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15.1:
G.R. No. L-25172 May 24, 1974
LUIS
MA.
vs.
ANTONIO R. DE JOYA, respondent.
ARANETA, petitioner,
CASTRO, J.:p
Petition for review of the decision of the Court of Appeals in CA-G.R. 34277-R
ordering Luis Ma. Araneta (hereinafter referred to as the petitioner) to indemnify
Antonio R. de Joya (hereinafter referred to as the respondent) for one-third of the
sum of P5,043.20 which the latter was adjudged to pay the Ace Advertising
Agency, Inc., the plaintiff in the recovery suit below.
Sometime in November 1952 the respondent, then general manager of the Ace
Advertising, proposed to the board of directors 1 that an employee, Ricardo
Taylor, be sent to the United States to take up special studies in television. The
board, however, failed to act on the proposal. Nevertheless, in September 1953
the respondent sent Taylor abroad. J. Antonio Araneta, a company director,
inquired about the trip and was assured by the respondent that Taylor's expenses
would be defrayed not by the company but by other parties. This was thereafter
confirmed by the respondent in a memorandum.
While abroad, from September 1, 1953 to March 15, 1954, Taylor continued to
receive his salaries. The items corresponding to his salaries appeared in
vouchers prepared upon the orders of, and approved by, the respondent and were
included in the semi-monthly payroll checks for the employees of the
corporation. The petitioner signed three of these checks on November 27,
December 15 and December 29, 1953. The others were signed by either the
respondent, or Vicente Araneta (company treasurer) who put up part of the bill
connected with Taylor's trip and also handed him letters for delivery in the United
States. The Ace Advertising disbursed P5,043.20, all told, on account of Taylor's
travel and studies.
On August 23, 1954 the Ace Advertising filed a complaint with the court of first
instance of Manila against the respondent for recovery of the total sum disbursed
to Taylor, alleging that the trip was made without its knowledge, authority or
ratification. The respondent, in his answer, denied the charge and claimed that
the trip was nonetheless ratified by the company's board of directors, and that in
any event under the by-laws he had the discretion, as general manager, to
authorize the trip which was for the company's benefit..
A 3rd-party complaint was also filed by the respondent against Vicente Araneta
(COMPANY TREASURER), the petitioner and Ricardo Taylor. The respondent
proved that Vicente Araneta, as treasurer of the firm, signed a check representing
the company's share of the transportation expense of Taylor to the United States,
and that a series of payroll checks from September 15, 1953 to December 31,
1953, inclusive, which included the salaries of Taylor, was signed by Vicente
Araneta and the petitioner who is a vice-president of the company. Both Aranetas
disowned any personal liability, claiming that they signed the checks in good faith
as they were approved by the respondent..
On April 13, 1964 the trial court rendered judgment ordering the respondent to
pay the Ace Advertising "the sum of P5,043.20 with interest at the legal rate from
August 23, 1954 until full payment," and dismissing the 3rd-party complaint.
The respondent appealed to the Court of Appeals, which on August 2, 1965,
rendered a decision affirming the trial court's judgment in favor of the Ace
Advertising but reversing the dismissal of the 3rd-party complaint. The appellate
court found as a fact that Taylor's trip had been neither authorized nor ratified by
the company.
The appellate court's full statement of its categorical and unequivocal findings of
fact on the nature and extent of the participation of the petitioner as well as
Vicente Araneta is hereunder quoted:
The evidence not only is clear, but is even not disputed at all by
Vicente and Luis Araneta who neither of them took the witness stand
to refute appellant's evidence, that as to Vicente it was to him that
appellant first broached the subject-matter of sending Taylor to
America, that Vicente Araneta evinced unusual interest, and went to
the extent of entrusting Taylor with letters for delivery to certain
principals of Gregorio Araneta, Inc. in the United States, and he even
signed the check for P105.20 to cover expenses for his tax clearance,
documentary stamps and passport fees, in connection with the trip,
on 8 September, 1953, and then on 5 October, 1953, still another
check for P868.00 which was half the amount for his plane ticket; and
as to Luis Araneta, it not at all being disputed that when Taylor was
already in America, his salaries while abroad were paid on vouchers
and checks signed either by him or by Vicente, or by appellant
himself; because of all these, the conclusion is forced upon this
Court that it could not but have been but that both Vicente and Luis
were informed and gave their approval to Taylor's trip, and to the
payment of his trip expenses and salaries during his absence, from
corporate funds; if this was the case as it was, there can be no
question but that they two were also privy to the unauthorized
disbursement of the corporate moneys jointly with the appellant;
what had happened was in truth and in fact a venture by them given
their stamp of approval; and as it was an unauthorized act of
expenditure of corporate funds, and it was these three without
whose acts the same could not have happened, the juridical situation
was a simple quasi-delict by them committed upon the corporation,
for which solidary liability should have been imposed upon all in the
first place, Art. 2194, New Civil Code; and only De Joya having been
sued and made liable by the corporation, it was the right of the latter
to ask that his two joint tortfeasors be made to shoulder their
proportional responsibility. (emphasis supplied)
The basic legal issue is whether the petitioner is guilty of a quasi-delict as held
below.
It is our view, and we so hold, that the judgment of the Court of Appeals should
be upheld. The petitioner's assertion that he signed the questioned payroll
checks in good faith has not been substantiated, he in particular not having
testified or offered testimony to prove such claim. Upon the contrary, in spite of
his being a vice-president and director of the Ace Advertising, the petitioner
remained passive, throughout the period of Taylor's stay abroad, concerning the
unauthorized disbursements of corporate funds for the latter. This plus the fact
that he even approved thrice payroll checks for the payment of Taylor's salary,
demonstrate quite distinctly that the petitioner neglected to perform his duties
properly, to the damage of the firm of which he was an officer. The fact that he
was occupying a contractual position at the Ace Advertising is of no moment. The
existence of a contract between the parties, as has been repeatedly held by this
Court, constitutes no bar to the commission of a tort by one against the other and
the consequent recovery of damages. 2
ACCORDINGLY, the judgment of the Court of Appeals is affirmed, at petitioner's
cost.
Makalintal, C.J., Makasiar, Esguerra and Muoz Palma, JJ., concur.
Teehankee, J., took no part.
ARANETA VS DE JOYA
FACTS: This present petition for review stemmed from the recovery case filed by
Ace Advertising against Antonio R. de Joya, the general manager of the same
company. Ace Advertising prayed for the recovery of the total sum of Php5,043.20
disbursed to an employee named Ricardo Taylor, who was sent to the US to study
about television. The company alleged that the trip was made without its
knowledge, authority or ratification. The respondent, in his answer, denied the
charge and claimed that the trip was nonetheless ratified by the company's board
of directors, and that in any event under the by-laws he had the discretion, as
general manager, to authorize the trip which was for the company's benefit.
Along his answer, the respondent likewise filed a 3rd party complaint against the
Vicente Areneta (company treasurer), Ricardo Taylor, and herein petitioner. The
respondent proved that Vicente Araneta, as treasurer of the firm, signed a check
representing the company's share of the transportation expense of Taylor to the
United States, and that a series of payroll checks from September 15, 1953 to
December 31, 1953, inclusive, which included the salaries of Taylor, was signed
by Vicente Araneta and the petitioner who is a vice-president of the company.
CFI in its judgement, ordered respondent to pay the sum of php5,043.20 and
dismissed the 3rd party complaints.
Respondent appealed to CA, wherein it affirmed CFIs judgment as to the
recovery case, but reversed its decision with regard the third party complaints.
The appellate court found as a fact that Taylor's trip had been neither authorized
nor ratified by the company.
Petitioner averred in his defense that they signed the checks in good faith as they
were approved by the respondent.
ISSUE: Whether the petitioner is guilty of a quasi-delict.
RULING: YES. The judgment of the Court of Appeals should be upheld. The
petitioner's assertion that he signed the questioned payroll checks in good faith
has not been substantiated, he in particular not having testified or offered
testimony to prove such claim. Upon the contrary, in spite of his being a vicepresident and director of the Ace Advertising, the petitioner remained passive,
throughout the period of Taylor's stay abroad, concerning the unauthorized
disbursements of corporate funds for the latter. This plus the fact that he even
approved thrice payroll checks for the payment of Taylor's salary, demonstrate
quite distinctly that the petitioner neglected to perform his duties properly, to the
damage of the firm of which he was an officer. The fact that he was occupying a
contractual position at the Ace Advertising is of no moment. The existence of a
contract between the parties, as has been repeatedly held by this Court,
constitutes no bar to the commission of a tort by one against the other and the
consequent recovery of damages.
BOTTLERS
PHILIPPINES,
INC.,
petitioner argued that since the complaint is for breach of warranty under Article
1561 of the said Code. In her Comment 4 thereto, private respondent alleged that
the complaint is one for damages which does not involve an administrative action
and that her cause of action is based on an injury to plaintiff's right which can be
brought within four years pursuant to Article 1146 of the Civil Code; hence, the
complaint was seasonably filed. Subsequent related pleadings were thereafter
filed by the parties. 5
In its Order of 23 January 1991, 6 the trial court granted the motion to dismiss. It
ruled that the doctrine of exhaustion of administrative remedies does not apply
as the existing administrative remedy is not adequate. It also stated that the
complaint is based on a contract, and not on quasi-delict, as there exists preexisting contractual relation between the parties; thus, on the basis of Article
1571, in relation to Article 1562, the complaint should have been filed within six
months from the delivery of the thing sold.
Her motion for the reconsideration of the order having been denied by the trial
court in its Order of 17 April 1991, 7the private respondent came to this Court via a
petition for review on certiorari which we referred to the public respondent "for
proper determination and disposition. 8 The public respondent docketed the case
as CA-G.R. SP No. 25391.
In a decision promulgated on 28 January 1992, 9 the public respondent annulled
the questioned orders of the RTC and directed it to conduct further proceedings
in Civil Case No. D-9629. In holding for the private respondent, it ruled that:
Petitioner's complaint being one for quasi-delict, and not for breach
of warranty as respondent contends, the applicable prescriptive
period is four years.
It should be stressed that the allegations in the complaint plainly
show that it is an action or damages arising from respondent's act of
"recklessly and negligently manufacturing adulterated food items
intended to be sold or public consumption" (p. 25, rollo). It is truism
in legal procedure that what determines the nature of an action are
the facts alleged in the complaint and those averred as a defense in
the defendant's answer (I Moran 126; Calo v. Roldan, 76 Phil. 445;
Alger Electric, Inc. v. CA, 135 SCRA 340).
Secondly, despite the literal wording of Article 2176 of the Civil code,
the existence of contractual relations between the parties does not
absolutely preclude an action by one against the other for quasidelict arising from negligence in the performance of a contract.
In Singson v. Court of Appeals (23 SCRA 1117), the Supreme Court ruled:
It has been repeatedly held: 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
. . . . Thus in Air France vs. Carrascoso, . . . (it was held
that) although the relation between a passenger and a
We find no merit in the petition. The public respondent's conclusion that the
cause of action in Civil Case No. D-9629 is found on quasi-delict and that,
therefore, pursuant to Article 1146 of the Civil Code, it prescribes in four (4) years
is supported by the allegations in the complaint, more particularly paragraph 12
thereof, which makes reference to the reckless and negligent manufacture of
"adulterated food items intended to be sold for public consumption."
The vendee's remedies against a vendor with respect to the warranties against
hidden defects of or encumbrances upon the thing sold are not limited to those
prescribed in Article 1567 of the Civil Code which provides:
Art. 1567. In the case of Articles 1561, 1562, 1564, 1565 and 1566, the
vendee may elect between withdrawing from the contract and
demanding a proportionate reduction of the price, with damages
either
case. 13
The vendee may also ask for the annulment of the contract upon proof of error or
fraud, in which case the ordinary rule on obligations shall be applicable. 14 Under
the law on obligations, responsibility arising from fraud is demandable in all
obligations and any waiver of an action for future fraud is void. Responsibility
arising from negligence is also demandable in any obligation, but such liability
may be regulated by the courts, according to the circumstances. 15 Those guilty of
fraud, negligence, or delay in the performance of their obligations and those who
in any manner contravene the tenor thereof are liable for damages. 16
The vendor could likewise be liable for quasi-delict under Article 2176 of the Civil
Code, and an action based thereon may be brought by the vendee. 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 arise fromquasi-delict, i.e., the acts which breaks the contract may also be
a quasi-delict. Thus, in Singson vs. Bank of the Philippine Islands, 17 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. 18 Indeed, this view has been, in effect, reiterated in a
comparatively
recent
case.
Thus,
in Air
France
vs. Carrascoso, 19 involving an airplane passenger who, despite hi
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 aircarrier, 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 . . . 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. 20
Under American law, the liabilities of a manufacturer or seller of injurycausing products may be based on negligence, 21 breach of
DIGEST:
15.3 COCA-COLA BOTTLERS PHILIPPINES, INC. vs. CA and MS. LYDIA
GERONIMO
FACTS: Private respondent was the proprietress of Kindergarten Wonderland
Canteen in Dagupan City. In August 1989, some parents of the students
complained to her that the Coke and Sprite soft drinks sold by her contained
fiber-like matter and other foreign substances. She brought the said bottles for
examination to DOH and it was found out that the soft drinks are adulterated.
As a result, her per day sales of soft drinks severely plummeted that she had to
close her shop on 12 December 1989 for losses. She demanded damages from
petitioner before the RTC which dismissed the same on motion by petitioner
based on the ground of Prescription. On appeal, the CA annulled the orders of the
RTC.
ISSUE: WON the action for damages by the proprietress against the soft drinks
manufacturer should be treated as one for breach of implied warranty under
article 1561 of the CC which prescribes after six months from delivery of the thing
sold.
RULING: Petition
Denied.
The SC agrees with the CAs conclusion that the cause of action in the case at bar
is found on quasi-delict under Article 1146 of the CC which prescribes in four
years and not on breach of warranty under article 1562 of the same code. This is
supported by the allegations in the complaint which makes reference to the
reckless and negligent manufacture of "adulterated food items intended to be
sold for public consumption."
- versus -
NOEL CORDERO,
Defendant.
Promulgated:
October 14, 2005
x------------------------------------------------------------------------------------------------x
DECISION
SANDOVAL-GUTIERREZ, J.:
This is a petition for review on certiorari of
the Decision[1] of the Court of Appeals dated
April 30, 1999 in CA-G.R. CV No. 51671,
entitled, Noel
Cordero,
Plaintiff-Appellee
versus American Express International, Inc.,
Defendant-Appellant.
Petitioner is a foreign corporation that issues
charge cards to its customers, which the
latter then use to purchase goods and
services at accredited merchants worldwide.
as
and
for
from P300,000.00
(b) Exemplary
to P100,000.00.
from P200,000.00
damages
No pronouncement as to costs.
SO ORDERED.
sustain
the
trial
courts
INSPECT
Strictly
Question
(for
identification) cardmembers before
approving any charge?
Mr. Johnny Chen : Under the existing
policies of AEII, we dont have to inform
the cardholders if they have to pass the
INSPECT
Strictly
Questions
(for
identification).
Question No 10 : If the answer to Q9 is in the
negative, please explain why not?
Mr. Johnny Chen : The reason why we dont
have to are because, first, we are not
terminating
the
service
to
the
cardholder. Second, it doesnt mean that
we are going to limit the service to the
cardholder. Third, as long as the
cardholder can present an identification
card of his membership, we allow him
to use the card. He can show this by
telephoning the company or by
presenting us his passport or travel
document. When Watson Company
called AEII for authorization, AEII
representative requested that he talk to
Mr. Cordero but he refused to talk to
any representative of AEII. AEII could
not prove then that he is really the real
card holder.
Mr. Chen Heng Kun was briefly crossexamined by respondents counsel, thus:
Question No 10 : Question 9 is objected to
since the best evidence would be the
membership
agreement
between
plaintiffs and AEII.
Significantly,
paragraph
Cardmember
Agreement
respondent provides:
16
of
signed
the
by