Lex Rex Ph

Doctrine of Apparent Authority

The Doctrine of Apparent Authority is applied when a corporation knowingly permits one of its officers or agent to act within the scope of apparent authority. This doctrine is present when the corp. holds the agent out to the public as someone who possesses the power to do such acts. As a consequence, the corporation is estopped to deny such authority to the officer or agent. – People’s Aircargo vs. CA

It exists even the defendant alleges that the corp’s “corporate practices” do not allow the agent to exercise such power – ibid

Proofs that may substantiate this doctrine as laid down in Advance Paper Corp vs. Arma Traders Corp:

  1. The AoI provides that such agent may exercise such authority;
  2. The agent is also an incorporator and has been exercising such authority for a prolonged period;
  3. Testimony that such agent is an expert in that area; (People’s Aircargo)
  4. The corporation is lax in establishing safeguards to prevent abuse;
  5. There is no connivance between the agent and the alleged conspirator.

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