No third party prejudiced; agent's compensation based on equity

In the law on agency, it is elementary that when the main transaction between the principal parties does not materialize, the claim for commission of the duly authorized broker is disallowed. How about the instance when the sale was eventually consummated between parties introduced by a middleman who, in the first place, had no authority, express or implied, from the seller to broker the transaction? Should the interloper be allowed a commission? On these simplified terms rests the nature of the controversy on which this case turns. xxx

This is not a situation wherein a third party was prejudiced by the refusal of respondent DBP to recognize petitioner as its broker. The controversy is only between the DBP and petitioner, to whom it was emphasized in no uncertain terms that the arrangement sought did not exist. Article 1869, therefore, has no room for operation in this case. xxx

Petitioner claims the amount of P1,203,500.00 awarded by the trial court as commission computed at five percent of the sale price of the warehouse property. Under the foregoing disquisition and following the precedent, as well as roughly the proportion, set in Prats, the Court in equity grants petitioner the sum of One Hundred Thousand Pesos (Pl00,000.00) for the role it played in the transaction between respondent DBP and buyer Glaxo, Philippines. It is emphasized, however, that the circumstances that came into play in this case do not meet the minimum legal standards required for the existence of an agency relationship and that the award is based purely on equity considerations. Accordingly, petitioner's other arguments need not now be discussed. (G.R. No. 95909. August 16, 1991)