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May Agency Continue Even After the Death of the Principal?

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May Agency Continue Even After the Death of the Principal?

Read also: INSTANCES AFTER CONTRACT OF AGENCY CANNOT BE REVOKED AT WILL BY THE PRINCIPAL

  • Agency is terminated upon by the death of the principal.
  • However, agency may continue even after the death of the principal if the agency has been constituted in the common interest of the principal and the agent.
  • Agency may also continue even after the death of the principal if it has been constituted in the interest of a third person

Agency is terminated instantly by the death of the principal. This is because agency, being based on representation, there is no one to be represented where the principal is already dead.

However, there are exceptions to this rule.

Civil Code provides that:

“ The agency shall remain in full force and effect even after the death of the principal, if it has been constituted in the common interest of the latter and of the agent, or in the interest of a third person who has accepted the stipulation in his favor. ”

Accordingly, in the following cases, the agency remains in full force and effect even after the death of the principal:

  1. if the agency has been constituted in the common interest of the principal and the agent; and
  2. if it has been constituted in the interest of a third person

Example, when an agent renders services to a principal who authorizes the agent to sell the principal’s car for a certain price and pay himself out of the proceeds of the sale. Before the car is sold, the principal dies. It is clear that the agency to sell is one coupled with an interest. Therefore, the agency is not extinguished by the death of the principal.

Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/0917-5772207.

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