Rosa Villa y Monna v. Guillermo Garcia Bosque

Summary

This 1926 Supreme Court case involved a breach of contract action for the sale of a Manila printing establishment. Rosa Villa y Monna, a Spanish widow, sold her business 'La Flor de Cataluña' to Filipino buyers for P56,000 in installments, with two Americans serving as sureties. When the buyers defaulted, an unauthorized agent attempted to release the sureties and novate the contract. The Supreme Court affirmed the trial court's judgment for the plaintiff, establishing important precedents on agency authority and surety law. The Court held that an agent's authority to collect debts does not include power to discharge obligations or modify contracts, and that time extensions on specific installments of a debt do not discharge sureties from liability on other installments. The decision reinforced principles of strict construction of agency powers and limited surety discharge under the Civil Code.