Table of Contents

CASE DIGESTS

TORTS AND DAMAGES

Outline by Atty. Nicanor B. Jimeno & Atty. Linda Jimeno

Almario

Quasi-Delict (Art. 2176) Barredo vs. Garcia and Elcano vs. Hill 9 Cinco vs. Canonoy 10

Baksh vs. Court of Appeals 10

Dulay vs. Court of Appeals 11

Damage, Damages, Injury 12

(As of 1

8

semester SY 2010-2011)

People vs. Ballesteros 12

Custodio vs. Court of Appeals 12

Board of Liquidators vs. Heirs of Kalaw 13

Custodio vs. Court of Appeals 13

Art. 2176 of the Civil Code 14

Garcia vs. Florido 14

Andamo vs. Court of Appeals 15

Taylor vs. Manila Electric Railroad and Light Co. 15

Tayag vs. Alcantara 16

Quasi Delict vs. Delict 17

Barredo vs. Garcia- Art. 2177 Discussion 17

People vs. Ligon 17

Padilla vs. Court of Appeals 18

Cruz vs. Court of Appeals 18

Philippine Rabbit Bus Lines, Inc. vs. People 19

Quasi-delict vs. Breach of Contract 20

Cangco vs. Manila Railroad Co. 20

Fores vs. Miranda 21

Far East Bank and Trust Company vs. Court of Appeals 22

Air France vs. Carrascoso 22

PSBA vs. Court of Appeals 24

Syquia vs. Court of Appeals and Manila Memorial Park and Cemetery, Inc. 24

Vicente Calalas vs. Court of Appeals 25

N egligence

P icart vs. Smith

Negligence in special cases (Children) 26

JARCO Marketing Corporation vs. Court of Appeals and Spouses Aguilar 26

Del Rosario vs. Manila Electric Company 27

Ylarde vs. Aquino 28

Negligence (Experts/Professionals) 29

Cullion Ice, Fish and Electric Company vs. Philippine Motors Corporation 29

U S v. Pineda BPI v. CA 31

Intoxication 34

U S vs. Baggay 3 5

D egrees of Negligence 3 5

Marinduque vs.Workmen’s Compensation 35

Res Ipsa Loquitur 36

R amos vs. CA 3 7

Batiquin vs. CA 39

D.M. Consunji vs. CA 40

Defenses (Plaintiff’s negligence) 41

M anila Electric Co. vs Remonquillo Bernardo vs. Legaspi 41

Bernal vs. House 42

P LDT vs. CA

D efenses (Contributory Negligence) Genobiagon vs. Court of Appeals 43

Rakes vs. Atlantic 43

Philippine Bank of Commerce v CA (Lipana) 44

Defenses (Fortuitous Event) 45

Juntilla vs. Fontanar 45

Hernandez vs. Commission on Audit 46

Gotesco vs. Chatto and Lina Delza Chatto 47

Servando vs. Philippine Steam Navigation Co 48

NAPOCOR vs. CA 49

S outheastern College Inc. v CA 5 0

A SSUMPTION OF RISK

Afialda vs. Hisole 51

Ilocos Norte Electric Company (INEL Co.)vs. Court of Appeals 51

D UE DILIGENCE 5 2

Ramos, et al vs. Pepsi-Cola Bottling Co. of the P.I., et al 52

Metro Manila Transit Corp. (MMTC) vs. CA 53

PRESCRIPTION 54

K ramer vs. Court of Appeals

Allied Banking Corporation vs. Court of Appeals 55

Causation (Proximate Cause) 55

B ataclan vs. Medina 5 5

Fernando vs. Court of Appeals and the City of Davao 56

Urbano vs. IAC 57

Phoenix Construction vs. IAC 57

Pilipinas Bank v. CA 58

Quezon City Government vs. Fulgencio Dacara 59

Remote cause, distinguished from Proximate case 60

Gabeto vs. Araneta 60

Urbano vs. IAC 61

Concurrent Cause, distinguished from Proximate 61

Far Eastern Shipping Co. vs. Court of Appeals 61

Subido vs. Custodio 61

TESTS of proximate cause- the “BUT FOR” test 62

Bataclan vs. Medina 62

Substantial Factor Test 63

Philippine Rabbit vs. IAC and Casiano Pascua et al. 63

Cause v. Condition 64

Phoenix Construction vs. IAC 64

Manila Electric Co. vs. Remoquillo 64

Rodrigueza vs. Manila Railroad Co. 65

Efficient Intervening Cause 65

McKee vs. IAC 65

Manila Electric vs. Remonquillo 67

Teague vs. Fernandez 67

Urbano vs. IAC 68

Last Clear Chance 68

P icart vs. Smith

Bustamante vs. Court Of Appeals 69

Phoenix Construction Inc. vs. IAC 69

Philippine Bank Of Commerce vs. CA (Lipana) 71

Glan People’s Lumber And Hardware vs. IAC 72

Pantranco vs. Baesa 72

Ong vs. Metropolitan Water District 73

A NURAN vs. BUÑO CANLAS vs. CA 74

Consolidated Bank vs. Court Of Appeals 75

E NGADA vs. CA 7 6

S trict liability

Vestil vs. IAC 77

Things thrown from a building 77

D ingcong vs. Kanaan 7 7

Death/Injuries in the course of employment 78

Afable vs. Singer Sewing Machine Company 78

Coca Cola Bottlers vs. Ca 79

I nterference of Contractual Relations Gilchrist vs. Cuddy, et al. 79

So Ping Bun vs. CA 80

G uilatco vs. City of Dagupan 8 1

L iability of Governmental Units 8 1

Worcester vs. Ocampo 81

J. H. Chapman vs. James M. Underwood 82

C aedo vs. Yu Khe Thai 8 3

Felina Rodriguez-Luna vs. IAC 84

Vicarious liability of Parents 84

Exconde vs .Capuno 84

S alen vs Balce 8 5

FUELLAS v CADANO 85

Gutierrez vs. Gutierrez 86

R odriguez-Luna v IAC

C uadra vs. Monfort 8 6

Libi v. IAC 86

214 SCRA 16 (1990) 86

T amargo vs CA

Vicarious liability of teachers and heads of institutions 87

Mercado vs. CA 87

Palisoc vs. CA 88

A madora vs. CA Pasco vs. CFI 90

YLarde vs. Aquino 90

S alvosa vs. IAC

S t. Francis High School vs. CA PSBA vs. CA 93

Soliman vs. Tuason 93

S t. Mary’s Academy vs. Carpitanos 9 4

Vicarious liability of owners and managers of establishments 95

Philippine Rabbit vs. Philippine American 95

Vicarious Liability of employers 96

P hiltranco vs. CA

Castilex vs. Vasquez 96

Filamer vs. IAC 97

N PC vs. CA 9 8

L ight Rail Transit vs. Navidad Mckee vs. IAC 99

Valenzuela vs. CA 100

99

V icarious liability of the State 1 01

E. Merritt vs Government Of The Philippine Islands 101

Inocencio Rosete vs.The Auditor General 101

Mendoza vs. De Leon, et al. 102

F ontanilla vs. Maliaman

102

City of Manila vs. Teotico 103

Liability of employees 104

A raneta vs. De Joya

104

Engineers/Architect- Nature of liability 104

Lanuzo vs. Sy Bon Ping 104

Malipol vs. Tan 105

V iluan vs. CA 1 05

Torts with Independent Civil Actions (Violation of Civil and Political rights) 106

Lim vs. Ponce De Leon 106

Aberca vs. Ver 107

M HP Garments vs. CA 1 07

Independent Civil Action (Defamation, Fraud and Physical Injuries) 108

Marcia et al. vs.CA 108

M adeja v. Caro 1 08

A rafiles v. Phil. Journalists 1 09

Defamation 110

MVRS vs. Islamic 110

F raud

110

Salta v. De Veyra 110

Physical Injuries 111

Capuno v. Pepsi Cola 111

C orpus v. Paje

112

Dulay v. CA 112

Intentional Tort (Abuse of Right) 113

V elayo v. Shell 1 13

S audi Arabia v. CA 1 14

Globe Mackay v. CA 115

Albenson v. CA 116

A monoy v. Gutierrez UE v. Jader 118

117

Garciano v. CA, et al. 119

Barons vs. CA 120

B PI vs. CA 1 21

Acts Contra Bonus Mora 122

Ruiz v. Secretary of National Defense 122

Breach of promise to marry, seduction and sexual assault 123

W assmer vs. Velez

123

TANJANCO vs. SANTOS 124

Bunag vs. CA 124

C onstantino vs. Mendez 1 25

Quimiguing vs. Icao 126

Pe vs. Pe 126

Malicious Prosecution 127

Lao vs. Associated Anglo American Tobacco 127

Que vs. IAC 128

Drilon vs CA 129

P ublic Humiliation 1 30

P atricio vs. Leviste

130

Grand Union Supermarket, Inc. vs. Espino 131

Unjust Dismissal 132

M edina vs. Castro-Bartolome 1 33

Derelection of duty 134

Amaro vs. Sumanguit 134

Violation of human dignity and Privacy 134

C oncepcion v. CA 1 35

Concept of Damages 136

Heirs of Borlado vs. Vda. De Bulan 136

L azatin vs. Twano 1 36

A ctual or Compensatory Damages Algarra vs. Sandejas 137

Kinds of Actual Damages 137

137

I ntegrated Packaging Corp. vs. CA 1 37

Attorney’s fees 138

Quirante v. Intermediate Appellate Court 138

I nterest 1 39

Crismina Garments, Inc. vs. CA 139

Mitigation of Liability 139

Cerrano vs. Tan Chuco 139

M oral Damages 1 40

Kierulf vs. CA 140

Proof and Proximate Cause 141

M iranda-Ribaya vs. Carbonell 1 41

D el Rosario vs. CA Raagas vs. Traya 144

143

Enervida vs. Dela Torre 145

P eople vs. Bugayong 1 46

Francisco vs. GSIS 146

Expertravel & Tours, Inc. vs. Court Of Appeals 147

Unfounded suits 148

Editha and Glicerio Mijares vs. CA and Metro Drug, Inc. 148

J Marketing vs. Sia 150

Cometa vs. Court of Appeals 151

Triple Eight Integrated Services, Inc vs. NLRC 152

P eople of the Philippines vs. Pirame 1 54

Arcona vs. Court of Appeals 155

Factors in determining amount 156

Philippine National Bank vs. Court of Appeals 156

Gregorio Fule vs. Court of Appeals 156

Philippine Airlines vs. Court of Appeals 158

Valenzuela vs. CA 158

Aurelio Sumaplong vs. Court of Appeals 160

Lopez vs. Pan-American World Airways 160

Producers Bank of the Philippines vs. CA and Spouses Chua 162

W ho may recover? S trebel vs Figueras

163

163

ABS-CBN vs. Court of Appeals 164

National Power v. Philipp Brothers 165

N ominal Damages 1 66

Ventanilla vs. Gregorio Centeno 166

Robes-Francisco Realty and Development Corp. vs.CFI 166

People vs Gopio 167

Dr. Armovit, et al. vs. CA and Northwest Airlines, Inc. 168

Temperate Damages 169

People vs. Singh 169

People of the Philippines vs. Edison Plazo 169

P NB vs. CA 1 70

Quasi-Delict (Art. 2176)

Barredo vs. Garcia and Almario

73 Phil. 607 (July 8, 1942)

Facts: A taxicab figured in a head-on collision with a carretela. The carretela overturned, causing death to one of its passengers, a 16-year old boy. A criminal case was instituted by the parents of the deceased against Fontanilla, the driver of the taxicab, wherein the former reserved the right to institute a separate civil action for damages. The driver of the taxicab was convicted. Subsequently, the parents instituted the present civil action for damages against Barredo, the employer of the taxicab driver. Barredo contends that his liability rests only on the provision of the penal code and hence, since no civil action has been filed against Fontanilla, he too cannot be held civilly responsible.

Issue: Can plaintiffs bring a separate civil action against the employer of the taxicab driver making him primarily and directly responsible under Art. 1903 of the Civil Code?

Held: YES. A Quasi-delict is separate and distinct from the civil responsibility arising from criminal liability. Under Article 1903 of the Civil Code, an employer is primarily and directly responsible for the negligent acts of his employee.

There are two remedies available for the parents to choose:

. The first is under Article 100 of the Penal Code wherein the employer is only subsidiarily liable for damages arising from the crime committed by his employees. If the parents choose this remedy, the complainant must first exhaust the properties of the employee, before the employer’s properties could be made answerable.

. The other action is under Article 1903 of the Civil code (quasi-delict or culpa aquiliana) wherein the negligent employer is held primarily liable, subject to the defense that he exercised the diligence of a good father of the family in the selection and engagement of his employees.

In this case, the parents chose the second type of action since it is more practical to file for damages against the employer, who is more solvent than his employee.

NOTE: The Barredo case was decided by the Supreme Court prior to the effectivity of the new Civil Code. The principle enunciated in said case (that responsibility for fault or negligence under a quasi-delict is separate and distinct from the negligence penalized under the Revised Penal Code) is now specifically embodied in Art. 2177 of the New Civil Code.

Elcano vs. Hill

77 SCRA 98 (May 26, 1977)

Facts: Reginald Hill was prosecuted criminally for killing Agapito Elcano. At the time of the occurrence, Reginald Hill is still a minor and, under laws effective at the time, also legally married. Reginald is still living and receives subsistence from his father, Marvin Hill. Reginald was acquitted on the ground that his acts were not criminal because of “lack of intent to kill, coupled with mistake.”

Issues: (1) Does the prior acquittal of Reginald bar the present civil action for damages? (2) Is Atty. Marvin Hill vicariously liable?

Held: 1. No. The acquittal of Reginald Hill in the criminal case does not extinguish his liability arising from quasi-delict. For one, the quantum of proof required in the criminal case differs from that required in a civil suit. To find the accused guilty in a criminal case, proof beyond reasonable doubt is required unlike in civil cases, preponderance of evidence is sufficient.

The concept of culpa acquiliana includes acts which are criminal in character or in violation of the penal law, whether voluntary or negligent. Art 2177 of the New Civil Code provides that “Responsibility for fault or negligence is separate and distinct from the civil liability arising from negligence under the Penal Code. However, plaintiff cannot recover damages twice for the same act or omission of the defendant.”

Consequently, a separate civil action lies against the offender in a criminal act, whether or not he is criminally prosecuted, provided that the offended party is not allowed, if he is also criminally charged, to recover damages on both scores. And assuming awards made in the two cases vary, he would be entitled only to the bigger award of the two.

In other words, the extinction of civil liability refers exclusively to the civil liability founded on Article 100 of the Revised Penal Code. The civil liability arising from quasi- delict is not extinguished even by a declaration in the criminal case that the accused is acquitted.

2. While it is true that parental authority is terminated upon emancipation by marriage of the minor, such emancipation is not absolute and full. Reginald although married, was living with his father and still dependent from the latter. ART 2180 applies to Atty. Marvin Hill notwithstanding the emancipation by marriage of Reginald. The minor may be emancipated, but that does not mean that he is no longer under the responsibility of his parents.

In the instant case, it is not controverted that Reginald, although married, was living with his father and getting subsistence from him at the time of the occurrence in question.

Factually, therefore, Reginald was still subservient to and dependent on his father, a situation which is not unusual.

However, inasmuch as Reginald is now of age (at the time the case reached the Supreme Court), it is a matter of equity that the liability of Atty. Hill should be declared merely subsidiary to that of his son.

Note: In this case, there is no doubt that Reginald killed Elcano. His acquittal is based on “lack of intent to kill, coupled with mistake” and not on the non-commission of the acts alleged.

Cinco vs. Canonoy

90 SCRA 369 (May 31, 1979)

Facts: On Feb 25, 1970, Cinco filed a complaint for recovery of damages on account of a vehicular accident involving his automobile and a jeepney driven by Romeo Hilot and operated by Valeriana Pepito and Carlos Pepito. Subsequently, a criminal case was filed against the driver Romeo Hilot arising from the same accident.

At the pre-trial in the civil case, counsel for private respondents moved to suspend the civil action pending the final determination of the criminal suit invoking Rule 111, Section 3(b) of the Rules of Court, which provides:

“(b) After a criminal action has been commenced, no civil action arising from the same offense can be prosecuted, and the same shall be suspended in whatever stage it may be found, unitl final judgment in the criminal proceeding has been rendered.”

The City Court of Mandaue ordered the suspension of the civil case.

Issue: Whether or not there can be an independent civil action for damage to property during the pendency of the criminal action.

Held: Yes, the civil suit for damages brought by the petitioner is based on quasi-delict predicated on Articles 2176 and 2180 of the Civil Code. Thus, the civil case may proceed as a

s eparate and independent civil action:

“Art. 2177. Responsibility for fault or negligence under the preceding article is entirely separate and distinct from the civil liability arising from negligence under the Penal code. But the plaintiff cannot recover damages twice for the same act or omission of the defendant.”

The separate and independent civil action for quasi-delict is also clearly recognized in sec 2, Rule 111 of the Rules of Court:

Sec 2. Independent civil action. – In the cases provided for in Articles 31, 32, 33, 34 and 2177 of the Civil Code of the Philippines, an independent civil action entirely separate and d istinct from the criminal action, may be brought by the injured party during the pendency of the criminal case, provided the right is reserved as required in the preceding section. Such civil action shall proceed independently of the criminal prosecution, and shall require only a preponderance of evidence.

The civil action referred to in Sections 3(a) and 3(b) of Rule 111 of the Rules of Court, which should be suspended after the criminal action has been instituted, is that arising from the criminal offense not the civil action based on quasi-delict.

Baksh vs. Court of Appeals

G.R. No. 97336 (February 19, 1993)

Facts: Private Respondent Marilou Gonzales filed an action for damages against Gashem Baksh for the alleged violation of their agreement to get married. Gonzales is 22 years old, single, Filipina, a pretty lass of good moral character and has a reputation duly respected in her community; Baksh, on the other hand, is an Iranian citizen and is an exchange student taking a medical course in Dagupan City.

Gonzales alleges that before 20 August 1987, Baksh courted and proposed to marry her. She accepted his love on the condition that they would get married after the end of the school semester. In fact, Baksh visited Gonzalez’ parents in Pangasinan to secure their approval to the marriage. In August 1987, Baksh forced her to live with him in an apartment. According to Gonzales, she was a virgin before she began living with him. A week before the filing of the complaint, Baksh’s attitude towards her started to change. He maltreated and threatened to kill her. During a confrontation in the barangay, Baksh repudiated their marriage agreement and asked her not to live with him anymore, saying further that he is already married to someone else.

Issue: Whether or not a breach of promise to marry is an actionable wrong, thus making Baksh liable for damages.

Held: The existing rule is that a breach of promise to marry is not an actionable wrong per se . This notwithstanding, Article 21 of the Civil Code has expanded the concept of torts or quasi-delict by granting adequate legal remedy for the untold number of moral wrongs which is impossible for human foresight to specifically enumerate and punish in the statute books.

Article 2176 of the Civil Code, which defines a quasi-delict is limited to negligent acts or omissions and excludes the notion of willfulness or intent. In the Philippine legal system, as envisioned by the Commission responsible for drafting the New Civil Code, intentional and malicious acts, with certain exceptions, are to be governed by the Revised Penal Code while negligent acts or omissions are to be covered by Article 2176 of the Civil Code. In between these opposite spectrums are injurious acts which, in the absence of Article 21, would have been beyond redress. Thus, Article 21 fills that vacuum. It is even postulated that together with Articles 19 and 20 of the Civil Code, Article 21 has greatly broadened the scope of the law on civil wrongs; it has become much more supple and adaptable than the Anglo-American law on torts.

Where a man's promise to marry is the proximate cause for the woman to give herself unto him in sexual congress, and there is proof that he had, in reality, no intention of marrying her and that the promise was only a subtle scheme or deceptive device to obtain her consent to the sexual act, the award of damages pursuant to Article 21 is in order. The court took notice that Gonzales’ is an innocent barrio lass and a typical Filipina, who under our customs would not have gave in to sexual congress with Baksh much more lived-in with him, were it not for his promise to marry.

Dulay vs. Court of Appeals

243 SCRA 220 (1995) [see infra]

Facts: An altercation between Benigno Torzuela and Atty. Napoleon Dulay occurred at the “Big Bang sa Alabang,” Alabang Village, Muntinlupa, in which Torzuela, a security guard in the said carnival shot and killed Atty. Dulay with a .38 caliber revolver belonging to Torzuela’s security agency. Petitioner Maria Benita Dulay, widow of the deceased Atty. Dulay filed an action for damages against Torzuela and SAFEGUARD and/or SUPERGUARD security agency, which were impleaded as alternative defendants being the employer/s of Torzuela. Petitioner Dulay alleged in her complaint that “the incident resulting in the death of Atty. Dulay was due to the concurring negligence of the defendants, Torzuela’s wanton and reckless discharge of the firearm issued to him by defendant SAFEGUARD and/or SUPERGUARD”

SUPERGUARD filed a motion to dismiss claiming that Torzuela’s act of shooting was beyond the scope of his duties and that the alleged act of shooting was committed with deliberate intent (dolo), and therefore, the civil liability is governed by the Art. 100 of the Revised Penal Code:

Art. 100. Civil liability of a person guilty of a felony. - Every person criminally liable for a felony is also civilly liable.

SUPERGUARD alleged that the complaint for damages based on negligence under Article 2176 of the Civil Code, could not lie, since the civil liability under Art. 2176 applies only to quasi-offenses under Art. 365 of the RPC. The RTC upheld the arguments of SAFEGUARD. Thus in their appeal, the Dulays allege that: “without stating the facts showing such negligence are mere conclusions of law…x x x…Respondent judge also declared that the complaint was one for damages founded on crimes punishable under Art.100 &103, RPC as

distinguished from those arising from quasi-delict.” The CA affirmed the decision of the lower court, hence, the appeal before the Supreme Court.

Issue: WON, Article 2176 covers only acts of negligence

HELD: No. Contrary to the theory of SAFEGUARD, there is no justification for limiting the scope of Article 2176 of the Civil Code to acts or omissions resulting from negligence. Well-entrenched is the doctrine that article 2176 covers not only acts committed with negligence, but also those which are voluntary and intentional. ‘fault or negligence’, under the article covers not only acts criminal in character, whether intentional and voluntary or negligent”.

Damage, Damages, Injury

People vs. Ballesteros

285 SCRA 438 (January 29, 1998)

Facts: Carmelo Agliam, his half-brother Eduardo and Ronnel Tolentino along with Vidal Agliam, his brother Jerry Agliam, Robert Cacal, Raymundo Bangi and Marcial Barid went to the barangay hall to attend a dance. The group did not stay long because they sensed some hostility from Cesar Galo and his companions who were giving them dagger looks. The group had barely left when, within fifty meters from the dance hall, their owner jeep was fired upon from the rear. The precipitate attack upon the jeep left two people dead (Eduardo and Jerry) and four others injured.

Based upon the affidavits of Carmelo and Vidal Agliam, warrants for the arrest of Ballesteros, Galo and Bulusan were issued for the crime of double murder with multiple frustrated murder. The trial court found the three accused guilty beyond reasonable doubt of murder, qualified by treachery awarding the heirs of Eduardo and Jerry:

1. Compensatory damages in the amount of PhP50,000.00

2. Moral damages in the amount of PhP20,0000

3. Actual damages in the amount of 61,785.00 (Jerry) & P35,755.00 (Eduardo)

Issue: Whether or not the trial court is correct in the award of damages?

Held: As to moral and to actual damages, yes. As to compensatory damages, no. Damages may be defined as the pecuniary compensation, recompense, or satisfaction for an injury sustained, or as otherwise expressed, the pecuniary consequences, which the law imposes for the breach of some duty or the violation of some right.

Actual or compensatory damages are those awarded in satisfaction of, or in recompense for, loss or injury sustained, whereas moral damages may be invoked when the complainant has experienced mental anguish, serious anxiety, physical suffering, moral shock and so forth, and had furthermore shown that these were the proximate result of the offender's wrongful act or omission.

Before actual or compensatory damages could be granted, the party making a claim for such must present the best evidence available, viz., receipts, vouchers, and the like, as corroborated by his testimony. Here, the claim for actual damages by the heirs of the victims is not controverted, the same having been fully substantiated by receipts accumulated by them and presented to the court. Therefore, the award of actual damages is proper.

However, the order granting compensatory damages to the heirs of Jerry Agliam and Eduardo Tolentino Sr. must be amended. Consistent with the policy of this Court, the amount of f ifty thousand pesos (P50,000.00) is given to the heirs of the victims by way of indemnity, and not as compensatory damages. As regards moral damages, the trial court in its discretion may determine the amount of psychological pain, damage and injury caused to the heirs of the victims, although inestimable. Hence, we see no reason to disturb its findings as to this matter.

Custodio vs. Court of Appeals

253 SCRA 483 (February 9, 1996)

Facts: Mabasa bought a parcel of land with an apartment in Interior P. Burgos St., Taguig, Metro Manila. There were tenants occupying the apartment at the time of purchase. Taking P. Burgos St. as the point of reference, on the left side going to Mabasa’s apartment, the row of houses are as follows: That of Custodio, then of Santos, then that of Mabasa. On the right side is that of Morato and a septic tank. The first passageway from the apartment to P. Burgos St. is through these houses. The second passageway goes through the septic tank, with a width of less than 1 meter.

Sometime later, one of the apartment’s tenants vacated it. Mabasa checked the premises and saw that the Santoses built an adobe fence, making the first passageway narrower. Morato also built an adobe fence in such a way that the entire passageway was enclosed. Then the remaining tenants vacated the area. Santos claimed that she built the fence because of an incident involving her daughter and a passing bicycle. She also mentioned that some drunk tenants would bang their doors and windows. The RTC granted a right of way and damages

in favor of Custodio and the Santoses. The CA modified it, ordering an award of damages to Mabasa. Custodio questioned the right of way and award of damages in the SC.

Issue: Whether or Not the award of damages is proper.

Held: Firstly, the Custodios are barred from questioning the grant of the right of way, because they failed to appeal the decision. The decision has become final. As to the award of damages, the CA erred in awarding damages in favor of private respondents Mabasa. The mere fact that Mabasa suffered losses does not give rise to a right to recover damages. To warrant the recovery of damages, there must be both a right of action for a legal wrong inflicted by Custodio, and damage resulting to Mabasa. Wrong without damage, or damage without wrong does not constitute a cause of action, since damages are merely part of the remedy allowed for the injury caused by a breach or wrong. In the case at bar, there were no p revious easements existing in favor of Mabasa. The construction of the adobe fence is a natural use and enjoyment of one’s property in a general and ordinary manner. Nobody can complain of being injured here, because the inconvenience arising from said use can be considered as a mere consequence of community life.

Board of Liquidators vs. Heirs of Kalaw

20 SCRA 987 (1967)

Facts: Maximo Kalaw was a general manager and chairman of the board of NACOCO (National Coconut Corp.) Defendant Juan Bocar and Garcia were members of Board. After the passage of a law that empowers NACOCO to buy, sell, barter, export their products, NACOCO embarked on Copra trading Activities. Kalaw executed contracts. However, due to the typhoons, the copra industry was affected, resulting to impending financial losses on the contracts executed by Kalaw. A meeting was held with the board of directors and the disclosure of the impending loss was communicated to the members but no action was taken thereafter.

Some of the buyer like Louis Dreyful and Co. filed a suit against the Corporation for damages due to undelivered copra. Settlement was made with the buyer. NACOCO on the other hand seeks recovery from Kalaw and the other directors charging them with negligence under Art 2176 with bad faith or breach of trust for having approved the contracts.

Issue: Whether or not Kalaw is liable for damages.

Held: Kalaw had authority to execute the contracts without need of prior approval due to the nature of his position as general manager. Also, doubts were only thrown when the contracts turned out to be unprofitable for NACOCO.

Rightfully had it been said that bad faith does not simply connote bad judgment or negligence; it imports a dishonest purpose or some moral obliquity and conscious doing of wrong; it means breach of a known duty thru some motive or interest or ill will; it partakes of the nature of fraud. Applying this precept to the given facts herein, we find that there was no "dishonest purpose," or "some moral obliquity," or "conscious doing of wrong," or "breach of a known duty," or "Some motive or interest or ill will" that "partakes of the nature of fraud."

Nor was it even intimated that the NACOCO directors acted for personal reasons, or to serve their own private interests, or to pocket money at the expense of the corporation. As the trial court correctly observed, this is a case of damnum absque injuria. Conjunction of damage and wrong is absent. There cannot be an actionable wrong if either one or the other is wanting.

Custodio vs. Court of Appeals

253 SCRA 483 (February 9, 1996)

Held: The mere fact that the plaintiff suffered losses does not give rise to a right to recover damages. To warrant the recovery of damages, there must be both a right of action for a legal wrong inflicted by the defendant, and damage resulting to the plaintiff therefrom. Wrong without damage, or damage without wrong, does not constitute a cause of action, since damages are merely part of the remedy allowed for the injury caused by a breach or wrong.

There is a material distinction between damages and injury. Injury is the illegal invasion of a legal right; damage is the loss, hurt, or harm which results from the injury; and damages are the recompense or compensation awarded for the damage suffered. Thus, there can be damage without injury in those instances in which the loss or harm was not the result of a violation of a legal duty. These situations are often called damnum absque injuria.

In order that a plaintiff may maintain an action for the injuries of which he complains, he must establish that such injuries resulted from a breach of duty which the defendant owed to the plaintiff a concurrence of injury to the plaintiff and legal responsibility by the person causing it. The underlying basis for the award of tort damages is the premise that an individual was injured in contemplation of law. Thus, there must first be the breach of some duty and the imposition of liability for that breach before damages may be awarded; it is not sufficient to state that there should be tort liability merely because the plaintiff suffered some pain and suffering.

Many accidents occur and many injuries are inflicted by acts or omissions which cause damage or loss to another but which violate no legal duty to such other person, and consequently create no cause of action in his favor. In such cases, the consequences must be borne by the injured person alone. The law affords no remedy for damages resulting from an act which does not amount to a legal injury or wrong.

In other words, in order that the law will give redress for an act causing damage, that act must be not only hurtful, but wrongful. There must be damnum et injuria. If, as may happen in many cases, a person sustains actual damage, that is, harm or loss to his person or property, without sustaining any legal injury, that is, an act or omission which the law does not deem an injury, the damage is regarded as damnum absque injuria.

In the case at bar, although there was damage, there was no legal injury. Contrary to the claim of private respondents, petitioners could not be said to have violated the principle of abuse of right. In order that the principle of abuse of right provided in Article 21 of the Civil Code can be applied, it is essential that the following requisites concur: (1) The defendant should have acted in a manner that is contrary to morals, good customs or public policy; (2) The acts should be willful; and (3) There was damage or injury to the plaintiff.

Art. 2176 of the Civil Code

Garcia vs. Florido

G.R.No. L-35095 (August 31,1973)

Facts: Petitioners German C. Garcia, his wife, Luminosa L. Garcia, and Ester Francisco, boarded a public utility car owned and operated by respondent, Marcelino Inesin, and driven by respondent, Ricardo Vayson, for a round-trip from Oroquieta City to Zamboanga City. While the car was negotiating a slight curve on the national highway, it collided with an oncoming passenger bus owned and operated by the Mactan Transit Co., Inc. and driven by defendant, Pedro Tumala. As a result of the collision, petitioners sustained various physical injuries which necessitated medical treatment and hospitalization.

Petitioners filed for damages against the private respondents, owners and drivers, respectively, of the public utility car and the passenger bus.Marcelino Inesin and Ricardo Vayson filed their answer admitting the contract of carriage with petitioners but alleged, by way of defense, that the accident was due to the negligence and reckless imprudence of the bus driver.

Respondents, Mactan Transit Co., Inc. and Pedro Tumala, filed a motion to dismiss arguing that the petitioners had no cause of action for on August 11, 1971, or 20 days before the filing of the present action for damages, respondent Pedro Tumala was charged in a criminal case already for "double serious and less serious physical injuries through reckless imprudence," by the Chief of Police. Hence, with the filing of the criminal case, no civil action could be filed subsequent thereto unless the criminal case has been finally adjudicated. Therefore, the filing of the instant civil action is premature, because the liability of the employer is merely subsidiary and does not arise until after final judgment has been rendered finding the driver, Pedro Tumala, guilty of negligence.

Issue: Whether or not the petitioners may recover damages under a separate and independent action while a criminal case is pending.

Held: Yes. Petitioners may recover damages for liability arising from quasi-delict. Under Sec. 2 in relation to Sec. I of Rule III of the Revised Rules of Court, in the cases provided for by Articles 31, 33, 39 and 2177 of the Civil Code, an independent civil action entirely separate and distinct from the civil action, may be instituted by the injured party during the pendency of the criminal case, provided said party has reserved his right to institute it separately. But it should be noted, however, that neither Sec. 1 nor Sec. 2 of Rule 111 fixes a time limit when such reservation shall be made.

In the case at bar, there is no question that petitioners never intervened in the criminal action instituted by the Chief of Police against respondent Pedro Tumala, much less has the said criminal action been terminated either by conviction or acquittal of the accused. Petitioners have two options from where they could recover damages from—that arising out of the criminal act, and that under quasi-delict. Petitioners opted to recover damages under quasi-delict, which in effect operated as their abandonment of their claim to damages under the pending criminal case. Therefore, petitioners may still recover damages from their civil action against the defendants.

Andamo vs. Court of Appeals

191 SCRA 195 (November 6, 1990)

Facts: Petitioner-spouses Emmanuel and Natividad Andamo are the owners of a parcel of land situated in Biga (Biluso) Silang, Cavite which is adjacent to that of private respondent, Missionaries of Our Lady of La Salette, Inc., a religious corporation.

Within the land of respondent corporation, waterpaths and contrivances (including an artificial lake) were constructed, which allegedly inundated and eroded petitioners' land; caused a young man to drown; damaged petitioners' crops and plants; washed away costly fences; endangered the lives of petitioners and their laborers during rainy and stormy seasons; and exposed plants and other improvements to destruction.

Issue: Whether or not a corporation, which has built waterpaths, water conductors and contrivances within its land, thereby causing inundation and damage to an adjacent land, can be held civilly liable for damages under Articles 2176 and 2177 of the Civil Code on quasi-delicts.

Held: A careful examination of the complaint shows that the action is one under Articles 2176 and 2177 of the Civil Code on quasi-delicts. All the elements of a quasi-delict are present, to wit: (a) damages suffered by the plaintiff, (b) fault or negligence of the defendant, or some other person for whose acts he must respond; and (c) the connection of cause and effect between the fault or negligence of the defendant and the damages incurred by the plaintiff.

Clearly, the waterpaths and contrivances built by respondent corporation are alleged to have inundated the land of petitioners. There is therefore, an assertion of a causal connection between the act of building these waterpaths and the damage sustained by petitioners. Such action, if proven, constitutes fault or negligence which may be the basis for the

recovery of damages.

It must be stressed that the use of one's property is not without limitations. Article 431 of the Civil Code provides that "the owner of a thing cannot make use thereof in such a manner as to injure the rights of a third person." SIC UTERE TUO UT ALIENUM NON LAEDAS. Moreover, adjoining landowners have mutual and reciprocal duties which require that each must use his own land in a reasonable manner so as not to infringe upon the rights and interests of others. Although we recognize the right of an owner to build structures on his land, such structures must be so constructed and maintained using all reasonable care so that they cannot be dangerous to adjoining landowners and can withstand the usual and expected forces of nature. If the structures cause injury or damage to an adjoining landowner or a third person, the latter can claim indemnification for the injury or damage suffered.

Taylor vs. Manila Electric Railroad and Light Co.

16 Phil 8 (March 22, 1910)

Facts: Defendant Manila Electric left some twenty or thirty fulminating caps used for blasting charges of dynamite scattered in the premises behind its power plant. Fifteen year old David Taylor is a son of a mechanical engineer. Two years before the incident David spent four months at sea, as a cabin boy on an interisland transports. Later he took up work in his father's office, learning mechanical drawing and mechanical engineering. It appears that he was a boy of more than average intelligence, taller and more mature both mentally and physically than most boys his age.

David, along with Manuel, a 12 year old, entered the premises of the defendant without permission. While playing, the boys saw the fulminating caps, picked some pieces and brought them home. In the presence of Jessie, a 9 year old girl , The two boys made a series of experiments with the caps. They thrust the ends of the wires into an electric light socket and obtained no result. Next, they tried to break the cap with a stone and failed. They then opened one of the caps with a knife, and finding that it was filled with a yellowish substance they got matches, and the plaintiff held the cap while the other boy applied a lighted match to the contents. An explosion followed causing injuries to the boys and to Jesse. This action was brought by the plaintiff, through his father, to recover damages for the injuries which he suffered.

Issue: Whether or not the company was liable for the injury sustained by plaintiff.

Held: The Supreme Court held that under the circumstances, the negligence of the defendant of leaving the caps exposed on its premises was not the proximate cause of the injury. When the immediate cause of an accident resulting in an injury is the plaintiff’s own acts, he cannot recover damages for the injury.

The immediate cause of the explosion, which resulted in plaintiff’s injury, was his own act in putting a match to the contents of the cap. True, David Taylor may not have known and probably did not know the precise nature of the explosion which might be expected from the ignition of the contents of the cap, and of course he did not anticipate the resultant injuries which he incurred, but he well knew that a more or less dangerous explosion might be expected from his act, and yet he willfully, recklessly, and knowingly produced the explosion

We are satisfied that the plaintiff in this case had sufficient capacity and understanding to be sensible of the danger to which he exposed himself when he put the match to the contents of the cap; that his age and his experience qualified him to understand the necessity for the exercise of that degree of caution which would have avoided the injury which resulted from his own deliberate act; and that the injury incurred by him must be held to have been the direct and immediate result of his own willful and reckless act, so that while it may be true that these injuries would not have been incurred but for the negligence of the defendant in leaving the caps exposed on its premises, nevertheless plaintiff's own act was the proximate and principal cause of the accident which inflicted the injury

NOTE for undergraduates: Read the analysis of US turn-table case in the original.

Tayag vs. Alcantara

98 SCRA 723 (July 23, 1980)

Facts: The Heirs of Tayag filed a complaint for damages against Phil Rabbit Bus lines alleging among others that Pedro Tayag Sr. was riding on a bicycle along McArthur highway on his way home. He was hit by the bus driven by Villa which caused his death.

Philippine Rabbit filed motion to suspend trial on the ground that criminal case against Villa was still pending. When Villa was acquitted on the ground of reasonable doubt, Philippine Rabbit filed a motion to dismiss the civil case. The heirs opposed alleging that their cause of action is not based on crime but on quasi-delict. The Judge indeed dismissed the case, hence, this appeal.

Issue: Whether or not the acquittal of Villa in the criminal case will result to the dismissal of the civil case based on quasi-delict.

Held: No. The acquittal of the driver of the crime charged is not a bar to the prosecution for damages based on quasi-delict. Article 31 of the Civil Code provides:

When the civil action is based on an obligation not arising from the act or commission complained of as a felony, such civil action may proceed independently of the criminal proceedings and regardless of the result of the latter.

Evidently, the above quoted provision refers to a civil action based, not on the act or omission charged as a felony in a criminal case, but one based on an obligation arising from other sources, like quasi delict. In the case at bar, the allegations of the complaint clearly show that petitioners' cause of action was based upon a quasi-delict, to wit:

That the Philippine Rabbit Bus ... was at the time of the accident being driven by defendant Romeo Villa y Cunanan in a faster and greater speed than what was reasonable and proper and in a gray negligent, careless, reckless and imprudent manner, without due regards to injuries to persons and damage to properties and in violation of traffic rules and regulation.

That defendant Philippine Rabbit Bus Lines Inc. has failed to exercise the diligence of a good father of a family in the selection and supervision of its employees, particularly defendant Romeo Villa y Cunanan otherwise the accident in question which resulted in the death of Pedro Tayag, Sr. and damage to his property would not have occurred.

The essential averments for a quasi delictual action are present, namely: (1) an act or omission constituting fault or negligence on the part of private respondent; (2) damage caused by the said act or commission; (3) direct causal relation between the damage and the act or commission; and (4) no pre-existing contractual relation between the parties.\

Quasi Delict vs. Delict

Barredo vs. Garcia- Art. 2177 Discussion

73 Phil 607 (July 8, 1942)

Facts:(Supra)

Issue: Whether or not plaintiffs may bring this separate civil action against Fausto Barredo, making him primarily and directly, responsible under article 1903 of the Civil Code as an employer of Pedro Fontanilla.

Held: Authorities support the proposition that a quasi-delict or "culpa aquiliana " is a separate legal institution under the Civil Code with a substantivity all its own, and individuality that is entirely apart and independent from delict or crime. Upon this principle and on the wording and spirit article 1903 of the Civil Code, the primary and direct responsibility of employers may be safely anchored.

Some of the differences between crimes under the Penal Code and the culpa aquiliana or cuasi-delito under the Civil Code are:

1. That crimes affect the public interest, while cuasi-delitos are only of private concern.

2. That, consequently, the Penal Code punishes or corrects the criminal act, while the Civil Code, by means of indemnification, merely repairs the damage.

3. That delicts are not as broad as quasi-delicts, because the former are punished only if there is a penal law clearly covering them, while the latter, cuasi-delitos, include all acts in which "any king of fault or negligence intervenes." However, it should be noted that not all violations of the penal law produce civil responsibility, such as begging in contravention of ordinances, violation of the game laws, infraction of the rules of traffic when nobody is hurt.

People vs. Ligon

152 SCRA 39 (July 29, 1987)

Facts: Accused Fernando Gabat was riding a 1978 Volkswagen Kombi owned by his father and driven by the other accused, Rogelio Ligon. While waiting for the traffic light to change, Fernando called a cigarette vendor, Jose Rosales to buy some cigarettes. While the transaction was occurring, the traffic light changed to green, and the car suddenly moved forward. While the car was moving, Rosales was clinging to the window but lost his grip and fell down on the pavement. The bystanders rushed Rosales to PGH where he was treated for multiple physical injuries until his death.

Since Ligon did not stop the car, Castillo, a taxi-driver chased him and sought the assistance of two police officers in an owner-type jeepney. At an intersection, Castillo was able to overtake the car and blocked it, while the jeep pulled up right behind. The police officers drew their guns and told them to alight from the car. They were brought to the police station.

Ligon was then charged with Homicide thru Reckless Imprudence. A charge of robbery with homicide was likewise charged to Ligon and Gabat, since there was an allegation that Gabat forcibly took the cigarette box of the victim. Ligon however was never apprehended after the police released him, so only Gabat was convicted by the RTC. An appeal was then brought to the SC, which ruled that the guilt of the accused was not established beyond reasonable doubt.

Issue: Whether or not accused may be held civilly liable despite the finding of the Court of Appeals that his guilt was not proven beyond reasonable doubt.

Held: Yes. When a person was acquitted of a crime, it does not follow that he is free from civil liability, since only preponderance of evidence is required in a civil action for damages.

The judgment of acquittal can extinguish the civil liability of the accused only when it includes a declaration that the facts from which the civil liability might arise did not e xist. In the instant case, a preponderance of evidence exists sufficient to establish the facts from which the civil liability of Gabat arises. Gabat, by his act and omission with fault and negligence caused damage to Rosales and should answer civilly for the damage done. Gabat’s willful act of calling the victim to the middle of a busy street to buy two sticks of cigarettes set the chain of events which led to the death of the victim. Through fault and negligence, Gabat (1) failed to prevent the driver from moving forward while the purchase was completed;

(2) failed to help the victim while the latter clung precariously to the moving vehicle, and (3) did not enforce his order to the driver to stop. Finally, Gabat acquiesced in the driver’s act of speeding away, instead of stopping and picking up the injured victim.

Padilla vs. Court of Appeals

129 SCRA 558

Facts: Petitioner Roy Padilla, Filomeno Galdones, Pepito Bedena, Yolly Rico, David Bermundo, Villanaoc, Roberto Rosales, Villania, Garrido, Ortega jr., Celestino, “Kamlon” and 14 Ricardo Does was charged of Grave Coercion. On Feb 1964 around 9 am at Camarines Norte, The petitioners willfully and feloniously prevented Antonio Vergara and his family from closing their stall at the Public Market. Petitioners forcibly opened the door of the stall and brutally demolished the stall using axes then carrying away the goods and merchandise. Such acts of the petitioners where said to be pursuant to an ordinance. The damage amounted to 30K for actual damages and 20K for exemplary damages. Roy Padilla and company also took advantage of their public position, being the Mayor of the said municipality and the others being policemen. The CFI finds them guilty. The CA acquitted the accused but ordered them to pay jointly and severally 9,600 as actual damages.

Issue: WON the order of payment for damages is valid notwithstanding the acquittal of the accused.

Held: Yes it is valid. Civil liability is not extinguished where the acquittal is based on reasonable doubt that the accused is guilty of the crime charged. No separate civil action is necessary considering that the facts to be proved in the civil case have already been established in the criminal proceeding. To require a separate civil action would only clod the court dockets and unnecessary duplication of litigation. A separate civil action may be warranted where additional facts have to be established.

Cruz vs. Court of Appeals

282 SCRA 188 (1997)

Facts: Petitioner Dr. Cruz is a surgeon at Perpetual Help Clinic and General Hospital. She examined Lydia and found the latter to have 'myoma' in her uterus, and scheduled her for a hsyterectomy operation. On the day of the operation, Lydia's daughter noticed how untidy the hospital was. She asked that the operation be postponed but Lydia said that Dr. Cruz told her she must be operated as scheduled.

During the operation, Lydia's family was asked to buy tagamet ampules. Later they were asked to buy blood for Lydia at a blood bank. They were again asked to buy blood but the blood bank already ran out of type A. They also saw Lydia gasping for breath as the oxygen supply had ran out so they had to go and buy oxygen for Lydia again. Later that night, Lydia went into shock and her blood pressure dropped to 60/50. Lydia was brought to the San Pablo Hospital however the doctors were not able to save her. She was announced dead at 3:00 AM the following day. Petitioner and her anaesthesiologist were charged with reckless imprudence resulting to homicide. The MTC, RTC, and the CA all found petitioner guilty (anaethesiologist was acquitted) on the ground that the clinic was untidy and they lack the needed facilities like blood and oxygen which are essential for the continuity of the operations they undertake.

Issue: Whether or not the conviction of reckless imprudence resulting to homicide as a consequence of medical malpractice is supported by the evidence on record.

Held: No. The elements of reckless imprudence are: (1) that the offender does or fails to do an act; (2) that the doing or the failure to do that act is voluntary; (3) that it be without malice; (4) that material damage results from the reckless imprudence; and (5) that there is inexcusable lack of precaution on the part of the offender, taking into consideration his employment or occupation, degree of intelligence, physical condition, and other circumstances regarding persons, time and place. The 4th element is lacking in the case at bar.

The material damage was not proved to be the result of the reckless imprudence. In litigations involving medical negligence, the plaintiff has the burden of establishing appellant's negligence and for a reasonable conclusion of negligence, there must be proof of breach of duty on the part of the surgeon as well as a causal connection of such breach and the resulting death of his patient. As shown by the experts presented by both parties, the death of Lydia may have been caused by DIC (clotting defect). Therefore, the cause of death cannot be attributed to petitioner's fault or negligence.

Furthermore, whether or not a physician has committed an "inexcusable lack of precaution" in the treatment of his patient is to be determined according to the standard of care observed by other members of the profession in good standing under similar circumstances bearing in mind the advanced state of the profession at the time of treatment or the present state of medical science. In the case at bar, no physician was asked to testify to show the standard care that needed to be observed given the present circumstances. Therefore, the conviction is not supported by the evidence.

Philippine Rabbit Bus Lines, Inc. vs. People

GR No. 147703 (2004)

Facts: On July 27, 1994, accused Napoleon Roman y Macadangdang was found guilty and convicted of the crime of reckless imprudence resulting to triple homicide, multiple physical injuries and damage to property and was sentenced to imprisonment.

The court further ruled that in the event of insolvency of accused, Philippine Rabbit, as its employer, shall be liable for the civil liabilities of the accused. Evidently, the judgment against the accused had become final and executory. Admittedly, accused jumped bail and remained at-large. It is worth mentioning that Section 8, rule 124 of the Rules of Court authorizes the dismissal of appeal when appellant jumps bail.

ISSUE: Whether or not an employer, who dutifully participated in the defense of its accused-employee, may appeal the judgment of conviction independently of the accused.

HELD: No. The accused cannot be accorded the right to appeal unless they voluntarily submit to the jurisdiction of the court or are otherwise arrested within 15 days from notice of the judgment against them. While at large, they cannot seek relief from the court, as they are deemed to have waived the appeal. In the case before us, the accused-employee has escaped and refused to surrender to the proper authorities; thus, he is deemed to have abandoned his appeal. Consequently, the judgment against him has become final and executory.

Petitioner admits helping the accused employee, hence, it participated in the proceedings before the RTC; thus, it cannot be said that the employer was deprived of due process.

It might have lost its right to appeal, but it was not denied its day in court.

Under Article 103 of the Revised Penal Code, employers are subsidiarily liable for the civil liabilities of their employees in the event of the latter’s insolvency. To allow employers to dispute the civil liability fixed in a criminal case would enable them to amend, nullify or defeat a final judgment rendered by a competent court.

By the same token, to allow them to appeal the final criminal conviction of their employees without the latter’s consent would also result in improperly amending, nullifying or defeating the judgment. The decision convicting an employee in a criminal case is binding and conclusive upon the employer not only with respect to the former’s civil liability, but also with as to its amount. The liability of an employer cannot be separated from that of the employee.

Quasi-delict vs. Breach of Contract

Cangco vs. Manila Railroad Co.

38 Phil 768 (October 14, 1918)

Facts: Jose Cangco, was in the employment of Manila Railroad Company in the capacity of clerk. He lived in the pueblo of San Mateo, Rizal, which is located upon the line of the defendant railroad company. Everyday, he comes by train to the company's office in the city of Manila where he works and he uses a pass, supplied by the company, which entitles him to ride the trains free of charge.

One day, Jose Cangco stepped off the train, but one or both of his feet came in contact with a sack of watermelons causing his feet to slip making him fell violently on the platform. His body rolled from the platform and was drawn under the moving car, where his right arm was badly crushed and lacerated. It appears that after the plaintiff alighted from the train the car moved forward possibly six meters before it came to a full stop.

Cangco was drawn from under the car in an unconscious condition, and it appeared that the injuries he had received were very serious. He was brought at once to hospital in the city of Manila where an examination was made and his arm was amputated.

He instituted this proceeding in the Court of First Instance of the city of Manila to recover damages from the defendant company. His action is founded upon the negligence of the servants and employees of the defendant in placing the sacks of melons upon the platform and leaving them so placed as to be a menace to the security of passenger alighting from the trains. The trial judge concluded that, although negligence was attributable to the defendant by reason of the fact that the sacks of melons were so placed as to obstruct passengers passing to and from the cars, nevertheless, the plaintiff himself had failed to use due caution in alighting from the coach and was therefore precluded from recovering. Judgment was accordingly entered in favor of the defendant company, and the plaintiff appealed.

Issues:

1. Whether or not Manila Railroad can excuse its liability upon the ground that the breach was due to the negligence of their servant.

2. Whether Cango is negligent when he alight from the moving train.

Held: (1) No. Failure to perform a contract cannot be excused upon the ground that the breach was due to the negligence of a servant of the obligor, and that the latter exercised due diligence in the selection and control of the servant. It cannot be doubted that the employees of the railroad company were guilty of negligence in piling these sacks on the platform in the manner above stated; that their presence caused the plaintiff to fall as he alighted from the train; and that they therefore constituted an effective legal cause of the injuries sustained by the plaintiff. It necessarily follows that the defendant company is liable for the damage thereby occasioned unless recovery is barred by the plaintiff's own contributory negligence. In resolving this problem it is necessary that each of these conceptions of liability, to-wit, the primary responsibility of the defendant company and the contributory negligence of the plaintiff should be separately examined.

It is important to note that the foundation of the legal liability of the defendant is the contract of carriage, and that the obligation to respond for the damage which plaintiff has suffered arises, if at all, from the breach of that contract by reason of the failure of defendant to exercise due care in its performance. That is to say, its liability is direct and immediate, differing essentially, in legal viewpoint from that presumptive responsibility for the negligence of its servants, imposed by article 1903 of the Civil Code, which can be rebutted by proof of the exercise of due care in their selection and supervision. Article 1903 of the Civil Code is not applicable to obligations arising ex contractu, but only to extra-contractual obligations or to use the technical form of expression, that article relates only to culpa aquiliana and not to culpa contractual.

(2) No. it is not negligence per se for a traveler to alight from a slowly moving train. As pertinent to the question of contributory negligence on the part of the plaintiff in this case the following circumstances are to be noted: The company's platform was constructed upon a level higher than that of the roadbed and the surrounding ground. The distance from the steps of the car to the spot where the alighting passenger would place his feet on the platform was thus reduced, thereby decreasing the risk incident to stepping off. The nature of the platform, constructed as it was of cement material, also assured to the passenger a stable and even surface on which to alight.

Furthermore, the plaintiff was possessed of the vigor and agility of young manhood, and it was by no means so risky for him to get off while the train was yet moving as the same act would have been in an aged or feeble person. In determining the question of contributory negligence in performing such act that is to say, whether the passenger acted prudently or recklessly the age, sex, and physical condition of the passenger are circumstances necessarily affecting the safety of the passenger, and should be considered.

Again, it may be noted that the place was perfectly familiar to the plaintiff as it was his daily custom to get on and of the train at this station. There could, therefore, be no uncertainty in his mind with regard either to the length of the step, which he was required to take, or the character of the platform where he was alighting. Our conclusion is that the conduct of the plaintiff in undertaking to alight while the train was yet slightly under way was not characterized by imprudence and that therefore he was not guilty of contributory negligence.

Fores vs. Miranda

105 Phil 266 (March 4, 1959)

Facts: Miranda was riding a jeepney driven by Luga. While the vehicle was descending Sta. Mesa bridge at high speed, the driver lost control. It swerved and hit the bridge wall, resulting to injuries to the passengers and Miranda. Miranda broke some bones in his right arm. The driver was charged with serious physical injuries through reckless imprudence, pleaded guilty, and was sentenced accordingly. Fores, owner of the jeepney, claimed that one day before the accident, she sold the vehicle to a certain Sackerman. In the meantime, Miranda prays for moral damages.

Issues:

1. Whether or not approval of the Public Service Commission is necessary for the sale of a public service vehicle even without conveying therewith the authority to operate the same.

2. Whether or not an award for damages is proper.

Held: While the sale, without the required approval, is still valid and binding between the parties, approval of the Public Service Commission is necessary for such sale, as provided for by Sec. 20 of the Public Service Act (Commonwealth Act 146).

As to the second issue, the award of moral damages is not proper. It has been held that moral damages are not recoverable in damage actions predicated on a breach of contract of transportation, in view of Art. 2219 and 2220 of the new Civil Code:

ART 2219. Moral damages may be recovered in the following analogous cases:

1. a criminal offense resulting in physical injuries

2. quasi delicts causing physical injuries

ART. 2220. Willfull injury to property may be a legal ground for awarding moral damages if the court should find that, under the circumstances, such damages are justly due. The same rule applies to breaches of contract where the defendant acted fraudulently or in bad faith.

The exceptional rule in Article 1764 provides that where the injured passenger does not die, moral damages are not recoverable unless it is proved that the carrier was guilty of malice or bad faith. T he mere carelessness of the carrier’s driver does not per se constitute or justify an inference of malice or bad faith on the part of the carrier, as in the case at bar.

In the absence of statutory provision, it is presumed that the lawmakers intended in article 2220 to limit recovery of moral damages to breaches of contract in bad faith. The fact that negligence may be so gross as to amount to malice, must be shown in evidence, and a carrier’s bad faith is not to be lightly inferred from a mere finding that the contract was breached though negligence of the carrier’s employees. The award for moral damages is eliminated.

Far East Bank and Trust Company vs. Court of Appeals

241 SCRA 671 (February 23, 1995)

Facts: Private respondent Luis Luna applied for and was accorded a Fareastcard issued by petitioner FEBTC. Upon his request, a supplemental card was issued to Clarita Luna. In August 1988, Clarita lost her card and FEBTC was forthwith informed. Due to bank policy, petitioner recorded the lost card, along with the principal card as a “hot card” or a “cancelled card”. In October, Luis used his card to pay for lunch at the Hotel Intercontinental Manila. However, after verifying with the bank, the card was not honored and Luis had to pay cash. He was embarrassed by this incident. Luis, through counsel, wrote to petitioner and asked for the payment of damages. The VP of the bank wrote a letter to Luis and expressed his apologies in their failure to inform the latter of the bank's security policy. Also, the VP sent a letter to the hotel to assure the latter that the private respondents were very valued clients. Still feeling aggrieved, private respondent filed a complaint for damages in the RTC. The RTC ruled in their favor and ordered FEBTC to pay moral and exemplary damages. CA affirmed the said decision.

Issue: Whether or not the award of damages is proper.

Held: NO. In culpa contractual, moral damages may be recovered where the defendant is shown to have acted in bad faith or with malice in the breach of contract. (Art. 2220 NCC) While it is true that the bank was remiss in neglecting to personally inform Luis of his own card's cancellation, there is no finding that there was deliberate intent on the part of FEBTC to cause harm to Luis. Neither could FEBTC's negligence in failing to give personal notice to Luis be considered so gross as to amount to malice or bad faith.

Malice or bad faith implies a conscious and intentional design to do a wrongful act for a dishonest purpose or moral obliquity; it is different from the negative idea of negligence in that malice or bad faith contemplates a state of mind affirmatively operating with furtive design or ill will. Thus, the award of moral damages is inordinate and substantially devoid of legal basis.

Exemplary or corrective damages are awarded, in the case of quasi-delicts, if the defendant is shown to have been so guilty of gross negligence as to approximate malice. And in case of contracts and quasi-contracts, it is awarded when the defendant is found to have acted in a wanton, fraudulent, reckless, oppressive or malevolent manner. Thus, the award of exemplary damages is improper.

NEVERTHELESS, the bank's failure to honor its credit card issued to Luis should entitle him to recover a measure of damages sanctioned under Article 2221 of the Civil Code:

Art. 2221. Nominal damages are adjudicated in order that a right of the plaintiff, which has been violated or invaded by the defendant, may be vindicated or recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered by him.

Air France vs. Carrascoso

G.R. No. L-21438 September 28, 1966

Facts: Plaintiff Carrascoso, a civil engineer, was a member of a group of 48 Filipino pilgrims that left Manila for Lourdes. Air France, through its authorized agent, Philippine Air Lines, Inc., issued to plaintiff a ‘first class’ round trip airplane ticket from Manila to Rome. From Manila to Bangkok, plaintiff travelled in ‘first class’, but at Bangkok, the Manager of the defendant airline forced plaintiff to vacate the ‘first class’ seat that he was occupying because, in the words of the witness Ernesto G. Cuento, there was a ‘white man’ who, the Manager alleged had a better right to the seat. When asked to vacate his ‘first class’ seat, the plaintiff refused, and told defendant’s Manager that his seat would be taken over his dead body. A commotion ensued, and, according to said Ernnesto G. Cuento, many of the Filipino passengers got nervous in the tourist class; when they found out that Mr. Casrrascoso was having a hot discussion with the white man [manager], they came all across to Mr. Carrascoso and pacified Mr. Carrascoso to give his seat to the ‘white man’ and plaintiff reluctantly gave his ‘first class’ seat in the plane.

Carrascoso filed a case for damages. The CFI of Manila sentenced Air France to pay rCarrascoso P25,000.00 by way of moral damages; P10,000 as exemplary damages; P393.20 representing the difference in fare between first class and tourist class for the portion of the trip Bangkok-Rome. The CA slightly reduced the amount of refund on Carrascos’s plane ticket.

Issue: WON Carrascoso’s action is planted upon breach of contract, with the existence of bad faith, entitling him to the award of damages.

Held: There was a contract to furnish plaintiff a first class passage covering, amongst others, the Bangkok-Teheran leg. The said contract was breached when petitioner failed to furnish first class transportation at Bangkok.

The evidence shows that defendant violated its contract of transportation with plaintiff in bad faith, with the aggravating circumstances that defendant’s Manager in Bangkok went to the extent of threatening the plaintiff in the presence of many passengers to have him thrown out of the airplane to give the ‘first class’ seat that he was occupying to, again using the words of witness Ernesto G. Cuento, a ‘white man’ whom he (defendant’s manager) wished to accommodate, and the defendant has not proved that this ‘white man’ had any ‘better right’ to occupy the ‘first class’ seat that the plaintiff was occupying, duly paid for, and for which the corresponding first class ticket was issued.

The responsibility of an employer for the act of its employees need not be essayed. It is well settled in law. For the willful malevolent act of petitioner’s manager, petitioner, his employer, must answer. Article 21 of the Civil Code says:

“ART. 21. Any person who willfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the

damage.”

In parallel circumstances, we applied the foregoing legal percept; and, held upon the provisions of Article 2219 (10), Civil Code, moral damages are recoverable.

Passengers do not contract merely for transportation. They have a right to be treated by the carrier’s employees with kindness, respect, courtesy and due consideration. They are entitled to be protected against personal misconduct, injurious language, indignities and abuses from such employees. So it is, that any rude or discourteous conduct on the part of employees towards a passenger gives the latter an action for damages against the carrier.

Thus, “Where a steamship company had accepted a passenger’s check, it was a breach of contract and tort, giving a right of action for its agent in the presence of third persons to falsely notify her, that the check was worthless and demand payment under threat of ejection; though the language used was not insulting and she was not ejected. Although the relation of passenger and carrier is “contractual both in origin and nature” the act that breaks the contract may also be a tort”. And in another case, “Where a passenger on a rail-road train, when the conductor came to collect his fare, tendered him the cash fare to a point where the train was scheduled not to stop, and told him that as soon as the train reached such point he would pay the cash fare from that point to destination, there was nothing in the conduct of the passenger which justified the conductor in using insulting language to him, as by calling him a lunatic, and the Supreme Court of South Carolina there held the carrier liable for the mental suffering of said passenger.

Petitioner’s contract with Carrascoso, is one attended with public duty. The stress of Carasscoso’s action as we have said, is placed upon his wrongful expulsion. This is a violation of public duty by the petitioner-air carrier-a case of quasi-delict.

Damages are proper. Exemplary damages are well awarded. The Civil Code gives the Court ample to power to grant exemplary damages-in contracts and quasi-contracts. The only condition is that defendant should have “acted in a wanton, fraudulent, reckless, oppressive, or malevolent manner”. The manner of ejectment of respondent Carrascoso from his first class seat fits into this legal precept. And this is in addition to moral damages.

PSBA vs. Court of Appeals

205 SCRA 729 (February 4, 1992)

Facts: Carlito Bautista, a student of PSBA, was stabbed while on the second floor of Philippine School of Business Administration (PSBA) by some elements from outside the school. Carlito died. His parents, filed an action for damages against PSBA and the school authorities (President, Vice-President, Treasurer/Cashier,Chief of Security and Vice Chief of Security). Both the trial court and the CA ruled in favor of parents.

Issue: Whether or not PSBA and the school authorities can be held liable under 2176 and 2180 for quasi-delict.

Held: No. Article 2180 of the Civil Code provides that pupils or students of the educational institution should have caused the damage.

Article 2180, in conjunction with Article 2176 of the Civil Code, establishes the rule of in loco parentis. This Court discussed this doctrine in the cases of Exconde, Mendoza, Palisoc, and more recently, in Amadora vs. CA. In all such cases, it had been stressed that Article 2180 plainly provides that it is the students who must have caused the damage before the educational institution can be held liable for quasi-delict. I n the case at bar, the assailants were not students or pupils of PSBA but were elements from outside the school. Hence, PSBA and its school authorities cannot be held liable under Article 2180.

The circumstances of the present case evince a contractual relation between PSBA and Carlitos Bautista since they entered into a contract the moment Bautista enrolled in the school. There being a contract, the rules on quasi-delict do not really govern. However, should the act which breaches the contract be done in bad faith and be violative of Article 21 as ruled in the Air France case, then there is a cause to view the act as constituting quasi-delict.

In the case at bar however, there is, as yet, no finding that the contract between the school and Bautista had been breached thru the former's negligence in providing security measures. This would be for the trial court to determine. And, even if there be, a finding of negligence, the same could give rise generally to a breach of contractual obligation only. In other words, a contractual relation is a condition sine qua non to the school's liability. The negligence of the school cannot exist independently on the contract, unless the negligence occurs under the circumstances set out in Article 21.

Therefore, PSBA and its school authorities cannot be held liable for quasi-delict under Art. 2180.

Syquia vs. Court of Appeals and Manila Memorial Park and Cemetery, Inc.

217 SCRA 624 (January 27, 1993)

Facts: Juan Syquia, father of deceased and the private respondent executed a Deed of Sale of a memorial lot and an Interment Order, where the private respondent was authorized to bury the remains of the deceased in accordance with its procedures.

Preparatory to transferring the remains to the newly-purchased lot also in Manila Memorial Park, the concrete vault encasing the coffin of the deceased was removed from its niche underground. It was then discovered that said vault has a hole and after one hour or less water drained out of the hole.

Pursuant to the authority granted by the MTC the concrete vault was opened and it was discovered that the interior walls of the concrete vault showed evidence of total flooding and the coffin as well as the clothing and exposed parts of the deceased’s remains were entirely damaged.

A complaint was filed by petitioners (parents and siblings of deceased) for quasi-delict, alleging that there was breach of respondent’s contractual obligation to provide a sealed vault. RTC dismissed the complaint since there was no guarantee in the contract that the vault shall be waterproof and since there was a pre-existing contractual relation defendant cannot be guilty of quasi-delict. The RTC also sustained the explanation given by the private respondent, that the hole had to be bored through the concrete vault because if it has no hole the vault will float and the grave would be filled with water. CA affirmed RTC’s decision hence the instant petition.

Issue: Whether or not the respondent is guilty of quasi-delict.

Held: No. Although a pre-existing contractual relation between the parties does not preclude the existence of a culpa aquiliana, SC find no reason to disregard the respondent's Court finding that there was no negligence. Article 2176 provides that Whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no pre-existing contractual relation between the parties, is called a quasi-delict . The agreement between the parties governed their relations and defined their respective rights and obligations. Hence, had there been actual negligence on the part of the private respondent it would be held liable not for a quasi-delict or culpa aquiliana, but for culpa contractual as provided by Article 1170 of the Civil Code, to wit: Those who in the performance of their obligations are guilty of fraud, negligence, or delay, and those who in any manner contravene the tenor thereof, are liable for damages.

Petitioners claim that the vault provided by private respondent was not sealed, that is, not waterproof. In this regard SC held that there was no stipulation in the Deed of Sale and in the Rules and Regulations of the private respondent that the vault would be waterproof. “Seal" is defined as any of various closures or fastenings that cannot be opened without rupture and that serve as a check against tampering or unauthorized opening." It is therefore clear that "sealed" cannot be equated with "waterproof".

The law defines negligence as the "omission of that diligence which is required by the nature of the obligation and corresponds with the circumstances of the persons, of the time and of the place." In the absence of stipulation or legal provision providing the contrary, the diligence to be observed in the performance of the obligation is that which is expected of a good father of a family. The circumstances surrounding the commission of the assailed act boring of the hole negate the allegation of negligence.

Vicente Calalas vs. Court of Appeals

332 SCRA 356 (2000)

Facts: Eliza G. Sunga, a college freshman at Siliman University, took a passenger jeepney owned and operated by Vicente Calalas. She was given by the conductor an extension seat at the backdoor of the jeepney at the rear end. On their way, the jeepney stopped to let a passenger off. Sunga gave way to the outgoing passengers, just as she was doing so, an Isuzu truck driven by Iglecerio Verena which is owned by Francisco Salva bumped the left rear portion of the jeepney, which injured Sunga.

Sunga then filed action for damages against Calalas for violation of contract of carriage, in failing to exercise the diligence required by him as a common carrier. Calalas, on the other hand filed a third-party complaint against Francisco Salva.

Issue: Whether or not Calalas can blame Francisco Silva as the proximate cause of the loss.

Held: No. There was a contract of carriage between the parties, which was violated, hence, proximate cause is immaterial.

The Supreme Court found Calalas guilty of violating the contract of carriage as a driver failed to transport Sunga safely to her destination, being negligent in (1) not properly parking the jeepney; (2) taking more passengers, than the allowed capacity; and (3) the fact that Sunga was seated in an extension seat placed in a peril greater than that to which the other passengers were exposed.

The determination of the proximate cause of the damage incurred, whether it was the collision between the jeepney and the truck or the negligence of the driver is immaterial. T he doctrine of proximate cause is applicable only in actions of quasi-delict, not in actions involving breach of contract. Where there is a pre-existing contractual relation between parties it is the parties themselves that create the obligation and the law will merely regulate the relation created. (Since there was a contract of carriage here in the case at bar).

Negligence

Picart vs. Smith

37 Phil 809 (March 15, 1918)

Facts: Plaintiff, Picart was riding a pony on Carlatan Bridge, San Fernando. He pulled his pony over the bridge’s railing on the right instead of left upon seeing the automobile rapidly approaching. His pony was unfortunately frightened when the automobile passed so close to them. The horse was struck on the hock of the left hind leg by the flange of the car and the limb was broken. The horse fell and its rider was thrown off with some violence. As a result of its injuries the horse died. Picart received contusions which caused temporary unconsciousness and required medical attention for several days. Picart seeks to render the sum of Php31,000 as damages. CFI- La Union absolved Smith.

Issue: Whether or not defendant was negligent and if the concept of last clear chance is attributable to him?

Held: The defendant Smith is negligent and liable under the doctrine of last clear chance even though the plaintiff was on the wrong side of the bridge. Defendant has had the opportunity to avoid the accident after realizing that the negligence by the plaintiff could not have placed him in a position of better safety.

The last clear chance was passed unto the defendant driving the automobile. It was his duty to bring the car to an immediate stop or upon seeing no other persons were on the bridge to take the other side and pass far away from the pony to avoid collision. Instead of doing this, Smith ran straight on until he was almost upon the horse. When Smith exposed the horse and rider to this danger he was negligent in the eye of the law. Under the circumstances, the law is that the person who has the last clear chance to avoid the impending harm and fails to do is chargeable with the consequences, without reference to the prior negligence of the other party. The existence of negligence in a given case is not determined by reference to the personal judgment of the actor in the situation before him. The law considers what would be reckless, blameworthy, or negligent in the man of ordinary intelligence and prudence and determines liability by that.

The Supreme Court reversed the judgment of the lower court, and rendered judgment that Picart recover of Smith the sum of P200, with costs of both instances. The court held that the sum awarded was estimated to include the value of the horse, medical expenses of Picart, the loss or damage occasioned to articles of his apparel, and lawful interest on the whole to the date of this recovery.

Negligence in special cases (Children)

JARCO Marketing Corporation vs. Court of Appeals and Spouses Aguilar

GR No. 129792 (December 21, 1999)

Facts: Petitioner Jarco is the owner of Syvel's Department Store in Makati City. Respondent spouses are the parents of Zhieneth Aguilar.

On May 9, 1983, Criselda and Zhieneth were at the 2 floor of Syvel's. As Criselda was signing her credit card slip, she felt a sudden gust of wind and heard a loud thud. She

looked behind her and saw her 6 yr. old daughter Zhieneth pinned down on the floor by the store's giftwrapping counter/structure. Zhieneth was crying and screaming for help. She was rushed to the Makati Medical Center and was operated on. The next day, she lost her speech and fourteen days after, she died. The cause of her death was attributed to the injuries she sustained.

Spouses Aguilar demanded upon petitioners the reimbursement of the hospitalization, medical bills, wake and funeral expenses but petitioners refused to pay. Spouses filed a complaint for damages. The trial court dismissed the complaint and ruled that the proximate cause of the fall of the counter on Zhieneth was her act of clinging to it. The court also held that Criselda's negligence in allowing her daughter to freely roam around the store contributed to the accident. In absolving petitioners from liability, the court reasoned that the counter

was situated at the end corner of the 2 floor as a precautionary measure, hencce, it could not be considered as an attractive nuisance.

On appeal, CA reversed the judgment and found that petitioners were negligent in maintaining a structurally dangerous counter. The counter was shaped like an inverted 'L' and it was top heavy and the weight of the upper portion was neither evenly distributed nor supported by its narrow base. It was also established that 2 employees already requested the management to nail the counter because it was shaky but the latter did not take any action. The management insists that it has been there for 15 years and it has been stable. The Court of Appeals also declared that Zhieneth was absolutely incapable of negligence or tort. It also absolved Criselda of any negligence, finding nothing wrong in momentarily allowing Zhieneth to walk while she signed the document. Moreover, the allegation that Zhieneth clung to the counter which caused the same to fall on her was denied by Gonzales in his testimony. He said that when the doctor asked Zhieneth what she did, the child answered 'nothing, i did not come near the counter, the counter just fell on me'. The CA awarded actual and compensatory damages. Petitioners filed a motion for reconsideration but the court denied the same. Hence, this appeal.

Issues:

1. Whether the death of Zhieneth was accidental or attributable to negligence.

2. In case of a finding of negligence, whether the same was attributable to the store management for maintaining a defective counter or to Criselda and Zhieneth for failing to exercise due and reasonable care while inside the store premises.

Held: An accident pertains to a fortuitous circumstance, event or happening; an event happening without any human agency, or if happening wholly or partly through human agency, an event which under the circumstances is unusual or unexpected by the person to whom it happens. On the other hand, negligence is the failure to observe, for the protection of the interest of another person, that degree of care, precaution, and vigilance which the circumstances justly demand, whereby such other person suffers injury. Accident and negligence are intrinsically contradictory; one cannot exist with the other.

The test in determining the existence of negligence is enunciated in the landmark case of PICART V. SMITH, thus: Did the defendant in doing the alleged negligent act use that reasonable care and caution which an ordinarily prudent person would have used in the same situation? If not, then he is guilty of negligence. The court held that Zhieneth's tragedy and death can only be attributed to negligence.

The testimony of Gonzales pertaining to Zhieneth's statement formed part of the res gestae under Section 42, Rule 130 of the Rules of Court. All that is required for their admissibility as part of the res gestae is that they be made or uttered under the influence of a startling event before the declarant had the time to think and concoct a falsehood as witnessed by the person who testified in court. it is unthinkable for a child of tender age and in extreme pain to have lied to a doctor whom she trusted with her life.

Zhieneth performed no act that facilitated her tragic death. However, petitioners did, through their negligence or omission to secure or make stable the counter's base.

Anent the negligence imputed to Zhieneth, the court applied the rule that a child under nine years of age must be conclusively presumed incapable of contributory negligence as a matter of law. And even if contributory negligence can be attributed to Zhieneth and assume that she climbed over the counter, no injury should have occurred if the counter was stable and sturdy. Criselda too, should be absolved from contributory negligence. Zhieneth held on to her mother's hand, Criselda momentarily released the child's hand when she signed her credit card slip. At this precise moment, it was reasonable for Criselda to let go of her child. When the counter fell on her child, Criselda was just one foot away.

Del Rosario vs. Manila Electric Company

57 Phil 478 (November 5, 1932)

Facts: At 2PM in the afternoon, trouble developed in a wire used and operated by Manila Electric Company for the purpose of conducting electricity and lighting the City of Manila and its suburbs. Noguera noticed that the wire was burning and the connections smoking. He then told Soco to telephone the Malabon station of defendant. Soco transmitted the message at

2.25 p.m. and received answer from the station to the effect that they would send an inspector.

At 4 p. m. the neighborhood school was dismissed and the children went home. Among these was Alberto Del Rosario with two of his friends. When they came upon the place where the wire was down, Alberto's friend tried to touch it but was stopped by his other friend, Jose. Alberto, saying he has the habit of touching wires, touched the wire despit Jose's warning, got electrocuted, and was pronounced dead when brought to the hospital.

The parents of Alberto filed for damages against the company. The engineer of the company says that it was customary for the company to make a special inspection of these wires at least once in six months, and that all of the company's inspectors were required in their daily rounds to keep a lookout for trouble of this kind. There is nothing in the record indicating any particular cause for the parting of the wire.

Issue: Whether or not negligence can be imputed to the defendant company, making it liable for damages.

Held: Yes. The Court is of the opinion that the presumption of negligence on the part of the company from the breakage of this wire has not been overcome, and the defendant is responsible for the accident. Furthermore, when notice was received at the Malabon station at 2.25 p. m., somebody should have been dispatched to the scene of the trouble at once, or other measures taken to guard the point of danger; but more than an hour and a half passed before anyone representing the company appeared on the scene, and in the meantime this child had been claimed as a victim.

It is doubtful whether contributory negligence can properly be imputed to the deceased, owing to his immature years and the natural curiosity as a 9-year-old boy. The fact that he ignored the warnings of his friend does not alter the case.

The Court therefore awards P1000 as general damages for loss of service and P250 for expenses incurred for the death and burial of the boy.

Ylarde vs. Aquino

163 SCRA 697 (July 29, 1988)

Facts: Private respondent Soriano was the principal of the Gabaldon Primary School, a public school in Tayug, Pangasinan, while Private respondent Aquino was a teacher therein. During the happening of the events which led to the filing of the case, there were several concrete blocks in the school which were remnants of the old school shop that was destroyed in World War II. Realizing that the huge stones were serious hazards to the schoolchildren, Sergio Banez, also a teacher therein, started burying them. Aquino, in order to help, gathered eighteen of his male pupils after class and ordered them to dig an excavation pit wherein the stone can be buried. It was continued the following day by four of the original eighteen pupils. Among them is the son of the petitioners, Novelito. When the depth was right enough to accommodate the concrete block, Aquino and his pupils got out of the hole. Aquino left to borrow a key to the workroom from Banez to get a rope, he instructed the pupils not to touch the stone. Three of the four kids, including Novelito, playfully jumped into the pit. The other kid, without any warning jumped on top of the concrete block causing it to slide down towards the opening.

Except for Novelito, the other kids were able to go out of the pit. The concrete block pinned Novelito to the wall in a standing position. As a result thereof, he sustained injuries. Novelito died 3 days after. Petitioner-parents filed a suit for damages against both private respondents. Petitioners base their action against Aquino on Article 2176 NCC for his alleged negligence that caused their son's death while the complaint against Soriano as the head of school is founded on Article 2180 NCC. The lower court dismissed the complaint on the following grounds: (1) that the digging done by the pupils is in line with their course called Work Education; (2) that Aquino exercised the utmost diligence of a very cautious person; and (3) that the demise of Novelito was due to his own reckless imprudence. This was affirmed by CA on appeal. Hence the present petition.

Issues: (1)Whether or not Soriano is liable for damages under Art. 2180. (2) Whether or not Aquino is liable for damages under Art. 2176.

Held: 1. No. The Court based their ruling on the doctrine enunciated in the case of Amadora vs. CA, Article 2180 applies to all schools, academic as well as non-academic. It provides further that teachers in general shall be liable for the acts of their students except where the school is technical in nature, in which case it is the head thereof who shall be answerable. Thus, Soriano, as principal, cannot be held liable for the reason that the school he heads is an academic school and not a school of arts and trades. Besides, as clearly admitted by private respondent Aquino, private respondent Soriano did not give any instruction regarding the digging.

2. Yes. It is very clear that private respondent Aquino acted with fault and gross negligence when he: (1) failed to avail himself of services of adult manual laborers and instead utilized his pupils aged ten to eleven to make an excavation near the one-ton concrete stone which he knew to be a very hazardous task; (2) required the children to remain inside the pit even after they had finished digging, knowing that the huge block was lying nearby and could be easily pushed or kicked aside by any pupil who by chance may go to the perilous area;

(3) ordered them to level the soil around the excavation when it was so apparent that the huge stone was at the brink of falling; (4) went to a place where he would not be able to check on the children's safety; and (5) left the children close to the excavation, an obviously attractive nuisance. These negligent acts have a direct causal connection to the death of Novelito.

A reasonably prudent person would have foreseen that bringing children to an excavation site, and more so, leaving them there all by themselves, may result in an accident. An ordinarily careful human being would not assume that a simple warning "not to touch the stone" is sufficient to cast away all the serious danger that a huge concrete block adjacent to an

excavation would present to the children. Moreover, a teacher who stands in loco parentis to his pupils would have made sure that the children are protected from all harm in his company.

The defense that the digging done by the pupils was part of their Work Education was not sustained, since the nature of the activity reveals a dangerous one and requires the attendance of adult laborers and not ten-year old grade-four pupils. In fact, there was no showing that it was included in the lesson plan for their Work Education. Further it is admitted that Aquino decided all by himself to help his colleague.

The finding of the lower court that the injuries were caused by Novelito’s own reckless imprudence was not sustained. The Court ruled that deceased was only 10 years old as such his actuations were natural to a boy his age. The degree of care required to be exercised must vary with one’s capacity, discretion, knowledge and experience under the same or similar circumstances.

Negligence (Experts/Professionals)

Cullion Ice, Fish and Electric Company vs. Philippine Motors Corporation

GR No. 32611 (November 3, 1930)

Facts: Culion Ice, Fish & Electric Co. Inc. owned a motor schooner named Gwendoline. H.D. Cranston, the representative of Cuilion in Manila, decided to have the engine on the Gwendoline converted from gasoline consumer to a crude oil burner. He had a conference with C.E. Quest, the manager of Phil. Motors, who agreed to do the job, with the understanding that payment shall be made upon completion of the work.

The work began and conducted under the supervision of Mr. Quest, and chiefly by a mechanic whom Quest took with him to the boat. Cranston also directed the members of the crew of the Gwendoline to assist in the work, placing them under the command of Quest.

Upon inspection of the engine, Quest concluded that a new carburetor was needed, hence one was installed. The next problem was to introduce into the carburetor the baser fuel. A temporary tank to contain the mixture was placed on deck above and at a short distance from the compartment covering the engine. This tank was connected with the carburetor by a piece of tubing, which was apparently not well fitted at the point where it was connected with the tank. The fuel mixture leaked from the tank and dripped down into the engine compartment. To paraphrase, a device was made where the engine can be converted from gasoline to crude oil, switching back and forth.

Later, it was observed that the carburetor was flooding, and that the gasoline, or other fuel, was dripping freely from the lower part to the carburetor to the floor. This fact was called to Quest's attention, but he said that, when the engine had gotten to running well, the flooding would stop

The boat was taken out into the bay for a trial run. The engine stopped a few times during the first run, owing to the use of an improper mixture of fuel. As the boat was coming in from this run, the engine stopped, and connection again had to be made with the gasoline line to get a new start. After this had been done, the mechanic, or engineer, switched to the tube connecting with the new mixture. A moment later a back fire occurred in the cylinder chamber. This caused a flame to shoot back into the carburetor, and instantly the carburetor and adjacent parts were covered with a mass of flames, which the members of the crew were unable to subdue. A case for damages was filed.

Issue: Whether or not the loss of the boat is chargeable to the negligence and lack of skill of Quest.

Held: YES. When a person holds himself out as being competent to do things requiring professional skill, he will be held liable for negligence if he fails to exhibit the care and skill of one ordinarily skilled in the particular work which he attempts to do.

The temporary tank in which the mixture was prepared was apparently at too great an elevation from the carburetor, so that when the fuel line was opened, the hydrostatic pressure in the carburetor was greater than the delicate parts of the carburetor could sustain. This was the cause of the flooding of the carburetor; and the result was that; when the back fire occurred, the external parts of the carburetor, already saturated with gasoline, burst into flames, whence the fire was quickly communicated to the highly inflammable material near- by. The leak along the pipe line and the flooding of the carburetor had created a dangerous situation, which a prudent mechanic, versed in repairs of this nature, would have taken precautions to avoid.

Proof shows that Quest had had ample experience in fixing the engines of automobiles and tractors, but it does not appear that he was experienced in the doing of s imilar work on boats. Possibly the dripping of the mixture form the tank on deck and the flooding of the carburetor did not convey to his mind an adequate impression of the danger of fire. Quest did not use the skill that would have been exhibited by one ordinarily expert in repairing gasoline engines on boats. There was here, on the part of Quest, a blameworthy a ntecedent inadvertence to possible harm, and this constitutes negligence. The burning of the Gwendoline may be said to have resulted from accident, but this accident was in no sense an unavoidable accident. It would not have occurred but for Quest's carelessness or lack of skill.

US v. Pineda

37 Phil 456 (January 22, 1918)

Facts: Santiago Pineda is a registered pharmacist and the owner of a drug store. Feliciano Santos, having some sick horses, presented a copy of a prescription to Pineda. On other occasions, Santos had given the medicine prescribed to his horses with good results. Under the supervision of Pineda, the drugs were prepared and given Santos.

Santos, under the belief that he had purchased potassium chlorate, placed two of the packages in water and gave the doses to two of his sick horses. Another package was mixed with water for another horse, but was not used. The two horses, who took the drugs, died afterwards. Santos took the drug packages to the Bureau of Science for examination. It was found that the packages contained not potassium chlorate but barium chlorate (a poison). When sued Pineda alleges that he did not intentionally sold the poison and that what the law (to which he is indicted) forbids is the sell any drug or poison under any "fraudulent name”.

ISSUES: Whether or not Pineda can be held liable for the death of the horses, assuming he did not deliberately sold poison.

HELD: Yes. In view of the tremendous and imminent danger to the public from the careless sale of poison and medicine, we do not deem it too rigid a rule to hold that the law penalizes any druggist who shall sell one drug for another whether it be through negligence or mistake. The care required must be commensurate with the danger involved, and the skill employed must correspond with the superior knowledge of the business which the law demands.

As a pharmacist, he is made responsible for the quality of all drugs and poison he sells. If were we to adhere to the technical definition of fraud it would be difficult, if not impossible, to convict any druggist of a violation of the law. The prosecution would have to prove to a reasonable degree of certainty that the druggist made a material representation; that it was false; that when he made it he knew that it was false or made it recklessly without any knowledge of its truth and as a positive assertion; that he made it with the intention that it should be acted upon by the purchaser; that the purchaser acted in reliance upon it, and that the purchaser suffered injury. Such a construction with a literal following of well-known p rinciples on the subject of fraud would strip the law of at least much of its force. It would leave the innocent purchaser of drugs, who must blindly trust in the good faith and vigilance of the pharmacist, at the mercy of any unscrupulous vendor.

We should not, therefore, without good reason so devitalize the law. The rule of caveat emptor cannot apply to the purchase and sale of drugs. The vendor and the vendee in this case do not stand at arm’s length as in ordinary transactions. It would be idle mockery for the customer to make an examination of a compound of which he can know nothing. Consequently, it must be that the druggist warrants that he will deliver the drug called for.

BPI v. CA

216 SCRA 51 (November 26, 1992)

Facts: A person purporting to be Eligia G. Fernando, who had a money market placement evidenced by a promissory note with a maturity date of November 11, 1981 and a maturity value of P2,462,243.19, called BPI's Money Market Department. The caller wanted to pre-terminate the placement. However, Reginaldo Eustaquio, Dealer Trainee in BPI's Money Market Department, told her that "trading time" was over for the day (Friday). He suggested that she call again the following week. The promissory note the caller wanted to preterminate was a roll-over of an earlier 50-day money market placement that had matured on September 24, 1981.

Later that afternoon, Eustaquio conveyed the request for pretermination to the officer who before had handled Fernando's account, Penelope Bulan, but Eustaquio was left to attend to the pretermination process.

The caller presenting herself as Ms. Fernando phoned again and made a follow-up with Eustaquio the pretermination of the placement. Although Eustaquio was not familiar with the voice of the real Eligia G. Fernando, Eustaquio "made certain" that the caller was the real Eligia G. Fernando by "verifying" the details the caller gave with the details in "the ledger/folder" of the account. But neither Eustaquio nor Bulan who originally handled Fernando's account, nor anybody else at BPI, bothered to call up Fernando at her Philamlife office to verify the request for pretermination.

Informed that the placement would yield less than the maturity value, the caller insisted on the pretermination just the same and asked that two checks be issued for the proceeds, one for P1,800,000.00 and the second for the balance, and that the checks be delivered to her office at Philamlife. Eustaquio, thus, proceeded to prepare the "purchase order slip" for the requested pretermination as required by office procedure. From his desk, the papers, following the processing route, passed through the position analyst, securities clerk, verifier clerk and documentation clerk, before the two cashier's checks were prepared. The two cashier's checks, together with the papers consisting of the money market placement was to be preterminated and the promissory note to be preterminated, were sent to Gerlanda E. de Castro and Celestino Sampiton, Jr., Manager and Administrative Assistant, respectively, in BPI's Treasury Operations Department, both authorized signatories for BPI, who signed the two checks that very morning. Thereafter, the checks went to the dispatcher for delivery.

In the same morning when the checks were to be delivered, the caller changed the delivery instructions; instead that the checks were to be delivered to her office at Philamlife, she would pick the checks up herself or send her niece, Rosemarie Fernando, to pick them up. Eustaquio then told the caller that if her niece was going to get the checks, her niece would have to being a written authorization from her. It was agreed that Rosemarie would pick the checks up from the bank. Thus, Eustaquio hurriedly went to the dispatcher to inform him of the new delivery instructions for the checks; in fact, he changed the delivery instruction on the purchase order slip, writing thereon "Rosemarie Fernando release only with authority to pick up.”

It was, in fact Rosemarie who got the two checks from the dispatcher, as shown by the delivery receipt. As it turned out, the same person impersonated both Eligia G. Fernando and Rosemarie Fernando. Although the checks represented the termination proceeds of Fernando's placement, not just a roll-over of the placement, the dispatcher failed to require the surrender of the promissory note evidencing the placement. There is also no showing that Fernando's purported signature on the letter requesting the pretermination and the latter authorizing Rosemarie to pick up the two checks was compared or verified with Fernando's signature in BPI's file. Such purported signature has been established to be forged although there 0was a "close similarity" to the real signature of Eligia G. Fernando.

On a different day, a woman who represented herself to be Eligia G. Fernando applied at China Banking Corporation's Head Office for the opening of a current account. She was accompanied and introduced to Emily Sylianco Cuaso, Cash Supervisor, by Antonio Concepcion whom Cuaso knew to have opened, earlier that year, an account. What Cuaso indicated in the application form, however, was that Fernando was introduced by Valentin Co, and with her initials on the form signifying her approval, she referred the application to the New Accounts Section for processing. The application form shows the signature of "Eligia G. Fernando", "her" date of birth, sex, civil status, nationality, occupation ("business woman"), tax account number, and initial deposit of P10,000.00. This final approval of the new current account is indicated on the application form by the initials of the cashier, who did not interview the new client but affixed her initials on the application form after reviewing it.

The woman holding herself out as Eligia G. Fernando deposited the two checks in controversy. Her endorsement on the two checks was found to conform with the depositor's specimen signature. CBC's guaranty of prior endorsements and/or lack of endorsement was then stamped on the two checks, which CBC forthwith sent to clearing and which BPI cleared on the same day. Two days after, withdrawals began.

The maturity date of Eligia G. Fernado's money market placement with BPI came and the real Eligia G. Fernando went to BPI for the roll-over of her placement. She disclaimed having preterminated her placement. She then executed an affidavit stating that while she was the payee of the two checks in controversy, she never received nor endorsed them and that her purported signature on the back of the checks was not hers but forged. With her surrender of the original of the promissory note evidencing the placement which matured that day, BPI issued her a new promissory note to evidence a roll-over of the placement.

BPI returned the two checks in controversy to CBC as supported by Eligia G. Fernando's affidavit, for the reason "Payee's endorsement forged". CBC, in turn, returned the checks for reason "Beyond Clearing Time". These incidents led to the filing of this case with the Arbitration Committee.

The Arbitration Committee ruled in favor of BPI and ordered CBC to pay the former with interest. - However, upon CBC’s motion for reconsideration, the Board of Directors of the PCHC reversed the Arbitration Committee's decision and dismissed the complaint of BPI while ordering it to pay CBC.

BPI then filed a petition for review with the Regional Trial Court which dismissed said petition but modified the award by including a provision for attorney’s fees in favor of CBC, among others. The court of appeals affirmed the trial court’s decision.

ISSUES: Who between BPI and CBC should be held liable? Whose negligence was the proximate cause of the payment of the forged checks made by the impostor?

HELD: In the present petition, Fernando’s name in the checks were forged. The checks are "wholly inoperative" and of no effect. However, the underlying circumstances of the case show that the general rule on forgery is not applicable. The issue as to who between the parties should bear the loss in the payment of the forged checks necessities the determination of the rights and liabilities of the parties involved in the controversy in relation to the forged checks.

The records show that petitioner BPI, as drawee bank and CBC as representing or collecting bank were both negligent resulting in the encashment of the forged checks.

The Arbitration Committee in its’ decision, analyzed the negligence of the employees of BPI involved who are involved in the processing of the pre-termination of Fernando's money market placement and in the issuance and delivery of the subject checks. A) The impostor could have been readily unmasked by a mere telephone call, which nobody in BPI bothered to make to Fernando; b) The officer who used to handle Fernando's account did not do anything about the account's pre-termination; c) Again no verification appears to have been made on Fernando's purported signature on the letter requesting the pretermination and the letter authorizing her niece to pick-up the checks, yet, her signature was in BPI's file; and

d) the surrender of the promissory note evidencing the money market placement that was supposedly pre-terminated. The Arbitration Committee, however, belittled BPI's negligence compared to that of CBC which it declared as graver and the proximate cause of the loss of the subject checks to the impostor.

Banks handle daily transactions involving millions of pesos. By the very nature of their work the degree of responsibility, care and trustworthiness expected of their employees and officials is far greater than those of ordinary clerks and employees. For obvious reasons, the banks are expected to exercise the highest degree of diligence in the selection and

supervision of their employees.

In the present case, there is no question that the banks were negligent in the selection and supervision of their employees. The Arbitration Committee, the PCHC Board of Directors and the lower court, however disagree in the evaluation of the degree of negligence of the banks. While the Arbitration Committee declared the negligence of respondent CBC graver, the PCHC Board of Directors and the lower courts declared that BPI's negligence was graver. To the extent that the degree of negligence is equated to the proximate cause of the loss, we rule that the issue as to whose negligence is graver is relevant. No matter how many justifications both banks present to avoid responsibility, they cannot erase the fact that they were both guilty in not exercising extraordinary diligence in the selection and supervision of their employees.

The next issue hinges on whose negligence was the proximate cause of the payment of the forged checks by an impostor. BPI insists that the doctrine of last clear chance should have been applied considering the circumstances of this case. Under this doctrine, where both parties were negligent and such negligence were not contemporaneous, the person who has the last fair chance to avoid the impending harm and fails to do so is chargeable with the consequences, without reference to the prior negligence of the other party.

Applying these principles, BPI's reliance on the doctrine of last clear chance to clear it from liability is not well-taken. CBC had no prior notice of the fraud perpetrated by BPI's employees on the pretermination of Eligia G. Fernando's money market placement. Moreover, Fernando is not a depositor of CBC. Hence, a comparison of the signature of Eligia G. Fernando with that of the impostor Eligia G. Fernando, which CBC did, could not have resulted in the discovery of the fraud. Hence, respondent CBC had no way to discover the fraud at all. In fact, the records fail to show that respondent CBC had knowledge, actual or implied, of the fraud perpetrated by the impostor and the employees of BPI.

BPI further argues that the acts and omissions of are the cause "that set into motion the actual and continuous sequence of events that produced the injury and without which the result would not have occurred." BPI anchors its argument on its stance that there was "a gap, a hiatus, an interval between the issuance and delivery of said checks by BPI to the impostor and their actual payment of CBC to the impostor. BPI points out that the gap of one (1) day that elapsed from its issuance and delivery of the checks to the impostor is material on the issue of proximate cause. At this stage, according to BPI, there was yet no loss and the impostor could have decided to desist from completing the same plan and could have held to the checks without negotiating them.

BPI's contention that CBC alone should bear the loss must fail. The gap of one (1) day between the issuance and delivery of the checks bearing the impostor's name as payee and the impostor's negotiating the said forged checks by opening an account and depositing the same with respondent CBC is not controlling. It is not unnatural or unexpected that after taking the risk of impersonating Eligia G. Fernando with the connivance of BPI's employees, the impostor would complete her deception by encashing the forged checks. There is therefore, greater reason to rule that the proximate cause of the payment of the forged checks by an impostor was due to the negligence of BPI. This finding, notwithstanding, we are not inclined to rule that BPI must solely bear the loss. Due care on the part of CBC could have prevented any loss.

The Court cannot ignore the fact that the CBC employees closed their eyes to the suspicious circumstances of huge over-the-counter withdrawals made immediately after the account was opened. The opening of the account itself was accompanied by inexplicable acts clearly showing negligence. And while we do not apply the last clear chance doctrine as controlling in this case, still the CBC employees had ample opportunity to avoid the harm which befell both CBC and BPI. They let the opportunity slip by when the ordinary prudence expected of bank employees would have sufficed to seize it.

Both banks were negligent in the selection and supervision of their employees resulting in the encashment of the forged checks by an impostor. Both banks were not able to overcome the presumption of negligence in the selection and supervision of their employees. It was the gross negligence of the employees of both banks which resulted in the fraud and the subsequent loss. While it is true that BPI's negligence may have been the proximate cause of the loss, CBC's negligence contributed equally to the success of the impostor in encashing the proceeds of the forged checks. Under these circumstances, we apply Article 2179 of the Civil Code to the effect that while CBC may recover its losses, such losses are subject to mitigation by the courts.

Intoxication

E.M. Wright V Manila Electric R.R. & Light Co.

28 Phil 122 (October 1, 1914)

FACTS: Manila Electric is a corporation engaged in operating an electric street railway. Wright’s residence in Caloocan fronts on the street along which defendant’s tracks run. To enter his premises from the street, Wright must cross defendant’s tracks.

One night, Wright drove home in a calesa and in crossing the tracks to enter the premises of his home, the horse stumbled, leaped forward, and fell, throwing the Wright from the vehicle, causing injuries. On the location where Wright crossed the tracks, the rails were above-ground, and the ties upon which the rails rested projected from one-third to one-half of their depth out of the ground, making the tops of the rails some 5 or 6 inches or more above the level of the street.

Manila Electric admitted that it was negligent in maintaining its tracks, but it also claimed that Wright was also negligent in that he was so intoxicated, and such intoxication was the primary cause of the accident.

The trial court held that both parties were negligent, but that plaintiff’s negligence was not as great as defendant’s. It awarded Wright damages.

ISSUE: Whether or not the negligence of Wright contributed to the “principal occurrence” or “only to his own injury.”

HELD: NO. I ntoxication in itself is not negligence. It is but a circumstance to be considered with the other evidence tending to prove negligence. No facts, other than the fact that Wright was intoxicated, are stated which warrant the conclusion that the plaintiff was negligent. The conclusion that if he had been sober he would not have been injured is not warranted by the facts as found. It is impossible to say that a sober man would not have fallen from the vehicle under the conditions described.

A horse crossing the railroad tracks with not only the rails but a portion of the ties themselves aboveground, stumbling by reason of the unsure footing and falling, the vehicle crashing against the rails with such force as to break a wheel, might be sufficient to throw a person from the vehicle no matter what his condition; and to conclude that, under such circumstances, a sober man would not have fallen while a drunken man did, is to draw a conclusion which enters the realm of speculation and guesswork. Wright was not negligent. No facts to merit a higher award of damages to plaintiff

US vs. Baggay

20 PHIL 142 (September 1, 1911)

Facts: Several persons were assembled in Baggay's house to hold a song service called "buni." The Non-Christian Baggay without provocation, suddenly attacked a woman named Bil- liingan with a bolo, inflicting a serious wound on her head from which she died immediately. With the same bolo, he likewise inflicted various wounds on the women named Calabayan, Agueng, Quisamay, Calapini, and on his own mother, Dioalan.

For this reason, the provincial fiscal filed a complaint in court charging Baggay with murder. After trial and proof that the defendant was suffering from mental aberration, the judge exempted Baggay from criminal liability but was obliged to indemnify the heirs of the murdered woman. The Baggay's counsel and his heirs appealed to this court.

ISSUES: (1) Whether or not an insane person, exempt from criminal liability can still be civilly liable. (2) Can the heirs of Baggay be held civilly liable?

HELD: (1) YES. Civil liability accompanies criminal liability, because every person liable criminally for a crime or misdemeanor is also liable for reparation of damage and for indemnification of the harm done.

Civil liability may arise from acts ordinarily punishable under the penal law, although the law has declared their perpetrators exempt from criminal liability. Such is the case of a lunatic or insane person who, in spite of his irresponsibility on account of the deplorable condition of his deranged mind, is still reasonably and justly liable with his property for the consequences of his acts, even though they be performed unwittingly. His fellows ought not to suffer for the disastrous results of his harmful acts inspite of his unfortunate condition.

Law and society are under obligation to protect him during his illness and so when he is declared to be liable with his property for reparation and indemnification, he is still entitled to the benefit of what is necessary for his decent maintenance, but this protection does not exclude liability for damage caused to those who may have the misfortune to suffer the consequences of his acts.

(2) Yes. The persons who are civilly liable for acts committed by a lunatic or imbecile are those who have them under their authority, legal guardianship or power, unless they prove that there was no blame or negligence on their part.

Should there be no person having them under his authority, legal guardian, or power, if such person be insolvent, the lunatic shall answer with his own property, excepting that part which is exempted for their support in accordance with the civil law.

Degrees of Negligence

Marinduque vs.Workmen’s Compensation

99 PHIL 48 (June 30, 1956)

FACTS: A truck driven by Procopio Macunat, belonging to Marinduque Iron Mines, turned over and hit a coconut tree resulting in the death of Pedro Mamador and injury to the other laborers. Macunat was prosecuted, convicted and was sentenced to indemnify the heirs of the deceased. He paid nothing, however, to the latter. Madador’s wife now seeks compensation by Marinduque Iron Mines as the employer.

ISSUES: (1) Whether or not Mamador has a right to be compensated by Marinduque Iron Mines. (2) Whether or not there was notorious negligence by Mamador for having violated the employer’s prohibition on riding haulage trucks.

HELD: YES. Marinduque Iron Mines alleged that the criminal case sentencing Macunat to indemnify the heirs of Mamador was a suit for damages against a third person, thereby having the effect of releasing the employer from liability. The criminal case, however, was not a suit for damages against third persons because the heirs did not intervene therein and they have not received the indemnity ordered by the court. At any rate, even if the case was against a third person, the court already decided in Nava vs. Inchausti that criminal prosecution of the "other person" does not affect the liability of the employer.

Marunduque also contended that the amicable settlement entered into by Mamador's widow and Macunat barred the widow's claim against the employer because she has already elected one of the remedies. This contention cannot be sustained because what the widow waived was the offender's criminal prosecution and not all civil action for damages.

2. NO. Mere riding on a haulage truck or stealing a ride thereon is not negligence, ordinarily. It couldn't be, because transportation by truck is not dangerous per se. Although the employer prohibited its employees to ride the haulage trucks, its violation does not constitute negligence per se, but it may be an evidence of negligence.

Under the circumstance, however, it cannot be declared negligence because the prohibition had nothing to do with the personal safety of the riders. Notorious negligence means the same as gross negligence which implies "conscious indifference to consequences,” or "pursuing a course of conduct which would naturally and probably result in injury."

Res Ipsa Loquitur

Layugan vs. IAC

167 SCRA 363 November 14, 1968

FACTS: Pedro Layugan testified that while he and his companion were repairing the tire of their cargo truck that was parked along the right side of the National Highway, Godofredo Isidro’s truck, recklessly driven by Daniel Serrano bumped Layugan. As a result, Layugan had his left leg amputated.

Defendant Isidro admitted his ownership of the vehicle involved in the accident. Isidro said that Layugan was merely a bystander, not a truck helper being a brother-in-law of the driver of said truck; that the truck allegedly, while being repaired was parked, occupying almost half of the right lane right after the curve; that the proximate cause of the incident was the failure of the driver of the parked truck in installing the early warning device.

Daniel Serrano, defendant driver, said that he knew the responsibilities of a driver; that before leaving, he checked the truck. The truck owner used to instruct him to be careful in driving. He bumped the truck being repaired by Layugan, while the same was at a stop. Serrano also testified that, “When I was a few meters away, I saw the truck which was loaded with round logs. I stepped on my foot brakes but it did not function with my many attempts. I have (sic) found out later that the fluid pipe on the rear right was cut that's why the breaks did not function.” Layugan, on the other hand, claims that a warning device consisting of the lighted kerosene lamp was placed 3-4 Meters from the back of the truck.

Isidro points to the driver of parked truck as negligent, and says that absent such proof of care, it would, under the doctrine of res ipsa loquitur, there exists a presumption of negligence on the part of the driver of the parked cargo truck as well as his helper.

ISSUES

1. Whether or not defendant driver Serrano was negligent.

2. Whether or not the doctrine of res ipsa loquitur applies in this case.

HELD: 1. NO. The test by which to determine the existence of negligence in a particular case may be stated as follows: Did the defendant in doing the alleged negligent act use that

reasonable care and caution which an ordinarily prudent person would have used in the same situation? If not, then he is guilty of negligence.

Negligence is the omission to do something which a reasonable man, guided by those considerations which ordinarily regulate the conduct of human affairs, would do, or the doing of something which a prudent and reasonable man would not do. Applying the definition and the test, it is clear that the absence or want of care of Daniel Serrano has been

established by clear and convincing evidence. Whether the cargo truck was parked along the road or on half of the shoulder of the road is immaterial taking into account the warning device consisting of the lighted kerosene lamp placed 3-4m from the back of the truck. But despite this warning, the Isuzu truck driven by Serrano, still bumped the rear of the parked cargo truck. As a direct consequence of such accident, Layugan sustained injuries on his left forearm and left foot.

2. NO. In our jurisdiction, Res ipsa loquitur as a rule of evidence is peculiar to the law of negligence which recognizes that prima facie negligence may be established without direct proof and furnishes a substitute for specific proof of negligence. The doctrine is not a rule of substantive law but merely a mode of proof or a mere procedural convenience. The doctrine merely determines and regulates what shall be prima facie evidence thereof and facilitates the burden of plaintiff of proving a breach of the duty of due care.

The doctrine can be invoked when and only when, under the circumstances involved, direct evidence is absent and not readily available. So, it is inapplicable where plaintiff has knowledge and testifies or presents evidence as to the specific act of negligence which is the cause of the injury, or where there’s direct evidence as to the precise cause of the accident and all the facts and circumstances attendant on the occurrence clearly appear. And once the actual cause of injury is established beyond controversy, no presumptions will be involved and the doctrine becomes inapplicable when the circumstances show that no inference of defendant's liability can reasonably be made, whatever the source of the evidence. In this case, it is inapplicable because it was established by clear and convincing evidence the negligence of the defendant driver.

(Note: The discussion in this case of res ipsa loquitur is merely stated in the obiter dictum.)

Ramos vs. CA

321 SCRA 584 (December 29, 1999)

Facts: Erlinda Ramos was a robust woman except for occasional complaints of discomfort due to pains caused by the presence of a stone in her gall bladder. She was advised to undergo an operation for the removal of the stone in her gall bladder. She underwent a series of examinations which included blood and urine tests which indicated she was fit for surgery.

She and her husband, Rogelio, met Dr. Hozaka, one of the defendants in this case, for the first time. They agreed on the date of the operation and the doctor decided that she undergo a “cholecystectomy” operation. Erlinda was admitted in the hospital and was accompanied by her sister-in-law, Herminda Cruz. At the operating room, Cruz saw about two or three nurses and Dr. Perfecta Gutierrez, the other defendant, who was to administer the anesthesia. Although not a member of the hospital staff, Herminda Cruz introduced herself as the Dean of the College of Nursing at the Capitol Medical Center and was allowed to stay inside the operating room.

Hours later, Cruz, who was inside the operating room with the patient, heard somebody say “Dr. Hosaka is already here.” As she held the hand of Erlinda, she then saw Dr. Gutierrez intubating the hapless patient. She thereafter heard Dr. Gutierrez say, “ang hirap maintubate nito, mali yata ang pagkakapasok. O lumalaki ang tiyan”. Due to the remarks of Dr. Gutierrez, she focused her attention on what Dr. Gutierrez was doing. She noticed a bluish discoloration of the nailbeds of the left hand of Erlinda. Cruz then heard Dr. Hosaka issue an order for someone to call Dr. Calderon, another anesthesiologist. After Dr. Calderon arrived in the operating room, Cruz saw him trying to intubate Erlinda. Erlinda’s nailbed became bluish and the patient was placed in a trendelenburg position. Immediately, thereafter, Cruz went out of the operating room, and told Erlinda’s husband (her brother) “that something wrong was happening”. Cruz immediately rushed back, and saw Erlinda was still in trendelenburg position. On that fateful day, she saw Erlinda taken to the Intensive Care Unit (ICU). Erlinda stayed for about four months in the hospital and has been in a comatose condition.

When asked by the hospital to explain what happened to the patient, Doctors Gutierrez and Hosaka explained that the patient had bronchospasm. After being discharged from the hospital, she has been staying in their residence, still needing constant medical attention, with her husband Rogelio incurring monthly expenses. She was diagnosed to be suffering from “diffuse cerebral parenchymal damage.”

The Ramoses filed a civil case for damages against the private respondents alleging negligence in the management and care of Erlinda Ramos.

ISSUES: (1) Whether or not the doctrine of res ipsa loquitur is applicable. (2) Whether or not private respondents were negligent in the care of Erlinda during the anesthesia phase of the operation and, if in the affirmative, whether the alleged negligence was the proximate cause of Erlinda’s comatose condition. (3) Is the hospital liable?

Held: YES. The doctrine of res ipsa loquitur is appropriate in the case at bar. As will hereinafter be explained, the damage sustained by Erlinda in her brain prior to a scheduled gall bladder operation presents a case for the application of the doctrine.

In holding that res ipsa loquitur is available to the present case we are not saying that the doctrine is applicable in any and all cases where injury occurs to a patient while under anesthesia, or to any and all anesthesia cases. Each case must be viewed in its own light and scrutinized in order to be within the res ipsa loquitur coverage.

Res ipsa loquitur is a Latin phrase which literally means “the thing or the transaction speaks for itself.” The phrase “res ipsa loquitur” is a maxim for the rule that the fact of the occurrence of an injury, taken with the surrounding circumstances, may permit an inference or raise a presumption of negligence, or make out a plaintiff’s prima facie case, and present a question of fact for defendant to meet with an explanation.

However, res ipsa loquitur is not a rule of substantive law and, as such, does not create or constitute an independent or separate ground of liability. Instead, it is considered as merely evidentiary or in the nature of a procedural rule. Mere invocation and application of the doctrine does not dispense with the requirement of proof of negligence. It is simply a step in the process of such proof. Still, before resort to the doctrine may be allowed, the following requisites must be satisfactorily shown: 1.The accident is of a kind which ordinarily does not occur in the absence of someone’s negligence; 2. It is caused by an instrumentality within the exclusive control of the defendant or defendants; and 3. The possibility of contributing conduct which would make the plaintiff responsible is eliminated.

In the above requisites, the fundamental element is the “control of the instrumentality” which caused the damage. Such element of control must be shown to be within the dominion of the defendant.

But it does not automatically apply to all cases of medical negligence as to mechanically shift the burden of proof to the defendant to show that he is not guilty of the ascribed negligence. The real question, therefore, is whether or not in the process of the operation any extraordinary incident or unusual event outside of the routine performance occurred. If there were such extraneous interventions, the doctrine of res ipsa loquitur may be utilized and the defendant is called upon to explain the matter, by evidence of exculpation, if he could.

(2) YES. Private respondents were unable to disprove the presumption of negligence on their part. Their negligence was the proximate cause of her condition. Dr. Gutierrez failed to properly intubate the patient. She admitted that she saw Erlinda for the first time on the day of the operation. And no prior consultations with, or pre-operative evaluation of Erlinda was done by her. She was unaware of the physiological make-up and needs of Erlinda. This is an act of exceptional negligence and professional irresponsibility.

Private respondents repeatedly hammered the view that the cerebral anoxia which led to Erlinda’s coma was due to bronchospasm mediated by her allergic response to a drug introduced into her system. Proximate cause has been defined as that which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces injury, and without which the result would not have occurred.

Respondent Dr. Hosaka’s negligence can be found in his failure to exercise the proper authority (as the “captain” of the operative team) in not determining, if his anesthesiologist observed proper anesthesia protocols. No evidence on record exists to show that Dr. Hosaka verified if respondent Dr. Gutierrez properly intubated the patient. Furthermore, it does not escape us that respondent Dr. Hosaka had scheduled another procedure in a different hospital at the same time as Erlinda’s cholecystectomy, and was in fact over three hours late for the latter’s operation. Because of this, he had little or no time to confer with his anesthesiologist regarding the anesthesia delivery.

(3) We now discuss the responsibility of the hospital. The unique practice (among private hospitals) of filling up specialist staff with attending and visiting “consultants,” who are allegedly not hospital employees, presents problems in apportioning responsibility for negligence in medical malpractice cases. The truth is, Private hospitals, hire, fire and exercise real control over their attending and visiting “consultant” staff. While “consultants” are not, technically employees, a point which respondent hospital asserts in denying all responsibility for the patient’s condition, the control exercised, the hiring, and the right to terminate consultants all fulfill the important hallmarks of an employer-employee relationship, with the exception of the payment of wages.

The basis for holding an employer solidarily responsible for the negligence of its employee is found in Article 2180 of the Civil Code which considers a person accountable not

only for his own acts but also for those of others based on the former’s responsibility under a relationship of patria potestas. Such responsibility ceases when the persons or entity concerned prove that they have observed the diligence of a good father of the family to prevent damage. In other words, while the burden of proving negligence rests on the plaintiffs, once negligence is shown, the burden shifts to the respondents (parent, guardian, teacher or employer) who should prove that they observed the diligence of a good father of a family to prevent damage. In the instant case, respondent hospital, apart from a general denial of its responsibility over respondent physicians, failed to adduce evidence showing that it exercised the diligence of a good father of a family in the hiring and supervision of the latter. Upon these disquisitions we hold that private respondents are solidarily liable for damages under Article 2176 of the Civil Code.

Batiquin vs. CA

258 SCRA 334 (July 5, 1996)

Facts: Mrs. Villegas consulted Dr. Batiquin for prenatal care. Dr. Batiquin, along with other physicians and nurses, performed a caesarian operation on Mrs. Villegas and successfully delivered the latter’s baby. After leaving the hospital, Mrs. Villegas began to suffer abdominal pains and complained of being feverish. She also gradually lost appetite, so she consulted Dr. Batiquin at the latter's polyclinic who prescribed certain medicines for her. However, the pains still kept recurring. She then consulted Dr. Ma. Salud Kho. After examining her, Dr. Kho suggested that Mrs. Villegas submit to another surgery.

When Dr. Kho opened the abdomen of Mrs. Villegas she found whitish-yellow discharge inside, an ovarian cyst on each of the left and right ovaries which gave out pus, dirt and pus behind the uterus, and a p iece of rubber which appeared to be a part of a rubber glove. This was the cause of the infection of the ovaries the discomfort suffered by Mrs. Villegas.

The piece of rubber allegedly found was not presented in court. There were also doubts as to the whereabouts of the piece of rubber, as 2 versions arose from Dr. Kho’s testimony: 1) that he sent it to a Pathologist in Cebu and (2) he threw it away. But aside from Dr. Kho's testimony, the Medical Certificate, the Progress Record, the Anesthesia Record, the Nurse's Record, an the Physician's Discharge Summary mentioned the piece of rubber. The trial court, however, regarded these documentary evidence as mere hearsay, since those who prepared them did not testify in court.

The trial court ruled in favor of the defendants. The CA reversed the decision.

Issues: Whether or not Dr. Batiquin could be held liable under the doctrine of res ipsa loquitur.

Held: While Dr. Batiquin claims that contradictions and falsities punctured Dr. Kho's testimony, a reading of said testimony reveals no such infirmity and establishes Dr. Kho as a credible witness. Dr. Batiquin failed to impute any motive for Dr. Kho to state any untruth, leaving her trustworthiness unimpaired.

Considering that we have assessed Dr. Kho to be a credible witness, the rule of res ipsa loquitur comes to fore. In the instant case, all the requisites for recourse to the doctrine are present. First, the entire proceedings of the cesarean section were under the exclusive control of Dr. Batiquin. In this light, the Dr. Batiquin were bereft of direct evidence as to the actual culprit or the exact cause of the foreign object finding its way into private respondent Villegas' body, which, needless to say, does not occur unless through the intervention of negligence. Second, since aside from the cesarean section, V illegas underwent no other operation which could have caused the offending piece of rubber to appear in her uterus, it stands to reason that such could only have been a byproduct of the cesarean section performed by Dr. Batiquin. Dr. Batiquin failed to overcome the presumption of negligence arising from resort to the doctrine of res ipsa loquitur. Dr. Batiquin is therefore liable for negligently leaving behind a piece of rubber in private respondent Villegas' abdomen and for all the adverse effects thereof.

D.M. Consunji vs. CA

357 SCRA 249 (April 20, 2001)

Facts: Jose Juego, a construction worker of D. M. Consunji, Inc., fell 14 floors from the Renaissance Tower, Pasig City to his death. Investigation disclosed that while victim Jose A. Juego together with Jessie Jaluag and Delso Destajo were performing their work on board a steel platform with plywood flooring and cable wires attached to its four corners and hooked at the 5 ton chain block, when suddenly, the bolt or pin which was merely inserted to connect the chain block with the platform came loose causing the whole platform assembly and the victim to fall down to the basement of the elevator core of the building under construction, save his 2 companions who luckily jumped out for safety.

Jose Juego’s widow, Maria, filed with the RTC a complaint for damages against D.M. Consunji, Inc. The employer raised, among other defenses, the widow’s prior availment of the benefits from the State Insurance Fund. The RTC rendered a decision in favor of the widow. On appeal by D. M. Consunji, the CA affirmed the decision of the RTC in toto.

Issue: Whether or not the doctrine of res ipsa loquitur is applicable to prove D.M. Consunji’s negligence.

Held: YES. As a rule of evidence, the doctrine of res ipsa loquitur is peculiar to the law of negligence which recognizes that prima facie negligence may be established without direct proof and furnishes a substitute for specific proof of negligence. It is based in part upon the theory that the defendant in charge of the instrumentality which causes the injury either knows the cause of the accident or has the best opportunity of ascertaining it and that the plaintiff has no such knowledge, and therefore is compelled to allege negligence in general terms and to rely upon the proof of the happening of the accident in order to establish negligence. Res ipsa loquitur is a rule of necessity and it applies where evidence is absent or not readily available, provided the following requisites are present: (1) the accident was of a kind which does not ordinarily occur unless someone is negligent; (2) the instrumentality or agency which caused the injury was under the exclusive control of the person charged with negligence; and (3) the injury suffered must not have been due to any voluntary action or contribution on the part of the person injured.

No worker is going to fall from the 14th floor of a building to the basement while performing work in a construction site unless someone is negligent; thus, the first requisite is present. As explained earlier, the construction site with all its paraphernalia and human resources that likely caused the injury is under the exclusive control and management of appellant; thus, the second requisite is also present. No contributory negligence was attributed to the appellee’s deceased husband; thus, the last requisite is also present. A reasonable presumption or inference of appellant’s negligence arises. Regrettably, petitioner does not cite any evidence to rebut the inference or presumption of negligence arising from the application of res ipsa loquitur, or to establish any defense relating to the incident.

Defenses (Plaintiff’s negligence)

Manila Electric Co. vs Remonquillo

99 PHIL 117 (May 18, 1956)

Facts: Efren Magno went to the house of Antonio Peñaloza, his stepbrother, to repair a leaking “media agua.” The “media agua” was just below the window of the third floor of his stepbrother’s house. Standing on said “media agua”, Magno received from his son thru the window a galvanized iron sheet to cover the leaking portion. The lower end of the iron sheet came into contact with the electric wire of Manila Electric Company parallel to the media agua, causing his death by electrocution.

Magno’s widow and children filed suit to recover damages from the company. Trial court rendered judgment in their favor. Court of Appeals affirmed the decision.

The electric wire in question was an exposed, uninsulated primary wire stretched between poles on the street and carrying a charge of 3600 volts. It was installed there some two years ago before Peñaloza’s house was constructed. During the construction of said house a similar incident took place, with less tragic consequences. The owner of the house complained to the defendant about the danger which the wire presented, and defendant moved one end of the wire farther from the house by means of a brace, but left the other end where it was. Regulations of the City required that “all wires be kept three feet from the building.”There was no insulation that could have rendered it safe, because there is no insulation material in commercial use for such kind of wire (according to appellant, and this was not refuted).

ISSUE: Whether or not Manila Electric is guilty of negligence.

HELD: NO. It was the victim who was guilty of negligence. The liability of electric companies for damages or personal injury is governed by the rules of negligence. Nevertheless such companies are not insurers of the safety of the public.

The death of Magno was primarily caused by his own negligence, and in some measure by the too close proximity of the “media agua” to the electric wire of the company by reason of the violation of the original permit given by the city and the subsequent approval of said illegal construction of the “media agua.”

The company cannot be expected to be always on the lookout for any illegal construction which reduces the distance between its wires and said construction, and to change the installation of its wires so as to preserve said distance.

The violation of the permit for the construction was not the direct cause of the accident. It merely contributed to it. The real cause of the accident or death was the reckless or negligent act of Magno himself. It is to be presumed that due to his age and experience he was qualified to do so. He had training and experience for the job. He could not have been entirely a stranger to electric wires and the danger lurking in them.

Bernardo vs. Legaspi

29 Phil 12 (December 23, 1914)

Facts: Due to a collision between the respective automobiles of Bernardo and Legaspi, the former filed an action to recover damages for injuries sustained by his car. Legaspi, on the other hand, filed a cross-complaint alleging it was Bernardo's fault. He also asks for damages. The lower court found upon that both the plaintiff and the defendant were negligent in handling their automobiles and that said negligence was of such a character and extent on the part of both as to prevent either from recovering.

ISSUE Whether or not the parties may recover damages

HELD: NO. Where two automobiles, going in opposite directions, collide on turning a street corner, and it appears from the evidence and is found by the trial court that the drivers thereof were equally negligent and contributed equally to the principal occurrence as determining causes thereof, neither can recover of the other for damages suffered.

Bernal vs. House

54 PHIL 327 (January 30, 1930)

Facts: Fortunata Enverso with her daughter, Purificacion Bernal went to Tacloban, Leyte to attend the procession on Holy Friday. After the procession, accompanied by two other persons, they passed along a public street. Purificacion was allowed to get a short distance in advance of her mother and her friends.

While in front of the offices of the Tacloban Electric & Ice Plant, Ltd., an automobile appeared which frightened the child. She turned to run, but fell into the street gutter. At that time there was hot water running in the gutter coming from the Electric Ice Plant of J.V. House. When the mother and her companions reached the child, they found her face downward in the hot water. The girl was taken to the provincial hospital. Despite his efforts, the child died that same night. It was certified that the cause of death was "Burns, 3rd Degree, whole Body", and that the contributory causes were "Congestion of the Brain and visceras of the chest & abdomen.”

The defense was that the hot water was permitted to flow down the side of the street with the knowledge and consent of the authorities and that the cause of death was other than the hot water; and that in the death the plaintiffs contributed by their own fault and negligence. The trial judge dismissed the action because of the contributory negligence of the plaintiffs.

Issue: Whether or not the action should be dismissed due to the contributory negligence of the plaintiffs

Held: NO. The death of the child was the result of fault and negligence in permitting hot water to flow through the public streets, endangering the lives of passers-by who were unfortunately enough to fall into it. The mother and her child had a perfect right to be on the street on the evening when the religious procession was held. There was nothing abnormal in allowing the child to run along a few paces in advance of the mother. No one could foresee the coincidence of an automobile appearing and of a frightened child running and falling into a ditch filled with hot water. . The contributory negligence of the child and her mother, if any, does result not operate as a bar to recovery, but in its strictest sense could only in reduction of the damages.

PLDT vs. CA

G.R. No. 57079 (September 29, 1989)

FACTS: The jeep of Spouses Esteban ran over a mound of earth and fell into an open trench, an excavation allegedly undertaken by PLDT for the installation of its underground conduit system. The Spouses Esteban’s complaint alleged that Antonio Esteban failed to notice the open trench which was left uncovered because of the creeping darkness and the lack of any warning light or signs. Gloria Esteban allegedly sustained injuries on her arms, legs and face, leaving a permanent scar on her cheek, while the respondent husband suffered cut lips. The windshield of the jeep was also shattered.

PLDT, in its answer, denies liability on the contention that the injuries sustained by Spouses Esteban were the result of their own negligence and that the entity which should be held responsible, if at all, is L.R. Barte and Company, an independent contractor which undertook the said construction work. The trial court ruled in favor of Esteban spouses whereas the CA reversed the ruling.

Issue: Whether or not the Estebans can claim damages from PLDT.

Held: NO. A person claiming damages for the negligence of another has the burden of proving the existence of such fault or negligence causative thereof. The facts constitutive of negligence must be affirmatively established by competent evidence.

The accident was due to the lack of diligence of Antonio Esteban and was not imputable to the negligent omission on the part of petitioner PLDT. The jeep was running along the inside lane of Lacson Street. If it had remained on that inside lane, it would not have hit the accident mound. That plaintiffs’ jeep was on the inside lane before it swerved to hit the accident mound could have been corroborated by a picture showing Lacson Street to the south of the accident mound. Plaintiffs’ jeep was not running at 25 kilometers an hour as plaintiff husband claimed. At that speed, he could have stepped on the brakes the moment it struck the accident mound.

The above findings clearly show that the negligence of Antonio Esteban was not only contributory to his injuries and those of his wife but goes to the very cause of the occurrence of the accident, as one of its determining factors, and thereby precludes their right to recover damages.

Defenses (Contributory Negligence)

Genobiagon vs. Court of Appeals

178 SCRA 422 (September 22, 1957)

Facts: Genobiagon was driving a rig along T. Padilla St. in Cebu City. The petitioner's vehicle was going so fast not only because of the steep down-grade of the road, but also because he was trying to overtake the rig ahead of him.

As an old woman was crossing the street, Genobiagon’s rig bumped her and caused her to fall in the middle of the road. Vicente Mangyao saw the incident and shouted at Genobiagon but the latter refused to stop. Genobiagon reasoned out that he did not bump the old woman and that it was the old woman who bumped him. The old woman was brought to the hospital but she died 3 days after. Petitioner was charged and convicted with the crime of homicide thru reckless imprudence. CA affirmed the decision but increased the civil liability from 6,000 to 12,000. Hence, this petition.

Issues: (1) Whether or not the court erred in the affirmation of conviction (2) Whether or not the court unjustly increased the civil liability

Held: (1) No. The alleged contributory negligence of the victim, if any, does not exonerate the accused. The defense of contributory negligence does not apply in criminal cases committed through reckless imprudence, since one cannot allege the negligence of another to evade the effects of his own negligence.

(2) No. The prevailing jurisprudence in fact provides that indemnity for death in homicide or murder is 30,000 (at present 50,000, this case was decided in 1989).

Rakes vs. Atlantic

G.R. No. 1719 (1907)

Facts: The plaintiff Rakes, one of a gang of eight negro laborers in the employment of the defendant, was at work transporting iron rails from a barge in the harbor to the company's yard near the malecon in Manila. Plaintiff claims that but one hand car was used in this work. The defendant Atlantic, has proved that there were two immediately following one another, upon which were piled lengthwise seven rails, each weighing 560 pounds, so that the ends of the rails lay upon two crosspieces or sills secured to the cars, but without side pieces or guards to prevent them from slipping off. According to the testimony of the plaintiff, the men were either in the rear of the car or at its sides. According to that defendant, some of them were also in front, hauling by a rope. At a certain spot at or near the water's edge the track sagged, the tie broke, the car either canted or upset, the rails slid off and caught the plaintiff, breaking his leg, which was afterwards amputated at about the knee.

In order to charge the defendant with negligence, it was necessary to show a breach of duty on its part in failing either to properly secure the load on iron to vehicles transporting it, or to skillfully build the tramway or to maintain it in proper condition, or to vigilantly inspect and repair the roadway as soon as the depression in it became visible. It is upon the failure of the defendant to repair the weakened track, after notice of its condition, that the judge below based his judgment.

In respect of the second charge of negligence against the plaintiff, the judgment below is not so specific. While the judge remarks that the evidence does not justify the finding that the car was pulled by means of a rope attached to the front end or to the rails upon it, and further that the circumstances in evidence make it clear that the persons necessary to operate the car could not walk upon the plank between the rails and that, therefore, it was necessary for the employees moving it to get hold upon it as best they could, there is no specific finding upon the instruction given by the defendant to its employees to walk only upon the planks, nor upon the necessity of the plaintiff putting himself upon the ties at the side in order to get hold upon the car.

Issue: Whether or not there was contributory negligence on the part of Rakes.

Held: While the plaintiff and his witnesses swear that not only were they not forbidden to proceed in this way, but were expressly directed by the foreman to do so, both the officers of the company and three of the workmen testify that there was a general prohibition frequently made known to all the gang against walking by the side of the car, and the foreman swears that he repeated the prohibition before the starting of this particular load. On this contradiction of proof we think that the preponderance is in favor of the defendant's contention to the extent of the general order being made known to the workmen. If so, the disobedience of the plaintiff in placing himself in danger contributed in some degree to the injury as a proximate, although not as its primary cause.

Difficulty seems to be apprehended in deciding which acts of the injured party shall be considered immediate causes of the accident. The test is simple. Distinction must be between the accident and the injury, between the event itself, without which there could have been no accident, and those acts of the victim not entering into it, independent of it, but contributing under review was the displacement of the crosspiece or the failure to replace it. this produced the event giving occasion for damages — that is, the shinking of the track and the sliding of the iron rails. To this event, the act of the plaintiff in walking by the side of the car did not contribute, although it was an element of the damage which came to himself. Had the crosspiece been out of place wholly or partly thorough his act of omission of duty, the last would have been one of the determining causes of the event or accident, for which he would have been responsible. Where he contributes to the principal occurrence, as one of its determining factors, he cannot recover. Where, in conjunction with the occurrence, he contributes only to his own injury, he may recover the amount that the defendant responsible for the event should pay for such injury, less a sum deemed a suitable equivalent for his own imprudence.

Philippine Bank of Commerce v CA (Lipana)

269 SCRA 695 (March 14, 1997)

Facts: Rommel's Marketing Corporation (RMC) maintained two separate current accounts with the Pasig Branch of PBCom in connection with its business of selling appliances. From May 5, 1975 to July 16, 1976, Romeo Lipana, RMC’s GM, claims to have entrusted RMC funds in the form of cash totaling P304,979.74 to his secretary, Irene Yabut, for the purpose of depositing said funds to RMC’s account with PBCom. It turned out, that these deposits were not credited to RMC's account but were instead deposited to the PBCom account of Yabut's husband, Bienvenido Cotas.

Irene Yabut would accomplish two copies of the deposit slip, an original and a duplicate. The original showed the name of her husband as depositor and his current account number. On the duplicate copy was written the account number of her husband but the name of the account holder was left blank. PBC's teller, Azucena Mabayad, would validate and stamp both the original and the duplicate of these deposit slips retaining only the original copy despite the lack of information on the duplicate slip. The second copy was kept by Irene Yabut allegedly for record purposes. After validation, Yabut would then fill up the name of RMC in the space left blank in the duplicate copy and change the account number written thereon and make it appear to be RMC's account number. She made her company believe that the amounts she deposited were being credited to its account when, in fact, they were being deposited in the account of her husband.

During the entire period, PBCom had been regularly furnishing RMC with monthly statements showing its current account balances. Unfortunately, it was never the practice of Romeo Lipana to check these monthly statements reposing complete trust and confidence to PBCom and to his secretary. Upon discovery of the loss of its funds, RMC demanded from petitioner bank the return of its money.

Issue: Whether or not there was contributory negligence on the part of RMC.

Held: In the case at bench, there is no dispute as to the damage suffered by the private respondent (plaintiff in the trial court) RMC in the amount of P304,979.74. It is in ascribing fault or negligence which caused the damage where the parties point to each other as the culprit.

Picart v. Smith, provides the test by which to determine the existence of negligence in a particular case which may be stated as follows: Did the defendant in doing the alleged negligent act use that reasonable care and caution which an ordinarily prudent person would have used in the same situation? If not, then he is guilty of negligence.

Applying the above test, it appears that the bank's teller, Ms. Azucena Mabayad, was negligent in validating, officially stamping and signing all the deposit slips prepared and presented by Ms. Yabut, despite the glaring fact that the duplicate copy was not completely accomplished contrary to the self-imposed procedure of the bank with respect to the proper validation of deposit slips, original or duplicate, as testified to by Ms. Mabayad herself. Negligence here lies not only on the part of Ms. Mabayad but also on the part of the bank itself in its lackadaisical selection and supervision of Ms. Mabayad. This was exemplified in the testimony of Mr. Romeo Bonifacio, then Manager of the Pasig Branch of the petitioner bank and now its Vice-President, to the effect that, while he ordered the investigation of the incident, he never came to know that blank deposit slips were validated in total disregard of the bank's validation procedures.

It was this negligence of Ms. Azucena Mabayad, coupled by the negligence of the petitioner bank in the selection and supervision of its bank teller, which was the proximate cause of the loss suffered by the private respondent, and not the latter's act of entrusting cash to a dishonest employee, as insisted by the petitioners

Defenses (Fortuitous Event)

Juntilla vs. Fontanar

136 SCRA 624 (May 31, 1985)

Facts: Juntilla was a passenger of a public utility jeepney, being driven by Defendant Berfol Camoro, enroute from Danao to Cebu City. The jeepney had fourteen (14) passengers in the back and three (3) at the front, one of whom was Juntilla. Upon reaching Mandaue City, the right rear tire of the jeepney exploded causing the vehicle to fall into a ditch and turn turtle. As consequence, Juntilla was thrown out of the jeepney and sustained lacerations to his right palm and suffered other injuries. Juntilla, still shocked, went back to Danao City for medical help but on his way discovered that his watch is missing.

Juntilla then filed a case for breach of contract of carriage with damages before the City Court of Cebu, which found the respondents (the driver, the franchise operator and owner) liable for the accident ordering the latter to pay damages, including the value of watch lost by petitioner during the incident. Upon appeal, the CFI, relying on a case decided by the Court of Appeals (Rodriguez case), exonerated respondents on grounds that the blowing of tire is a fortuitous event, and therefore beyond the control of the latter.

Issues: (1) Whether or not the blowing of the tire a fortuitous event (2) Whether or not the respondents should be held liable for breach of contract of carriage.

Held: No. A fortuitous event has the following essential characteristics:

(a) The cause of the unforeseen or unexpected occurrence, or the failure of the obligor to comply with his obligation must be independent of human will.

(b) The event must be impossible to foresee or if it can be foreseen, it must be impossible to avoid.

(d) The obligor must be free from any participation in the aggravation if the injury resulting to the oblige

The Supreme Court held that the cause of the incident was NOT independent from human will. The accident was caused EITHER by the negligence of the driver or because of the

mechanical defects in the tire.

Common carriers should teach their drivers not to overload their vehicles, not to exceed the speed limits and to know the correct measures to take when a tire blows up, thus ensuring the safety of the passengers at all times. In the instant case, the Supreme Court found that the jeep was overloaded with passengers (17, excluding the driver), and was speeding. The Court made the observation that a jeepney at a regular and safe speed would not have jump into a ditch when the right rear tire blows up.

Neither can the driver and operator point liability to the manufacturer of the tire. The Supreme Court, citing Necesito et. al. vs. Paras, held that:

xxx [A] passenger is entitled to recover damages from a carrier for an injury resulting from a defect in appliance (tire) purchased from a manufacturer, whenever it appears

that the defect would have been discovered by the carrier if it had exercised the degree of care…with regard to the inspection and application of the necessary tests…[T]he manufacturer is considered… the agent or servant of the carrier as regards the work of the appliance (tire) xxx

Such rationale is based on the fact that the passenger has neither choice nor control over the carrier’s selection of the tire. Having no privity with the manufacturer or vendor of the tire, the passenger has no remedy against the former, on the other hand, the carrier has. T he sudden blowing up of the tire may have been caused by too much air pressure. The Source of the common carrier’s legal liability is the contract of carriage. The carrier binds itself to carry the passengers safely as human care and foresight can provide, using the utmost diligence of a very cautious person, with due regard for all circumstances.

Hernandez vs. Commission on Audit

179 SCRA 39 (November 6, 1989)

Facts: At the time of the incident in question, Teodoro M. Hernandez was the officer-in-charge and special disbursing officer of the Ternate Beach Project of the Philippine Tourism Authority in Cavite. As such, he went to the main office of the Authority in Manila on July 1, 1983 to encash two checks covering the wages of the employees and the operating expenses of the Project. He estimated that the money would be available by 10:00AM and that he would be back in Ternate by about 2:00PM. For some reason, the processing of the checks was delayed and was completed only at 3:00PM. Despite realizing that he would not reach ternate in time to distribute the salary of the workers, Hernandez nevertheless decided to encash them. He thought he had to do this for the benefit of the laborers, otherwise they would have to wait until the following Tuesday, when the main office would reopen. And so, on the same afternoon he collected the cash value of the checks and left the main office a substantial amount of money.

Hernandez realized that had two choices, to (1) return to Ternate, Cavite, the same afternoon and arrive there in the early evening; or (2) take the money to his house in Marilao, Bulacan, spend the night there, and leave for Ternate the following morning. He opted for the second, thinking it the safer one. And so, he took a passenger jeep bound for his house in Bulacan.

While the vehicle was along EDSA, two persons boarded with knives in hand. One pointed his weapon at the Hernandez’ side while the other slit his pocket and forcibly took the money he was carrying. The two then jumped out of the jeep and ran. Hernandez, after the initial shock, immediately followed in desperate pursuit. He caught up with Virgilio Alvarez and overcame him after a scuffle. Hernandez sustained injuries in the lip arms and knees. Alvarez was subsequently charged with robbery and pleaded guilty, but the robber who had the money escaped.

On July 5, 1983, Hernandez filed a request for relief from money accountability under Section 638 of the Revised Administrative Code. Deespite favorable endorsement by

Philippine Tourism Authority and the NCR Regional Director of the Commission on Audit, the Commission on Audit, through then Chairman Francisco S. Tantuico, jr. denied the Hernandez’ request. According to Tantuico, the loss of the P10,175.00 under the accountability of Mr. Hernandez can be attributed to his negligence because had he brought the cash proceeds of the checks (replenishment fund) to the Beach Park in Ternate, Cavite, immediately after encashment for safekeeping in his office, which is the normal procedure in the handling of public funds.

Issue: Whether or not the COA acted with grave abuse of discretion in holding Hernandez negligent.

Held: Section 638 of the Revised Administrative Code reads as follows:

Section 638. Credit for loss occurring in transit or due to casualty. Notice to Auditor. When a loss of government funds or property occurs while the same is in transit or is caused by fire, theft, or other casualty, the officer accountable therefor or having custody thereof shall immediately notify the Auditor General, or the provincial auditor, according as a matter is within the original jurisdiction of the one or the other, and within thirty days or such longer period as the Auditor, or provincial auditor, may in the particular case allow, shall present his application for relief, with the available evidence in support thereof. An officer who fails to comply with this requirement shall not be relieved of liability or allowed credit for any such loss in the settlement of his accounts.

Applying the letter and spirit of the above-mentioned laws, and after considering the established facts in the light of the arguments of the parties, this Court inclines in favor of the petitioner.

It is pointless to argue that Hernandez should have encashed the vouchers earlier because they were dated anyway on June 29, 1983. He was not obliged to encash the checks earlier and then again there might have been any number of reasons why he did so only on July 1, 1983. The point is that he did encash the checks on that date and took the money to Marilao and not Ternate in view of the lateness of the hour. The question before us is whether these acts are so tainted with negligence or recklessness as to justify the denial of the petitioner's request for relief from accountability for the stolen money.

It seems to us that the petitioner was moved only by the best of motives when he encashed the checks on July 1, 1983, so his co-employees in Ternate could collect their salaries and wages the following day. Significantly, although this was a non-working day, he was intending to make the trip to his office the following day for the unselfish purpose of accommodating his fellow workers. The other alternative was to encash the check is on July 5, 1983, the next working day after July 1, 1983, which would have meant a 5-day wait for the payment of the said salaries and wages. Being a modest employee himself, Hernandoz must have realized the great discomfort it would cause the laborer who were dependent on their wages for their sustenance and were anxious to collect their pay as soon as possible. F or such an attitude, Hernandez should be commended rather than faulted.

As for Hernandez's choice between Marilao, Bulacan, and Ternate, Cavite, one could easily agree that the former was the safer destination, being nearer, and in view of the comparative hazards in the trips to the two places. It is true that the petitioner miscalculated, but the Court feels he should not be blamed for that. The decision he made seemed logical at that time and was one that could be expected of a reasonable and prudent person. And if, as it happened, the two robbers attacked him in broad daylight in the jeep while it was on a busy highway, and in the presence of other passengers, it cannot be said that all this was the result of his imprudence and negligence. This was undoubtedly a fortuitous event covered by the said provisions, something that could not have been reasonably foreseen although it could have happened, and did.

We find, in sum, that under the circumstances as above narrated, the petitioner is entitled to be relieved from accountability for the money forcibly taken from him in the afternoon of July 1, 1983. To impose such liability upon him would be to read the law too sternly when it should be softened by the proven facts.

Gotesco vs. Chatto and Lina Delza Chatto

210 SCRA 18 (June 16, 1992)

Facts: Gloria E. Chatto and her 15-year old daughter, Lina, went to see the movie "Mother Dear" at Superama I theater, owned by defendant Gotesco Investment Corporation. They bought balcony tickets but even then were unable to find seats. Hardly ten (10) minutes after entering the theater, the ceiling of its balcony collapsed. The theater was plunged into darkness and pandemonium ensued. Shocked and hurt, the mother and daughter managed to crawl under the fallen ceiling. As soon as they were able to get out to the street they walked the nearby FEU Hospital where they were confined and treated for one (1) day.

Chatto filed a complaint for damages against Gotesco. Defendant tried to avoid liability by alleging that the collapse of the ceiling of its theater was due to force majeure. The trial court ordered Gotesco to pay the plaintiffs moral damages, actual damages, attorney's fees, plus the cost of the suit. The CA affirmed the decision.

Issue: Whether or not the collapse of the ceiling was due to an act of God or Force Majeure?

Held: No. The collapse of the ceiling was not due to Force Majeur. Mr. Jesus Lim Ong, admitted that "he could not give any reason why the ceiling collapsed." Having interposed it as a defense, it had the burden to prove that the collapse was indeed caused by force majeure. It could not have collapsed without a cause. The fact that Mr. Ong could not offer any explanation does not imply force majeure.

Petitioner could have easily discovered the cause of the collapse if indeed it were due to force majeure. To Our mind, the real reason why Mr. Ong could not explain the cause or reason is that either he did not actually conduct the investigation or that he is, as the respondent Court impliedly held, incompetent. He is not an engineer, but an architect who had not even passed the government's examination. Verily, post-incident investigation cannot be considered as material to the present proceedings. What is significant is the finding of the trial court, affirmed by the respondent Court that the collapse was due to construction defects. There was no evidence offered to overturn this finding. The building was constructed barely four (4) years prior to the accident in question. It was not shown that any of the causes denominates as force majeure obtained immediately before or at the time of the collapse of the ceiling. S uch defects could have been easily discovered if only petitioner exercised due diligence and care in keeping and maintaining the premises. But as disclosed by the testimony of Mr. Ong, there was no adequate inspection of the premises before the date of the accident. The fact that structural designs and plans of the building were duly approved by the City Engineer and that building permits and certificate of occupancy were issued, do not at all prove that there were no defects in the construction, especially as regards the ceiling, considering that no testimony was offered to prove that it was ever inspected at all.

Besides, even assuming for the sake of argument that, as petitioner vigorously insists, the cause of the collapse was due to force majeure, petitioner would still be liable because it was guilty of negligence, which the trial court denominated as gross. As gleaned from Bouvier's definition of and Cockburn's elucidation on force majeure for one to be exempt from any liability because of it, he must have exercised care, i.e., he should not have been guilty of negligence.

Servando vs. Philippine Steam Navigation Co

117 SCRA 832

Facts: Clara Uy Bico and Amparo Servando loaded on board a vessel owned by Philippine Steam Navigation cargoes consisting of 1,528 cavans of rice and 44 cartons of colored paper for carriage from Manila to Pulupandan, Negros Occidental. Bills of lading were issued by Philippine Navigation. The cargoes were discharged in Negros Occidental Bureau of Customs Warehouse as complete and in good order.

At about 2:00 PM of the same day, the Customs warehouse was razed by a fire of unknown origin, destroying the cargoes. The claims for the value of said goods were rejected by Philippine Steam, herein respondent. Lower Court ordered Philippine Steam to pay Servando damages, including legal interest from filing of the case. They also awarded damages to Uy Bico the sum for the portion of the cargo which was not recovered by her. The legal basis of the lower court for its decision if Article 1736:

Common carriers have the duty to observe extraordinary diligence from the moment the goods are unconditionally placed in their possession until the same are delivered, actually or constructively, by the carrier to the consignee or to the person who has a right to receive them, without prejudice to the provisions of Article 1738

It held that the delivery to the Bureau of Customs is not the constructive delivery as contemplated in Article 1736, thus the common carrier continues to be responsible.

Issue: Whether or not FIRE is a fortuitous event, absolving Respondents of any liability?

Held: Yes. The burning of the warehouse was an extraordinary event independent of the will of the respondents. The following characteristics of caso fortuito are present. 1. the cause of the unforeseen event must be independent of the human will; 2. it must be impossible to foresee the event which constitutes the 'caso fortuito', or if it can be foreseen, it must be

impossible to avoid; 3. the occurrence must be such as to render it impossible for the debtor to fulfill his obligation in a normal manner.4. the obligor must be free from any participation in the aggravation of the injury resulting to the creditor. When the proximate cause of loss is a fortuitous event or force majeure, the obligor is exempt from liability. This is provided for by Article 1174 of the Civil Code.

Article 1174. Except in cases expressly specified by the law, or when it is otherwise declared by stipulation, or when the nature of the obligation requires the assumption of risk, no person shall be responsible for those events which could not be foreseen, or which, though foreseen, were inevitable.

It should also be pointed out that in the Bill of Lading (BOL) existing on the cargoes, the responsibility of the carrier has been limited as provided by Clause 14.:

Not unless the loss or damage is caused by the negligence of the carrier, the common carrier shall not be liable for such caused by force majeures, accidents of sea, war and public enemies.

This is a mere reiteration of Article 1174.

Furthermore, the storage of the goods in the Customs warehouse while waiting withdrawal by the petitioners was made with their knowledge and consent. Since the warehouse belonged t o and maintained by the government, it would be unfair to impute negligence to Philippine Steam, having no control over the same. There is also no proof or showing that the fire can be imputable to the negligence of its employees. Judgment appealed is set aside.

NAPOCOR vs. CA

GR Nos. 1 03442-45 (1993)

Facts: The controversy stemmed from separate complaints filed by several residents of Norzagaray, Bulacan against petitioner, National Power Corp. The residents seek to recover actual and other damages for the loss of lives due to the inundation of their town. The flooding was allegedly caused by NAPOCOR’s acts of negligently releasing water in the spillways of Angat Dam (hydroelectric plant). NAPOCOR, in its defense, maintains that (1) they exercised due care and diligence in maintaining the power plant; (2) petitioners duly notified the residents about the impending release of water with the onset of typhoon kading and advised them to take necessary precautions; and (3) that the damages incurred by private respondents were caused by a fortuitous event or force majeure.

The lower court dismissed the complaints for lack of sufficient evidence. The CA reversed the decision and awarded actual and moral damages (plus litigation expenses) to the residents. The judgment was based on a patent gross and evident lack of foresight, imprudence and negligence in the management and operation of Angat Dam. The unholiness of the hour, the extent of the opening of the spillways, and the magnitude of the water released, are all but products of NAPOCOR’s headlessness, slovenliness, and carelessness. The resulting flash flood and inundation of even areas (sic) one (1) kilometer away from the Angat River bank would have been avoided had NAPOCOR prepared the Angat Dam by maintaining a water elevation, which would allow room for the expected torrential rains.

The CA also rejected the NAPOCOR’s plea that the incident was caused by a fortuitous event.

Issue: Whether or not the incident was caused by a fortuitous event.

Held: The SC rendered its decision based on the same errors in G.R. No. 96410, entitled National Power Corporation, et al., vs. Court of Appeals, et al, according to the Court, the proximate cause of the damage incurred by private respondents was due to negligence of the NAPOCOR. The early warning notice was insufficient. The SC cannot rule otherwise because its decision is now binding.

To exempt the obligor from liability under Article 1174 (Acts of God) of the Civil Code, the following must concur: (a) the cause of the breach of the obligation must be independent of the will of the debtor; (b) the event must be either unforseeable or unavoidable; (c) the event must be such as to render it impossible for the debtor to fulfill his obligation in a moral manner; and (d) the debtor must be free from any participation in, or aggravation of the injury to the creditor

Thus, if upon the happening of a fortuitous event or an act of God, there concurs a corresponding fraud, negligence, delay or violation or contravention in any manner of the tenor of the obligation as provided for in Article 1170 of the Civil Code, which results in loss or damage, the obligor cannot escape liability

The principle embodied in the act of God doctrine strictly requires that the act must be one occasioned exclusively by the violence of nature and all human agencies are to be excluded from creating or entering into the cause of the mischief. Thus it has been held that when the negligence of a person concurs with an act of God in producing a loss, such person is not exempt from liability by showing that the immediate cause of the damage was the act of God. To be exempt from liability for loss because of an act of God, he must be free from any previous negligence or misconduct by which that loss or damage may have been occasioned.

Southeastern College Inc. v CA

GR No. 126389 (July 10, 1998)

Facts: Private Respondents Dimaano are owners of a house in College Road, Pasay City while petitioner Corporation, South Eastern College, owns a four-storey school building along the same road. In October 1989, a powerful typhoon called “Saling” hit the Metro. Buffeted by very strong winds, the roof of petitioner’s building was partly ripped off and blown away, landing and destroying portions of the roofing of Dimaano’s house. An ocular inspection was conducted by a team of engineers. They found that one factor and perhaps, the most likely reason for the dislodging of the roofings structural trusses is the improper anchorage of the trusses to the roof beams, thus recommending the building to be declared a structural hazard.

Respondents filed a complaint based on culpa aquiliana, alleging that the damage to their house rendered the same uninhabitable, forcing them to stay temporarily in other houses. The Dimaanos sought to recover actual, moral and exemplary damages, including attorney’s fees and costs from petitioners. In their answer, Southeastern averred that the building withstood several devastating typhoons and other calamities in the past without its roofing giving way, and that typhoon Saling was an act of God.

In giving credence to the ocular inspection, the Trial court ruled in favor of the Dimaanos and ordered the Southeastern to pay the decreed damages sought. The Court of Appeals affirmed the decision but reduced the award of moral damages.

Issues: Whether or not the Southeastern College is liable for the damage.

Held: No. The antecedent of fortuitous event or caso fortuito is found in the Partidas which defines it as an event which takes place by accident and could not have been foreseen. In order that a fortuitous even may exempt a person from liability, it is necessary that he be free from any previous negligence or misconduct by reason which the loss may have been occasioned

There is no question that a typhoon or storm is a fortuitous even, a natural occurrence which may be foreseen but is unavoidable despite any amount of foresight, diligence or care. From these premises, we proceed to determine whether Southeastern was negligent, such that if it were not the damage caused to private respondents’ house could have been avoided? At the outset it bears emphasizing that a person claiming damages for the negligence of another has the burden of proving the existence of fault or negligence. The facts c onstitutive of negligence must be affirmatively established by competent evidence, not merely by presumption or conclusions without basis of fact. The Dimaanos merely relied on the ocular inspection, however by this basis, the relationship of cause and effect has NOT been clearly shown.

On the other hand, petitioner elicited from private respondent’s city building official, Jesus Reyna, that the original plans and design of petitioner’s school building were

approved including the certificate of occupancy. Having obtained both, these are, at the least, prima facie evidence of the regular and proper construction of a subject school building.

As to the damages, it is not enough that the damage be capable of proof but must be actually proved with reasonable degree of certainty, pointing out specific facts that afford a basis for measuring whatever compensatory damages are borne.

ASSUMPTION OF RISK

Afialda vs. Hisole

85 Phil 67 (November 29, 1949)

Facts: Loreto Afialda was employed by Hisole spouses as caretaker of their carabaos. While tending to the animals, he was gored by one of them and later died as a consequence. His sister then filed a complaint against the spouses Hisole. The spouses filed a motion to dismiss, which the court granted. Plaintiff now seeks to hold defendants liable under art. 1905 of the Civil Code which states that “The possessor of an animal or the one who uses the same, is liable for any damages it may cause, even if such animal should escape from him or stray away. This liability shall cease only in case the damage should arise from force majeure or from the fault of the person who may have suffered it.”

Issue: Whether or not the owner of the animal is liable when the damage is caused to its caretaker.

Held: No. The owner of an animal is answerable only for damages caused to a stranger, and that damage caused to the caretaker of the animal the owner would be liable only if he had been negligent or at fault under art. 1902 of the Civil Code. In the case at bar, the animal was in the custody of the caretaker. It was the caretaker’s business to try to prevent the animal f rom causing injury or damage to anyone, including himself. Being injured by the animal was one of the risks of the occupation which he had voluntarily assumed and for which he must take the consequences. There was no allegation of negligence on the part of the Hisole spouses. Thus, they are not liable.

Ilocos Norte Electric Company (INEL Co.)vs. Court of Appeals

179 SCRA 5 (November 6, 1989)

Facts: In the evening of June 28 until the early morning of June 29, 1967, typhoon 'Gening' buffeted the province of Ilocos Norte and brought heavy rains and flooding. Between 5:30- 6:00AM, Isabel Lao Juan (Nana Belen) along with Aida Bulong and Linda Estavillo ventured out of her house and traversed waist-deep flood to proceed to a store, which she owns to check if her merchandise have been damaged. Suddenly, Nana Belen screaamed 'ay!' and quickly sank into the water. The two girls attempted to help but fear dissuaded them because on the spot where the deceased sank, they saw an electric wire dangling from a post and moving in snake-like fashion in the water. Ernesto dela Cruz tried to go to Nana Belen but he turned back because the water was grounded. Ernesto informed Antonio Yabes that his mother in law had been electrocuted and together they went to the City Hall of Laoag to request the police to ask INELCO to cut off the current. Subsequently, the search for the body began and such was found two meters from an electric post.

In another place at about 4:00 A.M., Engineer Antonio Juan of the NAPOCOR noticed certain fluctuations in their electric meter which indicated such abnormalities as grounded or short-circuited lines. He then went out for inspection and saw grounded and disconnected lines which were hanging from posts to the ground. Since there were no INELCO linemen in sight, he decided to go to the INELCO office but it was closed. On the way to INELCO, he passed by Guerrero St. and saw and electric wire about 30 meters long and the other end of the wire was seeming to play with the current of the water. At about 8:00 A.M., he went out for inspection again and learned about the death of Nana Belen. He tried to help revive the deceased but his efforts proved futile. He also noticed a hollow wound on the left palm of the victim. In the afternoon, he went on an inspection trip again and the wire that he saw on Guerrero St. earlier was no longer there.

Dr. Castro examined the body of the deceased at around 8:00 A.M. and noted that the skin was grayish or cyanotic which indicated death by electrocution. The wound on the left palm was an electrically charged wound or a first degree burn. The certificate of death prepared by Dr. Castro stated the cause of death as 'circulatory shock electrocution'.

An action for damages was instituted by the heirs of the deceased. INELCO, through its officers and employees who testified, claims that on and even before June 29, their electric system did not suffer from any defect that might constitute hazard to life and property. Moreover, it was alleged that the lines and devices were newly installed and they had installed safety devices to prevent injuries to persons and damage to property in case of natural calamities. INELCO also alleged that they had 12 linesmen charged with the duty of checking the areas assigned to them. Fabico Abijero even testified that in the early morning of June 29, he passed by the intersection of Guerrero and Rizal streets and did not see any broken wires. He said that what he saw were many people fishing out the body of the deceased. INELCO also presented Dr. Briones who said that without an autopsy, no doctor or medico-legal can speculate the cause of death. Moreover, he said that cyanosis (lack of oxygen circulating in the blood) appears only in a live person. INELCO also said that the deceased was negligent because she installed a burglar deterrent by connecting a wire from the main house to the iron gate, thus charging the latter with electric current whenever the switch is on. INELCO then conjectures that the switch must have been left on, causing the deceased electrocution when she tried to open her gate.

The CFI ruled in favor of INELCO. CA reversed.

Issues: (1) Whether or not the deceased died of electrocution. (2) Whether or not petitioner INELCO may be held liable for the death of Isabel Lao Juan. (3) Whether or not the maxim

volenti non fit injuria can be applied in the case at bar.

Held:

(1) YES. The nature of the wounds as described by the witnesses who saw them can lead to no other conclusion than that they were burns and there was nothing else in the street where the victim was wading thru which could cause a burn except the dangling live wire of petitioner company. In the issue of the burglar deterrent, the suggestion of petitioner that the switch was left on is mere speculation, not backed up with evidence.

(2) YES. While it is true that typhoons and floods are considered Acts of God for which no person may be held responsible, it was not said eventuality which directly caused the victim's death. It was through the intervention of petitioner's negligence that death took place. As stated by Engr. Juan in his testimony, he saw no INELCO lineman and that the office of INELCO was closed. The SC held that in times of calamities, extraordinary diligence requires a supplier of electricity to be in constant vigil to prevent or avoid any probable incident that might imperil life or limb. The petitioner was negligent in seeing to it that no harm is done to the general public. Furthermore, the court held that when an act of God combines or concurs with the negligence of the defendant (in this case the petitioner) to produce an injury, the defendant is liable if the injury would not have resulted but for his own negligent conduct or omission.

(3) NO. It is imperative to note the surrounding circumstances which impelled the deceased to leave the comforts of a roof and brave the subsiding typhoon. She went to her grocery store to see to it that the goods were not flooded. It has been held that a person is excused from the force of the rule, that when he voluntarily assents to a known danger he must abide by the consequences, if an emergency is found to exist or if the life or property of another is in peril or when he seeks to rescue his endangered property. Clearly, an emergency was at hand as the deceased's property, a source of her livelihood, was faced with an impending loss. Furthermore, she was at a place where she had a right to be without regard to petitioner's consent as she was on her way to protect her merchandise.

DUE DILIGENCE

Ramos, et al vs. Pepsi-Cola Bottling Co. of the P.I., et al

19 SCRA 289 (1967)

Facts: The car owned by Placido Ramos, while being driven by his son Augusto, collided with a truck-tractor and trailer of Pepsi Cola, driven by i Andres Bonifacio. Ramos filed a case at the CFI of Manila against Pepsi. CFI found Bonifacio negligent and declared that Pepsi Cola failed to exercise the due diligence of a good father of a family to prevent the damage. Pepsi and Bonifacio are held solidarily liable to pay P2,638.50 actual damages, P2,000 moral damages, P2000 exemplary damages and P1,000 Atty. fees.

CA affirmed the decision of CFI regarding Bonifacio but absolved Pepsi Cola from liability stating that Pepsi has sufficiently proved due diligence in the selection of its employees.

Issue: Whether or not Pepsi Cola exercised due diligence in the selection of its driver.

Held: Yes. When it was proven that the employer had carefully examined the erring driver as to his qualifications, experience and record of service, such evidence is sufficient to show that the employer exercised the diligence of a good father of a family in the selection of the driver and rebuts the juris tantum presumption that the employer was negligent. Juan Anasco, personnel manager of Pepsi stated that before Bonifacio was hired, his background, experience, physical capacity was checked. Also, he was asked to submit clearance and also asked to take theoretical and practical driving examination. Pepsi was also a member of the Safety Council.

Petitioner can no longer assail the credibility of Anasco. Findings of CA are binding on SC. A motion for reconsideration was made stating that respondents violated the Motor vehicle law. It was said that the truck was overweight and running beyond the speed limit and that it was not equipped with a rear vision mirror and with a helper. Such allegations failed to show their basis. Patrolman Pahate did not affirm such allegations. Also, a special permit may be granted for overweight trucks and the absence of such permit was not proven. In Quasi delicts, the motor vehicle owner is not an absolute owner against all damages caused by its driver. The owner’s responsibility ceases once it proves that it has observed the diligence of a good father of a family to prevent the damages.

Metro Manila Transit Corp. (MMTC) vs. CA

223 SCRA 521 June 21, 1993

Facts: Appellant Nenita Custodio boarded a jeepney driven by defendant Agudo Calebag and owned by his co-defendant Victorino Lamayo. The jeepney collided with an MMTC bus at the intersection of DBP Avenue and Honeydew Road. MMTC bus was driven by defendant Godofredo Leonardo. Both drivers failed to slow down or blow their horns. As a result of said incident, Custodio was thrown out through the windshield and sustained serious physical injuries. She was sent to the hospital and regained consciousness only after a week.

Appellant, assisted by her parents, filed a complaint for damages. Defendants denied the material allegations. MMTC for its part presented Milagros Garbo, its training officer, and Christian Bautista, its transport supervisor, as two of its witnesses. Garbo testified that the company's bus drivers undergo a series of training programs, examinations, clearances, interviews and seminars for their selection. Bautista on the other hand, testified that he ensured the drivers were in proper uniform, briefed in traffic rules and regulations and fit to drive before the start of duty.

The trial court found both drivers negligent for non-observance of appropriate traffic rules and regulations and for failure to take the usual precautions when approaching an intersection. It however, absolved MMTC, stating that it was careful and diligent in selecting its employees and strict and diligent in supervising them as shown by the evidence. The CA modified the said ruling, holding MMTC solidarily liable with the other defendants. According to the CA, MMTC failed to substantiate its allegations that it exercised the diligence of the good father of a family in the selection and supervision of its employees. It pointed out the fact that Garbo and Bautista failed to present documentary evidence to support their claims, such as the clearances and test results of Leonardo or the written guidelines. As such, the testimonies fall short of the required evidentiary quantum.

Issue: Whether or not the evidence of MMTC is sufficient to show that it exercised the diligence of a good father of a family in the selection and supervision of its employees.

Held: No. The SC agrees with the ruling of the CA.

In civil cases, the degree of evidence required of a party in order to support his claim is preponderance of evidence, or that evidence adduced by one party which is more conclusive and credible than that of the other party. It is, therefore, incumbent on the plaintiff who is claiming a right to prove his case. Corollary, defendant must likewise prove its own allegation to buttress its claim that it is not liable. In fine, the party, whether plaintiff or defendant, who asserts the affirmative of the issue has the burden of presenting at the trial such amount of evidence required by law to obtain a favorable judgment. In the case at bar, petitioner's attempt to prove it diligentissimi patris familias in the selection and supervision of employees must fail as it was unable to buttress the same with any other evidence, object or documentary, which might obviate the apparent biased nature of the testimony. MMTC only gave oral testimonies as its evidence, no documentary proof was submitted upon request to further bolster its defense. The mere formulation of various company policies on saftey without showing that they were being complied with is not sufficient to exempt petitioner from liability arising from negligence of its employees.

The SC does not find the evidence presented by petitioner sufficiently convincing to prove the diligence of a good father of a family. Hence, applying Art. 2180 in relation to Art. 2176, petitioner is held solidarily liable with the other defendants.

PRESCRIPTION

Kramer vs. Court of Appeals

178 SCRA 518 (October 13, 1989)

Facts: On April 8, 1976, F/B Marjolea, a fishing boat owned by the petitioners was navigating its way from Marinduque to Manila. Somewhere near Maricabon Island and Cape Santiago, the boat collided with an inter-island vessel, the M/V Asia Philippines, owned by the private respondent Trans-Asia Shipping Lines, Inc.

F/B Marjolea sank, taking with it its fish catch. The captains of both vessels filed their respective marine protests with the Board of Marine Inquiry of the Philippine Coast Guard. The Board conducted an investigation for the purpose of determining the proximate cause of the maritime collision. On October 19, 1981, the Board concluded that the loss of the F/B Marjolea and its fish catch was attributable to the negligence of the employees of the private respondent who were on board the M/V Asia Philippines during the collision. The findings made by the Board served as the basis of a subsequent Decision of the Commandant of the Philippine Coast Guard dated April 29, 1982 wherein the second mate of the M/V Asia Philippines was suspended from pursuing his profession as a marine officer.

On May 30, 1985, the petitioners instituted a Complaint for damages against the private respondent in the RTC. The private respondent filed a Motion seeking the dismissal of the Complaint on the ground of prescription. He argued that under Article 1146 of the Civil Code, the prescriptive period for instituting a Complaint for damages arising from a quasi- delict like a maritime collision is four years. He maintained that the petitioners should have filed their Complaint within four years from the date when their cause of action accrued, i.e., from April 8, 1976 when the maritime collision took place, and that accordingly, the Complaint filed on May 30, 1985 was instituted beyond the four-year prescriptive period. Petitioners contended that maritime collisions have peculiarities and characteristics which only persons with special skill, training and experience like the members of the Board of Marine Inquiry can properly analyze and resolve. The petitioners argued that the running of the prescriptive period was tolled by the filing of the marine protest and that their cause of action accrued only on April 29, 1982, the date of the decision of the board become final.

RTC ruled in favor of petitioners holding that in ascertaining negligence relating to a maritime collision, there is a need to rely on highly technical aspects attendant to such collision, and that the Board was constituted precisely to answer the need. CA reversed the decision, holding that it is clear that the cause of action of the petitioners accrued from the occurrence of the mishap because that is the precise time when damages were inflicted upon and sustained by the aggrieved party. It said that if the tolling of the prescriptive period would hinge upon the discretion of a government agency, said alternative could entail hazards. Hence the appeal.

Issue: Whether or not the action for quasi-delict is barred by prescription.

Held: Yes. Under Article 1146 of the Civil Code, an action based upon a quasi-delict must be instituted within four years. The prescriptive period begins from the day the quasi-delict is committed. The right of action accrues when there exists a cause of action, which consists of 3 elements, namely: a) a right in favor of the plaintiff by whatever means and under whatever law it arises or is created; b) an obligation on the part of defendant to respect such right; and c) an act or omission on the part of such defendant violative of the right of the plaintiff. It is only when the last element occurs or takes place that it can be said in law that a cause of action has arisen.

Allied Banking Corporation vs. Court of Appeals

178 SCRA 526 (October 13, 1989)

Facts: In 1977, Joselito Yujuico obtained a loan from GEN BANK in the amount of PhP500,000 and as evidence, it issued a promissory note payable GEN BANK. At the time private respondent incurred the obligation, he was a ranking officer of GENBANK and a member of the family which owns the controlling interest in the bank. In 1980, the Central Bank issued a resolution forbidding GENBANK from doing further business. Four days after, another resolution was issued ordering the liquidation of GENBANK. Later, ALLIED Bank acquired all the assets and assumed all the liabilities of GENBANK, including the receivable due from private Yujuico.

Upon Yujuico’s failure to pay, ALLIED Bank filed a complaint against private respondent for the collection of a sum of money. The CA affirmed the RTC decision in a special proceeding finding that the liquidation of GENBANK was made in bad faith. This decision declared the liquidation of GENBANK null and void. It was then that Yujuico filed the third party complaint for damages alleging that by reason of the tortious interference by the Central Bank with the affairs of GENBANK, he was prevented from paying his loan.

Issue: Assuming that the Central Bank is guilty of tortious interference, has the claim of Yujuico under the third party complaint prescribed?

Held: YES. An action for damages arising from quasi-delict or alleged tortious interference should be filed within four (4) years from the day the cause of action accrued. Since the cause of action accrued on 25 March 1980 (the time when Central Bank issued a cease and desist order against GENBANK) and the third party complaint was filed only on June 17 1987, the action has prescribed.

It is from the date the act or omission violative of the right of a party that the cause of action arises and it is from this date that the prescriptive period must be reckoned. (Español vs. Chairman, Philippine Veterans)The third party complaint should not be admitted.

Causation (Proximate Cause)

Bataclan vs. Medina

G.R. No. L-10126 (1957)

Facts: Bus no. 30 of the Medina Transportation, operated by its owner, Mariano Medina, left the town of Amadeo, Cavite, on its way to Pasay City, driven by Conrado Saylon. Among the passengers were Juan Bataclan. While the bus was running within the jurisdiction of Imus, Cavite, one of the front tires burst causing the vehicle to zig-zag until it fell into a canal or ditch on the right side of the road and turned turtle. Some of the passengers managed to leave the bus, others had to be helped or pulled out, while the three passengers seated beside the driver, namely Bataclan, Lara and the Visayan and the woman behind them named Natalia Villanueva, could not get out of the overturned bus. After half an hour, came about ten men, one of them carrying a lighted torch made of bamboo with a wick on one end. These men presumably approached the overturned bus, and almost immediately, a fire started, consuming the bus, including the four passengers trapped inside. It would appear that as the bus overturned, gasoline began to leak and escape from the gasoline tank on the side of the chassis, spreading over and permeating the body of the bus and the ground under and around it, and that the lighted torch brought by one of the men who answered the call for help set it on fire.

The heirs of the deceased brought an action to recover from Mariano Medina compensatory, moral, and exemplary damages and attorney's fees.

Issue: Whether or not the proximate cause of the death of Bataclan was not the overturning of the bus, but rather, the fire that burned the bus, including himself and his co-passengers who were unable to leave it.

Held: The Court held that the proximate cause was the overturning of the bus, this for the reason that when the vehicle turned not only on its side but completely on its back, the leaking of the gasoline from the tank was not unnatural or unexpected; that the coming of the men with a lighted torch was in response to the call for help, made not only by the passengers, but most probably, by the driver and the conductor themselves, and that because it was dark (about 2:30 in the morning), the rescuers had to carry a light with them, and coming as they did from a rural area where lanterns and flashlights were not available; and what was more natural than that said rescuers should innocently approach the vehicle to extend the aid and effect the rescue requested from them.

In other words, the coming of the men with a torch was to be expected and was a natural sequence of the overturning of the bus, the trapping of some of its passengers and the call for outside help. What is more, the burning of the bus can also in part be attributed to the negligence of the carrier, through is driver and its conductor.

According to the witness, the driver and the conductor were on the road walking back and forth. They, or at least, the driver should and must have known that in the position in which the overturned bus was, gasoline could and must have leaked from the gasoline tank and soaked the area in and around the bus, this aside from the fact that gasoline when spilled, specially over a large area, can be smelt and directed even from a distance, and yet neither the driver nor the conductor would appear to have cautioned or taken steps to warn the rescuers not to bring the lighted torch too near the bus.

Fernando vs. Court of Appeals and the City of Davao

G.R. No. 92087 (May 8, 1992)

Facts: Morta, market master of Agdao Public Market requested with the City Treasurer Office the emptying of a Septic tank in Agdao. An invitation to bid was issued to Bertulano, Catarsa, Bascon, Bolo and Suner. Bascon won the bid and signed the purchase order. Prior to the signing of purchase order, Bertulano with four other companions- Liagoso, Fernando and Fajardo Jr. was found dead inside the septic tank.

While, Garcia died in the Regional Hospital after being rescued by a fireman. Autopsy revealed diminution of oxygen and intake of sulfide gas as cause of death. Investigation by the City Engineer Office learned that the 5 victims entered and re-emptied the tank without clearance and consent. The heirs of the deceased filed a case for damages contending that it was the gross negligence of the City of Davao for failing to clean the septic tank for 10 years which resulted in the accumulation of hydrogen sulfide gas, and was therefore the proximate cause of the death of the laborers. They further contend that the market master failed to supervise the area where the tank was located as a further reflection of the public respondent’s negligence. Petitioner’s also insisted on the application of Article 24 of the New Civil code. Art. 24. In all c ontractual, property or other relations, when one of the parties is at a disadvantage on account of his moral dependence, ignorance, indigence, mental weakness, tender age or other handicap, the courts must be vigilant for his protection.

Issue: WON proximate cause of death is the own negligence of the plaintiffs?

Held: Yes. Proximate cause is that cause, which, in the natural and continuous sequence unbroken by and efficient intervening cause, produces the injury and without which the result would not have occurred.

While it may be true that the public respondent had been negligent in the re emptying of the septic tank annually since 1956, the negligence is not a continuing one. The public respondents have immediately responded to such issue upon invitation to bid on the service of emptying the tank. Public Respondents have also shown in court that people in the market have been using the toilet for their necessities and remained uninjured.

As proven by Respondents, the septic tank was air-tight as provided for by regulations. The accident of toxic gas leakage from the tank is unlikely to happen unless one removes

its covers. The accident occurred because the victims have ontheir own and without authority opened the tank. Bertulano who has offered his services to clean the septic tank is

presumed to know the hazards of his job. His and his men’s failure to take precautionary measures for their safety is the proximate case of the accident. The Court also cited Culion vs. Phil Motors Corp. “When a person holds himself out as being competent to do things requiring professional skill, he will be held liable for negligence if he fails to exhibit the skill of one ordinarily skilled in the particular work he attempts to do.” Furthermore, the surreptitious way the victims did the job without clearance from the market master and or the security jobs g oes against their good faith.

Moreover, Article 24 of the NCC is inapplicable as there is total absence of contractual relations between the victims and City of Davao that will give rise to contractual obligations as the victims did not win the bidding. It was not to Bertulano, but to Bascon, that the contract to clean the septic tank was awarded.

Urbano vs. IAC

G.R. No. L-72964) (1988)

Facts: Petitioner, Filomeno Urbano quarreled with Marcelino Javier because the latter opened the irrigation canal which caused the flooding of the place where Urbano's palay was stored. Urbano hacked the right palm of Javier with a bolo and caused an incised wound that was later treated. Urbano and Javier agreed on an amicable settlement and petitioner paid for the hospital bills.

22 days later, Javier was rushed to the hospital, he had a locked jaw and was having convulsions, caused by tetanus toxin. The doctor noticed that the wound was infected. The next day, Javier died. Petitioner was charged with homicide and was later found guilty by the trial court. The IAC affirmed the conviction. Petitioner filed a motion for new trial based on the affidavit of the barangay captain that Javier was found catching fish on the irrigation canal, 10 days prior to his death.

Issue: Whether or not the inflicting of the wound by petitioner was only a remote, and not a proximate, cause.

Held: The inflicting of the wound is only a remote cause and petitioner cannot be held liable therefor. A prior and remote cause cannot be made the basis of an action if such remote cause did nothing more than furnish the condition or give rise to the occasion by which the injury was made possible, if there intervened between such prior or remote cause and the injury a distinct, successive, unrelated and efficient cause of injury, even though such injury would not have happened but for such condition or occasion. If no danger existed in the condition except because of the independent cause, such condition was not the proximate cause. And if an independent negligent act or defective condition sets into operation the circumstances, which result in injury because of the prior defective condition, such subsequent act or condition is the proximate cause.

The incubation period of tetanus, ranges from 2 to 56 days. However, over 80 percent of patients become symptomatic within 14 days. A short incubation period indicates severe disease, and when symptoms occur within 2 or 3 days of injury, the mortality rate approaches 100 percent. (NOTICE that it took Javier 22 days, from the time of the hacking, before he had symptoms of Tetanus)

In the case at bar, the evidence on record does not clearly show that the wound inflicted by Urbano was infected with tetanus at the time of the hacking. The evidence merely confirms that the wound, which was already healing at the time Javier suffered the symptoms of the fatal ailment, somehow got infected with tetanus. However, as to when the wound was infected is not clear. There is a likelihood that the wound was but the remote cause and its subsequent infection (failure to take the necessary precautions against tetanus) may have been the proximate cause of Javier's death.

Phoenix Construction vs. IAC

148 SCA 353 (L-652095) (1987)

Facts: In the early morning of 15 November 1975 — at about 1:30 a.m. — private respondent Leonardo Dionisio was driving his way home from a cocktails-and-dinner meeting with his boss. During the cocktails phase of the evening, Dionisio had taken "a shot or two" of liquor. Dionisio was driving his Volkswagen car and had just crossed the intersection of General Lacuna and General Santos Streets at Bangkal, Makati, not far from his home, and was proceeding down General Lacuna Street, when his car headlights (in his allegation) suddenly failed. He switched his headlights on "bright" and thereupon he saw a Ford dump truck looming some 2-1/2 meters away from his car.

The dump truck, owned by and registered in the name of petitioner Phoenix Construction Inc. ("Phoenix"), was parked on the right hand side of General Lacuna Street facing the oncoming traffic. The dump truck was parked askew in such a manner as to stick out onto the street, partly blocking the way of incoming traffic. There were neither lights nor any so- called "early warning" reflector devices set anywhere near the dump truck, front or rear. The dump truck had earlier that evening been driven home by petitioner Armando Carbonel, its regular driver, with the permission of his employer Phoenix, in view of work scheduled to be carried out early the following morning, Dionisio claimed that he tried to avoid a collision by swerving his car to the left but it was too late and his car smashed into the dump truck. As a result of the collision, Dionisio suffered some physical injuries including some permanent facial scars, a "nervous breakdown" and loss of two gold bridge dentures.

Dionisio commenced an action for damages in the Court of First Instance of Pampanga basically claiming that the legal and proximate cause of his injuries was the negligent manner in which Carbonel had parked the dump truck entrusted to him by his employer Phoenix. Phoenix and Carbonel, on the other hand, countered that the proximate cause of Dionisio's injuries was his own recklessness in driving fast at the time of the accident, while under the influence of liquor, without his headlights on and without a curfew pass. Phoenix also sought to establish that it had exercised due care in the selection and supervision of the dump truck driver.

Issue: Whether or not the proximate cause of the accident is the negligence of the driver or the negligence of Dionisio.

Held: It was the negligence of the truck driver. The legal and proximate cause of the accident and of Dionisio's injuries was the wrongful — or negligent manner in which the dump truck was parked in other words, the negligence of petitioner Carbonel. , the collision of Dionisio's car with the dump truck was a natural and foreseeable consequence of the truck driver's negligence.

The truck driver's negligence far from being a "passive and static condition" was rather an indispensable and efficient cause. The collision between the dump truck and the private respondent's car would in an probability not have occurred had the dump truck not been parked askew without any warning lights or reflector devices. The improper parking of the dump truck created an unreasonable risk of injury for anyone driving down General Lacuna Street and for having so created this risk, the truck driver must be held responsible. In our view, Dionisio's negligence, although later in point of time than the truck driver's negligence and therefore closer to the accident, was not an efficient intervening or independent cause.

respondent Dionisio's negligence was "only contributory," that the "immediate and proximate cause" of the injury remained the truck driver's "lack of due care" and that consequently respondent Dionisio may recover damages though such damages are subject to mitigation by the courts

TRIVIA: Did the headlights of Dionisio really turned off unexpectedly, as he claims? Remember, this happened during Martial law years when curfews were in effect. It was 1:30 AM and Dinisio was drunk. Excellent!

Pilipinas Bank v. CA

G.R. No. 105410 (1994)

Facts: As payments for the purchased shoe materials and rubber shoes, Florencio Reyes issued postdated checks to Winner Industrial Corporation and Vicente Tui with due dates on October 10 and 12, 1979, respectively.

To cover the face value of the checks, plaintiff, on October 10, 1979, requested PCIB Money Shop's manager Mike Potenciano to effect the withdrawal of P32,000.00 from his savings account therein and have it deposited with his current account with Pilipinas Bank (then Filman Bank), Biñan Branch. Roberto Santos was requested to make the deposit. In

depositing in the name of FLORENCIO REYES, he inquired from the teller the current account number of Florencio Reyes to complete the deposit slip he was accomplishing.

He was informed that it was "815" and so this was the same current account number he placed on the deposit slip below the depositor's name FLORENCIO REYES. Nothing that the account number coincided with the name Florencio, Efren Alagasi, then Current Account Bookkeeper of Pilipinas Bank, thought it was for Florencio Amador who owned the listed account number. He, thus, posted the deposit in the latter's account not noticing that the depositor's surname in the deposit slip was REYES. On October 11, 1979, the October 10, check in favor of Winner Industrial Corporation was presented for payment. Since the ledger of Florencio Reyes indicated that his account had only a balance of P4,078.43, it was dishonored and the payee was advised to try it for next clearing. On October 15, 1979, the October 10, 1979 check was redeposited but was again dishonored. Likewise, the October 12, 1979 check in favor of Vicente Tui when presented for payment on that same date met the same fate but was advised to try the next clearing. Two days after the October 10 check was again dishonored, the payee returned the same to Florencio Reyes and demanded a cash payment of its face value which he did if only to save his name. The October 12, 1979 check was redeposited on October 18, 1979, but again dishonored for the reason that the check was drawn against insufficient fund. Furious over the incident, he immediately proceeded to the bank and urged an immediate verification of his account. Upon verification, the bank noticed the error. The P32,000.00 deposit posted in the account of Florencio Amador was immediately transferred to the account of Reyes upon being cleared by Florencio Amador that he did not effect a deposit in the amount of P32,000.00. The transfer having been effected, the bank then honored the October 12, 1979, check.

Issue: WON the proximate cause of the mis-posting of deposit was due to the error of the representative of Reyes

Held: No. For Article 2179 of the Civil Code to apply, it must be established that private respondent's own negligence was the immediate and proximate cause of his injury. The concept of proximate cause is well defined in our corpus of jurisprudence as "any cause which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces the result complained of and without which would not have occurred and from which it ought to have been forseen or reasonably anticipated by a person of ordinary case that the injury

complained of or some similar injury, would result therefrom as a natural and probable consequence." In the case at bench, the proximate cause of the injury is the negligence of

petitioner's employee in erroneously posting the cash deposit of private respondent in the name of another depositor who had a similar first name. As held by the trial court:

Applying the test, the bank employee is, on that basis, deemed to have failed to exercise the degree of care required in the performance of his duties. As earlier stated, the bank employee posted the cash deposit in the account of Florencio Amador from his assumption that the name Florencio appearing on the ledger without, however, going through the full name, is the same Florencio stated in the deposit slip. He should have continuously gone beyond mere assumption, which was proven to be erroneous, and proceeded with clear certainty, considering the amount involved and the repercussions it would create on the totality of the person notable of which is the credit standing of the person involved should a mistake happen. The checks issued by the plaintiff in the course of his business were dishonored by the bank because the ledger of Florencio Reyes indicated a balance insufficient to cover the face value of checks.

Quezon City Government vs. Fulgencio Dacara

G.R. NO. 150304 (June 15, 2005)

Facts: Fulgencio Dacara, Jr., son of herein respondent was driving the Toyota Corolla of his father along Matahimik St. in Quezon City. While driving, the vehicle rammed into a pile of earth (street diggings) as the street was being repaired by the Quezon City government. As result, Dacara allegedly sustained bodily injuries and the vehicle suffered extensive damages when it turned turtled as it hit the pile of earth.

Indemnification was sought from the City Government but it yielded negative results. Dacara Sr. on behalf of his minor son filed a complaint for damages against herein petitioner (QCG). In its answer, QCG alleged that the diggings were provided with a mound of soil and barricaded with reflectorized traffic paint with sticks placed before or after it which was visible during the incident. QCG claimed that they exercised due care by providing the area of the diggings all necessary measures to avoid accident. Such claim was disproved by the investigation report which stated that the deep excavation was without any warning device. The RTC, on the basis of Art. 2189 of the Civil Code, rendered judgment in favor of Fulgencio Dacara and ordered QCG to pay the former actual, moral and exemplary damages, attorney's fees and costs of suit. CA affirmed. Hence, this petition.

Issues:

1. Whether or not negligence of Fulgencio Dacara, Jr. was the proximate cause of the accident.

2. Whether or not award for moral damages is proper.

3. Whether or not award for exemplary damages is proper.

HELD: (1) NO. Art. 2189 NCC capsulizes the responsibility of the city government relative to the maintenance of roads and bridges since it exercises the control and supervision over the same. Failure of the petitioner to comply with the statutory provision found in the subject-article is tantamount to negligence per se which renders the City government liable. Petitioner pointed out that Fulgencio was driving at the speed of 60kph which was above the maximum limit of 30kph when he met the accident, so he can be presumed negligent based on Art. 2185. Such a matter was not raised at any time during the trial and was only raised for the first time in their Motion for Reconsideration. The SC held it was too late to raise such issue .

(2) NO. Art. 2219(2) NCC specifically allows moral damages to be recovered for quasi-delicts, provided that the act or omission caused physical injuries. There can be no recovery or moral damages unless the quasi-delict resulted in physical injury. In the case at bar, Fulgencio testified that he suffered a deep cut on his left arm. However, no other evidence such as a medical certificate, was presented to prove such bare assertion of physical injury. Thus, there was no credible proof that would justify an award of moral damages. Moral damages are not punitive in nature, but are designed to compensate and alleviate in some way the physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation, and similar injury inflicted on a person. Moral damages cannot be awarded in the absence of proof that the person experienced emotional and mental suffering. Mere allegations do not suffice, clear and convincing proof is necessary.

(3) YES. Exemplary damages cannot be recovered as a matter of right, it is subject to the discretion of the courts but cannot be awarded unless claimants show their entitlement to moral, temperate or actual damages. In the case at bar, petitioner's negligence was the proximate cause of the incident, thereby establishing his right to actual damages. Art. 2231 NCC mandates that in cases of quasi-delicts, exemplary damages may be recovered if the defendant acted with gross negligence. Such a circumstance obtains in the instant case. The City Government failed to show the modicum of responsibility, much less, care expected from them by the constituents of the city. It is even more deplorable that it was a case of a street-digging in a side street which caused the accident in the so-called 'premier city'.

Remote cause, distinguished from Proximate case

Gabeto vs. Araneta

G.R. No. 15674 (1921)

Facts: On Aug. 4, 1918, Basilio Ilano and Proceso Gayetano rode a carromata (horse driven carriage) to go to a cockpit on Calle Ledesma in the city of Iloilo. Agaton Araneta stepped out into the street and stopped the horse. Araneta protested to the driver that he was the first one who called for the carromata. The driver Julio Pagnaya pulled on the reins (one which control the horse) of the bridle to free the horse from the control of Araneta. Due to the rottenness of the reins, the bit (placed on the horse’s mouth for control) came out of the horse’s mouth. Pagnaya got off the carromata and pulled over the same near the curb and fixed the bit. While doing so, the horse moved forward and pulled one wheel of the carromata uo on the sidewalk and pushed Pagnaya. The carromata struck a police telephone box and due to the crashing sound, the horse got frightened and set out at full speed up the street.

Basilio Ilano was able to get off the carromata but Proceso Gayetano retained his seat and when he jumped from the rig, he sustained injuries which caused his death.

Issue: Whether or not the act of Araneta is the proximate cause of the death of Gayetano.

Held: No. The mere act of Araneta of stopping the horse will not make him liable. Evidence shows that when Pagnaya got out of the carromata to go the horse’s head and fix the bit, an appreciable interval of time elapsed. The act of Araneta is too remote from the accident to be considered as the proximate cause.

By getting off and taking his post at the head of the horse, the driver was the person primarily responsible for the control of the animal. Also, evidence shows that the bridle was old and the leather is weak and easily broken.

Urbano vs. IAC

G.R. No. L-72964 (1988)

Facts: Supra

Held: There is a likelihood that the wound was but the remote cause and its subsequent infection, for failure to take necessary precautions, with tetanus may have been the proximate cause of Javier's death with which the petitioner had nothing to do. As we ruled in Manila Electric Co. v. Remoquillo, et al. (99 Phil. 118).

"A prior and remote cause cannot be made the be of an action if such remote cause did nothing more than furnish the condition or give rise to the occasion by which the injury was made possible, if there intervened between such prior or remote cause and the injury a distinct, successive, unrelated, and efficient cause of the injury, even though such injury would not have happened but for such condition or occasion. If no danger existed in the condition except because of the independent cause, such condition was not the proximate cause. And if an independent negligent act or defective condition sets into operation the instances which result in injury because of the prior defective condition, such subsequent act or condition is the proximate cause." (45 C.J. pp. 931-932). (at p. 125)

Concurrent Cause, distinguished from Proximate

Far Eastern Shipping Co. vs. Court of Appeals

G.R. 130068 (1998)

Facts: Supra

Held: It may be said, as a general rule, that negligence in order to render a person liable need not be the sole cause of an injury. It is sufficient that his negligence, concurring with one or more efficient causes other than piaintiff's, is the proximate cause of the injury. Accordingly, where several causes combine to produce injuries, a person is not relieved from liability because he is responsible for only one of them, it being sufficient that the negligence of the person charged with injury is an efficient cause without which the injury would not have resulted to as great an extent, and that such cause is not attributable to the person injured. It is no defense to one of the concurrent tortfeasors that the injury would not have resulted from his negligence alone, without the negligence or wrongful acts of the other concurrent rortfeasor. Where several causes producing an injury are concurrent and each is an efficient cause without which the injury would not have happened, the injury may be attributed to all or any of the causes and recovery may be had against any or all of the responsible persons although under the circumstances of the case, it may appear that one of them was more culpable, and that the duty owed by them to the injured person was not the same. No actor's negligence ceases to be a proximate cause merely because it does not exceed the negligence of other actors. Each wrongdoer is responsible for the entire result and is liable as though his acts were the sole cause of the injury.

There is no contribution between joint tortfeasors whose liability is solidary since both of them are liable for the total damage. Where the concurrent or successive negligent acts or omissions of two or more persons, although acting independently, are in combination the direct and proximate cause of a single injury to a third person, it is impossible to determine in what proportion each contributed to the injury and either of them is responsible for the whole injury. Where their concurring negligence resulted in injury or damage to a third party, they become joint tortfeasors and are solidarily liable for the resulting damage under Article 2194 of the Civil Code.

Subido vs. Custodio

L-21512 (Aug 31, 1966)

Facts: Agapito Custodio was a passenger of an LTB Bus. He was hanging on the left side of the bus because it was full of passengers. A truck owned by Subido which was coming from the opposite direction sideswiped the LTB bus and injured Custodio who died as a result thereof. Both drivers were found negligent- the LTB bus driver for having allowed a passenger to ride on the running board of the bus and the driver of the truck for running at a considerable speed while negotiating a sharp curb and running on the middle instead of on the right side of the road. The owner and the driver of the truck contended that the proximate cause of the death of Custodio was the negligence of the driver of the LTB bus who allowed Custodio to ride on the running board of the LTB bus.

Issue: Is there concurrent liability here in this case at bar? How does the negligence of both parties affect the liability of both?

Held: Although the negligence of the carrier (LTB bus) and its driver is independent, in its execution, of the negligence of the truck driver and its owner, both acts of negligence are the proximate cause of death of Agapito Custodio. In fact the negligence of the first two(2) would not have produced this result without the negligence of petitioners herein (the owner and driver of the truck). What is more, petitioner’s negligence was the last, in point of time, for Custodio was on the running board of the carrier’s bus sometime before petitioner’s truck came from the opposite direction, so that, in this sense petitioner’s truck had the last clear chance.” The owner and the driver of the truck were held jointly and severally liable, together with the LTB bus and its driver, to the heirs of Custodio.

TESTS of proximate cause- the “BUT FOR” test

Bataclan vs. Medina

102 Phil 181 Facts: supra

Held: There is no question that under the circumstances, the defendant carrier is liable. The only question is to what degree. The trial court was of the opinion that the proximate cause of the death of Bataclan was not the overturning of the bus, but rather, the fire that burned the bus, including himself and his co-passengers who were unable to leave it; that at the time the fire started, Bataclan, though he must have suffered physical injuries, perhaps serious, was still alive, and so damages were awarded, not for his death, but for the physical injuries suffered by him. We disagree. A satisfactory definition of proximate cause is found in Volume 38, pages 695-696 of American jurisprudence, cited by plaintiffs-appellants in their brief. It is as follows:

. . . 'that cause, which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces the injury, and without which the result would not have occurred.' And more comprehensively, 'the proximate legal cause is that acting first and producing the injury, either immediately or by setting other events in motion, all constituting a natural and continuous chain of events, each having a close causal connection with its immediate predecessor, the final event in the chain immediately effecting the injury as a natural and probable result of the cause which first acted, under such circumstances that the person responsible for the first event should, as an ordinary prudent and intelligent person, have reasonable ground to expect at the moment of his act or default that an injury to some person might probably result therefrom.

It may be that ordinarily, when a passenger bus overturns, and pins down a passenger, merely causing him physical injuries, if through some event, unexpected and extraordinary, the overturned bus is set on fire, say, by lightning, or if some highwaymen after looting the vehicle sets it on fire, and the passenger is burned to death, one might still contend that the proximate cause of his death was the fire and not the overturning of the vehicle. But in the present case under the circumstances obtaining in the same, we do not hesitate to hold that the proximate cause was the overturning of the bus, this for the reason that when the vehicle turned not only on its side but completely on its back, the leaking of the gasoline from the tank was not unnatural or unexpected; that the coming of the men with a lighted torch was in response to the call for help, made not only by the passengers, but most probably, by the driver and the conductor themselves, and that because it was dark (about 2:30 in the morning), the rescuers had to carry a light with them, and coming as they did from a rural area where lanterns and flashlights were not available; and what was more natural than that said rescuers should innocently approach the vehicle to extend the aid and effect the rescue requested from them. In other words, the coming of the men with a torch was to be expected and was a natural sequence of the overturning of the bus, the trapping of some of its passengers and the call for outside help. What is more, the burning of the bus can also in part be attributed to the negligence of the carrier, through is driver and its conductor.

Substantial Factor Test

Philippine Rabbit vs. IAC and Casiano Pascua et al.

G.R. No. 6 6102-04 (August 30, 1990)

Facts: On the eve of Christmas 1966, seven passengers boarded a jeepney bound for Pangasinan via Dau. Manalo drove the jeep owned by Magune and Carreon. Reaching Tarlac, the right wheel of the jeep was detached resulting to its 180 degree turn invading the other lane with the jeep’s front facing south. The bus driven by Del Rosario collided with the jeepney resulting in the death of three passengers and physical injuries to some. Manalo was convicted of Multiple Homicide and Serious Physical Injuries. Manalo did not appeal. Three Civil Cases fro Damages docketed 1136; 39-40 was filed anchored on the contractual liability of the jeepney owner and Philippine Rabbit’s liability based on quasidelict. Trial court decided against the jeepney operator as well as the joint liability of his Insurance Agency for Actual and Moral Damages. The Trial Court based its decisions on the following:

(1) Testimony of passenger Pascua alleging that the driver was running really fast. (2) Unrebutted testimony of Police Inspector on the sharp angle track marks of the jeep; the observation of the skid marks. (3) Manalo’s Conviction on the Criminal Compalint (4)Application of Res Ipsa Loquitor, attesting to the collision happening on the right of way of the bus.

CA reversed decision. It ordered Plaintiff bus operator and driver to pay jointly and severally the damages awarded. It based its decisions primarily on 1.) the doctrine of last clear chance. 2.) presumption of the responsibility of the vehicle on the rear end to avoid collision with the vehicle in front. 3.) the substantial test concluding Bus driver negligent by not making an effort to avoid accident and being the physical force causing the injury and death of passengers.

Issue: Who has liability over the injuries and death of victims?

Held: The proximate cause of the accident was the negligence of the jeepney operator for failure to exercise precautions needed. The carrier is presumed to have been at fault unless it is caso fortuito or that he has observed extra-ordinary diligence as provided in Articles 1733,55-56. Negligence was proven based on the testimony-evidences adduced by the trial court.

Last clear chance cannot be applied. It does not aride where a passenger demands responsibility under culpa contractual. A negligent driver and its owner cannot be exempted on the ground that the other party was likewise guilty of negligence. The substantial factor test is testing whether the actor’s conduct is a substantial factor in bringing about harm to another. THE FACT THAT THE ACTOR NEITHER FORESAW NOR SHOULD HAVE FORESEEN THE EXTENT OF HARM OR MANNER IN WHICH THE EVENT

OCCURRED DOES NOT PREVENT HIS LIABILITY. However, this test does not apply. The court does not fault Reyes for not having avoided such sicne no other options are available to him. The other lane even though empty was narrow and covered with tall grass. The wheels of the bus were also clear of the roadwasy except the outher left that hit the jeep. This clearly shows the attempt to hit the jeep. Inability to avoid the jeep must have been due to the limitations of options.

IAC decision is set aside. The Trial Court decision is Reinstated with Modification that only the Operator and the Insurance Company is liable for the victims and heirs. The driver cannot be held jointly and severally liable with the carrier in Breach of Contract as provided in Article 2180 and to make driver jointly and severally liable is to make the carrier’s liability a personal one and not explicit.

Cause v. Condition

Phoenix Construction vs. IAC

148 SCRA 353 (Mar 10, 1987)

Facts: Supra

Held: Cause and condition. Many courts have sought to distinguish between the active "cause" of the harm and the existing "conditions" upon which that cause operated. If the defendant has created only a passive static condition which made the damage possible, the defendant is said not to be liable. But so far as the fact of causation is concerned, in the sense of necessary antecedents which have played an important part in producing the result it is quite impossible to distinguish between active forces and passive situations, particularly since, as is invariably the case, the latter are the result of other active forces which have gone before.

The defendant who spills gasoline about the premises creates a "condition," but the act may be culpable because of the danger of fire. When a spark ignites the gasoline, the condition has done quite as much to bring about the fire as the spark; and since that is the very risk which the defendant has created, the defendant will not escape responsibility. Even the lapse of a considerable time during which the "condition" remains static will not necessarily affect liability; one who digs a trench in the highway may still be liable to another who fans into it a month afterward. "Cause" and "condition" still find occasional mention in the decisions; but the distinction is now almost entirely discredited. So far as it has any validity at all, it must refer to the type of case where the forces set in operation by the defendant have come to rest in a position of apparent safety, and some new force intervenes. But even in such cases, it is not the distinction between "cause" and "condition" which is important but the nature of the risk and the character of the intervening cause.

Manila Electric Co. vs. Remoquillo

G.R. No. L-8328 (1956)

Facts: Efren Magno went to the 3-story house of his stepbrother to repair a "media agua" said to be in a leaking condition. The "media agua" was just below the window of the third story. Magno received from his son thru that window a galvanized iron sheet to cover the leaking portion, turned around and in doing so, the lower end of the iron sheet came into contact with the electric wire of the Manila Electric Company. He died by electrocution.

His widow and children filed suit to recover damages from the electric company.

Issue: Were the acts of Magno the proximate or the remote cause of the incident.

Held: Magno’s acts were the proximate cause. It is clear that the principal and proximate cause of the electrocution was not the electric wire, evidently a remote cause, but rather the reckless and negligent act of Magno in turning around and swinging the galvanized iron sheet without taking any precaution. Magno was expected, as a person who is deemed a professional in his line of work, to have looked back toward the street and at the wire to avoid contacting with the iron sheet, the same being length of 6 feet. For a better understanding of the rule on remote and proximate cause with respect to injuries, the following citation is helpful:

"A prior and remote cause cannot be made the basis of an action if such remote cause did nothing more than furnish the condition or give rise to the occasion by which the injury was made possible, if there intervened between such prior or remote cause and the injury a distinct, successive, unrelated, and efficient cause of the injury, even though such injury would not have happened but for such condition or occasion. If no danger existed in the condition except because of the independent cause, such condition was not the proximate cause. And if an independent negligent act or defective condition sets into operation the circumstances which result in injury because of the prior defective condition, such subsequent act or condition is the proximate cause." (45 C. J. pp.

931-332.).

Furthermore, the owner of the house disregarded a city ordinance, declaring illegal the length of less than 3 feet distance between a building and the electric pole. And added to this violation, was its approval by the city through its agent, possibly an inspector. The electric company cannot be expected to be always on the lookout for any illegal construction which reduces the distance between its wires and said construction, and after finding that said distance of 3 feet had been reduced, to change the stringing or installation of its wires so as to

preserve said distance. It would be much easier for the City, or rather it is its duty, to be ever on the alert and to see to it that its ordinances are strictly followed by house owners and to condemn or disapprove all illegal constructions.

Of course, in the present case, the violation of the permit for the construction of the "media agua" was not the direct cause of the accident. It merely contributed to it. And contrary to the case of Astudillo vs. Manila electric, in the case at bar, the construction cannot be said to be a public place as it is a private construction. The deceased person was also a person of age who is expected to be more careful and knowledgeable as to what he is doing.

Rodrigueza vs. Manila Railroad Co.

G.R. No.15688 (November 19, 1921)

Facts: Manila Railroad Co. operates a line through the district of Daraga. As one of its trains passed over the line, sparks were emitted from the smokestack of the locomotive, and fire was communicated to four houses nearby, and they were entirely consumed. All of these houses were of light construction except that of Rodrigueza’s, which was of strong materials, though the roof was covered with nipa and cogon. The fire occurred immediately after the passage of the train, and a strong wind was blowing it. It doesn’t appear whose house caught fire first, though Manila railroad claimed that it was first communicated to Rodrigueza’s house and spread to the others. The plaintiffs claim that Manila Railroad was negligent in the following manners: a. in failing to exercise proper supervision over the employees in charge of the locomotive; b. in allowing the locomotive which emitted these sparks to be operated without having the smokestack protected by some device for arresting sparks; c. in using in its locomotive Bataan fuel, a fuel of known inferior quality which upon combustion, produces sparks in great quanity. Manila Railroad, on the other hand, argued that Rodrigueza’s house stood partly within the limits of the land owned by it, thogh exactly how far away from the company’s track does not appear. It also claimed of notifying Rodrigueza to get his house off the land of the company, and that Rodrigueza did not comply.

Issue: Who should be liable?

Held: Manila Railroad should be liable. Whether or not the fire may have been communicated through Rodrigueza’s house, or directly from the locomotive is immaterial. With regards to the position of Rodrigueza’s house, there is no proof that Rodrigueza unlawfully intruded upon the railroad’s property in the act of building his house. Rodrigueza may have assumed the risk of loss that might have resulted from fires occasioned by the defendant’s locomotives if operated and managed with ordinary care. But he cannot be held to have assumed the risk of any damage that might result from the unlawful negligent acts of Manila Railroad. Nobody is bound to anticipate and defend himselfagainst the possible negligence of another. The circumstances cannot be imputed to him as contributory negligence destructive of his right of action because, a) that condition was not created by himself, b) his house remained on the ground by toleration and therefore with the consent of the Railroad co., and c) even supposing the house to be improperly there, this fact would not justify the defendant company in negligently destroying it.

Efficient Intervening Cause

McKee vs. IAC

211 SCRA 517 (68102) (1992)

Facts: A cargo truck driven by Ruben Galang and owned by private respondents Tayag and Manalo was travelling southward from Angeles City to San Fernando, Pampanga, bound for Manila. On the other hand, a Ford Escort car driven by Jose Koh, was on its way to Angeles City from San Fernando. When the northbound car was about 10 meters away from the southern approach of the bridge, 2 boys suddenly darted from the right side of the road and into the lane of the car. The boys were moving back and forth, unsure of whether to cross all t he way to the other side or turn back.

Jose Koh blew the horn of the car, swerved to the left and entered the lane of the truck; he then switched on the headlights of the car, applied the brakes and thereafter attempted to return to his lane. Before he could do so, his car collided with the truck. The collision occurred in the lane of the truck, which was the opposite lane, on the said bridge. The said collision resulted to the death of Jose Koh, Kim Koh McKee, and Loida Bondoc, and physical injuries to George Koh McKee, Christopher Koh McKee, and Araceli Koh McKee, all passengers of the Ford Escort. In the statement of Ruben Galang to the investigating police officers immediately after the accident, he admitted that he was travelling at 30 miles per hour (48 kph).

Two civil cases for damages were filed before the CFI of Pampanga. The first civil case was for damages for the death of Jose Koh. The second civil case, on the other hand, was for the damages for the death of one and a half year old Kim Koh McKee and the physical injuries sustained by George and Araceli. About a month later, a charge of reckless imprudence resulting to multiple homicide, physical injuries and damage to property was filed against Ruben Galang and was raffled in the same court where the second civil case was assigned. In their Answer with Counterclaim for the first civil case, private respondents asserted that it was the Ford Escort car which "invaded and bumped the lane of the truck driven by Ruben Galang and, as counterclaim, prayed for the award of attorney's fees, actual and liquidated damages, moral damages and business losses.

In the second civil case, private respondents first filed a motion to dismiss on grounds of pendency of another action and failure to implead an indispensable party, Ruben Galang, the truck driver; they also filed a motion to consolidate the case with the first civil case pending before Branch III of the same court, which was opposed by the plaintiffs. Both motions were denied by Judge Capulong. In the criminal case, a judgment of conviction was rendered against Ruben Galang. Subsequently, Judge Mario Castañeda, Jr. dismissed the two

(2) civil cases and awarded the private respondents moral damages, exemplary damages and attorney's fees. Ruben Galang appealed the judgment of conviction but it was affirmed. Plaintiffs (McKee) on the other hand, appealed the dismissal of the civil cases to the appellate court.

The appellate court reversed the decision of the trial court. The decision is anchored principally on the respondent Court's findings that it was Ruben Galang's inattentiveness or reckless imprudence which caused the accident. The appellate court further said that the law presumes negligence on the part of the defendants (private respondents), as employers of Galang, in the selection and supervision of the latter; it was further asserted that these defendants did not allege in their Answers the defense of having exercised the diligence of a good father of a family in selecting and supervising the said employee. Private respondents filed a motion for reconsideration alleging improper appreciation of facts and on the basis of which, respondent court affirmed the trial court's decision in dismissing the civil cases. Petitioners filed a motion for reconsideration but was denied. Hence, this petition.

Issue: Whether or not Jose Koh's negligence was the proximate cause of the accident.

Held: NO. The respondent Court held that the fact that the car improperly invaded the lane of the truck and that the collision occurred in said lane gave rise to the presumption that the driver of the car, Jose Koh, was negligent. On the basis of this presumed negligence, the appellate court immediately concluded that it was Jose Koh's negligence that was the immediate and proximate cause of the collision.

This is an unwarranted deduction as the evidence for the petitioners convincingly shows that the car swerved into the truck's lane because as it approached the southern end of the bridge, two boys darted across the road from the right sidewalk into the lane of the car. Jose Koh's entry into the lane of the truck was necessary in order to avoid what was, in his mind at that time, a greater peril-death or injury to the two boys. Such act can hardly be classified as negligent. No negligence could be imputed to Jose Koh. Any reasonable and ordinary prudent man would have tried to avoid running over the two boys by swerving the car away from where they were even if this would mean entering the opposite lane. Avoiding such immediate peril would be the natural course to take particularly where the vehicle in the opposite lane would be several meters away and could very well slow down, move to the side of the road and give way to the oncoming car.

Moreover, under what is known as the e mergency rule, "one who suddenly finds himself in a place of danger, and is required to act without time to consider the best means that may be adopted to avoid the impending danger, is not guilty of negligence, if he fails to adopt what subsequently and upon reflection may appear to have been a better method, unless the emergency in which he finds himself is brought about by his own negligence." Although it may be said that the act of Jose Koh, if at all negligent, was the initial act in the chain of events, it cannot be said that the same caused the eventual injuries and deaths because of the occurrence of a sufficient intervening cause, the negligent act of the truck driver, which was t he actual cause of the tragedy. The entry of the car into the lane of the truck would not have resulted in the collision had the latter heeded the emergency signals given by the former to slow down and give the car an opportunity to go back into its proper lane. Instead of slowing down and swerving to the far right of the road, which was the proper precautionary measure under the given circumstances, the truck driver continued at full speed towards the car.

Moreover, the truck driver's negligence is apparent in the records. He himself said that his truck was running at 30 miles (48 kilometers) per hour along the bridge while the maximum speed allowed by law on a bridge is only 30 kilometers per hour. Under Article 2185 of the Civil Code, a person driving a vehicle is presumed negligent if at the time of the

mishap, he was violating any traffic regulation. Clearly, therefore, it was the truck driver's subsequent negligence in failing to take the proper measures and degree of care necessary to avoid the collision which was the proximate cause of the resulting accident.

E ven if Jose Koh was indeed negligent, the doctrine of last clear chance finds application here. Last clear chance is a doctrine in the law of torts which states that the contributory negligence of the party injured will not defeat the claim for damages if it is shown that the defendant might, by the exercise of reasonable care and prudence, have avoided the consequences of the negligence of the injured party. In such cases, the person who had the last clear chance to avoid the mishap is considered in law solely responsible for the

consequences thereof

Manila Electric vs. Remonquillo

G.R. No. L-8328 (1956)

Facts: Supra

Held: A prior and remote cause cannot be made the basis of an action if such remote cause did nothing more than furnish the condition or give rise to the occasion by which the injury was made possible, if there intervened between such prior or remote cause and the injury a distinct, successive unrelated, and efficient cause of the injury, even though such injury would not have happened but for such condition or occasion. If no danger existed in the condition except because of the independent cause, such condition was not the proximate cause. And if an independent negligent act or defective condition sets into operation the circumstances which result in injury because of the prior defective condition, such subsequent act or condition is the proximate cause. (45 C.J. p. 931.)

Teague vs. Fernandez

51 SCRA 181 (L-29745) (1973)

NOTE: To easily remember, call this the “Maghulos dili” ka case.

Facts: Realistic Institute is a vocational school for hair and beauty culture owned and operated by defendant. It is located at the 2 floor of Gil-Armi Building. A fire broke out 10 meters

away from the building. The students upon seeing the fire panicked. The six instructresses tried to calm them down. Mrs. Prieto, one of the instructresses even slapped three students to q uiet them down. The panic could not be subdued, thereby causing a stampede. No part of the building was burned. But after the panic was over, four students including Lourdes Fernandez, sister of plaintiffs were found dead.

Deceased’s five brothers and sisters filed an action for damages against Teague, as owner and operator of Realistic Institute. CFI dismissed the case. CA reversed, and awarded damages of P11,000. CA held that defendant’s negligence was the proximate cause of Hernandez’ death. The negligence was primarily predicated on the violation of the city ordinance of Manila, which consisted in the fact that the second storey of the Gil-Armi building had only one stairway, 1.5 meters wide, instead of two of at least 1.2 meters each, although at the time of the fire the owner of the building had a second stairway under construction. Hence a petition for review was filed in SC.

Issue: Are there independent causes/efficient intervening causes?

Held: None. The panic and stampede cannot be considered efficient intervening causes. It is true that the petitioner’s non-compliance with the ordinance was ahead and prior to the other events in point of time, in the sense that it was contemporaneous with its occupancy of the building. But the violation was a continuing one, since the ordinance was a measure of safety designed to prevent a specific situation which would pose a danger to the occupants of the building. That situation was undue overcrowding in case it should become necessary to evacuate the building, which, it could be reasonably foreseen, was bound to happen under emergency conditions if there was only one stairway available.

The violation of a statute or ordinance is not rendered remote as the cause of an injury by the intervention of another agency if the occurrence of the accident, in the manner in which it happened was the very thing which the statute or ordinance was intended to prevent.

Urbano vs. IAC

G.R. No. L-72964 (1988)

Issue: Whether or not there was an efficient intervening cause from the time Javier was wounded until his death which would exculpate Urbano from any liability for Javier's death.

Held: Medically speaking, the reaction to tetanus found inside a man's body depends on the incubation period of the disease. In the case at bar, Javier suffered a 2-inch incised wound on his right palm when he parried the bolo which Urbano used in hacking him. This incident took place on October 23, 1980. After 22 days, or on November 14, 1980, he suffered the symptoms of tetanus, like lockjaw and muscle spasms. The following day, November 15, 1980, he died.

If, therefore, the wound of Javier inflicted by the appellant was already infected by tetanus germs at the time, it is more medically probable that Javier should have been infected with only a mild cause of tetanus because the symptoms of tetanus appeared on the 22nd day after the hacking incident or more than 14 days after the infliction of the wound. Therefore, the onset time should have been more than six days. Javier, however, died on the second day from the onset time. The more credible conclusion is that at the time Javier's wound was inflicted by the appellant, the severe form of tetanus that killed him was not yet present. Consequently, Javier's wound could have been infected with tetanus after the hacking incident. Considering the circumstance surrounding Javier's death, his wound could have been infected by tetanus 2 or 3 or a few but not 20 to 22 days before he died.

The rule is that the death of the victim must be the direct, natural, and logical consequence of the wounds inflicted upon him by the accused. (People v. Cardenas, supra) And since we are dealing with a criminal conviction, the proof that the accused caused the victim's death must convince a rational mind beyond reasonable doubt. The medical findings, however, lead us to a distinct possibility that the infection of the wound by tetanus was an e fficient intervening cause later or between the time Javier was wounded to the time of his death. The infection was, therefore, distinct and foreign to the crime. (People v. Rellin, 77 Phil. 1038).

Last Clear Chance

Picart vs. Smith

37 Phil 809 (March 15, 1918)

Facts: Supra. Note: This is the first time the doctrine of last clear chance was introduced in Philippine Jurisprudence.

Held: The last clear chance was passed unto the defendant driving the automobile. It was his duty to bring the car to an immediate stop or upon seeing no other persons were on the bridge to take the other side and pass far away from the pony to avoid collision. Instead of doing this, Smith ran straight on until he was almost upon the horse. When Smith exposed the horse and rider to this danger he was negligent in the eye of the law. Under the circumstances, the law is that the person who has the last clear chance to avoid the impending harm and fails to do is chargeable with the consequences, without reference to the prior negligence of the other party. The existence of negligence in a given case is not determined by reference to

the personal judgment of the actor in the situation before him. The law considers what would be reckless, blameworthy, or negligent in the man of ordinary intelligence and prudence and determines liability by that.

Bustamante vs. Court Of Appeals

193 SCRA 603 (February 6, 1991)

Facts: A bus was traversing an inclined road. The bus driver saw, from 30 meters away, a sand and gravel truck fast approaching with its front wheels wiggling. The bus driver also

th rd

observed that the truck was heading towards his lane. Not minding this circumstance and believing that truck driver was merely joking, the bus driver shifted from 4 to 3 gear to gain

more power and speed in order to overtake a Kubota hand tractor being pushed by a person along the shoulder of the highway. All of this happened while the truck was descending and the bus was ascending the inclined part of the road. The two vehicles sideswiped each other at each other's left side ripping off the said wall of the bus from the driver's seat to the last rear seat.

Due to the impact, several passengers of the bus were thrown out and died as a result of the injuries they sustained. The heirs sued the respective owners and drivers of both the bus company and the truck. The trial concluded that the negligent acts of both drivers contributed to or combined with each other in directly causing the accident, thus the liability of the two drivers for their negligence is solidary.

The driver and owner of the truck appealed, the Court of Appeals, in resolving the motion for reconsideration, absolved the owner and driver of the truck based on the doctrine of last clear chance, saying that the bus driver had the last clear chance to avoid the accident and that it is his negligence which was the proximate cause of mishap.

Issue: Whether or not the doctrine of last clear chance is correctly applied.

Held: NO. The doctrine of Last Clear Chance is not applicable in this case.

The doctrine of last clear chance, stated broadly, is that—the negligence of the plaintiff does not preclude recovery for the negligence of the defendant where it appears that the defendant, by exercising reasonable care and prudence, might have avoided injurious consequences to the plaintiff notwithstanding the plaintiff's negligence. In other words, the doctrine of last clear chance means that even though a person's own acts may have placed him in a position of peril, and an injury results, the injured person is entitled to recovery.

The practical import of the doctrine is that a negligent defendant is held liable to a negligent plaintiff, if he (the defendant) were aware of the plaintiff’s peril, or should have been aware of it in the reasonable exercise of due care, had in fact an opportunity to avoid the accident. And this is true even if the plaintiff is grossly negligent.

The principle of last clear chance applies in a suit between the owners and drivers of colliding vehicles. It does not arise where a passenger demands responsibility f rom the carrier to enforce its contractual obligations. For it would be inequitable to exempt the negligent driver and its owners on the ground that the other driver was likewise guilty of negligence.

The Court is convinced that the respondent Court committed an error of law in applying the doctrine of last clear chance as between the defendants, since the case at bar is not a suit between the owners and drivers of the colliding vehicles but a suit brought by the heirs of the deceased passengers against both owners and drivers of the colliding v ehicles. Therefore, the respondent court erred in absolving the owner and driver of the cargo truck from liability.

Phoenix Construction Inc. vs. IAC

148 SCRA 353 (March 10, 1987)

NOTE: Emphasis is made on the obiter dictum.

FACTS: On November 15, 1975 (During the period of Martial Law) at approximately 1:30 AM, Leonardo Dionisio, driving his Volkswagen car, was on his way home to Makati from a cocktails-and-dinner meeting with his boss where had taken "a shot or two" of liquor.

Dionisio alleged that while he was crossing the intersection of General Lacuna and General Santos Streets in Bangkal, Makati, not far from his home, when his car’s headlights suddenly failed. He switched his headlights on "bright" and thereupon saw a Ford dump truck looming some two and a half meters away. The Ford dump truck, owned and operated by Phoenix Construction Inc. was p arked askew partly blocking and facing the way of incoming traffic. There were neither lights nor any so-called "early warning" devices or reflectors set anywhere near the dump truck. The dump truck had, earlier that evening, been driven home by Carbonel, its regular driver.

Dionisio claimed that he tried to avoid a collision by swerving his car to the left but it was too late and his car smashed into the dump truck. As a result of the collision, Dionisio suffered some physical injuries including some permanent facial scars, a "nervous breakdown" and loss of two gold bridge dentures.

Dionisio commenced an action for damages claiming that the legal and proximate cause of his injuries was the negligent manner in which Carbonel had parked the dump truck.

Phoenix and Carbonel countered that the proximate cause of Dionisio's injuries was his own recklessness in driving fast while under the influence of liquor, without his headlights on and without a curfew pass. Phoenix also sought to establish that it had exercised due care in the selection and supervision of the dump truck driver.

ISSUE: Whether or not the last clear chance doctrine should be applied, therefore exculpating Phoenix from paying damages.

HELD: No. The Supreme Court held that private respondent Dionisio's negligence was "only contributory," that the "immediate and proximate cause" of the injury remained the truck driver's "lack of due care" and that consequently Dionisio may recover damages though are subject to mitigation by the courts (Article 2179, Civil Code of the Philippines).

Obiter Dictum by Justice Feliciano:

Phoenix and Carbonel also ask us to apply what they refer to as the "last clear chance" doctrine. The theory here of petitioners is that while the petitioner truck driver was negligent, private respondent Dionisio had

the "last clear chance" of avoiding the accident and hence his injuries, and that Dionisio having failed to take that "last clear chance" must bear his own injuries alone. The last clear chance doctrine of the common law was imported into our jurisdiction by Picart vs. Smith but it is a matter for debate whether, or to what extent, it has found its way into the Civil Code of the Philippines.

The historical function of that doctrine of last clear chance was to mitigate the harshness of another common law doctrine— that of contributory negligence. The common law rule of contributory negligence prevented any recovery at all by a plaintiff who was also negligent, even if the plaintiff's negligence was relatively minor as compared with the

wrongful act or omission of the defendant.

The common law notion of last clear chance permitted courts to grant recovery to a plaintiff who had also been negligent provided that the defendant had the last clear chance to avoid the casualty and failed to do so. Accordingly, it is difficult to see what role, if any, the common law last clear chance doctrine has to play in a jurisdiction where the common law concept of contributory negligence as an absolute bar to recovery by the plaintiff, has itself been rejected, as it has been in article 2179 of the civil code.

Is there perhaps a general concept of "last clear chance" that may be extracted from its common law matrix and utilized as a general rule in negligence cases in a civil law jurisdiction like ours? We do not believe so. Under Article 2179, the task of a court, in technical terms, is to determine whose negligence-the plaintiff's or the defendant's-was the legal or proximate cause of the injury. That task is not simply or even primarily an exercise in chronology or physics, as the petitioners seem to imply by the use of terms like "last" or "intervening" or "immediate." The relative location in the continuum of time of the plaintiff's and the defendant's negligent acts or omissions, is only one of the relevant factors that may be taken into account.

Of more fundamental importance is the nature of the negligent act or omission of each party, and the character and gravity of the risks created by such act or omission for the rest of the community. The petitioners urge that the truck driver (and therefore his employer) should be absolved from responsibility for his own prior negligence because the unfortunate plaintiff failed to act with that increased diligence which had become necessary to avoid the peril precisely created by the truck driver's own wrongful act or omission. To accept this proposition is to come too close to wiping out the fundamental principle of law that a man must respond for the foreseeable consequences of his own negligent act or omission (NOTE: P arking the truck askew facing incoming traffic). Our law on quasi-delicts seeks to reduce the risks and burdens of living in society and to allocate them among the members of society. To accept the petitioners' proposition must tend to weaken the very bonds of Society.

NOTE: The point in assigning this case is for students to realize that the common law concepts of “last clear chance” and “contributory negligence” are counter-intuitive. Interestingly, contributory negligence in our jurisdiction does not mean that the plaintiff can no longer recover, but while he may recover, the liability of person ultimately responsible is mitigated. This is clearly visible from our treatment of contributory negligence in Art. 2179, which states:

Art. 2179. When the plaintiff's own negligence was the immediate and proximate cause of his injury, he cannot recover damages. But if his negligence was only contributory, the immediate and proximate cause of the injury being the defendant's lack of due care, the plaintiff may recover damages, but the courts shall mitigate the damages to be a warded. (n)

Philippine Bank Of Commerce vs. CA (Lipana)

269 SCRA 695 (March 14, 1997)

Issue: Whether the proximate cause of the loss is the bank's negligence or that of RMC’s.

Held: It was the negligence of PBCom’s teller, Ms. Azucena Mabayad, coupled by the negligence of the bank in the selection and supervision of its bank teller, which was the proximate cause of the loss. Proximate cause is that cause, which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces the injury, and without which the result would not have occurred.

The bank's teller, Ms. Azucena Mabayad, was negligent in validating, officially stamping and signing all the deposit slips presented by Ms. Yabut, notwithstanding that the duplicate copy was not completely accomplished contrary to PBCom’s SOP. In this case, were it not for the act of Ms. Mabayad, Ms. Irene Yabut would not have had the facility with which to perpetrate her fraudulent scheme.

Lastly, under the doctrine of "last clear chance" where both parties are negligent, but the negligent act of one is appreciably later in time than that of the other, or when it is impossible to determine whose fault or negligence should be attributed to the incident, the one who had the last clear opportunity to avoid the impending harm and failed to do so is chargeable with the consequences thereof.

In this case, assuming that private respondent RMC was negligent in entrusting cash to a dishonest employee, thus providing the latter with the opportunity to defraud the company, t he bank, thru its teller, had the last clear opportunity to avert the injury by faithfully observing their self-imposed validation procedure.

Considering, however, that the fraud was committed in a span of more than one (1) year covering various deposits, it cannot be denied that RMC was likewise negligent in not checking its monthly statements of account. Had it done so, the company would have been alerted of the series of frauds being committed by its secretary. Such omission by RMC is to be considered contributory negligence on its part, which shall mitigate the damages that may be awarded. AWARD: Of actual damages, RMC shall shoulder 40% of the loss, while PBCom shall pay 60% of the loss.

Glan People’s Lumber And Hardware vs. IAC

G.R. No. 70493 (May 18, 1989)

FACTS: Engineer Orlando T. Calibo was driving a Davao city-bound jeep owned by the Bacnotan Consolidated Industries, Inc. Also aboard the jeep were Agripino Roranes, and Maximo Patos.

A cargo truck driven by Paul Zacarias and loaded with cement bags, GI sheets and plywood was coming from the opposite direction and bound for South Cotabato. Just after the truck went across a bridge, it collided with the jeep and as a consequence, Engineer Calibo died while Roranes and Patos sustained physical injuries. Zacarias was unhurt.

As a result of the impact, the left side of the truck was slightly damaged while the left side of the jeep, including its fender and hood, was extensively damaged. After the impact, the jeep fell and rested on its right side on the asphalted road a few meters to the rear of the truck, while the truck was stopped on its wheels on the road.

A civil suit was filed by the wife of Calibo against Zacarias and the owner of the truck. The lower court dismissed the case, and accepted the argument that even if there was negligence on the part of Zacarias who intruded about 25 centimeters to the lane of Calibo, the latter had the last clear chance to avoid the accident.

The Court of Appeals reversed the decision on the ground that Zacarias saw the jeep already at about 150 meters and Zacarias did not have a driver’s license at the time of the

incident.

ISSUE: To whose negligence is the accident imputable?

HELD:. The evidence indicates that it was Engineer Calibo’s negligence that was the proximate cause of the accident. Assuming there was antecedent negligence on the part of Zacarias, Calibo had the last clear chance to avoid the accident.

Both drivers had a full view of each other's vehicle from a distance of one hundred fifty meters. Both vehicles were travelling at a speed of approximately thirty kilometers per hour. T he survivors of the jeep admitted that the truck was already at a full stop when they collided with it. The logical conclusion is that the driver of the jeep had the last clear chance to avoid the accident, while at that distance of thirty meters away from the truck, by stopping in his turn or swerving his jeep away from the truck, either of which he had sufficient time to do while running at a speed of only thirty kilometers per hour. In those circumstances, his duty was to seize that opportunity to avoid the mishap, not merely rely on a supposed right to expect the truck to swerve and leave him a clear path.

The doctrine of the last clear chance provides as a valid and complete defense to accident liability today as it did when invoked and applied in the 1918 case of Picart vs Smith.

Pantranco vs. Baesa

179 SCRA 384 (November 1989)

FACTS: On June 12, 1981, at approximately 7:00 o'clock in the morning, spouses Ceasar and Marilyn Baesa and their three children, along with spouses David Ico and Fe Ico, their son Erwin Ico and seven other persons, were onboard a passenger jeepney on their way to Malalam River, Isabela, to have a picnic in celebration of spouses Baesa’s fifth wedding anniversary. David Ico was driving.

Upon reaching the highway, the jeepney turned right at a speed of about 20 KPH. A speeding PANTRANCO bus from Aparri, on-route to Manila, encroached on the jeepney's lane while negotiating a curve, and collided with it. David Ico, spouses Ceasar Baesa and Marilyn Baesa and two of their children, died while the rest of the passengers sustained injuries. The jeepney is extensively damaged. The driver of the bus went into hiding, and has never been seen since.

Maricar Baesa through her guardian and Fe O. Ico filed separate actions for damages arising from quasi-delict against PANTRANCO. The other victims settled with Bus Company.

PANTRANCO, aside from pointing to the late David Ico's alleged negligence as the proximate cause of the accident, invoked the defense of due diligence in the selection and supervision of its driver, Ambrosio Ramirez.

ISSUE: Can PANTRANCO invoke the defense of Last Clear Chance?

HELD: No. Petitioner claims the driver of the jeepney had the last clear chance to avoid the collision and hence, was negligent in failing to utilize with reasonable care and competence the opportunity to avoid the harm.

The doctrine of the last clear chance simply, means that the negligence of a claimant does not preclude recovery for the negligence of defendant where it appears that the latter, by exercising reasonable care and prudence, might have avoided injurious consequences to claimant notwithstanding his negligence. The doctrine of "last clear chance" finds no application in this case. For the doctrine to be applicable, it is necessary to show that the person who had the last opportunity to avert the accident was aware of the existence of the peril or should, with exercise of due care, have been aware of it

In this case, there is nothing to show that the jeepney driver David Ico knew of the impending danger. When he saw at a distance that the approaching bus was encroaching on his lane, he did not immediately swerve the jeepney to the dirt shoulder on his right since he must have assumed that the bus driver will return to its own lane upon seeing the jeepney approach from the opposite direction.

Both the trial court and the Court of Appeals found that at the time of the accident the Pantranco bus was speeding towards Manila. At the time David Ico must have realized that the bus was not returning to its own lane, it was already too late to swerve the jeepney to his right to prevent an accident.

The Court held that the last clear chance doctrine "can never apply where the party charged is required to act instantaneously, and if the injury cannot be avoided by the a pplication of all means at hand after the peril is or should have been discovered"

Ong vs. Metropolitan Water District

G.R. No. L-7644 (August 29, 1958)

Facts: Metropolitan Water District owns and operates three swimming pools in Balara, Quezon City. It allows the public to use the pools for a fee.

Dominador Ong, a 14-year old boy, went to the pool with his two brothers. At about 4:35 p.m., Dominador told his brothers that he was going to the locker room in an adjoining building to drink a bottle of coke. Upon hearing this, Ruben and Eusebio Ong went to the bigger pool leaving Dominador in the small pool. Later that day, a bather reported that a person was underwater for too long. Upon hearing this, the lifeguard on duty dove into the pool to retrieve Ong’s lifeless body. Applying first aid, the lifeguard tried to revive the boy.

Soon after, nurse Armando Rule came to render assistance, followed by sanitary inspector Iluminado Vicente who, after being called by phone from the clinic by one of the security guards, boarded a jeep carrying with him the resuscitator and a medicine kit, and upon arriving he injected the boy with camphorated oil. After the injection, Vicente left on a jeep in order to fetch Dr. Ayuyao from the University of the Philippines. Meanwhile, Abaño continued the artificial manual respiration, and when this failed to revive him, they applied the resuscitator until the two oxygen tanks were exhausted.

The investigation revealed that the cause of death is asphyxia by submersion in water. The parents of Ong brought this action for damages against Metropolitan, alleging negligence on the selection and supervision of its employees and if not negligent, they had the last clear chance to revive Ong.

Issue: Whether or not Metropolitan is negligent in operating the pool.

Held: NO, Metropolitan is not negligent. Metropolitan has taken all necessary precautions to avoid danger to the lives of its patrons. The swimming pools are provided with a ring buoy, toy roof, towing line, oxygen resuscitator and a first aid medicine kit. The bottoms of the pools are painted black so as to insure clear visibility. On display in a conspicuous place are rules and regulations governing the use of the pools Metropolitan also employs six trained lifeguards, all of whom were issued certificates of proficiency.

These lifeguards work on schedule prepared by their chief and arranged in such a way as to have two guards at a time on duty to look after the safety of the bathers. There is a male nurse and a sanitary inspector with a clinic provided with oxygen resuscitator. And there are security guards who are available always in case of emergency.

The record also shows that when the body of minor Ong was retrieved from the bottom of the pool, the employees of Metropolitan did everything possible to revive him. When they found that the pulse of the boy was abnormal, the inspector immediately injected him with camphorated oil. When the manual artificial respiration proved ineffective they applied the oxygen resuscitator until its contents were exhausted. And while all these efforts were being made, they sent for Dr. Ayuyao from the University of the Philippines who however arrived late. All of the foregoing shows that Metropolitan has done all that is humanly possible under the circumstances to restore minor Ong’s life. For that reason it is unfair to hold it liable for his death

T HE LAST CLEAR CHANCE DOCTRINE IS INAPPLICABLE TO THIS CASE. The record does not show how minor Ong came into the big swimming pool. The doctrine of last clear chance simply means that the negligence of a claimant does not preclude a recovery for the negligence of defendant where it appears that the latter, by exercising reasonable care and prudence, might have avoided injurious consequences to claimant notwithstanding his negligence. Since it is not known how minor Ong came into the big swimming pool and it being apparent that he went there without any companion in violation of pool regulations and it appearing that lifeguard Abaño responded to the call for help as soon as his attention was called and immediately exhausted all efforts to bring him back to life, it is clear that there is no room for the application of the doctrine.

ANURAN vs. BUÑO

17 SCRA 224 (May 20, 1966)

FACTS: On January 12, 1958, a passenger jeepney, driven by Buño, was on the road to Taal, Batangas. It stopped to allow one of his passengers to alight. But the jeepney was parked in such a way that ½ of its width was on the asphalted pavement of the road and the other half, on the right shoulder of the said road. A motor truck speeding along, negligently bumped it from behind, which such violence that three of its passengers died, while two other passengers suffered injuries that required confinement in the Provincial Hospital.

The heirs of the dead and injured passengers filed a case against the respective drivers and owners of the truck and of the jeepney to recover damages. The Court of First Instance absolved the driver of the jeepney and its owners, but it ordered the truck driver and the owners to pay damages. Plaintiffs appealed to the Court of Appeals insisting that the driver and the owners of the jeepney should also be made liable for damages.

ISSUE: Whether or not the driver and owners of the jeepney should also be made liable.

HELD: YES. It must be remembered that the degree of diligence required of a carrier in transporting its passengers is “utmost diligence” (Art. 1755) and consequently, they are “presumed to have been at fault or to have acted negligently, unless they prove that they have observed extraordinary diligence” (Art. 1756). In this instance, this legal presumption of negligence is confirmed by the appellate court’s finding that the jeepney driver parked the vehicle improperly. It must follow that the driver – and the owners – of the jeepney must answer for injuries to its passengers.

Obiter dictum on Application of Principle of Last Clear Chance: The principle of “last clear chance” applies in a suit between the owners and drivers of the two colliding vehicles. It does not arise where a passenger demands responsibility from the carrier to enforce its obligations under a contract of carriage. For it would be inequitable to exempt the negligent driver of the jeepney and its owners on the ground that the other driver was likewise guilty of negligence. This principle does not apply in this case.

CANLAS vs. CA

G.R. No. 112160 (February 28 2000)

Facts: In August 1982, Osmundo S. Canlas, and Vicente Mañosca, decided to venture in business and to raise the capital needed therefor. Canlas executed a Special Power of Attorney authorizing Mañosca to mortgage two parcels of land situated in BF Homes, Paranaque. Each lot has a semi-concrete residential house in the name of the Canlas and his wife. Spouses Canlas agreed to sell the two lots to Mañosca, for and in consideration of PhP 850,000.00, P500,000.00 of which payable within one week, and the balance of PhP 350,000.00 shall serve as serve as Canlas’ investment in the business. Canlas delivered to Mañosca the transfer certificates of title of the two lots sold. Mañosca, on his part, issued two postdated checks in favorof Osmundo Canlas in the amounts of P40,000.00 and P460,000.00, respectively, but it turned out that the check covering the bigger amount was not sufficiently funded. In sum, the spouses Canlas received only PhP40,000.00, despite delivering the TCTs to the supposed vendee.

On September 1982, Mañosca, with the use of the SPA previously issued by Canlas, was able to secure a P100,000.00 loan from a certain Atty. Manuel Magno by mortgaging the same parcels of land, with the help of impostors who misrepresented themselves as the spouses Canlas. On September 29, 1982, Vicente Mañoscam, using the same parcels of land as security and through the involvement of the same impostors who again introduced themselves as the Canlas spouses, applied and was approved of another loan by Asian Savings Bank (ASB) in the amount of P500,000.00. When the loan was not paid, the bank, extra-judicially foreclosed the mortgage.

On January 1983, the spouses Canlas wrote a letter informing the bank that the execution of subject mortgage over the two parcels of land was without their authority. They requested that steps be taken to annul the questioned mortgage.

Issues: Is the mortgage with the bank valid? And if the answer is in the negative, should the bank bear the loss?

A contract of mortgage must be constituted only by the absolute owner on the property mortgaged; a mortgage, constituted by an impostor is void. Considering that it was established that the contract of mortgage was entered into and signed by impostors who misrepresented themselves as the spouses Canlas, the subject contract of mortgage is a complete nullity.

As to who shall bear the loss, T he doctrine of last clear chance is applicable, the respondent bank must suffer the resulting loss. In essence, the doctrine of last clear chance is to the effect that where both parties are negligent but the negligent act of one is appreciably later in point of time than that of the other, or where it is impossible to determine whose fault or negligence brought about the occurrence of the incident, the one who had the last clear opportunity to avoid the impending harm but failed to do so, is chargeable with the consequences arising therefrom. The respondent bank did not observe the required diligence in verifying the real identity of the couple who introduced themselves as the spouses Osmundo Canlas and Angelina Canlas. Not a single identification card was presented by the impostor-loan applicants to show their true identity. And yet the bank approved the loan on sheer finding that the signatures affixed on a deed of mortgage previously executed in favor of a certain Atty. Magno matched the signatures in the residence certificates presented by the impostors. In fact the deed of mortgage referred to did not bear the tax identification number of the spouses, as well as the Community Tax Certificate of Angelina Canlas.

Applying Art. 1173 It could be said that the degree of diligence required of banks is more than that of a good father of a family in keeping with their responsibility to exercise the n ecessary care and prudence in dealing even on a registered or titled property. Under such principle, the bank would be denied the protective mantle of the land registration law, accorded to purchasers or mortgagees for value and in good faith. Asian Savings Bank has to bear the loss.

Consolidated Bank vs. Court Of Appeals

G.R. No. 138569 (Sept. 11, 2003)

FACTS: LC Diaz and Co. (Diaz) is an accounting firm. Diaz has a savings account with Consolidated Bank (the predecessor of Solidbank). In 1991, Diaz, through its cashier, Macaraya, filled up a savings (cash) deposit slip for PhP900.00 and check deposit slip for PhP50.00. Macaraya instructed the firm’s messenger, Ismael Calapre, to deposit the money with Solidbank. Macaraya also gave Calapre the Solidbank passbook. Calapre went to Solidbank and presented to Teller No. 6 the two deposit slips and the passbook. Since the transaction took time and Calapre had to make another deposit for L.C. Diaz with Allied Bank, he left the passbook with Solidbank. When Calapre returned to Solidbank to retrieve the passbook, Teller No. 6 informed him that “somebody got the passbook.” Calapre went back to L.C. Diaz and reported the incident to Macaraya.

Macaraya, together with Calapre, went to Solidbank. When Macaraya asked for the passbook, Teller No. 6 told her that someone got the passbook but she could not remember to whom she gave it to. Failing to g retrieve the passbook, Macaraya returned to LC Diaz and reported the matter. The next day, L.C. Diaz’ CEO, Luis Diaz, called up the bank to stop any transaction involving the stolen passbook. Diaz learned that an unauthorized withdrawal of 300,000 was made on same day the passbook was stolen. The withdrawal slip bore the signatures of authorized signatories, who denied signing the same. A certain Noel Tamayo received the PhP300,000.

In 1992, Diaz demanded from Solidbank the return of his money. The trial court ruled in favor of the bank, saying that possession of the passbook raises the presumption of ownership and payments made upon production of the passbook shall have the same effect as if made to the depositor. Noel Tamayo, at the time of the withdrawal, had possession of the passbook and the withdrawal slip which bore signatures matching the specimen signatures in the bank. The trial court, using the rules on contractual obligations, said that the bank acted with care and observed the rules on savings account when it allowed the withdrawal , concluding that Diaz’s negligence was the proximate cause of the loss. The Court of Appeals reversed, saying that the teller of the bank should have been more careful in allowing the withdrawal. It said that although L.C. Diaz was negligent in allowing a messenger to make its deposits and said messenger left the passbook, by applying the last clear chance doctrine, the proximate cause of the loss is attributable to the bank.

Issue: Is the last clear chance doctrine applicable in this case? Who is the proximate cause of the loss?

Held: The rules on simple loan or mutuum apply in this case, hence, the bank was liable for breach of contract and not by virtue of a quasi-delict. Accordingly, the negligence of the bank is classified as Culpa contractual AND NOT Culpa Aquilana, and therefore, the Last clear chance doctrine is inapplicable. Because of a bank’s nature of business, a fiduciary relationship is deemed written into every deposit agreement. This imposes a higher degree of diligence than “a good father of a family”. While this does not convert the contract into a trust agreement, the law requires of banks a higher standard of integrity and performance in complying with its obligations under the contract.

While the passbook is in the bank’s hands, the law imposes a high degree of diligence in safeguarding the passbook. In culpa contractual, once the plaintiff proves breach on the part of the defendant, there is the presumption that the latter was negligent or at fault. The burden shifts to the defendant to prove that he was not negligent. But in culpa aquiliana, the p laintiff has the burden of proving the defendant’s negligence. Tellers must return the passbook only to the depositor or his authorized representative. Solidbank is bound by the negligence of its employees under the principle of respondeat superior. And the defense of exercising the diligence in the selection and supervision of employees is not a complete d efense in culpa contractual unlike in culpa aquiliana. Had the passbook not fallen into the hands of the impostor, the loss would not have occurred. Hence, the proximate cause of the loss the bank’s negligence in not returning the passbook to Calapre. But L.C. Diaz was guilty of contributory negligence in allowing a withdrawal slip signed by its authorized signatories to fall into the hands of an impostor. Thus, the liability of Solidbank should be reduced.

ENGADA vs. CA

G.R. No. 140698 (June 20, 2003)

FACTS: On November 29, 1989, at about 1:30 in the afternoon, Edwin Iran was driving a blue Toyota Tamaraw jeepney bound for Iloilo City. On board was Sheila Seyan, the registered owner of the Tamaraw. The Tamaraw passengers allegedly saw from the opposite direction a speeding Isuzu pick-up, driven by Rogelio Engada. When it was just a few meters away from the Tamaraw, the Isuzu pick-up’s right signal light flashed, at the same time, it swerved to its left, encroaching upon the lane of the Tamaraw and headed towards a head-on collision course with it. Seyan shouted at Iran to avoid the pick-up. Iran swerved to his left but the pick-up also swerved to its right. Thus, the pick-up collided with the Tamaraw, hitting the latter at its right front passenger side. The impact caused the head and chassis of the Tamaraw to separate from its body. Seyan was thrown out of the Tamaraw and landed on a ricefield. Seyan incurred P130,000 in medical expenses.

ISSUES

1. Whether or not the Last Clear Chance doctrine is applicable in favor of Engada.

HELD: No. It is a settled rule that a driver abandoning his proper lane for the purpose of overtaking another vehicle in an ordinary situation has the duty to see to it that the road is clear and he should not proceed if he cannot do so in safety. For failing to observe the duty of diligence and care imposed on drivers of vehicles abandoning their lane, petitioner must be held

liable. Edwin Iran could not be faulted when, in his attempt to avoid the pick-up, he swerved to his left.

E ngada’s acts placed Iran in an emergency situation which forced him to act quickly. An individual who suddenly finds himself in a situation of danger and is required to act without much time to consider the best means that may be adopted to avoid the impending danger, is not guilty of negligence if he fails to undertake what subsequently and upon reflection may appear to be a better solution, unless the emergency was brought by his own negligence.

The doctrine of last clear chance states that a person who has the last clear chance or opportunity to avoid an accident, notwithstanding the negligent acts of his opponent, is considered in law solely responsible for the consequences of the accident. However, the doctrine cannot be interposed in cases where the emergency rule applies. Iran swerved to the left only to avoid Engada’s pickup, which was already on a head-on path towards Iran’s Tamaraw jeepney. No convincing proof was adduced by Engada that Iran could have avoided a head- on collision.

Strict liability

Vestil vs. IAC

G.R. No. 74431 (November 6, 1989)

Facts: On July 29, 1975, Theness Tan Uy was bitten by a dog while she was playing with a child of Purita and Agustin Vestil in the house of the late Vicente Miranda, the father of

Purita. Thenese was rushed to the Hospital, where she was treated for "multipte lacerated wounds on the forehead" and administered an anti-rabies vaccine. She was discharged after nine

days but was readmitted a week later due to "vomiting of saliva." On August 15, 1975, the child died. The cause of death was certified as broncho-pneumonia.Theness developed

hydrophobia, a symptom of rabies, as a result of the dog bites, and asphyxia broncho-pneumonia, a complication of rabies, which ultimately caused her death.

The Uys sued for damages, alleging that the Vestils were liable as the possessors of the dog that bit and eventually killed their daughter. The Uys claim that the Vestils are liable

for the death of Theness, since they own the dog that bit her. While the Vestils contend that the dog belonged to the deceased Vicente Miranda, and that it was a tame animal, and that in

any case no one had witnessed it bite Theness.

Issue: Whether or not the Vestils are liable for the damage caused by the dog.

Held: ART. 2183 states “The possessor of an animal or whoever may make use of the same is responsible for the damage which it may cause, although it may escape or be lost. This

responsibility shall cease only in case the damage should come from force majeure or from the fault of the person who has suffered damage.”

The obligation imposed by Article 2183 of the Civil Code is not based on the negligence or on the presumed lack of vigilance of the possessor or user of the animal causing the damage. It is based on natural equity and on the principle of social interest that he who possesses animals for his utility, pleasure or service must answer for the damage which such

animal may cause.

While it is true that she is not really the owner of the house, which was still part of Vicente Miranda's estate, t here is no doubt that she and her husband were its possessors at

the time of the incident in question. The Vestils’ contention that they could not be expected to exercise remote control of the dog is not acceptable. In fact, Article 2183 of the Civil Code

holds the possessor liable even if the animal should "escape or be lost" and so be removed from his control. And it does not matter either that the dog was tame and was merely provoked

by the child into biting her. The law does not speak only of vicious animals but covers even tame ones as long as they cause injury. As for the belated allegations that Theness provoked the dog, the Vestils forget that the deceased was only three years old at the time she was attacked and can hardly be faulted for whatever she might have done to the animal.

There is evidence showing that Theness and her family regularly went to the house of the Vestils once or twice a week. The Court finds that the link between the dog bites and the certified cause of death has been satisfactorily established. The obligation imposed by Article 2183 of the Civil Code is not based on the negligence or on the presumed lack of vigilance of the possessor or user of the animal causing the damage. It is based on natural equity and on the principle of social interest that he who possesses animals for his utility,

pleasure or service must answer for the damage which such animal may cause.

Things thrown from a building

Dingcong vs. Kanaan

G.R. No. L-47033 (April 25, 1941)

Facts: The Dingcong brothers leased the upper floor of house owned by Emilia Saenz, where they established and managed the Central Hotel. A guest by the name of Francisco

Echivarria occupied Room No. 10 of the hotel for P30. Kanaan, on the other hand, occupies the ground floor the house of Saenz and where they established a store named "American

Bazaar" dedicated to the buy and sell of articles and merchandise.

Echivarria, before going to bed, let his faucet leak while the pipes of the hotel were undergoing repairs. A bucket was placed underneath the leaking faucet to catch the dripping

water, but still the bucket overflowed. Water seeped through the floor and the merchandise in the bazaar below got wet and caused damages worth around P1,000.00 (considerable

amount in 1941). The Kanaans brought an action for damages against the managers, the brothers Dingcong, and Echivarria. During trial one of the Dingcong brothers died, but suit continued against the surviving Dingcong.

Issue: Whether or not Jose Dingcong and Francisco Echevarria are liable for damages.

Held: Francisco Echevarria, the hotel guest, is liable for being the one who, by his negligence in leaving the faucet open, caused the water to spill on the ground and wet the articles and

merchandise of the Kanaans.

Jose Dingcong, the surviving co-renter and manager of the hotel, had complete possession of the house, and consequently must also be responsible for the damages caused. As a

co-lessee and manager of the hotel, the Dingcongs have to answer for the damage caused by things that thrown or falling from the hotel (Art. 1910 of the Codigo Civil).

The Dingcongs likewise failed to exercise the diligence of a good father of the family to prevent the damages. They knew that the pipes of the hotel were under repair, as

managers, they should have presumed that the guest Echivarria would use the faucet, but only provided a bucket to deal with the problem of the leaks.

Death/Injuries in the course of employment

Afable vs. Singer Sewing Machine Company

58 PHIL 14 (March 6, 1933)

Facts: Leopoldo Madlangbayan was a collector for the Singer Sewing Machine Company in the district of San Francisco del Monte, outside of the limits of the City of Manila. He was supposedly residing in his district according to the records of the company. His compensation was on a commission basis of eight percent on all collections made by him.

One Sunday, Leopoldo, while riding a bicycle, was ran over and killed in the City of Manila by a truck driven by Vitaliano Sumoay. It appears that Leopoldo had moved to

Teodora Alonso St. in Manila without notifying the company and that at the time of his death he was returning home after making some collections in San Francisco del Monte.

According to the practice of the company, if collectors made collections on Sunday they were required to deliver the amount collected to the company the next morning. The widow and

children of Leopoldo brought an action to recover from Singer under Act No. 3428 (Workmen’s Compensation Act)

Issue: May the heirs of Leopoldo recover from the corporation considering the nature of his employment and the manner of the injury?

Held: No. The accident which caused the death of the employee was not due to and in pursuance of his employment. At the time that he was run over by the truck, Leopoldo was not in

pursuance of his employment, but was on his way home after he had finished his work for the day and left the territory where he was authorized to make collections for the defendant.

The employer is not an insurer "against all accidental injuries which might happen to an employee while in the course of the employment", and as a general rule an employee is

not entitled to recover from personal injuries resulting from an accident that befalls him while going to or returning from his place of employment, because such an accident DOES

NOT arise out of and in the course of his employment.

"The words 'arising out of' refer to the origin or cause of the accident, and are descriptive of its character, while the words 'in the course of' refer to the time, place, and circumstances under which the accident takes place. By the use of these words it was not the intention of the legislature to make the employer an insurer against all accidental injuries

which might happen to an employee while in the course of the employment, but only for such injuries arising from or growing out of the risks peculiar to the NATURE of the work in the

scope of the workman's employment or incidental to such employment, and accidents in which it is possible to trace the injury to some risk or hazard to which the employee is exposed in

a special degree by reason of such employment. Risks to which all persons similarly situated are equally exposed and not traceable in some special degree to the particular

employment are excluded.

Furthermore, it appears that the deceased had never notified the defendant corporation of his change of residence from San Francisco del Monte to Manila, and that the company did not know that he was living in Manila on the day of the accident. Neither does the company did not require its employees to work on Sunday, or furnish or require its agents to u se bicycles. These are additional reasons for holding that the accident was not due to and in pursuance of the employment of the deceased. If the deceased saw fit to change his residence from San Francisco del Monte to Manila and to make use of a bicycle in going back and forth, he did so at his own risk, as the company did not furnish him a bicycle or require him to use one; and if he made collections on Sunday, he did not do so in pursuance of his employment, and his employer is not liable for any injury sustained by him.

Coca Cola Bottlers vs. Ca

G.R.No. 110295 (October 18, 1993)

Facts: Lydia Geronimo is the proprietress of a school canteen. On August 12, 1989, a group of parents complained before Geronimo that they found fibrous material in the bottles of Coke

and Sprite that their children bought from her store. Geronimo examined her stock and found that there were indeed fibrous materials in the unopened soda bottles. She brought the

bottles to the Department of Health Regional Office and was informed that the soda samples she sent were adulterated.

Because of this, the canteen had to close down due to the big drop in its sales of soft drinks. On Geronimo filed a complaint for damages against Coca cola. Coca-Cola moved to

dismiss the complaint on the grounds of failure to exhaust administrative remedies and prescription. According to Coca-Cola, under the law on sales on breach of warranty, more

particularly Article 1561 , the action should have been brought within six months from the delivery of the goods.

Coca cola moved to dismiss on the basis of failure to exhaust all administrative remedies and prescription. It contends that the existence of a contractual relation between the

parties (arising from the contract of sale) bars the application of the law on quasi-delicts and that since Geronimo’s cause of action arose from the breach of implied warranties, the

complaint should have been filed within six months from delivery of the soft drinks pursuant to Article 1571 of the Civil Code. Geronimo claims that the cause of action is based on injury to her right and can be brought within four years pursuant to Article 1146 of the civil code.

Issue: Has the action prescribed? Can Geronimo’s action based on quasi-delict exist despite the pre-existing contract of sale?

Held: While it may be true that the pre-existing contract between the parties may, as a general rule, bar the applicability of the law on quasi-delict, the liability may itself be deemed to

a rise from quasi-delict, i.e., the act which breaks the contract may also be a quasi-delict.

In Singson vs. Bank of the Philippine Islands," this Court stated: "We have repeatedly held, however, that the existence of a contract between the parties does not bar the

commission of a tort by the one against the other and the consequent recovery of damages therefor. Indeed, this view has been, in effect, reiterated in a comparatively recent case. Thus, in Air France vs. Carrascosa, involving an airplane passenger who, despite his first-class ticket, had been illegally ousted from his first-class accommodation and compelled to take a seat in the tourist compartment, was held entitled to recover damages from the air-carrier, upon the ground of tort on the latter's part, for, although the relation between the passenger and a carrier is contractual both in origin and nature x x x the act that breaks the contract may also be a tort.'''

Otherwise put, liability for quasi-delict may still exist despite the presence of contractual relations. Therefore, Geronimo has four years to file the case, reckoned from the time

the cause of action accrued.

Interference of Contractual Relations

Gilchrist vs. Cuddy, et al.

29 Phil 542 (February 18, 1915)

Facts: Cuddy was the owner of the film “Zigomar”. Gilchrist was the owner of a theatre in Iloilo. They entered into a contract whereby Cuddy leased to Gilchrist a movie entitled

“Zigomar” for exhibition in his theatre for a week for PhP125.

Days before the delivering the film, Cuddy returned the money already paid by Gilchrist so that he can lease the film to cinema owners Espejo and Zaldarriaga, who offered to pay a

higher price for lease of the film.

Gilchrist filed a case for specific performance with prayer for damages against Cuddy, Espejo and Zaldarriaga.

Issue: Whether such acts of Espejo and Zaldariaga were actionable and if so under what legal principle. Can Espejo and Zaldariaga their lack of evil motive use as defense by alleging that their intention was purely for business?

Held: The only motive for the interference with the Gilchrist - Cuddy contract on the part of the appellants was a desire to make a profit by exhibiting the film in their theater.There was

no malice beyond this desire; but this fact does not relieve them of the legal liability for interfering with that contract and causing its breach. Hence, they are liable to Gilchrist for the damages caused by their acts.

The liability of the Espejo and Zaldriagga arises from unlawful acts and not from contractual obligations, as they were under no such obligation to induce Cuddy to violate his

contract with Gilchrist. So that if the action of Gilchrist had been one for damages, it would be governed by chapter 2, title 16, book 4 of the Civil Code.

Article 1902 of that code provides that a person who, by act or omission, causes damages to another when there is fault or negligence, shall be obliged to repair the damage so

done.

There is nothing in this article which requires as a condition precedent to the liability of a tort-feasor that he must know the identity of a person to whom he causes damages. In fact, the chapter wherein this article is found clearly shows that no such knowledge is required in order that the injured party may recover for the damage suffered.

So Ping Bun vs. CA

GR No. 120554 (September 21, 1999)

FACTS: In 1963, Tek hua Trading, through its Managing Director So Pek Giok, entered into a lease agreement with Dee C. Chuan & Sons Inc. (DCCSI ) covering four stalls in Binondo.

The terms of the contract were initially for one year but after its expiry, they continued on a month to month basis.

In 1976, Tek Hua Trading was dissolved with the original members forming a new corporation named Tek Hua Enterprises, with Manuel Tiong as one of the incorporators. So

Ping Bun, on the death of his grandfather, So Pek Giok (Managing director of defunct Tek Hua Trading), occupied the same stalls for his own textile business under the name,

Trendsetter Marketing.

In 1989, the lessor, DCCSI sent letters to Tek Hua Enterprises advising that it will be increasing rent. Enclosed in both letters were new lease contracts for signing. While the

letters contained a statement that the leases will be terminated if the contracts were not signed, the same were not rescinded. In 1991, Manuel Tiong (incorporator of Tek Hua Enterrises)

wrote a letter to So Ping Bun asking him to vacate the four stalls:

Dear Mr. So,

Due to my closed (sic) business associate (sic) for three decades with your late grandfather Mr. So Pek Giok and late father, Mr. So Chong Bon, I allowed you temporarily to use the warehouse of Tek Hua Enterprising Corp. for several years to generate your personal business.

Since I decided to go back into textile business, I need a warehouse immediately for my stocks. Therefore, please be advised to vacate all your stocks in Tek Hua Enterprising Corp. Warehouse. You are hereby given 14 days to vacate the premises unless you have good reasons that you have the right to stay. Otherwise, I will be constrained to take measure to protect my interest.

Please give this urgent matter your preferential attention to avoid inconvenience on your part.

But instead of vacating the stalls, So Ping Bun was able to secure lease agreements in favor Trendsetter Marketing from D.C. Chuan. Tek Hua Enterprises filed a suit for injunction and

pressed for the nullification of the

lease contracts between DCCSI and So Ping Bun and as well prayed for damages.

ISSUE: Whether or not So Ping Bun was guilty of tortuous interference of contract.

HELD: Yes. The elements of tort interference are (a) existence of a valid contract (b) knowledge on the part of the third party of its existence (c) interference of the third party is

w ithout legal justification or excuse. Since there were existing lease contracts between DCCI and Tek Hua Enterprises, the latter had property rights over the leased stalls. The action of Trendsetter in asking DCCSI to execute the contracts in their favor was unlawful interference.

As to the question of whether the interference may be justified, the Supreme Court stated that it is sufficient that So Ping Bun’s conduct lies in a proper business interest

r ather than in wrongful motives to conclude. Nothing on the record imputes deliberate wrongful motives or malice on the part of So Ping Bun. Hence, while there is tortuous

Issue: Whether or not the City of Dagupan is liable for damages?

Ruling: Yes. The City of Dagupan is liable for damages. The liability of public corporations for damages arising from injuries suffered by pedestrians by reason of the defective

condition of roads is expressed in the Art. 2189 of Civil Code, which states:

Provinces, cities and municipalities shall be liable for damages for the death of, or injuries suffered by, any person by reason of the defective condition of roads, streets, bridges, public buildings,

and other public works under their control or supervision.

For liability to attach, it is not even necessary for the defective road or street to belong to the province, city or municipality. The article only requires that either control or supervision is

exercised over the defective road or street.

In the case at bar, this control or supervision is provided for in the charter of Dagupan City and is exercised through the City Engineer. This function of supervision over streets, public buildings, and other public works is coursed through a Maintenance Foreman and a Maintenance Engineer. Although these last two officials are employees of the National Government, they are detailed with the City of Dagupan and receive instruction and supervision from the city through the City Engineer.

The express provision in the charter holding the city not liable for damages or injuries sustained by persons or property due to the failure of any city officer to enforce the provisions of the charter, cannot be used to exempt the city from liability. The charter only lays down general rules regulating the liability of the city. On the other hand article 2189 applies in particular to the liability arising from "defective streets, public buildings and other public works.

Liability of Governmental Units

Worcester vs. Ocampo

22 PHIL 42 (Feb. 27, 1912)

Facts: Plaintiff, a former member of the Civil Commission and Secretary of the Interior of the Insular Government, commenced an action against the writers, owners, directors, editors

and administrators of the newspaper "El Renacimiento” (Muling Pagsilang) for recovery of damages resulting from an alleged libelous editorial. Worcester alleged that the article

attacked his integrity and reputation while he was in office. The editorial "BIRDS OF PREY” was in the form of a blind-item which though not directly pointing to the plaintiff was

alleged to charge the latter with malfeasance in office and criminal acts; with the prostitution of his office for personal ends; with wasting public funds for the purpose of promoting his

personal welfare; with the violation of the laws of the Philippine Islands and the ordinances of the city of Manila; with taking part in illegal combinations for the purpose of robbing the people; with the object of gain for himself and for others; and lastly with being "a bird of prey”, which, for Worcester, alluded to him as an eagle that surprises and devours, a vulture that gorges himself on dead and rotten meat, an owl that affects a petulant omniscience, and a vampire that sucks the blood of the victim until he leaves it bloodless.

After trial, the judge of the CFI rendered judgment in favor of Worcester, holding all the defendants (except for Reyes, Aguilar and Liquete who were found to be in

asubordinate position and found to have merely acted under the direction of their superiors) liable jointly and severally for moral and punitive damages

Defendants contend that the editorial "Birds of Prey" does not refer to a determinate person; and that, conceding that it does refer to the plaintiff, none of the defendants, except

Teodoro M. Kalaw, chief editor or director is responsible for the writing, printing, or publication of the alleged libelous article of the damages to the plaintiff resulting therefrom.

Issue: Whether or not the defendants are jointly and severally liable.]

Held:Yes. Joint tortfeasors are all the persons whocommand, instigate, promote, encourage, advise, countenance, cooperate in, aid or abet the commission of a tort, or who approve of it after it is done, if done for their benefit.

J oint tortfeasors are jointly and severally liable for the tort which they commit. They are each liable as principals, to the same extent and in the same manner as if they had

performed the wrongful act themselves. The defendants may have been sued separately for the commission of the tort or as it were here, might be sued jointly and severally. It is not necessary that the cooperation should be a direct, corporeal act. The person injured may sue all of them, or any number less than all. Each is liable for the whole damage caused by all, and altogether jointly liable for the whole damage. It is no defense for one sued alone, that the others who participated in the wrongful act are not joined with him as defendants; nor is it any excuse for him that his participation in the tort was insignificant as compared with that of the others. Joint tort feasors are not liable pro rata. The damages cannot be apportioned among them, except among themselves. They cannot insist paying an aliquot part. They are jointly and severally liable for the full amount.

J. H. Chapman vs. James M. Underwood

27 Phil 374 (March 28, 1914)

Facts: J.H. Chapman visited a man by the name of Creveling, in front of whose house the accident occurred. Chapman wanted to board a certain "San Marcelino" single-track street-car coming from Santa Ana and bound for Manila. Being told by Creveling that the car was approaching, he hurriedly, passed from the gate of Creveling’s home into the street for the

purpose of signaling and boarding the car. The car was a closed one, the entrance being from the front or the rear platform. Chapman attempted to board the front platform but, seeing that

he could not reach it without extra exertion, stopped beside the car, facing toward the rear platform, and waited for it to come within reach for him to board. While in this position, he was

struck from behind and run over by Underwood’s automobile.

Immediately prior to the incident, Underwood’s automobile, which was being driven by his chauffeur, followed behind a street car from Manila bound to Santa Ana (Opposite direction of the “San Marcelino” street-car that Chapman wanted to board). Just before reaching the scene of the accident, the street car being followed by Underwood took the switched off the main line to the left. Thereupon, Underwood’s automobile no longer followed that street-car nor went to the left, but either kept straight ahead on the main street-car track or a bit

decision in favor of the defendant.

Held: A careful examination of the record leads to the conclusion that the Underwood’s driver was guilty of negligence in running upon and over the plaintiff. He was passing an

incoming car upon the wrong side. The plaintiff, out to board the car, was not obliged to observe whether a car was coming upon him from his left hand. He had only to guard against those coming from the right. He knew that, according to the law of the road, no automobile or other vehicle coming from his left should pass upon his side of the car. He needed only to watch for cars coming from his right, as they were the only ones under the law permitted to pass upon that side of the street car.

Underwood, however, is not responsible for the negligence of his driver, under the facts and circumstances of this case. As stated in the case of Johnson vs. David (5 Phil. Rep.,

663), the driver does not fall within the list of persons in article 1903 of the Civil Code for whose acts the defendant would be responsible. The owner of an automobile who permits his chauffeur to drive up to Escolta, for example, at a speed of 60 miles an hour, without any effort to stop him, although he has had a reasonable opportunity to do so, becomes himself responsible, both criminally and civilly, for the results produced by the acts of his chauffeur. On the other hand, if the driver, by a sudden act of negligence, and without the owner

having a reasonable opportunity to prevent the acts or its continuance, injures a person or violates the criminal law, the owner of the automobile, although present therein at

the time the act was committed, is not responsible, either civilly or criminally, therefor. The act complained of must be continued in the presence of the owner for such a length a time

that the owner, by his acquiescence, makes his driver's act his own.

In this case, it DOES NOT appear that, from the time the automobile took the wrong side of the road to the commission of the injury, sufficient time intervened to give the defendant an opportunity to correct the act of his driver. Instead, it appears that the interval between the turning out to meet and pass the street car and the happening of the accident was

so small as not to be sufficient to charge defendant with the negligence of the driver.

Caedo vs. Yu Khe Thai

G.R. No. L-20392 December 18, 1968

Facts: On March 24, 1958 on Highway 54 (now E. de los Santos Avenue) in the vicinity of San Lorenzo Village, Marcial Caedo was driving his Mercury car. With them in the car were

Mrs. Caedo and three daughters. Coming from the opposite direction was the Cadillac of Yu Khe Thai, with his driver Rafael Bernardo at the wheel, taking the owner from his Parañaque

home to Wack Wack for his regular round of golf. The two cars were traveling at fairly moderate speeds, their headlights were mutually noticeable from a distance. Ahead of the

Cadillac, going in the same direction, was a caretella owned by Pedro Bautista. The carretela was towing another horse by means of a short rope coiled around the rig's vertical post on

the right side and held at the other end by Pedro's son, Julian Bautista.

Bernardo tried to overtake the carretela, instead of slowing down or stopping behind the carretela until the lane was clear. Its rear bumper caught the wheel of the carretela and

wrenched it loose, and the car skidded to the other lane. Caedo tried to avoid the collision at the last moment by going farther to the right, but was unsuccessful.

Caedo and his family members were injured. They filed a suit for recovery of damages from the defendants. The CFI Rizal rendered judgment in favor of the plaintiffs and

against the defendants, Yu Khe Thai and Rafael Bernardo.

ISSUE: Is Yu Khe Thai, as owner of the Cadillac, solidarily liable with the driver?

HELD: No. The applicable law is Article 2184 of the Civil Code:

ART. 2184. In motor vehicle mishaps, the owner is solidarily liable with his driver, if the former, who was in the vehicle, could have, by the use of due diligence, prevented the

misfortune. It is disputably presumed that a driver was negligent, if he had been found guilty of reckless driving or violating traffic regulations at least twice within the next preceding two months.

Under the foregoing provision, if the causative factor was the driver's negligence, the owner of the vehicle who was present is likewise held liable if he could have prevented the mishap

by the exercise of due diligence.

The basis of the master's liability in civil law is not respondent superior but rather the relationship of paterfamilias. The theory is that ultimately the negligence of the servant, if known to the master and susceptible of timely correction by him, reflects his own negligence if he fails to correct it in order to prevent injury or damage.

In the present case the defendants' evidence is that Rafael Bernardo had been Yu Khe Thai's driver since 1937, and before that had been employed by Yutivo Sons Hardware Co. in the same capacity for over ten years. During that time he had no record of violation of traffic laws and regulations. No negligence for having employed him at all may be imputed to his master.

The time element was such that there was no reasonable opportunity for Yu Khe Thai to assess the risks involved and warn the driver accordingly.

The law does not require that a person must possess a certain measure of skill or proficiency either in the mechanics of driving or in the observance of traffic rules before he may own a motor vehicle. The test of his intelligence, within the meaning of Article 2184, is his omission to do that which the evidence of his own senses tells him he should do in order to avoid the accident. And as far as perception is concerned, absent a minimum level imposed by law, a maneuver that appears to be fraught with danger to one passenger may appear to be entirely safe and commonplace to another. Were the law to require a uniform standard of perceptiveness, employment of professional drivers by car owners who, by their very inadequacies, have real need of drivers' services, would be effectively proscribed.

Felina Rodriguez-Luna vs. IAC

G.R. No. L-62988 (February 28, 1985)

Facts: Roberto R. Luna who was killed in a vehicular collision. The collision took place on January 18, 1970, at the go-kart practice area in Greenhills, San Juan, Metro Manila. Those

involved were the go-kart driven by the deceased, a business executive, and a Toyota car driven by Luis dela Rosa, a minor of 13 years who had no driver's license.

Luna's heirs brought a suit for damages against Luis and his father, Jose dela Rosa at the CFI Manila. The dela Rosas were sentenced to pay, jointly and severally, to the heirs the

sum of P1,650,000.00 as unearned net earnings of Roberto Luna, P12,000.00 as compensatory damages, and P50,000.00 for the loss of his companionship, with legal interest from the

date of this decision; plus attorney's fees in the sum of P50,000.00, and the costs of suit.

On appeal, the Court of Appeals affirmed in toto the decision of the trial court. However, upon a motion for reconsideration filed by the dela Rosa, the CA reduced the unearned

net earnings to P450,000.00.

ISSUES: (1) Did the court err in reducing the amount of unearned income? (2) Should the award for attorney's fees have legal interest?

HELD: (1)The award of P1,650,000.00 was based on two factors, namely: (a) that the deceased Roberto R. Luna could have lived for 30 more years; and (b) that his annual net income

was P55,000.00, computed at P75,000.00 annual gross income less P20,000.00 annual personal expenses. The CA sustained the trial court's conclusion with respect to Luna’s life

expectancy of 30 years and his annual income and expense.

In reducing Luna's life expectancy from 30 to 10 years, the CA said that his habit and manner of life should be taken into account, i.e. that he had been engaged in car racing as a

sport both here and abroad - a dangerous and risky activity tending to shorten his life expectancy. That Luna had engaged in car racing is not based on any evidence on record. That Luna was engaged in go-kart racing is the correct statement but then go-kart racing cannot be categorized as a dangerous sport for go-karts are extremely low slung, low powered vehicles, only

slightly larger than foot-pedalled four wheeled conveyances. It was error on the part of the Court of Appeals to have disturbed the determination of the trial court which it had previously

affirmed.

Similarly, it was error for the Court of Appeals to reduce the net annual income of the deceased by increasing his annual personal expenses but without at the same time increasing his annual gross income. It stands to reason that if his annual personal expenses should increase because of the "escalating price of gas which is a key expenditure in Roberto R. Luna's social standing" [a statement which lacks complete basis], it would not be unreasonable to suppose that his income would also increase considering the manifold sources thereof.

(2) Yes. The attorney's fees were awarded in the concept of damages in a quasi-delict case and under the circumstances interest as part thereof may be adjudicated at the discretion of the court. (See Art. 2211, Civil Code.) As with the other damages awarded, the interest should accrue only from the date of the trial court's decision.

Vicarious liability of Parents

Exconde vs .Capuno

G.R. No. L-10134 (June 29, 1957)

Facts: Dante Capuno, the 15 year old minor son of Delfin Capuno and Boy Scout Organization member, attended a parade upon the instruction of the City school’s supervisor. Dante,

with other students, boarded a jeep and drove the same when it ran with the driver in his left. Shortly after, Dante sent the jeep tumbling, killing two of its passengers.

Issue: Whether or not the father is liable for the acts of his son in a parade?

Held: Yes. The civil liability imposed upon the father and mother for any damages that may be caused by the minor children is a necessary consequence of the parental authority they

exercise over them, which imposes upon parents the “duty of supporting them, keeping them in their company, educating them and instructing them in proportion to their means,” while,

on the other hand, gives them the “right to correct and punish them in moderation.” The only way to relieve them is if they prove that they exercised all the diligence of a good father of a

family. This defendant failed to do.

Salen vs Balce

G.R.No. L-14414 (April 27 1960)

Facts: Gumersindo Balce, 14 years old, was convicted of homicide and was sentenced to indemnify the heirs of the deceased the amount of P2,000. The amount was not realized by the

heirs after execution because Gumersido had no property in his name so they demanded the father of the minor to indemnify them.

Issue: Whether or not the father is liable for obligations arising from criminal acts?

Held: Yes. While the court agrees with the theory that, as a rule, the civil liability arising from a crime shall be governed by the provisions of the Revised Penal Code, it disagrees with

the contention that the subsidiary liability of persons for acts of those who are under their custody should likewise be governed by the same Code even in the absence of any provision

governing the case, for that would leave the transgression of certain right without any punishment or sanction in the law. Such would be the case if we would uphold the theory of

appellee as sustained by the trial court.

A minor over 15 who acts with discernment is not exempt from criminal liability, for which reason the Code is silent as to the subsidiary liability of his parents should he stand convicted. In that case, resort should be had to the general law which is our Civil Code. The particular law that governs this case is Article 2180, the pertinent portion of which provides:

"The father and, in case of his death or incapacity, the mother, are responsible for damages caused by the minor children who lived in their company."

To hold that this provision does not apply to the instant case because it only covers obligations which arise from quasi-delicts and not obligations which arise from criminal offenses, would result in the absurdity that while for an act where mere negligence intervenes the father or mother may stand subsidiarily liable for the damage caused by his or her son, no liability would attach if the damage is caused with criminal intent.

FUELLAS v CADANO

G.R. No. 14409 (October 31, 1961)

Facts: Rico Fuellas took the pencil of one of his classmates. Pepito returned the pencil which angered Rico who then held Pepito’s neck and pushed him on the floor. Their teacher

separated them and ordered them to go home. Rico met Pepito outside and repeated what he did earlier which broke Pepito’s right arm. Rico was later convicted for intentional felony

with discernment,and his father held subsidiarily liable for damages.

Issue: Whether or not the father is liable should his minor child act with discernment in a criminal offense?

Held: Yes. Since Article 101 of the Revised Penal Code is silent as to the subsidiary liability in case a minor child acts with discernment and become criminally liable so the resort should

be referring to the general law which is the Civil Code.

The particular law that governs this case is Article 2180, the pertinent portion of which provides: "The father and, in case of his death or incapacity, the mother, are responsible

for damages caused by the minor children who live in their company." To hold that this provision does not apply to the instant case because it only covers obligations which arise from

intent.

quasi-delicts and not obligations which arise from criminal offenses, would result in the absurdity that while for an act where mere negligence intervenes the father or mother may stand

subsidiarily liable for the damage caused by his or her son, no liability would attach if the damage is caused with criminal

Gutierrez vs. Gutierrez

G.R. No. 34840 (September 23, 1931)

Facts: Bonifacio Gutierrez, the 18 y/o son of Manuel Gutierrez, was driving the family car with other family members overly speeding while approaching a bridge which caused an

accident with a passenger bus injuring Narcisso Gutierrez (not related to Bonifacio and Manuel). It was later held that Bonifacio is incompetent to drive.

Issue: Is the father liable for the act of his son?

Held: Yes. The theory of the law is that the running of the machine by a child to carry other members of the family is within the scope of the owner's business, so that he is liable for the

negligence of the child because of the relationship of master and servant.

Rodriguez-Luna v IAC

135 SCRA 241 (1985)

Facts: Luis dela Rosa, 13 years of age and without a driver’s license, at that time while driving a Toyota car negligently killed Roberto Luna who was driving a Go-Kart in a practice run. Later, Luis already became of age, married, with two children, and living in Madrid says that he has no properties so a writ of execution cannot be enforced against him.

Issue: May the father still be held liable despite the attainment of majority by his son at the time the decision was promulgated?

Held: Yes. Notwithstanding emancipation, he is still liable but as a matter of equity, the liability shall become merely subsidiary.

Cuadra vs. Monfort

35 SCRA 160 (1970)

Facts:Maria Teresa Cuadra and Maria Teresa Monfort, 13 years old, together with three other classmates were assigned to weed the grass in the school premises. Monfort pulled a prank to scare Cuadra by throwing a plastic headband at her face and making it appear that it was an earthworm. Unfortunately, the headband hit Cuadra’s right eye, blinding the same.

Issue: Is the father liable for his daughter’s acts?

Held: No. In the present case there is nothing from which it may be inferred that the defendant could have prevented the damage by the observance of due care, or that he was in any way remiss in the exercise of his parental authority in failing to foresee such damage, or the act which caused it.

On the contrary, his child was at school, where it was his duty to send her and where she was, as he had the right to expect her to be, under the care and supervision of the teacher. And as far as the act which caused the injury was concerned, it was an innocent prank not unusual among children at play and which no parent, however careful, would have any special reason to anticipate much less guard against. Nor did it reveal any mischievous propensity, or indeed any trait in the child's character which would reflect unfavorably on her upbringing and for which the blame could be attributed to her parents.

Libi v. IAC

214 SCRA 16 (1990)

Facts: Wendell Libi, minor, was dumped by his sweetheart Julie Anne after the latter found him to be sadistic and irresponsible. Wendell kept pestering Julie Ann with demands for

reconciliation but the Julie refused, prompting him to resort to threats against her. In order to avoid him, Julie Ann stayed in the house of her best friend, Malou Alfonso.

Later, Wendell took the key of deposit box, opened it and, and took the gun stored inside. The gun belongs to his father, an agent of the Constabulary Anti-Narcotics Unit (CANU).

Wendell went to his ex-sweetheart, killed her and then committed suicide using the same gun. The parents of Julie Anne sued the parents of Wendell for damages.

The Libis contend that an unknown third party, whom Wendell may have displeased or antagonized by reason of his work as a narcotics informer of the Constabulary Anti-Narcotics Unit (CANU), must have caused Wendell's death and then shot Julie Ann to eliminate any witness and thereby avoid identification.

Issue: Is the father liable for Wendell’s acts?

Held: Yes. The father of Wendell did not exercise due diligence when he did not prevent the kid from having access to the key which opens his safety deposit box. The court did not give

credence to the story of the Libis.

Amelita Libi, mother of Wendell, testified that her husband, Cresencio Libi, owns a gun which he kept in a safety deposit box inside a drawer in their bedroom. Each of the

Wendell’s parents holds a key to the safety deposit box and Amelita's key is always in her bag, all of which facts were known to Wendell. They have never seen their son Wendell taking or using the gun. She admitted, however, that on that fateful night the gun was no longer in the safety deposit box. In view of these circumstances, it can be deduced that the spouses Libi have not exercised the diligence of a good father of a family by safely locking the fatal gun away. Wendell could not have gotten hold thereof unless one of the keys to the safety deposit box was negligently left lying around or he had free access to the bag of his mother where the other key was.

Tamargo vs CA

G.R. No. 85044, June 3, 1992.

Facts: A case based on quasi-delict was filed against the natural parents of Adelberto Bundoc, a minor, who shot Jennifer Tamargo with an air rifle which caused her death. Prior to the

incident, Adelberto has been the subject of adoption proceedings filed by Rapisura spouses and after the incident, the same was granted. In the Bundocs’ answer, they said that the

Rapisuras are the ones who should be liable since parental authority had shifted to the adopting parents from the moment a successful petition was filed.

Issue: Who should be liable for the minor’s acts?

Held: Parental authority is not retroactively transferred to the adopting

custody pending the adoption proceedings are still the natural parents over the child, they should be

the ones liable for any damage caused.

Vicarious liability of teachers and heads of institutions

Mercado vs. CA

G.R. No. L-14342, May 30, 1960

Facts: Manuel Quisimbing, Jr., son of private respondents Ana and Manuel, Sr., was the classmate of Augusto Mercado in the Lourdes School of Kanlaon, Q.C. A melee ensued between the two on account of the latter’s (Augusto Mercado) “pitogo”, an empty nutshell used by children as a coin bank. The said coin bank was lent several times. As Mercado attempted to obtain the same, Manuel Jr. told him not to do so because Renato was better at putting the chain into the holes of the "pitogo". The fight started thereafter. Augusto gave successive blows to Manuel, Jr., and as he clutched his stomach, which bore the brunt of Augusto's anger, Augusto cut him on the right cheek with a razor. Private respondents went to court asking for moral damages on account of a) the wound inflicted by Augusto Mercado (2,000) , and b) moral damages due to the mental anguish of seeing their son wounded (3,000). Although originally dismissed by the CFI of Manila, on appeal, judgment was rendered in favor of respondents, ordering petitioner to pay P2,000 as moral damages and P50 as medical expenses.

Petitioner argues that since the infliction of the wound occurred in a Catholic School (during recess time), through no fault of the father, petitioner herein, the teacher or head of the school should be held responsible instead of the latter. Further, they claim that the award of moral damages was excessive.

Issue: To whom does responsibility over the child’s actions pass to, the teacher or the parent? Was the award of moral damages excessive?

Held: As to the first issue, the Supreme Court held in Exconde vs. Capuno and Capuno that responsibility over the child’s actions must pass to the teacher. However, this provision only applies to an institution of arts and trades not to an academic educational institution. Further, upon reading the last paragraph of Article 2180 of the Civil Code, it would be seem that the clause "so long as they remain in their custody," contemplates a situation where the pupil lives and boards with the teacher, such that control, direction and influence on the pupil supersedes those of the parents. Such a situation does not appear in the case at bar; the pupils appear to go to school during school hours and go back to their homes with their parents after school is over. Similarly, paragraph 2 of said article, which makes father or mother responsible for the damages caused by their minor children, cannot apply. The claim of petitioner that responsibility should pass to the school must, therefore, be held to be without merit.

As to the amount of moral damages, the Court held that while moral damages included physical suffering, the decision of the court below does not declare that any of the cases specified in Article 2219 of the Civil Code in which moral damages may be recovered, has attended or occasioned the physical injury. The only possible circumstance in the case at bar in which moral damages are recoverable would be if a criminal offense or a quasi-delict has been committed. It does not appear that a criminal action for physical injuries was ever presented. Further, the offender was nine years old and did not appear to have acted with discernment when he inflicted the physical injuries on Manuel Quisumbing, Jr.

Further, even if we assume that the CA considered Mercado guilty of a quasi-delict when it imposed moral damages, the facts found by said court indicate that Augusto's resentment, was occasioned by the fact that Manuel, Jr. had tried to intervene in or interfere with the attempt of Mercado to get "his pitogo from Renato." It is, therefore, apparent that the proximate cause of the injury caused to Quisumbing was Quisumbing's own fault or negligence for having interfered with Mercado while trying to get the pitogo from another boy.

Palisoc vs. CA

G.R. No. L-29025 (October 4, 1971)

Facts: Dominador Palisoc and the defendant Virgilio L. Daffon were classmates and, together with another classmate Desiderio Cruz were in the laboratory room located on the ground

floor. At that time the classes were in recess, Cruz and Daffon were working on a machine while Dominador Palisoc was merely looking on at them. Daffon made a remark to the effect

that Palisoc was acting like a foreman. Because of this remark Palisoc slapped slightly Daffon on the face. Daffon, in retaliation, gave Palisoc a strong flat blow on the face, followed by

other fist blows to the stomach. Palisoc retreated, but Daffon followed him and both exchanged blows until Palisoc stumbled on an engine block causing him to fall face downward.

Palisoc became pale and fainted. First aid was administered to him but he was not revived, so he was immediately taken to a hospital. He never regained consciousness.

Trial ensued, with the trial court giving credence to Cruz’s version of the incident. The trial court found defendant Daffon liable for the quasi delict under Article 2176 of the Civil Code. It held that "(T)he act of Daffon in giving the deceased strong fist blows in the stomach which ruptured his internal organs and caused his death falls within the purview of this article of the Code."

Issue: Did the trial court err in absolving the defendants-school officials instead of holding them jointly and severally liable with defendant Daffon, for the damages awarded them as a

result of their son's death?

Held: Yes. The Court ruled that the lower court’s decision to absolve was based on Mercado v. CA, which was based in turn on another dictum in the earlier case of Exconde vs.

Capuno, The dictum in such earlier case that "It is true that under the law above-quoted, teachers or directors of arts and trades are liable for any damage caused by their pupils or apprentices while they are under their custody, but this … applies to an institution of arts and trades and not to any academic educational institution." The case at hand was instituted directly against the school officials and squarely raises the issue of liability of teachers and heads of schools under Article 2180, Civil Code, for damages caused by their pupils and students against fellow students on the school premises.

There is no question, either, that the school involved is a non-academic school, the Manila Technical Institute being admittedly a technical vocational and industrial school. With this in mind, the Court holds that under the cited codal article, defendants head and teacher of the Manila Technical Institute ( Valenton and Quibulue, respectively) are liable jointly and severally for damages to plaintiffs-appellants for the death of the latter's minor son at the hands of defendant Daffon at the school's laboratory room.

In the law of torts, the governing principle is that the protective custody of the school heads and teachers is mandatorily substituted for that of the parents. It becomes their

obligation as well as that of the school itself to provide proper supervision of the students' activities during the whole time that they are at attendance in the school, including recess time,

as well as to take the necessary precautions to protect the students in their custody from dangers and hazards that would reasonably be anticipated, including injuries that some student

themselves may inflict willfully or through negligence on their fellow students.

There is nothing in the law that requires that for such liability to attach, the pupil or student who commits the tortious act must live and board in the school, as erroneously held

by the lower court, and the dicta in Mercado (as well as in Exconde) on which it relied, must now be deemed to have been set aside by the present decision.

Amadora vs. CA

G.R. No. L-47745, April 15, 1988

Facts: Alfredo Amadora went to the San Jose-Recoletos on April 13, 1972, and while in its auditorium was shot to death by Pablito Daffon, a classmate. Daffon was convicted of

homicide thru reckless imprudence. Additionally, a civil action for damages was filed against the Colegio de San Jose-Recoletos, its rector the high school principal, the dean of boys, and

the physics teacher, together with Daffon and two other students, through their respective parents.

The Court of Appeals, in reversing the CFI’s decision, found that Article 2180 was not applicable as the Colegio de San Jose-Recoletos was not a school of arts and trades but an academic institution of learning. It also held that the students were not in the custody of the school at the time of the incident as the semester had already ended, that there was no clear identification of the fatal gun and that in any event the defendant, had exercised the necessary diligence in preventing the injury.

The petitioners contend that their son was in the school to show his physics experiment as a prerequisite to his graduation; hence, he was then under the custody of the private respondents.

Earlier, Sergio Damaso, Jr., the dean of boys, confiscated from Jose Gumban an unlicensed pistol but later returned it to him without making a report to the principal or taking

any further action. As Gumban was one of the companions of Daffon when the latter fired the gun that killed Alfredo, petitioners contend that this was the same pistol that had been

confiscated from Gumban and that their son would not have been killed if it had not been returned by Damaso.

Issues: Does Article 2180 apply only to cases of tort which occur in schools of arts and trades? When is a student said to be in the “custody” of the school?

Held: The Court held that Article 2180 should apply to all schools regardless of its academic or non-academic status, since there is no substantial difference between the two insofar as

supervision, advice and insofar as torts committed by their students are concerned. This is in line with the dissenting opinion penned by Justice JBL Reyes in Exconde v. Capuno. The

Court cannot see why different degrees of vigilance should be exercised by the school authorities on the basis only of the nature of their respective schools. No plausible reason exists for

relaxing that vigilance simply because the school is academic in nature and for increasing such vigilance where the school is non-academic. The teacher certainly should not be able to

excuse himself by simply showing that he is teaching in an academic school where, on the other hand, the head would be held liable if the school were non-academic.

Further, following reddendo singgula singulis, in reading the provision, “teachers" should apply to the words "pupils and students" and "heads of establishments of arts and trades" to the word "apprentices." The latter can be traced from history, back when schools of arts and trades were engaged in the training of artisans apprenticed to their master who personally and directly instructed them on the technique and secrets of their craft. The head of the school of arts and trades was such, a master, and was personally involved in the task of teaching his students, who usually even boarded with him and came under his constant control, supervision and influence.

As regards the second issue, the Court held that while the custody requirement does not mean that the student must be boarding with the school authorities, it does signify that the student should be within the control and under the influence of the school authorities at the time of the occurrence of the injury. The student is deemed to be in the custody of the school authorities as long as he is under the control and influence of the school and within its premises, whether the semester has not yet begun or has already ended. As long as it can be shown that the student is in the school premises in pursuance of a legitimate student objective, in the exercise of a legitimate student right, and even in the enjoyment of a legitimate student right, and even in the enjoyment of a legitimate student privilege, the responsibility of the school authorities over the student continues.

Pasco vs. CFI

G.R. No. L-54357 (April 25, 1988)

Facts: On August 24, 1979 at about 5:00 o'clock in the afternoon, petitioner Pasco, together with two companions, while walking inside the campus of the private respondent Araneta University, after attending classes in said university, was accosted and mauled by a group of Muslim students led by Abdul Karim Madidis alias "Teng." Said Muslim group were also students of the Araneta University. Petitioner was subsequently stabbed by Abdul and as a consequence he was hospitalized at the Manila Central University (MCU) Hospital where he underwent surgery to save his life.

Petitioner, assisted by his father Pedro Pasco, filed a complaint for damages against Abdul Karim Madidis and herein private respondent Gregorio Araneta University which was docketed as Civil Case No. SM-1027. Said school was impleaded as a party defendant based on Article 2180 of the Civil Code. Subsequently, a motion to dismiss was filed by respondent school.

Respondent court granted the motion to dismiss, and likewise denied petitioner's motion for reconsideration.

Issue: Is the provision in the last paragraph of Article 2180 of the Civil Code equally applicable to academic institutions?

Held: The court rules in the negative, for surely the provision concerned speaks only of "teachers or heads." Further, the court finds no necessity of discussing the applicability of the Article to educational institutions (which are not schools of arts and trades) for the issue in this petition.

NOTE: Compare this with the immediately preceding case.

YLarde vs. Aquino

G.R. No. L-33722 (July 29, 1988)

Facts: Supra

Issue: Whether or not under Art. 2176 and 2180, both the teacher and the principal can be held liable for damages

Held: As to the principal, he cannot be made responsible for the death of the child Ylarde, he being the head of an academic school and not a school of arts and trades. In line with the ruling in Amadora vs. Court of Appeals, under Article 2180 of the Civil Code, it is only the teacher and not the head of an academic school who should be answerable for torts committed by their students. This Court went on to say that in a school of arts and trades, it is only the head of the school who can be held liable. Soriano, as principal, cannot be held liable for the reason that the school he heads is an academic school and not a school of arts and trades. Besides, as clearly admitted by private respondent Aquino, private respondent Soriano did not give any instruction regarding the digging.

From the foregoing, it can be easily seen that private respondent Aquino can be held liable under Article 2180 of the Civil Code as the teacher-in-charge of the children for being negligent in his supervision over them and his failure to take the necessary precautions to prevent any injury on their persons. However, petitioners base the alleged liability of private respondent Aquino on Article 2176. Were there acts and omissions on the part of private respondent Aquino amounting to fault or negligence which have direct causal relation to the death of his pupil Ylarde? The Court answered in the affirmative. He is liable for damages.

Clearly, private respondent Aquino acted with fault and gross negligence when he: (1) failed to avail himself of services of adult manual laborers and instead utilized his pupils aged ten to eleven to make an excavation near the one-ton concrete stone which he knew to be a very hazardous task; (2) required the children to remain inside the pit even after they had finished digging, knowing that the huge block was lying nearby and could be easily pushed or kicked aside by any pupil who by chance may go to the perilous area; (3) ordered them to level the soil around the excavation when it was so apparent that the huge stone was at the brink of falling; (4) went to a place where he would not be able to check on the children's safety; and (5) left the children close to the excavation, an obviously attractive nuisance.

The contention that private respondent Aquino exercised the utmost diligence of a very cautious person is certainly without cogent basis. A reasonably prudent person would have foreseen that bringing children to an excavation site, and more so, leaving them there all by themselves, may result in an accident. An ordinarily careful human being would not assume that a simple warning "not to touch the stone" is sufficient to cast away all the serious danger that a huge concrete block adjacent to an excavation would present to the children. Moreover, a teacher who stands in loco parentis to his pupils would have made sure that the children are protected from all harm in his company

Salvosa vs. IAC

G.R. No. 70458 October 5, 1988

Facts: Within the premises of Baguio Colleges Foundation (BFC), an academic institution, is an ROTC Unit, the Baguio Colleges Foundation Reserve Officers Training Corps (ROTC)

Unit, which is under the fifth control of the Armed Forces of the Philippines. Jimmy B. Abon is its duly appointed armorer, who received his appointment from the AFP, and is not an

employee of the BCF.

On 3 March 1977, at around 8:00 p.m., in the parking space of BCF, Jimmy B. Abon shot Napoleon Castro a student of the University of Baguio with an unlicensed firearm

which the former took from the armory of the ROTC Unit of the BCF. Napoleon Castro died and Jimmy B. Abon was prosecuted for, and convicted of the crime of Homicide by Military

Commission No. 30, AFP.

defendants. The trial court rendered decision sentencing Abon, Salvosa and BCF jointly and severally liable to the heirs of Castro.

ISSUE: Can Salvosa and the BCF be held solidarily liable with Abon for damages under Article 2180 of the Civil Code, as a consequence of the tortious act of Jimmy B. Abon?

HELD: No. Under the penultimate paragraph of Art. 2180 of the Civil Code, teachers or heads of establishments of arts and trades are hable for "damages caused by their pupils and

students or apprentices, so long as they remain in their custody." The rationale of such liability is that so long as the student remains in the custody of a teacher, the latter "stands, to a

certain extent, in loco parentis [as to the student] and [is] called upon to exercise reasonable supervision over the conduct of the [student]." Likewise, "the phrase used in [Art. 2180 — 'so long as (the students) remain in their custody means the protective and supervisory custody that the school and its heads and teachers exercise over the pupils and students for as long as they are at attendance in the school, including recess time."

In line with the case of Palisoc, a student not "at attendance in the school" cannot be in "recess" thereat. A "recess," as the concept is embraced in the phrase "at attendance in the

school," contemplates a situation of temporary adjournment of school activities where the student still remains within call of his mentor and is not permitted to leave the school premises,

or the area within which the school activity is conducted. Recess by its nature does not include dismissal. Likewise, the mere fact of being enrolled or being in the premises of a school without more does not constitute "attending school" or being in the "protective and supervisory custody' of the school, as contemplated in the law.

Jimmy B. Abon cannot be considered to have been "at attendance in the school," or in the custody of BCF, when he shot Napoleon Castro. Logically, therefore, petitioners

cannot under Art. 2180 of the Civil Code be held solidarily liable with Jimmy B. Abon for damages resulting from his acts.

St. Francis High School vs. CA

G.R. No. 82465 (February 25, 1991)

Facts: Ferdinand Castillo, a freshman student of Section 1-C at the St. Francis High School, wanted to join a school picnic undertaken by Class I-B and Class I-C at Talaan Beach, Sariaya, Quezon. Ferdinand's parents, spouses Dr. Romulo Castillo and Lilia Cadiz Castillo, because of short notice, did not allow their son to join but merely allowed him to bring food to the teachers for the picnic, with the directive that he should go back home after doing so. Ferdinand went on with them to the beach. During the picnic, one of the female teachers was apparently drowning. Some of the students, including Ferdinand, came to her rescue, but in the process, Ferdinand drowned.

The spouses Castillo filed a complaint against St. Francis High School, represented by the spouses Fernando Nantes and Rosario Lacandula, Benjamin Illumin (its principal), and the teachers: Tirso de Chaves, Luisito Vinas, Connie Arquio, Nida Aragones, Yoly Jaro, and Patria Cadiz, for Damages. The trial court decided against teachers Arquio, de Chaves, Vinas, Aragones, Jaro and Cadiz, for failing to exercise the diligence required of them by law under the circumstances to guard against the harm they had foreseen. It dismissed the case against the St. Francis High School, Benjamin Illumin and Aurora Cadorna for failing to show that they were responsible for Castillo's death.

On appeal, the CA ruled that St. Francis HS and Illumin were liable under Art 2176 taken together with the 1st, 4th and 5th paragraphs of Article 2180 of the Civil Code. Yoly Jaro and Nida Aragones, who had satisfactorily explained why they were late in going to the picnic site were absolved of liability.

ISSUES: (1) Were the school and their teachers negligent? (2)Is Art. 2180, in relation to Art. 2176 of the New Civil Code is applicable? (3) Is the award of exemplary and moral damages is proper?

HELD: The school and the principle are neither guilty of their own negligence or guilty of the negligence of those under them. They cannot be held liable for damages of any kind.

Under Article 2180, par. 4, before an employer may be held liable for the negligence of his employee, the act or omission which caused damage or prejudice must have occurred while an employee was in the performance of his assigned tasks. Mere knowledge by Illumin of the planning of the picnic by the students and their teachers does not in any way or in any manner show acquiescence or consent to the holding of the same. The application therefore of Article 2180 has no basis in law and neither is it supported by any jurisprudence.

No negligence could be attributable to the petitioners-teachers to warrant the award of damages to the respondents-spouses. Arquio, class adviser of I-C, did her best and exercised diligence of a good father of a family to prevent any untoward incident or damages to all the students who joined the picnic.

With these facts in mind, no moral nor exemplary damages may be awarded in favor of respondents-spouses. The case at bar does not fall under any of the grounds to grant moral damages.

Moreover, as already pointed out hereinabove, petitioners are not guilty of any fault or negligence, hence, no moral damages can be assessed against them. While it is true that respondents-spouses did give their consent to their son to join the picnic, this does not mean that the petitioners were already relieved of their duty to observe the required diligence of a good father of a family in ensuring the safety of the children. But in the case at bar, petitioners were able to prove that they had exercised the required diligence. Hence, the claim for moral or exemplary damages becomes baseless.

PSBA vs. CA

G.R. No. 84698 (February 4, 1992)

Facts: A stabbing incident on 30 August 1985 caused the death of Carlitos Bautista while on the second-floor premises of the Philippine School of Business Administration (PSBA). His

parents filed a suit in the RTC of Manila (Branch 47) presided over by Judge (now Court of Appeals justice) Regina Ordoñez-Benitez, for damages against the said PSBA and its

corporate officers. At the time of his death, Carlitos was enrolled in the third year commerce course at the PSBA. It was established that his assailants were not members of the school's academic community but were elements from outside the school.

PSBA sought to have the suit dismissed, alleging that since they are being sued under Art 2180 of the Civil, the complaint lacks a cause of action because they, as an academic

institution, were beyond the ambit of the rule . The courts denied the motion.

ISSUE: Is the PSBA liable under Articles 2176 and 2180 of the Civil Code?

HELD: Article 2180, in conjunction with Article 2176 of the Civil Code, establishes the rule of in loco parentis. Article 2180 plainly provides that the damage should have been caused

or inflicted by pupils or students of the educational institution sought to be held liable for the acts of its pupils or students while in its custody. This material situation does not exist in the

present case for, as earlier indicated, the assailants of Carlitos were not students of the PSBA, for whose acts the school could be made liable. However, it does not necessarily follow that

PSBA is exculpated from liability.

When an academic institution accepts students for enrollment, there is established a contract between them, resulting in bilateral obligations which both parties are bound to comply with. The school undertakes to provide the student with an education that would presumably suffice to equip him with the necessary tools and skills to pursue higher education or a profession. On the other hand, the student covenants to abide by the school's academic requirements and observe its rules and regulations.

Because the circumstances of the present case evince a contractual relation between the PSBA and Carlitos Bautista, the rules on quasi-delict do not really govern. A perusal of Article 2176 shows that obligations arising from quasi-delicts or tort, also known as extra-contractual obligations, arise only between parties not otherwise bound by contract, whether express or implied. However, this impression has not prevented the Court from determining the existence of a tort even when there obtains a contract. Jurisprudence indicates that should the act which breaches a contract be done in bad faith and be violative of Article 21, then there is a cause to view the act as constituting a quasi-delict.

In the circumstances obtaining in the case at bar, there is no finding that the contract between the school and Bautista had been breached thru the former's negligence in

providing proper security measures. This would be for the trial court to determine. And, even if there be a finding of negligence, the same could give rise generally to a breach of contractual obligation only. Using the test of Cangco, the negligence of the school would not be relevant absent a contract. In fact, that negligence becomes material only because of the contractual relation between PSBA and Bautista. In other words, a contractual relation is a condition sine qua non to the school's liability. The negligence of the school cannot exist

independently of the contract, unless the negligence occurs under the circumstances set out in Article 21 of the Civil Code.

As the proceedings have yet to commence, only the trial court can make a determination of material facts.

Soliman vs. Tuason

G.R. No. 66207 (May 18, 1992)

Facts: On 13 August 1982, Soliman, Jr., a regular student of Republic Central Colleges (RCC), was in its campus ground and premises taking his morning classes. Jimmy B. Solomon, who was on said date and hour in the premises of said school performing his duties and obligations as a duly appointed security guard under the employment, supervision and control of

R.L. SECURITY AGENCY, INC., headed by Mr. Benjamin Serrano, shot Soliman on the abdomen with a .38 Caliber Revolver, a deadly weapon, which ordinarily such wound sustained would have caused plaintiff's death were it not for the timely medical assistance given to him.

Soliman filed a civil complaint for damages against private Republic Central Colleges, the R.L. Security Agency Inc. and Jimmy B. Solomon, a security guard. RCC filed a motion to dismiss, arguing that there was no cause of action against it, and that it is free from liability because RCC was not the employer of the security guard charged, Jimmy Solomon, and hence was not responsible for any wrongful act of Solomon. They also argued that Article 2180, 7th paragraph, of the Civil Code did not apply, since said paragraph holds teachers and heads of establishment of arts and trades liable for damages caused by their pupils and students or apprentices, while security guard Jimmy Solomon was not a pupil, student or apprentice of the school. The court granted the motion to dismiss.

ISSUE: Is RCC liable for damages?

Held: Yes, but RCC is not liable under Article 2180 par. 5 of the Civil Code. RCC was not the employer of Jimmy Solomon. The employer of Jimmy Solomon was the R.L. Security Agency Inc., while the school was the client or customer of the R.L. Security Agency Inc. It is settled that where the security agency, as here, recruits, hires and assigns the work of its watchmen or security guards, the agency is the employer of such guards or watchmen. Liability for illegal or harmful acts committed by the security guards attaches to the employer agency, and not to the clients or customers of such agency.

Likewise, RCC is not liable under Article 2180 par 7. since there is no question that Jimmy Solomon was not a pupil or student or an apprentice of the Colleges, he being in fact an employee of the R.L. Security Agency Inc.,

However, it does not follow that RCC could not be held liable upon any other basis in law. In PSBA, the Court held that Article 2180 of the Civil Code was not applicable where a student had been injured by one who was an outsider or by one over whom the school did not exercise any custody or control or supervision. At the same time, however, the Court stressed that an implied contract may be held to be established between a school which accepts students for enrollment, on the one hand, and the students who are enrolled, on the other hand, which contract results in obligations for both parties.

As PSBA states, acts which are tortious or allegedly tortious in character may at the same time constitute breach of a contractual, or other legal, obligation. Respondent trial judge was in serious error when he supposed that petitioner could have no cause of action other than one based on Article 2180 of the Civil Code. Respondent trial judge should not have granted the motion to dismiss but rather should have, in the interest of justice, allowed petitioner to prove acts constituting breach of an obligation ex contractu or ex lege on the part of respondent Colleges.

St. Mary’s Academy vs. Carpitanos

G.R. No. 143363 (February 6, 2002)

Facts: From 13 to 20 February 1995, St. Mary’s Academy of Dipolog City conducted an enrollment drive for the school year 1995-1996. A facet of the enrollment campaign was the visitation of schools from where prospective enrollees were studying. Sherwin Carpitanos was part of the campaigning group. Sherwin, along with other high school students rode a Mitsubishi jeep owned by Vivencio Villanueva on their way to Larayan Elementary School, Larayan, Dapitan City. The jeep was driven by James Daniel II then 15 years old and a student of the same school. The jeep turned turtle. Sherwin died.

Spouses William Carpitanos and Lucia Carpitanos filed a case against James Daniel II and his parents, James Daniel Sr. and Guada Daniel, the vehicle owner, Vivencio Villanueva and St. Mary’s Academy before the Regional Trial Court of Dipolog City. The RTC rendered judgment holding St. Mary's Academy liable for damages, and the Daniels' subsidiarily liable. James Daniel II and Villanueva were absolved of liability.

ISSUE: Is St. Mary's Academy liable for damages?

Held: No. Under Article 218 of the Family Code, the following shall have special parental authority over a minor child while under their supervision, instruction or custody: (1) the school, its administrators and teachers; or (2) the individual, entity or institution engaged in child care. This special parental authority and responsibility applies to all authorized activities, whether inside or outside the premises of the school, entity or institution. Thus, such authority and responsibility applies to field trips, excursions and other affairs of the pupils and students outside the school premises whenever authorized by the school or its teachers.

Under Article 219 of the Family Code, if the person under custody is a minor, those exercising special parental authority are principally and solidarily liable for damages caused by the acts or omissions of the unemancipated minor while under their supervision, instruction, or custody. However, for petitioner to be liable, there must be a finding that the act or omission considered as negligent was the proximate cause of the injury caused because the negligence must have a causal connection to the accident. In this case, the respondents failed to show that the negligence of petitioner was the proximate cause of the death of the victim.

“The proximate cause of an injury is that cause, which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces the injury, and without which the result would not have occurred.”

Considering it was the negligence of the minor driver or the detachment of the steering wheel guide of the jeep owned by Villanueva which caused the accident, an event over which St. Mary’s Academy had no control, and which was the proximate cause of the accident, the school may not be held liable for the death resulting from such accident.

Consequently, the school cannot be liable for moral damages. Though incapable of pecuniary computation, moral damages may be recovered if they are the proximate result of

the defendant’s wrongful act or omission. In this case, the proximate cause of the accident was not attributable to petitioner.

Incidentally, there was no question that the registered owner of the vehicle was respondent Villanueva. He never denied and in fact admitted this fact. We have held that the registered owner of any vehicle, even if not used for public service, would primarily be responsible to the public or to third persons for injuries caused the latter while the vehicle was being driven on the highways or streets.”

Vicarious liability of owners and managers of establishments

Philippine Rabbit vs. Philippine American

G.R. No. L-25142 (March 25, 1975)

Facts: In the complaint for damages filed by the Philippine Rabbit Bus Lines and Pangalangan against Phil-American Forwarders, Inc., Balingit and Pineda, it was alleged that on

November 24, 1962, Pineda drove recklessly a freight truck, owned by Phil-American Forwarders, Inc., along the national highway at Sto. Tomas, Pampanga. The truck bumped the bus driven by Pangalangan, which was owned by Philippine Rabbit Bus Lines, Inc. As a result of the bumping, Pangalangan suffered injuries and the bus was damaged and could not be used for seventy-nine days, thus depriving the company of earnings amounting to P8,665.51. Balingit was the manager of Phil-American Forwarders, Inc.

The case was dismissed based on the ground that Balingit as the manager of Phil-American Forwarders, Inc., which together with Fernando Pineda and Balingit, was sued for

damages in an action based on quasi-delict or culpa aquiliana, is not the manager of an establishment contemplated in article 2180 of the Civil Code.

Issue: Do the terms "employers" and "owners and managers of an establishment or enterprise" (dueños o directores de un establicimiento o empresa) used in article 2180 of the Civil

Code, formerly article 1903 of the old Code, embrace the manager of a corporation owning a truck, the reckless operation of which allegedly resulted in the vehicular accident from

which the damage arose?

Held: No. Those terms do not include the manager of a corporation. It may be gathered from the context of article 2180 that the term "manager" ("director" in the Spanish version) is

used in the sense of "employer".

Hence, under the allegations of the complaint, no tortious or quasi-delictual liability can be fastened on Balingit as manager of Phil-American Forwarders, Inc., in connection

with the vehicular accident already mentioned because he himself may be regarded as an employee or dependiente of his employer, Phil-American Forwarders, Inc.

The bus company and its driver, in their appellants' brief, injected a new factual issue which was not alleged in their complaint. They argue that Phil- American Forwarders, Inc. is merely a business conduit of Balingit. That argument implies that the veil of corporate fiction should be pierced and that Phil-American Forwarders, Inc. and Balingit and his wife should be treated as one and the same civil personality. This issue was not raised in the lower court. The legal issue, which Philippine Rabbit and Pangalangan can ventilate in this appeal, is one which was raised in the lower court and which is within the issues framed by the parties (Sec. 18, Rule 46, Rules of Court).

Vicarious Liability of employers

Philtranco vs. CA

G.R. No. 120553 (June 17, 1997)

Facts: The heirs of Ramon A. Acuesta instituted n action against Philtranco. They alleged that on March 24, 1990, about 6:00 o'clock, the victim Ramon A. Acuesta was riding in his

easy rider bicycle along the Gomez Street of Calbayog City. Philtranco Bus No. 4025 with plate No. EVA-725 driven by defendant Rogasiones Manilhig y Dolira, was being pushed by

some persons to start its engine. The engine started and continued running. It bumped Acuesta and ran over him.

Philtranco, on the other hand, alleged that Manilhig, warmed up the engine of the bus and made a few rounds within the city proper of Calbayog. While the bus was cruising

along Gomez Street, the victim, who was biking towards the same direction as the bus, suddenly overtook two tricycles and swerved left to the center of the road. The swerving was

abrupt and so sudden that even as Manilhig applied the brakes and blew the bus horn, the victim was bumped from behind and run over by the bus. The trial court rendered judgment holding Philtranco and Manilhig jointly and severally liable. The CA affirmed the trial court’s decision.

Issues: (1) Is Article 2194, instead of Article 2180 of the Civil Code applicable, in other words, were Philtranco and Manilhig solidarily liable? (2) Is the award of damages proper?

Held: Yes. The case is action for damages based on quasi-delict under Article 2176 and 2180 of the Civil Code against petitioner Manilhig and his employer, petitioner Philtranco,

respectively.

Under Article 2194 of the Civil Code, the liability of the registered owner of a public service vehicle, like petitioner Philtranco, for damages arising from the tortious acts of the driver is

primary, direct, and joint and several or solidary with the drive. Art. 2194. The responsibility of two or more persons who are liable for a quasi-delict is solidary.

Since the employer's liability is primary, direct and solidary, its only recourse if the judgment for damages is satisfied by it is to recover what it has paid from its employee who committed the fault or negligence which gave rise to the action based on quasi-delict.

Art. 2181. Whoever pays for the damage caused by his dependents or employees may recover from the latter what he has paid or delivered in satisfaction of the claim. The award of "P200,000.00 as death indemnity" not as compensation for loss of earning capacity. There is no evidence on the victim's earning capacity and life expectancy. Only indemnity for death under Article 2206 is due, which is fixed at P50,000.

Castilex vs. Vasquez

G.R. No. 132266 (December 21, 1999)

going around the Osmeña rotunda he made a short cut against [the] flow of the traffic in proceeding to his route to General Maxilom St. or to Belvic St. The pick-up collided with the

motorcycle. Abad brought Vasquez to the Southern Islands Hospital and later to the Cebu Doctor's Hospital, where Vasquez subsequently died.

An action for damages was instituted. The trial court ruled in favor of private respondents Vicente and Luisa Vasquez and held Jose Benjamin Abad and Castilex Industrial Corporation

jointly and solidarily liable for damages. The Court of Appeals affirmed the ruling of the trial court holding ABAD and CASTILEX liable but held that the liability of the latter is "only

vicarious and not solidary" with the former.

Issue: May the employer be held vicariously liable for the death resulting from the negligent operation by a managerial employee of a company-issued vehicle?

Held: Castilex contends that the par. 5 of Article 2180 of the Civil Code should only apply to instances where the employer is not engaged in business or industry. Since it is engaged in the business of manufacturing and selling furniture it is therefore not covered by said provision. Instead, par. 4 should apply. This is not accurate.

This court has applied par. 5 to cases where the employer was engaged in a business or industry such as truck operators and banks. The Court of Appeals cannot, therefore, be faulted in applying the said paragraph of Article 2180 of the Civil Code to this case.

Under par. 5 of Article 2180, whether or not engaged in any business or industry, an employer is liable for the torts committed by employees within the scope of his assigned

tasks. But it is necessary to establish the employer-employee relationship; once this is done, the plaintiff must show, to hold the employer liable, that the employee was acting within the

scope of his assigned task when the tort complained of was committed. It is only then that the employer may find it necessary to interpose the defense of due diligence in the selection and

supervision of the employee.

It is undisputed that ABAD was a Production Manager of petitioner CASTILEX at the time of the tort occurrence. As to whether he was acting within the scope of his assigned

task is a question of fact, which the court a quo and the Court of Appeals resolved in the affirmative.

The mere fact that ABAD was using a service vehicle at the time of the injurious incident is not of itself sufficient to charge petitioner with liability for the negligent operation of

said vehicle unless it appears that he was operating the vehicle within the course or scope of his employment.

In the case at bar, it is undisputed that ABAD did some overtime work at the petitioner's office, which was located in Cabangcalan, Mandaue City. Thereafter, he went to Goldie's Restaurant in Fuente Osmeña, Cebu City, which is about seven kilometers away from petitioner's place of business. It was when ABAD was leaving the restaurant that the incident in question occurred.

ABAD was engaged in affairs of his own or was carrying out a personal purpose not in line with his duties at the time he figured in a vehicular accident.

Since there is lack of evidence that ABAD was acting within the scope of the functions entrusted to him, petitioner CASTILEX had no duty to show that it exercised the diligence of a good father of a family in providing ABAD with a service vehicle. Thus, justice and equity require that petitioner be relieved of vicarious liability for the consequences of the negligence of ABAD in driving its vehicle.

Filamer vs. IAC

G.R. No. 75112 (August 17, 1992)

Facts: The private respondents, heirs of the late Potenciano Kapunan, seek reconsideration of the decision rendered by this Court on October 16, 1990, which ruled that Filamer is not

liable for the injuries caused by Funtecha on the grounds that the latter was not an authorized driver for whose acts the petitioner shall be directly and primarily answerable, and that

Funtecha was merely a working scholar who, under Section 14, Rule X, Book III of the Rules and Regulations Implementing the Labor Code is not considered an employee of the

petitioner.

Funtecha was a working student, being a part-time janitor and a scholar of petitioner Filamer. He was, in relation to the school, an employee even if he was assigned to clean the

school premises for only two (2) hours in the morning of each school day.

Having a student driver's license, Funtecha requested the driver, Allan Masa, and was allowed, to take over the vehicle while the latter was on his way home one late afternoon.

Allan Masa turned over the vehicle to Funtecha only after driving down a road, negotiating a sharp dangerous curb, and viewing that the road was clear. A fast moving truck with glaring

lights nearly hit them so that they had to swerve to the right to avoid a collision. The Pinoy jeep hit Potenciano Kapunan.

Issue: Is Filamer, Funtecha’s employer, liable?

Held: Yes. In learning how to drive while taking the vehicle home in the direction of Allan's house, Funtecha definitely was not having a joy ride. Funtecha was not driving for the

purpose of his enjoyment or for a "frolic of his own" but ultimately, for the service for which the jeep was intended by the petitioner school. Therefore, the Court is constrained to

conclude that the act of Funtecha in taking over the steering wheel was one done for and in behalf of his employer for which act the petitioner-school cannot deny any responsibility by

arguing that it was done beyond the scope of his janitorial duties. The clause "within the scope of their assigned tasks" for purposes of raising the presumption of liability of an employer, includes any act done by an employee, in furtherance of the interests of the employer or for the account of the employer at the time of the infliction of the injury or damage.

Section 14, Rule X, Book III of the Rules implementing the Labor Code, on which the petitioner anchors its defense, was promulgated only for the purpose of administering and enforcing the provisions of the Labor Code on conditions of employment. It is merely a guide to the enforcement of the substantive law on labor.

The reliance on said rule is misplaced. An implementing rule on labor cannot be used by an employer as a shield to avoid liability under the substantive provisions of the Civil Code. There is evidence to show that there exists in the present case an extra-contractual obligation arising from the negligence or reckless imprudence of a person "whose acts or omissions are imputable, by a legal fiction, to other(s) who are in a position to exercise an absolute or limited control over (him)."

Funtecha is an employee of petitioner Filamer. The fact that Funtecha was not the school driver or was not acting within the scope of his janitorial duties does not relieve the petitioner of the burden of rebutting the presumption juris tantum that there was negligence on its part either in the selection of a servant or employee, or in the supervision over him. The petitioner has failed to show proof of its having exercised the required diligence of a good father of a family over its employees Funtecha and Allan.

FIlamer thus has an obligation to pay damages for injury arising from the unskilled manner by which Funtecha drove the vehicle. In the absence of evidence that the petitioner had exercised the diligence of a good father of a family in the supervision of its employees, the law imposes upon it the vicarious liability for acts or omissions of its employees. The liability of the employer is, under Article 2180, primary and solidary. However, the employer shall have recourse against the negligent employee for whatever damages are paid to the heirs of the plaintiff.

NPC vs. CA

G.R. No. 119121 (August 14, 1998)

Facts: On July 22, 1979, a convoy of four (4) dump trucks owned by the National Power Corporation (NPC) left Marawi city bound for Iligan city. Unfortunately, enroute to its

destination, one of the trucks with plate no RFT-9-6-673 driven by a certain Gavino Ilumba figured in a head-on-collision with a Toyota Tamaraw. The incident resulted in the death of

three (3) persons riding in the Toyota Tamaraw, as well as physical injuries to seventeen other passengers.

The heirs of the victims filed a complaint for damages against NPC and PHESCO before the then CFI of Lanao del Norte, Marawi City. The trial court rendered a decision

absolving NPC of any liability and holding PHESCO, Inc. and Gavino Ilumba jointly and severally liable. On Appeal, the CA reversed the trial court’s decision and held that as Phesco is

a “labor only” contractor, of Napocor the statute itself establishes an employer-employee relationship between the employer (Napocor) and the employee (driver Ilumba) of the labor only

contractor (Phesco). NPC is therefore liable and not Phesco.

Issue: As between NPC and PHESCO, who is the employer of Ilumba, driver of the dumptruck which figured in the accident and which should, therefore, would be liable for damages to

the victims?

Held: Under the Memorandum, NPC had mandate to approve the "critical path network and rate of expenditure to be undertaken by PHESCO. Likewise, the manning schedule and pay scale of the workers hired by PHESCO were subject to confirmation by NPC. Then too, it cannot be ignored that if PHESCO enters into any sub-contract or lease, again NPC's concurrence is needed. Another consideration is that even in the procurement of tools and equipment that will be used by PHESCO, NPC's favorable recommendation is still necessary before these tools and equipment can be purchased. Notably, it is NPC that will provide the money or funding that will be used by PHESCO to undertake the project. Furthermore, it must be emphasized that the project being undertaken by PHESCO, i.e., construction of power energy facilities, is related to NPC's principal business of power generation. In sum, NPC's control over PHESCO in matters concerning the performance of the latter's work is evident. It is enough that NPC has the right to wield such power to be considered as the employer.

Under this factual milieu, there is no doubt that PHESCO was engaged in "labor-only" contracting vis-à-vis NPC and as such, it is considered merely an agent of the latter. In labor-only contracting, an employer-employee relationship between the principal employer and the employees of the "labor-only" contractor is created. Accordingly, the principal employer is responsible to the employees of the "labor-only" contractor as if such employees had been directly employed by the principal employer. Since PHESCO is only a "labor- only" contractor, the workers it supplied to NPC, including the driver of the ill-fated truck, should be considered as employees of NPC. After all, it is axiomatic that any person (the principal employer) who enters into an agreement with a job contractor, either for the performance of a specified work or for the supply of manpower, assumes responsibility over the employees of the latter.

It is apparent that Article 2180 of the Civil Code and not the Labor Code, as NPC argues, that will determine the liability of NPC in a civil suit for damages instituted by an injured person for any negligent act of the employees of the "labor only" contractor. With respect to the liability of NPC as the direct employer, Article 2180 of the Civil Code explicitly provides:

Employers shall be liable for the damages caused by their employees and household helpers acting within the scope of their assigned tasks, even though the former are not engaged in any business or industry.

In this regard, NPC's liability is direct, primary and solidary with PHESCO and the driver. Of course, NPC, if the judgment for damages is satisfied by it, shall have recourse against PHESCO and the driver who committed the negligence which gave rise to the action.

Light Rail Transit vs. Navidad

G.R. No. 145804 (February 6, 2003)

Facts: On 14 October 1993, Nicanor Navidad, then drunk, entered the EDSA LRT station after purchasing a "token" (representing payment of the fare). While Navidad was standing on

the platform near the LRT tracks, Junelito Escartin, the security guard assigned to the area approached Navidad. A misunderstanding or an altercation between the two apparently ensued

that led to a fist fight. No evidence, however, was adduced to indicate how the fight started or who, between the two, delivered the first blow or how Navidad later fell on the LRT tracks.

At the exact moment that Navidad fell, an LRT train, operated by petitioner Rodolfo Roman, was coming in. Navidad was struck by the moving train, and he was killed instantaneously.

Nicanor’s widow filed a complaint for damages against Junelito Escartin, Rodolfo Roman, the LRTA, the Metro Transit Organization, Inc. (Metro Transit), and Prudent for the

death of her husband. The trial court rendered decision holding Prudent and Escartin jointly and severally liable. On appeal, the CA exonerated Prudent from any liability and, instead,

held the LRTA and Roman jointly and severally liable.

Issue: (1) Is LRTA liable? (2)Is Roman an employee of LRTA and also liable?

Held: (1)Yes. Law and jurisprudence dictate that a common carrier, both from the nature of its business and for reasons of public policy, is burdened with the duty of exercising utmost

diligence in ensuring the safety of passengers.

The foundation of LRTA’s liability is the contract of carriage and its obligation to indemnify the victim arises from the breach of that contract by reason of its failure to exercise the

high diligence required of the common carrier. In the discharge of its commitment to ensure the safety of passengers, a carrier may choose to hire its own employees or avail itself of the

services of an outsider or an independent firm to undertake the task. In either case, the common carrier is not relieved of its responsibilities under the contract of carriage.

Prudent’s liability, If any, could only be for tort under the provisions of Article 2176 and related provisions, in conjunction with Article 2180, of the Civil Code.

A contractual obligation can be breached by tort and when the same act or omission causes the injury, one resulting in culpa contractual and the other in culpa aquiliana, Article 2194 of the Civil Code can well apply. In fine, a liability for tort may arise even under a contract, where tort is that which breaches the contract. Stated differently, when an act which constitutes a breach of contract would have itself constituted the source of a quasi-delictual liability had no contract existed between the parties, the contract can be said to have been breached by tort, thereby allowing the rules on tort to apply.

However, the Court is concluded by the factual finding of the Court of Appeals that "there is nothing to link (Prudent) to the death of Nicanor (Navidad), for the reason that the negligence of its employee, Escartin, has not been duly proven x x x." This finding of the appellate court is not without substantial justification in our own review of the records of the case.

(2) No. There being no showing that Rodolfo Roman himself is guilty of any culpable act or omission, he must also be absolved from liability. Needless to say, the contractual tie

between the LRT and Navidad is not itself a juridical relation between the latter and Roman; thus, Roman can be made liable only for his own fault or negligence.

Mckee vs. IAC

211 SCRA 517 (1992)

Facts: Supra

Issues: (1) Did Galang’s negligence cause the collision? (2) Were Tayag and Manalo liable for damages?

Held: Yes. The lower court held that Jose Koh was negligent for improperly invading the lane of the truck. This is unwarranted because it is manifest that no negligence can be imputed to Koh. In Picart vs. Smith (37 Phil 809, 813) the Court held that:

The test by which to determine the existence of negligence in a particular case may be stated as follows: Did the defendant in doing the alleged negligent act use that (reasonable care and caution which an ordinarily prudent person would have used in the same situation?) If not, then he is guilty of negligence.

It is manifest that no negligence could be imputed to Jose Koh. Any reasonable and ordinary prudent man would have tried to avoid running over the two boys by swerving the car away from where they were even if this would mean entering the opposite lane.

The truck driver's negligence is apparent in the records. He himself said that his truck was running at 30 miles (48 kilometers) per hour along the bridge while the maximum speed allowed by law on a bridge is only 30 kilometers per hour. Under Article 2185 of the Civil Code, a person driving a vehicle is presumed negligent if at the time of the mishap, he was violating any traffic regulation. The truck driver's negligence was likewise duly established through the testimony of Araceli Koh McKee which was duly corroborated by the testimony of Eugenio Tanhueco, an impartial eyewitness to the mishap.

Clearly, therefore, it was the truck driver's subsequent negligence in failing to take the proper measures and degree of care necessary to avoid the collision which was the proximate cause of the resulting accident.

(2) Yes. It was the truck driver's negligence in failing to exert ordinary care to avoid the collision which was, in law, the proximate cause of the collision. As employers of the truck driver, the private respondents are, under Article 2180 of the Civil Code, directly and primarily liable for the resulting damages. The presumption that they are negligent flows from the negligence of their employee. That presumption, however, is only juris tantum, not juris et de jure. Their only possible defense is that they exercised all the diligence of a good father of a family to prevent the damage.

Valenzuela vs. CA

G.R. No. 115024 (1996)

Facts: The petitioner, Ma. Lourdes Valenzuela, was travelling along Aurora Blvd. with a companion, Cecilia Ramon, heading towards the direction of Manila. Suddenly, she noticed something wrong with her tires; she stopped at a lighted place where there were people, to verify whether she had a flat tire and to solicit help if needed. Having been told by the people present that her rear right tire was flat and that she cannot reach her home in that car's condition, she parked along the sidewalk. She was standing at the left side of the rear of her car pointing to the tools to a man who will help her fix the tire when she was suddenly bumped by a 1987 Mitsubishi Lancer driven by defendant Richard Li and registered in the name of defendant Alexander Commercial, Inc. In her complaint, plaintiff prayed for moral damages in the amount of P1 million, exemplary damages in the amount of P100,000.00 and other medical and related expenses amounting to a total of P180,000.00, including loss of expected earnings.

After trial, the lower court sustained the plaintiff's submissions and found defendant Richard Li guilty of gross negligence and liable for damages under Article 2176 of the Civil Code. The trial court likewise held Alexander Commercial, Inc., Li's employer, jointly and severally liable for damages pursuant to Article 2180.

Issues: (1) Whether or not, the petitioner is guilty of contributory negligence? (2) Whether or not, respondent’s employer, Alexander Commercial Inc, is liable for the acts of its employee?

RULING: (1) The SC ruled that the Valenzuela was not guilty of contributory negligence. Valenzuela did exercise the standard reasonably dictated by the emergency and could not be considered to have contributed to the unfortunate circumstances which eventually led to the amputation of one of her lower extremities. The emergency which led her to park her car on a sidewalk in Aurora Boulevard was not of her own making, and it was evident that she had taken all reasonable precautions.

(2) Likewise, the SC ruled that the relationship in question is not based on the principle of respondeat superior, which holds the master liable for acts of the servant, but that of pater familias, in which the liability ultimately falls upon the employer, for his failure to exercise the diligence of a good father of the family in the selection and supervision of his employees.

It is up to this point, however, that our agreement with the respondent court ends. Utilizing the bonus pater familias standard expressed in Article 2180 of the Civil Code, hence, the court is of the opinion that Li's employer, Alexander Commercial, Inc. is jointly and solidarily liable for the damage caused by the accident of June 24, 1990.

Vicarious liability of the State

E. Merritt vs Government Of The Philippine Islands

G.R. No. L-11154 March 21, 1916

Facts: E. Merritt was riding on a motorcycle travelling at ten to twelve miles per hour when he collided with the General Hospital ambulance which turned suddenly and unexpectedly

before reaching the center of the street and without sounding its whistle or horn in violation of the Motor Vehicle Act. The plaintiff suffered from fractures to the skull, material injury to

the grey matter and brain and a broken right leg as a result of the collision. He was mentally and physically impaired such that he lost his efficiency in constructing wooden buildings,

which was his occupation.

Act No. 2457 was enacted specifically to authorize E.Merritt to bring suit against the Government “in order to fix the responsibility for the collision between his motorcycle and

the ambulance of the General Hospital, and to determine the amount of the damages, if any, to which Mr. E. Merritt is entitled on account of said collision.” The court found the chauffeur of the ambulance solely negligent and awarded plaintiff a total P14,741.

Issue: Whether the Government is legally liable for the damages resulting from the collision committed by the agent or employee of the Government

RULING: The SC increased the total damages awarded to plaintiff to P18,075 since he was incapacitated for a period of six months and not only for the time he remained confined in the

hospital.

The general rule is that the Government cannot be sued by an individual without its consent. In accordance with Act No.2457, the plaintiff was authorized to bring action against the Government in order to fix the responsibility for the collision and to determine the amount of the damages, if any. However, Act No. 2457 does not operate to extend the

Government's liability to any cause not previously recognized. According to the Civil Code Article 1903 (now Art 2180):

“The state is liable in this sense when it acts through a special agent, but not when the damage should have been caused by the official to whom properly it pertained to do the act performed, in

which case the provisions of the preceding article shall be applicable.”

The responsibility of the state is limited to cases wherein it acts through a special agent; a special agent is one who receives a definite and fixed order or commission, foreign to the exercise of the duties of his office if he is a special official. This does not apply to any executive agent who is an employee of the acting administration and who on his own responsibility performs the functions which are inherent in and naturally pertain to his office and which are regulated by law and the regulations.

Therefore, the State is only liable for the acts of its agents, officers and employees when they act as special agents within the meaning of paragraph 5 of article 1903 (now Article 2180); and that the chauffeur of the ambulance of the General Hospital was not such an agent for which the State is made liable.

Inocencio Rosete vs.The Auditor General

G.R. No. L-1120 (August 31, 1948)

Facts: Inocencio Rosete and others filed a claim against the Government for damages caused to buildings belonging to the claimants, which were destroyed by fire from the contiguous warehouse of the Emergency Control Administration, ECA, an office or agency of the Government. The fire was initiated by the reckless ignition of a cigarette-lighter by a certain Jose Frayno y Panlilio near a five-gallon drum where gasoline was drained and stored in contrary to the provisions of Ordinances of the City of Manila.

The Insular Auditor denied or dismissed the claim of Rosete and others in the amount of P35,376.

Issue: Whether the government is liable for the damages sustained by the claimant under article 1903 of the Civil Code (now Article 2180)

Ruling: The pertinent provision reads as follows:

ART. 1903. The obligation imposed by the preceding article is enforceable not only for personal acts and omissions but also for those persons for whom another is responsible.

The state is liable in the scene when it acts through a special agent, but not when the damage should have been caused by the official to whom it properly pertained to do the act performed, in which case the provisions of the preceding article shall be applicable.

The court citing Merritt vs. Government of the Philippine Islands held that the state is not liable for damages suffered by private individuals by government employees in the discharge of their responsibilities unless such act was committed by a special agent, “duly empowered by a definite order or commission to perform some act or charged with some definite purpose which gives rise to the claim.” Since the officers of the ECA did not act as special agents and there is no negligence imputable to a special agent, the government is not liable for the damages resulting from the negligence complained of.

Act No. 327, authorizing the filing of claims against the Government with the Insular Auditor, does not make any and all claims against the Government allowable or the Government responsible for such claims.

Mendoza vs. De Leon, et al.

G.R. No. L-9596 February 11, 1916

Facts: Marcos Mendoza was the highest bidder for the lease of an exclusive ferry privilege in the municipality of Villasis, Pangasinan, and was duly awarded the privilege under the provisions of Act No. 1643 of the Philippine Commission. After a little more than a year, the municipal council of Villasis, Pangasinan, through a resolution, awarded the franchise for the same ferry to another person, forcibly ejecting Mendoza therefrom. The council claimed that the ferry Mendoza was operating was not the one leased to him.

Mendoza instituted an action for damages against the individual members of the Municipal Council.

Issue: Whether the individual members of the Municipal Council are liable to Mendoza for forcibly ejecting him from the leased ferry

Ruling: A municipality has a two-fold character of powers, namely governmental and proprietary. With respect to liability, numerous cases elucidate that the municipality is liable for the acts of its officers and agents in the exercise of proprietary or corporate powers, but it is not liable for the acts of its officers or agents in the performance of its governmental functions.

Officers or agents of the Government charged with the performance of governmental duties are not liable for the consequences of their official acts, unless they have acted willfully and maliciously, and with the express purpose of inflicting injury.

In so far as its governmental functions are concerned, a municipality is also not liable, unless expressly made so by statute; nor are its officers, so long as they perform their duties honestly and in good faith.

But a municipality is not exempt from liability for the negligent performance of its corporate or proprietary or business functions. In the administration of its patrimonial property, it is to be regarded as a private corporation or individual so far as its liability to third persons on contract or in tort is concerned.

Mendoza had a vested right to the exclusive operation of the ferry; and there is no evidence that there was justifiable reason for his eviction. The contention that Mendoza was operating a ferry that was not leased to him is untenable since it was the vice-president himself who personally placed him in possession thereof, a fact know to the council members.

It cannot be said that the councilors acted honestly for the interests of the municipality. Therefore, they are jointly and severally liable for the damages sustained by the plaintiff from the rescission of his contract of lease of the ferry privilege in question.

Fontanilla vs. Maliaman

G.R. No. L-55963 December 1, 1989

FACTS: Francisco Fontanilla, son of the spouses Jose and Virginia Fontanilla, died as a result of an accident when a pickup owned and operated by the National Irrigation Administration, a government agency, driven by Hugo Garcia (a regular employee of said agency) bumped the bicycle he was riding. The deceased was thrown 50 meters from the point of impact, while his companion, who survived the incident, was thrown a bit further away. Nevertheless, the NIA employees did not stop to assist the victims and instead sped away.

The trial court directed respondent National Irrigation Administration to pay damages (death benefits) and actual expenses to petitioners.

Issue: Whether or not the award of moral damages, exemplary damages and attorney's fees is legally proper in a complaint for damages based on quasi-delict against the NIA

Ruling: The liability of the State has two aspects. namely:

1. Its public or governmental aspects where it is liable for the tortious acts of special agents only.

2. Its private or business aspects where it becomes liable as an ordinary employer.

The National Irrigation Administration is a government corporation and exercises proprietary functions, by express provision of Rep. Act No. 3601. As a corporate body performing non-governmental functions, it is liable as an ordinary employer for the acts of its employees. As such, the NIA becomes answerable for damages caused by its employees upon the existence of negligence of supervision on its part.

At the time the accident took place, the employees and the driver did not assist the victims and instead sped off even though there were dent marks indicating they were aware they hit something or someone. The strength of the impact also indicated that they were driving at a high speed at the time the collision occurred.

There was evident negligence on the part of NIA when its supervisor within the group allowed the driver to travel at a high speed.

Considering the foregoing, respondent NIA is hereby directed to pay herein petitioners-spouses the amounts of P12,000.00 for the death of Francisco Fontanilla; P3,389.00 for hospitalization and burial expenses of the aforenamed deceased; P30,000.00 as moral damages; P8,000.00 as exemplary damages and attorney's fees of 20% of the total award.

City of Manila vs. Teotico

G.R. No. L-23052 (January 29, 1968)

Facts: Genaro N. Teotico fell inside an uncovered and unlighted manhole when he attempted to board a jeepney at a "loading and unloading" zone. As a result of the fall, Teotico’s

eyeglasses broke and its shards pierced his left eyelid, impairing his vision. Aside from the lacerated wound in his left upper eyelid, he also suffered from several contusions to his body

and an allergic eruption caused by anti-tetanus injections administered to him in the hospital. His medical expenses amounted to P1,400.00.

As a consequence of the foregoing occurrence, Teotico filed a complaint for damages against the City of Manila, its mayor, city engineer, city health officer, city treasurer and chief

of police. The City of Manila and its officers contended that every time a report that a cover of a manhole is missing, the Office of the City Engineer immediately had it replaced and that

they were attentive thereto.

The trial court rendered a decision in favour of the City of Manila but the Court of Appeals sentenced the City of Manila to pay damages amounting to P6,750.00.

Issue: Whether the City of Manila is liable for payment of damages to Teotico

Held: Between RA 409, the Charter of Manila, exempting the City from liability, and the Civil Code, the Civil Code applies because its subject-matter is more particular. RA 409 refers to liability arising from negligence, in general, regardless of the object thereof. On the other hand, Article 2189 of the Civil Code of the Philippines provides:

Provinces, cities and municipalities shall be liable for damages for the death of, or injuries suffered by, any person by reason of defective conditions of road, streets, bridges, public buildings, and other public works under their control or supervision.

Article 2189 governs liability due to "defective streets," in particular. Since the present action is based upon the alleged defective condition of a road, said Article 2189 is decisive thereon.

Even assuming that the incident took place in a national highway, it is not necessary for liability to attach that the defective roads or streets belongs to the province, city or municipality from which responsibility is exacted. What Article 2189 requires is that the province, city or municipality have either "control or supervision" over said street or road.

Republic Act No. 917 provides that the construction, maintenance and improvement of national, provincial and city roads shall be accomplished by the Highway District Engineers and Highway City Engineers.

Liability of employees

Araneta vs. De Joya

G.R. No. L-25172 (May 24, 1974)

Facts: Antonio de Joya was the general manager of the Ace Advertising. He proposed that an employee, Ricardo Taylor, be sent to the United States to take up special studies in

television. Although the board of directors failed to act on the proposal, Taylor was still sent to the US, with the assurance that Taylor’s expenses would be defrayed by parties other

Taylor received his salaries while abroad through checks and vouchers signed by Luis Araneta (vice-president), Vicente Araneta (company treasurer) or de Joya. The total costs

of Taylor’s travel and study expenses was P 5,043.20.

Ace Advertising filed a complaint with the court for the recovery of the total amount disbursed to Taylor since the travel and expenses were made without its knowledge,

authority or ratification. A third-party complaint was filed by de Joya against Vicente Araneta, Luis Araneta and Taylor.

Both Aranetas disowned any personal liability, claiming that they signed the checks covering part of the travel expenses and payroll in good faith since they were approved by de

Joya.

The trial court ruled that de Joya was liable for the amount disbursed by the company but dismissed the third party complaint, while the Court of Appeals held that according to

the facts of the case, the two Aranetas were also privy to the unauthorized disbursement of the corporate moneys jointly with the appellant.

Issue: Whether Luis Araneta is solidarily liable with de Joya and Vicente Araneta for payment of the erroneously disbursed funds.

Ruling: Luis Araneta is guilty of a quasi-delict. His allegations of good faith were not substantiated and established. In fact, as vice-president of the company, Luis Araneta remained

passive concerning the unauthorized disbursement of corporate funds and approved three of the payroll checks for Taylor’s salary. Luis Araneta evidently neglected to perform his duties

as an officer of the firm.

Applying Article 2194 of the New Civil Code, it is proper that the other joint tortfeasors be made solidarily liable and shoulder their proportional responsibility.

Engineers/Architect- Nature of liability

Lanuzo vs. Sy Bon Ping

G.R. No. L-53064 September 25, 1980

Facts: Salvador Mendoza, driver of Sy Bon Ping, recklessly and negligently rammed the residential house and store or Felix Lanuzo. The total damage to his property was P13,000 and he was deprived of his monthly income from the store of P300.

In a complaint for damages instituted by Lanuzo independently from the criminal action, the trial court ruled that Sy Bon Ping and Mendoza were jointly and severally liable to pay Lanuzo P 13,000.00 as damages and P 300.00, representing Lanuzo’s monthly income, until the entire P 13,000.00 has been paid in full.

Issue: Whether Sy Bon Ping, as employer, and Mendoza, as employee are solidarily liable for payment of damages to Lanuzo

Held: Plaintiff predicated his claim for damages on quasi-delict, which may proceed independently and regardless of the result of the criminal case. Salvador Mendoza is evidently primarily liable for his reckless driving resulting to the damage caused to Lanuzo under Article 2176 of the Civil Code

Sy Bon Ping, as employer, is also primary and direct under Article 2180 of the Civil Code, which explicitly provides:

Sy Bon Ping failed to disprove the legal presumption of his negligence in the selection and supervision of this employee (Article 2180) and is primary and solidarily liable with Mendoza. Nevertheless, Sy Bon Ping may demand reimbursement from Mendoza for whatever amount he will have to pay the offended party to satisfy the claim for damages.

Malipol vs. Tan

G.R. No. L-27730 January 21, 1974

Facts: Pantaleon Malijan was walking with his companion Leonardo Amante when he was hit by a gasoline tanker, got thrown to the ground and was ran over by the tanker’s right wheel

that got detached. Although he was brought to the hospital, Malijan died that night from "possible traumatic cerebral hemorrhage due to vehicular accident."

The gasoline tanker at that time was driven by Ernesto Labsan and was used and owned by Lily Lim Tan for her gasoline business. The mother and minor siblings of Malijan

filed a complaint for damages against Tan and Labsan. The trial court ruled that Labsan was primarily liable to pay the damages, and in case he would not be able to do so, Tan would be

subsidiarily liable.

Issue: Whether the trial court erred in ruling Labsan as primarily liable for damages, and Tan as subsidiarily liable.

Held: The court ruled that the trial court correctly denied the motion to set aside order of default and for new trial; however, the trial court erred in holding Tan subsidiarily liable.

The action was based on quasi-delict and not to demand civil liability arising from a crime, since the complaint makes no mention of a crime. Under Article 2180 of the Civil

Code, the liability of the owners and managers of an establishment or enterprise for damages caused by their employees is primary and direct, not subsidiary.

Therefore, the employer, Lily Lim Tan, must be held primarily and directly, not subsidiarily, liable for damages awarded in the decision of the lower court, without prejudice to the right to demand reimbursement from damages from Ernesto Labsan for whatever she would have to pay the relatives of the deceased.

Viluan vs. CA

G.R. Nos. L-21477-81 (April 29, 1966)

Facts: The bus owned by Francisca Viluan, and driven by Hermenigildo Aquino raced with the overtaking bus driven by Gregorio Hufana and owned by Patricio Hufana. Aquino lost

control of the bus, hitting a post and crashing into a tree, after which it burst into flames wherein seven persons were killed and thirteen others were injured.

In the complaint for breach of contract of carriage and damages filed by the heirs of those who perished in the incident and Carolina Sabado, an injured passenger, Vilaun and

Aquino filed third party complaints against Gregorio Hufana and his employer, Patricio Hufana, contending that the incident was their fault.

The lower court found that the accident was due to the concurrent negligence of the drivers of the two buses and held both the two drivers and their employers jointly and

severally liable for damages.

The Court of Appeals affirmed the finding of concurrent negligence on the part of the two buses but held that only Vilaun is liable because Aquino, as driver, cannot be made

jointly and severally liable in a contract of carriage. It ruled that the Hufana’s cannot be made liable since the plaintiffs did not amend their complaints in the main action so as to assert a

claim against them.

Issue: Whether Patricio and Gregorio Hufana should be made equally liable although they were third-party defendants and not principal defendants

Held: The fact that the respondents were not sued as principal defendants but were brought into the cases as third party defendants should not preclude a finding of their liability.

Section 5 Rule 12 of the Rules of Court, precluding a judgment in favor of a plaintiff and against a third party defendant where the plaintiff has not amended his complaint to assert a claim against a third party defendant, applies only to cases where the third party defendant is brought in on an allegation of liability to the defendants. It does not apply where a third-

party defendant is impleaded on the ground of direct liability to the plaintiffs, in which case no amendment of the plaintiffs complaint is necessary.

In this case the third-party complaints filed by Viluan and Aquino charged Gregorio and Patrcio Hufana with direct liability to the plaintiffs. Amendment of the complaint is not necessary and is merely a matter of form since the liability of the Hufana’s as third-party defendant was already asserted in the third-party complaint.

Regardless whether the injury is quasi-delict or breach of contract of carriage, in case of injury to a passenger due to the negligence of the driver of the bus on which he was riding and of the driver of another vehicle, the drivers as well as the owners of the two vehicles are jointly and severally liable for damages.

Torts with Independent Civil Actions (Violation of Civil and Political rights)

Lim vs. Ponce De Leon

G.R. No. L-22554 August 29, 1975

Jikil Taha sold a motor launch named M/L "SAN RAFAEL" to Alberto Timbangcaya but a year later Timbangcaya filed a complaint with the Office of the Provincial

Facts:

Fiscal that Taha forcibly took the motor launch.

Fiscal Francisco Ponce de Leon in his capacity as Acting Provincial Fiscal of Palawan, filed an information for Robbery with Force and Intimidation upon Persons against Jikil

Taha and instructed Orlando Maddela, Detachment Commander of Balabac to impound and take custody of the motor launch, which was already sold to Delfin Lim. Fiscal de Leon

informed Maddela that the subsequent sale of the launch to Delfin Lim could not prevent the court from taking custody of the same.

Lim filed a complaint for damages against Fiscal de Leon and Maddela. Lim contended that there was a violation of his constitutional rights when the motor launch was seized without a

search warrant. As defense, de Leon and Maddela contended that the motor launch was the corpus delicti in an ongoing investigation and filed a counterclaim for malicious and

groundless filing of the complaint by Lim and Taha.

The trial court upheld the validity of the seizure of the motor launch and ordered Taha and Lim to pay for damages.

Issue: Whether the constitutional rights of Jakil Taha and Delfin Lim was violated, and if so, whether they are entitled to damages

Held: The taking of the motor launch was ruled to be in violation of the constitutional right of the parties against unreasonable searches and seizure as provided in the Bill of Rights since

it was effected without a search warrant, the authority of which lies with a magistrate or judge and not a fiscal.

With respect to damages, Delfin Lim and Jikil Taha were entitled to damages under Article 32 and 2219 of the New Civil Code for the violation of their constitutional right.

Good faith is not a defense against liability under Article 32 of the NCC. To be liable it is enough that there was a violation of the constitutional rights of the plaintiffs and it is not

required that the act was attended with bad faith or malice.

Therefore, Fiscal de Leon was liable to pay damages to Delfin Lim for violating his constitutional right; but Orlando Maddela cannot be held accountable because he acted upon the order of his superior officer believing that there was a legal basis and authority to impound the launch.

Aberca vs. Ver

G.R. No. L-69866 April 15, 1988

Facts: The intelligence units of the Armed Forces of the Philippines, known as Task Force Makabansa (TFM), were ordered by General Fabian Ver "to conduct pre-emptive strikes against known communist-terrorist (CT). The plaintiffs complained that in the execution of such order, the TFM raided several places using “defectively issued judicial warrants” and arrested the plaintiffs without warrant, confiscated personal property, interrogated plaintiffs without council and employed threats, tortures and other forms of violence.

The plaintiffs filed an action for damages, which was dismissed by the trial court on the grounds that (1) the privilege of the writ of habeas corpus was suspended, (2) the defendants were performing their official duties and (3)the complaint states no cause of action.

Issue: Whether the suspension of the privilege of the writ of habeas corpus bars a civil action for damages for illegal searches conducted by military personnel and other violations of rights and liberties guaranteed under the Constitution, and if so, who should be made liable

Held: The contention that respondents are covered by state immunity for acts done in the performance of their official duties was not accepted by the court because plaintiffs may have been ordered to conduct pre-emptive strikes against the communist terrorists but this did not amount to “a blanket license or a roving commission untramelled by any constitutional restraint”. In carrying out their task and mission, constitutional and legal safeguards should still have been observed by respondents.

The plaintiff’s cause of action were not barred by the suspension of the privilege of the writ of habeas corpus, which was explicitly recognized in PD No. 1755:

However, when the action (for injury to the rights of the plaintiff or for a quasi-delict) arises from or out of any act, activity or conduct of any public officer involving the exercise of powers or authority arising from Martial Law including the arrest, detention and/or trial of the plaintiff, the same must be brought within one (1) year.

Even if the suspension of the privilege of the writ of habeas corpus suspended petitioners' right of action for damages for illegal arrest and detention, it did not extend to suspend their right to demand damages for injuries suffered through the confiscation of their private belongings, the violation of their right to remain silent and to counsel and their right to protection against unreasonable searches and seizures and against torture and other cruel and inhuman treatment.

As to who should be made liable for damages, the doctrine of respondent superior is applicable to the case. Article 32 speaks of “an officer or employee or person 'directly' or "indirectly" responsible for the violation of the constitutional rights and liberties of another”. Thus, the person directly causing damage and the person indirectly responsible has also to answer for the damages or injury caused to the aggrieved party. Article 32 of the Civil Code encompasses within the ambit of its provisions those directly, as well as indirectly, responsible for its violation.

MHP Garments vs. CA

G.R. No. 86720 September 2, 1994

Facts: MHP Garments, Inc. had the exclusive franchise to sell and distribute official Boy Scouts uniforms, supplies, badges, and insignias. When MHP Garments received information that Agnes Villa Cruz, Mirasol Lugatiman, and Gertrudes Gonzales were selling Boy Scouts items and paraphernalia without any authority, Larry de Guzman, an employee of MHP Garments, together with members of the police constabulary, went to the stores of Cruz, Lugatiman, and Gonzales at the Marikina Public Market and seized these items. The seizure caused a commotion to the embarrassment of Cruz, Lugatiman and Gonzales.

MHP Garments instituted a criminal complaint for unfair competition against the vendors. The Provincial fiscal dismissed the complaint and ordered the return of the seized items. Cruz, Lugatiman and Gonzales instituteed an action for sums of money and damages against MHP Garments and de Guzman. MHP Garments contend that they should not be made liable for damages since they did not commit the act of seizure.

Issue: Whether MHP Garments and de Guzman should be held liable for the seizure of the goods in question although it was the Police constabulary who effected the seizure

Held: The seizure was conducted without a warrant in evident violation of the constitutional right of the vendors. The facts of the case did not justify the warrantless search and seizure of the vendors’ goods. There was sufficient time for de Guzman in behalf of MHP Garments to secure a warrant from the time of receipt of the information and the raid of the stores.

Although the Philippine Constabulary conducted the raid, their omission as party to the complaint does not exculpate MHP Garments and de Guzman from liability. The company was indirectly involved in transgressing the rights of Cuz, Lugatiman and Gonzales.

It was MHP Garments who instigated the raid and the raid was conducted with the active participation of their employee, Larry de Guzman, who apparently assented to the conduct of the raid and is as liable to the same extent as the officers themselves. The corporation is also liable to the same extent as the officers when it received the goods for safekeeping and refused to surrender them for quite a time despite the dismissal of its complaint for unfair competition.

Independent Civil Action (Defamation, Fraud and Physical Injuries)

Marcia et al. vs.CA

G.R. No. L-34529 January 27, 1983

Facts: A passenger bus operated by private respondent Victory Liner, Inc.,driven by its employee, Felardo Paje, collided with a jeep driven by Clemente Marcia, resulting in the latter's death and in physical injuries to Edgar Marcia and Renato Yap.

An information for homicide and serious physical injuries thru reckless imprudence was filed against the driver while an action for damages was filed by Edgar Marcia and Renato Yap, and the heirs of Clemente Marcia against the Victory Liner, Inc. and Felardo Paje.

The trial court initially convicted Paje of the offense charged, but on appeal, Paje was acquitted after it was found that he was not speeding and was diligent, but the collision, nevertheless, took place and was a fortuitous event. It further ruled that criminal negligence was wanting and that Paje was not even guilty of civil negligence.

The court dismissed the civil case against Paje and Victory Liner ruling that they could not be held civilly liable after it had ruled in the criminal action that negligence was wanting and that the collision was a case of pure accident.

Issue: Whether the acquittal in the criminal case would result in the dismissal in the civil case

Held: The judgment of acquittal included a declaration that the fact from which civil liability may arise did not exist. In acquitting Paje, the court ruled that the event was an accident and that Paje was without fault, and it is only proper that the civil case be dismissed.

Furthermore, the charge against Felardo Paje was not for homicide and physical injuries but for reckless imprudence or criminal negligence resulting in homicide and physical injuries. They are not one of the three (3) crimes mentioned in Article 33 of the Civil Code and, therefore, no civil action shall proceed independently of the criminal prosecution, which provides:

ART. 33. In cases of defamation, fraud, and physical injuries, a civil action for damages, entirely separate and distinct from the criminal action may be brought by the injured party. Such civil action shall proceed independently of the criminal prosecution, and shall require only a preponderance of evidence.

Therefore, it was only proper that the court dismiss the civil case against Paje and Victory Liner since Paje was acquitted of the fact from which the civil case arose.

Madeja v. Caro

211 Phil 469 (December 21, 1983)

Facts: Dra. Eva Japzon is accused of homicide through reckless imprudence for the death of Cleto Madejo after an appendectomy. The widow of Madejo filed a criminal complaint and reserved her right to claim for a separate action for damages. The judge dismissed the civil case because of Rule 111 3(a) but the petitioner appealed to the SC by using Rule 111 Section 2 ROC in relation to Article 33 of the NCC, which states:

Sec. 2. Independent civil action. — In the cases provided for in Articles 31, 32, 33, 34 and 2177 of the Civil Code of the Philippines, an independent civil action entirely separate and distinct from

the criminal action, may be brought by the injured party during the pendency of the criminal case, provided the right is reserved as required in the preceding section. Such civil action shall proceed independently of the criminal prosecution, and shall require only a preponderance of evidence." (Rule 111, Rules of Court.)

Art. 33. In cases of defamation, fraud, and physical injuries, a civil action for damages, entirely separate and distinct from the criminal action, may be brought by the injured party. Such civil action shall proceed independently of the criminal prosecution, and shall require only a preponderance of evidence.

The Court found the case impressed with merit.

Issues: (1) Whether or not the civil case can carry on independently of the criminal case. (2) Whether or not physical injuries of Article 33 encompass other bodily injury in its definition

Held: (1)Yes. Rule 111 Section 2 creates an exception to the rule when the offense is defamation, fraud, or physical injuries. In these cases, a civil action may be filed independently of the criminal action, even if there has been no reservation made by the injured party; the law itself in this article makes such reservation.

(2) Yes. The Code Commission discussed that the term "physical injuries" is used in a generic sense. It is not the crime of physical injuries defined in the Revised Penal Code. It includes not only physical injuries by consummated, frustrated and attempted homicide but also any other bodily injury including battery based on the American Law.

Arafiles v. Phil. Journalists

GR No 135306 (2003)

Facts: In 1987, Emelita Despuig, working as a grant-in-aid scholar at a Manila university and as an office worker at a government office in Quezon City, was raped by her boss, a government agency director, last March 15, but afraid to lose her job – and of being harmed – she chose to keep her ordeal to herself.

On the second night, she was almost raped again by the same man, Catalino Arafiles. However, the bellboy and the security guard noticed something suspicious as Emelita was fighting back while they were checking in the Flamingo Hotel, thus the bellboy followed them to their room. Arafiles rushed to leave as soon as he paid money to the bellboy and the security guard not to report the same.

Emelita reported the same information to the police and she was interviewed by Romy Morales, a journalist of People’s Journal Tonight. During the following day, the news was part of the headlines in the said newspaper. After a year of publication, Arafiles filed a complaint for damages arising from the said publication against the journalist and its employer.

Arafiles alleged that on account of the “grossly malicious and overly sensationalized reporting in the news item” prepared by respondent Morales, edited by respondent Buan, Jr., allowed for publication by respondent Villareal, Jr. as president of Philippine Journalists, Inc., and published by respondent Philippine Journalists, Inc., aspersions were cast on his character; his reputation as a director of the NIAS at the Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA) was injured; he became the object of public contempt and ridicule as he was depicted as a sex-crazed stalker and serial rapist; and the news item deferred his promotion to the position of Deputy Administrator of PAGASA. The RTC of Quezon City ruled in favor of Arafiles granting him awards for damages. 1.) P1,000,000.00, as nominal damages; 2.) P50,000.00, as exemplary damages; 3.) P1,000.000.00, as moral damages; 4.) P50,000.00, as attorney’s fees; and 5.) Costs of suit. .

CA reversed RTC’s decision. MR from CA made by Arafiles was denied. Hence they elevated it to the SC.

Issue: Whether or not the publication of the news item was not attended with malice, hence, must free respondents of liability for damages.

Held: Yes. There was no malice in the article. Art. 33. In cases of defamation, fraud, and physical injuries, a civil action for damages, entirely separate and distinct from the criminal action, may be brought by the injured party. Such civil action shall proceed independently of the criminal prosecution, shall require only a preponderance of evidence.

Article 33 contemplates a civil action for the recovery of damages that is entirely unrelated to the purely criminal aspect of the case. A civil action for libel under this article shall be instituted and prosecuted to final judgment and proved by preponderance of evidence separately from and entirely independent of the institution, pendency or result of the criminal action because it is governed by the provisions of the New Civil Code and not by the Revised Penal Code governing the criminal offense charged and the civil liability arising therefrom

In actions for damages for libel, it is axiomatic that the published work alleged to contain libelous material must be examined and viewed as a whole. The article must be construed as an entirety including the headlines, as they may enlarge, explain, or restrict or be enlarged, explained or strengthened or restricted by the context. Whether or not it is libelous, depends upon the scope, spirit and motive of the publication taken in its entirety.

Arafiles brands the news item as a “malicious sensationalization” of a patently embellished and salacious narration of fabricated facts involving rape and attempted rape incidents. For, so petitioner argues, the police blotter which was the sole basis for the news item plainly shows that there was only one count of abduction and rape reported by Emelita.

The presentation of the news item subject of petitioner’s complaint may have been in a sensational manner, but it is not per se illegal. In determining the manner in which a given event should be presented as a news item and the importance to be attached thereto, newspapers must enjoy a certain degree of discretion.

Defamation

MVRS vs. Islamic

GR 135306 (January 28, 2003)

Facts: Bulgar, a local tabloid, published an article in 1992 about the Muslim’s practical customs stating:

ALAM BA NINYO?

Na ang mga baboy at kahit anong uri ng hayop sa Mindanao ay hindi kinakain ng mga Muslim?

Para sa kanila ang mga ito ay isang sagradong bagay. Hindi nila ito kailangang kainin kahit na sila pa ay magutom at mawalan ng ulam sa tuwing sila ay kakain. Ginagawa nila itong Diyos at sinasamba pa nila ito sa tuwing araw ng kanilang pangingilin lalung-lalo na sa araw na tinatawag nilang ‘Ramadan’."

Islamic Da’wah Council of the Philippines filed a complaint alleging the libelous statement as insulting and damaging because words alluding to pig as the God of Muslims were with intent to hurt the feelings, cast insult, and disparage the Muslims and Islam.

MVRS contended however, that they did not mention respondents as the object of the article, thus not entitled to damages.

In defense, the article was only an expression of their belief or opinion.

The RTC dismissed their case because there was no cause of action. The plaintiffs were not specifically identified for defmation.

In 1998, the CA reversed the decision.

Hence, this review.

Issue: Whether or not the Islamic Council was entitled to moral damages, exemplary damages, attorney’s feed, and costs of suit

Held: No. Words that are merely insulting are not actionable as libel or slander per se. Mere words of abuse whether written or spoken do not constitute a basis for an action for defamation in the absence of an allegation for special damages. There is NO identifiable person who was allegedly injured by the article. Muslims do not have a single common reputation that will give them a common or general interest in the subject matter of the controversy.

Requisites to recovery are the following:

1. Published a statement

2. That was defamatory

3. Of and concerning the plaintiff

To maintain an action, the plaintiff must be the person with reference to whom the statement was made as this is vital for a group or class to prove they have been defamed.

Fraud

Salta v. De Veyra

202 Phil 527 (September 30, 1982)

Facts: Amayra Salta was employed as branch manager of the Philippine National Bank (PNB). As such, his duty was to grant loans or to recommend the granting of loans, depending on the the amount of the loan applied for.

PNB filed two civil complaints against Salta charging him of indiscriminately granting certain loans in a manner characterized by negligence, fraud, and manifest partiality, and upon securities not commensurate with the amount of the loans. The two civil cases were assigned to two different salas of the Court of First Instance of Manila. At the same time, the bank caused to be filed, a criminal case, based on the same acts.

Petitioner was acquitted in the criminal case on the ground that the elements of the crime charged were not proven. Based on his acquittal petitioner filed a Motion to Dismiss in each of the two civil cases. The two presiding judges in the separate civil cases took diametrically opposing views. One judge denied his motion and the other granted it. Hence, these petitions by the Philippine National Bank in one case and by Salta in the other.

Issue: Whether or not the motion to dismiss the civil cases should be affirmed or denied.

Held: The motion to dismiss should be denied and the other order granting such should be reversed. The filing in this case of a civil action separate from the criminal action is fully warranted under the provision of Article 33 of the New Civil Code.

The criminal case is for the prosecution of an offense the main element of which is fraud. . Based on the same acts for which the criminal action was filed, the civil actions very clearly alleged fraud and negligence as having given rise to the cause of action averred in the complaints. The following allegation in the complaints unmistakably shows that the complaints do contain sufficient averment of fraud: "That there was fraud committed by the defendant in granting the aforesaid loans which rendered him liable for his acts, which fraud is positively and easily identifiable in the manner and scheme aforementioned."

The civil actions can be maintained regardless of the outcome of the criminal action.

Physical Injuries

Capuno v. Pepsi Cola

G.R. No. L-19331 (1965)

Facts: The case arose from a vehicular collision which occurred on January 3, 1953 in Apalit, Pampanga. Involved were a Pepsi-Cola delivery truck driven by Jon Elordi and a private car driven by Capuno. The collision proved fatal to the latter as well as to his passengers, the spouses Florencio Buan and Rizalina Paras.

Elordi was charged with triple homicide through reckless imprudence; the information was subsequently amended to include claims for damages by the heirs of the three victims. While the criminal case was pending, the Intestate Estate of the Buan spouse and their heirs filed a civil case. Included in the complaint was a claim for indemnity in the sum of P2,623.00 allegedly paid by the Estate to the heirs of Capuno under the Workmen's Compensation Act.

On June 11, 1958 the parties in Civil Case No. 838 entered into a "Compromise and Settlement." For P290,000.00 the Buan Estate gave up its claims for damages, including the claim for reimbursement of the sum of P2,623.00 previously paid to the heirs of Capuno "under the Workmen's Compensation Act." The Court approved the compromise and accordingly dismissed the case on the following June 17.

At that time the criminal case was still pending; judgment was rendered only on April 15, 1959, wherein the accused Elordi was acquitted of the charges against him. Prior thereto, or on September 26, 1958, however, herein appellants commenced a civil action for damages against the Pepsi-Cola Bottling Company of the Philippines and Jon Elordi. This is the action which, upon appellees' motion, was dismissed by the Court a quo in its order of February 29, 1960, from which order the present appeal has been taken.

Issue: Whether or not the action had already prescribed.

Held: Yes. The action has prescribed. The civil action for damages could have been commenced by appellants immediately upon the death of their decedent, Cipriano Capuno, on January 3, 1953 or thereabouts, and the same would not have been stayed by the filing of the criminal action for homicide through reckless imprudence. But the complaint here was filed only on September 26, 1958, or after the lapse of more than five years.

In the case of Diocosa Paulan, et al. vs. Zacarias Sarabia, et al., G.R. No. L-10542, promulgated July 31, 1958, SC held that an action based on a quasi-delict is governed by Article 1150 of the Civil Code as to the question of when the prescriptive period of four years shall begin to run, that is, "from the day (the action) may be brought," which means from the day the quasi-delict occurred or was committed.

The foregoing considerations dispose of appellants' contention that the four-year period of prescription in this case was interrupted by the filing of the criminal action against Jon Elordi inasmuch as they had neither waived the civil action nor reserved the right to institute it separately. Such reservation was not then necessary; without having made it they could file

— as in fact they did — a separate civil action even during the pendency of the criminal case and consequently, as held in Paulan v. Sarabia, supra, "the institution of a criminal action cannot have the effect of interrupting the institution of a civil action based on a quasi-delict."

Corpus v. Paje

G.R. No. L-26737 (1969)

Facts: On December 23, 1956, a passenger bus of the Victory Liner Transportation Co., Inc., driven by Felardo Paje, collided within the municipality of Lubao, Pampanga, with a jeep driven by Clemente Marcia, resulting in the latter's death and in physical injuries to two other persons.

An information for homicide and double serious physical injuries through reckless imprudence was filed against Felardo Paje. In 1962, the heirs of Clemente Marcia reserved their right to institute a separate civil action for damages. Paje was convicted and pending appeal, the heirs of the Clemente Marcia filed a separate civil action for damages based on the criminal act and praying that Victory Liner pay jointly and severally the damages claimed by the heirs. Paje was acquitted by the CA. During the pre-trial of the civil case, the Court dismissed the same because the cause of action being a quasi-delict has prescribed.

Issue: Whether or not the dismissal of the case is proper by reason of prescription

Held: Yes. The trial court’s finding was correct that the cause of action has prescribed in 1962. An action upon a quasi-delict must be instituted within four (4) years (Article 1146, Civil Code). The four-year prescriptive period began to run from the day the quasi-delict was committed, or from December 23, 1956, and the running of the period was not interrupted by the institution of the criminal action for reckless imprudence. Six years have already lapsed.

Dulay v. CA

GR No 108017 (1995)

Facts: On December 7, 1988, an altercation between Benigno Torzuela and Atty. Napoleon Dulay occurred at the "Big Bang sa Alabang," Alabang Village, Muntinlupa as a result of which Benigno Torzuela, the security guard on duty at the said carnival, shot and killed Atty. Napoleon Dulay.

The widow of Atty. Dulay filed an action for damages against the employer and the security guard and prayed to be awarded actual, compensatory, moral and exemplary damages, and attorney's fees. She alleges that the Secuity agency has concurrent negligence as Torzuela, their employee:

“ Defendant TORZUELA'S wanton and reckless discharge of the firearm issued to him by defendant SAFEGUARD and/or SUPERGUARD was the immediate and proximate cause of the injury, while the negligence of defendant SAFEGUARD and/or SUPERGUARD consists in its having failed to exercise the diligence of a good father of a family in the supervision and control of its employee to avoid the injury.”

SUPERGUARD filed a Motion to Dismiss on the ground that the complaint does not state a valid cause of action. SUPERGUARD claimed that Torzuela's act of shooting Dulay was beyond the scope of his duties, and that since the alleged act of shooting was committed with deliberate intent (dolo), the civil liability therefore is governed by Article 100 of the Revised Penal Code, which states:

"ARTICLE 100. Civil liability of a person guilty of a felony. — Every person criminally liable for a felony is also civilly liable."

1. However, petitioner contends further that Article 2180 of the Civil Code shall govern and that it is independent from the subsidiary civil liability of the employer under Article 103 of the Revised Penal Code.

2. That the act of Torzuela is actionable under Article 33 of the New Civil Code:

"ARTICLE 33. In cases of defamation, fraud, and physical injuries, a civil action for damages, entirely separate and distinct from the criminal action, may be brought by the injured party. Such civil action shall proceed independently of the criminal prosecution, and shall require only a preponderance of evidence."

Issue: Whether or not the civil action is founded on quasi-delict and should the employer be held jointly liable for damages. Whether or not physical injuries include consummated homicide for Article 33 to apply in the case

Held: Yes to both issues. The SC ruled in favor of the petitioner. Well-entrenched is the doctrine that Article 2176 covers not only acts committed with negligence, but also acts which are voluntary and intentional.

Private respondents further aver that Article 33 of the New Civil Code applies only to injuries intentionally committed pursuant to the ruling in Marcia v. CA. However, the term " physical injuries" in Article 33 has already been construed to include bodily injuries causing death (Capuno v. Pepsi-Cola Bottling Co. of the Philippines). It is not the crime of physical injuries defined in the Revised Penal Code. It includes not only physical injuries but also consummated, frustrated, and attempted homicide

Intentional Tort (Abuse of Right)

Velayo v. Shell

100 Phil 186 (July 30, 1957)

Facts: Commercial Air Lines, Inc., referred to as CALI, is a corporation duly organized and existing in accordance with the Philippines laws, and previously engaged in air transportation business. The Shell Company of the P. I., Ltd., is a corporation organized under the laws of England and duly licensed to do business in the Philippines.

CALI’s operations needed fuel, thus it had a number of persons extending credit to said corporation. However, on August 1948, CALI had financial difficulties and had to call on an informal meeting of creditors because they were in the state of insolvency.

Soon thereafter, the big creditors present in the meeting discussed preferences of credit. The creditors present agreed to the formation of a working committee to continue to order of payment and to supervise the preservation of the properties of the corporation while they attempted to come to an understanding as a fair distribution of assets among them.

The committee consists of Mr. Fitzgerald, Mr. Agcaoili, and Atty. Sycip. Creditors agreed not to file a suit. However, on the day of the meeting of the working committee, they received a letter from Shell regarding its transfer of credit of CALI to the Shell Oil based in the US.

The American corporation, Shell, then sued CALI for the amount of the credit thus assigned. A writ of attachment was issued against a C-54 PLANE in Ontario International Airport.

And on January 5,1949, a judgment by default had been issued by the American court against CALI. The stockholders of CALI were unaware of this.

On December 17, 1948, Velayo filed for a writ of injunction to stop the foreign court from prosecuting the claim, and in the alternative, he prayed for damages in double the amount of the plane which was attached. The plaintiff having failed to restrain the progress of the attachment suit in the US by denial of the application of the writ of injunction and the consequences on execution of the C-54 plane in the state of California, USA, he confines his action to the recovery of damages against the defendant.

The complaint was dismissed, hence this petition.

Issues: Whether or not Shell acted in bad faith and betrayed the trust and confidence of the creditors of CALI. Whether or not by reason of betrayal of trust, Shell should be liable for damages.

Held: Yes. Chapter 2 of the preliminary title of the Civil Code on Human relations provides:

Article 19. Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith.

It is evident that Shell, upon learning the precarious economic situation of CALI and that will all probability, it could not get much of its outstanding credit because of the preferred claims of other creditors, entirely disregarded all moral inhibitory tenets.

The telegraphic transfer made without knowledge and at the back of other creditors of CALI may be a shrewd and surprise move that enabled Shell to collect almost all if not the entire amount of its credit, but the Supreme Court cannot countenance such attitude at all,and much less from a foreign corporation to thedetriment of Philippine Government and local business.

Shell’s transfer of credit would have been justified only if Fitzgerald had declined to take part in the working committee and frankly and honestly informed the other creditors present that he had no authority to bind his principal and that the latter was to be left free to collect its credit from CALI by whatever means his principal deemed wise and were available to it. But then, such information would have dissolved all attempts to come to an amicable conciliation and would have precipitated the filing of CALI’s voluntary insolvency proceedings and nullified the intended transfer of Shell’s credit to American Shell.

It may be said that article 19 only contains a mere declaration of principles and while such statement is essentially correct, yet We find that such declaration is implemented by Article 21 and the sequence of the same chapter, which prescribe the following:

Article 21. Any person who willfully causes loss or injury to another in manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage.

Saudi Arabia v. CA

297 SCRA 469 (October 8, 1998)

Facts: Private respondent Milagros Morada was a flight attendant of Petitioner Company. During a stop-over in Jakarta, she went to a disco with 2 of her fellow crew members Thamer and Allah (both surnamed Al-Gazzawi) and had breakfast in their hotel room. While there, Allah left and Thamer attempted to rape her.

She was saved by hotel security personnel who heard her cries for help. She later filed a case against them. The two were arrested and detained by Jakarta police. When Morada returned to Jeddah (the base of operations of petitioner), she was asked to go to Jakarta to arrange for the release of the two men. She proceeded to Jakarta but she refused to cooperate. She was eventually allowed to return to Jeddah but barred from Jakarta flights. The Indonesian authorities eventually deported the 2 men, through the intercession of the Saudi govt., after 2 weeks of detention. They were put back in service while respondent Morada was transferred to Manila.

Two years later, she was asked by her superiors to see Mr. Miniewy, the Chief Legal Officer of Saudi Air, in Jeddah. When they met, he brought her to the police station where her passport was taken and she was questioned about the Jakarta incident. Miniewy merely stood as the police put pressure on her to drop the case against the two men. Not until she agreed to do so did the police return her passport and allowed her to catch a later flight out of Jeddah.

A year and a half later, she was again asked to go to Jeddah to see Miniewy. When she did, a certain Khalid of Saudia brought her to a Saudi court where she was asked to sign a d ocument written in Arabic. She was told that it was necessary to close the case against Thamer and Allah. As it turned out, she signed a document to appear before the court a week later. When the date of appearance came, she complied but only after being assured by Saudia’s Manila manager that the investigation was a routine and posed no danger to her.

She was brought before the court and was interrogated by a Saudi judge and let go, however, just as she was about to board a plane home, she was told that she had been forbidden to take flight. She was later told to remain in Jeddah and her passport was again confiscated.

A few days later, she was again brought before the same court where the S audi judge, to her astonishment and shock, sentenced her to 5 months imprisonment and 286 lashes. Only then did she realize that the Saudi court had tried her, together with Thamer and Allah for what happened in Jakarta. The court found her guilty of adultery; going to a disco, dancing and listening to music in violation of Islamic laws; and socializing with the male crew, in contravention of Islamic tradition.

F acing conviction, she sought help from her employer, petitioner Saudi Arabian Air but she was denied assistance of any kind. She asked the Phil. Embassy to help her. Because she was wrongfully convicted, the Prince of Makkah dismissed the case against her and allowed her to leave Saudi Arabia. Shortly before her return to Manila, she was terminated from the service by Saudi Arabian Air without being informed of the cause.

She then filed a complaint for damages against Saudi Arabian Air and Mr. Al-Balawi, its country manager. Saudi Arabian Air filed a motion to dismiss raising the issues of lack of cause of action and lack of jurisdiction.

Issues: Whether or not Morada had a cause of action (2) Which law should govern, Phil. Law or Saudi Law?

Held: YES, she has a cause of action. She aptly predicated her cause of action on Art.19 and Art.21 of the CC. As held in PNB v CA, “the aforecited provisions on human relations were intended to expand the concept of torts in this jurisdiction by granting adequate legal remedy for the untold no. of moral wrongs which is impossible for human foresight to specifically provide in the statutes.”

Although Art.19 merely declares a principle of law, Art.21 gives flesh to its provisions.

She was the one made to face trial for very serious charges, including adultery and violation of Islamic laws and tradition. Saudi Arabian Air may have acted beyond its duties as employer in turning her over to Jeddah officials. Its purported act contributed to or even proximately caused additional humiliation, misery and suffering of private respondent, Morada. Saudi Air allegedly facilitated the arrest, detention and prosecution of Morada under the guise of petitioner’s authority as employer, taking advantage of the trust, confidence and faith she reposed upon it. As purportedly found by the Prince of Makkah, the alleged conviction and imprisonment of Morada was wrongful. But these capped the injury or harm allegedly inflicted upon her person and reputation, for which petitioner could be liable as claimed, to provide compensation or redress for the wrongs done, once duly proven.

2. Philippine Law should be applied. Choice of law rules invariably consist of a factual relationship (such as property right, contract claim) and a connecting factor or point of contact, such as the situs of the res, the place of celebration, the place of performance, or the place of wrongdoing.

Considering that the complaint in the court a quo is one involving torts, the “connecting factor” or “point of contact” could be the place or places where the tortious conduct or lex loci actus occurred. And applying the torts principle in a conflicts case, the SC finds that the Philippines could be said as a situs of the tort (the place where the alleged tortious conduct took place). This is because it is in the Philippines where petitioner allegedly deceived private respondent, a Filipina residing and working here.

The SC held what is important here is the place where the over-all harm or the totality of the alleged injury to the person, reputation, social standing and human rights o f complainant, had lodged according to the private respondent. All told, it is not without basis to identify the Philippines as the situs of the alleged tort.

The SC finds it necessary to apply the “State of the most significant relationship” rule, which should be appropriate to apply given the factual context of the case. In applying said principle to determine the State which has the most significant relationship, the following contacts are to be taken into account and evaluated according to their relative importance with respect to the particular issue:

(A) the place where the injury occurred;

(B) the place where the conduct causing the injury occurred;

(D) the place where the relationship, if any, between the parties is centered.

There is basis for the claim that the over-all injury occurred and lodged in the Philippines. Private respondent is a resident Filipina national, working with petitioner, a resident foreign corporation engaged in international air carriage business here. Thus, the “relationship” between the parties was centered here.

Globe Mackay v. CA

176 SCRA 778 (August 25, 1989)

Facts: Restituto M. Tobias, the private respondent, was employed by petitioner Globe Mackay Cable and Radio Corporation (GLOBE MACKAY) in a dual capacity as a purchasing agent and administrative assistant to the engineering operations manager. In 1972, GLOBE MACKAY discovered fictitious purchases and other fraudulent transactions for which it lost several thousands of pesos.

According to Tobias it was him who actually discovered the anomalies and reported them on November 10, 1972 to his immediate superior Eduardo T. Ferraren and to petitioner Herbert C. Hendry who was then the Executive Vice-President and General Manager of GLOBE MACKAY.

However, his superiors twisted the facts and alleged that it was Tobias who was their number one suspect. This led to the different investigations including a lie detector test to make Tobias admit something he did not do. He was later on dismissed by Globe Mackay. Unemployed, Tobias tried applying for a new job in RETELCO.

However, the petitioner, without being asked by RETELCO, wrote a letter to the latter stating that Tobias was dismissed by GLOBE MACKAY due to dishonesty. Tobias filed a civil case. The RTC awarded damages and the Court of Appeals affirmed said judgment.

Issue: Whether or not petitioners are liable for damages to private respondent.

Held: Yes. An employer who harbors suspicions that an employee has committed dishonesty might be justified in taking the appropriate action such as ordering an investigation and directing the employee to go on a leave. Firmness and the resolve to uncover the truth would also be expected from such employer. But the high-handed treatment accorded Tobias by petitioners was certainly uncalled for.

Petitioners contend that they could not be made liable for damages in the lawful exercise of their right to dismiss private respondent. This does not, however, leave private respondent with no relief because Article 21 of the Civil Code provides that:

Art. 21. Any person who wilfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage.

Several other tortious acts were committed by petitioners against Tobias after the latter's termination from work. The damage incurred by Tobias was not only in connection with the abusive manner in which he was dismissed but was also the result of several other quasi-delictual acts committed by petitioners such as the filing of six criminal complaints which amount to malicious prosecution.

Albenson v. CA

G.R. No. 88694 (January 11, 1993)

Facts: Albenson Enterprises delivered to Guaranteed Industries mild steel plates and as payment, it was paid with a check amounting to P2,575 drawn against the account of E.L Woodworks.

The check was dishonored, Albenson, traced the origin of the check. The result from the SEC shows that the president of Guaranteed Industries and the owner of E.L Woodworks were one and the same with the name of Eugenio S. Baltao. Albenson made extrajudicial demand but Eugenio Baltao denied that he issued a check, urging the petitioner to file a complaint through Fiscal Sumaway for violation of BP 22.

Fiscal Sumaway claimed that he had given Eugenio S. Baltao opportunity to submit controverting evidence, but the latter failed to do so and therefore, was deemed to have waived his right.

Respondent Baltao, claiming ignorance of the complaint against him, immediately filed with the Provincial Fiscal of Rizal a motion for reinvestigation, alleging that it was not true that he had been given an opportunity to be heard in the preliminary investigation conducted by Fiscal Sumaway, and that he never had any dealings with Albenson.

The complaint of Albenson was dismissed and Baltao’s complaint was given merit and the RTC ruled in favor of him.

Issue: Whether or not Eugene Baltao is entitled to such damages for abuse of rights and malicious prosecution.

Held: No, the SC found no cogent reason to award such damages in favor of Eugene Baltao.

Article 19, known to contain what is commonly referred to as the principle of abuse of rights, sets certain standards which may be observed not only in the exercise of one's rights but also in the performance of one's duties. These standards are the following: to act with justice; to give everyone his due; and to observe honesty and good faith.

The law, therefore, recognizes the primordial limitation on all rights: that in their exercise, the norms of human conduct set forth in Article 19 must be observed. A right, though by itself legal because recognized or granted by law as such, may nevertheless become the source of some illegality. When a right is exercised in a manner which does not conform with norms enshrined in Article 19 and results in damage to another, a legal wrong is thereby committed for which the wrongdoer must be held responsible "

What prompted petitioners to file the case for violation of Batas Pambansa Bilang 22 against private respondent was their failure to collect the amount of P2,575.00 due on a bounced check which they honestly believed was issued to them by private respondent.

It appears however, that there was a mistake in identity as there were three (3) men having the name Eugenio Baltao that were all doing business in the building where E.L Woodworks was situated. It was most probably the son, Eugene Baltao III who issued the check to Albenson, which Mr. Eugene Baltao never during the investigation.

The mere act of submitting a case to the authorities for prosecution does not make one liable for malicious prosecution. An award of damages and attorney's fees is unwarranted where the action was filed in good faith. If damage results from a person's exercising his legal rights, it is damnum absque injuria.

Nor is he entitled to compensatory damages because he did not present proof of the cost of the medical treatment which he claimed to have undergone as a result of the nervous breakdown he suffered, nor did he present proof of the actual loss to his business caused by the unjust litigation against him. In determining actual damages, the court cannot rely on speculation, conjectures or guesswork as to the amount. Without the actual proof of loss, the award of actual damages becomes erroneous.

There is no evidence of the other party having acted in wanton, fraudulent or reckless, or oppressive manner, neither may exemplary damages be awarded (Dee Hua Liong Electrical Equipment Corporation vs. Reyes, 145 SCRA 488 [1986]).The award of attorney's fees must be disallowed where the award of exemplary damages is eliminated (Article 2208, Civil Code; Agustin vs. Court of Appeals, 186 SCRA 375 [1990]). Moreover, there was no malicious prosecution against private respondent, attorney's fees cannot be awarded him on that ground.

Amonoy v. Gutierrez

351 SCRA 731 (2001)

Facts: The house of spouses Gutierrez was situated in a lot foreclosed and bought by Sergio Amonoy. In April and May 1986, an Order of Demolition of the house was issued by the trial court but was enjoined by a temporary restraining order (TRO) granted to respondents on June 2, 1986.

In 1988, the TRO was made permanent by the Court, but the house of respondents had already been destroyed. The Court of Appeals held petitioner liable to respondents for P250,000.00 for actual damages thereof.

Hence, the appeal to the SC where petitioner asserted the principle of damnum absque injuria.

Issue: Whether or not the Court of Appeals was correct in deciding that the Amonoy was liable to the respondents for damages

Held: Yes. Amonoy invokes the principle of damnun absque injuria, the maxim that damage resulting from the legitimate exercise of a person's rights is a loss without injury for which the law gives no remedy. In other words, one who merely exercises one's rights does no actionable injury and cannot be held liable for damages.

The SC finds damnum absque injuria not applicable to this case. Amonoy did not heed to the TRO issued by the Court. He was already in bad faith when he continued the demolition despite the issuance of a TRO. The demolition of respondents' house by petitioner, despite his receipt of the TRO, was not only an abuse but also an unlawful exercise of such right.

Amonoy’s liability is premised on the obligation to repair or to make whole the damage caused to another by reason of one's act or omission, whether done intentionally or negligently and whether or not punishable by law.

UE v. Jader

G.R. No. 132344 (2000)

Facts: Romeo Jader, a law student enrolled in the University of the East, failed to take the regular final examination in Practice Court I for which he was given an incomplete grade in the 1st semester of his last year (1987-1988). After completing his 2nd semester, Jader filed an application for the removal of the incomplete grade given him by Professor Carlos Ortega. This was approved by Dean Celedonio Tiongson after paying the required fee. He took the examination, and on May 30, 1988, Professor Carlos Ortega submitted his grade, a five (5).

Deliberations were held, with Jader’s name appearing in the tentative list of candidates for graduation, but annotated with his deficiencies. Invitations were also made, with Jader’s name appearing as one of the candidates, albeit annotated as to the tentative nature of the list. Jader attended the said graduation ceremony, vested with all the rites symbolic of his graduation from law school. Believing he had successfully graduated, he took a leave of absence without pay to prepare for the bar examination. Upon his enrollment in the pre-bar review of the Far Eastern University, however, Jader learned of his deficiency, dropped out of the same and ultimately did not take the bar examination.

Jader sued UE for damages for suffering moral shock, mental anguish, serious anxiety, besmirched reputation, wounded feelings and sleepless nights arising from the latter’s negligence. Awards of moral and exemplary damages, unrealized income, attorney’s fees, and costs of suit were also prayed for.

UE denied liability, arguing that it never led Jader to believe that he completed the requirements for a Law degree when his name was included in the tentative list of graduating students. Trial ensued, with the lower court ruling in favor of Jader, ordering UE to pay 35,470 with legal rate of interest, and 5,000 for attorney’s fees and cost of suit. This was modified by the CA to the effect of requiring UE to pay Jader an additional 50,000 for moral damages.

Issue: Is UE liable to Romeo Jader, despite the former’s allegation that the proximate and immediate cause of the alleged damages incurred arose out of his own negligence in not verifying the result of his removal exam?

Held: UE is still liable to respondent Jader. In a contract of education, since the contracting parties are the school and the student, the latter is not duty-bound to deal with the formers agents, although nothing prevents either professors or students from sharing with each other such information. It is the contractual obligation of the school to timely inform and furnish sufficient notice and information to each and every student as to whether he or she had already complied with all the requirements for the conferment of a degree or whether they would be included among those who will graduate.

In belatedly informing Jader, UE cannot be said to have acted in good faith. Absence of good faith must be sufficiently established for a successful prosecution by the aggrieved party in a suit for abuse of right under Article 19 of the Civil Code. It connotes an honest intention to abstain from taking undue advantage of another, even though the forms and technicalities of the law, together with the absence of all information or belief of facts, would render the transaction unconscientious.

The school exercises general supervision and exclusive control over the professors with respect to the submission of reports involving the students standing, with “exclusive control” meaning that no other person or entity had any control over the instrumentality which caused the damage or injury.

Being a university engaged in legal education, it should have practiced what it inculcates in its students, specifically the principle of good dealings in Articles 19 and 20 of the Civil Code, the former provision intended to expand the concept of torts by granting adequate legal remedy for the untold number of moral wrongs, impossible for human foresight to provide specifically in statutory law.

UE failed to act seasonably and cannot feign ignorance that Jader will not prepare himself for the bar exams, since that is precisely the immediate concern after graduation of an LL.B. graduate. Liability arose from its failure to promptly inform him of the exam results and in misleading the latter into believing that he had satisfied all course requirements.

While UE was guilty of negligence and liable to Jader for actual damages, he should not have been awarded moral damages. At the very least, it behooved on Jader to verify whether he has completed all necessary requirements to be eligible for the bar examinations. As a senior law student, he should have been responsible enough to ensure that all his affairs were in order. The Court fails to see how he could have suffered untold embarrassment in attending the graduation rites, enrolling in the bar review classes and not being able to take the bar exams. If Jader was indeed humiliated, he brought this upon himself by not verifying all the requirements including his school records, before preparing himself for the bar examination.

Facts: Esteria Garciano was hired to teach during the 1981-82 school year in the Immaculate Concepcion Institute in the Island of Camotes. Before the school year ended, she applied for

an indefinite LOA because her daughter was taking her to Austria, her daughter’s place of employment. The application was recommended for approval by the school principal, Emerito

O. Labajo, and approved by the President of the school's Board of Directors. On June 1, 1982, Emerito Labajo addressed a letter to the Garciano, stating that by way of the decision of school founder, Fr. Joseph Wiertz, the president of the PTA and the school faculty, they have decided to terminate her services due to: a) absence of a written contract of employment due to Garciano’s refusal to sign one, and b) the difficulty of getting a substitute for her on a temporary basis as no one would accept the position without a written contract. Upon Garciano’s arrival from Austria, and after several inquiries about the matter, the Board of Directors without the consent of the school founder signed a letter, reinstating Garciano to her former position, with a statement declaring the previous communication received had been declared null and void for not bearing the sanction or authority of the Board. Subsequently, the president, vice president, secretary, and three members of the Board of Directors resigned from their positions "for the reason that the ICI Faculty, has reacted acidly to the Board's deliberations for the reinstatement of Garciano.

A complaint for damages was filed in the RTC-Cebu against Fr. Wiertz, Emerito Labajo, and some members of the faculty of the school for discrimination and unjust and illegal dismissal. After trial, the lower court ruled in favor of Garciano, ordering Wiertz and Co. to pay 200,000 as moral damages, 50,000 exemplary damages, 32,400 as lost earnings for 9 years and 10,000 as litigation and attorney’s fees. On appeal, the Appellate Court reversed the ruling of the lower court, dismissing the complaint and absolving Wiertz and Co. Following the denial of their motion for reconsideration, Garciano seeks redress in the High Court.

Issues: Did the CA err in absolving Wiertz and Co. from liability by faulting Esteria Garciano for her failure to report back to work? Should they be held liable for damages?

Held: The High Court ruled in the negative. It held that the board of directors of the Immaculate Concepcion Institute, which possesses the authority to hire and fire teachers and other employees of the school, did not dismiss the Garciano, but merely directed her to report for work. While the Wiertz and Co. sent her a letter of termination through her husband, as discovered by the CA, Wiertz and Co. were aware of their lack of authority to do so. The letter of termination they sent to Garciano through her husband had no legal effect, and did not prevent her from reporting for work. There was no reason why she could not continue with her teaching in the school.

No evidence had been presented to show that defendants-appellants prevented her from reporting for work. An acidic reaction made by Wiertz and Co. can be seen as nothing more than a reaction to what they perceived as an affront to their collective prestige. It would appear, therefore, that plaintiff-appellee voluntarily desisted from her teaching job in the school and has no right to recover damages from defendants-appellants. They actually did nothing to physically prevent her from reassuming her post, as ordered by the school's Board of Directors

With regard to damages, liability under Articles 19, 20 and 21 of the Civil Code arises only from unlawful, willful or negligent acts that are contrary to law, or morals, good customs or public policy.

Given that Garciano's discontinuance from teaching was her own choice, whatever loss she may have incurred in the form of lost earnings was self-inflicted. Volenti non fit injuria. With respect to Garciano's claim for moral damages, since the right to recover them under Article 21 is based on equity, he who comes to court to demand equity must come with clean hands. In this case, Garciano is not without fault. Her indefinite leave of absence, followed by her failure to report in time for the opening of classes, as well as her refusal to sign a written contract of employment and her ignorance of the Board’s order to return to work are reflections of her fault.

Barons vs. CA

G.R. No. 126486 (1998)

Facts: Phelps Dodge, Philippines, Inc. (PDPI), appointed Barons Marketing, Corporation (BMC) as one of its dealers of electrical wires and cables. The latter was given 60 days credit for its purchases of plaintiff's electrical products, to be reckoned from the date of delivery by Phelps Dodge of its products.

For the period covering December 1986 to August 17, 1987, BMC purchased, on credit, from PDPI various electrical wires and cables in the total amount of P4,102,438.30, which were subsequently sold to MERALCO. Sales invoices issued by PDPI to BMC stipulate a 12% interest on the amount due for attorney’s fees and collection. On September 7, 1987, defendant paid plaintiff the amount of P300,000.00 out of its total purchases, leaving an unpaid account on the aforesaid deliveries of P3,802,478.20. Demand for payment was

made several times by PDPI, which was responded to by BMC with a request that it be able to pay its obligation in monthly installments of 500,000 at 1% interest per annum. The offer was rejected by PDPI, who reiterated its demand for full payment.

A complaint was filed by PDPI before the Pasig RTC against BMC for the recovery of the unpaid balance for made deliveries worth 3,108,000, as well as interest, exemplary damages of at least 100,000, the cost of the suit, as well as attorney’s fees at the rate of 25% of the amount demanded. In response, BMC, although admitting that the said purchases were theirs, disputed the amount claimed by PDPI, asserting that the acts were perpetrated to induce humiliation and in abuse of PDPI’s rights.

After trial, judgment was rendered in favor of PDPI, ordering BMC to pay for the unpaid balance of their purchases at 12% interest per annum, attorney’s fees at 25% of the preceding obligation, exemplary damages worth 10,000 and the cost of the suit.

On appeal, the judgment was modified to adopt the original amount of unpaid deliveries (3,802,478.20) at 12% per annum and 5% of the said obligation as attorney’s fees.

Issue/s: Is PDPI guilty of abuse of right? If not, can PDPI recover interest and attorney’s fees?

Held: The Court held that BMC’s theory that PDPI abused its rights by rejecting the former’s offer of settlement, subsequently followed by the filing of the present complaint was untenable. To invoke Article 19 of the Civil Code, the defendant must act with bad faith or intent to prejudice the plaintiff. Quoting Tolentino, abuse of right exists “when it is exercised for the only purpose of prejudicing or injuring another.“

Given this premise, the Courts held that PDPI’s act of rejecting BMC’s offer to settle was not made to prejudice or injure BMC. It is also a fundamental rule that good faith is

presumed and that the burden of proving bad faith rests upon the party alleging the same. BMC, in this case, has failed to prove the bad faith of PDPI. On the contrary, the Court finds the reasons of PDPI to be legitimate. As pointed out, the corporation had its own "cash position to protect in order for it to pay its own obligations."

With this in mind, BMC’s prayer for moral and exemplary damages must also be rejected, in lieu of Article 2219 (10).

As to the second issue, the Court ruled that the stipulation provided constitutes a penal clause, and thus, BMC is required to pay interest, attorney’s fees and collection fees. However, given the power of the courts to reduce the penalty whenever it is found to be iniquitous or unconscionable, the Court believes that 10% of the principal amount is adequate to cover both attorney’s and collection fees.

BPI vs. CA

G.R. No. 120639 (1998)

Facts: Ricardo Marasigan, a lawyer by profession, was a complimentary member of the BPI Express Card Corporation (BECC) from February 1988 to February 1989. Said corporation issued him Credit Card No. 1 00-012-5534 with a credit limit of P3,000.00. Said membership to BECC was renewed until February 1990 at an increased credit limit of P5,000.00. The contention arose when Marasigan failed to timely pay his account for October 1989 amounting to P8,987.84. Through Marasigan’s secretary, BECC informed him that they are demanding immediate payment of his balance, the deposit of a P15,000.00 to cover his future bills, and threatened to suspend his credit card. A postdated check was issued by Marasigan from the Far East Bank and Trust, Co. and was received by BECC’s co-employees on November 23, 1989. The same was forwarded to the collection department a week later. 5 days after receipt, BECC served Marasigan a letter informing him of the temporary suspension of his credit card privileges and the inclusion of his account number in their Caution List. He was also told to refrain from further use of his credit card to avoid any inconvenience/embarrassment and that his membership will be permanently cancelled unless he settles his outstanding account with the defendant within 5 days from receipt of the letter. Marasigan, however, did not receive the letter before December 8, 1989, the day wherein he entertained several guests at Café Adriatico. Upon presentment of his credit card to foot the bill of P735.32, said card was dishonored. One of his guests, Mary Ellen Ringler, paid the bill by using her own credit card.

Correspondence was sent out by Marasigan, seeking that he be sent the exact bill due him as of December 15, 1989, to withhold the deposit of his postdated check, and return the same due to his instruction to stop payment. No reply was given by BECC, prompting Marasigan to send another letter reminding the BECC that he had long cancelled whatever arrangement he entered into with the Corporation and requested for his correct billing, less improper charges and penalties, and for an explanation within 5 days from receipt thereof why his card was dishonored on December 8, 1989 despite assurance by defendant's personnel-in-charge, otherwise court action shall be filed to hold defendant responsible for the humiliation and embarrassment suffered by him. In turn, final demand was sent to Marasigan dated March 21, 1990 requiring him to pay in full his overdue account, including stipulated fees and charges, within 5 days from receipt thereof or face court action, as well as replace the postdated check with cash within the same period or face criminal suit for violation of the B.P. 22. Marasigan, in turn, demanded BECC’s compliance with his earlier request, or face court action.

A complaint for damages against BECC was filed before the Makati RTC. After trial, the lower court ruled in favor of Marasigan, finding BECC had abused its right in contravention of Article 19 of the Civil Code. It ordered BECC to pay a) 100,000 as moral damages, b) 50,000 as exemplary damages and c) 20,000 as attorney’s fees. On the other hand, the lower court ordered Marasigan to pay for his outstanding obligation worth 14,439.41.

On appeal, the decision was affirmed but modified, ordering BECC to pay a) 50,000 as moral damages, b) 25,000 as exemplary damages and c) 10,000 as attorney’s fees.

Issue: In canceling Marasigan’s credit card, did BECC abuse his right under the terms and conditions of their contract?

Held: BECC did not abuse its right. To find the existence of an abuse of right under Article 19 the following elements must be present: (1) There is a legal right or duty; (2) which is exercised in bad faith; (3) for the sole intent of prejudicing or injuring another.

The Court went on to distinguish damage, damages and injury, the latter being an illegal invasion of a legal right, damage is the loss, hurt, or harm which results from the injury, while damages are the recompense or compensation awarded for the damage suffered.

In order to maintain an action for the injury, one must establish that such injuries resulted from a breach of duty which a defendant owed to a plaintiff - a concurrence of injury to the plaintiff and legal responsibility by the person causing it. The underlying basis for the award of tort damages is the premise that an individual was injured in contemplation of law. Thus, there must first be a breach of some duty and the imposition of liability for that breach before damages may be awarded; and the breach of such duty should be the proximate cause of the injury.

Acts Contra Bonus Mora

Ruiz v. Secretary of National Defense

G.R. No. L-15526 (1963)

Facts: Allied Technologists, Inc. (ATI) and the Republic of the Philippines entered into a contract for the construction of the Veterans Memorial Hospital in September 11, 1950. Ruiz and Herrera were stockholders of ATI. The construction of the said hospital was halted in 1955, followed by the filing of 2 civil cases in succession by Ruiz and Herrera against ATI, the Secretary of National Defense, Col. Nicolas Jimenez, the head of the Engineering Group of the DND and Pablo Panlilio, as Auditor of the DND.

The first case (CC No. 23778) was dismissed by the CFI on October 12, 1954 as affirmed by the high Court on July 7, 1955. Civil Case No. 26601 was also dismissed on September 13, 1955. On appeal, the high Court reversed the order of dismissal, under the impression that the real controversy was confined merely between Panlilio, Ruiz and Herrera over the 15% of the contract price, which was retained by the DND, which was originally made to answer for any claim or lien that might arise, in the course of the construction. Civil Case No. 26601 was remanded to its court of origin for further proceedings.

Panlilio and ATI filed their amended answers, stating that the amount retained by the DND was already paid to ATI, as sought for by the Ruiz and Herrera in their complaint. In view of this development, the trial court invited the parties to a conference, in which the Ruiz and Herrera indicated their conformity, to the dismissal of the complaint with respect to the retention of the 15% of the contract price; but insisted upon the hearing of the second question, which sought the declaration and recognition of Ruiz and Herrera, as two of the three architects of the hospital. The trial court dismissed the complaint, for being moot and academic.

Issue: Did the lower court err in ordering the dismissal of the case?

Held: The trial court made no error. Ruiz and Herrera contend that the only ground relied upon by the trial court to dismiss the case without trial is the allegation that the amount retained by the DND had already been paid, yet except for this bare allegation, no evidence was adduced to prove the truth of the same. Even assuming, for the sake of argument, that the same is true, nevertheless the first part of the first cause of action still remains, for which they had insisted upon a hearing to establish their right to be recognized as two of the three architects of the hospital; that because the pleadings do not show any ground which might legally justify the action taken by the lower court, the latter should not have ordered the dismissal of the entire case but should have ordered only the striking out of the moot portion of appellants' first cause of action, based upon Article 21 of the Civil Code.

This cannot be given merit. As found by the trial court, Ruiz and Herrera’s first cause of action is composed of: a) judicial declaration or recognition that Ruiz and Herrera, together with Panlilio, were the architects of the Veterans Hospital; and b) injunction restraining government officials paying Panlilio the sum retained, as per stipulation contained in the contract.

By discarding the Secretary and other officials of the DND, as defendants, Ruiz and Herrera could not expect the trial court to order them to recognize and declare them co-architects in the construction of the hospital. And, as the amount retained by the Department on the contract price, which retention was authorized by the contract, was, as sought by the appellants, already paid to the ATI, there is nothing more for the trial court to decide, even without first ruling on the special defenses of Panlilio and ATI.

Ruiz and Herrera’s reliance on Article 21 of the Civil Code is unfounded. They contend that the word "injury" in the said article, refers not only to any indeterminate right or property, but also to honor or credit. However, although this article envisions a situation where a person has a legal right which is violated by another in a manner contrary to morals, good customs or public policy, it presupposes loss or injury, material or otherwise, which one may suffer as a result of said violation. The pleadings do not show that damages were ever asked in connection with this case, predicated upon the said article. Under the facts and circumstances in this case, one cannot plausibly sustain the contention that the failure or refusal to extend the recognition was an act contrary to morals, good customs or public policy.

Breach of promise to marry, seduction and sexual assault

Wassmer vs. Velez

G.R. No. L-20089 (1964)

Facts: Francisco X. Velez and Beatriz P. Wassmer, following their mutual promise of love, decided to get married and set September 4, 1954 as the big day. On September 2, 1954 Velez left Wassmer with a note stating that the wedding must be postponed, as Velez’s mother opposes it. He also asked Wassmer not to fuss. The following day, however, Velez sent Wassmer another telegram, stating that nothing has changed, and he shall return very soon. Velez was never seen by Wassmer nor heard from again after that.

Wassmer filed a suit for damages against Velez. Velez filed no answer and was declared in default. Judgment was rendered in favor of Wassmer, ordering Velez to pay P2,000.00 as actual damages; P25,000.00 as moral and exemplary damages; P2,500.00 as attorney's fees; and the costs of the suit. Velez filed a petition for relief from orders, judgment and proceedings and motion for new trial and reconsideration. Plaintiff moved to strike it out, but the Court ordered the parties to explore at this stage of the proceedings the possibility of arriving at an amicable settlement.

Following a series of failed attempts to amicably settle the matter, the court issued an order denying defendant's aforesaid petition. Hence, Velez’s appeal to the high Court. In support of his "motion for new trial and reconsideration," defendant asserts that the judgment is contrary to law. The reason given is that "there is no provision of the Civil Code authorizing" an action for breach of promise to marry. As stated in Hermosisima vs. Court of Appeals, “…a mere breach of a promise to marry is not an actionable wrong.”

Issue: Should the lower court’s decision be set aside, removing Wassmer’s right to claim damages?

Held: The lower court’s decision must be affirmed, as what was done by the high Court in this case. The extent to which acts not contrary to law may be perpetrated with impunity, is not limitless for Article 21 of said Code provides that "any person who willfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage."

The record reveals that Wassmer and Velez applied for a license to contract marriage, set a wedding day for September 4, 1954, Printed and distributed wedding invitations to relatives, friends and acquaintances, purchased dresses and other apparel for the important occasion and the like. And then, with but two days before the wedding, Velez simply left.

Surely this is not a case of mere breach of promise to marry. As stated, mere breach of promise to marry is not an actionable wrong. But to formally set a wedding and go through all the above-described preparation and publicity, only to walk out of it when the matrimony is about to be solemnized, is quite different. This is palpably and unjustifiably contrary to good customs for which defendant must be held answerable in damages in accordance with Article 21 aforesaid.

Velez also contends that the moral damages awarded were excessive, and should be totally eliminated. This argument, however is devoid of merit. Under the above-narrated circumstances of this case defendant clearly acted in a "wanton, reckless and oppressive manner." The high Court's opinion, however, is that considering the particular circumstances of this case, P15,000.00 as moral and exemplary damages is deemed to be a reasonable award.

TANJANCO vs. SANTOS

G.R. No. L-18630 (1966)

Facts: Apolonio Tanjanco courted Araceli Santos, the former expressing and professing his undying love and affection for her who also, in due time reciprocated the tender feelings. In consideration of Tanjanco’s promise to marry Santos, she consented to Tanjanco’s pleas for carnal knowledge, as a result of which Santos conceived a child. To avoid embarrassment and social humiliation due to her pregnancy, Santos resigned from her job in IBM, Philippines as a secretary, thereby unable to support herself and her baby. Tanjanco, on the other hand, refused to marry Santos, as well as recognize their unborn child, prompting her to file suit to compel Tanjanco to recognize the unborn child she was bearing, to give her support of not less than P430.00 a month, plus P100,000.00 in moral and exemplary damages and P10,000.00 attorney's fees. Tanjanco, in turn, filed a motion to dismiss.

The lower court dismissed the complaint for failure to state a cause of action. On appeal, the CA held that no cause of action was shown to compel recognition of a child as yet unborn, nor for its support, but decreed that the complaint did state a cause of action for damages, premised on Article 21 of the Civil Code. It set aside the lower court’s decision and directed the same to proceed with the case. This prompted Tanjanco to appeal to the high Court.

Issue: Is Tanjanco correct in pleading that actions for breach of a promise to marry are not permissible in this jurisdiction?

Held: The Court ruled in the affirmative. The Appellate court erred by relying upon a memorandum submitted by the Code Commission to the Legislature in 1949 to support the original draft of the Civil Code, which provided this example:

"A" seduces the nineteen-year old daughter of "X". A promise of marriage either has not been made, or cannot be proved. The girl becomes pregnant. Under the present laws, there is no crime, as the girl is above eighteen years of age. Neither can any civil action for breach of promise of marriage be filed. Therefore, though the grievous moral wrong has been committed, and though the girl and her family have suffered incalculable moral damage, she and her parents cannot bring any action for damages. But under the proposed article (now Article 21), she and her parents would have such a right of action.

Indeed, the CA overlooked the fact that the memorandum referred to a tort upon a minor who has been seduced, which connotes essentially the idea of deceit, enticement, superior power or abuse of confidence on the part of the seducer to which the woman has yielded.

Given the circumstances of this case, the facts stand out that for one whole year, from 1958 to 1959, Santos, a woman of adult age, maintained intimate sexual relations with Tanjanco with repeated acts of intercourse. Such conduct is incompatible with the idea of seduction. There is voluntariness and mutual passion in this case, for had the she been deceived, had she surrendered exclusively because of the deceit, artful persuasions and wiles of the Tanjanco, she would not have again yielded to his embraces, much less for one year, without exacting early fulfillment of the alleged promises of marriage, and would have cut all sexual relations upon finding that defendant did not intend to fulfill his promises. Hence, we

conclude that no case is made under Article 21 of the Civil Code, and no other cause of action being alleged, no error was committed by the Court of First Instance in dismissing the complaint.

The dismissal, however, must be understood to be without prejudice to whatever actions may correspond to the child of Tanjanco. On that point, this Court makes no pronouncement, since the child's own rights are not here involved.

Bunag vs. CA

G.R. No. 101749 (1992)

Facts: Conrado Bunag, Jr. and Zenaida Cirilo, after reaching a hotel/motel and having sexual intercourse, went to Pamplona in Las Piñas, where they lived together as husband and wife for 21 days, even filing an application for a marriage license in Cavite. Bunag, Jr., however, withdrew the application on October 1, 1973.

Cirilo’s version of the case recites that she and Bunag were lovers. She also states was brought to the hotel/motel against her will where Bunag succeeded in raping her, and that thereafter, she was allowed to go home only after they were married. They then went to Bunag’s grandmother’s house in Las Piñas where they lived as husband and wife, but on September 29, 1973, Bunag left and never returned, bringing Cirilo humiliation and shame because of Bunag’s deception. This was corroborated by Cirilo’s uncle, Vivencio, who added that Bunag’s father, Bunag, Sr. wanted to settle things and have the couple wed.

Bunag, Jr., on the other hand, insists that he did not rape Cirilo. In fact, he and Cirilo had plans to elope and get married. However, due to bitter disagreements over money and threats to his person, Bunag, Jr. broke off the engagement.

A complaint for damages was filed by Cirilo for Bunag, Jr.’s broken promise of marriage. In finding that Bunag, Jr. had forcibly abducted and raped Cirilo, the trial court ruled for Cirilo ordering Bunag, Jr. to pay P80,000.00 as moral damages, P20,000.00 as exemplary damages, P20,000.00 by way of temperate damages, and P10,000.00 for and as attorney's fees, as well as the costs of suit. Conrado Bunag, Sr. was absolved from any and all liability. On appeal, the CA ruled to affirm the decision of the lower court. Hence, this petition for review.

Issue: Is Bunag, Jr. correct in asserting that since the action involved breach of promise to marry, the trial court erred in awarding damages?

Held: The high Court held that while it is true that in this jurisdiction, the time-honored rule that an action for breach of promise to marry has no standing in the civil law, apart from the right to recover money or property advanced by the plaintiff upon the faith of such promise.

The award of moral damages is allowed in cases specified in or analogous to those provided in Article 2219 of the Civil Code. Correlatively, under Article 21 of said Code, in relation to Article 2219 (10), any person who willfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for moral damages. Article 21 was adopted to remedy the countless gaps in the statutes which leave so many victims of moral wrongs helpless even though they have actually suffered material and moral injury, and is intended to vouchsafe adequate legal remedy for that untold number of moral wrongs which is impossible for human foresight to specifically provide for in the statutes.

Under the prevailing circumstances, the acts of Bunag, Jr. in forcibly abducting Cirilo and having carnal knowledge with her against her will, and thereafter promising to marry her in order to escape criminal liability, only to renege on such promise after cohabiting with her for twenty-one days, constitute acts contrary to morals and good customs. These are grossly insensate and reprehensible transgressions which justify the award of moral and exemplary damages, pursuant to Article 21 in relation to paragraphs 3 and 10, Article 2219, and Article 2229 and 2234 of Civil Code. Further, the dismissal of the criminal case against Bunag, Jr. for rape did not carry with it the extinction of the civil action.

Constantino vs. Mendez

G.R. No. 57227 (1992)

Facts: Amelita Constantino worked as a waitress at Tony’s Restaurant in Sta. Cruz, Manila. It was here where she met Ivan Mendez. Following their first meeting, Mendez invited her to dinner at the Hotel Enrico. While dining, Mendez professed his love for Constantino. Constantino asked to be brought home, to which Mendez agreed, on the pretext of getting something in return. Promising to marry her, Mendez succeeded in having sexual intercourse with Constantino, then after confessing that he was a married man. This continued on to the months of September and November. Constantino eventually got pregnant, and asked for help from Mendez to support the child, but this plea fell on deaf ears. Constantino was forced to leave her work as a waitress, as a result. This prompted Constantino to file for acknowledgment, support and the payment of actual, moral and exemplary damages. In response, Mendez denied having sexual relations with Constantino and prayed for the dismissal of the case. He further prayed for the payment of exemplary damages and litigation expense including attorney's fees for the filing of the malicious complaint.

The lower court ruled in favor of Constantino, ordering Mendez to pay P8,000.00 by way of actual and moral damages; and P3,000.00, as and by way of attorney's fees, as well as the costs of the suit. Both parties filed a motion for reconsideration, with the trial court finding merit in Constantino’s motion, amending its decision by ordering Mendez to pay for actual and moral damages, hospital expenses of P200.00, permanent monthly support of P300.00, P5,000.00 as attorney’s fees, and to recognize Michael Constantino as the illegitimate son of Ivan Mendez. On appeal, the CA dismissed the amended decision.

Issue: Is Amelita Constantino entitled to damages in this case?

Held: The high Court ruled in the negative. Amelita's claim for damages, which is based on Articles 19 and 21 of the Civil Code, sits on the theory that through Ivan's promise of marriage, she surrendered her virginity. The high Court, however, agrees with the Court of Appeals that mere sexual intercourse is not by itself a basis for recovery of damages. Damages could only be awarded if sexual intercourse was not a product of voluntariness and mutual desire.

At the time Amelita met Ivan at Tony's Restaurant, she was already 28 years old and admitted that she was attracted to Ivan. Her attraction is the reason why she surrendered her womanhood. Had she been induced or deceived because of a promise of marriage, she could have immediately severed her relation with Ivan when she was informed after their first sexual contact sometime in August, 1974, that he was a married man. Her declaration that in the months of September, October and November, 1974, they repeated their sexual intercourse only indicates that passion and not the alleged promise of marriage was the moving force that made her submit herself to Ivan.

Quimiguing vs. Icao

G.R. No. 26795 (1970)

Facts: Carmen Quimiguing, assisted by her parents, sued Felix Icao. The parties were neighbors in Dapitan City, and had close and confidential relations. Icao, although married, succeeded in having carnal intercourse with Quimiguing several times by force and intimidation, and without her consent. As a result, she became pregnant, despite efforts and drugs supplied by Icao, forcing her had to stop studying. Hence, she now claims support at P120.00 per month, damages and attorney's fees. Icao, on the other hand, moved to dismiss for lack of cause of action since the complaint did not allege that the child had been born. After hearing arguments, the trial judge sustained defendant's motion and dismissed the complaint. Quimiguing moved to amend the complaint to allege that as a result of the intercourse, plaintiff had later given birth to a baby girl; but the court, sustaining Icao's objection, ruled that no amendment was allowable, since the original complaint averred no cause of action. Hence the appeal directly to this Court.

Issue: Was the trial court correct in sustaining Icao’s motion?

Held: The high Court ruled in the negative. A conceived child, although as yet unborn, is given by law a provisional personality of its own for all purposes favorable to it, as explicitly provided in Article 40 of the Civil Code. Therefore, an unborn child has a right to receive support from its progenitors, even if the said child is only "en ventre de sa mere."

Further, for a married man to force a woman not his wife to yield to his lust (as averred in the original complaint in this case) constitutes a clear violation of the rights of his victim that entitles her to claim compensation for the damage caused, as mandated by Article 21 of the Civil Code, in relation to Article 2219 (3,10).

Hence, Quimiguing herself had a cause of action for damages under the terms of her complaint, and the dismissal of the same constitutes an error on the part of the lower court.

Pe vs. Pe

G.R. No. L-17396 (1962)

Facts: The case originates from the parents, brothers and sisters of one Lolita Pe, who had gone missing on April 14, 1957 and at that time, was a single, 24 year old woman. Sometime in 1952, Alfonso frequented the house of Lolita on the pretext that he wanted her to teach him how to pray the rosary. The two eventually fell in love with each other and conducted clandestine trysts not only in the town of Gasan but also in Boac where Lolita used to teach in a barrio school. Eventually, Lolita’s parents found out and forbade Alfonso from going to their house and from further seeing Lolita.

Sometime in April, 1957, Lolita was staying with her brothers and sisters at their residence at 54-B España Extension, Quezon City. On April 14, 1957, Lolita disappeared from said house. After she left, her brothers and sisters checked her things and found that Lolita's clothes were gone. However, plaintiffs found a note on a crumpled piece of paper inside Lolita's aparador. The disappearance of Lolita was reported to the police authorities and the NBI but up to the present there is no news or trace of her whereabouts.

This prompted the filing of the current action with the CFI-Manila to recover moral, compensatory, exemplary and corrective damages in the amount of P94,000.00 exclusive of attorney's fees and expenses of litigation. Defendant, after denying some allegations contained in the complaint, set up as a defense that the facts alleged therein, even if true, do not constitute a valid cause of action.

The lower court, finding that Alfonso had carried on a love affair with Lolita Pe, being a married man himself, declared that Alfonso cannot be held liable for moral damages, it appearing that Lolita’s relatives failed to prove that Alfonso deliberately and in bad faith tried to win Lolita's affection. So it rendered a decision dismissing the complaint

Issue: May the parents and siblings of Lolita Pe recover damages based on the fact that defendant, being a married man, carried on a love affair with Lolita Pe thereby causing them injury in a manner contrary to morals, good customs and public policy?

Held: The present action is based on Article 21 of the New Civil Code. Conversely, the trial court considered the complaint not actionable for the reason that they failed to prove that Alfonso deliberately and in bad faith tried to win Lolita's affection.

The high Court refused to align itself to this view. The circumstances under which defendant tried to win Lolita's affection cannot lead, to any other conclusion than that it was he who seduced the latter to the extent of making her fall in love with him, as shown by the fact that defendant frequented the house of Lolita on the pretext that he wanted her to teach him how to pray the rosary. Because of the frequency of his visits to the latter's family who was allowed free access because he was a collateral relative and was considered as a member of her family, the two eventually fell in love with each other and conducted clandestine love affairs not only in Gasan but also in Boac.

Indeed, no other conclusion can be drawn from this chain of events than that Alfonso, through a clever strategy, succeeded in winning the affection and love of Lolita to the extent of having illicit relations with her. The wrong he has caused her and her family is indeed immeasurable considering the fact that he is a married man. Verily, he has committed an injury to Lolita's family in a manner contrary to morals, good customs and public policy as contemplated in Article 21 of the new Civil Code.

Malicious Prosecution

Lao vs. Associated Anglo American Tobacco

G.R. No. 47013 (2000)

Facts: The Associated Anglo-American Tobacco Corporation (AATC) entered into a "Contract of Sales Agent" with Andres Lao. Under the contract, Lao agreed to sell cigarettes manufactured and shipped by the AATC to his business address in Tacloban City. Lao would in turn remit the sales proceeds to AATC. For his services, Lao would receive commission depending on the kind of cigarettes sold, fixed monthly salary, and operational allowance. As a guarantee to Lao's compliance with his contractual obligations, his brother Jose and his

father Tomas executed a deed of mortgage in favor of AATC in the amount of P200,000.00.

Lao regularly remitted the proceeds of his sales to AATC, generating, in the process, a great deal of business. However, in February 1968 and until about seven (7) months later, Lao failed to accomplish his monthly sales report. He was reminded of his enormous accounts and the difficulty of obtaining a tally thereon despite Lao's avowal of regular remittances of his collections. Sometime later, Esteban Co, the vice-president and general manager of AATC, summoned Lao to Pasay City for an accounting where it was established that Lao's liability amounted to P525,053.47. And so, Lao and his brother Lao Y Ka, enlisted the services of the Sycip Gorres and Velayo Accounting Firm (SGV) to check and reconcile the accounts.

Subsequently, AATC discovered that Lao was engaging in the construction business so much so that it suspected that Lao was diverting the proceeds of his sales to finance his business. In the demand letter of April 15, 1979,counsel for AATC sought payment of the obligations of Lao, warning him of the intention of AATC to foreclose the mortgage. Attached to said letter was a statement of account indicating that Lao's total obligations duly supported by receipts amounted to P248,990.82.

Ngo Kheng was sent by AATC to supervise the sales operations of Lao in Samar and Leyte. It was discovered that, contrary to Lao's allegation that he still had huge collectibles from his customers, nothing was due to AATC from Lao's clients. From then on, Lao no longer received shipments from AATC which transferred its vehicles to another compound controlled by Ngo Kheng. Shipments of cigarettes and the corresponding invoices were also placed in the name of Ngo Kheng.

On May 21, 1970, Andres, Jose and Tomas Lao brought a complaint for accounting and damages with writ of preliminary injunction against AATC before the then CFI of Leyte in Tacloban City. The lower court ordered AATC to undergo a court-supervised accounting and to pay Lao: a) P180,000 representing actual loss of earnings, b) moral damages in the amount of P130,000.00, c) exemplary damages in the amount of P50,000.00, d) attorney's fees in the amount of P40,000.00, e) the compensation of the commissioners pro-rata and f) the cost of the suit. Upon conclusion of the accounting, the lower court revised its ruling, declaring Andres Lao's accountability to AATC in the amount of P167,745.20 and ordering him to pay same to AATC. On appeal, AATC was ordered by the CA to pay plaintiffs P150,000.00 actual damages for loss of earnings, P30,000.00 by way of moral damages and P10,000.00 for exemplary damages. The supplemental decision issued by the lower court, further, was reversed and set aside.

During the pendency of civil case, Esteban Co, as vice-president of AATC filed a criminal case for estafa against Lao. Without awaiting the determination of the criminal case, Lao lodged a complaint for malicious prosecution. The court ruled in favor of Lao declaring that the estafa case was filed without probable cause and with malice and ordered AATC and Esteban Co to jointly and severally pay Lao: a) P30,000 as actual damages, b) P150,000.00 as moral damages, c)P100,000.00 as exemplary damages and, d) P50,000.00 as attorney's fees and costs.

Issue: Is AATC liable for malicious prosecution?

Held: No. A reading of the complaint reveals that the complaint for malicious prosecution was founded on the filing of estafa against Lao. As such, it was prematurely filed and it failed to allege a cause of action.

The Court ruled that the complaint for damages based on malicious prosecution and/or on Articles 20 and 21 should have been dismissed for lack of cause of action. The Court of Appeals erred in affirming the decision of the trial court. It should be stressed, however, that the dismissal of subject complaint should not be taken as an adjudication on the merits, the same being merely grounded on the failure of the complaint to state a cause of action.

Malicious prosecution has been defined as an action for damages brought by one against whom a criminal prosecution, civil suit or other legal proceeding has been instituted maliciously and without probable cause, after the termination of such prosecution, suit or other proceeding in favor of the defendant therein.

Que vs. IAC

G.R. No. L-66865 (1989)

Facts: The origin of this dispute goes back to when Que and Nicolas were still in amicable terms. In July and August of 1975, Nicolas ordered from Que certain amounts of canvass strollers which were delivered to and accepted by Nicolas, who issued five checks therefore to Que worth P7,600. Nicolas, however, ordered the bank to stop payment because of defects in the articles sold which Que had not corrected. Que for his part argued that the allegedly defective articles were never returned to him until after he had filed the charge for estafa and that Nicolas had earlier merely ignored his complaints about the dishonored checks.

Que filed a complaint for estafa against Nicolas in the office of the city fiscal of Caloocan City for the issuance of several dishonored checks upon presentment. The charge was dismissed for lack of merit, the investigating fiscal holding that the controversy was an accounting matter that did not necessarily involve deceit on the part of Nicolas. Subsequently, Nicolas filed his own complaint for damages against Que with the CFI-Bulacan, for what he claimed was his malicious prosecution by the latter. Que now claims harassment. In his counterclaim, he

averred that Nicolas had maliciously filed the complaint in Bulacan although he was a resident of Caloocan City; that the private respondent was really indebted to him in any case and that it was he who had suffered damages as a result of the unwarranted suit.

Originally, the lower court held in favor of Antonio and awarded him the total amount of P80,500.00 in moral, exemplary, and nominal damages plus a P4,000.00 attorney's fee and the costs of the suit, finding was that Que had acted maliciously in filing the estafa charge and in alleging that the plaintiff had issued the dishonored checks with deceit.

Que’s motion for reconsideration was denied. A second motion for reconsideration was filed after a motion to stay the running of the period of appeal was filed. This second motion found merit, and reversed the original decision, awarding Que 10,000 as moral damages.

On appeal, the IAC reinstating the original decision of the trial court in favor of Nicolas.

Issue: Had Magtanggol Que instituted a malicious prosecution against Antonio Nicolas?

Held: The high Court ruled in the negative. It is evident that Que was not motivated by ill feeling but by anxiety to protect his rights when he filed the criminal complaint for estafa with the fiscal's office. If he averred that the Antonio had no funds in the bank when he issued the postdated checks and intended to cheat him, it was because the circumstances of the case as Que saw them led him to this conclusion. Even if the fiscal found that no deceit was involved and that the petitioner's claim was unfounded, the mistaken charge was nonetheless, in the legal sense, not malicious. As previously held in Manila Gas Corporation v. Court of Appeals, “To constitute malicious prosecution, there must be proof that the prosecution was prompted by a sinister design to vex and humiliate a person that it was initiated deliberately by the defendant knowing that his charges were false and groundless. Concededly, the mere act of submitting a case to the authorities for prosecution does not make one liable for malicious prosecution.”

The criminal complaint filed by the petitioner was not a mere ploy to enforce the payment of his account by Nicolas. There was here a genuine protest over the abrupt and suspicious order to stop the encashment of the checks issued to him by the private respondent. On the contrary, there is a stronger suggestion of malice on the part of Nicolas when he filed his suit for damages against Que in Bulacan, notwithstanding that the place of business was in Caloocan. However, inasmuch as good faith is presumed, and applying this presumption both to the petitioner and the private respondent, we hereby rule that, absent sufficient rebuttable evidence, neither of them is guilty of malice in their mutual relations.

Drilon vs CA

G.R. No. 107019 (March 20, 1997)

Facts: Drilon and company seek the reversal of the C.A. resolution affirming the orders of Judge Macli-ing denying their motion to dismiss the complaint of malicious prosecution filed by Homobono Adaza.

General Renato de Villa on March 20, 1990 requested the DOJ to order the investigation of several individuals, including Adaza, which he believed participated in the fail December 1989 coup d’état. Such was referred to the Special Composite Team of Prosecutors for inquiry. Said team from sufficient basis for Adaza’s prosecution and their report became the basis for the filing of a complaint for the crime of rebellion with murder and frustrated murder on April 18, 1990 before the RTC of Quezon City. Adaza then filed a complaint for damages on July 11, 1990 alleging that the information filed against him was a clear case of wilful and malicious prosecution and that the crime of rebellion with murder and frustrated murder was non-existent in the statute books.

Drilon and company filed a Motion to Dismiss Adaza's complaint on the ground that it states no actionable wrong constituting a valid cause of action on October 15, 1990. On February 8, 1991, Judge Macli-ing denied petitioners' Motion to Dismiss.

Drilon and Company then filed on June 5, 1991 a petition for certiorari under Rule 65 before the Court of Appeals; alleging Judge Macli-ing had committed a grave abuse of discretion in denying their motion to dismiss Adaza’s complaint on the ground that the later had sufficient cause of action.

Issue: Whether or not Adaza’s complaint has sufficient cause of action.

Held: No, Adaza’s complaint does not have a sufficient cause of action. In fact his complaint suffers a fatal infirmity as it does not state a cause of action on its face and must thus be dismissed.

Malicious prosecution has been defined in the Philippine jurisdiction as, “An action for damages brought by one against whom a criminal prosecution, civil suit, or other legal proceeding has been instituted maliciously and without probable cause, after the termination of such prosecution, suit, or other proceeding in favor of the defendant therein. The gist of the action is the putting of legal process in force, regularly, for the mere purpose of vexation or injury” (Cabasaan v. Anota, 14169-R, November 19, 1956).

The statutory basis for a civil action for damages for malicious prosecution are found in the provisions of the New Civil Code on Human Relations and on damages particularly Articles 19, 20, 21, 26, 29, 32, 33, 35, 2217 and 2219 (8). To prove malicious prosecution the all the following elements must be proven and concur: (1) the fact of the prosecution and the further fact that the defendant was himself the prosecutor and that the action finally terminated with an acquittal; (2) that in bringing the action, the prosecutor acted without probable cause; and (3) that the prosecutor was actuated or impelled by legal malice, that is by improper or sinister motive.

None of the above requisites were shown in the complaint of Adaza, thus rendering it dismissible under Sec. 1(g), Rule 16 of the Revised Rules of Court. The fact that Adaza was granted bail on account of a writ of habeas corpus is not sufficient ground for the filing of his complaint.

Moreover a complaint for malicious prosecution can only be filed if legal prosecution has been carried out without probable cause. Probable cause has been proven by the special composite team of prosecutors, and thus malicious prosecution has not been committed.

The prosecutors’ decision not to apply the doctrine enunciated in the case of People vs. Hernandez which enunciates that murder and common crimes committed as a necessary means for rebellion must be complexed, cannot be held as malicious as the prosecutors’ believed that the case against Adaza could be differentiated. The prosecutors believe that said acts of murder and frustrated murder committed by Adaza were not necessary for the rebellion.

Adaza’s error of failing to allege sufficient facts to constitute a cause of action for malicious prosecution on the face of his complaint should have been painfully obvious to Judge Macli-ing. The judge’s failure to notice such and denying the motion to dismiss the said complaint for said reason is indeed a grave abuse of discretion.

Public Humiliation

Patricio vs. Leviste

G.R. No. L-51832 (April 26, 1989)

Facts: Fr. Rafael Patricio, director general of the 1976 town fiesta of Pilar, Capiz was was slapped in public by Bienvenido Bacalocos, who was then the president of the association of barangay captains of Pilar, Capiz. The incident occurred on May 16, 1976 at about 10 p.m. during the benefit dance at the public auditorium. Bacalocos was then drunk and hand injured his hand after smashing his bottle of alcohol on the table. Bacalocos then approached Fr. Patricio and suddenly hit the latter’s face with his bloodied hand.

A criminal complaint for slander by deed was filed, but was subsequently dismissed. Fr. Patricio then filed a complaint for damages which was decided in his favor on April 18, 1978 resulting in the award of moral damages of P 10,000, exemplary damages of P 1,000 and attorney’s fees of 2,000. Fr. Patricio filed for a motion of execution of judgement on June 9, 1978, but was informed that such could not be done as a pending motion for reconsideration was apparently filed. Fr. Patricio then replied that the filing of said motion was without notice to him nor was there proof of service, thus the case had become final and unappealable. Bacalocos replied stating that a copy of the motion had been served by ordinary mail to the petitioner.

On August 3, 1979 the trial court ordered the dismissal of Fr. Patricio’s complaint stating that the motion for reconsideration must be given due course and that the award of moral and exemplary damages was not proper as compensatory or actual damages have not been proven. Fr. Patricio then filed this petition for review on certiorari, contenting that he had not been served notice of the motion for reconsideration, nor was there proof of such service, that the sending of the copy of said motion by regular mail did not cure said defect and finally that actual damages need not be proven before moral damages are given. Bacalocos replied that the order of the court a quo worked to inform Fr. Patricio of the motion and gave the latter opportunity to be heard; curing the defect. Bacalocos also reasoned that moral damages cannot be given as his act of slapping the priest was an accident cause by drunkenness and is absent of any bad faith.

Issue: Whether Bacalocos is liable for damages?

Held: Yes, he is liable for damages. With respect to the deficiency in the notice for the motion of reconsideration, the court deems the defect cured. Despite the fact that the notice was mailed via regular service and not registered mail, such technicality may be set aside because ultimately Fr. Patricio was able to appear before the court and have his side heard. Such is the spirit and purpose of the rule on notice and hearing.

As regards to the complaint for damages, the lower court’s theory that moral damages may only be awarded when actual damages are proven is untenable. Moral damages may be awarded in appropriate cases referred to in the chapter on human relations of the Civil Code (Articles 19 to 36), without need of proof that physical injury was caused upon the complainant. There is no question that moral damages may be recovered in cases where a defendant's wrongful act or omission has caused the complainant physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation and similar injury; as is, in the case at bar.

Bacaloco’s assertion that bad faith was not present when he hit the priest is also wanting, due to the fact that it was proven that a long time feud existed between their families.

Further, Bacalocos cannot hide behind the fact that he was drunk as he should be held responsible for all his actions.

Thus, Fr. Patricio may be awarded moral and exemplary damages, together with attorney’s fees for Bacaloco’s acts which are violation of article 21 in relation to article 2219 of the New Civil Code.

Grand Union Supermarket, Inc. vs. Espino

Gr No. L-48250 (December 28, 1979)

Facts: Jose J. Espino a civil engineer and an executive at Proctor and Gamble was shopping at South Supermarket in Makati on the morning of August 22, 1970. He had picked up a “rat tail” file from one of the shelves, placed it in his shirt pocket, with a good part of it exposed, and forgot to pay for it when he got to the cashier. As he and his wife and daughters were leaving the supermarket with their shopping bags, a security guard of the store approached Espino and informed him that he had an item in his pocket which he did not pay for. Espino immediately apologised and started to walk towards the cashier to pay for the item. He was then stopped by the guard and asked to go to the back of the supermarket to write an incident report as this was supposedly the procedure of the establishment.

Espino stated on the report that he put the item in his pocket as he was talking with his helper while in the store and that he merely forgot to present it to the cashier. Espino was then lead into the Supermarket and the report was given to Nelia Santos-Fandino who was seated at a desk beside the first checkout counter. Nelia after reading the report remarked that this was another case of theft, to which Espino explained that he merely forgot the “”rat tail” in his pocket and that he had the intention to pay for it. Neilia then replied to the effect that that was the same thing all shoplifters say when they are caught. This was done while people were lining up and paying for the items they shopped. Espino was then made to pay a fine of 5 pesos, which Nelia reasoned was a prize for the guard who apprehended him. Espino then paid the fine and was made to line up at the cashier to pay for the item. As he waited in line he was stared at and people were talking about him. Extremely humiliated by the incident he immediately left the premises after paying.

Espino filed a complaint on October 8, 1970 founded on article 21 in relation to article 2219 of the New Civil Code and prayed for damages. The CFI of Pasig, Rizal dismissed the complaint; but the Court of Appeals reversed such. Espino was granted moral damages at P 75,000, exemplary damages of P 25,000 Pesos, attorney’s fees at P 5,000 and the return of the P 5 fine. Grand Union Supermarket now appeals said decision citing that Espino was guilty of theft and that their action of apprehending and fining him was merely an exercise of their right to protect their property as enunciated in article 429 of the New Civil Code. They also stated that there was probable cause for his apprehension, that it was not done with malice or bad faith and the proximate cause for such was Espino’s own actions. They also argued that even if damages were in order, the amounts awarded were unconscionable.

Issue: Whether the act of apprehending Espino in such a manner would render the supermarket liable?

Held: Yes, such actions do render the supermarket liable. The court believes Espino committed an honest mistake when he forgot to pay for his item. This was proven by the fact that he put it in his pocket while he was preoccupied and that he apologised and immediately moved to pay for such at the instance the guard alerted him. The fact that he was an engineer, an executive of Proctor and Gamble, an esteemed member of society and a regular customer of the supermarket also belies motive to steal an item of an insignificant amount, which he was more than capable of paying for. Further, he was also in the company of his family, a deterrent from criminal activity.

It is also evident from the facts of the case that Espino was falsely accused of being a shoplifter in a manner contrary to morals, good customs or public policy and thus may be awarded damages. His being identified as a shoplifter in the incident report, being called such by Nelia and being made to pay a fine with a threat to call the police and report the incident if he would not do so, truly caused him humiliation and embarrassment.

However, the amount of damages should be modified. Espino’s forgetfulness was the proximate cause of the incident, and such contributory negligence would work to reduce the damages awarded, as enunciated in article 2214 of the New Civil Code. The court also considers the fact that the presence of shoppers in the premises was merely coincidental as it is a public place and their presence was not actively called for by the management in order to humiliate Espino. The court also believes that the management’s policy to have Espino brought to the back of the supermarket to make a report and to present him to one of the officers was not intentionally done to humiliate him because the supermarket’s business success would be compromised if it was seen that their public relations with customers were intentionally such. Moral damages are reduced to P 5,000, exemplary damages are deleted, attorney’s fees are reduced to P 2,000 and the P 5 fine must be returned.

Unjust Dismissal

Singapore Airlines vs. Pano Gr No. L-47739 June 22, 1983

Melencio-Herrera, J.

Facts: Carlos E. Cruz accepted employment as Engineer Officer with Singapore Airlines on August 30, 1974. His contract included a bond binding him for five years. He signed the contract with B.E. Villanueva as surety.

Later on Singapore airlines claimed that Cruz had breached the contract by going on unauthorized leave without pay without the requisite approval of his superiors. The airline sought payment of liquidated damages of $53,968.00 or (P161,904.00); $883.91 or (P2,651.73) as overpayment in salary; $61.00 or (P183.00) for cost of uniforms and accessories supplied by the company plus $230.00, or (P690.00), for the cost of a flight manual; and $1,533.71, or (P4,601.13) corresponding to the vacation leave he had availed of but to which he was no longer entitled; exemplary damages attorney's fees; and costs.

Cruz argued that there could not be any breach of contract as he was not actually required to serve for five years straight. He further posited that he had left the company on valid grounds which was accepted by the company, and thus no damages may be awarded. Villanueva on the other hand filled a cross-claim against Cruz for any damages the former

may be held liable against the airline. Villanueva argued that he was not a surety but a mere guarantor.

On October 28, 1977, Judge Pano dismissed the complaint, counterclaim and cross-claim for lack of jurisdiction; stating that the issue stems from an employer-employee relationship and thus jurisdiction is vested exclusively with the Labor Arbiter as enunciated in article 216 of the Labor Code. Singapore airlines filed for reconsideration, which was subsequently denied, thus their recourse to the Supreme Court.

Issue: Whether the case is cognizable by the Civil Courts or the Labor Arbiter?

Held: The Civil Courts hold jurisdiction over the case at bar. The case is actually grounded on the breach of contract by Cruz and not on his employer-employee relationship with the airline. This was clearly manifested by Cruz’s refusal and failure to report for duty without just cause and with malice and bad faith when he took his unauthorized leave which was in contravention with the stipulations of his contract. It is evident that the complaint was anchored on the effects of Cruz’s abandonment of work, which entitled the airline to damages.

Singapore Airlines does not seek the application of Labor laws but of the Civil Code regarding liquidated damages for the breach of a contract. Secondarily, the assertion of Villanueva that he is a mere guarantor is definitely a civil issue outside of the Labor Arbiter’s jurisdiction.

Thus, the case must be remanded to the proper Regional Trial Court.

Medina vs. Castro-Bartolome

G.R. No. L-59825 (September 11, 1982)

Facts: On December 20, 1977 at about 1 in the afternoon Cosme de Aboitiz, the president and chief executive officer, went to the Pepsi-Cola plant in Muntinlupa and shouted at Ernesto Medina, the former plant manager and Jose G. Ong, the former plant comptroller. De Aboitiz did so in front of all the employees, exclaiming:

“GOD DAMN IT. YOU FUCKED ME UP ... YOU SHUT UP! FUCK YOU! YOU ARE BOTH SHIT TO ME! YOU ARE FIRED (Medina). YOU TOO ARE FIRED! '(Ong)”

Medina and Ong filed a joint complaint for oral defamation on January 9, 1978 but the judge dismissed the complaint during the preliminary investigation on the ground that such expletives were said not as an insult or to cause humiliation, but merely as an expression of anger and displeasure on the part of de Aboitiz. Medina and Ong subsequently filed a petition for review which reversed the earlier resolution.

Apparently de Aboitiz was angry because the Muntinlupa plant had been delayed in the use of promotional crowns. Medina reasoned in his complaint that his plant was not that only one which was delayed and thus there was no cause for his humiliating dismissal. Further he opined that such removal was calculated in order to bring about the most humiliation as it was done in front of all of his subordinates hours before the Christmas party; the dismissal was executed by de Aboitiz himself and not another lower ranking officer, that it was made just after they were awarded loyalty rings for their long service with the company and that it was done just five days before Christmas.

The court awarded Medina and Ong P 300,000 in moral damages, P 100,000 in exemplary damages, P 5,000 in litigation expenses and P 10,000 and P 200 per appearance as attorney’s fees. De Aboitiz moved to dismiss said complaint on the ground of lack of jurisdiction, but was subsequently denied because the case was declare to be a civil case for damages and not one regarding their employer-employee relationship, which would in the latter case be cognizable by the Labor Arbiter.

On January 23, 1981 de Aboitiz again filed a second motion to dismiss on the ground that P.D. No. 1691 amending Art. 217 of the Labor Code of the Philippines and Batasan Pambansa Bldg. 70 which took effect on May 1, 1980, amending Art. 248 of the Labor Code vested exclusive jurisdiction to the Labor Arbiter and included Art. 248, thereof ... "which may include claims for damages and other affirmative reliefs." Thus, the case was regarded by the court a quo as now being within the jurisdiction of the Labor Arbiter. Said court also ruled that because said presidential decree was a curative statute, it could be applied retroactively and thus the case was dismissed.

Issue: Whether the promulgation of P.D. No. 1691 did indeed remove the case from the jurisdiction of the Civil Courts?

Held: No, said law did not do so. The Labor Code has no relevance in the case as it does not provide the reliefs sought for by Medina and Ong. Said reliefs could only be granted by the Civil Code as it is an action for torts and damages. Medina and Ong did not allege any unfair labor practice in their complaint. Thus this case is governed by the Civil Code and not the Labor Code. The petition is granted and the case reinstated to be decided on the merits.

Derelection of duty

Amaro vs. Sumanguit

Gr No. L-14986 (July 31, 1962)

Facts: On October 5, 1958 Jose amaro was assaulted and shot near the city government building of Silay, Negros Occidental by a police officer. He, together with his father and witnesses went to the office of Ambrosio Sumanguit, the chief of police of the city to complain. However instead of gaining assistance they were harassed terrorized and were forced to give up prosecuting the crime. Amaro still persisted and obtained the aid of the city attorney who was about to file an information for the illegal discharge of firearm against one of the police officers. Because of this, the harassment by the chief of police continued, trying to force the Amaros to give up and sign prepared affidavits exculpating the police from dereliction of duty with regard to the above said crime.

The complaint was dismissed upon Sumanguit’s motion, on the ground that it does not it does not state facts sufficient to constitute a cause of action.

Issue: Whether such dismissal is valid on such ground?

Held: No, such dismissal was invalid. Although the complaint did not specifically allege so, it was an action predicated on articles 21 and 27 of the Civil Code. The facts presented although vague do constitute an actionable dereliction of duty as enunciated in article 27 as the chief of police refused to give them assistance without just cause, when it was said officer’s duty to perform such.

Although the complaint was imperfectly drafted, ambiguous, indefinite and uncertain, such are not grounds for dismissal of the case under Rule 8. The proper procedure would be to ask for a bill of particulars under Rule 16 to fix said curable defects.

The Amaros have recourse to file their complaint for illegal discharge of firearm directly with the city attorney and/or file an administrative complaint against the chief of police. Both of which do not preclude an action for damages under article 27 of the Civil Code. Thus, the dismissal is set aside and the case remanded to the appropriate court for further proceedings.

Violation of human dignity and Privacy

St. Louis Realty Corporation vs. C.A. GR No L-46061 (November 14, 1984)

Facts: St. Louis Reality Corp. caused to be published on the December 15, 1968 Sunday Times an advertisement featuring the house of Dr. Conrado J. Aramil. Said advertisement was entitled “Where the Heart is”, showed a picture of Dr. Aramil’s house but with the family of Arcadio S. Acradio depicted as the owners. It also had written text stating that the Arcadios had purchased such house in Brookside Hills village at an affordable rate. Such was done without the permission of Dr. Aramil.

Upon seeing a reprint of the advertisement on the same paper on January 5, 1969, Dr. Aramil immediately wrote said reality corporation stating that the latter did not obtain permission to post his house in the advertisement and depict it as being owned by another family. Dr. Aramil explained that it has caused him humiliation as his colleagues and friends who recognize his house or have been to such have uttered remarks questioning the ownership of his house, his integrity, if he rented the house from the Arcadios and even that his wife was that of another husband. He then warned the corporation that he would pursue legal action if such acts were not explained satisfactorily to him within one week of receipt of the letter.

Said letter was received and answered by Ernesto Magtoto, an officer of said corporation who was in charge of advertising. He immediately stopped its publication and contacted Dr. Aramil to apologise. However no rectification or apology was ever published. Dr. Aramil’s counsel demanded actual, moral and exemplary damages of P 110,000 from the corporation on February 20, 1969. The corporation answered by claiming that it was an honest mistake and that a rectification will be made.

The corporation published a new advertisement on March 18, 1969 which again portrayed the Arcadio family, but this time with their real house. However no apology or rectification was included. This led to the filing of a complaint for damages against the said corporation on March 29, 1969. The lower court and appellate court ruled in favor of Dr. Aramil; awarding him P 8,000 as actual damages, P 20,000 as moral damages and P 2,000 for attorney’s fees.

Issue: Whether the case is covered by article 26 of the Civil Code?

Held: Yes, the case falls under said article which warrants the award of damages to Dr. Aramil. Said article provides that "every person shall respect the dignity, personality, privacy and peace of mind of his neighbors and other persons". "Prying into the privacy of another's residence" and "meddling with or disturbing the private life or family relations of another" and "similar acts", "though they may not constitute a criminal offense, shall produce a cause of action for damages, prevention and other relief". Such article was violated when the corporation released an advertisement depicting Dr. Armil’s home to be that of another, without Dr. Aramil’s permission. Further, bad faith and negligence was evident as the corporation refused to publish a rectification or apology despite demands.

The damages awarded are proper being enunciated by Articles 2200, 2208 and 2219 of the Civil Code. Article 2219 allows moral damages for acts mentioned in Article 26.

Concepcion v. CA

Gr No 120706 (January 31, 2000)

Facts: Nestor Nicolas and family were leases of an apartment owned by Florence Conception located at San Joaquin, Pasig City. Nestor was engaged in the business of supplying office equipment, appliances and other fixtures to government agencies. He had convinced Florence to join in by inputting capital in exchange for an equal division of profits earned.

The problem started when Florence’s deceased husband’s brother, Rodrigo Conception, suddenly confronted Nestor at his apartment on the second week of July 1985. He accused Nestor of being an adulterer, receiving P 100,000 from Florence to go to Baguio with his family, but secretly returning to Manila to have a tryst with Florence. Nestor even accompanied Rodrigo to ask the relatives whom the rumor allegedly came from, they however denied any knowledge. Rodrigo again accused Nestor of being an adulterer when they met Florence at the terrace of her residence when the two confronted her about the rumor. Both Nestor and Florence denied such. Rodrigo continued to harass Florence via phone, even saying that he would kill her if anything should happen to his mother.

As a result Nestor felt ashamed and embarrassed to face his neighbors as they had heard or had been present during Rodrigo’s confrontation. His business was also in decline as Florence discontinued her capital input. Moreover, his wife, Allem started to distrust him and constant fighting ensued due to the rumor spread by Rodrigo. Nestor then demanded that Rodrigo make a public apology and pay damages. Rodrigo refused to do so and reasoned that he was only protecting his family’s reputation. The RTC and Court of Appeals ruled in favor of Nestor, awarding him P 50,000 for moral damages, P25,000 for exemplary damages, P 10,000 for attorney’s fees and the cost of suit.

Issue: Whether the awarding is with basis or not?

Held: Yes, such decision is with legal and factual basis. First, Rodrigo’s claim that the awarding was without legal basis is bereft of merit. His actions of confronting Nestor in the latter’s apartment and hurling accusations that Nestor was an adulterer within view and hearing range of the public is indeed a violation of articles 26 and 2219 of the Civil Code as such an act is indeed a form of defamation and intrudes into the privacy of Nestor’s home and family life. Further, under article 2217 of the Civil Code, moral damages which include physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation, and similar injury, although incapable of pecuniary computation, may be recovered if they are the proximate result of the defendant's wrongful act or omission. Such was manifest when Nestor was so humiliated that he could not face his neighbours, his constant quarrels with his wife and the decline of his business.

Rodrigo’s second contention that the facts and circumstances of the case were manifestly overlooked misunderstood or glossed over by respondent court which, if considered, would change the verdict. The court sees no such error. The totality of the evidence and facts presented truly show that Rodrigo had defamed Nestor. The minor inconsistencies of the testimonies and affidavits of witnesses do not debunk Nestor’s case; in fact they are a badge of its authenticity as experience would dictate that minor inconsistencies are to be expected.

Rodrigo’s final contention is that the appellate court did not take into account the fact that the lower court’s judge who penned the decision was not the original judge who heard his case; and is thus not in a position to properly weigh the facts and circumstances of the case leading to a flawed decision. The court finds this untenable. First off the Supreme Court as a rule respects the finds of the lower court and shall not disturb such unless it finds good reason to do so. No such reason in this case exists or has been proven. The mere fact that the lower court judge who penned the decision was not the one who heard the case does not destroy the presumption of regularity of the judge’s performance. The judge is presumed and held to have made his decision after reviewing the facts and circumstances which are kept in the records of the case.

Thus the totality of the facts and circumstances lead the court to believe that indeed Rodrigo had defamed Nestor and is thus liable for damages. The damages previously awarded are affirmed.

Concept of Damages

Heirs of Borlado vs. Vda. De Bulan

G.R. 114118 (2001)

Facts: A parcel of land owned by Serapio Borlado, grandfather of petitioners, was sold for consideration to Francisco Bacero who in turn sold it to the Spouses Bienvenido Bulan and Salvacion Borbon, respondents herein. The respondents had been in continuous, peaceful, uninterrupted, adverse and exclusive possession of the lot until petitioners forcibly entered and wrested physical possession thereof from them.

Respondents filed an ejectment suit against petitioners, which was decided in their favour. The court ordered petitioners to vacate the land and to pay to respondents a total amount of One Thousand One Hundred (1,100) cavans of palay as well as attorney’s fees and the cost of suit.

Issue: Whether the CA erred in declaring the respondents as owners of the lot.

Held: The petition was denied since the issue involved was factual and did not fall under the exceptions that the SC may not review factual findings of the CA on appeal via certiorari. However, the court modified the judgment with respect to the award of the cavans of palay as a form of damages in the absence of legal basis since "Palay" is not legal tender currency in the Philippines.

Lazatin vs. Twano

GR No. L-12736 (July 31, 1961)

Facts: Properties of appellant Lazatin were levied and sold in public auction to satisfy a judgment in favour of herein appellees Twaño and Castro. Lazatin deposited the redemption price with the Sheriff before the expiration of the redemption period. To ensure payment of claim in the present action, Lazatin secured a writ of attachment on the amount deposited.

Issue: Whether the estate of Lazatin is liable to pay damages for the alleged malicious attachment

Held: The defendants, Twaño and Castro, are not entitled to moral damages. The law on damages is found on Title XVII of the Civil Code but rules governing damages laid down in other laws, and the principles of the general law on damages are adopted in so far as they are not in consistent with the Code.

Moral damages may be recovered, among others, in cases of malicious prosecution. But in order that moral damages may be recovered in connection with a writ of attachment, malice must exist.

The Rules of Court requiring the attachment plaintiff to provide a bond from which the costs and all damages are to be enforced should the court find that the plaintiff is not entitled to the attachment merely provides recovery on the bond based on the undertaking and not from any tortious act. Consequently, the appellees may recover only the actual damages and not moral damages.

Actual or Compensatory Damages

Algarra vs. Sandejas

GR No L-8385 (March 24, 1914)

Facts: Plaintiff filed a civil action against defendant for injuries resulting from an automobile collision due to the latter’s fault. At the time of the accident, plaintiff sold the products of a distillery and made an average of P50 per month. As a result of the collision, plaintiff incurred medical expenses, and suffered business losses with only four out of his twenty regular customers remaining.

The lower court refused to grant plaintiff’s claim for injuries to his business due to his enforced absence therefrom.

Issue: Whether plaintiff is entitled to damages for injuries to his business

Held: An action for damages is based on Article 1902, which provides:

“A person who, by act or omission, causes damage to another where there is fault or negligence shall be obliged to repair the damage so done.”

Actual damages include not only loss already suffered, but loss of profits which may not have been realized. Under both American Law and the Spanish Civil Code, actual damages for a negligent act or omission include those foreseen at the time of the injury or its necessary consequence. Evidently, plaintiff is entitled to recover damages resulting from his actual incapacity. With respect to the damage to his business the court ruled that “the profits of an established business may be considered in calculating the measure of damages for an interruption of it”.

Kinds of Actual Damages

Integrated Packaging Corp. vs. CA

GR No. 115117 (June 8, 2000)

Facts: Petitioner, Integrated Packaging, and private respondent, Fil-Anchor Paper Co., Inc., entered into a contract whereby private respondent would deliver 3450 reams of printing paper on specified schedules to be paid within a maximum period of ninety days. Private respondent delivered 1097 out of 3450 reams to petitioner, but the latter failed to pay the amount due causing private respondent to file a collection suit against petitioner.

In its counterclaim petitioner contends that by reason of respondents failure to deliver the 3450 reams as agreed upon, it was unable to complete its printing obligation with Philacor resulting to actual damages and unrealized expected profits.

Issue: Whether private respondent is liable for petitioner’s breach of contract with Philacor.

Held: Private respondent was justified in suspending its deliveries when petitioner failed to pay within ninety days from receipt of the goods as agreed upon. Neither may private respondent be held liable for the breach of contract committed by petitioner against Philacor when respondent was not a party thereto.

Indemnification for damages includes loss suffered or actual damages (damnum emergens) and profits which the obligee failed to obtain or compensatory damages (lucrum cessans); however, it is necessary to prove actual amount of loss. The court ruled that it was erroneous to conclude that petitioner would have earned a profit of P 790, 324.30 since these were based on speculation and were hypothetical. Neither is petitioner entitled to moral damages in the absence of bad faith, or gross negligence amounting to bad faith.

Attorney’s fees

Quirante v. Intermediate Appellate Court

G.R. No. 73886 (January 31, 1989)

Facts: On June 18, 1983, herein petitioner Quirante filed a motion in the trial court for the confirmation of his attorney's fees. According to him, there was an oral agreement between him and the late Dr.Casasola with regard to his attorney's fees, which agreement was allegedly confirmed in writing by the widow, Asuncion Vda. De Casasola, and the two daughters of the deceased, namely Mely C. Garcia and Virginia C. Nazareno. Petitioner avers that pursuant to said agreement, the attorney's fees would be computed as follows:

A. In case of recovery of the P120,000.00 surety bond, the attorney's fees of the undersigned counsel (Atty. Quirante) shall be P30,000.00.

B. In case the Honorable Court awards damages in excess of the P120,000.00 bond, it shall be divided equally between the Heirs of I. Casasola, Atty. John C. Quirante and Atty. Dante Cruz.

The trial court granted the motion for confirmation in an order dated March 20, 1984, despite an opposition thereto. It also denied the motion for reconsideration of the order of confirmation in its second order dated May 25, 1984. The Court of Appeals set aside the two orders and made the previous restraining order permanent.

Issue: Whether or not Petitioner Quirante is allowed to recover his attorney’s fees even if the case has not yet been decided?

Held: What is being claimed here as attorney's fees by petitioners is, however, different from attorney's fees as an item of damages provided for under Article 2208 of the Civil Code, wherein the award is made in favor of the litigant, not of his counsel, and the litigant, not his counsel, is the judgment creditor who may enforce the judgment for attorney's fees by

execution. Here, the petitioner's claims are based on an alleged contract for professional services, with them as the creditors and the private respondents as the debtors.

Since the main case from which the petitioner's claims for their fees may arise has not yet become final, the determination of the propriety of said fees and the amount thereof should be held in abeyance. This procedure gains added validity in the light of the rule that the remedy for recovering attorney's fees as an incident of the main action may be availed of only when something is due to the client. Thus, it was ruled that:

... an attorney's fee cannot be determined until after the main litigation has been decided and the subject of recovery is at the disposition of the court. The issue over attorney's fee

only arises when something has been recovered from which the fee is to be paid.

As regards to the effect of the alleged confirmation of the attorney's fees by some of the heirs of the deceased. We are of the considered view that the orderly administration of justice dictates that such issue be likewise determined by the court a quo inasmuch as it also necessarily involves the same contingencies in determining the propriety and assessing the extent of recovery of attorney's fees by both petitioners herein. The court below will be in a better position, after the entire case shall have been adjudicated, inclusive of any liability of PHILAMGEN and the respective participations of the heirs of Dr.Casasola in the award, to determine with evidentiary support such matters like the basis for the entitlement in the fees of petitioner Dante Cruz and as to whether the agreement allegedly entered into with the late Dr.Casasola would be binding on all his heirs, as contended by petitioner Quirante.

We, therefore, take exception to and reject that portion of the decision of the respondent court which holds that the alleged confirmation to attorney's fees should not adversely affect the non-signatories thereto, since it is also premised on the eventual grant of damages to the Casasola family, hence the same objection of prematurity obtains and such a holding may be pre-emptive of factual and evidentiary matters that may be presented for consideration by the trial court. WHEREFORE, with the foregoing observation, the decision of the respondent court subject of the present recourse is hereby AFFIRMED.

Interest

Crismina Garments, Inc. vs. CA

G.R. No.128721 (March 9, 1999)

Facts: Petitioner (Crismina Garments) contracted the services of the respondent (D’Wilmar Garments) for sewing 20,762 pairs of denims. The total of which amounted to 76,410.

Petitioner failed to pay the aforesaid amount. As a result, Respondent filed a complaint against petitioner for the collection of payment. Trial Court ruled in favor of the respondent and ordered the petitioner to pay the sum of 76,140 with interest at 12% per annum. CA affirmed the trial Courts ruling. Hence, a Petition for review was filed.

Petitioner submits that the interest rate should be 6% pursuant to Art. 2209 of the Civil Code. On the other hand private respondent maintains that the interest rate should be 12% per annum in accordance with Central bank Act, since the money sought to be recovered by her is in the form of forbearance.

Issue: Whether or not it is proper to impose interest at the rate of 12% per annum for an obligation that does not involve a loan or forbearance of money in the absence of stipulation of the parties.

Held: Because the amount due in this case arose from a contract for a piece of work, not from a loan or forbearance of money, the legal interest of six percent (6%) per annum should be applied.

Furthermore, since the amount of the demand could be established with certainty when the complaint was filed, the six percent (6%) interest should be computed from the filing of the said complaint. But after the judgment becomes final and executory until the obligation is satisfied, the interest should be reckoned at twelve percent (12%) per year.

Private respondent maintains that the twelve percent (12%) interest should be imposed, because the obligation arose from a forbearance of money. This is erroneous. In eastern Shipping, the Court observed that “forbearance” in the context of the usury law is a “contractual obligation of lender or creditor to refrain, during a given period of time, from requiring the borrower or debtor to repay a loan or debt then due and payable.” Using this standard, the obligation in this case was obviously not a forbearance of money, goods or credit.

Mitigation of Liability

Cerrano vs. Tan Chuco

38 Phil 392 (August 1, 1918)

Facts: Tan Chuco, who was then the owner of casco No. 1033, rented it to Vicencio Cerrano at a monthly rental of P70. Tan Chuco notified Vicencio Cerrano that in the following month it would be necessary to send the casco to Malabon for repairs. Cerrano then informed Tan Chuco that he would like to rent the casco again after repairs had been completed. Tan Chuco indicated that he was willing to rent it, but would expect P80 a month for it, by which Cerrano acceded to the demand. About one week before the end of the repair period, Tan Chuco sold the casco to Siy Cong Bieng & Co. Santos, the man who had been employed by Cerrano, upon hearing of the said sale went to the office of Siy Cong Bieng & Co. and asked for employment in the same capacity. Cerrano, claiming that he was entitled to the possession of the casco under his contract with Tan Chuco, regardless of its sale to Siy Cong Bieng & Co. induced Santos to refuse to take orders from the new owners.

As a result Siy Cong Bieng & Co. were obliged to bring an action of replevin against Santos for the recovery of the possession of their casco. Upon this judgment was entered for the delivery of casco to Siy Cong Bieng& Co. and for damages. Cerrano, paid the judgment in favor of Siy Cong Bieng& Co. in the replevin suit, for which he had become liable under the terms of the delivery bond.

Issue: Whether Tan Chuco is liable for damages for breach of contract.

Ruling: Yes. Under the terms of his contract Tan Chuco was bound to deliver the casco to Cerrano for one month from the date upon which the repairs were ended, but was under no obligation to renew the contract at the end of the month. By selling the casco to Siy Cong Bieng & Co. he broke his contract with Cerrano and is responsible for the damages caused by

his failure to give Cerrano possession of the casco for the term of one month. The Court is of the opinion that Cerrano is entitled to recover damages for the breach of contract, the profit by which he would have been able to make had the contract been performed.

Article 1106 of the Civil Code establishes the rule that prospective profits may be recovered as damages, while article 1107 of the same Code provides that the damages recoverable for the breach of obligations not originating in fraud (dolo) are those which were or might have been foreseen at the time the contract was entered into. Applying these principles to the facts in this case, we think that it is unquestionable that defendant must be deemed to have foreseen at the time he made contract that in the event of his failure perform it, the plaintiff would be damaged by the loss of the profit he might reasonably have expected to derive from its use.

Moral Damages

Kierulf vs. CA

G.R. No. 99301 (March 13, 1997)

Facts: The Pantranco bus was traveling along EDSA from Congressional Avenue towards Clover Leaf, Balintawak. The driver lost control of the bus along the way, causing it to swerve to the left, and then to fly over the center island occupying the east-bound lane of EDSA. The front of the bus bumped the front portion of an Isuzu pickup driven by Legaspi. Damages to both vehicles occured and physical injuries were inflicted on Legaspi and his passenger Lucila Kierulf, both of whom were treated at the Quezon City General Hospital. The bus also hit and injured a pedestrian who was then crossing EDSA. Despite the impact, said bus continued to move forward and its front portion rammed against a Caltex gasoline station, damaging its building and gasoline dispensing equipment. As a consequence of the incident, Lucila suffered injuries. The injuries sustained by Lucila required major surgeries like "tracheotomy, open reduction, mandibular fracture, intermaxillary repair of multiple laceration" and prolonged treatment by specialists. Legaspi also suffered injuries.The front portion of the pickup truck, owned by Spouses Kierulf, was smashed to pieces. The cost of repair was estimated at P107,583.50.

Pantranco in its petition alleged that it was driven by Jose Malanum. While cruising along EDSA, a used engine differential accidentally and suddenly dropped from a junk truck in front of the bus. Said differential hit the under chassis of the bus, throwing Malanum off his seat and making him lose control of said bus. The bus swerved to the left, hit the center island, and bumped the pickup of the spouses.

The plaintiffs alleged that the moral damages awarded by Respondent Court are "clearly and woefully not enough." The established guideline in awarding moral damages takes into consideration several factors, some of which are the social and financial standing of the injured parties and their wounded moral feelings and personal pride. The Kierulf spouses add that the Respondent Court should have considered another factor: the loss of their conjugal fellowship and the impairment or destruction of their sexual life and that the moral damages awarded in favor of Lucila should be increased to P1,000,000.00, not only for Lucila but also for her husband Victor who also suffered "psychologically." Pantranco rebuts that Article 2219 of the Civil Code provides that only the person suffering the injury may claim moral damages. Additionally, no evidence was adduced to show that the consortium had indeed been impaired and the Court cannot presume that marital relations disappeared with the accident

Issue: How much moral, exemplary and actual damages are victims of vehicular accidents entitled to?

Held: The Supreme Court ruled in this case that “the Rodriguez case clearly reversed the original common law view first enunciated in the case of Deshotel vs. Atchison, that a wife could not recover for the loss of her husband's services by the act of a third party. Rodriguez ruled that when a person is injured to the extent that he/she is no longer capable of giving love, affection, comfort and sexual relations to his or her spouse, that spouse has suffered a direct and real personal loss. The loss is immediate and consequential rather than remote and unforeseeable; it is personal to the spouse and separate and distinct from that of the injured person.

Whether Rodriguez may be cited as authority to support the award of moral damages to Victor and/or LucilaKierulf for "loss of consortium," however, cannot be properly considered in this case.

Victor's claim for deprivation of his right to consortium, although argued before Respondent Court, is not supported by the evidence on record. His wife might have been badly disfigured, but he had not testified that, in consequence thereof, his right to marital consortium was affected. Clearly, Victor (and for that matter, Lucila) had failed to make out a case for loss of consortium, unlike the Rodriguez spouse. Again, we emphasize that this claim is factual in origin and must find basis not only in the evidence presented but also in the findings of the Respondent Court. For lack of factual basis, such claim cannot be ruled upon by this Court at this time. The social and financial standing of Lucila cannot be considered in awarding moral damages. The factual circumstances prior to the accident show that no "rude and rough" reception, no "menacing attitude," no "supercilious manner," no "abusive language and highly scornful reference" was given her.

The social and financial standing of a claimant of moral damages may be considered in awarding moral damages only if he or she was subjected to contemptuous conduct despite the offender's knowledge of his or her social and financial standing.

Be that as it may, it is still proper to award moral damages to Petitioner Lucila for her physical sufferings, mental anguish, fright, serious anxiety and wounded feelings. She sustained multiple injuries on the scalp, limbs and ribs. She lost all her teeth. She had to undergo several corrective operations and treatments. Despite treatment and surgery, her chin was still numb and thick. She felt that she has not fully recovered from her injuries. She even had to undergo a second operation on her gums for her dentures to fit. She suffered sleepless nights and shock as a consequence of the vehicular accident. In this light and considering further the length of time spent in prosecuting the complaint and this appeal, we find the sum of P400,000.00 as moral damages for Petitioner Lucila to be fair and just under the circumstances.

Proof and Proximate Cause

Miranda-Ribaya vs. Carbonell

G.R. No. L-49390 January 28, 1980

Facts: Mrs. Niceta Miranda-Ribaya was engaged sometime in 1968 in the pawnshop business and in the buying and selling of jewelry.

Prior to April 23, 1968 one of her agents, Mrs. Josefina Roco-Robles, informed her that a millionaire logger by the name of Marino Bautista was interested to buy big diamond

stones.

Mrs. Ribaya accompanied by her agent, Mrs. Robles dropped by the house of Mr. and Mrs. Marino Bautista on April 23, 1968 at La Salle Street, Greenhills Mandaluyong, Rizal.

Mrs. Ribaya was convinced that the Bautistas were millionaires as represented by her agent. On that occasion both Mr. and Mrs. Bautista were present together with Gloria Duque, the secretary of Mr. Bautista, and the couple's daughter, Teresita.

Mrs. Ribaya sold to the Bautistas 10 pieces of jewelry for the price of P222,000.00 (originally priced at P224,000.00). Mr. Bautista acknowledged the receipt of the jewelry as well as the agreed purchase price by signing the receipt and Mrs. Ribaya in turn was paid in the form of the two (2) Equitable Banking Corporation checks Nos. 10767485-A for P112,000.00 (Annex B of the complaint) and No. 10755100-A for P110,000.00, both checks postdated June 23, 1968. Mrs. Ribaya then executed a voucher evidencing said payment

Mrs. Ribaya, accompanied by Miss Narcisa Gosioco, went back the next day to request Bautista to break up the Equitable Banking Corporation Check No. 10755100-A for P110,000.00 into separate check inasmuch as part of the jewelry sold to Bautista the previous day belonged to Mrs. Gosioco. Bautista accommodated them with four (4) Bank of Amerca checks DD-8112 for P14,000.00, DD-8113 for P34,000.00, DD- 8114 for P12,000.90 and DD-9115 for P50,000.00 P110,000.00, all postdated June 23, 1968. Mrs. Ribaya delivered Account Nos. 8113 and 8114 to Miss. Gosioco and kept for herself checks Nos. 8115 and 8112. On the same day, she also sold to the Bautistas 4 pieces worth P94,000.00. Bautista issued Bank of America Checks Nos. DD-8106 forP12,000.00, DD-8111 for P12,000.00, DD-8110 for P35,000.00, and DD-8107 for P35,000.00, all post dated June 23, 1968.

As some of the owners of the jewelry sold to the defendants by Ribaya on April 23, 1968 and April 24, 1968 wanted to get back their jewelry, Mrs. Ribaya on May 15, 1968 went back to the house of the Bautistas accompanied by Gloria Duque bringing with her 3 pieces of jewelry in exchange for some pieces previously sold to defendant Bautista. She left the jewelry with Bautista but instead of exchanging the jewelry Bautista issued to Mrs. Ribaya another Bank of America check No. DD-8130 for P45,000.00 postdated July 17, 1968.

Ribaya tried to contact Bautista when the checks matured, but were unable to do so. She deposited the checks to her account but they were dishonored by the bank for the reason that the accounts of the defendant were closed.

Suspecting that the Bautistas might have pawned the pieces of jewelry purchased from her, she went to the pawnshop section of the Manila Police Department and discovered that most of the jewelry she had sold to the defendants were pledged to various pawnshops in Manila.

Mrs. Ribaya confronted Marino Bautista, who assured her that he would pay her their obligation. After failing to comply, Mrs. Ribaya demanded from Bautista the surrender of the pawnshop tickets covering the pledge of the jewelry he obtained from her. She was able to redeem part of the jewelry she delivered to the Bautistas.

It was computed that Bautista's obligations amounted to P125,460.79.

The trial court rendered judgment sentencing the Bautistas to pay petitioners the sum of P125,460.79 with interest and 25% thereof for attorney's fees and expenses of litigation.

The claim for moral and exemplary damages was denied on the ground that the evidence adduced by the plaintiffs [was] insufficient to warrant its grant.

ISSUE: Are petitioners entitled to moral and exemplary damages?

HELD: Yes. In Francisco vs. Government Service Insurance System, the Court had sustained the trial court's appealed decision denying the therein prevailing plaintiff's claim for moral a nd exemplary damages "not only on account of the plaintiff's failure to take the witness stand and testify to her social humiliation, wounded feelings, anxiety, etc., but primarily because a breach of contract like that of defendant, not being malicious or fraudulent, does not warrant the award of moral damages.

Here, the facts and circumstances are totally different. In that case, therein plaintiff failed to take the witness stand and defendant's breach of contract was held to be not malicious and fraudulent. In the present case, petitioner took the witness stand and established by uncontradicted testimony that due to respondents' deceitful and malevolent acts of defraudation, she had suffered "extreme" anguish and "could not sleep for three months," since she was forced to close her pawnshop, sell some of her personal jewelries and borrow money in order to pay off the owners of the jewelries wrongfully gotten by respondents from her. The evidence of record shows the magnitude of respondents' wanton, fraudulent and malevolent acts of defraudation.

Petitioners' testimonial evidence to the effect that she suffered "extremely" and that for three months she could not sleep was a clear demonstration of her physical suffering, mental anguish and serious anxiety and similar injury, resulting from respondents' malevolent acts that show her to be clearly entitled to moral damages.

Petitioners having established the more damages, are entitled in addition thereto, to exemplary damages. The wantonness and malevolence through which respondents defrauded petitioners, deceitfully incurring and then evading settlement of their just liability certainly justifies the award of exemplary damages by way of example and correction for the public good and also to serve as a deterrent to the commission of similar misdeeds by others, even if the transaction were viewed as a breach of civil contract.

Del Rosario vs. CA

G.R. No. 118325 (January 29, 1997)

Facts: In selling to the public roofing materials known as "Banawe" shingles, Metal Forming Corporation (MFC) made representations on the durability of the product and the sturdiness of its installation, characterizing the shingles as "STRUCTURALLY SAFE AND STRONG" and that the "BANAWE METAL TILE structure acts as a single unit against wind and storm pressure due to the strong hook action on its overlaps". It prompted the Del Rosarios to buy the "Banawe" shingles and have them installed at their residence.

Two months after installation, portions of the roof of the Del Rosarios were blown away by the typhoon "Ruping", and the same acted in parts (instead of as a single unit) when strong winds blew, a part remaining while another part was blown off.

The Del Rosarios' filed a complaint on November 21, 1990, charging MFC with a violation of Section 3 of Act No. 3740, "An Act to Penalize Fraudulent Advertising, Mislabeling or Misbranding of Any Product, Stocks, Bonds, etc." After due proceedings, the DTI rendered judgment sentencing MFC to pay an "administrative fine of P10,000.00".

MFC however declined to concede liability for the other damages claimed by the Del Rosario Spouses to have been caused to the interior of their home. The spouses sought to recover from MFC, damages resulting from the events just narrated, contending that aside from the destruction of the roof of their house, injury was also caused to its electrical wiring, ceiling, furtures, walls, wall paper, wood parquet flooring and furniture. They reckoned their actual damages at P1,008,003.00 and prayed for an award to them of moral damages in the sum of P3,000,000,00, exemplary damages in the amount of P1,000,000.00, and attorney's fees in the sum of P1,000,000.00.

MFC moved to dismiss the complaint for lack of cause of action, alleging that it had no contractual relationship with the Del Rosarios since the contract for the purchase and installation of the roofing, upon which the latter's claims were based, was actually entered into between it and another person, Jesus M. Puno (an engineer identified as the Del Rosarios' contractor).

Judgment was rendered in favor of the Del Rosarios.

Issue: Are the Spouses entitled to moral damages?

Held: Yes. It is indisputable that (1) the tiles were delivered to the Del Rosarios and used in fabricating the roof of their home, and (2) that it was the employees and workers of MFC who (a) delivered the shingles or metal tiles to the construction site of the Del Rosarios' home, and (b) undertook and completed the installation thereof. These they did in bad faith, using inferior materials and assembling them in a manner contrary to MFC's express representations in its brochures and advertisements circulated and broadcast to the general public — which representations had, in the first place, induced the Del Rosarios to choose the metal tiles in question for their roofing. In fine, since MFC, in bad faith and with gross negligence, infringed the express warranty made by it to the general public in connection with the "Banawe" tiles brought to and set up in the house of the Del Rosarios who had relied on the warranty, and thereby caused them considerable injury, the identity of the individual who actually dealt with MFC and asked the latter to make such delivery and installation is of little moment.

That MFC did in truth act with bad faith, in flagrant breach of its express warranties made to the general public and in wanton disregard of the rights of the Del Rosarios who relied on those warranties, is adequately demonstrated by the recorded proofs. The law explicitly authorizes the award of moral damages "in breaches of contract where the defendant acted fraudulently or in bad faith." There being, moreover, satisfactory evidence of the psychological and mental trauma actually suffered by the Del Rosarios, the grant to them of moral damages is warranted. In Makabili v. Court of Appeals, the court held that:

It is essential in the award of damages that the claimant must have satisfactorily proven during the trial the existence of the factual basis of the damages and its causal connection to

defendant's acts. This is so because moral damages though incapable of pecuniary estimation, are in the category of an award designed to compensate the claimant for actual injury suffered and not to impose a penalty on the wrongdoer (Enervida v. De la Torre, 55 SCRA 340 [1974.] and are allowable only when specifically prayed for in the complaint. (San Miguel Brewery, Inc. v. Magno, 21 SCRA 292 [1968])

Raagas vs. Traya

G.R. No. L-20081, February 27, 1968

Facts: Spouses Melquiades Raagas and Adela Laudiano Raagas filed on April 1, 1960, a complaint with the Court of First Instance of Leyte against Octavio Traya, his wife, and Bienvenido Canciller, alleging in essence that on or about April 9, 1958, while the latter was "recklessly" driving a truck owned by his co-defendants, along the public highway in MacArthur, Leyte, the said vehicle ran over the plaintiffs' three-year old son Regino causing his instantaneous death. The plaintiffs ask for actual damages in the sum of P10,000, moral, nominal and corrective damages in a sum to be determined by the court, P1,000 as attorney's fees, P1,000 for expenses of litigation, plus costs.

Defendants specifically denied that Canciller was "driving recklessly" at the time of the mishap, and assert that the truck "was fully loaded and was running at a very low speed and on the right side of the road"; that it was the child who "rushed from an unseen position and bumped the truck so that he was hit by the left rear tire of the said truck and died", and consequently the defendants are not to blame for the accident which was "entirely attributable to an unforeseen event" or due to the fault of the child and negligence of his parents; that the defendant-spouses have exercised due diligence in the selection and supervision of their driver Canciller, whom they hired in 1946 only after a thorough study of his background as a truck driver; and that each time they allowed him to drive it was only after a check of his physical condition and the mechanical fitness of the truck assigned to him.

On June 24 it rendered a judgment on the pleadings, condemning the defendants, jointly and severally, to pay "to the plaintiffs the sum of P10,000 for the death of their child Regino Laudiano Raagas, P2,000 for moral damages, P1,000 actual damages, P1,000 for attorney's fees, and the costs."

On May 4 the plaintiffs' moved for a judgment on the pleadings, upon the claim that the defendants' answer not only "failed to tender an issue" but as well "admitted material allegations" of the complaint.

The court reasoned that the denial in the answer of the charge of reckless driving "did not affect the plaintiffs' positive allegation in their complaint that the truck . . . did not have a current year registration plate . . . for the year 1958 when the accident occurred that "this failure . . . has the effect of admitting hypothetically that they operated ... the said truck without proper license . . . when the accident occurred," and that "unless there is proof to the contrary, it is presumed that a person driving a motor vehicle has been negligent if at the time of the mishap, he was violating any traffic regulation (article 2185, new Civil Code)." The court went on to conclude that under the circumstances a judgment on the pleadings was "irremediably proper and fitting."

Issue: Did the court act correctly in rendering judgment on the pleadings?

Held: No. The plaintiffs' claim for actual, moral, nominal and corrective damages, was controverted by the averment in the answer to the effect that the defendants "have no knowledge or information sufficient to form a belief as to the truth of the allegations" as to such damages, "the truth of the matter being that the death of Regino Raagas was occasioned by an unforeseen event and/or by the fault of the small boy Regino Raagas or his parents." Such averment has the effect of tendering a valid issue.

The court has previously held that we held even if the allegations regarding the amount of damages in the complaint are not specifically denied in the answer, such damages are not deemed admitted. It has also declared in no uncertain terms that actual damages must be proved, and that a court cannot rely on "speculation, conjecture or guesswork" as to the fact and amount of damages, but must depend on actual proof that damage had been suffered and on evidence of the actual amount.

Moreover, in Malonzo vs. Galang et. al., L-13851, July 27, 1960, the court reaffirmed the rule that although an allegation is not necessary in order that moral damages may be awarded, "it is, nevertheless, essential that the claimant satisfactorily prove the existence of the factual basis of the damage and its causal relation to defendant's acts."

There is a need of a full-blown trial on the merits.

Enervida vs. Dela Torre

G.R. No. L-38037 (January 28, 1974)

Facts: Petitioner, Roque Enervida, filed a complaint against the defendant-spouses de la Torre, praying that the deed of sale executed on December 3, 1957 by his deceased father, Ciriaco Enervida, over a parcel of land covered by a Homestead Patent be declared null and void for having been executed within the prohibited period of five years, in violation of Section 118 of Commonwealth Act 141 (Public Land Law) and that he be allowed to repurchase said parcel of land for being the legitimate son and sole heir of his deceased father.

The defendants filed their answer, stating that the plaintiff has no cause of action against them as his father, Ciriaco Enervida, is still living, the petitioner is not only son of Ciriaco Enervida as he has also four other living children and that the sale of the property in question did not take place within the prohibited period provided for in Section 118 of the Public Land Law, the sale having taken place on November 20, 1957, although ratified and acknowledged on December 3, 1957, before a Notary Public.

During the pre-trial conference, petitioner admitted that his father is still living and that he has four other living brothers and sisters who were not joined as party-plaintiffs. He also admitted that the sale of the land in question actually took place on November 20, 1957, but was formalized only on December 3, 1957. He likewise admitted that the homestead patent was issued on November 17, 1952 to his father, which was beyond the prohibited period of 5 years. The CFI ruled that petitioner has no cause of action and was prompted with malice and bad faith in taking his action to court by alleging false statement in his complaint. The court dismissed the case and ordered the petitioner to pay the defendants P2000 as actual moral and exemplary damages and pay also the attorney’s fees. On appeal to Court of Appeals, it certified the case to the Supreme Court for it involved purely question of law.

Issue: Whether or not it is proper to award the defendant an actual moral and exemplary damages when plaintiff filed unfounded civil case.

Held: NO. The Supreme Court ruled that with regard to the award of TWO THOUSAND PESOS "in concept of actual, moral and exemplary damages ...", the same is not proper for it would ran counter to the decision of this Court in Deogracias Malonzo vs Gregoria Galang where it was ruled:

It will be observed that unlike compensatory or actual damages which are generally recoverable in tort cases as long as there is satisfactory proof thereof (Art. 2202), the Code has chosen to enumerate the cases in which moral damages, may be recovered (Art. 2219). A like enumeration is made in regard to the recovery of attorney's fees as an item of damage (Art. 2208). But the two enumerations differ in the case of a clearly unfounded suit, which is expressly mentioned in Art. 2208 (par. 4), as justifying an award of attorney's fees, but is not included in the enumeration of Art. 2219 in respect to moral damages. It is true that Art. 2219 also provides that moral damages may be awarded in "analogous cases" to those enumerated, but we do not think the Code intended" a clearly unfounded civil action or proceedings" to be one of these analogous cases wherein moral damages may be recovered, or it would have expressly mentioned it in Art. 2219, as it did in Art. 2208; or else incorporated Art. 2208 by reference in Art. 2219. Besides, Art. 2219 Specifically mentions "quasi-delicts causing physical injuries", as an instance when moral damages may be allowed, thereby implying that all other quasi-delicts not resulting in physical injuries are excluded (Strebel vs. Figueras, 96 Phil. 321), excepting, of course, the special torts referred to in Art. 309, par. 9, Art. 2219) and in Arts. 21, 26, 27, 28, 29, 30, 32, and 34, 35 on the chapter on human relations (par. 10, Art. 2219).

Furthermore, while no proof of pecuniary loss is necessary in order that moral damages may be awarded, the amount of indemnity being left to the discretion of the court (Art. 2216), it is, nevertheless, essential that the claimant satisfactorily prove the existence of the factual basis of the damage (Art. 2217) and its causal relation to defendant's acts. This is so because moral damages, though incapable of pecuniary estimation, are in the category of an award designed to compensate the claimant for actual injury suffered and not to impose a penalty on the wrongdoer (Algara vs. Sandejas, 27 Phil. 294).

The trial court and the Court of Appeals both seem to be of the opinion that the mere fact that respondent were sued without any legal foundation entitled them to an award of moral damages, hence they made no definite finding as to what the supposed moral damages suffered consist of. Such a conclusion would make of moral damages a penalty, which they are not, rather than a compensation for actual injury suffered, which they are intended to be. Moral damages, in other words, are not corrective or exemplary damages.

People vs. Bugayong

G.R. No. 126518 (December 2, 1998)

Facts: Alberto Cauan and Leticia Yu Cauan got married on May 14, 1978. Out of this marital union they begot 3 children: Albert, Honeylet and Arlene. They separated in 1983. Albert and Arlene stayed with their mother Leticia while Honeylet stayed with her grandmother Anita Yu. Leticia cohabited with the accused Rodelio Bugayong and had one child, Catherine Bugayong.

On October 15, 1994 Bugayong had Arlene hold his penis inside the room he shared with Leticia. At that time, Catherine Bugayong, who was 6 years old was also inside the same room and her father, the accused was letting her sleep. Bugayong threatened to maim Arlene if she did not hold his penis. When the penis was already hard and stiff, he placed it inside the mouth of Arlene and a white substance came out from the penis. Catherine saw this incident.

On the basis of a medico-legal examination conducted by the NBI, and testimonies, Bugayong was convicted. Upon appeal, among other issued involving the defects of the information, he questions the award of PhP50,000.00 in damages ex-delicto in favor of the offended party:

Issue: Does the award damages by the trial court have basis?

Held: The court affirmed his conviction. The trial court correctly awarded P50,000 as indemnity ex delicto, an amount which is automatically granted to the offended party without need of further evidence other than the fact of the commission of rape.

Consistent with recent jurisprudence, appellant should also be ordered to pay the victim the additional amount of P50,000 as moral damages. In People v. Prades, the Court resolved that "moral damages may additionally be awarded to the victim in the criminal proceeding, in such amount as the Court deems just, without the need for pleading or proof of the basis thereof as has heretofore been the practice."

Francisco vs. GSIS

7 SCRA 577 (March 30, 1963)

Facts: Trinidad Francisco, in consideration of a loan in the amount of P400,000.00, mortgaged in favor of the GSIS a parcel of land with twenty-one (21) bungalows, known as Vic-Mari Compound, located at Baesa, Quezon City, payable within ten (10) years in monthly installments and with interest of 7%per annum compounded monthly.

Because of her failure to comply with the mortgaged, GSIS extra-judicially foreclosed the mortgage. GSIS itself was the buyer of the property in theforeclosure sale.

On 20 February 1959, the Trinidad’s father, Atty. Vicente J. Francisco, sent a letter to the general manager of the GSIS offering a compromise that P30,000 which GSIS owes him be credited to Trinidad’s unpaid monthly installments and that GSIS would take over the administration of the mortgaged property and collect all monthly installments amounting to about P5,000 of more than 31 lots and houses until the debt is fully covered. This was approved by GSIS through Andal.

Remittances were made, totaling P698,726.10 sent by Trinidad to GSIS through Andal, all of which were received and duly receipted for. However, GSIS sent 3 letters, all of which were signed by Andal, asking Trinidad for a proposal for the payment of her indebtedness, since according to GSIS the one-year period for redemption had expired.

Atty. Francisco protested against the GSIS’ request for proposal of payment because of the existence of the agreed offer dated 20 February 1959. However, GSIS countered stating that the telegram should be disregarded in view of its failure to express the contents of the board resolution due to the error of its minor employees in couching the correct wording of the telegram which provides that approval of the compromise is “subject to the condition that Mr. Vicente J. Francisco shall pay all expenses incurred by the GSIS in the foreclosure of the mortgage.”

GSIS moved for the consolidated the title to the compound in its name, and gave notice thereof to the plaintiff and to each occupant of the compound. Hence, the plaintiff instituted the present suit, for specific performance and damages.

After trial, the court below found the following:

(a) Declaring null and void the consolidation in the name of the defendant, Government Service Insurance System, of the title of the VIC-MARI Compound; said title shall be restored to the plaintiff; and all payments made by the plaintiff, after her offer had been accepted by the defendant, must be credited as amortizations on her loan; and (b) Ordering the defendant to abide by the terms of the contract created by plaintiff's offer and it's unconditional acceptance, with costs against the defendant.

Both parties appealed. GSIS appealed the decision of declaring null and void the consolidation of the lots, while Trinidad appealed because the trial court did not award the P535,000.00 damages and attorney's fees she claimed.

Issue: Is the lower court correct in not awarding damages to plaintiff?

Held: YES. The court a quo correctly refused to award such actual or compensatory damages because it could not determine with reasonable certainty the difference between the offered price and the actual value of the property, for lack of competent evidence. Without proof we cannot assume, or take judicial notice, as suggested by the plaintiff, that the practice of lending institutions in the country is to give out as loan 60% of the actual value of the collateral.

There was no error also denying moral damages, not only on account of the plaintiff's failure to take the witness stand and testify to her social humiliation, wounded feelings, anxiety, etc., as the decision holds, but primarily because a breach of contract like that of defendant, not being malicious or fraudulent, does not warrant the award of moral damages under Article 2220 of the Civil Code.

There is also no basis for awarding exemplary damages either, because this species of damages is only allowed in addition to moral, temperate, liquidated, or compensatory damages, none of which have been allowed in this case.

As to attorneys' fees, we agree with the trial court's stand that, in view of the absence of gross and evident bad faith in defendant's refusal to satisfy the plaintiff's claim, and there being none of the other grounds enumerated in Article 2208 of the Civil Code, such absence precludes a recovery. The award of attorneys' fees is essentially discretionary in the trial court, and no abuse of discretion has been shown.

Expertravel & Tours, Inc. vs. Court Of Appeals

309 SCRA 141 (June 25, 1999)

Facts: On 07 October 1987, Expertravel& Tours, Inc., ("Expertravel"), a domestic corporation engaged in the travel agency business, issued to private respondent Ricardo Lo four round- trip plane tickets for Hongkong, together with hotel accommodations and transfers, for a total cost of P39,677.20. Alleging that Lo had failed to pay the amount due, Expertravel caused several demands to be made. Since the demands were ignored by Lo, Expertravel filed a court complaint for recovery of the amount claimed plus damages.

Respondent Lo explained, in his answer, that his account with Expertravel had already been fully paid. The outstanding account was remitted to Expertravel through its then Chairperson, Ms. Ma. Rocio de Vega, who was theretofore authorized to deal with the clients of Expertravel. The payment was evidenced by a Monte de Piedad Check for P42,175.20 for which Ms. de Vega, in turn, issued City Trust Check No. 417920 in favor of Expertravel for the amount of P50,000.00, with the notation "placement advance for Ricardo Lo, etc." Per its own invoice, Expertravel received the sum on 10 October 1987.

The trial court, affirmed by the appellate court, held that the payment made by Lo was valid awarding moral damages, attorney’s fees and cost of the suit in favor of Lo. Hence, this petition.

Issue: Can moral damages be recovered in a clearly unfounded suit? Can moral damages be awarded for negligence or quasi-delict that did not result to physical injury to the offended party?

Held: NO. Although the institution of a clearly unfounded civil suit can at times be a legal justification for an award of attorney's fees, such filing, however, has almost invariably been held not to be a ground for an award of moral damages. The rationale for the rule is that the law could not have meant to impose a penalty on the right to litigate. The anguish suffered by a person for having been made a defendant in a civil suit would be no different from the usual worry and anxiety suffered by anyone who is haled to court, a situation that cannot by itself be a cogent reason for the award of moral damages. If the rule were otherwise, then moral damages must every time be awarded in favor of the prevailing defendant against an unsuccessful plaintiff.

NO. An award of moral damages would require certain conditions to be met; to wit: (1) First, there must be an injury, whether physical, mental or psychological, clearly sustained by the claimant; (2) second, there must be a culpable act or omission factually established; (3) third, the wrongful act or omission of the defendant is the proximate cause of the injury sustained by the claimant; and (4) fourth, the award of damages is predicated on any of the cases stated in Article 2219.Under the provisions of this law, in culpa contractual or breach of contract, moral damages may be recovered when the defendant acted in bad faith or was guilty of gross negligence (amounting to bad faith) or in wanton disregard of his contractual obligation and, exceptionally, when the act of breach of contract itself is constitutive of tort resulting in physical injuries. By special rule in Article 1764, in relation to Article 2206, of the Civil Code, moral damages may also be awarded in case the death of a passenger results from a breach of carriage.

In culpa aquiliana, or quasi-delict, (a) when an act or omission causes physical injuries, or (b) where the defendant is guilty of intentional tort, moral damages may aptly be recovered. This rule also applies, as aforestated, to contracts when breached by tort. In culpa criminal, moral damages could be lawfully due when the accused is found guilty of physical injuries, lascivious acts, adultery or concubinage, illegal or arbitrary detention, illegal arrest, illegal search, or defamation. Malicious prosecution can also give rise to a claim for moral damages. The term "analogous cases," referred to in Article 2219, following the ejusdem generis rule, must be held similar to those expressly enumerated by the law.

Unfounded suits

Editha and Glicerio Mijares vs. CA and Metro Drug, Inc.

G.R. No. 113558 (April 18, 1997)

Facts: Petitioners Editha Mijares and Glicerio T. Mijares owners of Aklan Drug had been buying pharmaceutical products from private respondent Metro Drug since 1976. Editha Mijares, aside from being the operator of Aklan Drug, was also an officer of the Ospital Ng Maynila Consumers Cooperative, a concessionaire of a small area right inside the hospital compound where it operated a drugstore. The Ospital ng Maynila Cooperative also had some transactions with Metro Drug as supplier of pharmaceutical products. Subsequently, the Cooperative was dissolved and stopped its operations in October 1986.

On November 1, 1986, a Contract of Lease was entered into between the City of Manila as lessor and Solomon Silverio, Jr. as lessee. Silverio, Jr. as the new lessee, put up a drugstore on the same area occupied by the Cooperative. On November 26, 1986, Metro Drug delivered pharmaceutical products to the said store thru Dioscoro Lamenta, its salesman/collector. More deliveries of pharmaceutical products were made in the same place by Metro Drug, the total value of which amounted to P32,034.42. In partial payment of these receivables, a check was drawn by Silverio, Jr. under the account name Farmacia delos Remedios amounting to P14,180.46. The check however was subsequently dishonored due to insufficient funds.

Metro Drug filed a telegram addressed to Aklan Drug demanding full payment of outstanding account for P27,938.06. Lamenta tried to collect from Editha Mijares for the disputed claim, but Editha referred him to Mr. Silverio as the new operator and concessionaire of the drugstore. She informed him verbally that they have no more business inside the Ospital ng Maynila as the cooperative drugstore has already stopped operations. Despite said verbal notice, the demand telegram addressed to Aklan Drug was still sent to Editha Mijares. On Lamenta's follow-up of said telegram, Editha again directed Lamenta to see Solomon Silverio, the new owner of the drugstore.

Thereafter, Metro Drug filed before the Regional Trial Court of Manila a complaint for a sum of money against petitioners Editha Mijares and Glicerio T. Mijares. Petitioners in their "Answer with Compulsory Counterclaim," denied Metro Drug's allegations and interposed a counterclaim for malicious prosecution and prayed for moral damages, attorney’s fees and expenses of suit.

The RTC concluded that the Mijareses were not the owners of said drugstore when the deliveries were made and the absence of any privity of relations between the parties at the time of the deliveries precludes any cause of action in favor of Metro Drug against the Mijareses. Thus, the RTC dismissed the complaint and ordered Metro Drug to pay the petitioners P30,000.00 for moral damages, P10,000.00 as attorney's fees and the costs of suit. The Court of Appeals however reversed the decision of the RTC.

Issue: Whether the award of moral damages in favor of the Mijareses was proper.

Held: No. The Mijareses have failed to show that Metro Drug was motivated by bad faith when it instituted the action for collection. In China Banking Corporation vs. Court of Appeals, we held that:

x x x Malicious prosecution, both in criminal and civil cases, requires the presence of two elements, to wit: a) malice; and b) absence of probable cause. Moreover, there must be proof t hat the prosecution was prompted by a sinister design to vex and humiliate a person, and that it was initiated deliberately knowing that the charge was false and baseless (Manila Gas Corporation vs. Court of Appeals, 100 SCRA 602 [1980]). Hence, mere filing of a suit does not render a person liable for malicious prosecution should he be unsuccessful, for the law c ould not have meant to impose a penalty on the right to litigate (Ponce v. Legaspi, 208 SCRA 377 [1992]; Saba v. Court of Appeals, 189 SCRA 50 [1990]); Rubio v. Court of Appeals, 141 SCRA 488 [1986]). Settled in our jurisprudence is the rule that moral damages cannot be recovered from a person who has filed a complaint against another in good faith, or without malice or bad faith (Philippine National Bank v. Court of Appeals, 159 SCRA 433 [1988]; R & B Surety and Insurance v. Intermediate Appellate Court, 129 SCRA 736 [1984]). If damage results from the filing of the complaint, it is damnum absque injuria (Ilocos Norte Electrical Company v. Court of Appeals, 179 SCRA 5 [1989]).

For the same reasons, the award for attorney's fees and expenses of litigation must likewise be deleted.

De la Pena vs. Court of Appeals

G.R. No. 81827 (March 28, 1994)

Facts: Ciriaco Reducto was occupying a 24 hectare parcel of land in Davao Del Norte for which he filed a Homestead Application. At the same time, a certain Potenciano Nazaret likewise filed an application for the same lot.

Reducto later transferred his possessory right over the 6 hectares of the lot to petitioner Pantaleon de la Pena. After it was ascertained in a field verification that de la Pena had a better right to acquire the portion claimed by him being its actual occupant and cultivator, the Director of Lands directed de la Pena to apply for the portion himself within sixty (60) days after its survey or else "lose his preferential right thereto." However, no such application was filed.

Meanwhile, Ciriaco transferred his rights over another 1 ½ hectare portion of the lot to Michael Doble who in turn sold his rights to Ricardo Tan (private respondent’s father).

When a survey of the lot was conducted, it was found out that the lands occupied by de la Pena was bigger by ¾ hectare than what he actually bought and paid for from Ciriaco and the land sold to Doble’s (later acquired by Tan) was very much smaller than what he actually bought. Although the 3/4-hectare portion was part of the area acquired by Doble, it was de la Peña who cultivated the same without objection from Doble. However, when Ricardo Tan acquired the lot, he built a fence to reclaim the portion, but de la Pena kept destroying it; hence, the start of a boundary dispute.

On April 1977, de la Pena then filed a complaint for forcible entry against Tan. The MTC which ruled in favor of de la Pena concluded that de la Pena had prior possession of the land. The decision was affirmed by the CFI.

On July 1977, during the pendency of the forcible entry case, de la Pena instituted the present action for reconveyance with damages against Tan with the RTC. De la Pena alleged that Tan fraudulently registered the ¾ hectare portion which was actually cultivated by the former. The trial court ruled in favor of the Tan since the disputed ¾ hectare portion was not part of the area bought and paid for by de la Pena. De la Pena was declared a mere trespasser and planter in bad faith. His prayer for damages was likewise denied. Court of Appeals affirmed the decision of the lower court, hence this petition.

Issue: Whether or not the award for attorney's fees, moral damages and expenses of litigation against the petitioner are proper.

Held: It is well-settled that reconveyance is a remedy granted only to the owner of the property alleged to be erroneously titled in another's name. In the case at bench, de la Pena does not claim to be the owner of the disputed portion. Admittedly, what he has is only a "preferential right" to acquire ownership thereof by virtue of his actual occupation since January 1947. However, de la Pena's possession is not one that could ripen into ownership. Title to alienable public lands can be established through open, continuous, and exclusive possession for at least thirty (30) years. It must be noted that the dispute regarding the 3/4-hectare portion started even before a free patent and OCT could be issued to private respondent in 1975. As early as 1956, the controversy already began between de la Pena and Tan's father. Hence,petitioner's possession falls short of the required period. Not being the owner, de la Pena cannot maintain the present suit.

An award for attorney's fees and moral damages on the sole basis of an action later declared to be unfounded in the absence of a deliberate intent to cause prejudice to the other party is improper. The right to litigate is so precious that penalty should not be charged on those who may exercise it erroneously.

J Marketing vs. Sia

285 SCRA 580 (January 29, 1998)

Facts: J Marketing, herein petitioner, a company engaged in the business of appliances and motorcycles, received on April 24, 1983 from Kawasaki Motors (Phils.) a brand new Kawasaki motorcycle, color Blue, Mode HD-11 (1985) with Engine No. G7E-04848 and Chassis No.KG-805535. Upon receipt, petitioner’s representative placed motorcycle in the bodega of YKS Bldg.. However, petitioner found out that the motorcycle unit was missing in the bodega and the loss immediately reported to the police authorities specifically to the Headquarters Constabulary Highway Patrol District. Petitioner upon tracing found the motorcycle in possession of FelicidadSia Jr., herein respondent, who bought a motorcycle from one Renato Pelande, Jr.

Petitioner’s representative went to the house of the private respondent and examined the chassis and motor numbers of the motorcycle and found out that the chassis and motor numbers of the motorcycle in private respondent’s possession have been tampered to jibe with the chassis and motor numbers of the motorcycle unit previously purchased by Renato Pelande, Jr. from petitioner. When petitioner’s representative confronted private respondent at the Constabulary Highway Patrol Group office anent the questionable motorcycle, private respondent refused to return the said motorcycle to petitioner and instead told petitioner’s representative to file a case in court. Hence, petitioner filed a complaint for replevin with damages against private respondent Felicidad C. Sia, Jr. before the Regional Trial Court of Tacloban City, Branch 8.

Private respondent filed a third party complaint against Renato Pelande Jr., Said third party complaint was declared in default.

After trial, the lower court rendered a decision dismissing petitioner’s complaint but awarded damages and attorney’s fees to private respondent. On appeal, the CA affirmed the decision of the court a quo.Hence this petition.

Issue: Whether the award of damages and attorney’s fee is proper?

Facts: Petitioner State Investment Trust, Inc. (SITI) extended loans in various amounts to Guevent Industrial Development Corp., (GIDC). However, GIDC failed to pay on the dates the loans became due. For this reason, GIDC agreed to mortgage several parcels of land to SITI. When GIDC again defaulted, SITI foreclosed the mortgages and it acquired the properties as the highest bidder.

Thereafter, GIDC filed a case alleging that there were irregularities in the foreclosure of the mortgages. The case was eventually settled through a compromise agreement. A dispute later arose concerning the interpretation of the said agreement, as Honeycomb Builders, Inc. (HBI) offered to purchase from GIDC the lot covered by the agreement and the latter agreed but SITI as mortgagee refused to give its consent to the sale. The trial court directed SITI to accept the offer of HBI. On appeal, the Court of Appeals affirmed the same

Meanwhile, respondent HBI applied to the Housing and Land Use Regulatory Board (HLURB) for a permit to develop the property in question. Its application was granted, on account of which respondent HBI built a condominium on the property. When respondent HBI applied for a license to sell the condominium units it was required by the HLURB to submit an Affidavit of Undertaking which in effect stated that the mortgagee (SITI) of the said property to be developed agrees to release the mortgage on the said property as soon as the full purchase price of the same is paid by the buyer. Respondent HBI submitted the required affidavit purportedly executed by Cometa as president of SITI (mortgagee).

Petitioner Cometa denied that he ever executed the affidavit. The National Bureau of Investigation (NBI) found Cometa's signature to be forgery on the basis of which a

complaint for falsification of public document was filed against HBI president Guevara. However, the Rizal Provincial Prosecutor's Office found no probable cause against Guevara and accordingly dismissed the complaint.

On appeal, Secretary Drilon reversed the decision of the prosecutor and ordered it to file information against Guevara. The trial court dismissed the criminal case. Thereafter, Guevara and HBI file a complaint for malicious prosecution against Cometa and SITI.

Issue: Whether or not the case for malicious prosecution states a cause of action.

Held: A complaint for malicious prosecution sates a cause of action if it alleges that (1) the defendant was himself the prosecutor or that at leas he instigated the prosecution; (2) the prosecution finally terminated in the plaintiff's acquittal; (3) that in bringing the action the prosecutor acted without probable cause; and (4) that the prosecutor was actuated by malice, i.e. by improper and sinister motives.

The mere allegation in a complaint for malicious prosecution that an information was filed after preliminary investigation and that a warrant of arrest was there after issued does not by itself negate allegations in the same complaint that the prosecution was malicious. All criminal prosecutions are by direction and control of the public prosecutor. To sustain petitioners' stand that an allegation in a complaint for malicious prosecution that the information in the criminal case was filed after appropriate preliminary investigation negates a contrary allegation that the filing of the case was malicious would result in the dismissal of every action for malicious prosecution.

Triple Eight Integrated Services, Inc vs. NLRC

299 SCRA 608 (December 3, 1998)

Facts: In August 1992, private respondent Osdana was recruited by petitioner for employment with the latter’s principal, Gulf Catering Company (GCC), a firm based in the Kingdom of Saudi Arabia. Under the original employment contract, Osdana was engaged to work as “Food Server” for a period of thirty-six (36) months with a salary of five hundred fifty Saudi Rials.

Osdana claims she was required by petitioner to pay a total of P11,950.00 in placement fees and other charges, for which no receipt was issued. She was likewise asked to undergo a medical examination conducted by the Philippine Medical Tests System, a duly accredited clinic for overseas workers, which found her to be “Fit of Employment.”

Petitioner asked Osdana to sign another “Contractor. Employee Agreement” which provided that she would be employed as a waitress for twelve (12) months with a salary of two hundred eighty US dollars ($280). It was this employment agreement which was approved by the Philippine Overseas Employment Administration(POEA).

Osdana left for Riyadh, Saudi Arabia, and commenced working for GCC. She was assigned to the College of Public Administration of the Oleysha University and, contrary to the terms and conditions of the employment contract, was made to wash dishes, cooking pots, and utensils, perform janitorial work and other tasks which were unrelated to her job designation as waitress. She was made to work a gruelling twelve-hour shift, without overtime pay.

Osdana suffered from numbness and pain in her arms. The pain was such that she had to be confined at a housing facility of GCC from June 18 to August 22, 1993, during which period, she was not paid her salaries.

Osdana was allowed to resume work, this time as Food Server and Cook at the Hota Bani Tameem Hospital, where she worked seven days a week from August 22 to October 5, 1993. Again, she was not compensated. Then, from October 6 to October 23, 1993, Osdana was again confined for no apparent reason. During this period, she was still not paid her salary.

On October 24, 1993, she was re-assigned to the Oleysha University to wash dishes and do other menial tasks. Osdana worked long hours and under harsh conditions. She was diagnosed as having Bilateral Carpal Tunnel Syndrome, a condition precipitated by activities requiring “repeated flexion, pronation, and supination of the wrist and characterized by excruciating pain and numbness in the arms.”

Osdana underwent two surgical operations. Between these operations, she was not given any work assignments even if she was willing and able to do lightwork in accordance with her doctor’s advice. Again, Osdana was not paid any compensation for the period between February to April 22, 1994.

Osdana was discharged from the hospital on April 25,1994. The medical report stated that “she had very good improvement of the symptoms and she was discharged on the second day of the operation.” Four days later, however, she was dismissed from work, allegedly on the ground of illness. She was not given any separation pay nor was she paid her salaries for the periods when she was not allowed to work.

Upon her return to the Philippines, Osdana sought the help of petitioner, but to no avail. She was thus constrained to file a complaint before the POEA.

ISSUES: Whether or not NLRC committed grave abuse of discretion for the following reasons: (a) ruling in favor of Osdana even if there was no factual or legal basis for the award; and

(b) holding petitioner solely liable for her claims despite the fact that its liability is joint and several with its principal, GCC.

HELD: The decisions of both the labor arbiter and the NLRC were based mainly on the facts and allegations in Osdana’s position paper and supporting documents. We find these sufficient to constitute substantial evidence to support the questioned decisions.

Generally, findings of facts of quasi-judicial agencies like the NLRC are accorded great respect and, at times, even finality if supported by substantial evidence. This Court, therefore, upholds the finding of herein public respondents that the facts and the evidence on record adduced by Osdana and taken in relation to the answer of petitioner show that indeed there was breach of the employment contract and illegal dismissal committed by petitioner’s principal.

Article 284 of the Labor Code is clear on the matter of termination by reason of disease or illness, viz:

Art. 284. Disease as a ground for termination – An employer may terminate the services of an employee who has been found to be suffering from any disease and whose continued employment is prohibited bylaw or prejudicial to his health as well as the health of his co-employees: x x x

Specifically, Section 8, Rule 1, Book VI of the Omnibus Rules Implementing the Labor Code provides:

Sec. 8. Disease as a ground for dismissal – Where the employee suffers from a disease and his continued employment is prohibited by law or prejudicial to his health or to the health of his co-employees, the employer shall not terminate his employment unless there is a certification by competent public authority that the disease is of such nature or at such a stage that it cannot be cured within a period of six (6) months with proper medical treatment. If the disease or ailment can be cured within the period, the employer shall not terminate the employee but shall ask the employeeto take a leave. The employer shall reinstate such employee to his former position immediately upon the restoration of his normal health.

Viewed in the light of the foregoing provisions, the manner by which Osdana was terminated was clearly in violation of the Labor Code and its implementing rules and regulations. Osdana’s continued employment despite her illness was not prohibited by law nor was it prejudicial to her health, as well as that of her co-employees.

In fact, the medical report issued after her second operation stated that “she had very good improvement of the symptoms.” Besides, “Carpal Tunnel Syndrome” is not a contagious disease.

Petitioner has not presented any medical certificate or similar document from a competent public health authority in support of its claims. If, indeed, Osdana was physically unfit to continue her employment, her employer could have easily obtained a certification to that effect from a competent public health authority in Saudi Arabia, thereby heading off any complaint for illegal dismissal. The requirement for a medical certificate under Article 284 of the Labor Code cannot be dispensed with; otherwise, it would sanction the unilateral and arbitrary determination by the employer of the gravity or extent of the employee’s illness and thus defeat the public policy on the protection of labor.

As regards the monetary award of salaries for the unexpired portion of the employment contract, unpaid salaries and salary differential granted by public respondents to Osdana, petitioner assails the same for being contrary to law, evidence and existing jurisprudence, all of which therefore constitutes grave abuse of discretion.

Although this contention is without merit, the award for salaries for the unexpired portion of the contract must, however, be reduced. Paragraph 5, Section 10 of R.A. No. 8042, applies in this case, thus:

“In case of termination of overseas employment without just, valid or authorized cause as defined by law or contract, the worker shall be entitled to the full reimbursement of his placement fee with interest at twelve percent (12%) per annum, plus his salaries for the unexpired portion of his employment contract or for three (3) months for every year of the unexpired term, whichever is less.”

While it would appear that the employment contract approved by the POEA was only for a period of twelvemonths, Osdana’s actual stint with the foreign principal lasted for one year and seven-and-a-half months. It may be inferred, therefore, that the employer renewed her employment contract for another year. Thus, the award for the unexpired portion of the contract should have been US$1,260 (US$280 x 4 ½ months) or its equivalent in Philippine pesos, not US$2,499 as adjudged by the labor arbiter and affirmed by the NLRC.

As for the award for unpaid salaries and differential amounting to US$1,076 representing seven months’ unpaid salaries and one month underpaid salary, the same is proper because, as correctly pointed out by Osdana, the “no work, no pay” rule relied upon by petitioner does not apply in this case. In the first place,the fact that she had not worked from June 18 to August 22, 1993 and then from January 24 to April 29,1994, was due to her illness which was clearly work-related. Second, from August 23 to October 5, 1993,Osdana actually worked as food server and cook for seven days a week at the Hota Bani Tameem Hospital, but was not paid any salary for the said period. Finally, from October 6 to October 23, 1993, she was confined to quarters and was not given any work for no reason at all.

With respect to the award of moral and exemplary damages, the same is likewise proper but should be reduced. Worth reiterating is the rule that moral damages are recoverable where the dismissal of the employee was attended by bad faith or fraud or constituted an act oppressive to labor, or was done in amanner contrary to morals, good customs, or public policy. Likewise, exemplary damages may be awarded if the dismissal was effected in a wanton, oppressive or malevolent manner.

Finally, petitioner alleges grave abuse of discretion on the part of public respondents for holding it solely liable for the claims of Osdana despite the fact that its liability with the principal is joint and several. Petitioner misunderstands the decision in question. It should be noted that contrary to petitioner’s interpretation, the decision of the labor arbiter which was affirmed by the NLRC did not really. Petitioner was the only one held liable for Osdana’s monetary claims because it was the only respondent named in the complaint and it does not appear that petitioner took steps to have its principal included as co-respondent. Thus, the POEA, and later the labor arbiter, did not acquire jurisdiction over the foreign principal.

People of the Philippines vs. Pirame

G.R. No. 121998 (March 9, 2000)

Facts: Teodorico Cleopas and Florencio Pirame were both convicted by the trial court for murder, the eye-witness Cipriano Supero saw them killing one Pedro Torrenueva by hitting him with iron pipe while being held by the accused Florencio Pirame. The trial court ordered to indemnify the surviving spouse of the deceased victim Pedro Torrenueva in the amount of P50,000.00 each and the amount of P23,214.00 representing burial and incidental expenses and P50,000 representing moral and exemplary damages and in all instances without subsidiary imprisonment in case of insolvency. Pirame appealed the trial court’s decision denying his participation in the crime and alleging that the evidence against him was weak to begin with as the eye-witness’ testimony was unbelievable, improbable and unreliable, as he claims that Supero’s testimony were inconsistent and that he only volunteered to testify two months after the crime. And so the case was elevated to the Supreme Court.

Issue: Whether or not the trial court erred regarding the conviction and awarding of damages

Held: The Supreme Court upheld the decision of the trial court. Although there may be inconsistencies on minor details, the same do not impair the credibility of the witnesses where there is consistency in relating the principal occurrence and positive identification of the assailants. Slight contradictions in fact even serve to strengthen the sincerity of the witness and prove that his testimony is not rehearsed. They are safeguards against memorized perjury. As to the delay, it was a result of the fear that was instilled upon him upon seeing the killing with his own eyes.

Regarding the amount of the damages awarded, the order to pay the widow of the victim P50,000.00 as civil indemnity and P23,214.00 as actual damages, as well as the costs was AFFIRMED, but the award of P50,000.00 as moral and exemplary damages was DELETED, there being no legal and factual basis. The award of P50,000.00 from each accused as moral and exemplary damages, however, is unsupported. The widow of the victim did not testify on any mental anguish or emotional distress, which she suffered as a result of her husband's death. The absence of any generic aggravating circumstance attending the crime likewise disqualified the award of exemplary damages. The attendance of evident premeditation in the commission of the crime, though alleged in the information, is not supported by the evidence, as there is no showing as to when appellant and his co-accused determined to kill the victim. Likewise, abuse of superior strength, being absorbed by treachery, cannot be considered as an aggravating circumstance in this case.

Arcona vs. Court of Appeals

G.R. No. 134784 (December 9, 2002)

Facts: In the evening of June 27, 1986, Napoleon Ong and Edgardo Talanquines were walking along the national highway at Barangay Labog, Brooke’s Point, Palawan, on their way home after coming from a birthday party. When they were near the house of Jerry Boston, Edgardo heard a loud thud. He turned around saw Napoleon slump to the ground. Suddenly, someone hit Edgardo from behind with a piece of bamboo, causing him to fall. He saw no one in the immediate premises except Carlos Arcona, the petitioner. Edgardo then stood up and ran towards the house of Cesar Umapas to ask for help.

Petitioner voluntarily surrendered. In his defense, petitioner alleged that in the evening of June 27, 1986, he was walking alone when he met Napoleon Ong and Edgardo Talanquines. Without any provocation, Napoleon suddenly drew his bolo and swung the bolo at him twice but missed him. He then drew out his knife and stabbed Napoleon. When he saw Edgardo Talanquines rushing towards him, he grabbed a piece of bamboo from the newly constructed culvert and hit the former on the left arm. Talanquines ran away. Petitioner also left the premises and went home. On the way, he met his brother, Benito, and together they proceeded to their house. After trial, the court a quo rendered judgment convicting Carlos of Homicide and acquitting Benito Arcona and ordered that the former pay the amount of 30,000 pesos for the death of Napoleon Ong and 10,000 pesos moral damages. For the charge of Slight Physical Injuries Benito Arcona was found guilty and Carlos was acquitted. On appeal, the Court affirmed the decision of the lower court but increased the civil indemnity to the heirs of Napoleon Ong to 50,000 pesos.

Petitioner Carlos Arcona y Moban and his brother Benito Arcona y Moban were charged with Murder and Frustrated Murder in separate informations. The charges arose from the death of Napoleon Ong after he was attacked and stabbed by Carlos and Benito Arcona y Moban.

Issue: Whether or not the Court of Appeals was correct in increasing the civil indemnity due to the heirs of Napoleon Ong.

Held: Yes. The Court of Appeals was correct in increasing the amount of civil indemnity to P50,000.00, in line with existing jurisprudence. In cases of murder, homicide, parricide and rape, civil indemnity in the amount of P50,000.00 is automatically granted to the offended party or his heirs in case of his death, without need of further evidence other than the fact of the commission of the crime.

On the other hand, the award of moral damages in the sum of P 10,000.00 must be increased to P50,000.00. As borne out by human nature and experience, a violent death invariably and necessarily brings about emotional pain and anguish on the part of the victim’s family. It is inherently human to suffer sorrow, torment, pain and anger when a loved one becomes the victim of a violent or brutal killing. Such violent death or brutal killing not only steals from the family of the deceased his precious life, deprives them forever of his love, affection and support, but often leaves them with the gnawing feeling that an injustice has been done to them. For this reason, moral damages must be awarded even in the absence of any allegation and proof of the heirs’ emotional suffering.

Factors in determining amount

Philippine National Bank vs. Court of Appeals

G.R. No. 116181 (April 17, 1996)

Facts: Carmelo H. Flores (Flores) purchased from petitioner at its Manila Pavilion Hotel unit, two (2) manager's checks worth P500,000.00 each. A receipt for said amount was issued by the petitioner. Subsequently, Flores presented these checks at the Baguio Hyatt Casino unit of petitioner. Petitioner refused to encash the checks but after a lengthy discussion, it agreed to encash one (1) of the checks. However, it deferred the payment of the other check until after Flores agreed that it be broken down to five (5) manager's checks of P100,000.00 each. Furthermore, petitioner refused to encash one of the five checks until after it is cleared by the Manila Pavilion Hotel unit. Having no other option, Flores agreed to such an arrangement. However, upon his return to Manila, he made representations to PNB through its Malate Branch so that the check may be encashed but to no avail. Flores, thereafter, wrote a letter to his

counsel informing the latter of the aforementioned events. A Formal Demand was made by private respondent's counsel but petitioner persisted in its refusal to honor the check. Left with no other choice, Flores filed a case with the Regional Trial Court which ruled in his favor ordering PNB, among others, to pay the amount of the checks dishonored plus moral damages in the amount of 1,000,000.00 pesos. The same was affirmed by the Court of Appeals.

Issue: Whether or not the award of P1,000,000.00 moral damages in addition to actual claim of inordinately disproportionate and unconscionable

Held: YES. We concur with the findings of the trial court and the Court of Appeals as to the award of moral damages, however the amount of P1,000,000.00 for moral damages in addition to Flores' actual claim of P100,000.00 is "inordinately disproportionate and unconscionable." The following factors were taken into consideration:

First, Flores' contention that he lost the opportunity to purchase a house and lot in Baguio City due to petitioner's gross negligence is based solely on his own testimony and a mere general statement at that. The broker he named during his cross-examination, Mr. Nick Buendia was not even presented to confirm the aforementioned allegation.

Second, the award of moral damages in the amount of P1,000,000.00 is obviously not proportionate to the actual losses of P100,000.00 sustained by Flores. The moral damages awarded must be commensurate with the loss or injury suffered. Moral damages though incapable of pecuniary estimations, are in the category of an award designed to compensate the claimant for actual injury suffered and not to impose a penalty on the wrongdoer. It is not intended to enrich a complainant at the expense of the defendant. They are awarded only to enable the injured party to obtain means, diversion or amusements that will serve to obviate the moral suffering he has undergone, by reason of the defendant's culpable action. Its award is aimed at the restoration, within the limits of the possible, of the spiritual status quo ante, and it must be proportional to the suffering inflicted.

Gregorio Fule vs. Court of Appeals

G.R. No. 112212 (March 2, 1998)

Facts: Gregorio Fule, a corporate secretary of Rural Bank of Alaminos and also a jeweler on the side, acquired a 10-hectare property in Tanay, Rizal. The property used to be under the name of Fr. Antonio Jacobe. Fr. Jacobe had mortgaged it earlier to the Rural Bank of Alaminos to secure a loan, but the mortgage was later foreclosed and the property was offered for public auction.

Fule, as corporate secretary of the bank, asked Remelia Dichoso and Oliva Mendoza to look for a buyer who might be interested in the Tanay property. The two found a buyer in private respondent Dr. Ninevetch Cruz. At the same time, it so happened that Fule had shown interest in buying a pair of emerald-cut diamond earrings owned by Dr. Cruz. Subsequently, negotiations for the barter of the jewelry and the property ensued. However, it was later on found out that no barter was feasible because the 1-year period of redemption had not yet expired. To get over this legal impediment, Fule executed a deed of redemption on behalf of Fr. Jacobe, the latter purportedly sold the property to Fule.

One day, Fule arrived at Atty. Belarmino’s (private petitioner’s lawyer) residence with Dichoso and Mendoza to execute a deed of absolute sale. Fule issued a certification stating that the actual consideration of the sale was Php200,000.00 and not Php80,000.00 as indicated in the deed. Since the earrings were appraised at only Php160,000.00, the remaining Php40,000.00 was to be paid later in cash. This was done apparently to minimize the capital gains tax which Fule would have to shoulder.

Fule later headed for the bank to meet Cruz and pick up the earrings. There, Dr. Cruz and the bank cashier then opened the safety deposit box. Dr. Cruz retrieved a transparent plastic or cellophane bag with the jewelry inside and handed the same to Fule. The latter took the jewelry from the bag, went near the electric light at the bank’s lobby, held the jewelry against the light and examined it for ten to fifteen minutes. After a while, Dr. Cruz asked, “Okay na ba iyan?” Petitioner expressed his satisfaction by nodding his head. When asked if the jewelry was ok, Fule nodded to express his satisfaction. Fule paid the agents $300 and some pieces of jewelry.

On the evening of the same day, Fule arrived at the residence of Atty. Belarmino complaining that the jewelry given to him, as proven by a tester, was fake. Fule then accused Dichoso and Mendoza of deceiving him which they, however, denied. They countered that Fule could not have been fooled because he had vast experience with jewelry. Nevertheless, Fule took back the $300 and the jewelry he paid them.

Fule filed a complaint before the Regional Trial Court against Cruz and Atty. Bellarmino praying, among other things, that the contract of sale over the Tanay property be declared null and void on the ground of fraud and deceit. The lower court issued a temporary restraining order directing the Register of Deeds of Rizal to refrain from acting on the pertinent documents involved in the transaction. However, the same court lifted its previous order and denied the prayer for a writ of preliminary injunction.

After trial, the lower court rendered its decision in favor of Cruz and Atty. Bellarmino. In awarding damages to the defendants, the lower court found that Fule acted in bad faith. The court awarded Cruz and Atty. Bellarmino moral damages and exemplary damages. The court also granted both P25,000.00 each as attorney’s fees and litigation expenses. A petition with the Court of Appeals yielded the same result, hence this petition.

Issue: Whether or not the appellate court erred in awarding damages.

Held: No. In the instant case, the trial court awarded damages analogous to malicious prosecution under Article 2219(8) of the NCC for the following reasons:

The malice with which Fule filed the case is apparent. As an experienced jeweler who thoroughly examined the earrings himself and went so far as to sketch

them earlier, it is illogical that he would fail to exert extra effort to check its genuineness at the precise moment of the exchange. His acts thus failed to accord with what an ordinary prudent man would have done in the same situation.

As an experienced businessman and banker, he was shrewd enough to bloat the property’s price from Php25,000.00 to Php75,000.00 only a few days after he had purchased it for a far lower cost, the value of which still fell short of the diamond earrings’ price.

Also, it took him 2 hours of unexplained delay before complaining that the earrings were counterfeit—a period in which anything could have happened while Fule was in possession of the jewelry.

Given this, it would appear that the cause of action in the instant case was contrived by Fule himself in hopes of obtaining a favorable outcome in his complaint to take the real jewelry, return a fake, and get back the property. This is plain and simple, unjust enrichment. All that considered the damages prayed for were reasonably proportionate to the sufferings Cruz and Atty. Bellarmino underwent.

Petitioner filed a malicious and unfounded case all the while dragging down private respondents, whose reputations had been soiled by Fule’s coming to court with unclean hands. Because of the falsity, malice and baseless nature of the complaint, Cruz and Atty. Bellarmino were compelled to litigate and are thus also entitled to the awarding of attorney’s fees under Article 2208.

Philippine Airlines vs. Court of Appeals

G.R. No. 120262 (July 17, 1997)

Facts: Pantejo, then City Fiscal of Surigao City, boarded a PAL plane in Manila and disembarked in Cebu City where he was supposed to take his connecting flight to Surigao City However, due to typhoon Osang, the connecting flight to Surigao City was cancelled.

To accommodate the needs of its stranded passengers, PAL initially gave out cash assistance and, the next day for their expected stay of two days in Cebu. Pantejo requested instead that he be billeted in a hotel at PAL's expense because he did not have cash with him at that time, but PAL refused. Thus, respondent Pantejo was forced to seek and accept the generosity of a co-passenger. when the flight for Surigao was resumed, respondent Pantejo came to know that the hotel expenses of his co-passengers, were reimbursed by PAL. At this point, respondent Pantejo informed Oscar Jereza, PAL's Manager for Departure Services at Mactan Airport and who was in charge of cancelled flights, that he was going to sue the airline for discriminating against him. It was only then that Jereza offered to pay respondent Pantejo P300.00 which, due to the ordeal and anguish he had undergone, the latter decline. The Regional Trial Court of Surigao City, rendered judgment in the action for damages filed by Pantejo against Philippine Airlines, Inc., ordering the latter to pay Pantejo among others, P150,000.00 as moral damages. On appeal, respondent court affirmed the decision of the court a quo, but with the exclusion of the award of attorney's fees and litigation expenses.

Issue: WON the award of P 150,000.00 as moral damages was proper.

Held: Yes. Moral damages are emphatically not intended to enrich a plaintiff at the expense of the defendant. They are awarded only to allow the former to obtain means, diversion, or amusements that will serve to alleviate the moral suffering he has undergone due to the defendant's culpable action and must, perforce, be proportional to the suffering inflicted. However, substantial damages do not translate into excessive damages. Under the peculiar circumstances of this case, the awards for actual, moral and exemplary damages granted in the judgment of respondent court, for the reasons meticulously analyzed and thoroughly explained in its decision, are just and equitable.

Valenzuela vs. CA

G.R. No. 115024 (February 7, 1996)

Facts: Ma. Lourdes Valenzuela was driving along Aurora Blvd. when she realized she had a flat tire. She parked along the sidewalk, put on her emergency lights, and opened the car’s trunk. She was at the left side of the rear of her car. While she was talking to a man who will help her fix the tire, she was suddenly bumped by a car driven by defendant Richard Li which was registered in the name of Alexander Commercial, Inc.

Because of the impact, Valenzuela was thrown against the windshield of Li’s car and fell onto the ground. The car’s windshield on the other hand, was also destroyed,. Valenzuela's left leg was severed up to the middle of her thigh, with only some skin and sucle connected to the rest of the body. She was confined in the hospital for 20 days and was eventually fitted with an artificial leg. She then filed a claim for damages against Li.

Li’s alibi was that he was driving at 55kph when he was suddenly confronted with a speeding car coming from the opposite direction. He instinctively swerved to the right to avoid colliding with the oncoming vehicle, and bumped Valenzuela's car. He claimed to not have seen the car due to its midnight blue color. He argued that there was no parking light or an early warning device, and that the area was poorly lighted. Li and Alexander Commercial, Inc. counterclaimed for damages, alleging that Valenzuela was the one who was reckless or negligent. The RTC found Li and Alexander Commercial, Inc. solidarily liable. CA absolved Alexander Commercial, Inc.

Issue: Whether nor not the damages should be mitigated due to the contributory negligence of Valenzuela for parking along Aurora Blvd, which happens to be a no parking zone.

Held: Contributory negligence is a conduct on the part of the injured party, contributing as a legal cause to the harm he has suffered, which falls below the standard to which he is required to conform for his own protection. The "emergency rule," on the other hand, as adopted by this Court in Gan vs. Court of Appeals, is where an individual who suddenly finds himself in a situation of danger and is required to act without much time to consider the best means that may be adopted to avoid the impending danger, is not guilty of negligence if he fails to undertake what subsequently and upon reflection may appear to be a better solution, unless the emergency was brought by his own negligence.

While the emergency rule applies to those cases in which reflective thought or the opportunity to adequately weigh a threatening situation is absent, the conduct which is required of an individual in such cases is dictated not exclusively by the suddenness of the event which absolutely negates thoughtful care, but by the over-all nature of the circumstances. A woman driving a vehicle suddenly crippled by a flat tire on a rainy night will not be faulted for stopping at a point which is both convenient for her to do so and which is not a hazard to other motorists. She is not expected to run the entire boulevard in search for a parking zone or turn on a dark street or alley where she would likely find no one to help her.

As a result of the accident, Valenzuela underwent a traumatic amputation of her left lower extremity at the distal left thigh just above the knee. Because of this, Valenzuela will forever be deprived of the full ambulatory functions of her left extremity, even with the use of state of the art prosthetic technology. Well beyond the period of hospitalization (which was paid for by Li), she will be required to undergo adjustments in her prosthetic devise due to the shrinkage of the stump from the process of healing. The damage done to her would not only be permanent and lasting, it would also be permanently changing and adjusting to the physiologic changes which her body would normally undergo through the years. The replacements, changes, and adjustments will require corresponding adjustive physical and occupational therapy. All of these adjustments, it has been documented, are painful.

The foregoing discussion does not even scratch the surface of the nature of the resulting damage because it would be highly speculative to estimate the amount of psychological pain, damage and injury which goes with the sudden severing of a vital portion of the human body. A prosthetic device, however technologically

advanced, will only allow a reasonable amount of functional restoration of the motor functions of the lower limb. The sensory functions are forever lost. The resultant anxiety, sleeplessness, psychological injury, mental and physical pain are inestimable.

As the amount of moral damages are subject to this Court’s discretion, we are of the opinion that the amount of P1,000,000.00 granted by the trial court is in greater accord with the extent and nature of the injury -physical and psychological - suffered by Valenzuela as a result of Li’s grossly negligent driving of his Mitsubishi Lancer in the early morning hours of the accident.

Aurelio Sumaplong vs. Court of Appeals

G.R. No. 123404 (February 26, 1997)

Facts: Sumalpong shot Ramos after the former slapped Ramos’s wife. Before the incident, the accused called upon the spouses and inquired if they knew the person who stoned his house. During the conversation, Sumalpong accused Ramos of throwing stones at his house. Because of this, Leodarda, the wife of Ramos, remarked that Sumalpong should first confirm the information he received before accusing anyone. after hearing Leonarda’s remark, Sumalpong shot her at the back of her head (though apparently, Leonarda was not harmed). Ramos rushed towards Sumalpong who then shot Ramos twice but missed. They wrestled and in the act, Sumalpong bit on Ramos’ ear, causing its mutilation.

The trial court conviicted Sumalpong of attempted homicide. It awarded Ramos P 16,800.00 for the loss of his crops due to his failure to attend to his farm due to the injuries inflicted upon him by Sumalpong. The court also awarded Ramos P2,000.00 for hospitalization expenses, and P5,000.00 by way of moral damages. On appeal, the CA affirmed Sumalpong’s conviction. It however removed the award for loss of crops and hospitalization expenses, increased moral damages to P10,000.00, and awarded nominal damages in the same amount.

Issue: Whether or not the petitioner is guilty and liable for damages.

Ruling: In view of the foregoing, this Court cannot but concur with the trial court and the Court of Appeals in finding the petitioner guilty beyond reasonable doubt of the crime charged. Anent the award of damages, however, this Court upholds the Court of Appeals' ruling on the matter. Eliminating the award of actual or compensatory damages in the form of hospitalization expenses and loss of income, the Court of Appeals cited the failure of the complainant to offer any proof of the same. To justify a grant of actual or compensatory damages, it is necessary to prove with a reasonable degree of certainty, premised upon competent proof and on the best evidence obtainable by the injured party, the actual amount of loss.

Anent the increase in the amount of moral damages awarded, suffice it to state that the nature of the injuries and the degree of physical suffering endured by the complainant warrants the same. The tragic incident caused a mutilation of complainant's left ear and a permanent scar on his right forearm. These injuries have left indelible marks on the complainant's body and will serve as a constant reminder of this traumatic experience. The Court finds the award of nominal and moral damages both in the amount of P10,000.00 justified under the circumstances.

Lopez vs. Pan-American World Airways

G.R. No. L-22415 (March 30, 1966)

Facts: Sen. Fernando Lopez, his wife, son-in-law, and his daughter made reservations, through their agency, for first class accommodations in the Tokyo – San Francisco flight of PAN-AM. PAN-AM's San Francisco head office confirmed their reservations. Subsaquently, first class tickets were issued, with the total fare

having been previously paid.

As scheduled, they left Manila and as soon as they arrived in Tokyo, they contacted PAN-AM's Tokyo office regarding their accommodations. PAN-AM's Tokyo office informed them that the first class seats were all already booked and that they could not take the flight unless they took the tourist class. Due to pressing engagements in the US, they were constrained to take PAN-AM's flight as tourist passengers.

Sen. Lopez filed a suit for damages alleging breach of contracts done in bad faith by PAN-AM out of racial prejudice against Orientals. He asked for actual and moral damages, exemplary damages, and attorney's fees plus costs. PAN-AM asserted that its failure to provide first class accommodations to Sen. Lopez and his family was due to honest error of its employees.

Issue: Whether or not the award for moral damages and exemplary damages could be increased.

Held: The Court ruled in favor of Sen. Lopez and his family and increased the amounts of moral and exemplary damages.

Moral damages are recoverable in breach of contracts where the defendant acted fraudulently or in bad faith (Art. 2220). While exemplary or corrective damages may be imposed by way of example or correction for the public good in breach of contracts where the defendant acted in a wanton, fraudulent, reckless, oppressive or malevolent manner (Art. 2229, 2232). Written contracts for an attorney's services, on the other hand, shall control the amount to be paid unless found by the court to be unconscionable or unreasonable (Sec. 24, Rule 138, ROC).

Factors in determining amount for moral damages:

The amount of damages awarded in this appeal has been determined by adequately considering the official, political, social, and financial standing of the offended parties on one hand, and the business and financial position of the offender on the other. The present rate of exchange and the terms at which the amount of damages awarded would approximately be in U.S. dollars has also been considered.

MORAL DAMAGES

As a proximate result of PAN-AM’s breach in bad faith of its contracts, Sen. Lopez and his family suffered social humiliation, wounded feelings, serious anxiety and mental anguish. It may not be humiliating to travel as tourist passengers; it is humiliating to be compelled to travel as such, contrary to what is rightfully to be expected from the contractual undertaking.

Sen. Lopez was then Senate President Pro Tempore. International carriers like defendant know the prestige of such an office. For the Senate is not only the Upper Chamber of the Philippine Congress, but the nation's treaty-ratifying body. He was also former Vice-President of the Philippines. Mrs. Maria Lopez, as wife of the Senator, shared his prestige and therefore his humiliation. In addition, she suffered physical discomfort during the 13-hour trip; her reason for going to the US was

actually for medical check-up and relaxation. The fact that the seating spaces in the tourist class are quite narrower than in first class will suffice to show that she indeed experienced physical suffering during the trip. Mr. and Mrs. Alfredo Montelibano, Jr., were travelling as immediate members of the family of Sen. Lopez. Even if they initially wanted to change their seat reservations from first class to tourist class, they eventually paid for first class seats. Hence, they also suffered social humiliation.

EXEMPLARY DAMAGES

In view of its nature, it should be imposed in such an amount as to effectively deter similar breach of contracts in the future by defendant or other airlines.

Producers Bank of the Philippines vs. CA and Spouses Chua

G.R. No. 111584 (September 17, 2001)

Facts: Salvador Chua was originally a depositor of Pacific Banking Corporation. He was offered by the manager of Producers Bank of the Philippines to transfer his account with them. The manager assured Chua that if he was to transfer his account the latter would enjoy longer loan terms and lower interest rates. Chua later on decided to transfer his account to Producers Bank. There, he maintained substantial savings and current deposits with the bank’s Bacolod branch. He also obtained various loans, one of which amounted to P 2,000,000.00 which was secured by a real estate mortgage.

Later on, unfortunate events started to happen to Chua as a client of Producers Bank. The amount which he deposited into his savings account was never credited. It was discovered that the branch manager absconded with the money of the bank’s depositors. The bank also dishonored the checks drawn by Chua on the ground of insufficient funds despite the fact that there was a balance deposit sufficient to cover the amount of the checks.

These events prompted Chua and his wife to request for copies of their ledgers covering their savings and current accounts. However, the bank refused to grant their request. Due to the bank's refusal, the couple instituted an action for damages against the bank. The bank, on the other hand, filed a petition for extrajudicial foreclosure of the real estate mortgage which covered Chua’s previous loan. As a result, spouses Chua’s filed a complaint for injunction and damages, alleging that the petition for extrajudicial foreclosure was without basis and was instituted maliciously in order to harass them. The trial court and the appellate court ruled in favor of Spouses Chua, hence awarding damages.

Issue: Are Spouses Chua entitled to moral, exemplary, and actual damages?

Held: The Court held that Spouses Chua are entitled to moral and exemplary damages. Moral and exemplary damages may be awarded without proof of pecuniary loss. In awarding both, the court shall take into account the circumstances surrounding the case and assess damages according to its discretion.

The dishonor of Chua’s checks and the foreclosure case initiated by the bank against Chua adversely affected his credit standing, as well as his business dealings. Article 2217, in relation to Article 2220, entitles Spouses Chua to moral damages. Obviously, the bank's wrongful acts caused serious anxiety, embarrassment, and humiliation to Chua.

The acts of the bank (the malicious and unwarranted application for extrajudicial foreclosure done by the bank to harass, embarrass, annoy, and ridicule Chua, as well as the bank's failure to credit the deposit of Chua which constituted gross negligence in the performance of the bank’s contractual obligation) were accompanied by bad faith and done in wanton, fraudulent and malevolent manner warranting the award of exemplary damages in favor of Chua, in accordance with Article 2232 of the Civil Code.

Of course, a plaintiff need not prove the actual extent of exemplary damages, for its determination is addressed to the sound discretion of the court upon proof of the plaintiff's entitlement to moral, temperate, or compensatory damages (Article 2234, Civil Code).

Anent the award of actual damages, the injured party must prove his case in order to recover. When the existence of a loss is established, absolute certainty as to its amount is not required. The benefit to be derived from a contract which one of the parties has absolutely failed to perform is of necessity to some extent, a matter of speculation, but the injured party is not to be denied for that reason alone. He must produce the best evidence of which his case is susceptible and if that evidence warrants the inference that he has been damaged by the loss of profits which he might with reasonable certainty have anticipated but for the defendant's wrongful act, he is entitled to recover (Cerreno vs. Tan Chuco, 28 Phil. 312 [1914] quoted in Central Bank of the Philippines vs. Court of Appeals, 63 SCRA 431 [1975]).

Applying the foregoing test to the instant case, the Court finds the evidence of Chua insufficient to be considered within the purview of "best evidence." The bare assertion of Salvador Chua that he lost an average of P18,000.00 per month is inadequate if not speculative and should be admitted with extreme caution since it is not supported by independent evidence. Chua could have presented evidence as reports on the average actual profits earned by their gasoline business, their financial statements, and other evidence of profitability which could aid the court in arriving with reasonable certainty at the amount of profits which private respondents failed to earn. Thus there can be no award of exemplary damages.

Who may recover?

Strebel vs Figueras

96 PHIL 321 (December 29, 1954)

Facts: Emilio Strebel seeks to recover damages against Figueras (acting Secretary of Labor), Jose (Dir. of labor) and Ruperto (Asst. City Fiscal of Manila) alleging as ground, three causes of action:

1. That out of spite against him and his family, defendants used their political influence in attempting to build a drainage through a gasoline station operated by a partnership, to which Strebel is a partner.

2. That defendants, by making use of their official and political connections, was able to induce the Secretary of Justice to transfer one Dr. Hernandez from being an officer of the Bureau of Immigration to that of the Bureau of Prisons. Strebel claims that Dr. Hernandez is his son-in-law, being the husband of his (Strebel’s) step-daughter.

3. Defendants caused the laborers of Strebel’s gasoline station to file false cases against him for violation of a Commonwealth Act prohibiting compulsion of vwork beyond eight (8) hours. While the case was dismissed, Defendants issued a press conference questioning the dismissal besmirching his reputation nonetheless.

Issue: Is plaintiff entitled to damages?

Held: No, on all causes of action. As to the first cause of action, the Supreme Court ruled that the drainage project has not begun, therefore, no damage was suffered by plaintiff.

As to the third cause of action, the court ruled that since no information has been filed by the Fiscal, the charge of malicious prosecution cannot prosper. While plaintiff also maintains that at any case, defendants are liable under their misconduct via tortuous act, the old civil code, which was the law in effect at the time of the commission of the crime, moral damages may not be recovered in cases of crime or tort unless it results from “physical injuries”.

NOTE: FOCUS on this-- As to the second cause of action, Strebel claims that by reason of the malicious transfer of Dr. Hernandez to the Office of the Bureau of Prisons, he has suffered moral and mental suffering and therefore entitled to moral damages. As to the alleged press conference, no mention of the case number of a specific person was made, hence, there could be no damage suffered.

The Supreme Court elucidates "As a general rule, the right of recovery for mental suffering resulting from bodily injuries is restricted to the person who has suffered the bodily hurt, and there can be no recovery for distress caused by sympathy for another's suffering, or for fright due to a wrong against a third person. So the anguish of mind arising as to the safety of others who may be in personal peril from the same cause cannot be taken into consideration” It furthered by saying that “damages are not recoverable for fright or shock even when sustained as result of willful act, unless such act was directed toward person or property or person seeking recovery.”

The rule on this point, as stated in the American Jurisprudence, is: "In law mental anguish is restricted as a rule, to such mental pain or suffering as arises from an injury or wrong to the person himself, as distinguished from that form of mental suffering which is the accompaniment of sympathy or sorrow for another's suffering or which arises from a contemplation of wrongs committed on the person of another. Pursuant to the rule stated, a husband or wife cannot recover for mental suffering caused by his or her sympathy for the other's suffering." It should be noted that plaintiff is not even related to Dr. Hernandez. The latter's wife is a daughter of Mrs. Strebel by a previous marriage. Hence Dr. Hernandez is merely related by affinity, not to Strebel, but to a relative by affinity of said plaintiff.

ABS-CBN vs. Court of Appeals

G.R. No. 128690 (January 29, 1999)

Facts: In 1990, ABS-CBN and Viva executed a Film Exhibition Agreement whereby Viva gave ABS-CBN an exclusive right to exhibit some Viva films. ABS-CBN shall have the right of first refusal to the next twenty-four (24) Viva films for TV telecast under such terms as may be agreed upon by the parties hereto, provided, however, that such right shall be exercised by ABS-CBN from the actual offer in writing.

Viva, through defendant Del Rosario, offered ABS-CBN, through its vice-president Charo Santos-Concio, a list of three(3) film packages (36 title) from which ABS-CBN may exercise its right of first refusal. ABS-CBN, however "can tick off only ten (10) titles" (from the list) "we can purchase" and therefore did not accept said list. Subsequently, Del Rosario approached ABS-CBN's Ms. Concio, with a list consisting of 52 original movie titles (i.e. not yet aired on television) including the 14 titles subject of the present case, as well as 104 re- runs (previously aired on television) from which ABS-CBN may choose another 52 titles, as a total of 156 titles, proposing to sell to ABS-CBN airing rights over this package of 52 originals and 52 re-runs.

Del Rosario and ABS-CBN general manager, Eugenio Lopez III, met at the Tamarind Grill Restaurant in Quezon City to discuss the package proposal of Viva. Mr. Lopez testified that he and Mr. Del Rosario allegedly agreed that ABS-CRN was granted exclusive film rights to fourteen (14) films for a total consideration of P36 million; that he allegedly put this agreement as to the price and number of films in a "napkin'' and signed it and gave it to Mr. Del Rosario.

On the other hand, Del Rosario denied having made any agreement with Lopez regarding the 14 Viva films; denied the existence of a napkin in which Lopez wrote something; and insisted that what he and Lopez discussed at the lunch meeting was Viva's film package offer of 104 films (52 originals and 52 re-runs) for a total price of P60 million. Mr. Lopez promising to make a counter proposal which came in the form of a proposal contract. Thereafter, Del Rosario and Mr. Graciano Gozon discussed the terms and conditions of Viva's offer to sell the 104 films, after the rejection of the same package by ABS-CBN. On April 07, 1992, defendant Del Rosario received through his secretary, a handwritten note from Ms. Concio, which reads: "Here's the draft of the contract. I hope you find everything in order," to which was attached a draft exhibition agreement a counter-proposal covering 53 films, 52 of which came from the list sent by defendant Del Rosario and one film was added by Ms. Concio, for a consideration of P35 million.

The said counter proposal was however rejected by Viva's Board of Directors on the evening of the same day, April 7, 1992, as Viva would not sell anything less than the package of 104 films for P60 million pesos and such rejection was relayed to Ms. Concio. After the rejection of ABS-CBN and following several negotiations and meetings defendant Del Rosario and Viva's President Teresita Cruz, in consideration of P60 million, signed a letter of agreement granting RBS the exclusive right to air 104 Viva-produced and/or acquired films including the fourteen (14) films subject of the present case.

Thereafter, ABS-CBN filed before the RTC a complaint for specific performance with a prayer for a writ of preliminary injunction and/or temporary restraining order against private respondents Republic Broadcasting Corporation, Viva Production and Del Rosario. RTC rendered a decision in favor of RBS and VIVA and against ABS-CBN, ordering the latter to pay, among others, P5 million as and by way of moral damages. On appeal, respondent court found reasonable basis for the award of moral damages holding that RBS's reputation was debased by the filing of the complaint and denied VIVA and Del Rosario's appeal because it was "RBS and not VIVA which was actually prejudiced when the complaint was filed by ABS-CBN."

Issue: Whether or not ABS-CBN is entitled to the award of moral damages.

Held: No. As to moral damages, RBS's claim for moral damages could possibly fall only under item (10) of Article 2219, thereof which reads: “(10) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34, and 35.”

Moral damages are in the category of an award designed to compensate the claimant for actual injury suffered. and not to impose a penalty on the wrongdoer. The award is not meant to enrich the complainant at the expense of the defendant, but to enable the injured party to obtain means, diversion, or amusements that will serve to obviate then moral suffering he has

undergone. It is aimed at the restoration, within the limits of the possible, of the spiritual status quo ante, and should be proportionate to the suffering inflicted. Trial courts must then guard against the award of exorbitant damages; they should exercise balanced restrained and measured objectivity to avoid suspicion that it was due to passion, prejudice, or corruption on the part of the trial court. The award of moral damages cannot be granted in favor of a corporation because, being an artificial person and having existence only in legal contemplation,

it has no feelings, no emotions, no senses, It cannot, therefore, experience physical suffering and mental anguish, which call be experienced only by one having a nervous system. The

statement in People v. Manero and Mambulao Lumber Co. v. PNB that a corporation may recover moral damages if it "has a good reputation that is debased, resulting in social humiliation" is an obiter dictum. On this score alone the award for damages must be set aside, since RBS is a corporation.

National Power v. Philipp Brothers

G.R. No 126204 (November 20, 2001)

Facts: The National Power Corporation (NAPOCOR) issued invitations to bid for the supply and delivery of 120,000 metric tons of imported coal for its Batangas Coal-Fired Thermal Power Plant in Calaca, Batangas.

The Philipp Brothers Oceanic, Inc. (PHIBRO) prequalified and was allowed to participate as one of the bidders. After the public bidding was conducted, PHIBRO's bid was accepted. NAPOCOR's acceptance was conveyed in a letter dated July 8, 1987, which was received by PHIBRO on July 15, 1987. On July 10, 1987, PHIBRO sent word to NAPOCOR

that industrial disputes might soon plague Australia, the shipment's point of origin, which could seriously hamper PHIBRO's ability to supply the needed coal. From July 23 to July 31, 1987, PHIBRO again apprised NAPOCOR of the situation in Australia, particularly informing the latter that the ship owners therein are not willing to load cargo unless a "strike-free"

clause is incorporated in the charter party or the contract of carriage. In order to hasten the transfer of coal, PHIBRO proposed to NAPOCOR that they equally share the burden of a "strike-free" clause. NAPOCOR refused. Consequently, in October 1987, NAPOCOR once more advertised for the delivery of coal to its Calaca thermal plant. PHIBRO participated anew in this subsequent bidding.

On November 24, 1987, NAPOCOR disapproved PHIBRO's application for pre-qualification to bid for not meeting the minimum requirements. Upon further inquiry, PHIBRO found that the real reason for the disapproval was its purported failure to satisfy NAPOCOR's demand for damages due to the delay in the delivery of the first coal shipment. This prompted PHIBRO to file an action for damages with application for injunction against NAPOCOR. In its complaint, PHIBRO alleged that NAPOCOR's act of disqualifying it in the October 1987 bidding and in all subsequent biddings was tainted with malice and bad faith and prayed for actual, moral and exemplary damages and attorney's fees. Trial court rendered a decision in favor of PHIBRO, ordering NAPOCOR among others, to pay PHIBRO actual, moral, exemplary damages and costs.

Issue: Whether or not PHIBRO is entitled to the award of moral damages.

Held: No. Moral damages are not, as a general rule, granted to a corporation. While it is true that besmirched reputation is included in moral damages, it cannot cause mental anguish to a corporation, unlike in the case of a natural person, for a corporation has no reputation in the sense that an individual has, and besides, it is inherently impossible for a corporation to suffer mental anguish. In LBC Express, Inc. v. Court of Appeals, it was ruled that "Moral damages are granted in recompense for physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation, and similar injury. A corporation, being an artificial person and having existence only in legal contemplation, has no feelings, no emotions, no senses; therefore, it cannot experience physical suffering and mental anguish. Mental suffering can be experienced only by one having a nervous system and it flows from real ills, sorrows, and griefs of life — all of which cannot be suffered by respondent bank as an artificial person."

Nominal Damages

Ventanilla vs. Gregorio Centeno

G.R. No. 14333 (January 28, 1961)

Facts: Ventanilla instituted this action to recover damages against his lawyer, Atty. Centeno for neglecting to perfect within the reglementary period his appeal from an adverse judgment rendered by the CFI of Manila. Trial court’s facts showed that the required appeal bond was not filed by Atty. Centeno. The fact that the record on appeal was admitted for filing is the best evidence that Atty. Centeno had not in fact filed any appeal bond. The record on appeal was disapproved because it was filed out of time and no appeal bond had been filed by the plaintiff. Trial court rendered judgment in favor of Ventanilla ordered Centeno to pay Ventanilla the sum of P200 as nominal damages and the costs. Ventanilla appealed to the Court of Appeals and claimed that the trial court erred, among others, in ordering Centeno to pay only the sum of P200, and not P2,000 as nominal damages.

Issue: Whether or not the trial court erred in the amount of the award of nominal damages.

Held: No. Relative to the sufficiency of the sum of P200 as nominal damages awarded by the trial court to the appellant, article 2221 of the new Civil Code provides: “Nominal damages are adjudicated in order that a right of the plaintiff, which has been violated or invaded by the defendant, may be vindicated or recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered by him.”

The assessment of nominal damages is left to the discretion of the court, according to the circumstances of the case. Considering the circumstances, as found by the trial court, and the degree of negligence committed by the appellee, a lawyer, in not depositing on time the appeal bond and filing the record on appeal within the extension period granted by the court, which brought about the refusal by the trial court to allow the record on appeal, the amount of P200 awarded by the trial court to the appellant as nominal damages may seem exiguous. Nevertheless, considering that nominal damages are not for indemnification of loss suffered but for the vindication or recognition of a right violated or invaded; and that even if the appeal in civil case No. 18833 had been duly perfected, it was not an assurance that the appellant would succeed in recovering the amount he had claimed in his complaint, the amount of P2,000 the appellant seeks to recover as nominal damages is excessive. After weighing carefully all the considerations, the amount awarded to the appellant for nominal damages should not be disturbed.

Robes-Francisco Realty and Development Corp. vs.CFI

G.R. No. L-41093 (October 30, 1978)

Facts: On May 1962, private respondent Millan bought a lot from petitioner corporation Robes-Francisco Realty and Development Corporation (Robes-Francisco for brevity). Millan paid the installments in full on December 22, 1971, but it was only on March 2, 1973 that a Deed of Absolute Sale was executed in her favor. Notwithstanding the lapse of almost three

(3) years since she made her last payment, Robes-Francisco still failed to convey the corresponding transfer certificate of title (TCT) to Millan. Due to this, Millan was compelled to file a complaint for specific performance and damages against Robes-Francisco in 1974. One of the prayers in the complaint include the payment of damages, corrective and actual in the sum of P15,000.00.

The trial court ruled in favor of Millan and ordered Robes-Francisco to pay her nominal damages in the amount of P20,000.00 plus attorney’s fees in the amount of P5,000.00 and costs. Robes-Francisco now questions the award for nominal damages of P20,000.00 and attorney’s fees of P5,000.00 which are allegedly excessive and unjustified.

Issue: Whether or not the trial court was correct in awarding nominal damages?

Held: The trial court did not err in awarding nominal damages. However, the circumstances of the case warrant a reduction of the amount granted to Millan. There can be no dispute that Robes-Francisco was guilty of delay, amounting to nonperformance of its obligation, in issuing the TCT to Millan who had fully paid her installments. Article 1170 of the Civil Code expressly provides that those who in the performance of their obligations are guilty of fraud, negligence or delay and those who in any manner contravene the tenor thereof, are liable for damages. However, Millan submitted her case without presenting evidence on the actual damages suffered by her as a result of the non-performance of Robes-Francisco’s obligation

under the deed of sale. NONETHELESS, the facts show that the right of the vendee to acquire title over the lot was violated by Robes-Francisco. This entitles her at the very least to nominal damages. Nominal damages are not intended for indemnification of loss suffered but for the vindication or recognition of a right violated or invaded. They are recoverable where some injury has been done the amount of which the evidence fails to show, the assessment of damages being left to the discretion of the court according to the circumstances of the case.

In the situation before Us, We are of the view that the amount of P20,000.00 is excessive. The admitted fact that Robes-Francisco failed to furnish Millan the TCT because said lot was mortgaged to GSIS does not in itself show that there was bad faith. Bad faith cannot be presumed. Millan’s contention that the P20,000.00 award may be considered in the nature of exemplary damages cannot be upheld because in case of breach of contract, exemplary damages may be awarded if the guilty party acted in wanton, fraudulent, reckless, oppressive or malevolent manner.

People vs Gopio

G.R. No. 133925 (November 29, 2000)

Facts: Agustin Gopio was accused of committing statutory rape on Ma. Princess Millano y, San Diego, an 11 year-old girl, against her will.

The incident was said to have taken place while the Brgy. San Pascual, Obando Bulacan, was celebrating its town fiesta. The victim allegedly went to Gopio’s store to buy cooking oil around 10:00 am but instead was taken to the bedroom where she was raped. The victim kept silent about the incident for fear of Gopio and of what her parents would do to her. Likewise, the victim was ashamed and worried that her friends would spread the news regarding her unfortunate experience.

On two other occasions, also in 1995, the victim related that she was again raped by Gopio but remained silent about it.

It was only when the victim was examined Municipal Health Clinic for complaints of pain in her navel that her mother, Luzviminda, discovered that her daughter was no longer a virgin. Upon inquiry, Princess admitted that Gopio had raped her.

The trial court convicted Gopio guilty of statutory rape, sentencing him to suffer the penalty of reclusion perpetua. The court further ruled that Gopio is liable to indemnify the heirs of the victim in the amount of P3,727.00 as actual damages, P30,000.00, as moral damages, and to pay the costs of the suit.

Issues: (1) Whether Gopio is liable of statutory rape and (2) whether Gopio is liable to pay the heirs of the victim actual and moral damages

Held: (1) The Court affirmed the ruling of the trial court convicting the accused of statutory rape. The testimony of the victim was clear and categorical, positively identifying the accused as the perpetrator of the crime.

(2) However, with respect to the award of actual damages, the court ruled that the award of actual damages in the amount of P 3727.00 was deleted in the absence of proof as required in Article 2199.

“To be entitled to actual and compensatory damages, there must be competent proof constituting evidence of the actual amount thereof, such as receipts showing the expenses incurred on account of the rape incident”.

Among the evidence presented by the mother to establish a claim for actual damages, only the laboratory fee in the amount of P350.00 was duly receipted, the rest were merely a doctor’s prescription and a handwritten list of expenses.

Nevertheless, the court ruled that under Article 2221 of the Civil Code, the complainants were entitled to nominal damages. Nominal damages are adjudicated in order that the right of the plaintiff, which has been violated or invaded by the defendant, may be vindicated or recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered by him.

proper.”

As has been held, “whenever there has been a violation of an ascertained legal right, although no actual damages resulted or none are shown, the award of nominal damages is

The victim’s family evidently incurred expenses due to the crime committed and the victim also suffered pains in her navel. Hence, the court awarded them P2,000 for nominal

damages and increased the moral damages from P30,000.00 to P50,000.00.

Dr. Armovit, et al. vs. CA and Northwest Airlines, Inc.

G.R. No. 88561 (April 20, 1990)

Facts: Dr. Herman Armovit, a Filipino physician residing in the United States, along with his family, came home to the Philippines for a Christmas visit.

They purchased three round plane tickets from Northwest Airlines, and was confirmed as “OK” by a Northwest Airlines’ ticket sales agent. The Armovits even reconfirmed their date of departure through their representative Ernesto Madriaga who personally presented the three (3) tickets at the Northwest Airlines’ Roxas Boulevard office.

For their return flight, the Armovits arrived in the airport at 9:15 in the morning for their 10:30 AM flight, only to be rudely informed that they cannot be accommodated because the 10:30 AM flight was erroneous and that the 9:15 AM flight was already taking off.

The family was bumped off at the Manila International Airport. Dr. Armovit complained that as a result of the “bump off” he was not able to keep his appointments with his patients and that the family suffered anguish, wounded feelings, and serious anxiety day and night until they were informed that seats were available for them the following day.

The trial court awarded the Armovits actual, moral, exemplary and nominal damages; but on appeal the Court of Appeals deleted the award of moral and nominal damages.

Issue: Whether the Armovits are entitled to moral and exemplary damages arising from the breach of the contract of carriage

Held: The deletion of the moral damages on the ground that petitioners did not take the witness stand to testify on "their social humiliation, wounded feelings and anxiety, and that the breach of contract was not malicious or fraudulent" was improper. Northwest Airlines was found guilty of gross negligence in the issuance of the tickets with the erroneous entry of date of departure and its failure to change the same when the Armovits had reconfirmed their flight. The gross negligence of the airline amounted to malice and bad faith and tainted the breach of air transportation contract.

There was sufficient indicia of malice and bad faith on the part of the airline when it issued the tickets, failed to correct the dates and rudely informed the Armovits that they were not to be accommodated.

The petitioners are evidently entitled to moral damages. Their failure to testify is of no moment since it was explained the assassination of Senator Benigno Aquino, Jr. resulting to turmoil in the country refrained the Armovits from coming back to testify; nevertheless, Atty. Raymundo Armovit who was with the complainants at the time of the incident, took the witness stand. By the same token to provide an example for the public good, an award of exemplary damages is also proper. Nevertheless, the deletion of the nominal damages by the appellate court is well-taken since there is an award of actual damages. Nominal damages cannot co-exist with actual or compensatory damages.

Temperate Damages

People vs. Singh

G.R. No. 129782 (June 29, 2001)

Facts: Dilbang Singh, the private compalinant in the frustrated murder case, recalled that while he was cleaning his motorbike in front of his appartment, Dalvir, Balwinder, Gurmok, Jarnail, Amarjit, Mohinder, Dial, Kuldip --all surnamed Singh-- Johander Singh Dhillon, and Malkit Singh Dhillon arrived, shouting foul remarks in

their native language and demanded Surinder Singh to come out of the apartment. When Surinder Singh came out of his apartment, Dalvir Singh tried to stab him but Surinder was able to move away. Dalvir Singh told his companions to hold Surinder Singh and thereafter, Dial and Johinder each held the arms of Surinder, while Kuldip pushed Surinder. Dalvir Singh then stabbed Surinder on the right side of his stomach, causing the latter to fall.

Dial Singh said that Surinder failed to give money and if others will also refuse, the same fate will happen to them. As Surinder Singh tried to get up, Malkit and Jarnail started hitting him with lead pipes, while Johinder and Dial punched and kicked him. Amarjit, who was holding a gun, warned everyone not to help Surinder or else he will shoot.

While all these things were going on, private complainant Dilbag Singh tried to stop them but Balwinder Singh stabbed him on his back. Gurmok likewise stabbed him with a bolo, but he was not hit as he was able to move to one side. After that, the ten (10) accused Indians left. Thereafter, Dilbag Singh and Surinder Singh, were brought to the hospital. Surinder was pronounced dead on arrival.

Issue: Whether or not the court a quo erred in awarding excessive damages against accused-appellants.

Held: In the criminal case for frustrated murder, the trial court awarded private complainant Dilbag Singh the amount of P16,000.00 representing his hospitalization and medical expenses, and P 30,000.00 as attorney’s fees. For his hospitalization and medical expenses, the receipts submitted to support said claim amounted only to P370.50. Hence, Dilbag Singh is entitled only to the said amount. The award of attorney’s fees is hereby deleted. Nonetheless, private complaint is entitled to moral damages in the amount of P50,000.00 for the suffering he endured from appellants’ felonious acts.

In the criminal case for murder, only the following expenses were proven to recover actual damages: funeral expenses and air ticket/freight of the cadaver. The amounts for hospitalization expenses are deleted since it is not supported by evidence. Attorneys’ fees and the compensation for loss of earning capacity, are likewise deleted for lack of basis. However, the trial court’s award of P50,000.00 as civil indemnity, and P50,000.00 moral damages are affirmed.

Awards for loss of earning capacity partake of damages which must be proven not only by credible and satisfactory evidence, but also by unbiased proof. The testimony of Balwinder Singh Gill, first cousin of the deceased, on the alleged income of the deceased, is not enough. The best evidence to substantiate income earned by foreigners while in the Philippines is the payment of taxes with the Bureau of Internal Revenue. Absent such proof, bare allegation is insufficient. Nevertheless, considering that the definite proof of pecuniary loss cannot be offered, and the fact of loss has been established, appellants shall pay the heirs of Surinder Singh temperate damages.

People of the Philippines vs. Edison Plazo

G.R. No. 120547 (January 29, 2001)

Facts: Leonor Fabula went out of her house in May-anao, Tigaon, Camarines Sur to buy sugar at a nearby store. When she reached the store, she saw appellant boxing her son Romeo Fabula and banging his head on the post of the store, while asking him why he told the police about his brother and the location of appellant's house. When Leonor sought to intervene, appellant got angry at her.

She became afraid and asked for help but nobody went near them. Romeo freed himself from the hold of appellant and ran away. Appellant chased Romeo with a small bolo known locally as "gatab." Leonor shouted at appellant to stop but the latter did not heed her pleas. Appellant caught up with Romeo and stabbed him at the back causing Romeo to fall on the ground. Appellant continued to stab Romeo in the upper and lower chest area. Leonor continued shouting for help and eventually someone came to help. However, when she saw her son no longer moving, she told the people not to touch or move him because she was going to the Poblacion of Tigaon to get a policeman.

When Patrolmen Virgilio Azucena and Jose Madera arrived at the scene of the crime, they saw the fallen body of Romeo with a small bolo imbedded on his chest and the detached handle of the bolo on the ground near his body. On June 10, 1991, appellant was charged with the crime of murder After trial, the trial court rendered its decision finding appellant guilty of the crime of murder and ordered Plazo to indemnify the heirs of the late Fabula for the latter's death the sum of Fifty Thousand Pesos (P50,000.00); the sum of Fifteen Thousand Seven Hundred Twelve Pesos (P15,712.00) as actual damages; and the sum of Ten Thousand Pesos (P10,000.00) as moral damages.

Issue: Whether or not the lower court erred in the award of actual damages.

Held: The trial court correctly awarded the amount of P50,000.00 as indemnity. However, the award of actual damages in the amount of P15,712.00 was based solely on the bare assertions of the mother of the victim. The Court can only grant such amount for expenses if they are supported by receipts. In the absence thereof, no actual damages can be awarded. However, in lieu of actual damages, TEMPERATE DAMAGES under Art. 2224 of the Civil Code may be recovered where it has been shown that the victim's family suffered some

pecuniary loss but the amount thereof cannot be proved with certainty. We find the award of P15,000.00 as temperate damages reasonable. Moral damages cannot be awarded in the absence of any evidence to support its award.

PNB vs. CA

G.R. No. 108630 (April 2, 1996)

Facts: private respondent Loreto Tan is the owner of the land which has been expropriated by the government. After the proceedings, Tan requested the release to him of the expropriation price of P32, 480.00. The trial court ordered the PNB to release the same to Tan as deposited in it by the government. Petitioner’s Asst.branch manager, Juan Tagamolilia, issued managers check for the said amount and delivered it to Sonia Gonzaga without Tan’s knowledge. As a consequence, Tan demanded the payment from PNB which refused on the ground that they had already paid the same based on the SPA allegedly executed in her favour by Tan. Tan therefore executed an affidavit contending that he had never executed such SPA nor authorized Gonzaga to receive it. PNB, on the other hand, failed to produce the SPA as directed by the court. The TC ruled against the PNB. CA affirmed the same but deleted the award of P5, 000.00 for exemplary damages and P5, 000.00 for attorney’s fees.

Issues: (1) Whether or not an SPA existed. (2) Whether or not the award of attorney’s fees and exemplary damages is proper.

Held: (1) No. Under the best evidenced rule, only the original document is the best evidence of the fact as to whether the creditor authorized a third person to receive the payment from the debtor and in the absence of such document, the debtor’s argument regarding due payment must fail.

In this case, since PNB failed to prove the SPA as an evidence, its contention that they paid petitioner must fail.

(2) The award of attorney’s fees is proper under Art. 2208 of the CC since Tan is forced to litigate to protect his rights, but the award of exemplary damages is properly deleted. Under Art. 2232 of the CC, exemplary damages may be awarded if a part acted in a wanton, fraudulent, reckless, oppressive or malevolent manner. However, they cannot be recovered as a matter of right; the court has yet to decide whether or not they should be adjudicated. In the case at bar, while there is a clear breach of petitioners obligation to pay private respondents, there is no evidence that it acted in a fraudulent, wanton, reckless or oppressive manner. Furthermore, there is no award to compensatory damages which is a prerequisite before exemplary damages may be awarded.

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Wednesday, March 3, 2021

torts digests and syllabus

CASE DIGESTS

Outline by Atty. Nicanor B. Jimeno & Atty. Linda Jimeno

(As of 1

8

semester SY 2010-2011)

99

163

253 SCRA 483 (February 9, 1996)

191 SCRA 195 (November 6, 1990)

73 Phil 607 (July 8, 1942)

Issues:

105 Phil 266 (March 4, 1959)

Issues:

Vicente Calalas vs. Court of Appeals

Picart vs. Smith

JARCO Marketing Corporation vs. Court of Appeals and Spouses Aguilar

Issues:

Del Rosario vs. Manila Electric Company

Ylarde vs. Aquino

Cullion Ice, Fish and Electric Company vs. Philippine Motors Corporation

Held: YES. When a person holds himself out as being competent to do things requiring professional skill, he will be held liable for negligence if he fails to exhibit the care and skill of one ordinarily skilled in the particular work which he attempts to do.

Marinduque vs.Workmen’s Compensation

Batiquin vs. CA

D.M. Consunji vs. CA

Held:

Metro Manila Transit Corp. (MMTC) vs. CA

Issues:

L-21512 (Aug 31, 1966)

102 Phil 181 Facts: supra

G.R. No. L-8328 (1956)

NOTE: Emphasis is made on the obiter dictum.

wrongful act or omission of the defendant.

Issue: Whether or not Metropolitan is negligent in operating the pool.

Issue: Is the last clear chance doctrine applicable in this case? Who is the proximate cause of the loss?

ISSUES

NOT arise out of and in the course of his employment.

employment are excluded.

G.R.No. 110295 (October 18, 1993)

29 Phil 542 (February 18, 1915)

having a reasonable opportunity to prevent the acts or its continuance, injures a person or violates the criminal law, the owner of the automobile, although present therein at

G.R. No. 70458 October 5, 1988

G.R. No. L-11154 March 21, 1916

Jikil Taha sold a motor launch named M/L "SAN RAFAEL" to Alberto Timbangcaya but a year later Timbangcaya filed a complaint with the Office of the Provincial Facts:

G.R. No. 132344 (2000)

G.R. No. L-18630 (1966)

G.R. No. 73886 (January 31, 1989)

De la Pena vs. Court of Appeals

G.R. No. 81827 (March 28, 1994)

G.R. No. 112212 (March 2, 1998)

Issue: Whether or not the appellate court erred in awarding damages.

Held: No. In the instant case, the trial court awarded damages analogous to malicious prosecution under Article 2219(8) of the NCC for the following reasons:

The malice with which Fule filed the case is apparent. As an experienced jeweler who thoroughly examined the earrings himself and went so far as to sketch

them earlier, it is illogical that he would fail to exert extra effort to check its genuineness at the precise moment of the exchange. His acts thus failed to accord with what an ordinary prudent man would have done in the same situation.

As an experienced businessman and banker, he was shrewd enough to bloat the property’s price from Php25,000.00 to Php75,000.00 only a few days after he had purchased it for a far lower cost, the value of which still fell short of the diamond earrings’ price.

Also, it took him 2 hours of unexplained delay before complaining that the earrings were counterfeit—a period in which anything could have happened while Fule was in possession of the jewelry.

G.R. No. 115024 (February 7, 1996)

Issue: Whether nor not the damages should be mitigated due to the contributory negligence of Valenzuela for parking along Aurora Blvd, which happens to be a no parking zone.

advanced, will only allow a reasonable amount of functional restoration of the motor functions of the lower limb. The sensory functions are forever lost. The resultant anxiety, sleeplessness, psychological injury, mental and physical pain are inestimable.

G.R. No. 123404 (February 26, 1997)

Issue: Whether or not the petitioner is guilty and liable for damages.

G.R. No. L-22415 (March 30, 1966)

having been previously paid.

Issue: Whether or not the award for moral damages and exemplary damages could be increased.

Held: The Court ruled in favor of Sen. Lopez and his family and increased the amounts of moral and exemplary damages.

Factors in determining amount for moral damages:

MORAL DAMAGES

EXEMPLARY DAMAGES

In view of its nature, it should be imposed in such an amount as to effectively deter similar breach of contracts in the future by defendant or other airlines.

G.R. No. 111584 (September 17, 2001)

Issue: Are Spouses Chua entitled to moral, exemplary, and actual damages?

Held: The Court held that Spouses Chua are entitled to moral and exemplary damages. Moral and exemplary damages may be awarded without proof of pecuniary loss. In awarding both, the court shall take into account the circumstances surrounding the case and assess damages according to its discretion.

Of course, a plaintiff need not prove the actual extent of exemplary damages, for its determination is addressed to the sound discretion of the court upon proof of the plaintiff's entitlement to moral, temperate, or compensatory damages (Article 2234, Civil Code).

G.R. No. 129782 (June 29, 2001)

Issue: Whether or not the court a quo erred in awarding excessive damages against accused-appellants.

Issues: (1) Whether or not an SPA existed. (2) Whether or not the award of attorney’s fees and exemplary damages is proper.

Held: (1) No. Under the best evidenced rule, only the original document is the best evidence of the fact as to whether the creditor authorized a third person to receive the payment from the debtor and in the absence of such document, the debtor’s argument regarding due payment must fail.

In this case, since PNB failed to prove the SPA as an evidence, its contention that they paid petitioner must fail.

San Beda College Alabang- Academic Bar Operations 2011

Jikil Taha sold a motor launch named M/L "SAN RAFAEL" to Alberto Timbangcaya but a year later Timbangcaya filed a complaint with the Office of the Provincial

Facts: