My friend, Dana, asked me to look for an online seller of luxury bags. Thus, I recommended Miss Olive, an online seller. My high school friend referred Miss Olive to me and so I, in turn, referred her to Dana. Sometime in November 2017, Dana bought a luxury bag from Miss Olive. We executed a written agreement, wherein I will buy the bag and Dana will pay me the purchase price. It was I who negotiated with Miss Olive, ordered the bag and had it delivered to my residential address. Upon delivery of the bag, I immediately gave it to Dana and she paid me for the bag. A month after the transaction, however, Dana called me and said that the bag I ordered from Miss Olive was fake. She showed me a certification from one of the stores in Makati City, stating that there was no serial number issued by the company for the bag. Thus, the item I bought from Miss Olive was counterfeit, spurious, fake.
Dana is angry about it and she wanted to get her money back from me. I told her that I was neither involved nor had any participation whatsoever about the purchase of the fake bag. I don’t know what to do about the matter.
My few questions are: Am I really liable to return the money to Dana? Was there a contract of agency with my transaction with Dana? And, considering the abovementioned circumstances, what charges can Dana or I file against Miss Olive?
Yes, you are liable to Dana. The contract you entered with Dana is not a contract of agency but a contract of sale. The Supreme Court ruled in the case Andres Quiroga vs. Parsons Hardware Co. (G.R. No. L-11491, August 23, 1918), penned by former Associate Justice Ramon Avanceña:
“In order to classify a contract, due regard must be given to its essential clauses. In the contract in question, what was essential, as constituting its cause and subject matter, is that the plaintiff was to furnish the defendant with the beds which the latter might order, at the price stipulated, and that the defendant was to pay the price in the manner stipulated. xxx Payment was to be made at the end of sixty days, or before, at the plaintiff’s request, or in cash, if the defendant so preferred, and in these last two cases an additional discount was to be allowed for prompt payment. These are precisely the essential features of a contract of purchase and sale. There was the obligation on the part of the plaintiff to supply the beds, and, on the part of the defendant, to pay their price.
These features exclude the legal conception of an agency or order to sell whereby the mandatory or agent received the thing to sell it, and does not pay its price, but delivers to the principal the price he obtains from the sale of the thing to a third person, and if he does not succeed in selling it, he returns it. By virtue of the contract between the plaintiff and the defendant, the latter, on receiving the beds, was necessarily obliged to pay their price within the term fixed, without any other consideration and regardless as to whether he had or had not sold the beds” (Emphasis supplied).
Moreover, the case of Victorias Milling Co. Inc. vs. Court of Appeals (G.R. No. 117356, June 19, 2000), penned by former Associate Justice Leonardo Quisumbing, emphasized “[O]ne factor which most clearly distinguishes agency from other legal concepts is control; one person — the agent — agrees to act under the control or direction of another — the principal. Indeed, the very word ‘agency’ has come to connote control by the principal. The control factor, more than any other, has caused the courts to put contracts between principal and agent in a separate category.”
Applying the foregoing to your case, it is clearly a contract of sale between you and Dana. In fact, Dana bought the bag from you when she handed you the money, which was used in buying the bag from Miss Olive. It is clearly apparent that you bought the bag from Miss Olive and had it delivered to your residential address. Upon delivery of the goods to your possession, the ownership thereof has been transferred to you. The subsequent delivery of the luxury bag to Dana is the consummation of the contract of sale you entered into with Dana.
Ultimately, Dana has no control over you, considering that you are the buyer of the luxury bag from Miss Olive, not an agent of Dana.
With regard to your second concern, only you can file a criminal charge against Miss Olive, since you, not Dana, are the injured party, considering that the contract you entered into with Miss Olive does not involve Dana.
Evidently, Miss Olive committed the crime of estafa. Under Article 315(2)(a) of the Revised Penal Code, it is stated:
“Art. 315. Swindling (estafa). — Any person who shall defraud another by any of the means mentioned herein below shall be punished by:
2. By means of any of the following false pretenses or fraudulent acts executed prior to or simultaneously with the commission of the fraud:
(a) By using fictitious name, or falsely pretending to possess power, influence, qualifications, property, credit, agency, business or imaginary transactions, or by means of other similar deceits” (Emphasis supplied).
As stated in the case of RCL Feeders PTE. Ltd. vs. Honorable Hernando Perez, in his capacity as Secretary of the Department of Justice, and Feliciano Zuluaga (G.R No. 162126, December 9, 2004), penned by former Associate Justice Consuelo Ynares-Santiago, “the elements of the crime of estafa under the foregoing provision are: (1) there must be a false pretense, fraudulent act or fraudulent means; (2) such false pretense, fraudulent act or fraudulent means must be made or executed prior to or simultaneously with the commission of the fraud; (3) the offended party must have relied on the false pretense, fraudulent act or fraudulent means and was thus induced to part with his money or property; and (4) as a result thereof, the offended party suffered damage.”
Applying the above-mentioned provision of law to your case, there was a false pretense on the part of Miss Olive that she sells authentic luxury items, which was made prior to the commission of fraud. You have relied on such false pretense, which caused you damage, upon notice that the item was certified to be fake.
We find it necessary to mention that this opinion is solely based on the facts you have narrated and our appreciation of the same. The opinion may vary when the facts are changed or elaborated.
We hope that we were able to enlighten you on the matter.
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