Kue Cuison v. The Court of Appeals

Summary

This case involves a dispute over commercial liability arising from paper product transactions worth P297,487.30. Private respondent Valiant Investment Associates delivered goods to a third party based on orders from Tiu Huy Tiac, an employee of petitioner Kue Cuison's paper supply business. When Tiac's payment checks were dishonored, respondent sought payment from petitioner, claiming Tiac was authorized as branch manager. The trial court initially dismissed the case, but the Court of Appeals reversed, ordering payment. The Supreme Court affirmed, applying the doctrine of apparent authority and agency by estoppel. The Court found that petitioner's own acts and admissions, including introducing Tiac as branch manager and admitting in court that Tiac managed the store, created apparent authority. Under Civil Code Articles 1911 and 1431, petitioner was estopped from denying liability since innocent third parties relied on these representations in good faith. The decision establishes important precedent on agency by estoppel in commercial transactions.