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Manotok Vrothers VS Ca

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G.R. No. 94753. April 7, 1993.

MANOTOK BROTHERS, INC., petitioner, 


vs.
THE HONORABLE COURT OF APPEALS, THE HONORABLE JUDGE OF THE REGIONAL TRIAL
COURT OF MANILA (Branch VI), and SALVADOR SALIGUMBA, respondents.

 Doctrines: • When there is a close, proximate and causal connection between the agent's
efforts and labor and the principal's sale of his property, the agent is entitled to a commission. •
Efficient procuring cause: when there is a close proximate and causal connection between the
efforts and labor of the agent and the principal’s sale of property.

Facts:
Manotok Brothers Inc. is the owner of a certain parcel of land and building which were
formerly leased by the City of Manila and used by the Claro M. Recto High School. Manotok
Brothers authorized Salvador Saligumba to negotiate with the City of Manila the sale of the
aforementioned property for not less than P425,000.00. 5% commission would be paid to him
in the event the sale is finally consummated and paid. Manotok executed a 2nd and 3rd letter,
each for 120 days, extending the authority of Saligumba. Finally, the 4th letter dated November
16, 1967, ManotoK with Rufino Manotok, its President, as signatory, authorized Saligumba to
finalize and consummate the sale of the property to the City of Manila for not less than
P410,000.00. With this letter came another extension of 180 days. The Municipal Board of the
City of Manila, on April 26, 1968, passed Ordinance No. 6603, appropriating the sum of
P410,816.00 for the purchase of the aforementioned property. Said ordinance however, was
signed by the City Mayor only on May 17, 1968, 183 days after the last letter of authorization.
On January 14, 1969, the parties signed the deed of sale. Saligumba never received any
commission (should have been P20,540.00). He filed a complaint against Manotok Brothers,
alleging that he had successfully negotiated the sale of the property. He claimed that it was
because of his efforts that the Municipal Board of Manila passed Ordinance No. 6603 which
appropriated the sum for the payment of the property subject of the sale. Manotok Brothers
claimed (1) a broker is only entitled to a commission if the sale was consummated and the price
paid within the period given in the respective letters of authority; and (2) that Filomeno E.
Huelgas, the PTA president of the Claro M. Recto High School was responsible for the
negotiation and consummation of the sale.

Issues: 1. W/N Saligumba is entitled to the five percent (5%) agent's commission.

Held/Ratio: 1. YES, Saligumba is entitled to the 5% agent’s commission because it was through
his efforts that a purchase actually materialized between the parties. It would seem that
Saligumba is not entitled to any commission because when the Deed of Sale was finally
executed, his extended authority had already expired. Going deeper however into the case
would reveal that it is within the coverage of the exception rather than of the general rule. In
an earlier case, this Court ruled that when there is a close, proximate and causal connection
between the agent's efforts and labor and the principal's sale of his property, the agent is
entitled to a commission.
We agree that the City of Manila ultimately became the purchaser of petitioner's property
mainly through the efforts of Saligumba. Without discounting the fact that when Municipal
Ordinance No. 6603 was signed by the City Mayor on May 17, 1968, Saligumba’s authority had
already expired, it is to be noted that the ordinance was approved on April 26, 1968 when
Saligumba’s authorization was still in force. Moreover, the approval by the City Mayor came
only 3 days after the expiration of Saligumba’s authority. It is also worth emphasizing that from
the records, the only party given a written authority by Manotok Brothers Inc. to negotiate the
sale from July 5, 1966 to May 14, 1968  
AGENCY DIGESTS   ALS2014B ATTY. COCHINGYAN was Saligumba. In the case at bar, private
respondent is the efficient procuring cause for without his efforts, the municipality would not
have anything to pass and the Mayor would not have anything to approve. Note: Although
Filomeno Huelgas followed up the matter with Councilor Magsalin (author of Ordinance) and
Mayor Villegas, his intervention regarding the purchase came only after the ordinance had
already been passed — when the buyer has already agreed to the purchase and to the price
for which said property is to be paid. 

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