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Quiroga V Parsons Hardware

Quiroga sued Parsons Hardware claiming their contract established Parsons as Quiroga's agent for selling beds. However, the court found the contract was actually one of sale based on its provisions. Specifically, (1) Quiroga furnished the beds to Parsons; (2) Parsons paid Quiroga for the beds at a stipulated price with discounts; and (3) Quiroga determined the price. In agency contracts, the agent does not pay for the items but rather sells them on the principal's behalf and returns the proceeds. Therefore, the court concluded the contract was one of sale, not agency.

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Bianca Paloma
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49 views

Quiroga V Parsons Hardware

Quiroga sued Parsons Hardware claiming their contract established Parsons as Quiroga's agent for selling beds. However, the court found the contract was actually one of sale based on its provisions. Specifically, (1) Quiroga furnished the beds to Parsons; (2) Parsons paid Quiroga for the beds at a stipulated price with discounts; and (3) Quiroga determined the price. In agency contracts, the agent does not pay for the items but rather sells them on the principal's behalf and returns the proceeds. Therefore, the court concluded the contract was one of sale, not agency.

Uploaded by

Bianca Paloma
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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d.

P  cannot  sell  the  beds  at  a  higher  price  than  those  of  the 
[2] Quiroga v Parsons Hardware  invoices 
e. P  ​may  sell  or  establish  branches  ​of  his  agency  for  the  sale  of 
GR No. 11491 | August 23, 1918 | Sale vs. Agency | Vince  the beds 
2. Q  is  now  suing  P  for  an  alleged  breach  of  the  contract  for the following 
Petitioner: ​Andres Quiroga  grounds 
  a. Selling the beds at a higher price 
Respondent: P ​ arsons Hardware Co.  b. Not having an open establishment in iloilo 
  c. Keep beds on public display 
d. Pay for advertisement expenses 
Recit-Ready:   
3. Q  mainly  contends  that the contract is one of agency. Particularly, that P 
  is an agent of Q to sell the beds in iloilo 
Quiroga  and  Parsons  Hardware  entered  into  a  contract  wherein  Quiroga delivered 
beds  to  Parsons.  The  parties  stipulated  that  Parsons  gained the exclusive right to   
sell  the  beds,  in  the  visayan  islands,  among  others.  Quiroga  sued  parsons  on  the 
ISSUES:   
ground  that  many  of  the  provisions of the contract were breached. Quiroga’s main 
argument is that Parsons is his agent in selling the beds. 
Is the contract that of an agency or sale? S
​ ALE 
 
Whether the contract is that of agency or sale.  RATIO: 
   
The  court  ruled  that  it  is  a  contract  of  agency.  Circumstances  such  as  Quiroga  Rule 
furnishing  the beds to Parsons, Parsons paying for the beds at the stipulated price,   
Quiroga determining the price show that the contract was one of a sale.   In determining whether the contract is that of agency or of sale, the provisions of 
  the contract must be taken as a whole.  
Doctrine:   
  The contract is that of a sale 
In order to classify a contract, due regard must be given to its essential clauses.    
The following provisions and circumstances of the contract indicate that the 
FACTS:  contract is one of a sale and not of agency: 
1. Q furnishes the beds to P 
Characters to Note 
2. P pays for the beds at the price stipulated 
1. Quiroga  ​(Q)  -  the  bed  manufacturer.  Seller  of  the  bedsPetitioner  in  this  3. Q determines the price with a discount depending on the kind of bed 
case  4. Payment was made at the end of 60 days or at the request of Q 
2. Parsons  Hardware  ​(P)  -  the  company  that  bought  the  beds  in  order  to 
 
sell the same. Respondent in this case 
This cannot be an agency because in a contract of agency, the agent receives the 
  thing to sell it, and does not pay its price. Rather, the agent delivers the proceeds 
Events  of the sale to the principal.  
1. Quiroga  and Parsons hardware entered into a contract with the following   
(important) stipulations:   
a. Q grants P exclusive right to sell the beds in the Visayan islands.   None of the provisions show that the contract is that of agency 
b. Q will furnish the beds to B’s store   
c. P  ​will  pay  Q  for  the  beds  received  within  60  days from the date  The word ​commission on sales​ as used in the contract merely refers to the 
of shipment  discount on the invoice price. 
 
The word a ​ gency​ used in the contract only expresses that P was the only one that 
could sell the beds in the Visayan Islands 
 
Therefore, the contract is one of a sale.  

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