instructions shown
solidarity has not been expressly stipulated.
them. (n)
(1723)

Article 1903. The commission agent shall be

Article 1895. If solidarity has been agreed
responsible for the goods received by him in
upon, each of the agents is responsible for the
the terms and conditions and as described in
non-fulfillment of agency, and for the fault or
the consignment, unless upon receiving them
negligence of his fellow agents, except in the
he should make a written statement of the
latter case when the fellow agents acted
damage and deterioration suffered by the
beyond the scope of their authority. (n)
same. (n)
Article 1896. The agent owes interest on the
Article 1904. The commission agent who
sums he has applied to his own use from the
handles goods of the same kind and mark,
day on which he did so, and on those which he
which belong to different owners, shall
still owes after the extinguishment of the
distinguish them by countermarks, and
agency. (1724a)
designate the merchandise respectively
belonging to each principal. (n)
Article 1897. The agent who acts as such is
not personally liable to the party with whom he
Article 1905. The commission agent cannot,
contracts, unless he expressly binds himself or
without the express or implied consent of the
exceeds the limits of his authority without
principal, sell on credit. Should he do so, the
giving such party sufficient notice of his
principal may demand from him payment in
powers. (1725)
cash, but the commission agent shall be
entitled to any interest or benefit, which may
Article 1898. If the agent contracts in the result from such sale. (n)
name of the principal, exceeding the scope of
his authority, and the principal does not ratify
Article 1906. Should the commission agent,
the contract, it shall be void if the party with
with authority of the principal, sell on credit, he
whom the agent contracted is aware of the
shall so inform the principal, with a statement
limits of the powers granted by the principal. In
of the names of the buyers. Should he fail to
this case, however, the agent is liable if he
do so, the sale shall be deemed to have been
made for cash insofar as the principal is Article 1913. The principal must also
concerned. (n) indemnify the agent for all the damages which
the execution of the agency may have caused
Article 1907. Should the commission agent the latter, without fault or negligence on his
receive on a sale, in addition to the ordinary part. (1729)
commission, another called a guarantee
commission, he shall bear the risk of collection Article 1914. The agent may retain in pledge
and shall pay the principal the proceeds of the the things which are the object of the agency
sale on the same terms agreed upon with the until the principal effects the reimbursement
purchaser. (n) and pays the indemnity set forth in the two
preceding articles. (1730)
Article 1908. The commission agent who
does not collect the credits of his principal at Article 1915. If two or more persons have
the time when they become due and appointed an agent for a common transaction
demandable shall be liable for damages, or undertaking, they shall be solidarily liable to
unless he proves that he exercised due the agent for all the consequences of the
diligence for that purpose. (n) agency. (1731)

Article 1909. The agent is responsible not Article 1916. When two persons contract with
only for fraud, but also for negligence, which regard to the same thing, one of them with the
shall be judged with more or less rigor by the agent and the other with the principal, and the
courts, according to whether the agency was two contracts are incompatible with each
or was not for a compensation. (1726) other, that of prior date shall be preferred,
without prejudice to the provisions of article
1544. (n)

CHAPTER 3 Article 1917. In the case referred to in the

Obligations of the Principal preceding article, if the agent has acted in
good faith, the principal shall be liable in
damages to the third person whose contract
Article 1910. The principal must comply with
must be rejected. If the agent acted in bad
all the obligations which the agent may have
faith, he alone shall be responsible. (n)
contracted within the scope of his authority.

Article 1918. The principal is not liable for the

As for any obligation wherein the agent has
expenses incurred by the agent in the
exceeded his power, the principal is not bound
following cases:
except when he ratifies it expressly or tacitly.
(1727)
(1) If the agent acted in contravention
of the principal's instructions, unless
Article 1911. Even when the agent has
the latter should wish to avail himself
exceeded his authority, the principal is
of the benefits derived from the
solidarily liable with the agent if the former
contract;
allowed the latter to act as though he had full
powers. (n)
(2) When the expenses were due to
the fault of the agent;
Article 1912. The principal must advance to
the agent, should the latter so request, the
sums necessary for the execution of the (3) When the agent incurred them with
agency. knowledge that an unfavorable result
would ensue, if the principal was not
aware thereof;
Should the agent have advanced them, the
principal must reimburse him therefor, even if
the business or undertaking was not (4) When it was stipulated that the
successful, provided the agent is free from all expenses would be borne by the
fault. agent, or that the latter would be
allowed only a certain sum. (n)
The reimbursement shall include interest on
the sums advanced, from the day on which the
advance was made. (1728)
 CHAPTER 4 Article 1926. A general power of attorney is
Modes of Extinguishment of Agency revoked by a special one granted to another
agent, as regards the special matter involved
Article 1919. Agency is extinguished: in the latter. (n)

(1) By its revocation; Article 1927. An agency cannot be revoked if

a bilateral contract depends upon it, or if it is
the means of fulfilling an obligation already
(2) By the withdrawal of the agent;
contracted, or if a partner is appointed
manager of a partnership in the contract of
(3) By the death, civil interdiction, partnership and his removal from the
insanity or insolvency of the principal management is unjustifiable. (n)
or of the agent;
Article 1928. The agent may withdraw from
(4) By the dissolution of the firm or the agency by giving due notice to the
corporation which entrusted or principal. If the latter should suffer any
accepted the agency; damage by reason of the withdrawal, the
agent must indemnify him therefor, unless the
(5) By the accomplishment of the agent should base his withdrawal upon the
object or purpose of the agency; impossibility of continuing the performance of
the agency without grave detriment to himself.
(6) By the expiration of the period for (1736a)
which the agency was constituted.
(1732a) Article 1929. The agent, even if he should
withdraw from the agency for a valid reason,
Article 1920. The principal may revoke the must continue to act until the principal has had
agency at will, and compel the agent to return reasonable opportunity to take the necessary
the document evidencing the agency. Such steps to meet the situation. (1737a)
revocation may be express or implied. (1733a)
Article 1930. The agency shall remain in full
Article 1921. If the agency has been entrusted force and effect even after the death of the
for the purpose of contracting with specified principal, if it has been constituted in the
persons, its revocation shall not prejudice the common interest of the latter and of the agent,
latter if they were not given notice thereof. or in the interest of a third person who has
(1734) accepted the stipulation in his favor. (n)

Article 1922. If the agent had general powers, Article 1931. Anything done by the agent,
revocation of the agency does not prejudice without knowledge of the death of the principal
third persons who acted in good faith and or of any other cause which extinguishes the
without knowledge of the revocation. Notice of agency, is valid and shall be fully effective with
the revocation in a newspaper of general respect to third persons who may have
circulation is a sufficient warning to third contracted with him in good faith. (1738)
persons. (n)
Article 1932. If the agent dies, his heirs must
Article 1923. The appointment of a new agent notify the principal thereof, and in the
for the same business or transaction revokes meantime adopt such measures as the
the previous agency from the day on which circumstances may demand in the interest of
notice thereof was given to the former agent, the latter. (1739)
without prejudice to the provisions of the two
preceding articles. (1735a)

Article 1924. The agency is revoked if the

principal directly manages the business
entrusted to the agent, dealing directly with
third persons. (n)

Article 1925. When two or more principals

have granted a power of attorney for a
common transaction, any one of them may
revoke the same without the consent of the
others. (n)