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charRepublic of the Philippines the judgment appealed from.

Where the plaintiff in a negligence


SUPREME COURT action, by his own carelessness contributes to the principal
Manila occurrence, that is, to the accident, as one of the determining
EN BANC causes thereof, he cannot recover. This is equally true of the
G.R. No. L-9308 December 23, 1914 defendant; and as both of them, by their negligent acts,
JUAN BERNARDO, plaintiff-appellant, contributed to the determining cause of the accident, neither can
vs. recover.
M. B. LEGASPI, defendant-appellee. The judgment appealed from is affirmed, with costs against the
Roman de Jesus for appellant. appellant.itc-alf
No appearance for appellee.

MORELAND, J.:
This is an appeal from a judgment of the Court of First Instance of
the city of Manila dismissing the complaint on the merits filed in
an action to recover damages for injuries sustained by plaintiff's
automobile by reason of defendant's negligence in causing a
collision between his automobile and that of plaintiff. The court in
its judgment also dismissed a cross-complaint filed by the
defendant, praying for damages against the plaintiff on the ground
that the injuries sustained by the defendant's automobile in the
collision referred to, as well as those to plaintiff's machine, were
caused by the negligence of the plaintiff in handling his
automobile.
The court found upon the evidence 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.1awphil.net
Upon the facts, as they appear of record, the judgment must be
affirmed, as the evidence clearly supports the decision of the trial
court. The law applicable to the facts also requires an affirmance of

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Republic of the Philippines short), an independent contractor which undertook the
SUPREME COURT construction of the manhole and the conduit system. 3
Manila Accordingly, PLDT filed a third-party complaint against Barte
SECOND DIVISION alleging that, under the terms of their agreement, PLDT should in
G.R. No. L-57079 September 29, 1989 no manner be answerable for any accident or injuries arising from
PHILIPPINE LONG DISTANCE TELEPHONE CO., INC., petitioner, the negligence or carelessness of Barte or any of its employees. 4 In
vs. answer thereto, Barte claimed that it was not aware nor was it
COURT OF APPEALS and SPOUSES ANTONIO ESTEBAN and notified of the accident involving respondent spouses and that it
GLORIA ESTEBAN, respondents. had complied with the terms of its contract with PLDT by installing
the necessary and appropriate standard signs in the vicinity of the
REGALADO, J.: work site, with barricades at both ends of the excavation and with
This case had its inception in an action for damages instituted red lights at night along the excavated area to warn the traveling
in the former Court of First Instance of Negros Occidental 1 by public of the presence of excavations. 5
private respondent spouses against petitioner Philippine Long On October 1, 1974, the trial court rendered a decision in favor of
Distance Telephone Company (PLDT, for brevity) for the private respondents, the decretal part of which reads:
injuries they sustained in the evening of July 30, 1968 when IN VIEW OF THE FOREGOING considerations the
their jeep ran over a mound of earth and fell into an open defendant Philippine Long Distance Telephone
trench, an excavation allegedly undertaken by PLDT for the Company is hereby ordered (A) to pay the plaintiff
installation of its underground conduit system. The complaint Gloria Esteban the sum of P20,000.00 as moral
alleged that respondent Antonio Esteban failed to notice the damages and P5,000.00 exemplary damages; to
open trench which was left uncovered because of the creeping plaintiff Antonio Esteban the sum of P2,000.00 as
darkness and the lack of any warning light or signs. As a result moral damages and P500.00 as exemplary damages,
of the accident, respondent Gloria Esteban allegedly sustained with legal rate of interest from the date of the filing
injuries on her arms, legs and face, leaving a permanent scar of the complaint until fully paid. The defendant is
on her cheek, while the respondent husband suffered cut lips. hereby ordered to pay the plaintiff the sum of
In addition, the windshield of the jeep was shattered. 2 P3,000.00 as attorney's fees.
PLDT, in its answer, denies liability on the contention that the (B) The third-party defendant is hereby ordered to
injuries sustained by respondent spouses were the result of reimburse whatever amount the defendant-third
their own negligence and that the entity which should be held party plaintiff has paid to the plaintiff. With costs
responsible, if at all, is L.R. Barte and Company (Barte, for against the defendant. 6

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From this decision both PLDT and private respondents appealed, Justice Mariano A. Zosa, setting aside the decision dated
the latter appealing only as to the amount of damages. Third-party September 25, 1979, as well as the resolution dated, January
defendant Barte did not appeal. 24,1980, and affirming in toto the decision of the lower court. 17
On September 25, 1979, the Special Second Division of the Court On September 19, 1980, petitioner PLDT filed a motion to set aside
of Appeals rendered a decision in said appealed case, with Justice and/or for reconsideration of the resolution of September 3, 1980,
Corazon Juliano Agrava as ponente, reversing the decision of the contending that the second motion for reconsideration of private
lower court and dismissing the complaint of respondent spouses. It respondent spouses was filed out of time and that the decision of
held that respondent Esteban spouses were negligent and September 25, 1979 penned by Justice Agrava was already final. It
consequently absolved petitioner PLDT from the claim for damages. further submitted therein that the relationship of Barte and
7 A copy of this decision was received by private respondents on petitioner PLDT should be viewed in the light of the contract
October 10, 1979. 8 On October 25, 1979, said respondents filed a between them and, under the independent contractor rule, PLDT is
motion for reconsideration dated October 24, 1979. 9 On January not liable for the acts of an independent contractor. 18 On May 11,
24, 1980, the Special Ninth Division of the Court of Appeals denied 1981, respondent Court of Appeals promulgated its resolution
said motion for reconsideration. 10 This resolution was received by denying said motion to set aside and/or for reconsideration and
respondent spouses on February 22, 1980. 11 affirming in toto the decision of the lower court dated October 1,
On February 29, 1980, respondent Court of Appeals received 1974. 19
private respondents' motion for leave of court to file a second Coming to this Court on a petition for review on certiorari,
motion for reconsideration, dated February 27, 1980. 12 On March petitioner assigns the following errors:
11, 1980, respondent court, in a resolution likewise penned by 1. Respondent Court of Appeals erred in not denying private
Justice Agrava, allowed respondents to file a second motion for respondents' second motion for reconsideration on the ground that
reconsideration, within ten (10) days from notice thereof. 13 Said the decision of the Special Second Division, dated September 25,
resolution was received by private respondents on April 1, 1980 1979, and the resolution of the Special Ninth Division, dated
but prior thereto, private respondents had already filed their January 24, 1980, are already final, and on the additional ground
second motion for reconsideration on March 7, 1980. 14 that said second motion for reconsideration is pro forma.
On April 30,1980 petitioner PLDT filed an opposition to and/or 2. Respondent court erred in reversing the aforesaid decision and
motion to dismiss said second motion for reconsideration. 15 The resolution and in misapplying the independent contractor rule in
Court of Appeals, in view of the divergent opinions on the holding PLDT liable to respondent Esteban spouses.
resolution of the second motion for reconsideration, designated two A convenient resume of the relevant proceedings in the respondent
additional justices to form a division of five. 16 On September 3, court, as shown by the records and admitted by both parties, may
1980, said division of five promulgated its resolution, penned by be graphically presented as follows:

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(a) September 25, 1979, a decision was rendered by notice of the order or judgment deducting the time in which the
the Court of Appeals with Justice Agrava as ponente; first motion has been pending. 20 Private respondents having filed
(b) October 10, 1979, a copy of said decision was their first motion for reconsideration on the last day of the
received by private respondents; reglementary period of fifteen (15) days within which to do so, they
(c) October 25, 1979, a motion for reconsideration had only one (1) day from receipt of the order denying said motion
was filed by private respondents; to file, with leave of court, a second motion for reconsideration. 21
(d) January 24, 1980, a resolution was issued In the present case, after their receipt on February 22, 1980 of the
denying said motion for reconsideration; resolution denying their first motion for reconsideration, private
(e) February 22, 1980, a copy of said denial respondents had two remedial options. On February 23, 1980, the
resolution was received by private respondents; remaining one (1) day of the aforesaid reglementary period, they
(f) February 29, 1980, a motion for leave to file a could have filed a motion for leave of court to file a second motion
second motion for reconsideration was filed by for reconsideration, conceivably with a prayer for the extension of
private respondents the period within which to do so. On the other hand, they could
(g) March 7, 1980, a second motion for have appealed through a petition for review on certiorari to this
reconsideration was filed by private respondents; Court within fifteen (15) days from February 23, 1980. 22 Instead,
(h) March 11, 1980, a resolution was issued allowing they filed a motion for leave to file a second motion 'for
respondents to file a second motion for reconsideration on February 29, 1980, and said second motion for
reconsideration within ten (10) days from receipt; reconsideration on March 7, 1980, both of which motions were by
and then time-barred.
(i) September 3, 1980, a resolution was issued, Consequently, after the expiration on February 24, 1980 of the
penned by Justice Zosa, reversing the original original fifteen (15) day period, the running of which was
decision dated September 25, 1979 and setting suspended during the pendency of the first motion for
aside the resolution dated January 24, 1980. reconsideration, the Court of Appeals could no longer validly take
From the foregoing chronology, we are convinced that both the further proceedings on the merits of the case, much less to alter,
motion for leave to file a second motion for reconsideration and, modify or reconsider its aforesaid decision and/or resolution. The
consequently, said second motion for reconsideration itself were filing of the motion for leave to file a second motion for
filed out of time. reconsideration by herein respondents on February 29, 1980 and
Section 1, Rule 52 of the Rules of Court, which had procedural the subsequent filing of the motion itself on March 7, 1980, after
governance at the time, provided that a second motion for the expiration of the reglementary period to file the same, produced
reconsideration may be presented within fifteen (15) days from no legal effects. Only a motion for re-hearing or reconsideration

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filed in time shall stay the final order or judgment sought to be re- errors should be exercised before the finality of the decision or
examined. 23 order sought to be corrected, otherwise litigation will be endless
The consequential result is that the resolution of respondent court and no question could be considered finally settled. Although the
of March 11, 1980 granting private respondents' aforesaid motion granting or denial of a motion for reconsideration involves the
for leave and, giving them an extension of ten (10) days to file a exercise of discretion, 27 the same should not be exercised
second motion for reconsideration, is null and void. The period for whimsically, capriciously or arbitrarily, but prudently in conformity
filing a second motion for reconsideration had already expired with law, justice, reason and equity. 28
when private respondents sought leave to file the same, and Prescinding from the aforesaid procedural lapses into the
respondent court no longer had the power to entertain or grant the substantive merits of the case, we find no error in the findings
said motion. The aforesaid extension of ten (10) days for private of the respondent court in its original decision that the
respondents to file their second motion for reconsideration was of accident which befell private respondents was due to the lack
no legal consequence since it was given when there was no more of diligence of respondent Antonio Esteban and was not
period to extend. It is an elementary rule that an application for imputable to negligent omission on the part of petitioner
extension of time must be filed prior to the expiration of the period PLDT. Such findings were reached after an exhaustive assessment
sought to be extended. 24 Necessarily, the discretion of respondent and evaluation of the evidence on record, as evidenced by the
court to grant said extension for filing a second motion for respondent court's resolution of January 24, 1980 which we quote
reconsideration is conditioned upon the timeliness of the motion with approval:
seeking the same. First. Plaintiff's jeep was running along the inside
No appeal having been taken seasonably, the respondent court's lane of Lacson Street. If it had remained on that
decision, dated September 25, 1979, became final and executory inside lane, it would not have hit the ACCIDENT
on March 9, 1980. The subsequent resolutions of respondent MOUND.
court, dated March 11, 1980 and September 3, 1980, allowing Exhibit B shows, through the tire marks, that the
private respondents to file a second motion for reconsideration and ACCIDENT MOUND was hit by the jeep swerving
reversing the original decision are null and void and cannot disturb from the left that is, swerving from the inside lane.
the finality of the judgment nor restore jurisdiction to respondent What caused the swerving is not disclosed; but, as
court. This is but in line with the accepted rule that once a the cause of the accident, defendant cannot be made
decision has become final and executory it is removed from the liable for the damages suffered by plaintiffs. The
power and jurisdiction of the court which rendered it to further accident was not due to the absence of warning
alter or amend, much less revoke it. 25 The decision rendered anew signs, but to the unexplained abrupt swerving of the
is null and void. 26 The court's inherent power to correct its own jeep from the inside lane. That may explain plaintiff-

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husband's insistence that he did not see the Fourth. If the accident did not happen because the
ACCIDENT MOUND for which reason he ran into it. jeep was running quite fast on the inside lane and
Second. That plaintiff's jeep was on the inside lane for some reason or other it had to swerve suddenly
before it swerved to hit the ACCIDENT MOUND to the right and had to climb over the ACCIDENT
could have been corroborated by a picture showing MOUND, then plaintiff-husband had not exercised
Lacson Street to the south of the ACCIDENT the diligence of a good father of a family to avoid the
MOUND. accident. With the drizzle, he should not have run
It has been stated that the ditches along Lacson on dim lights, but should have put on his regular
Street had already been covered except the 3 or 4 lights which should have made him see the
meters where the ACCIDENT MOUND was located. ACCIDENT MOUND in time. If he was running on
Exhibit B-1 shows that the ditches on Lacson Street the outside lane at 25 kilometers an hour, even on
north of the ACCIDENT MOUND had already been dim lights, his failure to see the ACCIDENT MOUND
covered, but not in such a way as to allow the outer in time to brake the car was negligence on his part.
lane to be freely and conveniently passable to The ACCIDENT MOUND was relatively big and
vehicles. The situation could have been worse to the visible, being 2 to 3 feet high and 1-1/2 feet wide. If
south of the ACCIDENT MOUND for which reason he did not see the ACCIDENT MOUND in time, he
no picture of the ACCIDENT MOUND facing south would not have seen any warning sign either. He
was taken. knew of the existence and location of the ACCIDENT
Third. Plaintiff's jeep was not running at 25 MOUND, having seen it many previous times. With
kilometers an hour as plaintiff-husband claimed. At ordinary precaution, he should have driven his jeep
that speed, he could have braked the vehicle the on the night of the accident so as to avoid hitting the
moment it struck the ACCIDENT MOUND. The jeep ACCIDENT MOUND. 29
would not have climbed the ACCIDENT MOUND The above findings clearly show that the negligence of respondent
several feet as indicated by the tiremarks in Exhibit Antonio Esteban was not only contributory to his injuries and
B. The jeep must have been running quite fast. If the those of his wife but goes to the very cause of the occurrence of the
jeep had been braked at 25 kilometers an hour, accident, as one of its determining factors, and thereby precludes
plaintiff's would not have been thrown against the their right to recover damages. 30 The perils of the road were known
windshield and they would not have suffered their to, hence appreciated and assumed by, private respondents. By
injuries. exercising reasonable care and prudence, respondent Antonio
Esteban could have avoided the injurious consequences of his act,

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even assuming arguendo that there was some alleged negligence on scene of the accident. The absence of a police report of the incident
the part of petitioner. and the non-submission of a medical report from the hospital
The presence of warning signs could not have completely prevented where private respondents were allegedly treated have not even
the accident; the only purpose of said signs was to inform and been satisfactorily explained.
warn the public of the presence of excavations on the site. The As aptly observed by respondent court in its aforecited extended
private respondents already knew of the presence of said resolution of January 24, 1980
excavations. It was not the lack of knowledge of these excavations (a) There was no third party eyewitness of the
which caused the jeep of respondents to fall into the excavation but accident. As to how the accident occurred, the Court
the unexplained sudden swerving of the jeep from the inside lane can only rely on the testimonial evidence of plaintiffs
towards the accident mound. As opined in some quarters, the themselves, and such evidence should be very
omission to perform a duty, such as the placing of warning signs carefully evaluated, with defendant, as the party
on the site of the excavation, constitutes the proximate cause only being charged, being given the benefit of any doubt.
when the doing of the said omitted act would have prevented the Definitely without ascribing the same motivation to
injury. 31 It is basic that private respondents cannot charge PLDT plaintiffs, another person could have deliberately
for their injuries where their own failure to exercise due and engineered a similar accident in the hope and
reasonable care was the cause thereof. It is both a societal norm expectation that the Court can grant him
and necessity that one should exercise a reasonable degree of substantial moral and exemplary damages from the
caution for his own protection. Furthermore, respondent Antonio big corporation that defendant is. The statement is
Esteban had the last clear chance or opportunity to avoid the made only to stress the disadvantageous position of
accident, notwithstanding the negligence he imputes to petitioner defendant which would have extreme difficulty in
PLDT. As a resident of Lacson Street, he passed on that street contesting such person's claim. If there were no
almost everyday and had knowledge of the presence and location of witness or record available from the police
the excavations there. It was his negligence that exposed him and department of Bacolod, defendant would not be able
his wife to danger, hence he is solely responsible for the to determine for itself which of the conflicting
consequences of his imprudence. testimonies of plaintiffs is correct as to the report or
Moreover, we also sustain the findings of respondent Court of non-report of the accident to the police department.
Appeals in its original decision that there was insufficient evidence 32

to prove any negligence on the part of PLDT. We have for A person claiming damages for the negligence of another has
consideration only the self-serving testimony of respondent Antonio the burden of proving the existence of such fault or negligence
Esteban and the unverified photograph of merely a portion of the causative thereof. The facts constitutive of negligence must be

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affirmatively established by competent evidence. 33 Whosoever
relies on negligence for his cause of action has the burden in
the first instance of proving the existence of the same if
contested, otherwise his action must fail.
WHEREFORE, the resolutions of respondent Court of Appeals,
dated March 11, 1980 and September 3,1980, are hereby SET
ASIDE. Its original decision, promulgated on September 25,1979,
is hereby REINSTATED and AFFIRMED.
SO ORDERED.

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EN BANC fees from P3,000 to P1,000 with costs. The electric company has
[G.R. No. L-8328. May 18, 1956.] appealed said decision to us.
MANILA ELECTRIC COMPANY, Petitioner, vs. SOTERO The findings of fact made by the Court of Appeals which are
REMOQUILLO, in his own behalf and as guardian of the minors conclusive are stated in the following portions of its decision which
MANUEL, BENJAMIN, NESTOR, MILAGROS, CORAZON, we reproduce below:chanroblesvirtuallawlibrary
CLEMENTE and AURORA, all surnamed MAGNO, SALUD The electric wire in question was an exposed, uninsulated primary
MAGNO, and the COURT OF APPEALS (Second Division), wire stretched between poles on the street and carrying a charge of
Respondents. 3,600 volts. It was installed there some two years before Pealozas
house was constructed. The record shows that during the
DECISION construction of said house a similar incident took place, although
MONTEMAYOR, J.: fortunate]y with much less tragic consequences. A piece of wood
On August 22, 1950, Efren Magno went to the 3-story house of which a carpenter was holding happened to come in contact with
Antonio Pealoza, his stepbrother, located on Rodriguez the same wire, producing some sparks. The owner of the house
Lanuza Street, Manila, to repair a media agua said to be in a forthwith complained to Defendant about the danger which the
leaking condition. The media agua was just below the wire presented, and as a result Defendant moved one end of the
window of the third story. Standing on said media agua, wire farther from the house by means of a brace, but left the other
Magno received from his son thru that window a 3 X 6 end where it was.
galvanized iron sheet to cover the leaking portion, turned At any rate, as revealed by the ocular inspection of the premises
around and in doing so the lower end of the iron sheet came ordered by the trial court, the distance from the electric wire to the
into contact with the electric wire of the Manila Electric edge of the media agua on which the deceased was making repairs
Company (later referred to as the Company) strung parallel to was only 30 inches or 2 1/2 feet. Regulations of the City of Manila
the edge of the media agua and 2 1/2 feet from it, causing required that all wires be kept three feet from the building.
his death by electrocution. His widow and children fled suit to Appellant contends that in applying said regulations to the case at
recover damages from the company. After hearing, the trial court bar the reckoning should not be from the edge of the media agua
rendered judgment in their favor P10,000 as compensatory but from the side of the house and that, thus measured, the
damages; chan roblesvirtualawlibraryP784 as actual damages; distance was almost 7 feet, or more then the minimum prescribed.
chan roblesvirtualawlibraryP2,000 as moral and exemplary This contention is manifestly groundless, for not only is a media
damages; chan roblesvirtualawlibraryand P3,000 as attorneys fees, agua an integral part of the building to which it is attached but to
with costs. On appeal to the Court of Appeals, the latter affirmed exclude it in measuring the distance would defeat the purpose of
the judgment with slight modification by reducing the attorneys the regulation. Appellant points out, nevertheless, that even

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assuming that the distance, within the meaning of the city house; chan roblesvirtualawlibrarythat it was the company that
regulations, should be measured from the edge of the media agua, was at fault and was guilty of negligence because although the
the fact that in the case of the house involved herein such distance electric wire in question had been installed long before the
was actually less than 3 feet was due to the fault of the owner of construction of the house and in accordance with the ordinance
said house, because the city authorities gave him a permit to fixing a minimum of 3 feet, mere compliance with the regulations
construct a media agua only one meter or 39 1/2 inches wide, but does not satisfy the requirement of due diligence nor avoid the
instead he built one having a width of 65 3/4 inches, 17 3/8 need for adopting such other precautionary measures as may be
inches more than the width permitted by the authorities, thereby warranted; chan roblesvirtualawlibrarythat negligence cannot be
reducing the distance to the electric wire to less than the determined by a simple matter of inches; chan
prescribed minimum of 3 feet. roblesvirtualawlibrarythat all that the city did was to prescribe
It is a fact that the owner of the house exceeded the limit fixed in certain minimum conditions and that just because the ordinance
the permit given to him by the city authorities for the construction required that primary electric wires should be not less than 3 feet
of the media agua, and that if he had not done so Appellants wire from any house, the obligation of due diligence is not fulfilled by
would have been 11 3/8 (inches) more than the required distance placing such wires at a distance of 3 feet and one inch, regardless
of three feet from the edge of the media agua. It is also a fact, of other factors. The appellate court, however, refrained from
however, that after the media agua was constructed the owner stating or suggesting what other precautionary measures could
was given a final permit of occupancy of the house cralaw . and should have been adopted.
cralaw The wire was an exposed, high tension wire carrying a After a careful study and discussion of the case and the
load of 3,600 volts. There was, according to Appellant, no circumstances surrounding the same, we are inclined to agree to
insulation that could have rendered it safe, first, because there is the contention of Petitioner Company that the death of Magno was
no insulation material in commercial use for such kind of wire; primarily caused by his own negligence and in some measure by
chan roblesvirtualawlibraryand secondly, because the only the too close proximity of the media agua or rather its edge to the
insulation material that may be effective is still in the experimental electric wire of the company by reason of the violation of the
stage of development and, anyway, its costs would be prohibitive original permit given by the city and the subsequent approval of
said illegal construction of the media agua. We fail to see how the
The theory followed by the appellate court in finding for the Plaintiff Company could be held guilty of negligence or as lacking in due
is that although the owner of the house in constructing the media diligence. Although the city ordinance called for a distance of 3 feet
agua in question exceeded the limits fixed in the permit, still, after of its wires from any building, there was actually a distance of 7
making that media agua, its construction though illegal, was feet and 2 3/4 inches of the wires from the side of the house of
finally approved because he was given a final permit to occupy the Pealoza. Even considering said regulation distance of 3 feet as

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referring not to the side of a building, but to any projecting part edge of the media agua and the yawning 2-story distance or
thereof, such as a media agua, had the house owner followed the height from the ground, and possibly if not probably avoided the
terms of the permit given him by the city for the construction of his fatal contact between the lower end of the iron sheet and the wires.
media agua, namely, one meter or 39 3/8 inches wide, the We realize that the presence of the wires in question quite close to
distance from the wires to the edge of said media agua would the house or its media agua was always a source of danger
have been 3 feet and 11 3/8 inches. In fixing said one meter width considering their high voltage and uninsulated as they were, but
for the media agua the city authorities must have wanted to the claim of the company and the reasons given by it for not
preserve the distance of at least 3 feet between the wires and any insulating said wires were unrefuted as we gather from the findings
portion of a building. Unfortunately, however, the house owner of the Court of Appeals, and so we have to accept them as
disregarding the permit, exceeded the one meter fixed by the same satisfactory. Consequently, we may not hold said company as
by 17 3/8 inches and leaving only a distance of 2 1/2 feet between guilty of negligence or wanting in due diligence in failing to insulate
the Media agua as illegally constructed and the electric wires. said wires. As to their proximity to the house it is to be supposed
And added to this violation of the permit by the house owner, was that distance of 3 feet was considered sufficiently safe by the
its approval by the city through its agent, possibly an inspector. technical men of the city such as its electrician or engineer. Of
Surely we cannot lay these serious violations of a city ordinance course, a greater distance of say 6 feet or 12 feet would have
and permit at the door of the Company, guiltless of breach of any increased the margin of safety but other factors had to be
ordinance or regulation. The Company cannot be expected to be considered such as that the wires could not be strung or the posts
always on the lookout for any illegal construction which reduces supporting them could not be located too far toward the middle of
the distance between its wires and said construction, and after the street. Thus, the real cause of the accident or death was the
finding that said distance of 3 feet had been reduced, to change the reckless or negligent act of Magno himself. When he was called by
stringing or installation of its wires so as to preserve said distance. his stepbrother to repair the media agua just below the third
It would be much easier for the City, or rather it is its duty, to be story window, it is to be presumed that due to his age and
ever on the alert and to see to it that its ordinances are strictly experience he was qualified to do so. Perhaps he was a tinsmith or
followed by house owners and to condemn or disapprove all illegal carpenter and had training and experience for the job. So, he could
constructions. Of course, in the present case, the violation of the not have been entirely a stranger to electric wires and the danger
permit for the construction of the media agua was not the direct lurking in them. But unfortunately, in the instant care, his training
cause of the accident. It merely contributed to it. Had said media and experience failed him, and forgetting where he was standing,
agua been only one meter wide as allowed by the permit, Magno holding the 6-feet iron sheet with both hands and at arms length,
standing on it, would instinctively have stayed closer to or hugged evidently without looking, and throwing all prudence and
the side of the house in order to keep a safe margin between the

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discretion to the winds, he turned around swinging his arms with nevertheless such companies are not insurers of the safety of the
the motion of his body, thereby causing his own electrocution. public.
In support of its theory and holding that Defendant-Appellant was But even assuming for a moment that under the facts of the
liable for damages the Court of Appeals cites the case of Astudillo present case the Defendant electric company could be considered
vs. Manila Electric Co., 55 Phil., 427. We do not think the case is negligent in installing its electric wires so close to the house and
exactly applicable. There, the premises involved was that elevated media agua in question, and in failing to properly insulate those
portion or top of the walls of Intramuros, Manila, just above the wires (although according to the unrefuted claim of said company
Sta. Lucia Gate. In the words of the Court, it was a public place it was impossible to make the insulation of that kind of wire),
where persons come to stroll, to rest and to enjoy themselves. The nevertheless to hold the Defendant liable in damages for the death
electric company was clearly negligent in placing its wires so near of Magno, such supposed negligence of the company must have
the place that without much difficulty or exertion, a person by been the proximate and principal cause of the accident,
stretching his hand out could touch them. A boy named Astudillo, because if the act of Magno in turning around and swinging the
placing one foot on a projection, reached out and actually grasped galvanized iron sheet with his hands was the proximate and
the electric wire and was electrocuted. The person electrocuted in principal cause of the electrocution, then his heirs may not
said case was a boy who was in no position to realize the danger. recover. Such was the holding of this Court in the case of Taylor
In the present case, however, the wires were well high over the vs. Manila Electric Railroad and Light Company, 16 Phil., 8. In that
street where there was no possible danger to pedestrians. The only case, the electric company was found negligent in leaving scattered
possible danger was to persons standing on the media agua, but on its premises fulminating caps which Taylor, a 15- year old boy
a media agua can hardly be considered a public place where found and carried home. In the course of experimenting with said
persons usually gather. Moreover, a person standing on the media fulminating caps, he opened one of them, held it out with his
agua could not have reached the wires with his hands alone. It hands while another boy applied a lighted match to it, causing it to
was necessary as was done by Magno to hold something long explode and injure one of his eyes eventually causing blindness in
enough to reach the wire. Furthermore, Magno was not a boy or a said eye. Said this Tribunal in denying recovery for the
person immature but the father of a family, supposedly a tinsmith injury:chanroblesvirtuallawlibrary
trained and experienced in the repair of galvanized iron roofs and cralaw, so that while it may be true that these injuries would
media agua. Moreover, in that very case of Astudillo vs. Manila not have been incurred but for the negligent act of the
Electric Co., supra, the court said that although it is a well- Defendant in leaving the caps exposed on its premises,
established rule that the liability of electric companies for damages nevertheless Plaintiffs own act was the proximate and
or personal injuries is governed by the rules of negligence, principal cause of the accident which inflicted the injury.

Page 12 of 205
To us it is clear that the principal and proximate cause of the thoroughfares may greatly minimize danger to pedestrians because
electrocution was not the electric wire, evidently a remote cause, drivers of motor vehicles may expect danger and slow down or even
but rather the reckless and negligent act of Magno in turning stop and take other necessary precaution upon approaching said
around and swinging the galvanized iron sheet without taking any lanes, so, a similar way may possibly be found. Since these high
precaution, such as looking back toward the street and at the wire voltage wires cannot be properly insulated and at reasonable cost,
to avoid its contacting said iron sheet, considering the latters they might perhaps be strung only up to the outskirts of the city
length of 6 feet. For a better understanding of the rule on where there are few houses and few pedestrians and there step-
remote and proximate cause with respect to injuries, we find down to a voltage where the wires carrying the same to the city
the following citation helpful:chanroblesvirtuallawlibrary could be properly insulated for the better protection of the public.
A prior and remote cause cannot be made the basis of an In view of all the foregoing, the appealed decision of the Court of
action if such remote cause did nothing more than furnish the Appeals is hereby reversed and the complaint filed against the
condition or give rise to the occasion by which the injury was Company is hereby dismissed. No costs.
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.).
We realize that the stringing of wires of such high voltage (3,600
volts), uninsulated and so close to houses is a constant source of
danger, even death, especially to persons who having occasion to
be near said wires, do not adopt the necessary precautions. But
may be, the City of Manila authorities and the electric company
could get together and devise means of minimizing this danger to
the public. Just as the establishment of pedestrian lanes in city

Page 13 of 205
Republic of the Philippines favor but deducted from the total damages awarded 25% thereof
SUPREME COURT for the decedent's contributory negligence and the total pension of
Manila P41,367.60 private respondent and her children would be receiving
FIRST DIVISION from the SSS for the next five years. The dispositive portion of the
G.R. No. 83491 August 27, 1990 decision read:
MA-AO SUGAR CENTRAL CO., INC. and GUILLERMO ARANETA, WHEREFORE, in view of the foregoing facts and
petitioners, circumstances present in this case, the Court order,
vs. as it does hereby order the defendant Ma-ao Sugar
HON. COURT OF APPEALS and HERMINIA FAMOSO, Central thru its Manager Mr. Guillermo Y. Araneta
respondents. to pay plaintiff the following amount:
Jalandoni, Herrera, Del Castillo & Associates for petitioners. P30,000.00 for the death of plaintiff's husband,
Napoleon Corral for private respondent. the late
Julio Famoso
CRUZ, J.: P30,000.00 for actual, exemplary and moral
To say the least, the Court views with regret the adamant refusal of damages
petitioner Ma-ao Sugar Central to recompense the private P10,000.00 loss of earnings for twenty (20) years
respondent for the death of Julio Famoso, their main source of P3,000.00 funeral expenses
support, who was killed in line of duty while in its employ. It is not
only a matter of law but also of compassion on which we are called P73,000.00 Total Damages
upon to rule today. We shall state at the outset that on both Less: P18,250.00 25% for the deceased's
counts the petition must fail. contributory
On March 22, 1980, Famoso was riding with a co-employee in the negligence
caboose or "carbonera" of Plymouth No. 12, a cargo train of the Less: P41,367.60 pension plaintiff and her minor
petitioner, when the locomotive was suddenly derailed. He and his children would
companion jumped off to escape injury, but the train fell on its
side, caught his legs by its wheels and pinned him down. He was be receiving for five (5) years from the SSS
declared dead on the spot. 1 Pl3,382.40
The claims for death and other benefits having been denied by the Plus: P3,000.00 Attorney's fees and cost of this
petitioner, the herein private respondent filed suit in the Regional suit
Trial Court of Bago City. Judge Marietta Hobilla-Alinio ruled in her

Page 14 of 205
Pl6,382.40 Total amount payable to the plaintiff. thick which are attached to the rails by 4 bolts, two on each side,
to keep the rails aligned. Although they could be removed only with
SO ORDERED. special equipment, the fish plates that should have kept the rails
The widow appealed, claiming that the deductions were illegal. So aligned could not be found at the scene of the accident.
did the petitioner, but on the ground that it was not negligent and There is no question that the maintenance of the rails, for the
therefore not liable at all. purpose inter alia of preventing derailments, was the responsibility
In its own decision, the Court of Appeals 2 sustained the rulings of of the petitioner, and that this responsibility was not discharged.
the trial court except as to the contributory negligence of the According to Jose Treyes, its own witness, who was in charge of the
deceased and disallowed the deductions protested by the private control and supervision of its train operations, cases of derailment
respondent. Thus, the respondent court declared: in the milling district were frequent and there were even times
WHEREFORE, the decision appealed from is when such derailments were reported every hour. 3 The petitioner
MODIFIED by ordering the defendant-appellant to should therefore have taken more prudent steps to prevent such
pay the plaintiff-appellee the following amounts: accidents instead of waiting until a life was finally lost because of
P30,000.00, for the death of Julio Famoso its negligence.
P30,000.00, for actual, exemplary and moral The argument that no one had been hurt before because of such
damages derailments is of course not acceptable. And neither are we
P10,000.00, for loss of earnings for twenty (20) years impressed by the claim that the brakemen and the conductors
P3,000.00, for funeral expenses were required to report any defect in the condition of the railways
P3,000.00, for attorney's fees and to fill out prescribed forms for the purpose. For what is
important is that the petitioner should act on these reports and not
P76,000.00 Total Amount merely receive and file them. The fact that it is not easy to detect if
======== the fish plates are missing is no excuse either. Indeed, it should
In this petition, the respondent court is faulted for finding the stress all the more the need for the responsible employees of the
petitioner guilty of negligence notwithstanding its defense of due petitioner to make periodic checks and actually go down to the
diligence under Article 2176 of the Civil Code and for disallowing railroad tracks and see if the fish plates were in place.
the deductions made by the trial court. It is argued that the locomotive that was derailed was on its way
Investigation of the accident revealed that the derailment of the back and that it had passed the same rails earlier without
locomotive was caused by protruding rails which had come loose accident. The suggestion is that the rails were properly aligned
because they were not connected and fixed in place by fish plates. then, but that does not necessarily mean they were still aligned
Fish plates are described as strips of iron 8" to 12" long and 3 1/2" afterwards. It is possible that the fish plates were loosened and

Page 15 of 205
detached during its first trip and the rails were as a result already We also do not see how the decedent can be held guilty of
mis-aligned during the return trip. But the Court feels that even contributory negligence from the mere fact that he was not at his
this was unlikely, for, as earlier noted, the fish plates were assigned station when the train was derailed. That might have
supposed to have been bolted to the rails and could be removed been a violation of company rules but could not have directly
only with special tools. The fact that the fish plates were not found contributed to his injury, as the petitioner suggests. It is pure
later at the scene of the mishap may show they were never there at speculation to suppose that he would not have been injured if he
all to begin with or had been removed long before. had stayed in the front car rather than at the back and that he had
At any rate, the absence of the fish plates whatever the cause or been killed because he chose to ride in the caboose.
reason is by itself alone proof of the negligence of the petitioner. Contributory negligence has been defined as "the act or
Res ipsa loquitur. The doctrine was described recently in Layugan omission amounting to want of ordinary care on the part of
v. Intermediate Appellate Court, 4 thus: the person injured which, concurring with the defendant's
Where the thing which causes injury is shown to negligence, is the proximate cause of the
be under the management of the defendant, and injury." 5 It has been held that "to hold a person as having
the accident is such as in the ordinary course of contributed to his injuries, it must be shown that he
things does not happen if those who have the performed an act that brought about his injuries in disregard
management use proper care, it affords of warnings or signs of an impending danger to health and
reasonable evidence, in the absence of an body." 6 There is no showing that the caboose where Famoso
explanation by the defendant, that the accident was riding was a dangerous place and that he recklessly dared
arose from want of care. to stay there despite warnings or signs of impending danger.
The petitioner also disclaims liability on the ground of Article 2176 The last point raised by the petitioner is easily resolved. Citing the
of the Civil Code, contending it has exercised due diligence in the case of Floresca v. Philex Mining Corporation, 7 it argues that the
selection and supervision of its employees. The Court cannot agree. respondent court erred in disauthorizing the deduction from the
The record shows it was in fact lax in requiring them to exercise total damages awarded the private respondent of the amount of
the necessary vigilance in maintaining the rails in good condition P41,367.60, representing the pension to be received by the private
to prevent the derailments that sometimes happened "every hour." respondent from the Social Security System for a period of five
Obviously, merely ordering the brakemen and conductors to fill out years. The argument is that such deduction was quite proper
prescribed forms reporting derailments-which reports have not because of Art. 173 of the Labor Code, as amended. This article
been acted upon as shown by the hourly derailments is-not the provides that any amount received by the heirs of a deceased
kind of supervision envisioned by the Civil Code. employee from the Employees Compensation Commission, whose
funds are administered by the SSS, shall be exclusive of all other

Page 16 of 205
amounts that may otherwise be claimed under the Civil Code and
other pertinent laws. S
The amount to be paid by the SSS represents the usual pension .
received by the heirs of a deceased employee who was a member of
the SSS at the time of his death and had regularly contributed his S
premiums as required by the System. The pension is the benefit I
derivable from such contributions. It does not represent the death S
benefits payable under the Workmen's Compensation Act to an O
employee who dies as a result of a work-connected injury. Indeed, N
the certification from the SSS 8 submitted by the petitioner is R
simply to the effect that: e
TO WHOM IT MAY CONCERN: g
This is to certify that Mrs. Herminia Vda. de Famoso i
is a recipient of a monthly pension from the Social o
Security System arising from the death of her late n
husband, Julio Famoso, an SSS member with SSS a
No. 07-018173-1. l
This certification is issued to Ma-ao Sugar Central
for whatever legal purpose it may serve best. M
Issued this 8th day of April 1983 in Bacolod City, a
Philippines. n
G a
O g
D e
O r
F B
R y
E :
D
O (

Page 17 of 205
S f
G ,
D
. B
) e
n
C e
O f
S i
M t
E s

Q B
. r
a
B n
E c
R h
It doesMnot indicate that the pension is to be taken from the funds
of theEECC. The certification would have said so if the pension
represented
O the death benefits accruing to the heirs under the
Workmen's
, Compensation Act.
This conclusion is supported by the express provision of Art. 173
as amended,
J which categorically states that:
R Art. 173. Exclusiveness of liability. Unless
. otherwise provided, the liability of the State
C Insurance Fund under this Title shall be exclusive
h and in place of all other liabilities of the employer to
i the employee, his dependents or anyone otherwise
e entitled to receive damages on behalf of the

Page 18 of 205
employee or his dependents. The payment of arising in the course of the employment because the
compensation under this Title shall not bar the industry is supposed to be responsible therefore;
recovery of benefits as provided for in Section 699 of whereas, under the Social Security Act, payment is
the Revised Administrative Code, Republic Act being made because the hazard specifically covered
Numbered Eleven hundred sixty-one, as amended, by the membership, and for which the employee had
Commonwealth Act Numbered One hundred eighty- put up his own money, had taken place. As this
six, as amended, Republic Act Numbered Six Court had said:
hundred ten, as amended, Republic Act Numbered . . . To deny payment of social
Forty-eight hundred sixty-four, as amended and security benefits because the death or
other laws whose benefits are administered by the injury or confinement is compensable
System or by other agencies of the government. under the Workmen's Compensation
(Emphasis supplied). Act would be to deprive the employees
Rep. Act No. 1161, as amended, is the Social Security Law. members of the System of the
As observed by Justice J.B.L. Reyes in the case of Valencia v. statutory benefits bought and paid for
Manila Yacht Club, 9 which is still controlling: by them, since they contributed their
. . . By their nature and purpose, the sickness or money to the general common fund
disability benefits to which a member of the System out of which benefits are paid. In
may be entitled under the Social Security law (Rep. other words, the benefits provided for
Act No. 1161, as amended by Rep. Acts Nos. 1792 in the Workmen's Compensation Act
and 2658) are not the same as the compensation accrues to the employees concerned
that may be claimed against the employer under the due to the hazards involved in their
Workmen's Compensation Act or the Civil Code, so employment and is made a burden on
that payment to the member employee of social the employment itself However, social
security benefits would not wipe out or extinguish security benefits are paid to the
the employer's liability for the injury or illness System's members, by reason of their
contracted by his employee in the course of or membership therein for which they
during the employment. It must be realized that, contribute their money to a general
under the Workmen's Compensation Act (or the Civil common fund . . . .
Code, in a proper case), the employer is required to It may be added that whereas social
compensate the employee for the sickness or injury security benefits are intended to

Page 19 of 205
provide insurance or protection deprive the employees-members of the System of the
against the hazards or risks for which statutory benefits bought and paid for by them,
they are established, e.g., disability, since they contribute their money to the general
sickness, old age or death, common fund out of which benefits are paid. In
irrespective of whether they arose other words, the benefits provided for in the
from or in the course of the Workmen's Compensation Act accrues to the
employment or not, the compensation employees concerned, due to the hazards involved in
receivable under the Workmen's their employment and is made a burden on the
Compensation law is in the nature of employment itself However, social security benefits
indemnity for the injury or damage are paid to the System's members, by reason of their
suffered by the employee or his membership therein for which they contributed their
dependents on account of the money to a general common fund.
employment. (Rural Transit Famoso's widow and nine minor children have since his death
Employees Asso. vs. Bachrach Trans. sought to recover the just recompense they need for their support.
Co., 21 SCRA 1263 [19671]) Instead of lending a sympathetic hand, the petitioner has sought to
And according to Justice Jesus G. Barrera in Benguet frustrate their efforts and has even come to this Court to seek our
Consolidated, Inc. v. Social Security System:" 10 assistance in defeating their claim. That relief-and we are happy to
The philosophy underlying the Workmen's say this must be withheld.
Compensation Act is to make the payment of the WHEREFORE, the appealed decision is AFFIRMED in toto. The
benefits provided for therein as a responsibility of petition is DENIED, with costs against the petitioner.
the industry, on the ground that it is industry which SO ORDERED.
should bear the resulting death or injury to
employees engaged in the said industry. On the
other hand, social security sickness benefits are not
paid as a burden on the industry, but are paid to
the members of the System as a matter of right,
whenever the hazards provided for in the law occurs.
To deny payment of social security benefits because
the death or injury or confinement is compensable
under the Workmen's Compensation Act would be to

Page 20 of 205
Republic of the Philippines as "novel" by the petitioner: whether Article 2185 of the New
SUPREME COURT Civil Code, which presumes the driver of a motor vehicle
Manila negligent if he was violating a traffic regulation at the time of
SECOND DIVISION the mishap, should apply by analogy to non-motorized
G.R. No. 130003 October 20, 2004 vehicles.1
JONAS AONUEVO, Petitioner. As found by the RTC, and affirmed by the Court of Appeals, the
vs. accident in question occurred on 8 February 1989, at around nine
HON. COURT OF APPEALS and JEROME VILLAGRACIA, in the evening, at the intersection of Boni Avenue and Barangka
Respondent. Drive in Mandaluyong (now a city). Villagracia was traveling along
DECISION Boni Avenue on his bicycle, while Aonuevo, traversing the
TINGA, J.: opposite lane was driving his Lancer car with plate number PJJ
The bicycle provides considerable speed and freedom of movement 359. The car was owned by Procter and Gamble Inc., the employer
to the rider. It derives a certain charm from being unencumbered of Aonuevos brother, Jonathan. Aonuevo was in the course of
by any enclosure, affording the cyclist the perception of relative making a left turn towards Libertad Street when the collision
liberty. It also carries some obvious risks on the part of the user occurred. Villagracia sustained serious injuries as a result, which
and has become the subject of regulation, if not by the government, necessitated his hospitalization several times in 1989, and forced
then by parental proscription. him to undergo four (4) operations.
The present petition seeks to bar recovery by an injured cyclist of On 26 October 1989, Villagracia instituted an action for damages
damages from the driver of the car which had struck him. The against Procter and Gamble Phils., Inc. and Aonuevo before the
argument is hinged on the cyclists failure to install safety devices RTC.2 He had also filed a criminal complaint against Aonuevo
on his bicycle. However, the lower courts agreed that the motorist before the Metropolitan Trial Court of Mandaluyong, but the latter
himself caused the collision with his own negligence. The facts are was subsequently acquitted of the criminal charge. 3 Trial on the
deceptively simple, but the resolution entails thorough civil action ensued, and in a Decision dated 9 March 1990, the RTC
consideration of fundamental precepts on negligence. rendered judgment against Procter and Gamble and Aonuevo,
The present petition raises little issue with the factual findings of ordering them to pay Villagracia the amounts of One Hundred Fifty
the Regional Trial Court (RTC), Branch 160, of Pasig City, as Thousand Pesos (P150, 000.00). for actual damages, Ten Thousand
affirmed by the Court of Appeals. Both courts adjudged petitioner, Pesos (P10,000.00) for moral damages, and Twenty Thousand
Jonas Aonuevo ( Aonuevo ), liable for the damages for the Pesos (P20,000.00) for attorneys fees, as well as legal costs. 4 Both
injuries sustained by the cyclist, Jerome Villagracia (Villagracia). defendants appealed to the Court of Appeals.
Instead, the petition hinges on a sole legal question, characterized

Page 21 of 205
In a Decision5 dated 8 May 1997, the Court of Appeals Fourth Notwithstanding, the present petition presents interesting
Division affirmed the RTC Decision in toto6. After the Court of questions for resolution. Aonuevos arguments are especially
Appeals denied the Motion for Reconsideration in a Resolution7 fixated on a particular question of law: whether Article 2185 of the
dated 22 July 1997, Procter and Gamble and Aonuevo filed their New Civil Code should apply by analogy to non-motorized
respective petitions for review with this Court. Procter and vehicles.17 In the same vein, Aonuevo insists that Villagracias
Gambles petition was denied by this Court in a Resolution dated own fault and negligence serves to absolve the former of any
24 November 1997. Aonuevos petition, 8 on the other hand, was liability for damages.
given due course,9 and is the subject of this Decision. Its is easy to discern why Aonuevo chooses to employ this line of
In arriving at the assailed Decision, the Court of Appeals affirmed argument. Aonuevo points out that Villagracias bicycle had no
the factual findings of the RTC. Among them: that it was safety gadgets such as a horn or bell, or headlights, as invoked by
Aonuevos vehicle which had struck Villagracia;10 that Aonuevos a 1948 municipal ordinance.18 Nor was it duly registered with the
vehicle had actually hit Villagracias left mid-thigh, thus causing a Office of the Municipal Treasurer, as required by the same
comminuted fracture;11 that as testified by eyewitness Alfredo ordinance. Finally, as admitted by Villagracia, his bicycle did not
Sorsano, witness for Villagracia, Aonuevo was "umaarangkada," have foot brakes.19 Before this Court, Villagracia does not dispute
or speeding as he made the left turn into Libertad; 12 that these allegations, which he admitted during the trial, but directs
considering Aonuevos claim that a passenger jeepney was our attention instead to the findings of Aonuevos own
obstructing his path as he made the turn. Aonuevo had enough negligence.20 Villagracia also contends that, assuming there was
warning to control his speed;13 and that Aonuevo failed to contributory negligence on his part, such would not exonerate
exercise the ordinary precaution, care and diligence required of Aonuevo from payment of damages. The Court of Appeals likewise
him in order that the accident could have been avoided. 14 Notably, acknowledged the lack of safety gadgets on Villagracias bicycle,
Aonuevo, in his current petition, does not dispute the findings of but characterized the contention as "off-tangent" and insufficient to
tortious conduct on his part made by the lower courts, hinging his obviate the fact that it was Aonuevos own negligence that caused
appeal instead on the alleged negligence of Villagracia. Aonuevo the accident.21
proffers no exculpatory version of facts on his part, nor does he Aonuevo claims that Villagracia violated traffic regulations when
dispute the conclusions made by the RTC and the Court of he failed to register his bicycle or install safety gadgets thereon. He
Appeals. Accordingly, the Court, which is not a trier of facts, 15 is posits that Article 2185 of the New Civil Code applies by analogy.
not compelled to review the factual findings of the lower courts, The provision reads:
which following jurisprudence have to be received with respect and Article 2185. Unless there is proof to the contrary, it is
are in fact generally binding.16 presumed that a person driving a motor vehicle has been

Page 22 of 205
negligent if at the time of the mishap he was violating any Article 2185 with the use of the term "motorized vehicles." If
traffic regulation. Aonuevo seriously contends that the application of Article 2185
The provision was introduced for the first time in this jurisdiction be expanded due to the greater interaction today of all types of
with the adoption in 1950 of the New Civil Code.22 Its applicability vehicles, such argument contradicts historical experience. The
is expressly qualified to motor vehicles only, and there is no ground ratio of motorized vehicles as to non-motorized vehicles, as it stood
to presume that the law intended a broader coverage. in 1950, was significantly lower than as it stands today. This will
Still, Aonuevo hypothesizes that Article 2185 should apply by be certainly affirmed by statistical data, assuming such has been
analogy to all types of vehicles23. He points out that modern-day compiled, much less confirmed by persons over sixty. Aonuevos
travel is more complex now than when the Code was enacted, the characterization of a vibrant intra-road dynamic between motorized
number and types of vehicles now in use far more numerous than and non-motorized vehicles is more apropos to the past than to the
as of then. He even suggests that at the time of the enactment of present.
the Code, the legislators "must have seen that only motor vehicles There is a fundamental flaw in Aonuevos analysis of Art. 2185, as
were of such public concern that they had to be specifically applicable today. He premises that the need for the distinction
mentioned," yet today, the interaction of vehicles of all types and between motorized and non-motorized vehicles arises from the
nature has "inescapably become matter of public concern" so as to relative mass of number of these vehicles. The more pertinent basis
expand the application of the law to be more responsive to the for the segregate classification is the difference in type of these
times.24 vehicles. A motorized vehicle operates by reason of a motor engine
What Aonuevo seeks is for the Court to amend the explicit unlike a non-motorized vehicle, which runs as a result of a direct
command of the legislature, as embodied in Article 2185, a task exertion by man or beast of burden of direct physical force. A
beyond the pale of judicial power. The Court interprets, and not motorized vehicle, unimpeded by the limitations in physical
creates, the law. However, since the Court is being asked to exertion. is capable of greater speeds and acceleration than non-
consider the matter, it might as well examine whether Article 2185 motorized vehicles. At the same time, motorized vehicles are more
could be interpreted to include non-motorized vehicles. capable in inflicting greater injury or damage in the event of an
At the time Article 2185 was formulated, there existed a whole accident or collision. This is due to a combination of factors
array of non-motorized vehicles ranging from human-powered peculiar to the motor vehicle, such as the greater speed, its relative
contraptions on wheels such as bicycles, scooters, and animal- greater bulk of mass, and greater combustability due to the fuels
drawn carts such as calesas and carromata. These modes of that they use.
transport were even more prevalent on the roads of the 1940s and There long has been judicial recognition of the peculiar dangers
1950s than they are today, yet the framers of the New Civil Code posed by the motor vehicle. As far back as 1912, in the U.S. v.
chose then to exclude these alternative modes from the scope of Juanillo25, the Court has recognized that an automobile is capable

Page 23 of 205
of great speed, greater than that of ordinary vehicles hauled by ensure obeisance by all to traffic rules and regulations. If such
animals, "and beyond doubt it is highly dangerous when used on were indeed the evil sought to be remedied or guarded against,
country roads, putting to great hazard the safety and lives of the then the framers of the Code would have expanded the provision to
mass of the people who travel on such roads."26 In the same case, include non-motorized vehicles or for that matter, pedestrians. Yet,
the Court emphasized: that was not the case; thus the need arises to ascertain the
A driver of an automobile, under such circumstances, is required peculiarities attaching to a motorized vehicle within the dynamics
to use a greater degree of care than drivers of animals, for the of road travel. The fact that there has long existed a higher degree
reason that the machine is capable of greater destruction, and of diligence and care imposed on motorized vehicles, arising from
furthermore, it is absolutely under the power and control of the the special nature of motor vehicle, leads to the inescapable
driver; whereas, a horse or other animal can and does to some conclusion that the qualification under Article 2185 exists precisely
extent aid in averting an accident. It is not pleasant to be obliged to to recognize such higher standard. Simply put, the standards
slow down automobiles to accommodate persons riding, driving, or applicable to motor vehicle are not on equal footing with other
walking. It is probably more agreeable to send the machine along types of vehicles.
and let the horse or person get out of the way in the best manner Thus, we cannot sustain the contention that Art. 2185 should
possible; but it is well to understand, if this course is adopted and apply to non-motorized vehicles, even if by analogy. There is factual
an accident occurs, that the automobile driver will be called upon and legal basis that necessitates the distinction under Art. 2185,
to account for his acts. An automobile driver must at all times use and to adopt Aonuevos thesis would unwisely obviate this
all the care and caution which a careful and prudent driver would distinction.
have exercised under the circumstances. 27 Even if the legal presumption under Article 2185 should not apply
American jurisprudence has had occasion to explicitly rule on the to Villagracia, this should not preclude any possible finding of
relationship between the motorist and the cyclist. Motorists are negligence on his part. While the legal argument as formulated by
required to exercise ordinary or reasonable care to avoid collision Aonuevo is erroneous, his core contention that Villagracia was
with bicyclists.28 While the duty of using ordinary care falls alike negligent for failure to comply with traffic regulations warrants
on the motorist and the rider or driver of a bicycle, it is obvious, for serious consideration, especially since the imputed negligent acts
reasons growing out of the inherent differences in the two vehicles, were admitted by Villagracia himself.
that more is required from the former to fully discharge the duty The Civil Code characterizes negligence as the omission of
than from the latter.29 that diligence which is required by the nature of the obligation
The Code Commission was cognizant of the difference in the and corresponds with the circumstances of the persons, of the
natures and attached responsibilities of motorized and non- time and of the place.30 However, the existence of negligence
motorized vehicles. Art. 2185 was not formulated to compel or in a given case is not determined by the personal judgment of

Page 24 of 205
the actor in a given situation, but rather, it is the law which violated, whether the act or omission constituting such violation
determines what would be reckless or negligent.31 would have been regarded as negligence in the absence of any
Aonuevo, asserts that Villagracia was negligent as the latter had statute on the subject or whether there was, as a matter of fact,
transgressed a municipal ordinance requiring the registration of any reason to anticipate that injury would result from such
bicycles and the installation of safety devices thereon. This view violation. x x x." (65 C.J.S. pp.623-628)
finds some support if anchored on the long standing principle of "But the existence of an ordinance changes the situation. If a driver
negligence per se. causes an accident by exceeding the speed limit, for example, we
The generally accepted view is that the violation of a statutory duty do not inquire whether his prohibited conduct was unreasonably
constitutes negligence, negligence as a matter of law, or negligence dangerous. It is enough that it was prohibited. Violation of an
per se.32 In Teague vs. Fernandez,33 the Court cited with approval ordinance intended to promote safety is negligence. If by
American authorities elucidating on the rule: creating the hazard which the ordinance was intended to avoid it
"The mere fact of violation of a statute is not sufficient basis for an brings about the harm which the ordinance was intended to
inference that such violation was the proximate cause of the injury prevent, it is a legal cause of the harm. This comes only to saying
complained. However, if the very injury has happened which was that in such circumstances the law has no reason to ignore the
intended to be prevented by the statute, it has been held that causal relation which obviously exists in fact. The law has
violation of the statute will be deemed to be the proximate cause of excellent reason to recognize it, since it is the very relation which
the injury." (65 C.J.S. 1156) the makers of the ordinance anticipated. This court has applied
"The generally accepted view is that violation of a statutory duty these principles to speed limits and other regulations of the
constitutes negligence, negligence as a matter of law, or, according manner of driving." (Ross vs. Hartman, 139 Fed. 2d 14 at 15).
to the decisions on the question, negligence per se, for the reason "x x x However, the fact that other happenings causing or
that non-observance of what the legislature has prescribed as a contributing toward an injury intervened between the violation of a
suitable precaution is failure to observe that care which an statute or ordinance and the injury does not necessarily make the
ordinarily prudent man would observe, and, when the state regards result so remote that no action can be maintained. The test is to
certain acts as so liable to injure others as to justify their absolute be found not in the number of intervening events or agents,
prohibition, doing the forbidden act is a breach of duty with but in their character and in the natural and probable
respect to those who may be injured thereby; or, as it has been connection between the wrong done and the injurious
otherwise expressed, when the standard of care is fixed by law, consequence. The general principle is that the violation of a
failure to conform to such standard is negligence, negligence per se statute or ordinance is not rendered remote as the cause of an
or negligence in and of itself, in the absence of a legal excuse. injury by the intervention of another agency if the occurrence
According to this view it is immaterial, where a statute has been of the accident, in the manner in which it happened, was the

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very thing which the statute or ordinance was intended to avoided injury had his bicycle been up to par with safety
prevent." (38 Am Jur 841)34 regulations, especially considering that Aonuevo was already
In Teague, the owner of a vocational school stricken by a fire speeding as he made the turn, or before he had seen Villagracia.
resulting in fatalities was found negligent, base on her failure to Even assuming that Aonuevo had failed to see Villagracia because
provide adequate fire exits in contravention of a Manila city the bicycle was not equipped with headlights, such lapse on the
ordinance.35 In F.F. Cruz and Co., Inc. v. Court of Appeals 36, the cyclists part would not have acquitted the driver of his duty to
failure of the petitioner to construct a firewall in accordance with slow down as he proceeded to make the left turn.
city ordinances sufficed to support a finding of negligence. 37 In This court has appreciated that negligence per se, arising from the
Cipriano v. Court of Appeals, 38the Court found that the failure of mere violation of a traffic statute, need not be sufficient in itself in
the petitioner to register and insure his auto rust proofing shop in establishing liability for damages. In Sanitary Steam Laundry, Inc.
accordance with the statute constituted negligence per se, thus v. Court of Appeals,39 a collision between a truck and a privately-
holding him liable for the damages for the destruction by fire of a owned Cimarron van caused the death of three of the vans
customers vehicle garaged therein. passengers. The petitioner therein, the owner of the truck, argued
Should the doctrine of negligence per se apply to Villagracia, that the driver of the Cimarron was committing multiple violations
resulting from his violation of an ordinance? It cannot be denied of the Land Transportation and Traffic Code40 at the time of the
that the statutory purpose for requiring bicycles to be equipped accident. Among these violations: the Cimarron was overloaded at
with headlights or horns is to promote road safety and to minimize the time of the accident; the front seat of the van was occupied by
the occurrence of road accidents involving bicycles. At face value, four adults, including the driver; and the van had only one
Villagracias mishap was precisely the danger sought to be guarded functioning headlight. Similar as in this case, petitioner therein
against by the ordinance he violated. Aonuevo argues that invoked Article 2185 and argued that the driver of the Cimarron
Villagracias violation should bar the latters recovery of damages, should be presumed negligent. The Court, speaking through
and a simplistic interpretation of negligence per se might vindicate Justice Mendoza, dismissed these arguments:
such an argument. [It] has not been shown how the alleged negligence of the Cimarron
But this is by no means a simple case. There is the fact which we driver contributed to the collision between the vehicles. Indeed,
consider as proven, that Aonuevo was speeding as he made the petitioner has the burden of showing a causal connection
left turn, and such negligent act was the proximate cause of the between the injury received and the violation of the Land
accident. This reckless behavior would have imperiled anyone Transportation and Traffic Code. He must show that the
unlucky enough within the path of Aonuevos car as it turned into violation of the statute was the proximate or legal cause of the
the intersection, whether they are fellow motorists, pedestrians, or injury or that it substantially contributed thereto. Negligence
cyclists. We are hard put to conclude that Villagracia would have consisting in whole or in part, of violation of law, like any

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other negligence, is without legal consequence unless it is a undeniably useful as a judicial guide in adjudging liability, for it
contributing cause of the injury. Petitioner says that "driving an seeks to impute culpability arising from the failure of the actor to
overloaded vehicle with only one functioning headlight during perform up to a standard established by a legal fiat. But the
nighttime certainly increases the risk of accident," that because the doctrine should not be rendered inflexible so as to deny relief when
Cimarron had only one headlight, there was "decreased visibility," in fact there is no causal relation between the statutory violation
and that the fact that the vehicle was overloaded and its front seat and the injury sustained. Presumptions in law, while convenient,
overcrowded "decreased its maneuverability." However, mere are not intractable so as to forbid rebuttal rooted in fact. After all,
allegations such as these are not sufficient to discharge its burden tort law is remunerative in spirit, aiming to provide compensation
of proving clearly that such alleged negligence was the contributing for the harm suffered by those whose interests have been invaded
cause of the injury.41 owing to the conduct of others.44
Sanitary Steam42 is controlling in this case. The bare fact that Under American case law, the failures imputed on Villagracia
Villagracia was violating a municipal ordinance at the time of the are not grievous enough so as to negate monetary relief. In the
accident may have sufficiently established some degree of absence of statutory requirement, one is not negligent as a
negligence on his part, but such negligence is without legal matter of law for failing to equip a horn, bell, or other warning
consequence unless it is shown that it was a contributing cause of devise onto a bicycle.45 In most cases, the absence of proper
the injury. If anything at all, it is but indicative of Villagracias lights on a bicycle does not constitute negligence as a matter
failure in fulfilling his obligation to the municipal government, of law46 but is a question for the jury whether the absence of
which would then be the proper party to initiate corrective action proper lights played a causal part in producing a collision with
as a result. But such failure alone is not determinative of a motorist.47 The absence of proper lights on a bicycle at night, as
Villagracias negligence in relation to the accident. Negligence is required by statute or ordinance, may constitute negligence barring
relative or comparative, dependent upon the situation of the parties or diminishing recovery if the bicyclist is struck by a motorist as
and the degree of care and vigilance which the particular long as the absence of such lights was a proximate cause of the
circumstances reasonably require.43 To determine if Villagracia was collision;48 however, the absence of such lights will not preclude or
negligent, it is not sufficient to rely solely on the violations of the diminish recovery if the scene of the accident was well illuminated
municipal ordinance, but imperative to examine Villagracias by street lights,49 if substitute lights were present which clearly
behavior in relation to the contemporaneous circumstances of the rendered the bicyclist visible,50 if the motorist saw the bicycle in
accident. spite of the absence of lights thereon,51 or if the motorist would
The rule on negligence per se must admit qualifications that may have been unable to see the bicycle even if it had been equipped
arise from the logical consequences of the facts leading to the with lights.52 A bicycle equipped with defective or ineffective brakes
mishap. The doctrine (and Article 2185, for that matter) is may support a finding of negligence barring or diminishing

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recovery by an injured bicyclist where such condition was a should, as he made the turn, Aonuevo would have had ample
contributing cause of the accident.53 opportunity to avoid hitting Villagracia. Moreover, the fact that
The above doctrines reveal a common thread. The failure of the Aonuevo had sighted Villagracia before the accident would negate
bicycle owner to comply with accepted safety practices, any possibility that the absence of lights on the bike contributed to
whether or not imposed by ordinance or statute, is not the cause of the accident.56 A motorist has been held liable for
sufficient to negate or mitigate recovery unless a causal injury to or death of a bicyclist where the motorist turned suddenly
connection is established between such failure and the injury into the bicyclist so as to cause a collision. 57
sustained. The principle likewise finds affirmation in Sanitary Neither does Aonuevo attempt before this Court to establish a
Steam, wherein we declared that the violation of a traffic causal connection between the safety violations imputed to
statute must be shown as the proximate cause of the injury, or Villagracia and the accident itself. Instead, he relied on a putative
that it substantially contributed thereto.54 Aonuevo had the presumption that these violations in themselves sufficiently
burden of clearly proving that the alleged negligence of established negligence appreciable against Villagracia. Since the
Villagracia was the proximate or contributory cause of the onus on Aonuevo is to conclusively prove the link between the
latters injury. violations and the accident, we can deem him as having failed to
On this point, the findings of the Court of Appeals are well-worth discharge his necessary burden of proving Villagracias own
citing: liability.
[As] admitted by appellant Aonuevo, he first saw appellee Neither can we can adjudge Villagracia with contributory
Villagracia at a distance of about ten (10) meters before the negligence.1wphi1 The leading case in contributory negligence,
accident. Corrolarily, therefore, he could have avoided the accident Rakes v. Atlantic Gulf 58 clarifies that damages may be mitigated
had he [stopped] alongside with an earlier (sic) jeep which was if the claimant "in conjunction with the occurrence,
already at a full stop giving way to appellee. But according to [contributes] only to his injury."59 To hold a person as having
[eyewitness] Sorsano, he saw appellant Aonuevo "umaarangkada" contributed to his injuries, it must be shown that he
and hit the leg of Villagracia (TSN March 14, 1990 p. 30). This performed an act that brought about his injuries in disregard
earlier (sic) jeep at a full stop gave way to Villagracia to proceed but of warnings or signs of an impending danger to health and
Aonuevo at an unexpected motion (umarangkada) came out body.60 To prove contributory negligence, it is still necessary
hitting Villagracia (TSN March 9, 1990 p. 49). Appellant Aonuevo to establish a causal link, although not proximate, between the
admitted that he did not blow his horn when he crossed Boni negligence of the party and the succeeding injury. In a legal
Avenue (TSN March 21, 1990 p. 47).55 sense, negligence is contributory only when it contributes
By Aonuevos own admission, he had seen Villagracia at a good proximately to the injury, and not simply a condition for its
distance of ten (10) meters. Had he been decelerating, as he occurrence.61

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As between Aonuevo and Villagracia, the lower courts adjudged
Aonuevo as solely responsible for the accident. The petition does
not demonstrate why this finding should be reversed. It is hard to
imagine that the same result would not have occurred even if
Villagracias bicycle had been equipped with safety equipment.
Aonuevo himself admitted having seen Villagracia from ten (10)
meters away, thus he could no longer claim not having been
sufficiently warned either by headlights or safety horns. The fact
that Aonuevo was recklessly speeding as he made the turn
likewise leads us to believe that even if Villagracias bicycle had
been equipped with the proper brakes, the cyclist would not have
had opportunity to brake in time to avoid the speeding car.
Moreover, it was incumbent on Aonuevo to have established that
Villagracias failure to have installed the proper brakes contributed
to his own injury. The fact that Aonuevo failed to adduce proof to
that effect leads us to consider such causal connection as not
proven.
All told, there is no reason to disturb the assailed judgment.
WHEREFORE, the Petition is DENIED. The Decision of the Court of
Appeals is AFFIRMED. Costs against petitioner.
SO ORDERED.

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Republic of the Philippines feet. This posed a great threat to passersby who were exposed to
SUPREME COURT the danger of electrocution especially during the wet season.
Manila As early as 1991, the leaders of Ampucao, Itogon made verbal and
THIRD DIVISION written requests for NPC to institute safety measures to protect
G.R. No. 165969 November 27, 2008 users of the trail from their high tension wires. On June 18, 1991
NATIONAL POWER CORPORATION, petitioner, and February 11, 1993, Pablo and Pedro Ngaosie, elders of the
vs. community, wrote Engr. Paterno Banayot, Area Manager of NPC, to
HEIRS OF NOBLE CASIONAN, respondents. make immediate and appropriate repairs of the high tension wires.
DECISION They reiterated the danger it posed to small-scale miners especially
REYES, R.T., J.: during the wet season. They related an incident where one boy was
PETITIONING power company pleads for mitigation of awarded nearly electrocuted.
damages on ground of contributory negligence. But is the victim in In a letter dated March 1, 1995, Engr. Banayot informed Itogon
this case partly to blame for his electrocution and eventual demise? Mayor Cresencio Pacalso that NPC had installed nine additional
This is a review on certiorari of the Decision1 of the Court of poles on their Beckel-Philex 60 KV line. They likewise identified a
Appeals (CA) which found the National Power Corporation (NPC) possible rerouting scheme with an estimated total cost of 1.7
liable for damages for the death of Noble Casionan due to million pesos to improve the distance from its deteriorating lines to
electrocution from the companys high tension transmission lines. the ground.
The Facts On June 27, 1995, Noble and his co-pocket miner, Melchor
The facts, as found by the trial court are as follows: Jimenez, were at Dalicno. They cut two bamboo poles for their
Respondents are the parents of Noble Casionan, 19 years old at the pocket mining. One was 18 to 19 feet long and the other was 14
time of the incident that claimed his life on June 27, 1995. He feet long. Each man carried one pole horizontally on his shoulder:
would have turned 20 years of age on November 9 of that year. Noble carried the shorter pole while Melchor carried the longer
Noble was originally from Cervantes, Ilocos Sur. He worked as a pole. Noble walked ahead as both passed through the trail
pocket miner in Dalicno, Ampucao, Itogon, Benguet. underneath the NPC high tension transmission lines on their way
A trail leading to Sangilo, Itogon, existed in Dalicno and this trail to their work place.
was regularly used by members of the community. Sometime in the As Noble was going uphill and turning left on a curve, the tip of the
1970s, petitioner NPC installed high-tension electrical bamboo pole he was carrying touched one of the dangling high
transmission lines of 69 kilovolts (KV) traversing the trail. tension wires. Melchor, who was walking behind him, narrated that
Eventually, some of the transmission lines sagged and dangled he heard a buzzing sound when the tip of Nobles pole touched the
reducing their distance from the ground to only about eight to ten wire for only about one or two seconds. Thereafter, he saw Noble

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fall to the ground. Melchor rushed to Noble and shook him but the At the trial, NPC witnesses testified that the cause of death could
latter was already dead. Their co-workers heard Melchors shout not have been electrocution because the victim did not suffer
for help and together they brought the body of Noble to their camp. extensive burns despite the strong 69 KV carried by the
A post-mortem examination by Dra. Ignacia Reyes Ciriaco, transmission lines. NPC argued that if Noble did die by
Municipal Health Officer of Itogon, Benguet, determined the cause electrocution, it was due to his own negligence. The company
of death to be cardiac arrest, secondary to ventricular fibulation, counter-claimed for attorneys fees and cost of litigation.
secondary to electrocution.2 She also observed a small burned area RTC Disposition
in the middle right finger of the victim. On February 17, 1998, the RTC decided in favor of respondents.
Police investigators who visited the site of the incident confirmed The fallo of its decision reads:
that portions of the high tension wires above the trail hung very WHEREFORE, judgment is hereby rendered in favor of the
low, just about eight to ten feet above the ground. They noted that plaintiffs and against the defendant NPC as follows:
the residents, school children, and pocket miners usually used the 1. Declaring defendant NPC guilty of Negligence
trail and had to pass directly underneath the wires. The trail was (Quasi-Delict) in connection with the death of Noble
the only viable way since the other side was a precipice. In Casionan;
addition, they did not see any danger warning signs installed in the 2. Ordering NPC as a consequence of its negligence,
trail. to pay the plaintiffs Jose and Linda Casionan, as
The elders and leaders of the community, through Mayor Cresencio heirs of the deceased, Noble Casionan, the following
Pacalso, informed the General Manager of NPC in Itogon of the Damages:
incident. After learning of the electrocution, NPC repaired the a. P50,000.00 as indemnity for the death of
dangling and sagging transmission lines and put up warning signs their son Noble Casionan;
around the area. b. P100,000.00 as moral damages;
Consequently, the heirs of the deceased Noble filed a claim for c. P50,000.00 as exemplary damages;
damages against the NPC before the Regional Trial Court (RTC) in d. P52,277.50 as actual damages incurred
Benguet. In its answer, NPC denied being negligent in maintaining for the expenses of burial and wake in
the safety of the high tension transmission lines. It averred that connection with the death of Noble Casionan;
there were danger and warning signs installed but these were e. P720,000.00 as the loss of unearned
stolen by children. Excavations were also made to increase the income; and
necessary clearance from the ground to about 17 to 18 feet but f. P20,000.00 as attorneys fees and the cost
some towers or poles sank due to pocket mining in the area. of suit; and

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3. Dismissing the counter claim of the NPC for lack NPC has already been called by several requests and
of merit.3 demands in 1991, 1993 and 1995 by elders and leaders of
The RTC gave more credence to the testimony of witnesses for the community in the area to the fact that their transmission
respondents than those of NPC who were not actually present at lines were dangling and sagging and the clearance thereof
the time of the incident. The trial court observed that witnesses for from the line to the ground was only 8 to 10 feet and not
NPC were biased witnesses because they were all employed by the within the standard clearance of 18 to 20 feet but no safety
company, except for the witness from the Department of measures were taken. They did not even put danger and
Environment and Natural Resources (DENR). The RTC found: warning signs so as to warn persons passing underneath. 5
Melchor Jimenez was very vivid in his account. He declared (Emphasis added)
that he and Noble Casionan cut two bamboo poles, one 14 Disagreeing with the ruling of the trial court, NPC elevated the case
feet and the other about 18 feet. The shorter bamboo pole to the CA. In its appeal, it argued that the RTC erred in ruling that
was carried by Noble Casionan and the longer bamboo pole NPC was liable for Nobles death. Further, even assuming that
was carried by him. And they walked along the trail Noble died of electrocution, the RTC erred in not finding that he
underneath the transmission lines. He was following Noble was guilty of contributory negligence and in awarding excessive
Casionan. And when they were going uphill in the trail and damages.
Noble Casionan was to turn left in a curve, the bamboo pole CA Disposition
of Casionan swung around and its tip at the back touched On June 30, 2004, the CA promulgated its decision, disposing as
for one or two seconds or for a split moment the follows:
transmission line that was dangling and a buzzing sound WHEREFORE, the appealed Decision is hereby AFFIRMED,
was heard. And Casionan immediately fell dead and simply with the MODIFICATION that the amount of moral damages
stopped breathing. What better account would there be than is REDUCED to Fifty Thousand Pesos (P50,000.00); and the
this? Melchor Jimenez was an eye witness as to how it all award of attorneys fees in the sum of Twenty Thousand
happened.4 (Emphasis added) Pesos (P20,000.00) is DELETED.6
The RTC ruled that the negligence of NPC in maintaining the high- The CA sustained the findings of fact of the trial court but reduced
tension wires was established by preponderance of evidence. On the award of moral damages from P100,000.00 to P50,000.00. The
this score, the RTC opined: CA further disallowed the award of attorneys fees because the
2. On the matter of whether plaintiffs have a cause of action reason for the award was not expressly stated in the body of the
against defendant NPC, obviously, they would have. x x x decision.
This negligence of the NPC was well established and cannot Issues
be denied because previous to this incident, the attention of

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The following issues are presented for Our consideration: (i) is especially true because other people traversing the trail have not
Whether the award for damages should be deleted in view of the been similarly electrocuted.
contributory negligence of the victim; and (ii) Whether the award Petitioners contentions are absurd.
for unearned income, exemplary, and moral damages should be The sagging high tension wires were an accident waiting to happen.
deleted for lack of factual and legal bases.7 As established during trial, the lines were sagging around 8 to 10
Our Ruling feet in violation of the required distance of 18 to 20 feet. If the
I transmission lines were properly maintained by petitioner, the
That the victim Noble died from being electrocuted by the high- bamboo pole carried by Noble would not have touched the wires.
tension transmission wires of petitioner is not contested by He would not have been electrocuted.
petitioner. We are, however, asked to delete or mitigate the Petitioner cannot excuse itself from its failure to properly maintain
damages awarded by the trial and appellate courts in view of what the wires by attributing negligence to the victim. In Ma-ao Sugar
petitioner alleges to be contributory negligence on the part of the Central Co., Inc. v. Court of Appeals,9 this Court held that the
victim. responsibility of maintaining the rails for the purpose of preventing
As a rule, only questions of law may be entertained on appeal by derailment accidents belonged to the company. The company
certiorari under Rule 45. The finding of negligence on the part of should not have been negligent in ascertaining that the rails were
petitioner by the trial court and affirmed by the CA is a question of fully connected than to wait until a life was lost due to an accident.
fact which We cannot pass upon since it would entail going into Said the Court:
factual matters on which the finding of negligence was based. 8 In this petition, the respondent court is faulted for finding
Corollary to this, the finding by both courts of the lack of the petitioner guilty of negligence notwithstanding its
contributory negligence on the part of the victim is a factual issue defense of due diligence under Article 2176 of the Civil Code
which is deemed conclusive upon this Court absent any compelling and for disallowing the deductions made by the trial court.
reason for Us to rule otherwise. Investigation of the accident revealed that the derailment of
But even if We walk the extra mile, the finding of liability on the locomotive was caused by protruding rails which had
the part of petitioner must stay. come loose because they were not connected and fixed in
Petitioner contends that the mere presence of the high tension place by fish plates. Fish plates are described as strips of
wires above the trail did not cause the victims death. Instead, it iron 8" to 12" long and 3 " thick which are attached to the
was Nobles negligent carrying of the bamboo pole that caused his rails by 4 bolts, two on each side, to keep the rails aligned.
death. It insists that Noble was negligent when he allowed the Although they could be removed only with special
bamboo pole he was carrying to touch the high tension wires. This equipment, the fish plates that should have kept the rails
aligned could not be found at the scene of the accident.

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There is no question that the maintenance of the rails, for the damages. This is in consonance with the Civil Code provision that
purpose, inter alia, of preventing derailments, was the liability will be mitigated in consideration of the contributory
responsibility of the petitioner, and that this responsibility negligence of the injured party. Article 2179 of the Civil Code is
was not discharged. According to Jose Reyes, its own explicit on this score:
witness, who was in charge of the control and supervision When the plaintiffs own negligence was the immediate
of its train operations, cases of derailment in the milling and proximate cause of his injury, he cannot recover
district were frequent and there were even times when such damages. But if his negligence was only contributory,
derailments were reported every hour. The petitioner should the immediate and proximate cause of the injury being
therefore have taken more prudent steps to prevent such the defendants lack of due care, the plaintiff may
accidents instead of waiting until a life was finally lost recover damages, but the courts shall mitigate the
because of its negligence.10 damages to be awarded.
Moreover, We find no contributory negligence on Nobles part. In Ma-ao Sugar Central, it was held that to hold a person as having
Negligence is the failure to observe, for the protection of the contributed to his injuries, it must be shown that he performed an
interest of another person, that degree of care, precaution, and act that brought about his injuries in disregard of warnings or
vigilance which the circumstances justly demand, whereby signs on an impending danger to health and body. This Court held
such other person suffers injury.11 On the other hand, then that the victim was not guilty of contributory negligence as
contributory negligence is conduct on the part of the injured there was no showing that the caboose where he was riding was a
party, contributing as a legal cause to the harm he has dangerous place and that he recklessly dared to stay there despite
suffered, which falls below the standard which he is required warnings or signs of impending danger.16
to conform for his own protection.12 There is contributory In this case, the trail where Noble was electrocuted was regularly
negligence when the partys act showed lack of ordinary care and used by members of the community. There were no warning signs
foresight that such act could cause him harm or put his life in to inform passersby of the impending danger to their lives should
danger.13 It is an act or omission amounting to want of ordinary they accidentally touch the high tension wires. Also, the trail was
care on the part of the person injured which, concurring with the the only viable way from Dalicon to Itogon. Hence, Noble should
defendants negligence, is the proximate cause of the injury. 14 not be faulted for simply doing what was ordinary routine to other
The underlying precept on contributory negligence is that a workers in the area.
plaintiff who is partly responsible for his own injury should not be Petitioner further faults the victim in engaging in pocket mining,
entitled to recover damages in full but must bear the consequences which is prohibited by the DENR in the area.
of his own negligence.15 If indeed there was contributory negligence In Aonuevo v. Court of Appeals,17 this Court ruled that the
on the part of the victim, then it is proper to reduce the award for violation of a statute is not sufficient to hold that the violation was

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the proximate cause of the injury, unless the very injury that constitute negligence as a matter of law but is a question
happened was precisely what was intended to be prevented by the for the jury whether the absence of proper lights played a
statute. In said case, the allegation of contributory negligence on causal part in producing a collision with a motorist. The
the part of the injured party who violated traffic regulations when absence of proper lights on a bicycle at night, as required by
he failed to register his bicycle or install safety gadgets thereon was statute or ordinance, may constitute negligence barring or
struck down. We quote: diminishing recovery if the bicyclist is struck by a motorist as
x x x The bare fact that Villagracia was violating a municipal long as the absence of such lights was a proximate cause of
ordinance at the time of the accident may have sufficiently the collision; however, the absence of such lights will not
established some degree of negligence on his part, but such preclude or diminish recovery if the scene of the accident was
negligence is without legal consequence unless it is shown well illuminated by street lights, if substitute lights were
that it was a contributing cause of the injury. If anything at present which clearly rendered the bicyclist visible, if the
all, it is but indicative of Villagracias failure in fulfilling his motorist saw the bicycle in spite of the absence of lights
obligation to the municipal government, which would then thereon, or if the motorist would have been unable to see the
be the proper party to initiate corrective action as a result. bicycle even if it had been equipped with lights. A bicycle
But such failure alone is not determinative of Villagracias equipped with defective or ineffective brakes may support a
negligence in relation to the accident. Negligence is relative finding of negligence barring or diminishing recovery by an
or comparative, dependent upon the situation of the parties injured bicyclist where such condition was a contributing
and the degree of care and vigilance which the particular cause of the accident.
circumstances reasonably require. To determine if The above doctrines reveal a common thread. The failure of
Villagracia was negligent, it is not sufficient to rely solely on the bicycle owner to comply with accepted safety practices,
the violations of the municipal ordinance, but imperative to whether or not imposed by ordinance or statute, is not
examine Villagracias behavior in relation to the sufficient to negate or mitigate recovery unless a causal
contemporaneous circumstances of the accident. connection is established between such failure and the injury
xxxx sustained. The principle likewise finds affirmation in
Under American case law, the failures imputed on Sanitary Steam, wherein we declared that the violation of a
Villagracia are not grievous enough so as to negate traffic statute must be shown as the proximate cause of the
monetary relief. In the absence of statutory requirement, injury, or that it substantially contributed thereto.
one is not negligent as a matter of law for failing to equip a Aonuevo had the burden of clearly proving that the alleged
horn, bell, or other warning devise onto a bicycle. In most negligence of Villagracia was the proximate or contributory
cases, the absence of proper lights on a bicycle does not cause of the latters injury.18 (Emphasis added)

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That the pocket miners were unlicensed was not a justification for (2/3 x [80 - age at death]) adopted in the American Expectancy
petitioner to leave their transmission lines dangling. We quote with Table of Mortality or the Actuarial Combined Experience Table of
approval the observation of the RTC on this matter: Mortality. The second factor is computed by multiplying the life
The claim of NPC that the pocket miners have no right to expectancy by the net earnings of the deceased, i.e., the total
operate within the area of Dalicno, Itogon, Benguet as there earnings less expenses necessary in the creation of such earnings
was no permit issued by DENR is beside the point. The fact or income and less living and other incidental expenses. The net
is that there were not only pocket miners but also there earning is ordinarily computed at fifty percent (50%) of the gross
were many residents in the area of Dalicno, Ampucao, earnings. Thus, the formula used by this Court in computing loss
Itogon, Benguet using the trail. These residents were using of earning capacity is: Net Earning Capacity = [2/3 x (80 age at
this trail underneath the transmission lines x x x. They time of death) x (gross annual income reasonable and necessary
were using this trail even before the transmission lines were living expenses)].20
installed in the 1970s by NPC. The pocket miners, although We sustain the trial court computation of unearned income of the
they have no permit to do pocket mining in the area, are also victim:
human beings who have to eke out a living in the only way x x x the loss of his unearned income can be computed as
they know how. The fact that they were not issued a permit follows: two-thirds of 80 years, minus 20 years, times
by the DENR to do pocket mining is no justification for NPC to P36,000.00 per year, equals P1,440,000.00. This is because
simply leave their transmission lines dangling or hanging 8 Noble Casionan, at the time of his death, was 20 years old
to 10 feet above the ground posing danger to the life and limb and was healthy and strong. And, therefore, his life
of everyone in said community. x x x19 (Emphasis added) expectancy would normally reach up to 80 years old in
In sum, the victim was not guilty of contributory negligence. accordance with the above formula illustrated in the
Hence, petitioner is not entitled to a mitigation of its liability. aforesaid cases. Thus, Noble Casionan had 60 more years
II life expectancy since he was 20 years old at the time of his
We now determine the propriety of the awards for loss of death on June 27, 1995. Two-thirds of 60 years times
unearned income, moral, and exemplary damages. P36,000.00 since he was earning about P3,000.00 a month
From the testimony of the victims mother, it was duly established of P36,000.00 a year would be P1,440,000.00.
during trial that he was earning P3,000.00 a month. To determine However, in determining the unearned income, the basic
the compensable amount of lost earnings, We consider (1) the concern is to determine the damages sustained by the heirs
number of years for which the victim would otherwise have lived or dependents of the deceased Casionan. And here, the
(life expectancy); and (2) the rate of loss sustained by the heirs of damages consist not of the full amount of his earnings but
the deceased. Life expectancy is computed by applying the formula the support they would have received from the deceased

Page 36 of 205
had he not died as a consequence of the unlawful act of the the wrongdoer. It is not meant to enrich the complainant but to
NPC. x x x The amount recoverable is not the loss of the enable the injured party to obtain means to obviate the moral
entire earnings but the loss of that portion of the earnings suffering experience. Trial courts should guard against the award
which the heirs would have received as support. Hence, of exorbitant damages lest they be accused of prejudice or
from the amount of P1,440,000.00, a reasonable amount corruption in their decision making.24 We find that the CA correctly
for the necessary expenses of Noble Casionan had he lived reduced the award from P100,000.00 to P50,000.00.
would be deducted. Following the ruling in People v. As for the award for attorneys fees, well-settled is the rule that the
Quilaton, 205 SCRA 279, the Court deems that 50 percent reason for the award must be discussed in the text of the courts
of the gross earnings of the deceased of P1,440,000.00 decision and not only in the dispositive portion. 25 Except for the
should be deducted for his necessary expenses had he fallo, a discussion on the reason for the award for attorneys fees
lived, thus leaving the other half of about P720,000.00 as was not included by the RTC in its decision. The CA thus correctly
the net earnings that would have gone for the support of his disallowed it on appeal.
heirs. This is the unearned income of which the heirs were WHREFORE, the petition is DENIED and the appealed decision of
deprived of.21 the Court of Appeals AFFIRMED.
In quasi delicts, exemplary damages are awarded where the SO ORDERED.
offender was guilty of gross negligence.22 Gross negligence has
been defined to be the want or absence of even slight care or
diligence as to amount to a reckless disregard of the safety of
person or property. It evinces a thoughtless disregard of
consequences without exerting any effort to avoid them.23
Petitioner demonstrated its disregard for the safety of the members
of the community of Dalicno who used the trail regularly when it
failed to address the sagging high tension wires despite numerous
previous requests and warnings. It only exerted efforts to rectify
the danger it posed after a death from electrocution already
occurred. Gross negligence was thus apparent, warranting the
award of exemplary damages.
As to the award of moral damages, We sustain the CA reduction of
the award. Moral damages are designed to compensate the
claimant for actual injury suffered and not to impose a penalty on

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Republic of the Philippines Respondents, the heirs of Ray Castillon, thus filed an action for
SUPREME COURT damages with prayer for preliminary attachment against the
Manila petitioner Nelen Lambert. The complaint was docketed as Civil
FIRST DIVISION Case No. 06-2086 of the RTC of Iligan City, Branch 06.4 The
G.R. No. 160709 February 23, 2005 complaint was subsequently amended to include the claim by Joel
NELEN LAMBERT, assisted by her husband, GLENROY Castillon for the damages caused to the motorcycle. 51vvphi1.nt
ALOYSUIS LAMBERT, petitioners, On June 29, 1993, after a full-blown trial, the court a quo rendered
vs. a decision in favor of herein private respondents but reduced
HEIRS OF RAY CASTILLON, Represented by MARILOU T. petitioners liability by 20% in view of the contributory negligence
CASTILLON and SERGIO LABANG, respondents. of Ray. The dispositi ve portion of the decision reads:
DECISION WHEREFORE, judgment is hereby rendered in favor of the
YNARES-SANTIAGO, J.: plaintiffs and against the defendants, directing the latter, jointly
This is a petition for review under Rule 45 of the Rules of Court and severally, to pay the former the following:
seeking the reversal of the decision1 of the Court of Appeals dated 1. The sum of SIX HUNDRED THIRTY-THREE THOUSAND
October 21, 2002 in CA-G.R. CV No. 43734, which affirmed the AND NINETY-ONE (P633,091) PESOS, representing loss of
June 29, 1993 decision of the Regional Trial Court of Iligan City, support, death indemnity, funeral and related expenses,
Branch 06, in Civil Case No. 06-2086. moral damages and attorneys fees and
In the evening of January 13, 1991, Ray Castillon visited the house 2. Costs of the suit.
of his brother Joel Castillon at Tambo, Iligan City and borrowed his For lack of merit, defendants counterclaim is dismissed.
motorcycle. He then invited his friend, Sergio Labang, to roam On the claim of Joel Castillon, the evidence shows that he is not
around Iligan City. Ray drove the motorcycle with Sergio as the the real owner of the motorcycle. He is not the real party in
backrider.2 interest. Accordingly, his complaint is dismissed.
At around past 10:00 p.m., after eating supper at Honas On the third-party complaint, the third-party defendant Zenith
Restaurant and imbibing a bottle of beer, they traversed the Insurance Corporation is ordered to pay the sum of P16,500.00
highway towards Tambo at a high speed. Upon reaching Brgy. Sto. directly to the plaintiffs. This sum, if paid, should be deducted
Rosario, they figured in an accident with a Tamaraw jeepney, from the amount adjudged in par. 1 above.
owned by petitioner Nelen Lambert and driven by Reynaldo Gamot, SO ORDERED.6
which was traveling on the same direction but made a sudden left The Court of Appeals affirmed the decision of the trial court. 7
turn. The incident resulted in the instantaneous death of Ray and Hence the present petition, based on the following arguments:
injuries to Sergio.3

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1. The Honorable Court of Appeals committed serious error computation is contrary to the formula enunciated by this
of law and grave abuse of discretion when it did not apply Honorable Court in the case of Villa Rey Transit, Inc. vs.
the ruling of this Honorable Court in the case of Philippine The Honorable Court of Appeals [31 SCRA 511 (1970)].
Rabbit Bus Lines vs. The Honorable Intermediate Appellate 5. The Honorable Trial Courts award of moral damages is
Court and Casiano Pascua, Et. Al., [189 SCRA 168, August contrary to the pronunciation of this Honorable Court in
30, 1990], as reiterated recently in the case of Edna A. the case of Ace Haulers Corporation vs. The Honorable
Raynera vs. Freddie Hiceta and Jimmy Orpilla [306 SCRA Court of Appeals and Abiva [338 SCRA 572, August 23,
102, April 21, 1999], in which this Honorable Court 2000], wherein the award of moral damages was disallowed
enunciated that drivers of vehicles "who bump the rear of absent any evidence of bad faith or ill-motive.8
another vehicle" are presumed to be the cause of the Petitioner insists that the negligence of Ray Castillon was the
accident. proximate cause of his unfortunate death and therefore she is not
2. The erroneous conclusion of the Honorable Trial Court as liable for damages.
affirmed by the Honorable Court of Appeals that the act of In petitions for review on certiorari under Rule 45 of the Rules of
tailgating, at high speed, constitutes contributory Court, only questions of law may be put into issue. Questions of
negligence only, is contrary to the rulings of this Honorable fact cannot be entertained. The finding of negligence by the Court
Court in the case of Sanitary Steam Laundry, INC. vs. The of Appeals is a question of fact which we cannot pass upon as it
Honorable Court of Appeals [300 SCRA 20, December 10, would entail going into factual matters on which the finding of
1998] and the case of Edna A. Raynera vs. Freddie Hiceta negligence was based. As a rule, factual findings of the trial court,
and Jimmy Orpilla [306 SCRA 102, April 21, 1999]. especially those affirmed by the Court of Appeals, are conclusive on
3. The Honorable Court of Appeals grossly erred in its this Court when supported by the evidence on record. 9
conclusion that petitioners driver was negligent, without Our examination of the records shows that both the trial court and
taking into consideration the presumptions enunciated by the Court of Appeals carefully considered the factual backdrop of
this Honorable Court in the case of Philippine Rabbit Bus the case. No cogent reason exists for disturbing the following
Lines vs. The Honorable Intermediate Appellate Court and findings of the trial court, which the Court of Appeals affirmed:
Casiano Pascua, Et. Al., [189 SCRA 168, August 30, 1990], To the mind of the court, this is exactly what happened. When
and the case of Edna A. Raynera vs. Freddie Hiceta and Reynaldo Gamot was approaching the side road, he slightly veered
Jimmy Orpilla [306 SCRA 102, April 21, 1999]. to the right for his allowance. Ray Castillon, who was following
4. As an alternative relief, petitioner most respectfully closely behind, instinctively veered to the left but it was also the
assigns as error the Honorable Trial Courts computation as moment when Reynaldo Gamot sharply turned to the left towards
to the loss of earning capacity of Ray Castillon. Such the side road. At this juncture both were moving obliquely to the

Page 39 of 205
left.l^vvphi1.net Thus the motorcycle sliced into the side of the In Raynera, the death of the victim was solely attributable to his
jeepney throwing the driver forward so that his forehead hit the own negligence in bumping the rear of the trailer truck which was
angle bar on the left front door of the jeepney even as the traveling ahead of him at 20 to 30 kilometers per hour. Raynera,
motorcycle shot forward and the jeepney veered back to the right being the driver of the rear vehicle, had full control of the situation
and sped away. as he was in a position to observe the vehicle in front of him. The
trailer truck therein did not make a sudden left turn as in the case
The testimonies of the witnesses Frias, Opada, Labang and Sumile at bar. Thus, the theory that drivers of vehicles "who bump the
show that he did not stop even for a second, or less before making rear of another vehicle" are presumed to be the cause of the
the left turn. On the contrary, he slightly veered to the right accident is, as in this case, sufficiently contradicted by evidence,
immediately followed by the abrupt and sudden turn to the left in which is the sudden left turn made by Reynaldo which proximately
order to enter the side road. It is apparent that Reynaldo Gamot caused the collision.
did not keep a lookout for vehicles or persons following him before While we agree with the trial court that Ray was likewise guilty of
proceeding to turn left. He failed to take into account the possibility contributory negligence as defined under Article 2179 of the Civil
that others may be following him. He did not employ the necessary Code, we find it equitable to increase the ratio of apportionment of
precaution to see to it that the road was clear. 10 damages on account of the victims negligence.
Clearly, the abrupt and sudden left turn by Reynaldo, without first Article 2179 reads as follows:
establishing his right of way, was the proximate cause of the When the plaintiffs negligence was the immediate and proximate
mishap which claimed the life of Ray and injured Sergio. cause of his injury, he cannot recover damages. But if his negligence
Proximate cause is defined as that which, in the natural and was only contributory, the immediate and proximate cause of the
continuous sequence, unbroken by any efficient, intervening injury being the defendants lack of due care, the plaintiff may
cause, produces the injury, and without which the result would recover damages, but the courts shall mitigate the damages to be
not have occurred.11 The cause of the collision is traceable to the awarded.
negligent act of Reynaldo for, as the trial court correctly held, The underlying precept on contributory negligence is that a
without that left turn executed with no precaution, the mishap in all plaintiff who is partly responsible for his own injury should not
probability would not have happened.12 be entitled to recover damages in full but must bear the
Petitioner misunderstood our ruling in Raynera v. Hiceta.13 That consequences of his own negligence. The defendant must thus
case also involved a motorcycle crashing into the left rear portion of be held liable only for the damages actually caused by his
another vehicle, and we declared therein that drivers of vehicles negligence.15 The determination of the mitigation of the defendants
"who bump the rear of another vehicle" are presumed to be "the liability varies depending on the circumstances of each case. The
cause of the accident, unless contradicted by other evidence".14 Court had sustained a mitigation of 50% in Rakes v. AG & P;1620%

Page 40 of 205
in Phoenix Construction, Inc. v. Intermediate Appellate Court17 and creation of such earnings or income and less living and other
LBC Air Cargo, Inc. v. Court of Appeals;18 and 40% in Bank of the incidental expenses. The net earning is ordinarily computed at
Philippine Islands v. Court of Appeals19 and Philippine Bank of fifty percent (50%) of the gross earnings. Thus, the formula
Commerce v. Court of Appeals.201awphi1.nt used by this Court in computing loss of earning capacity is: Net
In the case at bar, it was established that Ray, at the time of the Earning Capacity = [2/3 x (80 age at time of death) x (gross
mishap: (1) was driving the motorcycle at a high speed; (2) was annual income reasonable and necessary living expenses)].22
tailgating the Tamaraw jeepney; (3) has imbibed one or two bottles It was established that Ray was 35 at the time of his death and
of beer; and (4) was not wearing a protective helmet. 21 These was earning a gross annual income of P31,876.00 as a driver at the
circumstances, although not constituting the proximate cause of Mindanao State University. In arriving at the net earnings, the trial
his demise and injury to Sergio, contributed to the same result. court deducted from the gross annual income the annual living
The contribution of these circumstances are all considered and expenses in the amount of P9,672.00, broken down as follows:
determined in terms of percentages of the total cause. Hence, P20.00 a day for travel or P520.00 per month; P60.00 a month for
pursuant to Rakes v. AG & P, the heirs of Ray Castillon shall cigarettes; P26.00 for drinks; and other personal expenses like
recover damages only up to 50% of the award. In other words, 50% clothing, toiletries, etc. estimated at P200.00 per month. 23 The
of the damage shall be borne by the private respondents; the amount of P9,672.00, however, appears unrealistic, and
remaining 50% shall be paid by the petitioner. constitutes only 30.34% of the gross earnings. It even includes
Anent the award of loss of earning capacity, we agree with the expenses for cigarettes which by no means can be classified as a
petitioner that the trial court erred in the computation of the net necessary expense. Using the cited formula with the net earnings
earnings. computed at 50% of the gross earnings, a detailed computation is
In considering the earning capacity of the victim as an element of as follows:
damages, the following factors are considered in determining the 1vvphi1.nt
compensable amount of lost earnings: (1) the number of years for = LIFE
which the victim would otherwise have lived; and (2) the rate of NET x GROSS
EXPECTANCY - LIVING
loss sustained by the heirs of the deceased. Jurisprudence EARNING ANNUAL
[2/3 (80-age at EXPENSES
provides that the first factor, i.e., life expectancy, is computed by CAPACITY INCOME
the time of (50% of GAI)
applying the formula (2/3 x [80 - age at death]) adopted in the (X) (GAI)
death)]
American Expectancy Table of Mortality or the Actuarial Combined
Experience Table of Mortality. As to the second factor, it is x -50% x
X = [2/3 (80-35)]
computed by multiplying the life expectancy by the net earnings of [P31,876.00 P31,876.00]
the deceased, i.e., the total earnings less expenses necessary in the
X = [2/3 (45)] x - P15,938.00]

Page 41 of 205
[P31,876.00 damages for mental anguish by reason of the death of the
deceased.
X = 30 x 15,938.00 However, the amount has been gradually increased through the
years. At present, prevailing jurisprudence fixes the amount at
X = P478,140.00
P50,000.00.26
We sustain the awards of P33,215.00 as funeral and burial Paragraph 3 of the same provision also serves as the basis for the
expenses being supported with receipts;24 P50,000.00 as death award of moral damages in quasi-delict. The reason for the grant of
indemnity; and P50,000.00 as moral damages. However, the award moral damages has been explained, thus:
of P20,000.00 as attorneys fees must be deleted for lack of basis. the award of moral damages is aimed at a restoration,
The indemnity for death caused by a quasi-delict used to be pegged within the limits possible, of the spiritual status quo ante; and
at P3,000.00,25 based on Article 2206 of the Civil Code, which therefore, it must be proportionate to the suffering inflicted.
reads: The intensity of the pain experienced by the relatives of the victim
ART. 2206. The amount of damages for death caused by a crime or is proportionate to the intensity of affection for him and bears no
quasi-delict shall be at least three thousand pesos, even though relation whatsoever with the wealth or means of the offender. 27
there may have been mitigating circumstances. In addition: While it is true that there can be no exact or uniform rule for
(1) The defendant shall be liable for the loss of the measuring the value of human life and the measure of damages
earning capacity of the deceased, and the indemnity cannot be arrived at by a precise mathematical calculation, 28 we
shall be paid to the heirs of the latter; such indemnity hold that the trial courts award of moral damages of P50,000.00
shall in every case be assessed and awarded by the court, for the death of Ray Castillon is in accord with the prevailing
unless the deceased on account of permanent physical jurisprudence.29
disability not caused by the defendant, had no earning With respect to attorneys fees, it is well settled that the same
capacity at the time of his death; should not be awarded in the absence of stipulation except under
(2) If the deceased was obliged to give support according the instances enumerated in Article 2208 of the Civil Code. The
to the provisions of article 291, the recipient who is trial court did not indicate the basis for its award. As we have held
not an heir called to the decedents inheritance by the in Rizal Surety and Insurance Company v. Court of Appeals:30
law of testate or intestate succession, may demand "Article 2208 of the Civil Code allows attorneys fess to be awarded
support from the person causing the death, for a by a court when its claimant is compelled to litigate with third
period of not exceeding five years, the exact duration to persons or to incur expenses to protect his interest by reason of an
be fixed by the court; unjustified act or omission of the party from whom it is
(3) The spouse, legitimate and illegitimate descendants sought.l^vvphi1.net While judicial discretion is here extant, an
and ascendants of the deceased may demand moral

Page 42 of 205
award thereof demands, nevertheless, a factual, legal or equitable
justification.1a\^/phi1.net The matter cannot and should not be
left to speculation and conjecture (Mirasol vs. De la Cruz, 84 SCRA
337; Stronghold Insurance Company, Inc. vs. Court of Appeals, 173
SCRA 619).
In the case at bench, the records do not show enough basis for
sustaining the award for attorneys fees and to adjudge its payment
by petitioner"
Likewise, this Court held in Stronghold Insurance Company, Inc. vs.
Court of Appeals that:
"In Abrogar v. Intermediate Appellate Court [G.R. No. 67970,
January 15, 1988, 157 SCRA 57] the Court had occasion to state
that [t]he reason for the award of attorneys fees must be
stated in the text of the courts decision, otherwise, if it is
stated only in the dispositive portion of the decision, the same
must be disallowed on appeal. 1awphi1.nt
WHEREFORE, in view of the foregoing, the petition is DENIED.
The assailed decision of the Court of Appeals is AFFIRMED with
the MODIFICATION that the net earnings is computed at 50% of
the gross annual income to conform with the prevailing
jurisprudence, and the FURTHER MODIFICATION that petitioner
NELEN LAMBERT is ordered to pay the heirs of Ray Castillon only
50% of the damages herein awarded, except attorneys fees which
is DELETED for lack of basis.
SO ORDERED.

Page 43 of 205
Republic of the Philippines Tarlac. Mercelita, driving at approximately 70 km/hr, drove past a
SUPREME COURT vehicle, unaware of the railroad track up ahead and that they were
Manila about to collide with PNR Train No. T-71. Mercelita was instantly
FIRST DIVISION killed when the Mercedes Benz smashed into the train; the two
G.R. No. 169891 November 2, 2006 other passengers suffered serious physical injuries.5 A certain
PHILIPPINE NATIONAL RAILWAYS, Petitioner, James Harrow6 brought Rhonda Brunty to the Central Luzon
vs. Doctors Hospital in Tarlac, where she was pronounced dead after
ETHEL BRUNTY and JUAN MANUEL M. GARCIA, Respondents. ten minutes from arrival. Garcia, who had suffered severe head
DECISION injuries, was brought via ambulance to the same hospital. He was
CALLEJO, SR., J.: transferred to the Manila Doctors Hospital, and later to the Makati
This is a Petition for Review on Certiorari of the Decision 1 of the Medical Center for further treatment.7
Court of Appeals (CA) in CA-G.R. CV No. 47567 and its Resolution2 On July 28, 1981, Ethel Brunty sent a demand letter8 to the PNR
denying the motion for reconsideration thereof. The assailed demanding payment of actual, compensatory, and moral damages,
decision affirmed with partial modification the ruling3 of the as a result of her daughters death. When PNR did not respond,
Regional Trial Court (RTC) of Manila, Branch 20, directing Ethel Brunty and Garcia, filed a complaint9 for damages against
petitioner Philippine National Railways (PNR) to indemnify the PNR before the RTC of Manila. The case was raffled to Branch
respondents Ethel Brunty and Juan Manuel M. Garcia for the 20 and was docketed as Civil Case No. 83-18645. They alleged that
death of Rhonda Brunty, and to pay actual and moral damages, the death of Mercelita and Rhonda Brunty, as well as the physical
attorneys fees and cost of suit. injuries suffered by Garcia, were the direct and proximate result of
Rhonda Brunty, daughter of respondent Ethel Brunty and an the gross and reckless negligence of PNR in not providing the
American citizen, came to the Philippines for a visit sometime in necessary equipment at the railroad crossing in Barangay Rizal,
January 1980. Prior to her departure, she, together with her Municipality of Moncada, Tarlac. They pointed out that there was
Filipino host Juan Manuel M. Garcia, traveled to Baguio City on no flagbar or red light signal to warn motorists who were about to
board a Mercedes Benz sedan with plate number FU 799, driven by cross the railroad track, and that the flagman or switchman was
Rodolfo L. Mercelita. It was about 12:00 midnight, January 25, only equipped with a hand flashlight.10 Plaintiffs likewise averred
1980. By then, PNR Train No. T-71, driven by Alfonso Reyes, was that PNR failed to supervise its employees in the performance of
on its way to Tutuban, Metro Manila4 as it had left the La Union their respective tasks and duties, more particularly the pilot and
station at 11:00 p.m., January 24, 1980. operator of the train.11 They prayed for the payment of the following
By 2:00 a.m., Rhonda Brunty, Garcia and Mercelita were already damages:
approaching the railroad crossing at Barangay Rizal, Moncada,

Page 44 of 205
1.) P200,000.00 as actual and compensatory damages to accident. The driver disregarded the warning signs, the whistle
plaintiff Ethel Brunty; blasts of the oncoming train and the flashlight signals to stop given
2.) P2,800,000.00 for compensatory damages to plaintiff by the guard.15 As counterclaim, it prayed that it be awarded
Ethel Brunty representing lost or unearned income of actual and compensatory damages, and litigation expenses. 16
Rhonda Brunty; Plaintiffs filed an Amended Complaint17 dated July 28, 1986 to
3.) Such amounts of moral and exemplary damages as may include, as party plaintiff, Chemical Industries of the Philippines,
be warranted by the evidence adduced, to plaintiff Ethel Inc. (Chemphil), Garcias employer, who claimed to have paid for
Brunty; the latters medical and hospitalization expenses, the services
4.) At least P64,057.61 as actual damages representing rendered by the funeral parlor of the deceased, and the expenses in
medical expenses to plaintiff Juan Manuel M. Garcia and at transferring the remains of Rhonda Brunty to the United States. 18
least P1,000,000.00 as unearned or lost income of said After trial on the merits, the RTC rendered its Decision 19 on May
plaintiff; 21, 1990 in favor of plaintiffs. The fallo reads:
5.) At least P72,760.00 as actual damages representing cost WHEREFORE, judgment is hereby rendered in favor of the
of the Mercedes Benz car to plaintiff Juan Manuel M. plaintiffs Ethel Brunty and Juan Manuel M. Garcia and against the
Garcia; defendant Philippine National Railways directing the latter to pay
6.) Such amounts of moral and exemplary damages as may the former the sum of:
be warranted by the evidence adduced, to plaintiff Juan 1. Thirty Thousand Pesos (P30,000.00) Philippine Currency,
Manuel M. Garcia; and for the death of Rhonda Brunty formerly a resident of 1595
7.) Attorneys fees equivalent to at least 15% of the total Ashland Avenue, Des Plaines, Illinois, U.S.A.;
award to plaintiffs herein.12 2. One Million Pesos (P1,000,000.00) Philippine Currency
In its Answer,13 PNR claimed that it exercised the diligence of a for moral and actual damages due the heirs of Rhonda
good father of a family not only in the selection but also in the Brunty;
supervision of its employees.14 By way of special and affirmative 3. Seventy-Two Thousand Seven Hundred Sixty Pesos
defense, it stressed that it had the right of way on the railroad (P72,760.00) Philippine Currency for damages sustained by
crossing in question, and that it has no legal duty to put up a bar the Mercedes Benz;
or red light signal in any such crossing. It insisted that there were 4. Fifty Thousand Pesos (P50,000.00) Philippine Currency
adequate, visible, and clear warning signs strategically posted on as and for attorney's fees, and;
the sides of the road before the railroad crossing. It countered that 5. Costs of suit.
the immediate and proximate cause of the accident was Mercelitas SO ORDERED.20
negligence, and that he had the last clear chance to avoid the

Page 45 of 205
Aggrieved, the PNR appealed the case to the CA, raising the appellant was negligent in not exercising due diligence of a good
following errors: father of a family in the supervision of its employees, particularly
I. the train operator Alfonso Reyes;29 the car was driven in a careful
THE TRIAL COURT ERRED IN ADJUDGING DEFENDANT- and diligent manner, and at a moderate speed, with due regard to
APPELLANT PNR LIABLE FOR THE DEATH OF RHONDA all traffic rules and regulations at that particular time; 30 the
BRUNTY AND THE CONSEQUENT AWARD OF DAMAGES doctrine of "last clear chance" is not applicable;31 Ethel Brunty is a
DUE THE HEIRS OF RHONDA BRUNTY. non-resident alien who can rightfully file the instant case;32 and
II. they are entitled to recover damages from appellant. 33
THE TRIAL COURT ERRED IN ADJUDGING DEFENDANT- The CA rendered the assailed Decision34 on August 15, 2005. The
APPELLANT PNR LIABLE FOR THE DAMAGES SUFFERED dispositive portion reads:
BY PLAINTIFF-APPELLEES MERCEDES BENZ IN THE WHEREFORE, premises considered, the assailed decision is hereby
AMOUNT OF SEVENTY-TWO THOUSAND SEVEN AFFIRMED with PARTIAL MODIFICATIONS, increasing the death
HUNDRED AND SIXTY PESOS (P72,760.00). indemnity award from P30,000.00 to P50,000.00, and deleting the
III. award for damages sustained by the Mercedes Benz.
THE LOWER COURT ERRED IN AWARDING ATTORNEYS SO ORDERED.35
FEES TO THE PLAINTIFFS-APPELLEES.21 The appellate court affirmed the findings of the RTC as to the
In its Brief, PNR insisted that the sole and proximate cause of the negligence of the PNR. Considering the circumstances prevailing at
accident was the negligence and recklessness of Garcia and the time of the fatal accident, it ruled that the alleged safety
Mercelita.22 It insisted that it had provided adequate warning measures installed by the PNR at the railroad crossing were not
signals at the railroad crossing23 and had exercised due care in the merely inadequate they did not satisfy the well-settled safety
selection and supervision of its employees.24 The RTC erred in standards in transportation.36 However, the CA did not agree with
awarding damages to Rhonda Brunty as she cannot be allowed to the RTCs findings on the contributory negligence of Mercelita, the
receive what she is not in a position to give, having been a non- driver of the Mercedes Benz. It held that Mercelita could not have
resident alien who did not own a property in the Philippines. 25 It foreseen the harm that would befall him and the two other
likewise questioned the award of damages on the Mercedes Benz as passengers under the prevailing circumstances, thus, could not be
well as the grant of attorneys fees.26 At the very least, Mercelita considered guilty of contributory negligence.37
was guilty of contributory negligence.27 The PNR, now petitioner, comes before this Court in this Petition
For their part, appellees countered that appellant was grossly and for Review on Certiorari on the following grounds:
recklessly negligent in not properly providing the necessary I.
equipment at the railroad crossing in Rizal, Moncada, Tarlac; 28

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THE COURT OF APPEALS ERRED IN MANIFESTLY and equipment within the area or scene of the accident was the
OVERLOOKING CERTAIN RELEVANT FACTS NOT DISPUTED BY proximate cause of the mishap.43 While it is true that as a general
THE PARTIES AND WHICH, IF PROPERLY CONSIDERED, WOULD rule, the trial court is in the best position to evaluate and observe
JUSTIFY A DIFFERENT CONCLUSION SUCH AS: the conduct and demeanor of the witnesses presented during the
THE RESPONDENTS DRIVER OVERTOOK ANOTHER VEHICLE BY trial, the CA, in the exercise of its appellate jurisdiction, has the
ACCELERATING AT 70 KILOMETERS PER HOUR WITHIN JUST 50 vested right to modify, reject, or set aside the trial courts
YARDS AWAY FROM THE RAILROAD TRACKS. evaluation and findings.44 As to the application of the doctrine of
II. last clear chance, respondents claim that said issue is being raised
THE FINDINGS OF FACT OF THE COURT OF APPEALS ARE for the first time in this petition.45 Lastly, respondents cite foreign
CONTRARY TO THOSE OF THE TRIAL COURT REGARDING jurisprudence stating that if the violation is one which gives rise to
CONTRIBUTORY NEGLIGENCE OF THE RESPONDENTS DRIVER. liability per se for any resulting injury, the defenses ordinarily
III. available in actions for diligence are barred and the contributory
THE COURT OF APPEALS ERRED IN NOT APPLYING THE negligence of the person injured is no defense.46
DOCTRINE OF LAST CLEAR CHANCE IN THE INSTANT CASE. 38 The Court is thus tasked to answer the following factual
Petitioner insists that the proximate cause of the mishap was questions: (1) As between petitioner and Mercelita, whose
Mercelitas disregard of traffic rules and regulations. Had the court negligence resulted in the unfortunate collision? (2) Is
considered the fact that Mercelita had overtaken another vehicle a Mercelita (the driver of the Mercedes Benz) guilty of
few yards before the railroad track, it would have reached a contributory negligence? Finally, the application in this case
different conclusion.39 Moreover, petitioner asserts, considering of the doctrine of last clear chance is likewise in question.
that the decisions of the RTC and the CA vary as to whether or not Negligence is the omission to do something which a reasonable
Mercelita was guilty of contributory negligence, the findings of the man, guided by those considerations which ordinarily regulate
RTC should prevail. Thus, Mercelitas contributory negligence the conduct of human affairs, would do, or the doing of
should not have been ignored.40 Lastly, petitioner avers that since something which a prudent and reasonable man would not
there is freedom of control and greater maneuverability on the part do.47 In Corliss v. Manila Railroad Company,48 this Court held that
of motor vehicles, it is obvious that in railroad crossings, they have negligence is want of the care required by the circumstances. It is a
the last clear chance to prevent or avoid an unwanted accident relative or comparative, not an absolute, term and its application
from taking place.41 depends upon the situation of the parties and the degree of care
In their Comment42 on the petition, respondents reiterate the and vigilance which the circumstances reasonably require.49 In
findings of the RTC and the CA that the breach by petitioner of its determining whether or not there is negligence on the part of the
legal duty to provide adequate and necessary public safety device parties in a given situation, jurisprudence50 has laid down the

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following test: Did defendant, in doing the alleged negligent act, use In a long line of cases, the Court held that in order to sustain a
that reasonable care and caution which an ordinarily prudent claim based on quasi-delict, the following requisites must
person would have used in the same situation? If not, the person is concur: (1) damage to plaintiff; (2) negligence, by act or
guilty of negligence. The law, in effect, adopts the standard omission, of which defendant, or some person for whose acts
supposed to be supplied by the imaginary conduct of the discreet he must respond was guilty; and (3) connection of cause and
pater familias of the Roman law. effect between such negligence and damage.53 Applying the
The issue of who, between the parties, was negligent was foregoing requisites, the CA correctly made the following
thoroughly discussed by both the RTC and the CA. In petitions for conclusions:
review under Rule 45 of the Revised Rules of Court, only questions It was clearly established that plaintiffs-appellees (respondents
of law may be put into issue, and questions of fact as a general herein) sustained damage or injury as a result of the collision. That
rule, cannot be entertained. The finding of negligence by the RTC, there was negligence on the part of PNR is, likewise, beyond cavil.
as affirmed by the CA, is a question of fact which this Court cannot Considering the circumstances prevailing at the time of the fatal
pass upon as it would entail going into factual matters on which accident, the alleged safety measures installed by the PNR at the
the finding of negligence was based.51 The established rule is that railroad crossing is not only inadequate but does not satisfy well-
factual findings of the CA affirming those of the trial court are settled safety standards in transportation. x x x
conclusive and binding on this Court.52 xxxx
The records of the instant case show that both the RTC and the CA x x x An examination of the photographs of the railroad crossing at
carefully examined the factual circumstances surrounding the Moncada, Tarlac presented as evidence by PNR itself would yield
case, and we find no cogent reason to disturb the same. It is, the following: (1.) absence of flagbars or safety railroad bars; (2.)
however, worthy to emphasize that petitioner was found inadequacy of the installed warning signals; and (3.) lack of proper
negligent because of its failure to provide the necessary safety lighting within the area. Thus, even if there was a flagman
device to ensure the safety of motorists in crossing the stationed at the site as claimed by PNR (petitioner), it would still be
railroad track. As such, it is liable for damages for violating the impossible to know or see that there is a railroad crossing/tracks
provisions of Article 2176 of the New Civil Code, viz: ahead, or that there is an approaching train from the Moncada side
Article 2176. Whoever, by act or omission, causes damage to of the road since ones view would be blocked by a cockpit arena. x
another, there being fault or negligence, is obliged to pay for x x54
the damage done. Such fault or negligence, if there is no pre- Moreover, the CA held that a vehicle coming from the Moncada side
existing contractual relation between the parties, is called a would have difficulty in knowing that there is an approaching train
quasi-delict and is governed by the provisions of this Chapter. because of the slight curve, more so, at an unholy hour as 2:00

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a.m. Thus, it is imperative on the part of the PNR to provide danger to health and body.60 To prove contributory negligence, it is
adequate safety equipment in the area.55 still necessary to establish a causal link, although not proximate,
It may broadly be stated that railroad companies owe to the public between the negligence of the party and the succeeding injury. In a
a duty of exercising a reasonable degree of care to avoid injury to legal sense, negligence is contributory only when it contributes
persons and property at railroad crossings, which duties pertain proximately to the injury, and not simply a condition for its
both in the operation of trains and in the maintenance of the occurrence.61
crossings.56 Moreover, every corporation constructing or operating The court below found that there was a slight curve before
a railway shall make and construct at all points where such approaching the tracks; the place was not properly illuminated;
railway crosses any public road, good, sufficient, and safe ones view was blocked by a cockpit arena; and Mercelita was not
crossings and erect at such points, at a sufficient elevation from familiar with the road. Yet, it was also established that Mercelita
such road as to admit a free passage of vehicles of every kind, a was then driving the Mercedes Benz at a speed of 70 km/hr and, in
sign with large and distinct letters placed thereon, to give notice of fact, had overtaken a vehicle a few yards before reaching the
the proximity of the railway, and warn persons of the necessity of railroad track. Mercelita should not have driven the car the way he
looking out for trains.57 did. However, while his acts contributed to the collision, they
This Court has previously determined the liability of the PNR for nevertheless do not negate petitioners liability. Pursuant to Article
damages for its failure to put a cross bar, or signal light, flagman 217962 of the New Civil Code, the only effect such contributory
or switchman, or semaphores. Such failure is evidence of negligence could have is to mitigate liability, which, however, is not
negligence and disregard of the safety of the public, even if there is applicable in this case, as will be discussed later.1wphi1
no law or ordinance requiring it because public safety demands As to whether or not the doctrine of last clear chance is applicable,
that said device or equipment be installed.58 we rule in the negative. The doctrine of last clear chance states
In view of the foregoing, we affirm the factual findings of the CA as that where both parties are negligent but the negligent act of
well as its conclusion on petitioners negligence. one is appreciably later than that of the other, or where it is
As to whether or not Mercelita was guilty of contributory impossible to determine whose fault or negligence caused the
negligence, we agree with petitioner. Contributory negligence is loss, the one who had the last clear opportunity to avoid the
conduct on the part of the injured party, contributing as a loss but failed to do so, is chargeable with the loss. Stated
legal cause to the harm he has suffered, which falls below the differently, the antecedent negligence of plaintiff does not preclude
standard to which he is required to conform for his own him from recovering damages caused by the supervening
protection.59 To hold a person as having contributed to his negligence of defendant, who had the last fair chance to prevent
injuries, it must be shown that he performed an act that brought the impending harm by the exercise of due diligence.63 The
about his injuries in disregard of warning or signs of an impending proximate cause of the injury having been established to be the

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negligence of petitioner, we hold that the above doctrine finds no would be unfair for the victims heirs to get nothing, despite the
application in the instant case. death of their kin, for the reason alone that they cannot produce
We note that the damages awarded by the appellate court consist receipts.66
of (1) P50,000.00 as indemnity for the death of Rhonda Brunty; (2) The relatives of the victim who incurred physical injuries in a
P1,000,000.00 as actual and moral damages due the heirs of quasi-delict are not proscribed from recovering moral damages in
Rhonda Brunty; and (3) P50,000.00 as and by way of attorneys meritorious cases.67 We, therefore, sustain the award of moral
fees. No damages, however, were awarded for the injuries suffered damages in favor of the heirs of Rhonda Brunty.
by Garcia, yet, the latter never interposed an appeal before the CA Moral damages are not punitive in nature, but are designed to
nor even before this Court. The record is, likewise, bereft of any compensate and alleviate in some way the physical suffering,
allegation and proof as to the relationship between Mercelita (the mental anguish, fright, serious anxiety, besmirched
driver) and Rhonda Brunty. Hence, the earlier finding of reputation, wounded feelings, moral shock, social humiliation,
contributory negligence on the part of Mercelita, which generally and similar injury unjustly caused a person. Although
has the effect of mitigation of liability, does not apply. incapable of pecuniary computation, moral damages must
As to the amount of damages awarded, a modification of the same nevertheless be somehow proportional to and in approximation
is in order, specifically on the award of actual and moral damages of the suffering inflicted.68 In the instant case, the moral
in the aggregate amount of P1,000,000.00. suffering of the heirs of Rhonda Brunty was sufficiently established
Actual or compensatory damages are those awarded in order to by Ethel Brunty in her deposition, 69 viz:
compensate a party for an injury or loss he suffered. They Q: What have you felt as a result of the death of Rhonda?
arise out of a sense of natural justice, aimed at repairing the A: I felt earnest anguish and mixed feelings of anger and extreme
wrong done. To be recoverable, they must be duly proved with sorrow because she died so far away and alone, and because her
a reasonable degree of certainty. A court cannot rely on death could so easily be prevented if there had been adequate and
speculation, conjecture, or guesswork as to the fact and amount of appropriate warning signals at the railroad crossing and it is just
damages, but must depend upon competent proof that they have an unbearable and irreparable loss. In so many ways, she was my
suffered, and on evidence of the actual amount thereof. 64 life. It seemed to me that losing her was just like losing my own
Respondents, however, failed to present evidence for such life, or worst, and even now, there is no end to our bereavement. I
damages; hence, the award of actual damages cannot be sustained. am still on constant medication to be able to sleep and to be able to
However, as the heirs of Rhonda Brunty undeniably incurred perform my duties effectively in my job but it does not take away
expenses for the wake and burial of the latter, we deem it proper to the pain of loss.70
award temperate damages in the amount of P25,000.00 pursuant In People v. Teehankee, Jr.,71 and in Metro Manila Transit
to prevailing jurisprudence.65 This is in lieu of actual damages as it Corporation v. Court of Appeals,72 we awarded moral damages in

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the amount of P1,000,000.00 to the heirs of the deceased. In
Victory Liner, Inc. v. Heirs of Malecdan, 73 the award of
P100,000.00 as moral damages was held in keeping with the
purpose of the law, while in Macalinao v. Ong, 74 the amount of
P50,000.00 was held sufficient.1wphi1
Considering the circumstances attendant in this case, we find that
an award of P500,000.00 as moral damages to the heirs of Rhonda
Brunty is proper. In view of recent jurisprudence, indemnity of
P50,000.00 for the death of Rhonda Brunty and attorneys fees
amounting to P50,000.00 is likewise proper.
WHEREFORE, premises considered, the Decision of the Court of
Appeals dated August 15, 2005 is AFFIRMED WITH
MODIFICATIONS. The award of actual damages is deleted, and in
lieu thereof, temperate damages of P25,000.00 is awarded to the
heirs of Rhonda Brunty. The award of moral damages is reduced to
P500,000.00.
SO ORDERED.

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Republic of the Philippines one Vicente Mangyao, who just closed his store in
SUPREME COURT market in order to celebrate the coming of the New
Manila Year, and who saw the incident right before him,
FIRST DIVISION shouted at the appellant to stop. He ran after
G.R. No. L-40452 October 12, 1989 appellant when the latter refused to stop.
GREGORIO GENOBIAGON, petitioner, Overtaking the appellant, Mangyao asked him why
vs. he bumped the old woman and his answer was, 'it
COURT OF APPEALS and PEOPLE OF THE PHILIPPINES, was the old woman that bumped him.' The appellant
respondents. went back to the place where the old woman was
Mario D. Ortiz for petitioner. struck by his rig. The old woman was unconscious,
and the food and viands she was carrying were
GRIO-AQUINO, J.: scattered on her body. The victim was then loaded in
This is a petition for review of the Court of Appeals' decision in CA- a jeep and brought to the hospital where she died
G.R. No. 09949-CR, dated October 10, 1974, affirming the three hours later (Exh. C). The findings after an
conviction of the petitioner of the crime of homicide thru reckless autopsy are as follows:
imprudence. Contusion with Hematoma Left,
As found by the Court of Appeals, the facts of this case are: Frontal and Occipito-Parietal
On December 31,1959, at about 7:30 o'clock in the Regionas Fracture Occipito-Parietal
evening, a rig driven by appellant bumped an old Bone Cerebral Hemorrhage.
woman who was crossing T. Padilla St., Cebu City, The deceased was an eighty-one-year old woman
at the right side of T. Padilla Market. The appellant's named Rita B. Cabrera. (pp. 31-32, Rollo.)
rig was following another at a distance of two Petitioner was charged with homicide thru reckless imprudence in
meters. The old woman started to cross when the the Court of First Instance of Cebu (Crim. Case No. V7855). The
first rig was approaching her, but as appellant's trial court found petitioner guilty of the felony charged and
vehicle was going so fast not only because of the sentenced him to "suffer an indeterminate penalty of three (3)
steep down-grade of the road, but also because he months of arresto mayor as minimum to one (1) year, one (1)
was trying to overtake the rig ahead of him, the month and eleven (11) days of prision correccional as maximum, to
appellant's rig bumped the old woman, who as a indemnify the heirs of Rita Banzon Cabrera the sum of P6,000 with
consequence, fell at the middle of the road. The subsidiary imprisonment in case of insolvency, not to exceed 1/3 of
appellant continued to drive on, but a by-stander,

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the principal penalty and to pay the costs" (p. 3, Appellant's Brief, that findings of fact of the trial court and the Court of Appeals are
p. 56, Rollo). binding upon us (Bernardo vs. Bernardo, 101 SCRA 351; Vda. De
The petitioner appealed to the Court of Appeals (CA-G.R. 09949- Roxas vs. IAC, 143 SCRA 77; Republic vs. IAC, 144 SCRA 705).
CR)which,on October 10,1974,conviction of the accused but The alleged contributory negligence of the victim, if any, does not
increased his civil liability to P12,000. The dispositive portion of its exonerate the accused. "The defense of contributory negligence
decision reads: does not apply in criminal cases committed through reckless
WHEREFORE, finding no error in the judgment imprudence, since one cannot allege the negligence of another
appealed from except in the amount of indemnity to to evade the effects of his own negligence (People vs. Orbeta,
be paid to the heirs of the deceased, Rita B. Cabrera, CA-G.R. No. 321, March 29,1947)." (People vs. Quinones, 44 O.G.
which is the sum of P6,000.00 with subsidiary 1520).
imprisonment in case of insolvency which should be The petitioner's contention that the Court of Appeals unjustly
raised to P12,000.00 (People vs. Pantoja, G.R. No. L- increased his civil liability to P12,000, is devoid of merit. The
18793, October 11, 1968, 25 SCRA 468) but without prevailing jurisprudence in fact provides that indemnity for death
subsidiary imprisonment in case of insolvency, the in homicide or murder is P30,000 (People vs. De la Fuente,
same should be, as it is hereby affirmed in all other [1983]126 SCRA 518; People vs. Centeno, 130 SCRA 198).
respects with costs. (P. 37, Rollo.) Accordingly, the civil liability of the petitioner is increased to
After his motion for reconsideration of the Court of Appeals' P30,000.
decision was denied, he filed a petition for review in this Court, WHEREFORE, the appealed decision is affirmed with modification
alleging that the Court of Appeals erred: as to the civil liability of the petitioner which is hereby increased to
1. in not finding that the reckless negligence of the P30,000. Costs against petitioner.
victim was the proximate cause of the accident SO ORDERED.
which led to her death;
2. in not acquitting the petitioner on the ground of
reasonable doubt; and
3. in unjustly increasing the civil liability of the
petitioner from P6,000.00 to P12,000.00, although
the circumstances of the victim and the accused
(petitioner) do not warrant such increase.
It is quite evident that all the issues raised in the petition for
review are factual. Well-entrenched in our jurisprudence is the rule

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Republic of the Philippines (2) poked his gun toward Divina Mata and Isabelita
SUPREME COURT Rodriguez and ordered them to lay (sic) face flat on the
Manila floor. Suspects asked forcibly the case and assorted pawned
THIRD DIVISION jewelries items mentioned above.
G.R. No. 159617 August 8, 2007 Suspects after taking the money and jewelries fled on board
ROBERTO C. SICAM and AGENCIA de R.C. SICAM, INC., a Marson Toyota unidentified plate number.3
petitioners, Petitioner Sicam sent respondent Lulu a letter dated October 19,
vs. 1987 informing her of the loss of her jewelry due to the robbery
LULU V. JORGE and CESAR JORGE, respondents. incident in the pawnshop. On November 2, 1987, respondent Lulu
DECISION then wrote a letter4 to petitioner Sicam expressing disbelief stating
AUSTRIA-MARTINEZ, J.: that when the robbery happened, all jewelry pawned were
Before us is a Petition for Review on Certiorari filed by Roberto C. deposited with Far East Bank near the pawnshop since it had been
Sicam, Jr. (petitioner Sicam) and Agencia de R.C. Sicam, Inc. the practice that before they could withdraw, advance notice must
(petitioner corporation) seeking to annul the Decision 1 of the Court be given to the pawnshop so it could withdraw the jewelry from the
of Appeals dated March 31, 2003, and its Resolution 2 dated August bank. Respondent Lulu then requested petitioner Sicam to prepare
8, 2003, in CA G.R. CV No. 56633. the pawned jewelry for withdrawal on November 6, 1987 but
It appears that on different dates from September to October 1987, petitioner Sicam failed to return the jewelry.
Lulu V. Jorge (respondent Lulu) pawned several pieces of jewelry On September 28, 1988, respondent Lulu joined by her husband,
with Agencia de R. C. Sicam located at No. 17 Aguirre Ave., BF Cesar Jorge, filed a complaint against petitioner Sicam with the
Homes Paraaque, Metro Manila, to secure a loan in the total Regional Trial Court of Makati seeking indemnification for the loss
amount of P59,500.00. of pawned jewelry and payment of actual, moral and exemplary
On October 19, 1987, two armed men entered the pawnshop and damages as well as attorney's fees. The case was docketed as Civil
took away whatever cash and jewelry were found inside the Case No. 88-2035.
pawnshop vault. The incident was entered in the police blotter of Petitioner Sicam filed his Answer contending that he is not the real
the Southern Police District, Paraaque Police Station as follows: party-in-interest as the pawnshop was incorporated on April 20,
Investigation shows that at above TDPO, while victims were 1987 and known as Agencia de R.C. Sicam, Inc; that petitioner
inside the office, two (2) male unidentified persons entered corporation had exercised due care and diligence in the
into the said office with guns drawn. Suspects(sic) (1) went safekeeping of the articles pledged with it and could not be made
straight inside and poked his gun toward Romeo Sicam and liable for an event that is fortuitous.
thereby tied him with an electric wire while suspects (sic)

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Respondents subsequently filed an Amended Complaint to include Regional Trial Court of Makati, Branch 62, is hereby
petitioner corporation. REVERSED and SET ASIDE, ordering the appellees to pay
Thereafter, petitioner Sicam filed a Motion to Dismiss as far as he appellants the actual value of the lost jewelry amounting to
is concerned considering that he is not the real party-in-interest. P272,000.00, and attorney' fees of P27,200.00.8
Respondents opposed the same. The RTC denied the motion in an In finding petitioner Sicam liable together with petitioner
Order dated November 8, 1989.5 corporation, the CA applied the doctrine of piercing the veil of
After trial on the merits, the RTC rendered its Decision 6 dated corporate entity reasoning that respondents were misled into
January 12, 1993, dismissing respondents complaint as well as thinking that they were dealing with the pawnshop owned by
petitioners counterclaim. The RTC held that petitioner Sicam could petitioner Sicam as all the pawnshop tickets issued to them bear
not be made personally liable for a claim arising out of a corporate the words "Agencia de R.C. Sicam"; and that there was no
transaction; that in the Amended Complaint of respondents, they indication on the pawnshop tickets that it was the petitioner
asserted that "plaintiff pawned assorted jewelries in defendants' corporation that owned the pawnshop which explained why
pawnshop"; and that as a consequence of the separate juridical respondents had to amend their complaint impleading petitioner
personality of a corporation, the corporate debt or credit is not the corporation.
debt or credit of a stockholder. The CA further held that the corresponding diligence required of a
The RTC further ruled that petitioner corporation could not be held pawnshop is that it should take steps to secure and protect the
liable for the loss of the pawned jewelry since it had not been pledged items and should take steps to insure itself against the
rebutted by respondents that the loss of the pledged pieces of loss of articles which are entrusted to its custody as it derives
jewelry in the possession of the corporation was occasioned by earnings from the pawnshop trade which petitioners failed to do;
armed robbery; that robbery is a fortuitous event which exempts that Austria is not applicable to this case since the robbery
the victim from liability for the loss, citing the case of Austria v. incident happened in 1961 when the criminality had not as yet
Court of Appeals;7 and that the parties transaction was that of a reached the levels attained in the present day; that they are at
pledgor and pledgee and under Art. 1174 of the Civil Code, the least guilty of contributory negligence and should be held liable for
pawnshop as a pledgee is not responsible for those events which the loss of jewelries; and that robberies and hold-ups are
could not be foreseen. foreseeable risks in that those engaged in the pawnshop business
Respondents appealed the RTC Decision to the CA. In a Decision are expected to foresee.
dated March 31, 2003, the CA reversed the RTC, the dispositive The CA concluded that both petitioners should be jointly and
portion of which reads as follows: severally held liable to respondents for the loss of the pawned
WHEREFORE, premises considered, the instant Appeal is jewelry.
GRANTED, and the Decision dated January 12, 1993,of the

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Petitioners motion for reconsideration was denied in a Resolution (2) The issue resolved against petitioner Sicam was not
dated August 8, 2003. among those raised and litigated in the trial court; and
Hence, the instant petition for review with the following assignment (3) By reason of the above infirmities, it was error for the CA
of errors: to have pierced the corporate veil since a corporation has a
THE COURT OF APPEALS ERRED AND WHEN IT DID, IT personality distinct and separate from its individual
OPENED ITSELF TO REVERSAL, WHEN IT ADOPTED stockholders or members.
UNCRITICALLY (IN FACT IT REPRODUCED AS ITS OWN Anent the second error, petitioners point out that the CA finding on
WITHOUT IN THE MEANTIME ACKNOWLEDGING IT) WHAT their negligence is likewise an unedited reproduction of
THE RESPONDENTS ARGUED IN THEIR BRIEF, WHICH respondents brief which had the following defects:
ARGUMENT WAS PALPABLY UNSUSTAINABLE. (1) There were unrebutted evidence on record that
THE COURT OF APPEALS ERRED, AND WHEN IT DID, IT petitioners had observed the diligence required of them, i.e,
OPENED ITSELF TO REVERSAL BY THIS HONORABLE they wanted to open a vault with a nearby bank for
COURT, WHEN IT AGAIN ADOPTED UNCRITICALLY (BUT purposes of safekeeping the pawned articles but was
WITHOUT ACKNOWLEDGING IT) THE SUBMISSIONS OF discouraged by the Central Bank (CB) since CB rules
THE RESPONDENTS IN THEIR BRIEF WITHOUT ADDING provide that they can only store the pawned articles in a
ANYTHING MORE THERETO DESPITE THE FACT THAT vault inside the pawnshop premises and no other place;
THE SAID ARGUMENT OF THE RESPONDENTS COULD (2) Petitioners were adjudged negligent as they did not take
NOT HAVE BEEN SUSTAINED IN VIEW OF UNREBUTTED insurance against the loss of the pledged jelweries, but it is
EVIDENCE ON RECORD.9 judicial notice that due to high incidence of crimes,
Anent the first assigned error, petitioners point out that the CAs insurance companies refused to cover pawnshops and
finding that petitioner Sicam is personally liable for the loss of the banks because of high probability of losses due to
pawned jewelries is "a virtual and uncritical reproduction of the robberies;
arguments set out on pp. 5-6 of the Appellants brief."10 (3) In Hernandez v. Chairman, Commission on Audit (179
Petitioners argue that the reproduced arguments of respondents in SCRA 39, 45-46), the victim of robbery was exonerated from
their Appellants Brief suffer from infirmities, as follows: liability for the sum of money belonging to others and lost
(1) Respondents conclusively asserted in paragraph 2 of by him to robbers.
their Amended Complaint that Agencia de R.C. Sicam, Inc. Respondents filed their Comment and petitioners filed their Reply
is the present owner of Agencia de R.C. Sicam Pawnshop, thereto. The parties subsequently submitted their respective
and therefore, the CA cannot rule against said conclusive Memoranda.
assertion of respondents; We find no merit in the petition.

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To begin with, although it is true that indeed the CA findings were all bear the words "Agencia de R. C. Sicam," notwithstanding that
exact reproductions of the arguments raised in respondents the pawnshop was allegedly incorporated in April 1987. The
(appellants) brief filed with the CA, we find the same to be not receipts issued after such alleged incorporation were still in the
fatally infirmed. Upon examination of the Decision, we find that it name of "Agencia de R. C. Sicam," thus inevitably misleading, or at
expressed clearly and distinctly the facts and the law on which it is the very least, creating the wrong impression to respondents and
based as required by Section 8, Article VIII of the Constitution. The the public as well, that the pawnshop was owned solely by
discretion to decide a case one way or another is broad enough to petitioner Sicam and not by a corporation.
justify the adoption of the arguments put forth by one of the Even petitioners counsel, Atty. Marcial T. Balgos, in his letter 16
parties, as long as these are legally tenable and supported by law dated October 15, 1987 addressed to the Central Bank, expressly
and the facts on records.11 referred to petitioner Sicam as the proprietor of the pawnshop
Our jurisdiction under Rule 45 of the Rules of Court is limited to notwithstanding the alleged incorporation in April 1987.
the review of errors of law committed by the appellate court. We also find no merit in petitioners' argument that since
Generally, the findings of fact of the appellate court are deemed respondents had alleged in their Amended Complaint that
conclusive and we are not duty-bound to analyze and calibrate all petitioner corporation is the present owner of the pawnshop, the
over again the evidence adduced by the parties in the court a quo.12 CA is bound to decide the case on that basis.
This rule, however, is not without exceptions, such as where the Section 4 Rule 129 of the Rules of Court provides that an
factual findings of the Court of Appeals and the trial court are admission, verbal or written, made by a party in the course of the
conflicting or contradictory13 as is obtaining in the instant case. proceedings in the same case, does not require proof. The
However, after a careful examination of the records, we find no admission may be contradicted only by showing that it was made
justification to absolve petitioner Sicam from liability. through palpable mistake or that no such admission was made.
The CA correctly pierced the veil of the corporate fiction and Thus, the general rule that a judicial admission is conclusive upon
adjudged petitioner Sicam liable together with petitioner the party making it and does not require proof, admits of two
corporation. The rule is that the veil of corporate fiction may be exceptions, to wit: (1) when it is shown that such admission was
pierced when made as a shield to perpetrate fraud and/or confuse made through palpable mistake, and (2) when it is shown that no
legitimate issues. 14 The theory of corporate entity was not meant such admission was in fact made. The latter exception allows
to promote unfair objectives or otherwise to shield them.15 one to contradict an admission by denying that he made such
Notably, the evidence on record shows that at the time respondent an admission.17
Lulu pawned her jewelry, the pawnshop was owned by petitioner The Committee on the Revision of the Rules of Court explained the
Sicam himself. As correctly observed by the CA, in all the second exception in this wise:
pawnshop receipts issued to respondent Lulu in September 1987,

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x x x if a party invokes an "admission" by an adverse party, corporation. In paragraph 1 of his Answer, he admitted the
but cites the admission "out of context," then the one allegations in paragraph 1 and 2 of the Complaint. He
making the "admission" may show that he made no "such" merely added "that defendant is not now the real party in
admission, or that his admission was taken out of interest in this case."
context. It was defendant Sicam's omission to correct the pawnshop
x x x that the party can also show that he made no tickets used in the subject transactions in this case which
"such admission", i.e., not in the sense in which the was the cause of the instant action. He cannot now ask for
admission is made to appear. the dismissal of the complaint against him simply on the
That is the reason for the modifier "such" because if the mere allegation that his pawnshop business is now
rule simply states that the admission may be contradicted incorporated. It is a matter of defense, the merit of which
by showing that "no admission was made," the rule would can only be reached after consideration of the evidence to
not really be providing for a contradiction of the admission be presented in due course.19
but just a denial.18 (Emphasis supplied). Unmistakably, the alleged admission made in respondents'
While it is true that respondents alleged in their Amended Amended Complaint was taken "out of context" by petitioner Sicam
Complaint that petitioner corporation is the present owner of the to suit his own purpose. Ineluctably, the fact that petitioner Sicam
pawnshop, they did so only because petitioner Sicam alleged in his continued to issue pawnshop receipts under his name and not
Answer to the original complaint filed against him that he was not under the corporation's name militates for the piercing of the
the real party-in-interest as the pawnshop was incorporated in corporate veil.
April 1987. Moreover, a reading of the Amended Complaint in its We likewise find no merit in petitioners' contention that the CA
entirety shows that respondents referred to both petitioner Sicam erred in piercing the veil of corporate fiction of petitioner
and petitioner corporation where they (respondents) pawned their corporation, as it was not an issue raised and litigated before the
assorted pieces of jewelry and ascribed to both the failure to RTC.
observe due diligence commensurate with the business which Petitioner Sicam had alleged in his Answer filed with the trial court
resulted in the loss of their pawned jewelry. that he was not the real party-in-interest because since April 20,
Markedly, respondents, in their Opposition to petitioners Motion to 1987, the pawnshop business initiated by him was incorporated
Dismiss Amended Complaint, insofar as petitioner Sicam is and known as Agencia de R.C. Sicam. In the pre-trial brief filed by
concerned, averred as follows: petitioner Sicam, he submitted that as far as he was concerned,
Roberto C. Sicam was named the defendant in the original the basic issue was whether he is the real party in interest against
complaint because the pawnshop tickets involved in this whom the complaint should be directed.20 In fact, he subsequently
case did not show that the R.C. Sicam Pawnshop was a moved for the dismissal of the complaint as to him but was not

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favorably acted upon by the trial court. Moreover, the issue was person shall be responsible for those events which could
squarely passed upon, although erroneously, by the trial court in not be foreseen or which, though foreseen, were inevitable.
its Decision in this manner: Fortuitous events by definition are extraordinary events not
x x x The defendant Roberto Sicam, Jr likewise denies foreseeable or avoidable. It is therefore, not enough that the event
liability as far as he is concerned for the reason that he should not have been foreseen or anticipated, as is commonly
cannot be made personally liable for a claim arising from a believed but it must be one impossible to foresee or to avoid. The
corporate transaction. mere difficulty to foresee the happening is not impossibility to
This Court sustains the contention of the defendant foresee the same. 22
Roberto C. Sicam, Jr. The amended complaint itself asserts To constitute a fortuitous event, the following elements must
that "plaintiff pawned assorted jewelries in defendant's concur: (a) the cause of the unforeseen and unexpected occurrence
pawnshop." It has been held that " as a consequence of the or of the failure of the debtor to comply with obligations must be
separate juridical personality of a corporation, the corporate independent of human will; (b) it must be impossible to foresee the
debt or credit is not the debt or credit of the stockholder, event that constitutes the caso fortuito or, if it can be foreseen, it
nor is the stockholder's debt or credit that of a must be impossible to avoid; (c) the occurrence must be such as to
corporation.21 render it impossible for the debtor to fulfill obligations in a normal
Clearly, in view of the alleged incorporation of the pawnshop, the manner; and, (d) the obligor must be free from any participation in
issue of whether petitioner Sicam is personally liable is inextricably the aggravation of the injury or loss. 23
connected with the determination of the question whether the The burden of proving that the loss was due to a fortuitous event
doctrine of piercing the corporate veil should or should not apply to rests on him who invokes it.24 And, in order for a fortuitous event
the case. to exempt one from liability, it is necessary that one has committed
The next question is whether petitioners are liable for the loss of no negligence or misconduct that may have occasioned the loss. 25
the pawned articles in their possession. It has been held that an act of God cannot be invoked to protect a
Petitioners insist that they are not liable since robbery is a person who has failed to take steps to forestall the possible adverse
fortuitous event and they are not negligent at all. consequences of such a loss. One's negligence may have concurred
We are not persuaded. with an act of God in producing damage and injury to another;
Article 1174 of the Civil Code provides: nonetheless, showing that the immediate or proximate cause of the
Art. 1174. Except in cases expressly specified by the law, or damage or injury was a fortuitous event would not exempt one
when it is otherwise declared by stipulation, or when the from liability. When the effect is found to be partly the result of a
nature of the obligation requires the assumption of risk, no person's participation -- whether by active intervention, neglect or

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failure to act -- the whole occurrence is humanized and removed third parties and that neither the claimant nor the
from the rules applicable to acts of God. 26 person alleged to be negligent has any participation. In
Petitioner Sicam had testified that there was a security guard in accordance with the Rules of Evidence, the burden of
their pawnshop at the time of the robbery. He likewise testified that proving that the loss was due to a fortuitous event rests
when he started the pawnshop business in 1983, he thought of on him who invokes it which in this case is the
opening a vault with the nearby bank for the purpose of private respondent. However, other than the police report
safekeeping the valuables but was discouraged by the Central of the alleged carnapping incident, no other evidence was
Bank since pawned articles should only be stored in a vault inside presented by private respondent to the effect that the
the pawnshop. The very measures which petitioners had allegedly incident was not due to its fault. A police report of an
adopted show that to them the possibility of robbery was not only alleged crime, to which only private respondent is privy,
foreseeable, but actually foreseen and anticipated. Petitioner does not suffice to establish the carnapping. Neither does it
Sicams testimony, in effect, contradicts petitioners defense of prove that there was no fault on the part of private
fortuitous event. respondent notwithstanding the parties' agreement at the
Moreover, petitioners failed to show that they were free from any pre-trial that the car was carnapped. Carnapping does not
negligence by which the loss of the pawned jewelry may have been foreclose the possibility of fault or negligence on the part of
occasioned. private respondent.28
Robbery per se, just like carnapping, is not a fortuitous event. It Just like in Co, petitioners merely presented the police report of the
does not foreclose the possibility of negligence on the part of herein Paraaque Police Station on the robbery committed based on the
petitioners. In Co v. Court of Appeals,27 the Court held: report of petitioners' employees which is not sufficient to establish
It is not a defense for a repair shop of motor vehicles to robbery. Such report also does not prove that petitioners were not
escape liability simply because the damage or loss of a at fault.
thing lawfully placed in its possession was due to On the contrary, by the very evidence of petitioners, the CA did not
carnapping. Carnapping per se cannot be considered as a err in finding that petitioners are guilty of concurrent or
fortuitous event. The fact that a thing was unlawfully and contributory negligence as provided in Article 1170 of the Civil
forcefully taken from another's rightful possession, as Code, to wit:
in cases of carnapping, does not automatically give rise Art. 1170. Those who in the performance of their
to a fortuitous event. To be considered as such, obligations are guilty of fraud, negligence, or delay, and
carnapping entails more than the mere forceful taking those who in any manner contravene the tenor thereof, are
of another's property. It must be proved and established liable for damages.29
that the event was an act of God or was done solely by

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Article 2123 of the Civil Code provides that with regard to guilty of negligence in the operation of their pawnshop business.
pawnshops and other establishments which are engaged in making Petitioner Sicam testified, thus:
loans secured by pledges, the special laws and regulations Court:
concerning them shall be observed, and subsidiarily, the provisions Q. Do you have security guards in your pawnshop?
on pledge, mortgage and antichresis. A. Yes, your honor.
The provision on pledge, particularly Article 2099 of the Civil Code, Q. Then how come that the robbers were able to enter the
provides that the creditor shall take care of the thing pledged with premises when according to you there was a security
the diligence of a good father of a family. This means that guard?
petitioners must take care of the pawns the way a prudent person A. Sir, if these robbers can rob a bank, how much more a
would as to his own property. pawnshop.
In this connection, Article 1173 of the Civil Code further provides: Q. I am asking you how were the robbers able to enter
Art. 1173. The fault or negligence of the obligor consists in despite the fact that there was a security guard?
the omission of that diligence which is required by the A. At the time of the incident which happened about 1:00
nature of the obligation and corresponds with the and 2:00 o'clock in the afternoon and it happened on a
circumstances of the persons, of time and of the place. Saturday and everything was quiet in the area BF Homes
When negligence shows bad faith, the provisions of Articles Paraaque they pretended to pawn an article in the
1171 and 2201, paragraph 2 shall apply. pawnshop, so one of my employees allowed him to come in
If the law or contract does not state the diligence which is to and it was only when it was announced that it was a hold
be observed in the performance, that which is expected of a up.
good father of a family shall be required. Q. Did you come to know how the vault was opened?
We expounded in Cruz v. Gangan30 that negligence is the omission A. When the pawnshop is official (sic) open your honor the
to do something which a reasonable man, guided by those pawnshop is partly open. The combination is off.
considerations which ordinarily regulate the conduct of human Q. No one open (sic) the vault for the robbers?
affairs, would do; or the doing of something which a prudent and A. No one your honor it was open at the time of the robbery.
reasonable man would not do.31 It is want of care required by the Q. It is clear now that at the time of the robbery the vault
circumstances. was open the reason why the robbers were able to get all
A review of the records clearly shows that petitioners failed to the items pawned to you inside the vault.
exercise reasonable care and caution that an ordinarily prudent A. Yes sir.32
person would have used in the same situation. Petitioners were revealing that there were no security measures adopted by
petitioners in the operation of the pawnshop. Evidently, no

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sufficient precaution and vigilance were adopted by petitioners to Under Section 17 of Central Bank Circular No. 374, Rules and
protect the pawnshop from unlawful intrusion. There was no clear Regulations for Pawnshops, which took effect on July 13, 1973,
showing that there was any security guard at all. Or if there was and which was issued pursuant to Presidential Decree No. 114,
one, that he had sufficient training in securing a pawnshop. Pawnshop Regulation Act, it is provided that pawns pledged must
Further, there is no showing that the alleged security guard be insured, to wit:
exercised all that was necessary to prevent any untoward incident Sec. 17. Insurance of Office Building and Pawns- The place
or to ensure that no suspicious individuals were allowed to enter of business of a pawnshop and the pawns pledged to it
the premises. In fact, it is even doubtful that there was a security must be insured against fire and against burglary as well
guard, since it is quite impossible that he would not have noticed as for the latter(sic), by an insurance company accredited
that the robbers were armed with caliber .45 pistols each, which by the Insurance Commissioner.
were allegedly poked at the employees. 33 Significantly, the alleged However, this Section was subsequently amended by CB Circular
security guard was not presented at all to corroborate petitioner No. 764 which took effect on October 1, 1980, to wit:
Sicam's claim; not one of petitioners' employees who were present Sec. 17 Insurance of Office Building and Pawns The office
during the robbery incident testified in court. building/premises and pawns of a pawnshop must be
Furthermore, petitioner Sicam's admission that the vault was open insured against fire. (emphasis supplied).
at the time of robbery is clearly a proof of petitioners' failure to where the requirement that insurance against burglary was
observe the care, precaution and vigilance that the circumstances deleted. Obviously, the Central Bank considered it not feasible to
justly demanded. Petitioner Sicam testified that once the pawnshop require insurance of pawned articles against burglary.
was open, the combination was already off. Considering petitioner The robbery in the pawnshop happened in 1987, and considering
Sicam's testimony that the robbery took place on a Saturday the above-quoted amendment, there is no statutory duty imposed
afternoon and the area in BF Homes Paraaque at that time was on petitioners to insure the pawned jewelry in which case it was
quiet, there was more reason for petitioners to have exercised error for the CA to consider it as a factor in concluding that
reasonable foresight and diligence in protecting the pawned petitioners were negligent.
jewelries. Instead of taking the precaution to protect them, they let Nevertheless, the preponderance of evidence shows that petitioners
open the vault, providing no difficulty for the robbers to cart away failed to exercise the diligence required of them under the Civil
the pawned articles. Code.
We, however, do not agree with the CA when it found petitioners The diligence with which the law requires the individual at all
negligent for not taking steps to insure themselves against loss of times to govern his conduct varies with the nature of the situation
the pawned jewelries. in which he is placed and the importance of the act which he is to
perform.34 Thus, the cases of Austria v. Court of Appeals,35

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Hernandez v. Chairman, Commission on Audit36 and Cruz v. the evening carrying jewelry of considerable value would have been
Gangan37 cited by petitioners in their pleadings, where the victims negligence per se and would not exempt her from responsibility in
of robbery were exonerated from liability, find no application to the the case of robbery. However we did not hold Abad liable for
present case. negligence since, the robbery happened ten years previously; i.e.,
In Austria, Maria Abad received from Guillermo Austria a pendant 1961, when criminality had not reached the level of incidence
with diamonds to be sold on commission basis, but which Abad obtaining in 1971.
failed to subsequently return because of a robbery committed upon In contrast, the robbery in this case took place in 1987 when
her in 1961. The incident became the subject of a criminal case robbery was already prevalent and petitioners in fact had already
filed against several persons. Austria filed an action against Abad foreseen it as they wanted to deposit the pawn with a nearby bank
and her husband (Abads) for recovery of the pendant or its value, for safekeeping. Moreover, unlike in Austria, where no negligence
but the Abads set up the defense that the robbery extinguished was committed, we found petitioners negligent in securing their
their obligation. The RTC ruled in favor of Austria, as the Abads pawnshop as earlier discussed.
failed to prove robbery; or, if committed, that Maria Abad was In Hernandez, Teodoro Hernandez was the OIC and special
guilty of negligence. The CA, however, reversed the RTC decision disbursing officer of the Ternate Beach Project of the Philippine
holding that the fact of robbery was duly established and declared Tourism in Cavite. In the morning of July 1, 1983, a Friday, he
the Abads not responsible for the loss of the jewelry on account of went to Manila to encash two checks covering the wages of the
a fortuitous event. We held that for the Abads to be relieved from employees and the operating expenses of the project. However for
the civil liability of returning the pendant under Art. 1174 of the some reason, the processing of the check was delayed and was
Civil Code, it would only be sufficient that the unforeseen event, completed at about 3 p.m. Nevertheless, he decided to encash the
the robbery, took place without any concurrent fault on the check because the project employees would be waiting for their pay
debtors part, and this can be done by preponderance of evidence; the following day; otherwise, the workers would have to wait until
that to be free from liability for reason of fortuitous event, the July 5, the earliest time, when the main office would open. At that
debtor must, in addition to the casus itself, be free of any time, he had two choices: (1) return to Ternate, Cavite that same
concurrent or contributory fault or negligence. 38 afternoon and arrive early evening; or (2) take the money with him
We found in Austria that under the circumstances prevailing at the to his house in Marilao, Bulacan, spend the night there, and leave
time the Decision was promulgated in 1971, the City of Manila and for Ternate the following day. He chose the second option, thinking
its suburbs had a high incidence of crimes against persons and it was the safer one. Thus, a little past 3 p.m., he took a passenger
property that rendered travel after nightfall a matter to be jeep bound for Bulacan. While the jeep was on Epifanio de los
sedulously avoided without suitable precaution and protection; Santos Avenue, the jeep was held up and the money kept by
that the conduct of Maria Abad in returning alone to her house in Hernandez was taken, and the robbers jumped out of the jeep and

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ran. Hernandez chased the robbers and caught up with one robber In Cruz, Dr. Filonila O. Cruz, Camanava District Director of
who was subsequently charged with robbery and pleaded guilty. Technological Education and Skills Development Authority
The other robber who held the stolen money escaped. The (TESDA), boarded the Light Rail Transit (LRT) from Sen. Puyat
Commission on Audit found Hernandez negligent because he had Avenue to Monumento when her handbag was slashed and the
not brought the cash proceeds of the checks to his office in contents were stolen by an unidentified person. Among those
Ternate, Cavite for safekeeping, which is the normal procedure in stolen were her wallet and the government-issued cellular phone.
the handling of funds. We held that Hernandez was not negligent She then reported the incident to the police authorities; however,
in deciding to encash the check and bringing it home to Marilao, the thief was not located, and the cellphone was not recovered. She
Bulacan instead of Ternate, Cavite due to the lateness of the hour also reported the loss to the Regional Director of TESDA, and she
for the following reasons: (1) he was moved by unselfish motive for requested that she be freed from accountability for the cellphone.
his co-employees to collect their wages and salaries the following The Resident Auditor denied her request on the ground that she
day, a Saturday, a non-working, because to encash the check on lacked the diligence required in the custody of government property
July 5, the next working day after July 1, would have caused and was ordered to pay the purchase value in the total amount of
discomfort to laborers who were dependent on their wages for P4,238.00. The COA found no sufficient justification to grant the
sustenance; and (2) that choosing Marilao as a safer destination, request for relief from accountability. We reversed the ruling and
being nearer, and in view of the comparative hazards in the trips to found that riding the LRT cannot per se be denounced as a
the two places, said decision seemed logical at that time. We negligent act more so because Cruzs mode of transit was
further held that the fact that two robbers attacked him in broad influenced by time and money considerations; that she boarded the
daylight in the jeep while it was on a busy highway and in the LRT to be able to arrive in Caloocan in time for her 3 pm meeting;
presence of other passengers could not be said to be a result of his that any prudent and rational person under similar circumstance
imprudence and negligence. can reasonably be expected to do the same; that possession of a
Unlike in Hernandez where the robbery happened in a public cellphone should not hinder one from boarding the LRT coach as
utility, the robbery in this case took place in the pawnshop which Cruz did considering that whether she rode a jeep or bus, the risk
is under the control of petitioners. Petitioners had the means to of theft would have also been present; that because of her relatively
screen the persons who were allowed entrance to the premises and low position and pay, she was not expected to have her own vehicle
to protect itself from unlawful intrusion. Petitioners had failed to or to ride a taxicab; she did not have a government assigned
exercise precautionary measures in ensuring that the robbers were vehicle; that placing the cellphone in a bag away from covetous
prevented from entering the pawnshop and for keeping the vault eyes and holding on to that bag as she did is ordinarily sufficient
open for the day, which paved the way for the robbers to easily cart care of a cellphone while traveling on board the LRT; that the
away the pawned articles.

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records did not show any specific act of negligence on her part and
negligence can never be presumed.
Unlike in the Cruz case, the robbery in this case happened in
petitioners' pawnshop and they were negligent in not exercising the
precautions justly demanded of a pawnshop.
WHEREFORE, except for the insurance aspect, the Decision of the
Court of Appeals dated March 31, 2003 and its Resolution dated
August 8, 2003, are AFFIRMED.
Costs against petitioners.
SO ORDERED.

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Republic of the Philippines sitting at the front seat was thrown out of the
SUPREME COURT vehicle. Upon landing on the ground, the plaintiff
Manila momentarily lost consciousness. When he came to
FIRST DIVISION his senses, he found that he had a lacerated wound
G.R. No. L-45637 May 31, 1985 on his right palm. Aside from this, he suffered
ROBERTO JUNTILLA, petitioner, injuries on his left arm, right thigh and on his back.
vs. (Exh. "D"). Because of his shock and injuries, he
CLEMENTE FONTANAR, FERNANDO BANZON and BERFOL went back to Danao City but on the way, he
CAMORO, respondents. discovered that his "Omega" wrist watch was lost.
Valentin A. Zozobrado for petitioner. Upon his arrival in Danao City, he immediately
Ruperto N. Alfarara for respondents. entered the Danao City Hospital to attend to his
injuries, and also requested his father-in-law to
GUTIERREZ, JR., J.: proceed immediately to the place of the accident and
This is a petition for review, on questions of law, of the decision of look for the watch. In spite of the efforts of his
the Court of First Instance of Cebu which reversed the decision of father-in-law, the wrist watch, which he bought for
the City Court of Cebu and exonerated the respondents from any P 852.70 (Exh. "B") could no longer be found.
liability arising from a vehicular accident. xxx xxx xxx
The background facts which led to the filing of a complaint for Petitioner Roberto Juntilla filed Civil Case No. R-17378 for breach
breach of contract and damages against the respondents are of contract with damages before the City Court of Cebu City,
summarized by the Court of First Instance of Cebu as follows: Branch I against Clemente Fontanar, Fernando Banzon and Berfol
The facts established after trial show that the Camoro.
plaintiff was a passenger of the public utility jeepney The respondents filed their answer, alleging inter alia that the
bearing plate No. PUJ-71-7 on the course of the trip accident that caused losses to the petitioner was beyond the
from Danao City to Cebu City. The jeepney was control of the respondents taking into account that the tire that
driven by defendant Berfol Camoro. It was registered exploded was newly bought and was only slightly used at the time
under the franchise of defendant Clemente Fontanar it blew up.
but was actually owned by defendant Fernando After trial, Judge Romulo R. Senining of the Civil Court of Cebu
Banzon. When the jeepney reached Mandaue City, rendered judgment in favor of the petitioner and against the
the right rear tire exploded causing the vehicle to respondents. The dispositive portion of the decision reads:
turn turtle. In the process, the plaintiff who was

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WHEREFORE, judgment is hereby rendered in favor the doctrine laid down by the Honorable Supreme
of the plaintiff and against the defendants and the Court in the case of Necesito et al. v. Paras, et al.
latter are hereby ordered, jointly and severally, to We find the petition impressed with merit.
pay the plaintiff the sum of P750.00 as The City Court and the Court of First Instance of Cebu found that
reimbursement for the lost Omega wrist watch, the the right rear tire of the passenger jeepney in which the petitioner
sum of P246.64 as unrealized salary of the plaintiff was riding blew up causing the vehicle to fall on its side. The
from his employer, the further sum of P100.00 for petitioner questions the conclusion of the respondent court drawn
the doctor's fees and medicine, an additional sum of from this finding of fact.
P300.00 for attorney's fees and the costs. The Court of First Instance of Cebu erred when it absolved the
The respondents appealed to the Court of First Instance of Cebu, carrier from any liability upon a finding that the tire blow out is a
Branch XIV. fortuitous event. The Court of First Instance of Cebu ruled that:
Judge Leonardo B. Canares reversed the judgment of the City After reviewing the records of the case, this Court
Court of Cebu upon a finding that the accident in question was finds that the accident in question was due to a
due to a fortuitous event. The dispositive portion of the decision fortuitous event. A tire blow-out, such as what
reads: happened in the case at bar, is an inevitable
WHEREFORE, judgment is hereby rendered accident that exempts the carrier from liability,
exonerating the defendants from any liability to the there being absence of a showing that there was
plaintiff without pronouncement as to costs. misconduct or negligence on the part of the operator
A motion for reconsideration was denied by the Court of First in the operation and maintenance of the vehicle
Instance. involved. The fact that the right rear tire exploded,
The petitioner raises the following alleged errors committed by the despite being brand new, constitutes a clear case of
Court of First Instance of Cebu on appeal caso fortuito which can be a proper basis for
a. The Honorable Court below committed grave exonerating the defendants from liability. ...
abuse of discretion in failing to take cognizance of The Court of First Instance relied on the ruling of the Court of
the fact that defendants and/or their employee Appeals in Rodriguez v. Red Line Transportation Co., CA G.R. No.
failed to exercise "utmost and/or extraordinary 8136, December 29, 1954, where the Court of Appeals ruled that:
diligence" required of common carriers contemplated A tire blow-out does not constitute negligence unless
under Art. 1755 of the Civil Code of the Philippines. the tire was already old and should not have been
b. The Honorable Court below committed grave used at all. Indeed, this would be a clear case of
abuse of discretion by deciding the case contrary to fortuitous event.

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The foregoing conclusions of the Court of First Instance of Cebu petitioner stated that there were three (3) passengers in the front
are based on a misapprehension of overall facts from which a seat and fourteen (14) passengers in the rear.
conclusion should be drawn. The reliance of the Court of First While it may be true that the tire that blew-up was still good
Instance on the Rodriguez case is not in order. In La Mallorca and because the grooves of the tire were still visible, this fact alone does
Pampanga Bus Co. v. De Jesus, et al. (17 SCRA 23), we held that: not make the explosion of the tire a fortuitous event. No evidence
Petitioner maintains that a tire blow-out is a was presented to show that the accident was due to adverse road
fortuitous event and gives rise to no liability for conditions or that precautions were taken by the jeepney driver to
negligence, citing the rulings of the Court of Appeals compensate for any conditions liable to cause accidents. The
in Rodriguez v. Red Line Transportation Co., CA sudden blowing-up, therefore, could have been caused by too
G.R. No. 8136, December 29, 1954, and People v. much air pressure injected into the tire coupled by the fact that the
Palapad, CA-G.R. No. 18480, June 27, 1958. These jeepney was overloaded and speeding at the time of the accident.
rulings, however, not only are not binding on this In Lasam v. Smith (45 Phil. 657), we laid down the following
Court but were based on considerations quite essential characteristics of caso fortuito:
different from those that obtain in the case at bar. xxx xxx xxx
The appellate court there made no findings of any ... In a legal sense and, consequently, also in
specific acts of negligence on the part of the relation to contracts, a caso fortuito presents the
defendants and confined itself to the question of following essential characteristics: (1) The cause of
whether or not a tire blow-out, by itself alone and the unforeseen and unexpected occurrence, or of the
without a showing as to the causative factors, would failure of the debtor to comply with his obligation,
generate liability. ... must be independent of the human will. (2) It must
In the case at bar, there are specific acts of negligence on the part be impossible to foresee the event which constitutes
of the respondents. The records show that the passenger jeepney the caso fortuito, or if it can be foreseen, it must be
turned turtle and jumped into a ditch immediately after its right impossible to avoid. (3) The occurrence must be
rear tire exploded. The evidence shows that the passenger jeepney such as to render it impossible for the debtor to
was running at a very fast speed before the accident. We agree with fulfill his obligation in a normal manner. And (4) the
the observation of the petitioner that a public utility jeep running obligor (debtor) must be free from any participation
at a regular and safe speed will not jump into a ditch when its right in the aggravation of the injury resulting to the
rear tire blows up. There is also evidence to show that the creditor. (5 Encyclopedia Juridica Espanola, 309.)
passenger jeepney was overloaded at the time of the accident. The In the case at bar, the cause of the unforeseen and unexpected
occurrence was not independent of the human will. The accident

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was caused either through the negligence of the driver or because privity whatever with the manufacturer or vendor of
of mechanical defects in the tire. Common carriers should teach the defective equipment, the passenger has no
their drivers not to overload their vehicles, not to exceed safe and remedy against him, while the carrier usually has. It
legal speed limits, and to know the correct measures to take when is but logical, therefore, that the carrier, while not
a tire blows up thus insuring the safety of passengers at all times. an insurer of the safety of his passengers, should
Relative to the contingency of mechanical defects, we held in nevertheless be held to answer for the flaws of his
Necesito, et al. v. Paras, et al. (104 Phil. 75), that: equipment if such flaws were at all discoverable. ...
... The preponderance of authority is in favor of the It is sufficient to reiterate that the source of a common carrier's
doctrine that a passenger is entitled to recover legal liability is the contract of carriage, and by entering into the
damages from a carrier for an injury resulting from said contract, it binds itself to carry the passengers safely as far as
a defect in an appliance purchased from a human care and foresight can provide, using the utmost diligence
manufacturer, whenever it appears that the defect of a very cautious person, with a due regard for all the
would have been discovered by the carrier if it had circumstances. The records show that this obligation was not met
exercised the degree of care which under the by the respondents.
circumstances was incumbent upon it, with regard The respondents likewise argue that the petitioner cannot recover
to inspection and application of the necessary tests. any amount for failure to prove such damages during the trial. The
For the purposes of this doctrine, the manufacturer respondents submit that if the petitioner was really injured, why
is considered as being in law the agent or servant of was he treated in Danao City and not in Mandaue City where the
the carrier, as far as regards the work of accident took place. The respondents argue that the doctor who
constructing the appliance. According to this theory, issued the medical certificate was not presented during the trial,
the good repute of the manufacturer will not relieve and hence not cross-examined. The respondents also claim that
the carrier from liability' (10 Am. Jur. 205, s, 1324; the petitioner was not wearing any wrist watch during the accident.
see also Pennsylvania R. Co. v. Roy, 102 U.S. 451; It should be noted that the City Court of Cebu found that the
20 L. Ed. 141; Southern R. Co. v. Hussey, 74 ALR petitioner had a lacerated wound on his right palm aside from
1172; 42 Fed. 2d 70; and Ed Note, 29 ALR 788.: injuries on his left arm, right thigh and on his back, and that on
Ann. Cas. 1916E 929). his way back to Danao City, he discovered that his "Omega" wrist
The rationale of the carrier's liability is the fact that watch was lost. These are findings of facts of the City Court of
the passenger has neither choice nor control over Cebu which we find no reason to disturb. More so when we
the carrier in the selection and use of the equipment consider the fact that the Court of First Instance of Cebu impliedly
and appliances in use by the carrier. Having no

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concurred in these matters when it confined itself to the question
of whether or not the tire blow out was a fortuitous event.
WHEREFORE, the decision of the Court of First Instance of Cebu,
Branch IV appealed from is hereby REVERSED and SET ASIDE,
and the decision of the City Court of Cebu, Branch I is
REINSTATED, with the modification that the damages shall earn
interest at 12% per annum and the attorney's fees are increased to
SIX HUNDRED PESOS (P600.00). Damages shall earn interests
from January 27, 1975.
SO ORDERED.

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Republic of the Philippines official, Engr. Jesus L. Reyna. Pertinent aspects of the latter's
SUPREME COURT Report 5 dated October 18, 1989 stated, as follows:
Manila 5. One of the factors that may have led to this
THIRD DIVISION calamitous event is the formation of the building in
the area and the general direction of the wind.
G.R. No. 126389 July 10, 1998 Situated in the peripheral lot is an almost U-shaped
SOUTHEASTERN COLLEGE INC., petitioner, formation of 4-storey building. Thus, with the strong
vs. winds having a westerly direction, the general
COURT OF APPEALS, JUANITA DE JESUS VDA. DE DIMAANO, formation of the building becomes a big funnel-like
EMERITA DIMAANO, REMEDIOS DIMAANO, CONSOLACION structure, the one situated along College Road,
DIMAANO and MILAGROS DIMAANO, respondents. receiving the heaviest impact of the strong winds.
Hence, there are portions of the roofing, those
PURISIMA, J.: located on both ends of the building, which
Petition for review under Rule 45 of the Rules of Court seeking to remained intact after the storm.
set aside the Decision 1 promulgated on July 31, 1996, and 6. Another factor and perhaps the most likely reason
Resolution 2 dated September 12, 1996 of the Court of Appeals 3 in for the dislodging of the roofing structural trusses is
CA-G.R. No. 41422, entitled "Juanita de Jesus vda. de Dimaano, et the improper anchorage of the said trusses to the
al. vs. Southeastern College, Inc.", which reduced the moral roof beams. The 1/2' diameter steel bars embedded
damages awarded below from P1,000,000.00 to P200,000.00. 4 The on the concrete roof beams which serve as truss
Resolution under attack denied petitioner's motion for anchorage are not bolted nor nailed to the trusses.
reconsideration. Still, there are other steel bars which were not even
Private respondents are owners of a house at 326 College Road, bent to the trusses, thus, those trusses are not
Pasay City, while petitioner owns a four-storey school building anchored at all to the roof beams.
along the same College Road. On October 11, 1989, at about 6:30 It then recommended that "to avoid any further loss and
in the morning, a powerful typhoon "Saling" hit Metro Manila. damage to lives, limbs and property of persons living in the
Buffeted by very strong winds, the roof of petitioner's building was vicinity," the fourth floor of subject school building be
partly ripped off and blown away, landing on and destroying declared as a "structural hazard."
portions of the roofing of private respondents' house. After the In their Complaint 6 before the Regional Trial Court of Pasay City,
typhoon had passed, an ocular inspection of the destroyed building Branch 117, for damages based on culpa aquiliana, private
was conducted by a team of engineers headed by the city building respondents alleged that the damage to their house rendered the

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same uninhabitable, forcing them to stay temporarily in others' c) P100,000.00 as
houses. And so they sought to recover from petitioner P117,116.00, attorney's fees;
as actual damages, P1,000,000.00, as moral damages, d) Costs of the instant
P300,000.00, as exemplary damages and P100,000.00, for and as suit.
attorney's fees; plus costs. The claim for exemplary damages is denied for the
In its Answer, petitioner averred that subject school building had reason that the defendants (sic) did in a wanton
withstood several devastating typhoons and other calamities in the fraudulent, reckless, oppressive or malevolent
past, without its roofing or any portion thereof giving way; that it manner.
has not been remiss in its responsibility to see to it that said school In its appeal to the Court of Appeals, petitioner assigned as errors,
building, which houses school children, faculty members, and 8 that:

employees, is "in tip-top condition"; and furthermore, typhoon I


"Saling" was "an act of God and therefore beyond human control" THE TRIAL COURT ERRED IN HOLDING THAT
such that petitioner cannot be answerable for the damages TYPHOON "SALING", AS AN ACT OF GOD, IS NOT
wrought thereby, absent any negligence on its part. "THE SOLE AND ABSOLUTE REASON" FOR THE
The trial court, giving credence to the ocular inspection report to RIPPING-OFF OF THE SMALL PORTION OF THE
the effect that subject school building had a "defective roofing ROOF OF SOUTHEASTERN'S FOUR (4) STOREY
structure," found that, while typhoon "Saling" was accompanied by SCHOOL BUILDING.
strong winds, the damage to private respondents' houses "could II
have been avoided if the construction of the roof of [petitioner's] THE TRIAL COURT ERRED IN HOLDING THAT "THE
building was not faulty." The dispositive portion of the lower court's CONSTRUCTION OF THE ROOF OF DEFENDANT'S
decision 7 reads, thus: SCHOOL BUILDING WAS FAULTY"
WHEREFORE, in view of the foregoing, the Court NOTWITHSTANDING THE ADMISSION THAT
renders judgment (sic) in favor of the plaintiff (sic) THERE WERE TYPHOONS BEFORE BUT NOT AS
and against the defendants, (sic) ordering the latter GRAVE AS TYPHOON "SALING" WHICH IS THE
to pay jointly and severally the former as follows: DIRECT AND PROXIMATE CAUSE OF THE
a) P117,116.00, as INCIDENT.
actual damages, plus III
litigation expenses; THE TRIAL COURT ERRED IN AWARDING ACTUAL
b) P1,000,000.00 as AND MORAL DAMAGES AS WELL AS ATTORNEY'S
moral damages; FEES AND LITIGATION EXPENSES AND COSTS OF

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SUIT TO DIMAANOS WHEN THEY HAVE NOT 4. Whether or not the award of attorney's fees when
INCURRED ACTUAL DAMAGES AT ALL AS the case was already moot academic [sic] legally
DIMAANOS HAVE ALREADY SOLD THEIR justified.
PROPERTY, AN INTERVENING EVENT THAT 5. Whether or not petitioner is liable for damage
RENDERS THIS CASE MOOT AND ACADEMIC. caused to others by typhoon "Saling" being an act of
IV God.
THE TRIAL COURT ERRED IN ORDERING THE 6. Whether or not the issuance of a writ of execution
ISSUANCE OF THE WRIT OF EXECUTION INSPITE pending appeal, ex-parte or without hearing, has
OF THE PERFECTION OF SOUTHEASTERN'S support in law.
APPEAL WHEN THERE IS NO COMPELLING The pivot of inquiry here, determinative of the other issues, is
REASON FOR THE ISSUANCE THERETO. whether the damage on the roof of the building of private
As mentioned earlier, respondent Court of Appeals affirmed with respondents resulting from the impact of the falling portions of the
modification the trial court's disposition by reducing the award of school building's roof ripped off by the strong winds of typhoon
moral damages from P1,000,000.00 to P200,000.00. Hence, "Saling", was, within legal contemplation, due to fortuitous event?
petitioner's resort to this Court, raising for resolution the issues of: If so, petitioner cannot be held liable for the damages suffered by
1. Whether or not the award of actual damages [sic] the private respondents. This conclusion finds support in Article
to respondent Dimaanos on the basis of speculation 1174 of Civil Code, which provides:
or conjecture, without proof or receipts of actual Art 1174. Except in cases expressly specified by the
damage, [sic] legally feasible or justified. law, or when it is otherwise declared by stipulation,
2. Whether or not the award of moral damages to or when the nature of the obligation requires the
respondent Dimaanos, with the latter having assumption of risk, no person shall be responsible
suffered, actual damage has legal basis. for those events which could not be foreseen, or
3. Whether or not respondent Dimaanos who are no which, though foreseen, were inevitable.
longer the owner of the property, subject matter of The antecedent of fortuitous event or caso fortuito is found in the
the case, during its pendency, has the right to Partidas which defines it as "an event which takes place by
pursue their complaint against petitioner when the accident and could not have been foreseen." 9 Escriche elaborates
case was already moot and academic by the sale of it as "an unexpected event or act of God which could neither be
the property to third party. foreseen nor resisted." 10 Civilist Arturo M. Tolentino adds that
"[f]ortuitous events may be produced by two general causes: (1) by
nature, such as earthquakes, storms, floods, epidemics, fires, etc.

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and (2) by the act of man, such as an armed invasion, attack by There is no question that a typhoon or storm is a fortuitous event,
bandits, governmental prohibitions, robbery, etc." 11 a natural occurrence which may be foreseen but is unavoidable
In order that a fortuitous event may exempt a person from liability, despite any amount of foresight, diligence or care. 15 In order to be
it is necessary that he be free from any previous negligence or exempt from liability arising from any adverse consequence
misconduct by reason of which the loss may have been occasioned. engendered thereby, there should have been no human
12 An act of God cannot be invoked for the protection of a person participation amounting to a negligent act. 16 In other words; the
who has been guilty of gross negligence in not trying to forestall its person seeking exoneration from liability must not be guilty of
possible adverse consequences. When a person's negligence negligence. Negligence, as commonly understood, is conduct which
concurs with an act of God in producing damage or injury to naturally or reasonably creates undue risk or harm to others. It
another, such person is not exempt from liability by showing that may be the failure to observe that degree of care, precaution, and
the immediate or proximate cause of the damages or injury was a vigilance which the circumstances justify demand, 17 or the
fortuitous event. When the effect is found to be partly the result of omission to do something which a prudent and reasonable man,
the participation of man whether it be from active intervention, guided by considerations which ordinarily regulate the conduct of
or neglect, or failure to act the whole occurrence is hereby human affairs, would
humanized, and removed from the rules applicable to acts of God. do. 18 From these premises, we proceed to determine whether
13 petitioner was negligent, such that if it were not, the damage
In the case under consideration, the lower court accorded full caused to private respondents' house could have been avoided?
credence to the finding of the investigating team that subject At the outset, it bears emphasizing that a person claiming damages
school building's roofing had "no sufficient anchorage to hold it in for the negligence of another has the burden of proving the
position especially when battered by strong winds." Based on such existence of fault or negligence causative of his injury or loss. The
finding, the trial court imputed negligence to petitioner and facts constitutive of negligence must be affirmatively established by
adjudged it liable for damages to private respondents. competent evidence, 19 not merely by presumptions and
After a thorough study and evaluation of the evidence on record, conclusions without basis in fact. Private respondents, in
this Court believes otherwise, notwithstanding the general rule that establishing the culpability of petitioner, merely relied on the
factual findings by the trail court, especially when affirmed by the aforementioned report submitted by a team which made an ocular
appellate court, are binding and conclusive upon this Court. 14 inspection of petitioner's school building after the typhoon. As the
After a careful scrutiny of the records and the pleadings submitted term imparts, an ocular inspection is one by means of actual sight
by the parties, we find exception to this rule and hold that the or viewing. 20 What is visual to the eye through, is not always
lower courts misappreciated the evidence proffered. reflective of the real cause behind. For instance, one who hears a
gunshot and then sees a wounded person, cannot always definitely

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conclude that a third person shot the victim. It could have been unqualified imprimatur, the city building official is presumed to
self-inflicted or caused accidentally by a stray bullet. The have properly performed his duties 23 in connection therewith.
relationship of cause and effect must be clearly shown. In addition, petitioner presented its vice president for finance and
In the present case, other than the said ocular inspection, no administration who testified that an annual maintenance
investigation was conducted to determine the real cause of the inspection and repair of subject school building were regularly
partial unroofing of petitioner's school building. Private undertaken. Petitioner was even willing to present its maintenance
respondents did not even show that the plans, specifications and supervisor to attest to the extent of such regular inspection but
design of said school building were deficient and defective. Neither private respondents agreed to dispense with his testimony and
did they prove any substantial deviation from the approved plans simply stipulated that it would be corroborative of the vice
and specifications. Nor did they conclusively establish that the president's narration.
construction of such building was basically flawed. 21 Moreover, the city building official, who has been in the city
On the other hand, petitioner elicited from one of the witnesses of government service since 1974, admitted in open court that no
private respondents, city building official Jesus Reyna, that the complaint regarding any defect on the same structure has ever
original plans and design of petitioner's school building were been lodged before his office prior to the institution of the case at
approved prior to its construction. Engr. Reyna admitted that it bench. It is a matter of judicial notice that typhoons are common
was a legal requirement before the construction of any building to occurrences in this country. If subject school building's roofing was
obtain a permit from the city building official (city engineer, prior to not firmly anchored to its trusses, obviously, it could not have
the passage of the Building Act of 1977). In like manner, after withstood long years and several typhoons even stronger than
construction of the building, a certification must be secured from "Saling."
the same official attesting to the readiness for occupancy of the In light of the foregoing, we find no clear and convincing evidence
edifice. Having obtained both building permit and certificate of to sustain the judgment of the appellate court. We thus hold that
occupancy, these are, at the very least, prima facie evidence of the petitioner has not been shown negligent or at fault regarding the
regular and proper construction of subject school building. 22 construction and maintenance of its school building in question
Furthermore, when part of its roof needed repairs of the damage and that typhoon "Saling" was the proximate cause of the damage
inflicted by typhoon "Saling", the same city official gave the go- suffered by private respondents' house.
signal for such repairs without any deviation from the original With this disposition on the pivotal issue, private respondents'
design and subsequently, authorized the use of the entire fourth claim for actual and moral damages as well as attorney's fees must
floor of the same building. These only prove that subject building fail. 24 Petitioner cannot be made to answer for a purely fortuitous
suffers from no structural defect, contrary to the report that its "U- event. 25 More so because no bad faith or willful act to cause
shaped" form was "structurally defective." Having given his damage was alleged and proven to warrant moral damages.

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Private respondents failed to adduce adequate and competent proof
of the pecuniary loss they actually incurred. 26 It is not enough
that the damage be capable of proof but must be actually proved
with a reasonable degree of certainty, pointing out specific facts
that afford a basis for measuring whatever compensatory damages
are borne. 27 Private respondents merely submitted an estimated
amount needed for the repair of the roof their subject building.
What is more, whether the "necessary repairs" were caused ONLY
by petitioner's alleged negligence in the maintenance of its school
building, or included the ordinary wear and tear of the house itself,
is an essential question that remains indeterminable.
The Court deems unnecessary to resolve the other issues posed by
petitioner.
As regards the sixth issue, however, the writ of execution issued on
April 1, 1993 by the trial court is hereby nullified and set aside.
Private respondents are ordered to reimburse any amount or
return to petitioner any property which they may have received by
virtue of the enforcement of said writ.
WHEREFORE, the petition is GRANTED and the challenged
Decision is REVERSED. The complaint of private respondents in
Civil Case No. 7314 before the trial court a quo is ordered
DISMISSED and the writ of execution issued on April 1, 1993 in
said case is SET ASIDE. Accordingly, private respondents are
ORDERED to return to petitioner any amount or property received
by them by virtue of said writ. Costs against the private
respondents.
SO ORDERED.

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Republic of the Philippines This liability shall cease only in case, the damage should
SUPREME COURT arise from force majeure or from the fault of the person who
Manila may have suffered it.
EN BANC The question presented is whether the owner of the animal is liable
G.R. No. L-2075 November 29, 1949 when damage is caused to its caretaker.
MARGARITA AFIALDA, plaintiff-appellant, The lower court took the view that under the above-quoted
vs. provision of the Civil Code, the owner of an animal is answerable
BASILIO HISOLE and FRANCISCO HISOLE, defendants- only for damages caused to a stranger, and that for damage caused
appellees. to the caretaker of the animal the owner would be liable only if he
Nicolas P. Nonato for appellant. had been negligent or at fault under article 1902 of the same code.
Gellada, Mirasol and Ravena for appellees. Claiming that the lower court was in error, counsel for plaintiff
REYES, J.: contends that the article 1905 does not distinguish between
This is an action for damages arising from injury caused by an damage caused to the caretaker and makes the owner liable
animal. The complaint alleges that the now deceased, Loreto whether or not he has been negligent or at fault. For authority
Afialda, was employed by the defendant spouses as caretaker of counsel cites the following opinion which Manresa quotes from a
their carabaos at a fixed compensation; that while tending the decision of the Spanish Supreme Court:
animals he was, on March 21, 1947, gored by one of them and El articulo 1905 del codigo Civil no consienta otra
later died as a consequence of his injuries; that the mishap was interpretacion que la que, clara y evidentemente, se deriva
due neither to his own fault nor to force majeure; and that plaintiff de sus terminos literales, bastando, segun el mismo, que
is his elder sister and heir depending upon him for support. un animal cause perjuicio para que nasca la
Before filing their answer, defendants moved for the dismissal of responsibilidad del dueno, aun no imputandose a este
the complaint for lack of a cause of action, and the motion having ninguna clase de culpa o negligencia, habida,sin duda,
been granted by the lower court, plaintiff has taken this appeal. cuenta por el lgislador de que tal concepto de dueno es
Plaintiff seeks to hold defendants liable under article 1905 of the suficiente para que arrastre las consecuencias favorables o
Civil Code, which reads: adversas de esta clase de propiedad, salvo la exception en el
The possessor of an animal, or the one who uses the same, mismo contenida. (12 Manresa, Commentaries on the
is liable for any damages it may cause, even if such animal Spanish CivilCode, 573.)
should escape from him or stray away. This opinion, however, appears to have been rendered in a case
where an animal caused injury to a stranger or third person. It is
therefore no authority for a case like the present where the person

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injured was the caretaker of the animal. The distinction is There being no reversible error in the order appealed from, the
important. For the statute names the possessor or user of the same is hereby affirmed, but without costs in view of the financial
animal as the person liable for "any damages it may cause," and situation of the appellant.
this for the obvious reason that the possessor or user has the
custody and control of the animal and is therefore the one in a
position to prevent it from causing damage.
In the present case, the animal was in custody and under the
control of the caretaker, who was paid for his work as such.
Obviously, it was the caretaker's business to try to prevent the
animal from causing injury or damage to anyone, including
himself. And being injured by the animal under those
circumstances, was one of the risks of the occupation which he
had voluntarily assumed and for which he must take the
consequences.
In a decision of the Spanish Supreme Court, cited by Manresa in
his Commentaries (Vol. 12, p. 578), the death of an employee who
was bitten by a feline which his master had asked him to take to
his establishment was by said tribunal declared to be "a veritable
accident of labor" which should come under the labor laws rather
than under article 1905 of the Civil Code. The present action,
however, is not brought under the Workmen's Compensation Act,
there being no allegation that, among other things, defendant's
business, whatever that might be, had a gross income of P20,000.
As already stated, defendant's liability is made to rest on article
1905 of the Civil Code. but action under that article is not tenable
for the reasons already stated. On the other hand, if action is to be
based on article 1902 of the Civil Code, it is essential that there be
fault or negligence on the part of the defendants as owners of the
animal that caused the damage. But the complaint contains no
allegation on those points.

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Republic of the Philippines From the evidence of plaintiffs it appears that in the
SUPREME COURT evening of June 28 until the early morning of June
Manila 29, 1967 a strong typhoon by the code name
SECOND DIVISION "Gening" buffeted the province of Ilocos Norte,
G.R. No. L-53401 November 6, 1989 bringing heavy rains and consequent flooding in its
THE ILOCOS NORTE ELECTRIC COMPANY, petitioner, wake. Between 5:30 and 6:00 A.M. on June 29,
vs. 1967, after the typhoon had abated and when the
HONORABLE COURT OF APPEALS, (First Division) LILIAN floodwaters were beginning to recede the deceased
JUAN LUIS, JANE JUAN YABES, VIRGINIA JUAN CID, GLORIA Isabel Lao Juan, fondly called Nana Belen, ventured
JUAN CARAG, and PURISIMA JUAN, respondents. out of the house of her son-in-law, Antonio Yabes,
Herman D. Coloma for petitioner. on No. 19 Guerrero Street, Laoag City, and
Glicerio S. Ferrer for private respondents. proceeded northward towards the direction of the
Five Sisters Emporium, of which she was the owner
PARAS, J.: and proprietress, to look after the merchandise
Sought to be reversed in this petition is the Decision * of the therein that might have been damaged. Wading in
respondent Court of Appeals' First Division, setting aside the waist-deep flood on Guerrero, the deceased was
judgment of the then Court of First Instance (CFI) of Ilocos Norte, followed by Aida Bulong, a Salesgirl at the Five
with the following dispositive portion: Sisters Grocery, also owned by the deceased, and by
WHEREFORE, the appealed judgment is hereby set Linda Alonzo Estavillo, a ticket seller at the YJ
aside and another rendered in its stead whereby Cinema, which was partly owned by the deceased.
defendant is hereby sentenced to pay plaintiffs Aida and Linda walked side by side at a distance of
actual damages of P30,229.45; compensatory between 5 and 6 meters behind the deceased,
damages of P50,000.00; exemplary damages of Suddenly, the deceased screamed "Ay" and quickly
P10,000.00; attorney's fees of P3,000.00; plus the sank into the water. The two girls attempted to help,
costs of suit in both instances. (p. 27 Rollo) but fear dissuaded them from doing so because on
Basically, this case involves a clash of evidence whereby both the spot where the deceased sank they saw an
patties strive for the recognition of their respective versions of the electric wire dangling from a post and moving in
scenario from which the disputed claims originate. The respondent snake-like fashion in the water. Upon their shouts
Court of Appeals (CA) summarized the evidence of the parties as for help, Ernesto dela Cruz came out of the house of
follows: Antonio Yabes. Ernesto tried to go to the deceased,

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but at four meters away from her he turned back lineman, he decided to go to the INELCO Office at
shouting that the water was grounded. Aida and the Life Theatre on Rizal Street by way of Guerrero.
Linda prodded Ernesto to seek help from Antonio As he turned right at the intersection of Guerrero
Yabes at the YJ Cinema building which was four or and Rizal, he saw an electric wire about 30 meters
five blocks away. long strung across the street "and the other end was
When Antonio Yabes was informed by Ernesto that seeming to play with the current of the water." (p.
his mother-in law had been electrocuted, he acted 64, TSN, Oct. 24, 1972) Finding the Office of the
immediately. With his wife Jane, together with INELCO still closed, and seeing no lineman therein,
Ernesto and one Joe Ros, Yabes passed by the City he returned to the NPC Compound.
Hall of Laoag to request the police to ask the people At about 8:10 A.M., Engr. Juan went out of the
of defendant Ilocos Norte Electric Company or compound again on another inspection trip. Having
INELCO to cut off the electric current. Then the learned of the death of Isabel Lao Juan, he passed
party waded to the house on Guerrero Street. The by the house of the deceased at the corner of
floodwater was receding and the lights inside the Guerrero and M.H. del Pilar streets to which the
house were out indicating that the electric current body had been taken. Using the resuscitator which
had been cut off in Guerrero. Yabes instructed his was a standard equipment in his jeep and employing
boys to fish for the body of the deceased. The body the skill he acquired from an in service training on
was recovered about two meters from an electric resuscitation, he tried to revive the deceased. His
post. efforts proved futile. Rigor mortis was setting in. On
In another place, at about 4:00 A.M. on that fateful the left palm of the deceased, Engr. Juan noticed a
date, June 29, 1967, Engineer Antonio Juan, Power hollow wound. Proceeding to the INELCO Office, he
Plant Engineer of the National Power Corporation at met two linemen on the way. He told them about the
the Laoag Diesel-Electric Plant, noticed certain grounded lines of the INELCO In the afternoon of the
fluctuations in their electric meter which indicated same day, he went on a third inspection trip
such abnormalities as grounded or short-circuited preparatory to the restoration of power. The
lines. Between 6:00 and 6:30 A.M., he set out of the dangling wire he saw on Guerrero early in the
Laoag NPC Compound on an inspection. On the morning of June 29, 1967 was no longer there.
way, he saw grounded and disconnected lines. Many people came to the house at the corner of
Electric lines were hanging from the posts to the Guerrero and M.H. del Pilar after learning that the
ground. Since he could not see any INELCO deceased had been electrocuted. Among the

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sympathizers was Dr. Jovencio Castro, Municipal supplying electric current to the public, defendant
Health Officer of Sarrat, Ilocos Norte. Upon the had installed safety devices to prevent and avoid
request of the relatives of the deceased, Dr. Castro injuries to persons and damage to property in case
examined the body at about 8:00 A.M. on June 29, of natural calamities such as floods, typhoons, fire
1967. The skin was grayish or, in medical parlance, and others. Defendant had 12 linesmen charged
cyanotic, which indicated death by electrocution. On with the duty of making a round-the-clock check-up
the left palm, the doctor found an "electrically of the areas respectively assigned to them.
charged wound" (Exh. C-1: p. 101, TSN, Nov. 28, Defendant asserts that although a strong typhoon
1972) or a first degree burn. About the base of the struck the province of Ilocos Norte on June 29,
thumb on the left hand was a burned wound. (Exh. 1967, putting to streets of Laoag City under water,
C-2, pp. 102-103, Ibid.) The certificate of death only a few known places in Laoag were reported to
prepared by Dr. Castro stated the cause of' death as have suffered damaged electric lines, namely, at the
,'circulatory shock electrocution" (Exh. I; p. 103, southern approach of the Marcos Bridge which was
Ibid.). washed away and where the INELCO lines and posts
In defense and exculpation, defendant presented the collapsed; in the eastern part near the residence of
testimonies of its officers and employees, namely, the late Governor Simeon Mandac; in the far north
Conrado Asis, electric engineer; Loreto Abijero, near the defendant's power plant at the corner of
collector-inspector; Fabico Abijero, lineman; and Segundo and Castro Streets, Laoag City and at the
Julio Agcaoili, president-manager of INELCO far northwest side, near the premises of the Ilocos
Through the testimonies of these witnesses, Norte National High School. Fabico Abijero, testified
defendant sought to prove that on and even before that in the early morning before 6 o'clock on June
June 29, 1967 the electric service system of the 29, 1967 he passed by the intersection of Rizal and
INELCO in the whole franchise area, including Area Guerrero Streets to switch off the street lights in
No. 9 which covered the residence of Antonio Yabes Area No. 9. He did not see any cut or broken wires
at No. 18 Guerrero Street, did not suffer from any in or near the vicinity. What he saw were many
defect that might constitute a hazard to life and people fishing out the body of Isabel Lao Juan.
property. The service lines, devices and other A witness in the person of Dr. Antonio Briones was
INELCO equipment in Area No. 9 had been newly- presented by the defense to show that the deceased
installed prior to the date in question. As a public could not have died of electrocution Substantially,
service operator and in line with its business of the testimony of the doctor is as follows: Without an

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autopsy on the cadaver of the victim, no doctor, not due trial, the CFI found the facts in favor of petitioner and
even a medicolegal expert, can speculate as to the dismissed the complaint but awarded to the latter P25,000 in
real cause of death. Cyanosis could not have been moral damages and attorney's fees of P45,000. An appeal was filed
found in the body of the deceased three hours after with the CA which issued the controverted decision.
her death, because cyanosis which means lack of In this petition for review the petitioner assigns the following errors
oxygen circulating in the blood and rendering the committed by the respondent CA:
color of the skin purplish, appears only in a live 1. The respondent Court of Appeals
person. The presence of the elongated burn in the committed grave abuse of discretion
left palm of the deceased (Exhibits C-1 and C-2) is and error in considering the purely
not sufficient to establish her death by hearsay alleged declarations of
electrocution; since burns caused by electricity are Ernesto de la Cruz as part of the res
more or less round in shape and with points of entry gestae.
and exit. Had the deceased held the lethal wire for a 2. The respondent Court of Appeals
long time, the laceration in her palm would have committed grave abuse of discretion
been bigger and the injury more massive. (CA and error in holding that the strong
Decision, pp. 18-21, Rollo) typhoon "Gening" which struck Laoag
An action for damages in the aggregate amount of P250,000 was City and Ilocos Norte on June 29,
instituted by the heirs of the deceased with the aforesaid CFI on 1967 and the flood and deluge it
June 24, 1968. In its Answer (Vide, Record on Appeal, p. 55, Rollo), brought in its wake were not
petitioner advanced the theory, as a special defense, that the fortuitous events and did not
deceased could have died simply either by drowning or by exonerate petitioner-company from
electrocution due to negligence attributable only to herself and not liability for the death of Isabel Lao
to petitioner. In this regard, it was pointed out that the deceased, Juan.
without petitioner's knowledge, caused the installation of a burglar 3. The respondent Court of Appeals
deterrent by connecting a wire from the main house to the iron gravely abused its discretion and
gate and fence of steel matting, thus, charging the latter with erred in not applying the legal
electric current whenever the switch is on. Petitioner then principle of "assumption of risk" in
conjectures that the switch to said burglar deterrent must have the present case to bar private
been left on, hence, causing the deceased's electrocution when she respondents from collecting damages
tried to open her gate that early morning of June 29, 1967. After from petitioner company.

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4. That the respondent Court of that the deceased had clutched a live wire of the petitioner. This
Appeals gravely erred and abused its was corroborated by the testimony of Dr. Jovencio Castro who
discretion in completely reversing the actually examined the body of the deceased a few hours after the
findings of fact of the trial court. death and described the said burnt wounds as a "first degree burn"
5. The findings of fact of the (p. 144, TSN, December 11, 1972) and that they were "electrically
respondent Court of Appeals are charged" (p. 102, TSN, November 28, 1972). Furthermore,
reversible under the recognized witnesses Linda Alonzo Estavillo and Aida Bulong added that after
exceptions. the deceased screamed "Ay" and sank into the water, they tried to
6. The trial court did not err in render some help but were overcome with fear by the sight of an
awarding moral damages and electric wire dangling from an electric post, moving in the water in
attorney's fees to defendant a snake-like fashion (supra). The foregoing therefore justifies the
corporation, now petitioner company. respondent CA in concluding that "(t)he nature of the wounds as
7. Assuming arguendo that petitioner described by the witnesses who saw them can lead to no other
company may be held liable from the conclusion than that they were "burns," and there was nothing else
death of the late Isabel Lao Juan, the in the street where the victim was wading thru which could cause a
damages granted by respondent burn except the dangling live wire of defendant company" (CA
Court of Appeals are improper and Decision, p. 22, Rollo).
exhorbitant. (Petitioners But in order to escape liability, petitioner ventures into the theory
Memorandum, p. 133, Rollo) that the deceased was electrocuted, if such was really the case
Basically, three main issues are apparent: (1) whether or not the when she tried to open her steel gate, which was electrically
deceased died of electrocution; (2) whether or not petitioner may be charged by an electric wire she herself caused to install to serve as
held liable for the deceased's death; and (3) whether or not the a burglar deterrent. Petitioner suggests that the switch to said
respondent CA's substitution of the trial court's factual findings for burglar alarm was left on. But this is mere speculation, not backed
its own was proper. up with evidence. As required by the Rules, "each party must prove
In considering the first issue, it is Our view that the same be his own affirmative allegations." (Rule 131, Sec. 1). Nevertheless,
resolved in the affirmative. By a preponderance of evidence, private the CA significantly noted that "during the trial, this theory was
respondents were able to show that the deceased died of abandoned" by the petitioner (CA Decision, p. 23, Rollo).
electrocution, a conclusion which can be primarily derived from the Furthermore the CA properly applied the principle of res gestae.
photographed burnt wounds (Exhibits "C", "C-1", "C-2") on the left The CA said:
palm of the former. Such wounds undoubtedly point to the fact

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Linda Alonzo Estavillo, a ticket seller, and Aida on the grounds of trustworthiness and necessity. "Trustworthiness"
Bulong, a salesgirl, were with the deceased during because the statements are made instinctively (Wesley vs. State, 53
that fateful morning of June 29, 1967. This Court Ala. 182), and "necessity" because such natural and spontaneous
has not been offered any sufficient reason to utterances are more convincing than the testimony of the same
discredit the testimonies of these two young ladies. person on the stand (Mobile vs. Ascraft 48 Ala. 31). Therefore, the
They were one in the affirmation that the deceased, fact that the declarant, Ernesto de la Cruz, was not presented to
while wading in the waist-deep flood on Guerrero testify does not make the testimony of Linda Alonzo Estavillo and
Street five or six meters ahead of them, suddenly Aida Bulong hearsay since the said declaration is part of the res
screamed "Ay" and quickly sank into the water. gestae. Similarly, We considered part of the res gestae a
When they approached the deceased to help, they conversation between two accused immediately after commission of
were stopped by the sight of an electric wire the crime as overheard by a prosecution witness (People vs. Reyes,
dangling from a post and moving in snake-like 82 Phil. 563).
fashion in the water. Ernesto dela Cruz also tried to While it may be true that, as petitioner argues (vide petitioner's
approach the deceased, but he turned back Memorandum, p. 135, Rollo), Ernesto de la Cruz was not an actual
shouting that the water was grounded. These bits of witness to the instant when the deceased sank into the waist-deep
evidence carry much weight. For the subject of the water, he acted upon the call of help of Aida Bulong and Linda
testimonies was a startling occurrence, and the Alonzo Estavillo with the knowledge of, and immediately after, the
declarations may be considered part of the res sinking of the deceased. In fact the startling event had not yet
gestae. (CA Decision, p. 21, Rollo) ceased when Ernesto de la Cruz entered the scene considering that
For the admission of the res gestae in evidence, the following the victim remained submerged. Under such a circumstance, it is
requisites must be present: (1) that the principal act, the res undeniable that a state of mind characterized by nervous
gestae, be a startling occurrence; (2) that the statements were excitement had been triggered in Ernesto de la Cruz's being as
made before the declarant had time to contrive or devise; (3) that anybody under the same contingency could have experienced. As
the statements made must concern the occurrence in question and such, We cannot honestly exclude his shouts that the water was
its immediately attending circumstances (People vs. Ner, 28 SCRA grounded from the res gestae just because he did not actually see
1151; People vs. Balbas, 122 SCRA 959). We do not find any abuse the sinking of the deceased nor hear her scream "Ay."
of discretion on the CA' part in view of the satisfaction of said Neither can We dismiss the said declaration as a mere opinion of
requisites in the case at bar. Ernesto de la Cruz. While We concede to the submission that the
The statements made relative to the startling occurrence are statement must be one of facts rather than opinion, We cannot
admitted in evidence precisely as an exception to the hearsay rule agree to the proposition that the one made by him was a mere

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opinion. On the contrary, his shout was a translation of an of petitioner's negligence that death took place. We subscribe to the
actuality as perceived by him through his sense of touch. conclusions of the respondent CA when it found:
Finally, We do not agree that the taking of Ernesto de la Cruz' On the issue whether or not the defendant incurred
testimony was suppressed by the private respondents, thus, is liability for the electrocution and consequent death
presumed to be adverse to them pursuant to Section 5(e), Rule of the late Isabel Lao Juan, defendant called to the
131. For the application of said Rule as against a party to a case, it witness-stand its electrical engineer, chief lineman,
is necessary that the evidence alleged to be suppressed is available and lineman to show exercise of extraordinary
only to said party (People vs. Tulale, L-7233, 18 May 1955, 97 Phil. diligence and to negate the charge of negligence. The
953). The presumption does not operate if the evidence in question witnesses testified in a general way about their
is equally available to both parties (StaplesHowe Printing Co. vs. duties and the measures which defendant usually
Bldg. and Loan Assn., 36 Phil. 421). It is clear from the records adopts to prevent hazards to life and limb. From
that petitioner could have called Ernesto de la Cruz to the witness these testimonies, the lower court found "that the
stand. This, precisely, was Linda Alonzo Estavillo's suggestion to electric lines and other equipment of defendant
petitioner's counsel when she testified on cross examination: corporation were properly maintained by a well-
Q. And that Erning de la Cruz, how far did trained team of lineman, technicians and engineers
he reach from the gate of the house? working around the clock to insure that these
A. Well, you can ask that matter from him sir equipments were in excellent condition at all times."
because he is here. (TSN, p. 30, 26 Sept. (P. 40, Record on Appeal) The finding of the lower
1972) court, however, was based on what the defendant's
The foregoing shows that petitioner had the opportunity to verify employees were supposed to do, not on what they
the declarations of Ernesto de la Cruz which, if truly adverse to actually did or failed to do on the date in question,
private respondent, would have helped its case. However, due to and not on the occasion of the emergency situation
reasons known only to petitioner, the opportunity was not taken. brought about by the typhoon.
Coming now to the second issue, We tip the scales in the private The lower court made a mistake in assuming that
respondents' favor. The respondent CA acted correctly in disposing defendant's employees worked around the clock
the argument that petitioner be exonerated from liability since during the occurrence of the typhoon on the night of
typhoons and floods are fortuitous events. While it is true that June 28 and until the early morning of June 29,
typhoons and floods are considered Acts of God for which no 1967, Engr. Antonio Juan of the National Power
person may be held responsible, it was not said eventuality which Corporation affirmed that when he first set out on
directly caused the victim's death. It was through the intervention an inspection trip between 6:00 and 6:30 A.M. on

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June 29, 1967, he saw grounded and disconnected he had taken his family for refuge. (pp. 510-511,
electric lines of the defendant but he saw no INELCO Ibid.)
lineman. The INELCO Office at the Life theatre on In times of calamities such as the one which
Rizal Street was still closed. (pp. 63-64, TSN, Oct. occurred in Laoag City on the night of June 28 until
24, 1972) Even the witnesses of defendant the early hours of June 29, 1967, extraordinary
contradict the finding of the lower court. Conrado diligence requires a supplier of electricity to be in
Asis, defendant's electrical engineer, testified that he constant vigil to prevent or avoid any probable
conducted a general inspection of the franchise area incident that might imperil life or limb. The evidence
of the INELCO only on June 30, 1967, the day does not show that defendant did that. On the
following the typhoon. The reason he gave for the contrary, evidence discloses that there were no men
delay was that all their vehicles were submerged. (p. (linemen or otherwise) policing the area, nor even
337, TSN, July 20, 1973) According to Asis, he manning its office. (CA Decision, pp. 24-25, Rollo)
arrived at his office at 8:00 A.M. on June 30 and Indeed, under the circumstances of the case, petitioner was
after briefing his men on what to do they started negligent in seeing to it that no harm is done to the general
out. (p. 338, lbid) One or two days after the typhoon, public"... considering that electricity is an agency, subtle and
the INELCO people heard "rumors that someone was deadly, the measure of care required of electric companies must be
electrocuted" so he sent one of his men to the place commensurate with or proportionate to the danger. The duty of
but his man reported back that there was no exercising this high degree of diligence and care extends to every
damaged wire. (p. 385, Id.) Loreto Abijero, chief place where persons have a right to be" (Astudillo vs. Manila
lineman of defendant, corroborated Engr. Juan. He Electric, 55 Phil. 427). The negligence of petitioner having been
testified that at about 8:00 A.M. on June 29, 1967 shown, it may not now absolve itself from liability by arguing that
Engr. Juan came to the INELCO plant and asked the victim's death was solely due to a fortuitous event. "When an
the INELCO people to inspect their lines. He went act of God combines or concurs with the negligence of the
with Engr. Juan and their inspection lasted from defendant to produce an injury, the defendant is liable if the injury
8:00 A.M. to 12:00 noon. (pp. 460, 465, TSN, Jan. would not have resulted but for his own negligent conduct or
28, 1975) Fabico Abijero lineman of defendant, omission" (38 Am. Jur., p. 649).
testified that at about 6:00 on June 29, 1967 the Likewise, the maxim "volenti non fit injuria" relied upon by
typhoon ceased. At that time, he was at the main petitioner finds no application in the case at bar. It is imperative to
building of the Divine Word College of Laoag where note the surrounding circumstances which impelled the deceased
to leave the comforts of a roof and brave the subsiding typhoon. As

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testified by Linda Alonzo Estavillo (see TSN, p. 5, 26 Sept. 1972) that said wires were just hooked to the electric post (petitioner's
and Aida Bulong (see TSN, p. 43, 26 Sept. 1972), the deceased, Memorandum, p. 170, Rollo). However, as the CA properly held,
accompanied by the former two, were on their way to the latter's "(t)he finding of the lower court ... was based on what the
grocery store "to see to it that the goods were not flooded." As such, defendant's employees were supposed to do, not on what they
shall We punish her for exercising her right to protect her property actually did or failed to do on the date in question, and not on the
from the floods by imputing upon her the unfavorable presumption occasion of the emergency situation brought about by the typhoon"
that she assumed the risk of personal injury? Definitely not. For it (CA Decision, p. 25, Rollo). And as found by the CA, which We have
has been held that a person is excused from the force of the rule, already reiterated above, petitioner was in fact negligent. In a like
that when he voluntarily assents to a known danger he must abide manner, petitioner's denial of ownership of the several wires
by the consequences, if an emergency is found to exist or if the life cannot stand the logical conclusion reached by the CA when it held
or property of another is in peril (65A C.S.C. Negligence(174(5), p. that "(t)he nature of the wounds as described by the witnesses who
301), or when he seeks to rescue his endangered property (Harper saw them can lead to no other conclusion than that they were
and James, "The Law of Torts." Little, Brown and Co., 1956, v. 2, p. 'burns', and there was nothing else in the street where the victim
1167). Clearly, an emergency was at hand as the deceased's was wading thru which could cause a burn except the dangling live
property, a source of her livelihood, was faced with an impending wire of defendant company" (supra).
loss. Furthermore, the deceased, at the time the fatal incident "When a storm occurs that is liable to prostrate the wires, due care
occurred, was at a place where she had a right to be without regard requires prompt efforts to discover and repair broken lines" (Cooley
to petitioner's consent as she was on her way to protect her on Torts, 4th ed., v. 3, p. 474). The fact is that when Engineer
merchandise. Hence, private respondents, as heirs, may not be Antonio Juan of the National Power Corporation set out in the early
barred from recovering damages as a result of the death caused by morning of June 29, 1967 on an inspection tour, he saw grounded
petitioner's negligence (ibid., p. 1165, 1166). and disconnected lines hanging from posts to the ground but did
But petitioner assails the CA for having abused its discretion in not see any INELCO lineman either in the streets or at the INELCO
completely reversing the trial court's findings of fact, pointing to office (vide, CA Decision, supra). The foregoing shows that
the testimonies of three of its employees its electrical engineer, petitioner's duty to exercise extraordinary diligence under the
collector-inspector, lineman, and president-manager to the effect circumstance was not observed, confirming the negligence of
that it had exercised the degree of diligence required of it in petitioner. To aggravate matters, the CA found:
keeping its electric lines free from defects that may imperil life and . . .even before June 28 the people in Laoag were
limb. Likewise, the said employees of petitioner categorically already alerted about the impending typhoon,
disowned the fatal wires as they appear in two photographs taken through radio announcements. Even the fire
on the afternoon of June 29, 1967 (Exhs. "D" and "E"), suggesting department of the city announced the coming of the

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big flood. (pp. 532-534, TSN, March 13, 1975) At the of P12,000 to P30,000, thus, increasing the total actual damages to
INELCO irregularities in the flow of electric current P48,229.45.
were noted because "amperes of the switch volts The exclusion of moral damages and attorney's fees awarded by the
were moving". And yet, despite these danger signals, lower court was properly made by the respondent CA, the charge of
INELCO had to wait for Engr. Juan to request that malice and bad faith on the part of respondents in instituting his
defendant's switch be cut off but the harm was case being a mere product of wishful thinking and speculation.
done. Asked why the delay, Loreto Abijero answered Award of damages and attorney's fees is unwarranted where the
that he "was not the machine tender of the electric action was filed in good faith; there should be no penalty on the
plant to switch off the current." (pp. 467-468, Ibid.) right to litigate (Espiritu vs. CA, 137 SCRA 50). If damage results
How very characteristic of gross inefficiency! (CA from a person's exercising his legal rights, it is damnum absque
Decision, p. 26, Rollo) injuria (Auyong Hian vs. CTA, 59 SCRA 110).
From the preceding, We find that the CA did not abuse its WHEREFORE, the questioned decision of the respondent, except
discretion in reversing the trial court's findings but tediously for the slight modification that actual damages be increased to
considered the factual circumstances at hand pursuant to its P48,229.45 is hereby AFFIRMED.
power to review questions of fact raised from the decision of the SO ORDERED.
Regional Trial Court, formerly the Court of First Instance (see sec.
9, BP 129).
In considering the liability of petitioner, the respondent CA
awarded the following in private respondent's favor: P30,229.45 in
actual damages (i.e., P12,000 for the victim's death and
P18,229.45 for funeral expenses); P50,000 in compensatory
damages, computed in accordance with the formula set in the
Villa-Rey Transit case (31 SCRA 511) with the base of P15,000 as
average annual income of the deceased; P10,000 in exemplary
damages; P3,000 attorney's fees; and costs of suit. Except for the
award of P12,000 as compensation for the victim's death, We affirm
the respondent CA's award for damages and attorney's fees.
Pusuant to recent jurisprudence (People vs. Mananquil, 132 SCRA
196; People vs. Traya, 147 SCRA 381), We increase the said award

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Republic of the Philippines was doing so, an Isuzu truck driven by Iglecerio Verena and owned
SUPREME COURT by Francisco Salva bumped the left rear portion of the jeepney. As
Manila a result, Sunga was injured. She sustained a fracture of the "distal
SECOND DIVISION third of the left tibia-fibula with severe necrosis of the underlying
skin." Closed reduction of the fracture, long leg circular casting,
G.R. No. 122039 May 31, 2000 and case wedging were done under sedation. Her confinement in
VICENTE CALALAS, petitioner, the hospital lasted from August 23 to September 7, 1989. Her
vs. attending physician, Dr. Danilo V. Oligario, an orthopedic surgeon,
COURT OF APPEALS, ELIZA JUJEURCHE SUNGA and certified she would remain on a cast for a period of three months
FRANCISCO SALVA, respondents. and would have to ambulate in crutches during said period.
On October 9, 1989, Sunga filed a complaint for damages against
MENDOZA, J.: Calalas, alleging violation of the contract of carriage by the former
This is a petition for review on certiorari of the decision1 of the in failing to exercise the diligence required of him as a common
Court of Appeals, dated March 31, 1991, reversing the contrary carrier. Calalas, on the other hand, filed a third-party complaint
decision of the Regional Trial Court, Branch 36, Dumaguete City, against Francisco Salva, the owner of the Isuzu truck.
and awarding damages instead to private respondent Eliza The lower court rendered judgment against Salva as third-party
Jujeurche Sunga as plaintiff in an action for breach of contract of defendant and absolved Calalas of liability, holding that it was the
carriage. driver of the Isuzu truck who was responsible for the accident. It
The facts, as found by the Court of Appeals, are as follows: took cognizance of another case (Civil Case No. 3490), filed by
At 10 o'clock in the morning of August 23, 1989, private Calalas against Salva and Verena, for quasi-delict, in which
respondent Eliza Jujeurche G. Sunga, then a college freshman Branch 37 of the same court held Salva and his driver Verena
majoring in Physical Education at the Siliman University, took a jointly liable to Calalas for the damage to his jeepney.
passenger jeepney owned and operated by petitioner Vicente On appeal to the Court of Appeals, the ruling of the lower court
Calalas. As the jeepney was filled to capacity of about 24 was reversed on the ground that Sunga's cause of action was based
passengers, Sunga was given by the conductor an "extension seat," on a contract of carriage, not quasi-delict, and that the common
a wooden stool at the back of the door at the rear end of the carrier failed to exercise the diligence required under the Civil
vehicle. Code. The appellate court dismissed the third-party complaint
On the way to Poblacion Sibulan, Negros Occidental, the jeepney against Salva and adjudged Calalas liable for damages to Sunga.
stopped to let a passenger off. As she was seated at the rear of the The dispositive portion of its decision reads:
vehicle, Sunga gave way to the outgoing passenger. Just as she

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WHEREFORE, the decision appealed from is hereby contractual, has as its source the negligence of the tortfeasor. The
REVERSED and SET ASIDE, and another one is second, breach of contract or culpa contractual, is premised upon
entered ordering defendant-appellee Vicente Calalas the negligence in the performance of a contractual obligation.
to pay plaintiff-appellant: Consequently, in quasi-delict, the negligence or fault should be
(1) P50,000.00 as actual and compensatory clearly established because it is the basis of the action, whereas in
damages; breach of contract, the action can be prosecuted merely by proving
(2) P50,000.00 as moral damages; the existence of the contract and the fact that the obligor, in this
(3) P10,000.00 as attorney's fees; and case the common carrier, failed to transport his passenger safely to
(4) P1,000.00 as expenses of litigation; and his destination.2 In case of death or injuries to passengers, Art.
(5) to pay the costs. 1756 of the Civil Code provides that common carriers are
SO ORDERED. presumed to have been at fault or to have acted negligently unless
Hence, this petition. Petitioner contends that the ruling in Civil they prove that they observed extraordinary diligence as defined in
Case No. 3490 that the negligence of Verena was the proximate Arts. 1733 and 1755 of the Code. This provision necessarily shifts
cause of the accident negates his liability and that to rule to the common carrier the burden of proof.
otherwise would be to make the common carrier an insurer of the There is, thus, no basis for the contention that the ruling in Civil
safety of its passengers. He contends that the bumping of the Case No. 3490, finding Salva and his driver Verena liable for the
jeepney by the truck owned by Salva was a caso fortuito. Petitioner damage to petitioner's jeepney, should be binding on Sunga. It is
further assails the award of moral damages to Sunga on the immaterial that the proximate cause of the collision between the
ground that it is not supported by evidence. jeepney and the truck was the negligence of the truck driver. The
The petition has no merit. doctrine of proximate cause is applicable only in actions for quasi-
The argument that Sunga is bound by the ruling in Civil Case No. delict, not in actions involving breach of contract. The doctrine is a
3490 finding the driver and the owner of the truck liable for quasi- device for imputing liability to a person where there is no relation
delict ignores the fact that she was never a party to that case and, between him and another party. In such a case, the obligation is
therefore, the principle of res judicata does not apply. created by law itself. But, where there is a pre-existing contractual
Nor are the issues in Civil Case No. 3490 and in the present case relation between the parties, it is the parties themselves who create
the same. The issue in Civil Case No. 3490 was whether Salva and the obligation, and the function of the law is merely to regulate the
his driver Verena were liable for quasi-delict for the damage caused relation thus created. Insofar as contracts of carriage are
to petitioner's jeepney. On the other hand, the issue in this case is concerned, some aspects regulated by the Civil Code are those
whether petitioner is liable on his contract of carriage. The first, respecting the diligence required of common carriers with regard to
quasi-delict, also known as culpa aquiliana or culpa extra

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the safety of passengers as well as the presumption of negligence in cautious persons, with due regard for all the circumstances" as
cases of death or injury to passengers. It provides: required by Art. 1755? We do not think so. Several factors militate
Art. 1733. Common carriers, from the nature of against petitioner's contention.
their business and for reasons of public policy, are First, as found by the Court of Appeals, the jeepney was not
bound to observe extraordinary diligence in the properly parked, its rear portion being exposed about two meters
vigilance over the goods and for the safety of the from the broad shoulders of the highway, and facing the middle of
passengers transported by them, according to all the the highway in a diagonal angle. This is a violation of the R.A. No.
circumstances of each case. 4136, as amended, or the Land Transportation and Traffic Code,
Such extraordinary diligence in the vigilance over which provides:
the goods is further expressed in articles 1734, Sec. 54. Obstruction of Traffic. No person shall
1735, and 1746, Nos. 5, 6, and 7, while the drive his motor vehicle in such a manner as to
extraordinary diligence for the safety of the obstruct or impede the passage of any vehicle, nor,
passengers is further set forth in articles 1755 and while discharging or taking on passengers or loading
1756. or unloading freight, obstruct the free passage of
Art. 1755. A common carrier is bound to carry the other vehicles on the highway.
passengers safely as far as human care and Second, it is undisputed that petitioner's driver took in more
foresight can provide, using the utmost diligence of passengers than the allowed seating capacity of the jeepney, a
very cautious persons, with due regard for all the violation of 32(a) of the same law. It provides:
circumstances. Exceeding registered capacity. No person
Art. 1756. In case of death of or injuries to operating any motor vehicle shall allow more
passengers, common carriers are presumed to have passengers or more freight or cargo in his vehicle
been at fault or to have acted negligently, unless than its registered capacity.
they prove that they observed extraordinary The fact that Sunga was seated in an "extension seat" placed her in
diligence as prescribed by articles 1733 and 1755. a peril greater than that to which the other passengers were
In the case at bar, upon the happening of the accident, the exposed. Therefore, not only was petitioner unable to overcome the
presumption of negligence at once arose, and it became the duty of presumption of negligence imposed on him for the injury sustained
petitioner to prove that he had to observe extraordinary diligence in by Sunga, but also, the evidence shows he was actually negligent
the care of his passengers. in transporting passengers.
Now, did the driver of jeepney carry Sunga "safely as far as human We find it hard to give serious thought to petitioner's contention
care and foresight could provide, using the utmost diligence of very that Sunga's taking an "extension seat" amounted to an implied

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assumption of risk. It is akin to arguing that the injuries to the Plaintiff-appellant likewise testified that even while
many victims of the tragedies in our seas should not be she was under confinement, she cried in pain
compensated merely because those passengers assumed a greater because of her injured left foot. As a result of her
risk of drowning by boarding an overloaded ferry. This is also true injury, the Orthopedic Surgeon also certified that
of petitioner's contention that the jeepney being bumped while it she has "residual bowing of the fracture side." She
was improperly parked constitutes caso fortuito. A caso fortuito is likewise decided not to further pursue Physical
an event which could not be foreseen, or which, though foreseen, Education as her major subject, because "my left leg
was inevitable.3 This requires that the following requirements be . . . has a defect already."
present: (a) the cause of the breach is independent of the debtor's Those are her physical pains and moral sufferings,
will; (b) the event is unforeseeable or unavoidable; (c) the event is the inevitable bedfellows of the injuries that she
such as to render it impossible for the debtor to fulfill his suffered. Under Article 2219 of the Civil Code, she is
obligation in a normal manner, and (d) the debtor did not take part entitled to recover moral damages in the sum of
in causing the injury to the P50,000.00, which is fair, just and reasonable.
creditor. Petitioner should have foreseen the danger of parking his
4 As a general rule, moral damages are not recoverable in actions for
jeepney with its body protruding two meters into the highway. damages predicated on a breach of contract for it is not one of the
Finally, petitioner challenges the award of moral damages alleging items enumerated under Art. 2219 of the Civil Code.5 As an
that it is excessive and without basis in law. We find this exception, such damages are recoverable: (1) in cases in which the
contention well taken. mishap results in the death of a passenger, as provided in Art.
In awarding moral damages, the Court of Appeals stated: 1764, in relation to Art. 2206(3) of the Civil Code; and (2) in the
Plaintiff-appellant at the time of the accident was a cases in which the carrier is guilty of fraud or bad faith, as
first-year college student in that school year 1989- provided in Art. 2220. 6
1990 at the Silliman University, majoring in Physical In this case, there is no legal basis for awarding moral damages
Education. Because of the injury, she was not able since there was no factual finding by the appellate court that
to enroll in the second semester of that school year. petitioner acted in bad faith in the performance of the contract of
She testified that she had no more intention of carriage. Sunga's contention that petitioner's admission in open
continuing with her schooling, because she could court that the driver of the jeepney failed to assist her in going to a
not walk and decided not to pursue her degree, nearby hospital cannot be construed as an admission of bad faith.
major in Physical Education "because of my leg The fact that it was the driver of the Isuzu truck who took her to
which has a defect already." the hospital does not imply that petitioner was utterly indifferent to

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the plight of his injured passenger. If at all, it is merely implied
recognition by Verena that he was the one at fault for the accident.
WHEREFORE, the decision of the Court of Appeals, dated March
31, 1995, and its resolution, dated September 11, 1995, are
AFFIRMED, with the MODIFICATION that the award of moral
damages is DELETED.
SO ORDERED.

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Republic of the Philippines sat with the party of Dr. Filart.10 After a couple of hours, when the
SUPREME COURT buffet dinner was ready, Mr. Reyes lined-up at the buffet table but,
Manila to his great shock, shame and embarrassment, he was stopped by
SECOND DIVISION petitioner herein, Ruby Lim, who claimed to speak for Hotel Nikko
G.R. No. 154259 February 28, 2005 as Executive Secretary thereof.11 In a loud voice and within the
NIKKO HOTEL MANILA GARDEN and RUBY LIM, petitioners, presence and hearing of the other guests who were making a queue
vs. at the buffet table, Ruby Lim told him to leave the party ("huwag ka
ROBERTO REYES, a.k.a. "AMAY BISAYA," respondent. nang kumain, hindi ka imbitado, bumaba ka na lang").12 Mr. Reyes
DECISION tried to explain that he was invited by Dr. Filart. 13 Dr. Filart, who
CHICO-NAZARIO, J.: was within hearing distance, however, completely ignored him thus
In this petition for review on certiorari, petitioners Nikko Hotel adding to his shame and humiliation.14 Not long after, while he was
Manila Garden (Hotel Nikko)1 and Ruby Lim assail the Decision2 of still recovering from the traumatic experience, a Makati policeman
the Court of Appeals dated 26 November 2001 reversing the approached and asked him to step out of the hotel.15 Like a
Decision3 of the Regional Trial Court (RTC) of Quezon City, Branch common criminal, he was escorted out of the party by the
104, as well as the Resolution4 of the Court of Appeals dated 09 policeman.16 Claiming damages, Mr. Reyes asked for One Million
July 2002 which denied petitioners motion for reconsideration. Pesos actual damages, One Million Pesos moral and/or exemplary
The cause of action before the trial court was one for damages damages and Two Hundred Thousand Pesos attorneys fees. 17
brought under the human relations provisions of the New Civil Ruby Lim, for her part, admitted having asked Mr. Reyes to leave
Code. Plaintiff thereat (respondent herein) Roberto Reyes, more the party but not under the ignominious circumstance painted by
popularly known by the screen name "Amay Bisaya," alleged that the latter. Ms. Lim narrated that she was the Hotels Executive
at around 6:00 oclock in the evening of 13 October 1994, while he Secretary for the past twenty (20) years.18 One of her functions
was having coffee at the lobby of Hotel Nikko,5 he was spotted by included organizing the birthday party of the hotels former General
his friend of several years, Dr. Violeta Filart, who then approached Manager, Mr. Tsuruoka.19 The year 1994 was no different. For Mr.
him.6 Mrs. Filart invited him to join her in a party at the hotels Tsuruokas party, Ms. Lim generated an exclusive guest list and
penthouse in celebration of the natal day of the hotels manager, extended invitations accordingly. 20 The guest list was limited to
Mr. Masakazu Tsuruoka.7 Mr. Reyes asked if she could vouch for approximately sixty (60) of Mr. Tsuruokas closest friends and some
him for which she replied: "of course."8 Mr. Reyes then went up hotel employees and that Mr. Reyes was not one of those invited. 21
with the party of Dr. Filart carrying the basket of fruits which was At the party, Ms. Lim first noticed Mr. Reyes at the bar counter
the latters present for the celebrant.9 At the penthouse, they first ordering a drink.22 Mindful of Mr. Tsuruokas wishes to keep the
had their picture taken with the celebrant after which Mr. Reyes party intimate, Ms. Lim approached Mr. Boy Miller, the "captain

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waiter," to inquire as to the presence of Mr. Reyes who was not celebrant as he was likewise going to take the elevator, not to the
invited.23 Mr. Miller replied that he saw Mr. Reyes with the group of penthouse but to Altitude 49.35 When they reached the penthouse,
Dr. Filart.24 As Dr. Filart was engaged in conversation with another she reminded Mr. Reyes to go down as he was not properly dressed
guest and as Ms. Lim did not want to interrupt, she inquired and was not invited.36 All the while, she thought that Mr. Reyes
instead from the sister of Dr. Filart, Ms. Zenaida Fruto, who told already left the place, but she later saw him at the bar talking to
her that Dr. Filart did not invite Mr. Reyes.25 Ms. Lim then Col. Batung.37 Then there was a commotion and she saw Mr. Reyes
requested Ms. Fruto to tell Mr. Reyes to leave the party as he was shouting.38 She ignored Mr. Reyes.39 She was embarrassed and did
not invited.26 Mr. Reyes, however, lingered prompting Ms. Lim to not want the celebrant to think that she invited him. 40
inquire from Ms. Fruto who said that Mr. Reyes did not want to After trial on the merits, the court a quo dismissed the complaint,41
leave.27 When Ms. Lim turned around, she saw Mr. Reyes giving more credence to the testimony of Ms. Lim that she was
conversing with a Captain Batung whom she later approached. 28 discreet in asking Mr. Reyes to leave the party. The trial court
Believing that Captain Batung and Mr. Reyes knew each other, Ms. likewise ratiocinated that Mr. Reyes assumed the risk of being
Lim requested from him the same favor from Ms. Fruto, i.e., for thrown out of the party as he was uninvited:
Captain Batung to tell Mr. Reyes to leave the party as he was not Plaintiff had no business being at the party because he was not a
invited.29 Still, Mr. Reyes lingered. When Ms. Lim spotted Mr. guest of Mr. Tsuruoka, the birthday celebrant. He assumed the
Reyes by the buffet table, she decided to speak to him herself as risk of being asked to leave for attending a party to which he was
there were no other guests in the immediate vicinity. 30 However, as not invited by the host. Damages are pecuniary consequences
Mr. Reyes was already helping himself to the food, she decided to which the law imposes for the breach of some duty or the violation
wait.31 When Mr. Reyes went to a corner and started to eat, Ms. of some right. Thus, no recovery can be had against defendants
Lim approached him and said: "alam ninyo, hindo ho kayo dapat Nikko Hotel and Ruby Lim because he himself was at fault
nandito. Pero total nakakuha na ho kayo ng pagkain, ubusin na (Garciano v. Court of Appeals, 212 SCRA 436). He knew that it was
lang ninyo at pagkatapos kung pwede lang po umalis na kayo."32 not the party of defendant Violeta Filart even if she allowed him to
She then turned around trusting that Mr. Reyes would show join her and took responsibility for his attendance at the party. His
enough decency to leave, but to her surprise, he began screaming action against defendants Nikko Hotel and Ruby Lim must
and making a big scene, and even threatened to dump food on therefore fail.42
her.331awphi1.nt On appeal, the Court of Appeals reversed the ruling of the trial
Dr. Violeta Filart, the third defendant in the complaint before the court as it found more commanding of belief the testimony of Mr.
lower court, also gave her version of the story to the effect that she Reyes that Ms. Lim ordered him to leave in a loud voice within
never invited Mr. Reyes to the party.34 According to her, it was Mr. hearing distance of several guests:
Reyes who volunteered to carry the basket of fruits intended for the

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In putting appellant in a very embarrassing situation, telling him violates this duty becomes liable for damages, especially if said acts
that he should not finish his food and to leave the place within the were attended by malice or bad faith. Bad faith does not simply
hearing distance of other guests is an act which is contrary to connote bad judgment or simple negligence. It imports a dishonest
morals, good customs . . ., for which appellees should compensate purpose or some moral obliquity and conscious doing of a wrong, a
the appellant for the damage suffered by the latter as a breach of a known duty to some motive or interest or ill-will that
consequence therefore (Art. 21, New Civil Code). The liability arises partakes of the nature of fraud (Cojuangco, Jr. v. CA, et al., 309
from the acts which are in themselves legal or not prohibited, but SCRA 603).44
contrary to morals or good customs. Conversely, even in the Consequently, the Court of Appeals imposed upon Hotel Nikko,
exercise of a formal right, [one] cannot with impunity intentionally Ruby Lim and Dr. Violeta Filart the solidary obligation to pay Mr.
cause damage to another in a manner contrary to morals or good Reyes (1) exemplary damages in the amount of Two Hundred
customs.43 Thousand Pesos (P200,000); (2) moral damages in the amount of
The Court of Appeals likewise ruled that the actuation of Ms. Lim Two Hundred Thousand Pesos (P200,000); and (3) attorneys fees
in approaching several people to inquire into the presence of Mr. in the amount of Ten Thousand Pesos (P10,000). 45 On motion for
Reyes exposed the latter to ridicule and was uncalled for as she reconsideration, the Court of Appeals affirmed its earlier decision
should have approached Dr. Filart first and both of them should as the argument raised in the motion had "been amply discussed
have talked to Mr. Reyes in private: and passed upon in the decision sought to be reconsidered." 46
Said acts of appellee Lim are uncalled for. What should have been Thus, the instant petition for review. Hotel Nikko and Ruby Lim
done by appellee Lim was to approach appellee Mrs. Filart and contend that the Court of Appeals seriously erred in
together they should have told appellant Reyes in private that the I.
latter should leave the party as the celebrant only wanted close NOT APPLYING THE DOCTRINE OF VOLENTI NON FIT INJURIA
friends around. It is necessary that Mrs. Filart be the one to CONSIDERING THAT BY ITS OWN FINDINGS, AMAY BISAYA WAS
approach appellant because it was she who invited appellant in A GATE-CRASHER
that occasion. Were it not for Mrs. Filarts invitation, appellant II.
could not have suffered such humiliation. For that, appellee Filart HOLDING HOTEL NIKKO AND RUBY LIM JOINTLY AND
is equally liable. SEVERALLY LIABLE WITH DR. FILART FOR DAMAGES SINCE BY
... ITS OWN RULING, AMAY BISAYA "COULD NOT HAVE SUFFERED
The acts of [appellee] Lim are causes of action which are predicated SUCH HUMILIATION," "WERE IT NOT FOR DR. FILARTS
upon mere rudeness or lack of consideration of one person, which INVITATION"
calls not only protection of human dignity but respect of such III.
dignity. Under Article 20 of the Civil Code, every person who

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DEPARTING FROM THE FINDINGS OF FACT OF THE TRIAL the party where he was not invited by the celebrant thereof thereby
COURT AS REGARDS THE CIRCUMSTANCES THAT ALLEGEDLY becoming liable under Articles 19 and 21 of the Civil Code.
CAUSED THE HUMILIATION OF AMAY BISAYA Parenthetically, and if Ruby Lim were so liable, whether or not
IV. Hotel Nikko, as her employer, is solidarily liable with her.
IN CONCLUDING THAT AMAY BISAYA WAS TREATED As the trial court and the appellate court reached divergent and
UNJUSTLY BECAUSE OF HIS POVERTY, CONSIDERING THAT irreconcilable conclusions concerning the same facts and evidence
THIS WAS NEVER AN ISSUE AND NO EVIDENCE WAS of the case, this Court is left without choice but to use its latent
PRESENTED IN THIS REGARD power to review such findings of facts. Indeed, the general rule is
V. that we are not a trier of facts as our jurisdiction is limited to
IN FAILING TO PASS UPON THE ISSUE ON THE DEFECTS OF reviewing and revising errors of law.51 One of the exceptions to this
THE APPELLANTS BRIEF, THEREBY DEPARTING FROM THE general rule, however, obtains herein as the findings of the Court of
ACCEPTED AND USUAL COURSE OF JUDICIAL PROCEEDINGS Appeals are contrary to those of the trial court. 52 The lower court
Petitioners Lim and Hotel Nikko contend that pursuant to the ruled that Ms. Lim did not abuse her right to ask Mr. Reyes to
doctrine of volenti non fit injuria, they cannot be made liable for leave the party as she talked to him politely and discreetly. The
damages as respondent Reyes assumed the risk of being asked to appellate court, on the other hand, held that Ms. Lim is liable for
leave (and being embarrassed and humiliated in the process) as he damages as she needlessly embarrassed Mr. Reyes by telling him
was a "gate-crasher." not to finish his food and to leave the place within hearing distance
The doctrine of volenti non fit injuria ("to which a person assents is of the other guests. Both courts, however, were in agreement that it
not esteemed in law as injury"47 ) refers to self-inflicted injury48 or was Dr. Filarts invitation that brought Mr. Reyes to the party.
to the consent to injury49 which precludes the recovery of damages The consequential question then is: Which version is credible?
by one who has knowingly and voluntarily exposed himself to From an in depth review of the evidence, we find more credible the
danger, even if he is not negligent in doing so.50 As formulated by lower courts findings of fact.
petitioners, however, this doctrine does not find application to the First, let us put things in the proper perspective.
case at bar because even if respondent Reyes assumed the risk of We are dealing with a formal party in a posh, five-star hotel,53 for-
being asked to leave the party, petitioners, under Articles 19 and invitation-only, thrown for the hotels former Manager, a Japanese
21 of the New Civil Code, were still under obligation to treat him national. Then came a person who was clearly uninvited (by the
fairly in order not to expose him to unnecessary ridicule and celebrant)54 and who could not just disappear into the crowd as his
shame. face is known by many, being an actor. While he was already
Thus, the threshold issue is whether or not Ruby Lim acted spotted by the organizer of the party, Ms. Lim, the very person who
abusively in asking Roberto Reyes, a.k.a. "Amay Bisaya," to leave generated the guest list, it did not yet appear that the celebrant

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was aware of his presence. Ms. Lim, mindful of the celebrants years wherein being polite and discreet are virtues to be emulated,
instruction to keep the party intimate, would naturally want to get the testimony of Mr. Reyes that she acted to the contrary does not
rid of the "gate-crasher" in the most hush-hush manner in order inspire belief and is indeed incredible. Thus, the lower court was
not to call attention to a glitch in an otherwise seamless affair and, correct in observing that
in the process, risk the displeasure of the celebrant, her former Considering the closeness of defendant Lim to plaintiff when the
boss. To unnecessarily call attention to the presence of Mr. Reyes request for the latter to leave the party was made such that they
would certainly reflect badly on Ms. Lims ability to follow the nearly kissed each other, the request was meant to be heard by
instructions of the celebrant to invite only his close friends and him only and there could have been no intention on her part to
some of the hotels personnel. Mr. Reyes, upon whom the burden cause embarrassment to him. It was plaintiffs reaction to the
rests to prove that indeed Ms. Lim loudly and rudely ordered him request that must have made the other guests aware of what
to leave, could not offer any satisfactory explanation why Ms. Lim transpired between them. . .
would do that and risk ruining a formal and intimate affair. On the Had plaintiff simply left the party as requested, there was no need
contrary, Mr. Reyes, on cross-examination, had unwittingly sealed for the police to take him out.56
his fate by admitting that when Ms. Lim talked to him, she was Moreover, another problem with Mr. Reyess version of the story is
very close. Close enough for him to kiss: that it is unsupported. It is a basic rule in civil cases that he who
Q: And, Mr. Reyes, you testified that Miss Lim approached alleges proves. Mr. Reyes, however, had not presented any witness
you while you were at the buffet table? How close was she to back his story up. All his witnesses Danny Rodinas, Pepito
when she approached you? Guerrero and Alexander Silva - proved only that it was Dr. Filart
A: Very close because we nearly kissed each other. who invited him to the party.57
Q: And yet, she shouted for you to go down? She was that Ms. Lim, not having abused her right to ask Mr. Reyes to leave the
close and she shouted? party to which he was not invited, cannot be made liable to pay for
A: Yes. She said, "wag kang kumain, hindi ka imbitado dito, damages under Articles 19 and 21 of the Civil Code. Necessarily,
bumaba ka na lang." neither can her employer, Hotel Nikko, be held liable as its liability
Q: So, you are testifying that she did this in a loud voice? springs from that of its employee. 58
... Article 19, known to contain what is commonly referred to as the
A: Yes. If it is not loud, it will not be heard by many. 55 principle of abuse of rights,59 is not a panacea for all human hurts
In the absence of any proof of motive on the part of Ms. Lim to and social grievances. Article 19 states:
humiliate Mr. Reyes and expose him to ridicule and shame, it is Art. 19. Every person must, in the exercise of his rights and in the
highly unlikely that she would shout at him from a very close performance of his duties, act with justice, give everyone his due,
distance. Ms. Lim having been in the hotel business for twenty and observe honesty and good faith.1awphi1.nt

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Elsewhere, we explained that when "a right is exercised in a for an explanation for Ms. Lims alleged abusive conduct except the
manner which does not conform with the norms enshrined in statement that Ms. Lim, being "single at 44 years old," had a "very
Article 19 and results in damage to another, a legal wrong is strong bias and prejudice against (Mr. Reyes) possibly influenced
thereby committed for which the wrongdoer must be responsible."60 by her associates in her work at the hotel with foreign
The object of this article, therefore, is to set certain standards businessmen."69 The lameness of this argument need not be
which must be observed not only in the exercise of ones rights but belabored. Suffice it to say that a complaint based on Articles 19
also in the performance of ones duties.61 These standards are the and 21 of the Civil Code must necessarily fail if it has nothing to
following: act with justice, give everyone his due and observe recommend it but innuendos and conjectures.
honesty and good faith.62 Its antithesis, necessarily, is any act Parenthetically, the manner by which Ms. Lim asked Mr. Reyes to
evincing bad faith or intent to injure. Its elements are the following: leave was likewise acceptable and humane under the
(1) There is a legal right or duty; (2) which is exercised in bad faith; circumstances. In this regard, we cannot put our imprimatur on
(3) for the sole intent of prejudicing or injuring another. 63 When the appellate courts declaration that Ms. Lims act of personally
Article 19 is violated, an action for damages is proper under approaching Mr. Reyes (without first verifying from Mrs. Filart if
Articles 20 or 21 of the Civil Code. Article 20 pertains to damages indeed she invited Mr. Reyes) gave rise to a cause of action
arising from a violation of law64 which does not obtain herein as "predicated upon mere rudeness or lack of consideration of one
Ms. Lim was perfectly within her right to ask Mr. Reyes to leave. person, which calls not only protection of human dignity but
Article 21, on the other hand, states: respect of such dignity."70 Without proof of any ill-motive on her
Art. 21. Any person who willfully causes loss or injury to another part, Ms. Lims act of by-passing Mrs. Filart cannot amount to
in a manner that is contrary to morals, good customs or public abusive conduct especially because she did inquire from Mrs.
policy shall compensate the latter for the damage. Filarts companion who told her that Mrs. Filart did not invite Mr.
Article 2165 refers to acts contra bonus mores and has the following Reyes.71 If at all, Ms. Lim is guilty only of bad judgment which, if
elements: (1) There is an act which is legal; (2) but which is done with good intentions, cannot amount to bad faith.
contrary to morals, good custom, public order, or public policy; Not being liable for both actual and moral damages, neither can
and (3) it is done with intent to injure.66 petitioners Lim and Hotel Nikko be made answerable for exemplary
A common theme runs through Articles 19 and 21,67 and that is, damages72 especially for the reason stated by the Court of Appeals.
the act complained of must be intentional. 68 The Court of Appeals held
As applied to herein case and as earlier discussed, Mr. Reyes has Not a few of the rich people treat the poor with contempt because
not shown that Ms. Lim was driven by animosity against him. of the latters lowly station in life.l^vvphi1.net This has to be limited
These two people did not know each other personally before the somewhere. In a democracy, such a limit must be established.
evening of 13 October 1994, thus, Mr. Reyes had nothing to offer Social equality is not sought by the legal provisions under

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consideration, but due regard for decency and propriety (Code
Commission, pp. 33-34). And by way of example or correction for
public good and to avert further commission of such acts,
exemplary damages should be imposed upon appellees. 73
The fundamental fallacy in the above-quoted findings is that it
runs counter with the very facts of the case and the evidence on
hand.l^vvphi1.net It is not disputed that at the time of the incident
in question, Mr. Reyes was "an actor of long standing; a co-host of
a radio program over DZRH; a Board Member of the Music Singer
Composer (MUSICO) chaired by popular singer Imelda Papin; a
showbiz Coordinator of Citizen Crime Watch; and 1992 official
candidate of the KBL Party for Governor of Bohol; and an awardee
of a number of humanitarian organizations of the Philippines." 74
During his direct examination on rebuttal, Mr. Reyes stressed that
he had income75 and nowhere did he say otherwise. On the other
hand, the records are bereft of any information as to the social and
economic standing of petitioner Ruby Lim. Consequently, the
conclusion reached by the appellate court cannot withstand
scrutiny as it is without basis.
All told, and as far as Ms. Lim and Hotel Nikko are concerned, any
damage which Mr. Reyes might have suffered through Ms. Lims
exercise of a legitimate right done within the bounds of propriety
and good faith, must be his to bear alone.
WHEREFORE, premises considered, the petition filed by Ruby Lim
and Nikko Hotel Manila Garden is GRANTED. The Decision of the
Court of Appeals dated 26 November 2001 and its Resolution dated
09 July 2002 are hereby REVERSED and SET ASIDE. The Decision
of the Regional Trial Court of Quezon City, Branch 104, dated 26
April 1999 is hereby AFFIRMED. No costs.
SO ORDERED.

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Republic of the Philippines departure scheduled on that day, the tour group planned to leave
SUPREME COURT Coster by 9:30 a.m. at the latest.
Manila While at Coster, Mrs. Pantaleon decided to purchase some
SPECIAL SECOND DIVISION diamond pieces worth a total of US$13,826.00. Pantaleon
G.R. No. 174269 August 25, 2010 presented his American Express credit card to the sales clerk to
POLO S. PANTALEON, Petitioner, pay for this purchase. He did this at around 9:15 a.m. The sales
vs. clerk swiped the credit card and asked Pantaleon to sign the
AMERICAN EXPRESS INTERNATIONAL, INC., Respondent. charge slip, which was then electronically referred to AMEXs
RESOLUTION Amsterdam office at 9:20 a.m.5
BRION, J.: At around 9:40 a.m., Coster had not received approval from AMEX
We resolve the motion for reconsideration filed by respondent for the purchase so Pantaleon asked the store clerk to cancel the
American Express International, Inc. (AMEX) dated June 8, 2009, 1 sale. The store manager, however, convinced Pantaleon to wait a
seeking to reverse our Decision dated May 8, 2009 where we ruled few more minutes. Subsequently, the store manager informed
that AMEX was guilty of culpable delay in fulfilling its obligation to Pantaleon that AMEX was asking for bank references; Pantaleon
its cardholder petitioner Polo Pantaleon. Based on this conclusion, responded by giving the names of his Philippine depository banks.
we held AMEX liable for moral and exemplary damages, as well as At around 10 a.m., or 45 minutes after Pantaleon presented his
attorneys fees and costs of litigation.2 credit card, AMEX still had not approved the purchase. Since the
FACTUAL ANTECEDENTS city tour could not begin until the Pantaleons were onboard the
The established antecedents of the case are narrated below. tour bus, Coster decided to release at around 10:05 a.m. the
AMEX is a resident foreign corporation engaged in the business of purchased items to Pantaleon even without AMEXs approval.
providing credit services through the operation of a charge card When the Pantaleons finally returned to the tour bus, they found
system. Pantaleon has been an AMEX cardholder since 1980. 3 their travel companions visibly irritated. This irritation intensified
In October 1991, Pantaleon, together with his wife (Julialinda), when the tour guide announced that they would have to cancel the
daughter (Regina), and son (Adrian Roberto), went on a guided tour because of lack of time as they all had to be in Calais, Belgium
European tour. On October 25, 1991, the tour group arrived in by 3 p.m. to catch the ferry to London. 6
Amsterdam. Due to their late arrival, they postponed the tour of From the records, it appears that after Pantaleons purchase was
the city for the following day.4 transmitted for approval to AMEXs Amsterdam office at 9:20 a.m.;
The next day, the group began their sightseeing at around 8:50 was referred to AMEXs Manila office at 9:33 a.m.; and was
a.m. with a trip to the Coster Diamond House (Coster). To have approved by the Manila office at 10:19 a.m. At 10:38 a.m., AMEXs
enough time for take a guided city tour of Amsterdam before their Manila office finally transmitted the Approval Code to AMEXs

Page 101 of 205


Amsterdam office. In all, it took AMEX a total of 78 minutes to gross negligence. The appellate court found that AMEX exercised
approve Pantaleons purchase and to transmit the approval to the diligent efforts to effect the approval of Pantaleons purchases; the
jewelry store.7 purchase at Coster posed particularly a problem because it was at
After the trip to Europe, the Pantaleon family proceeded to the variance with Pantaleons established charge pattern. As there was
United States. Again, Pantaleon experienced delay in securing no proof that AMEX breached its contract, or that it acted in a
approval for purchases using his American Express credit card on wanton, fraudulent or malevolent manner, the appellate court
two separate occasions. He experienced the first delay when he ruled that AMEX could not be held liable for any form of damages.
wanted to purchase golf equipment in the amount of US$1,475.00 Pantaleon questioned this decision via a petition for review on
at the Richard Metz Golf Studio in New York on October 30, 1991. certiorari with this Court.
Another delay occurred when he wanted to purchase childrens In our May 8, 2009 decision, we reversed the appellate courts
shoes worth US$87.00 at the Quiency Market in Boston on decision and held that AMEX was guilty of mora solvendi, or
November 3, 1991. debtors default. AMEX, as debtor, had an obligation as the credit
Upon return to Manila, Pantaleon sent AMEX a letter demanding provider to act on Pantaleons purchase requests, whether to
an apology for the humiliation and inconvenience he and his family approve or disapprove them, with "timely dispatch." Based on the
experienced due to the delays in obtaining approval for his credit evidence on record, we found that AMEX failed to timely act on
card purchases. AMEX responded by explaining that the delay in Pantaleons purchases.
Amsterdam was due to the amount involved the charged Based only, actual obligations. 271,ct; moral damages le. uitable
purchase of US$13,826.00 deviated from Pantaleons established that attorney'workers;plaitniff' the testimony of AMEXs credit
charge purchase pattern. Dissatisfied with this explanation, authorizer Edgardo Jaurique, the approval time for credit card
Pantaleon filed an action for damages against the credit card charges would be three to four seconds under regular
company with the Makati City Regional Trial Court (RTC). circumstances. In Pantaleons case, it took AMEX 78 minutes to
On August 5, 1996, the RTC found AMEX guilty of delay, and approve the Amsterdam purchase. We attributed this delay to
awarded Pantaleon P500,000.00 as moral damages, P300,000.00 AMEXs Manila credit authorizer, Edgardo Jaurique, who had to go
as exemplary damages, P100,000.00 as attorneys fees, and over Pantaleons past credit history, his payment record and his
P85,233.01 as litigation expenses. credit and bank references before he approved the purchase.
On appeal, the CA reversed the awards.8 While the CA recognized Finding this delay unwarranted, we reinstated the RTC decision
that delay in the nature of mora accipiendi or creditors default and awarded Pantaleon moral and exemplary damages, as well as
attended AMEXs approval of Pantaleons purchases, it disagreed attorneys fees and costs of litigation.
with the RTCs finding that AMEX had breached its contract, THE MOTION FOR RECONSIDERATION
noting that the delay was not attended by bad faith, malice or

Page 102 of 205


In its motion for reconsideration, AMEX argues that this Court humiliation had he cancelled the sale when he noticed that the
erred when it found AMEX guilty of culpable delay in complying credit approval for the Coster purchase was unusually delayed.
with its obligation to act with timely dispatch on Pantaleons In his Comment dated February 24, 2010, Pantaleon maintains
purchases. While AMEX admits that it normally takes seconds to that AMEX was guilty of mora solvendi, or delay on the part of the
approve charge purchases, it emphasizes that Pantaleon debtor, in complying with its obligation to him. Based on
experienced delay in Amsterdam because his transaction was not a jurisprudence, a just cause for delay does not relieve the debtor in
normal one. To recall, Pantaleon sought to charge in a single delay from the consequences of delay; thus, even if AMEX had a
transaction jewelry items purchased from Coster in the total justifiable reason for the delay, this reason would not relieve it
amount of US$13,826.00 or P383,746.16. While the total amount from the liability arising from its failure to timely act on
of Pantaleons previous purchases using his AMEX credit card did Pantaleons purchase.
exceed US$13,826.00, AMEX points out that these purchases were In response to AMEXs assertion that the delay was in keeping with
made in a span of more than 10 years, not in a single transaction. its duty to perform its obligation with extraordinary diligence,
Because this was the biggest single transaction that Pantaleon ever Pantaleon claims that this duty includes the timely or prompt
made using his AMEX credit card, AMEX argues that the performance of its obligation.
transaction necessarily required the credit authorizer to carefully As to AMEXs contention that moral or exemplary damages cannot
review Pantaleons credit history and bank references. AMEX be awarded absent a finding of malice, Pantaleon argues that evil
maintains that it did this not only to ensure Pantaleons protection motive or design is not always necessary to support a finding of
(to minimize the possibility that a third party was fraudulently bad faith; gross negligence or wanton disregard of contractual
using his credit card), but also to protect itself from the risk that obligations is sufficient basis for the award of moral and exemplary
Pantaleon might not be able to pay for his purchases on credit. damages.
This careful review, according to AMEX, is also in keeping with the OUR RULING
extraordinary degree of diligence required of banks in handling its We GRANT the motion for reconsideration.
transactions. AMEX concluded that in these lights, the thorough Brief historical background
review of Pantaleons credit record was motivated by legitimate A credit card is defined as "any card, plate, coupon book, or other
concerns and could not be evidence of any ill will, fraud, or credit device existing for the purpose of obtaining money, goods,
negligence by AMEX. property, labor or services or anything of value on credit." 9 It traces
AMEX further points out that the proximate cause of Pantaleons its roots to the charge card first introduced by the Diners Club in
humiliation and embarrassment was his own decision to proceed New York City in 1950.10 American Express followed suit by
with the purchase despite his awareness that the tour group was introducing its own charge card to the American market in 1958. 11
waiting for him and his wife. Pantaleon could have prevented the

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In the Philippines, the now defunct Pacific Bank was responsible periodically and may then decide whether to make payment to the
for bringing the first credit card into the country in the 1970s. 12 bank in full within a specified period, free of interest, or to defer
However, it was only in the early 2000s that credit card use gained payment and ultimately incur an interest charge.
wide acceptance in the country, as evidenced by the surge in the We adopted a similar view in CIR v. American Express
number of credit card holders then.13 International, Inc. (Philippine branch),15 where we also recognized
Nature of Credit Card Transactions that credit card issuers are not limited to banks. We said:
To better understand the dynamics involved in credit card Under RA 8484, the credit card that is issued by banks in general,
transactions, we turn to the United States case of Harris Trust & or by non-banks in particular, refers to "any card x x x or other
Savings Bank v. McCray14 which explains: credit device existing for the purpose of obtaining x x x goods x x x
The bank credit card system involves a tripartite relationship or services x x x on credit;" and is being used "usually on a
between the issuer bank, the cardholder, and merchants revolving basis." This means that the consumer-credit arrangement
participating in the system. The issuer bank establishes an that exists between the issuer and the holder of the credit card
account on behalf of the person to whom the card is issued, and enables the latter to procure goods or services "on a continuing
the two parties enter into an agreement which governs their basis as long as the outstanding balance does not exceed a
relationship. This agreement provides that the bank will pay for specified limit." The card holder is, therefore, given "the power to
cardholders account the amount of merchandise or services obtain present control of goods or service on a promise to pay for
purchased through the use of the credit card and will also make them in the future."
cash loans available to the cardholder. It also states that the Business establishments may extend credit sales through the use
cardholder shall be liable to the bank for advances and payments of the credit card facilities of a non-bank credit card company to
made by the bank and that the cardholders obligation to pay the avoid the risk of uncollectible accounts from their customers.
bank shall not be affected or impaired by any dispute, claim, or Under this system, the establishments do not deposit in their bank
demand by the cardholder with respect to any merchandise or accounts the credit card drafts that arise from the credit sales.
service purchased. Instead, they merely record their receivables from the credit card
The merchants participating in the system agree to honor the company and periodically send the drafts evidencing those
banks credit cards. The bank irrevocably agrees to honor and pay receivables to the latter.
the sales slips presented by the merchant if the merchant performs The credit card company, in turn, sends checks as payment to
his undertakings such as checking the list of revoked cards before these business establishments, but it does not redeem the drafts at
accepting the card. x x x. full price. The agreement between them usually provides for
These slips are forwarded to the member bank which originally discounts to be taken by the company upon its redemption of the
issued the card. The cardholder receives a statement from the bank drafts. At the end of each month, it then bills its credit card

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holders for their respective drafts redeemed during the previous holder. Unlike in the Novack and the City Stores cases, however,
month. If the holders fail to pay the amounts owed, the company the cardholder in Gray paid an annual fee for the privilege of being
sustains the loss. an American Express cardholder.
Simply put, every credit card transaction involves three contracts, In our jurisdiction, we generally adhere to the Gray ruling,
namely: (a) the sales contract between the credit card holder and recognizing the relationship between the credit card issuer and the
the merchant or the business establishment which accepted the credit card holder as a contractual one that is governed by the
credit card; (b) the loan agreement between the credit card issuer terms and conditions found in the card membership agreement. 21
and the credit card holder; and lastly, (c) the promise to pay This contract provides the rights and liabilities of a credit card
between the credit card issuer and the merchant or business company to its cardholders and vice versa.
establishment.16 We note that a card membership agreement is a contract of
Credit card issuer cardholder relationship adhesion as its terms are prepared solely by the credit card issuer,
When a credit card company gives the holder the privilege of with the cardholder merely affixing his signature signifying his
charging items at establishments associated with the issuer, 17 a adhesion to these terms.22 This circumstance, however, does not
necessary question in a legal analysis is when does this render the agreement void; we have uniformly held that contracts
relationship begin? There are two diverging views on the matter. In of adhesion are "as binding as ordinary contracts, the reason being
City Stores Co. v. Henderson,18 another U.S. decision, held that: that the party who adheres to the contract is free to reject it
The issuance of a credit card is but an offer to extend a line of open entirely."23 The only effect is that the terms of the contract are
account credit. It is unilateral and supported by no consideration. construed strictly against the party who drafted it. 24
The offer may be withdrawn at any time, without prior notice, for On AMEXs obligations to Pantaleon
any reason or, indeed, for no reason at all, and its withdrawal We begin by identifying the two privileges that Pantaleon assumes
breaches no duty for there is no duty to continue it and violates he is entitled to with the issuance of his AMEX credit card, and on
no rights. which he anchors his claims. First, Pantaleon presumes that since
Thus, under this view, each credit card transaction is considered a his credit card has no pre-set spending limit, AMEX has the
separate offer and acceptance. obligation to approve all his charge requests. Conversely, even if
Novack v. Cities Service Oil Co.19 echoed this view, with the court AMEX has no such obligation, at the very least it is obliged to act
ruling that the mere issuance of a credit card did not create a on his charge requests within a specific period of time.
contractual relationship with the cardholder. i. Use of credit card a mere offer to enter into loan agreements
On the other end of the spectrum is Gray v. American Express Although we recognize the existence of a relationship between the
Company20 which recognized the card membership agreement itself credit card issuer and the credit card holder upon the acceptance
as a binding contract between the credit card issuer and the card by the cardholder of the terms of the card membership agreement

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(customarily signified by the act of the cardholder in signing the made its position clear that it has no obligation to approve any and
back of the credit card), we have to distinguish this contractual all charge requests made by its card holders.
relationship from the creditor-debtor relationship which only arises ii. AMEX not guilty of culpable delay
after the credit card issuer has approved the cardholders purchase Since AMEX has no obligation to approve the purchase requests of
request. The first relates merely to an agreement providing for its credit cardholders, Pantaleon cannot claim that AMEX defaulted
credit facility to the cardholder. The latter involves the actual credit in its obligation. Article 1169 of the Civil Code, which provides the
on loan agreement involving three contracts, namely: the sales requisites to hold a debtor guilty of culpable delay, states:
contract between the credit card holder and the merchant or the Article 1169. Those obliged to deliver or to do something incur in
business establishment which accepted the credit card; the loan delay from the time the obligee judicially or extrajudicially
agreement between the credit card issuer and the credit card demands from them the fulfillment of their obligation. x x x.
holder; and the promise to pay between the credit card issuer and The three requisites for a finding of default are: (a) that the
the merchant or business establishment. obligation is demandable and liquidated; (b) the debtor delays
From the loan agreement perspective, the contractual relationship performance; and (c) the creditor judicially or extrajudicially
begins to exist only upon the meeting of the offer 25 and acceptance requires the debtors performance. 26
of the parties involved. In more concrete terms, when cardholders Based on the above, the first requisite is no longer met because
use their credit cards to pay for their purchases, they merely offer AMEX, by the express terms of the credit card agreement, is not
to enter into loan agreements with the credit card company. Only obligated to approve Pantaleons purchase request. Without a
after the latter approves the purchase requests that the parties demandable obligation, there can be no finding of default.
enter into binding loan contracts, in keeping with Article 1319 of Apart from the lack of any demandable obligation, we also find that
the Civil Code, which provides: Pantaleon failed to make the demand required by Article 1169 of
Article 1319. Consent is manifested by the meeting of the offer and the Civil Code.
the acceptance upon the thing and the cause which are to As previously established, the use of a credit card to pay for a
constitute the contract. The offer must be certain and the purchase is only an offer to the credit card company to enter a loan
acceptance absolute. A qualified acceptance constitutes a counter- agreement with the credit card holder. Before the credit card
offer. issuer accepts this offer, no obligation relating to the loan
This view finds support in the reservation found in the card agreement exists between them. On the other hand, a demand is
membership agreement itself, particularly paragraph 10, which defined as the "assertion of a legal right; xxx an asking with
clearly states that AMEX "reserve[s] the right to deny authority, claiming or challenging as due."27 A demand
authorization for any requested Charge." By so providing, AMEX presupposes the existence of an obligation between the
parties.

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Thus, every time that Pantaleon used his AMEX credit card to pay Edgardo Jaurigue, as well as Pantaleons previous experience). We
for his purchases, what the stores transmitted to AMEX were his come to a different result, however, after a closer look at the factual
offers to execute loan contracts. These obviously could not be and legal circumstances of the case.
classified as the demand required by law to make the debtor in AMEXs credit authorizer, Edgardo Jaurigue, explained that having
default, given that no obligation could arise on the part of AMEX no pre-set spending limit in a credit card simply means that the
until after AMEX transmitted its acceptance of Pantaleons offers. charges made by the cardholder are approved based on his ability
Pantaleons act of "insisting on and waiting for the charge to pay, as demonstrated by his past spending, payment patterns,
purchases to be approved by AMEX" 28 is not the demand and personal resources.29 Nevertheless, every time Pantaleon
contemplated by Article 1169 of the Civil Code. charges a purchase on his credit card, the credit card company
For failing to comply with the requisites of Article 1169, still has to determine whether it will allow this charge, based
Pantaleons charge that AMEX is guilty of culpable delay in on his past credit history. This right to review a card holders
approving his purchase requests must fail. credit history, although not specifically set out in the card
iii. On AMEXs obligation to act on the offer within a specific membership agreement, is a necessary implication of AMEXs right
period of time to deny authorization for any requested charge.
Even assuming that AMEX had the right to review his credit card As for Pantaleons previous experiences with AMEX (i.e., that in the
history before it approved his purchase requests, Pantaleon insists past 12 years, AMEX has always approved his charge requests in
that AMEX had an obligation to act on his purchase requests, three or four seconds), this record does not establish that
either to approve or deny, in "a matter of seconds" or "in timely Pantaleon had a legally enforceable obligation to expect AMEX to
dispatch." Pantaleon impresses upon us the existence of this act on his charge requests within a matter of seconds. For one,
obligation by emphasizing two points: (a) his card has no pre-set Pantaleon failed to present any evidence to support his assertion
spending limit; and (b) in his twelve years of using his AMEX card, that AMEX acted on purchase requests in a matter of three or four
AMEX had always approved his charges in a matter of seconds. seconds as an established practice. More importantly, even if
Pantaleons assertions fail to convince us. Pantaleon did prove that AMEX, as a matter of practice or custom,
We originally held that AMEX was in culpable delay when it acted acted on its customers purchase requests in a matter of seconds,
on the Coster transaction, as well as the two other transactions in this would still not be enough to establish a legally demandable
the United States which took AMEX approximately 15 to 20 right; as a general rule, a practice or custom is not a source of a
minutes to approve. This conclusion appears valid and reasonable legally demandable or enforceable right.30
at first glance, comparing the time it took to finally get the Coster We next examine the credit card membership agreement, the
purchase approved (a total of 78 minutes), to AMEXs "normal" contract that primarily governs the relationship between AMEX
approval time of three to four seconds (based on the testimony of and Pantaleon. Significantly, there is no provision in this

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agreement that obligates AMEX to act on all cardholder cards under conditions of fair and sound consumer credit
purchase requests within a specifically defined period of time. practices. The BSP likewise encourages competition and
Thus, regardless of whether the obligation is worded was to "act in transparency to ensure more efficient delivery of services and fair
a matter of seconds" or to "act in timely dispatch," the fact remains dealings with customers. (Emphasis supplied)
that no obligation exists on the part of AMEX to act within a Based on this Circular, "x x x [b]efore issuing credit cards, banks
specific period of time. Even Pantaleon admits in his testimony that and/or their subsidiary credit card companies must exercise
he could not recall any provision in the Agreement that guaranteed proper diligence by ascertaining that applicants possess good
AMEXs approval of his charge requests within a matter of credit standing and are financially capable of fulfilling their credit
minutes.31 commitments."35 As the above-quoted policy expressly states, the
Nor can Pantaleon look to the law or government issuances as the general intent is to foster "fair and sound consumer credit
source of AMEXs alleged obligation to act upon his credit card practices."
purchases within a matter of seconds. As the following survey of Other than BSP Circular No. 398, a related circular is BSP Circular
Philippine law on credit card transactions demonstrates, the State No. 454, issued on September 24, 2004, but this circular merely
does not require credit card companies to act upon its cardholders enumerates the unfair collection practices of credit card companies
purchase requests within a specific period of time. a matter not relevant to the issue at hand.
Republic Act No. 8484 (RA 8484), or the Access Devices Regulation In light of the foregoing, we find and so hold that AMEX is neither
Act of 1998, approved on February 11, 1998, is the controlling contractually bound nor legally obligated to act on its cardholders
legislation that regulates the issuance and use of access devices, 32 purchase requests within any specific period of time, much less a
including credit cards. The more salient portions of this law period of a "matter of seconds" that Pantaleon uses as his
include the imposition of the obligation on a credit card company standard. The standard therefore is implicit and, as in all
to disclose certain important financial information33 to credit card contracts, must be based on fairness and reasonableness, read in
applicants, as well as a definition of the acts that constitute access relation to the Civil Code provisions on human relations, as will be
device fraud. discussed below.
As financial institutions engaged in the business of providing AMEX acted with good faith
credit, credit card companies fall under the supervisory powers of Thus far, we have already established that: (a) AMEX had neither a
the Bangko Sentral ng Pilipinas (BSP).34 BSP Circular No. 398 contractual nor a legal obligation to act upon Pantaleons
dated August 21, 2003 embodies the BSPs policy when it comes to purchases within a specific period of time; and (b) AMEX has a
credit cards right to review a cardholders credit card history. Our recognition
The Bangko Sentral ng Pilipinas (BSP) shall foster the development of these entitlements, however, does not give AMEX an
of consumer credit through innovative products such as credit unlimited right to put off action on cardholders purchase

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requests for indefinite periods of time. In acting on cardholders limitation on all rights; that in their exercise, the norms of human
purchase requests, AMEX must take care not to abuse its rights conduct set forth in Article 19 must be observed. A right, though
and cause injury to its clients and/or third persons. We cite in this by itself legal because recognized or granted by law as such,
regard Article 19, in conjunction with Article 21, of the Civil Code, may nevertheless become the source of some illegality. When a
which provide: right is exercised in a manner which does not conform with
Article 19. Every person must, in the exercise of his rights and in the norms enshrined in Article 19 and results in damage to
the performance of his duties, act with justice, give everyone his another, a legal wrong is thereby committed for which the
due and observe honesty and good faith. wrongdoer must be held responsible. But while Article 19 lays
Article 21. Any person who willfully causes loss or injury to down a rule of conduct for the government of human relations and
another in a manner that is contrary to morals, good customs or for the maintenance of social order, it does not provide a remedy
public policy shall compensate the latter for the damage. for its violation. Generally, an action for damages under either
Article 19 pervades the entire legal system and ensures that a Article 20 or Article 21 would be proper.
person suffering damage in the course of anothers exercise of right In the context of a credit card relationship, although there is
or performance of duty, should find himself without relief. 36 It sets neither a contractual stipulation nor a specific law requiring the
the standard for the conduct of all persons, whether artificial or credit card issuer to act on the credit card holders offer within a
natural, and requires that everyone, in the exercise of rights and definite period of time, these principles provide the standard by
the performance of obligations, must: (a) act with justice, (b) give which to judge AMEXs actions.
everyone his due, and (c) observe honesty and good faith. It is not According to Pantaleon, even if AMEX did have a right to review his
because a person invokes his rights that he can do anything, even charge purchases, it abused this right when it unreasonably
to the prejudice and disadvantage of another.37 delayed the processing of the Coster charge purchase, as well as
While Article 19 enumerates the standards of conduct, Article 21 his purchase requests at the Richard Metz Golf Studio and Kids
provides the remedy for the person injured by the willful act, an Unlimited Store; AMEX should have known that its failure to act
action for damages. We explained how these two provisions immediately on charge referrals would entail inconvenience and
correlate with each other in GF Equity, Inc. v. Valenzona:38 result in humiliation, embarrassment, anxiety and distress to its
[Article 19], known to contain what is commonly referred to as the cardholders who would be required to wait before closing their
principle of abuse of rights, sets certain standards which must be transactions.39
observed not only in the exercise of one's rights but also in the It is an elementary rule in our jurisdiction that good faith is
performance of one's duties. These standards are the following: to presumed and that the burden of proving bad faith rests upon the
act with justice; to give everyone his due; and to observe honesty party alleging it.40 Although it took AMEX some time before it
and good faith. The law, therefore, recognizes a primordial approved Pantaleons three charge requests, we find no evidence to

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suggest that it acted with deliberate intent to cause Pantaleon any because [Pantaleon] was at that time making his very first
loss or injury, or acted in a manner that was contrary to morals, single charge purchase of US$13,826 [this is below the
good customs or public policy. We give credence to AMEXs claim US$16,112.58 actually billed and paid for by the plaintiff
that its review procedure was done to ensure Pantaleons own because the difference was already automatically approved
protection as a cardholder and to prevent the possibility that the by [AMEX] office in Netherland[s] and the record of
credit card was being fraudulently used by a third person. [Pantaleons] past spending with [AMEX] at that time
Pantaleon countered that this review procedure is primarily does not favorably support his ability to pay for such
intended to protect AMEXs interests, to make sure that the purchase. In fact, if the foregoing internal policy of [AMEX]
cardholder making the purchase has enough means to pay for the had been strictly followed, the transaction would not have
credit extended. Even if this were the case, however, we do not find been approved at all considering that the past spending
any taint of bad faith in such motive. It is but natural for AMEX to pattern of the plaintiff with [AMEX] at that time does not
want to ensure that it will extend credit only to people who will support his ability to pay for such purchase.41
have sufficient means to pay for their purchases. AMEX, after all, xxxx
is running a business, not a charity, and it would simply be Q: Why did it take so long?
ludicrous to suggest that it would not want to earn profit for its A: It took time to review the account on credit, so, if there is
services. Thus, so long as AMEX exercises its rights, performs its any delinquencies [sic] of the cardmember. There are
obligations, and generally acts with good faith, with no intent to factors on deciding the charge itself which are standard
cause harm, even if it may occasionally inconvenience others, it measures in approving the authorization. Now in the case of
cannot be held liable for damages. Mr. Pantaleon although his account is single charge
We also cannot turn a blind eye to the circumstances surrounding purchase of US$13,826. [sic] this is below the US$16,000.
the Coster transaction which, in our opinion, justified the wait. In plus actually billed x x x we would have already declined
Edgardo Jaurigues own words: the charge outright and asked him his bank account to
Q 21: With reference to the transaction at the Coster support his charge. But due to the length of his
Diamond House covered by Exhibit H, also Exhibit 4 for the membership as cardholder we had to make a decision on
defendant, the approval came at 2:19 a.m. after the request hand.42
was relayed at 1:33 a.m., can you explain why the approval As Edgardo Jaurigue clarified, the reason why Pantaleon had to
came after about 46 minutes, more or less? wait for AMEXs approval was because he had to go over
A21: Because we have to make certain considerations and Pantaleons credit card history for the past twelve months. 43 It
evaluations of [Pantaleons] past spending pattern with would certainly be unjust for us to penalize AMEX for merely
[AMEX] at that time before approving plaintiffs request

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exercising its right to review Pantaleons credit history In Nikko Hotel Manila Garden v. Reyes,45 we ruled that a person
meticulously. who knowingly and voluntarily exposes himself to danger cannot
Finally, we said in Garciano v. Court of Appeals that "the right to claim damages for the resulting injury:
recover [moral damages] under Article 21 is based on equity, and The doctrine of volenti non fit injuria ("to which a person assents is
he who comes to court to demand equity, must come with clean not esteemed in law as injury") refers to self-inflicted injury or to
hands. Article 21 should be construed as granting the right to the consent to injury which precludes the recovery of damages by
recover damages to injured persons who are not themselves at one who has knowingly and voluntarily exposed himself to danger,
fault."44 As will be discussed below, Pantaleon is not a blameless even if he is not negligent in doing so.
party in all this. This doctrine, in our view, is wholly applicable to this case.
Pantaleons action was the proximate cause for his injury Pantaleon himself testified that the most basic rule when travelling
Pantaleon mainly anchors his claim for moral and exemplary in a tour group is that you must never be a cause of any delay
damages on the embarrassment and humiliation that he felt when because the schedule is very strict.46 When Pantaleon made up his
the European tour group had to wait for him and his wife for mind to push through with his purchase, he must have known
approximately 35 minutes, and eventually had to cancel the that the group would become annoyed and irritated with him. This
Amsterdam city tour. After thoroughly reviewing the records of this was the natural, foreseeable consequence of his decision to make
case, we have come to the conclusion that Pantaleon is the them all wait.
proximate cause for this embarrassment and humiliation. We do not discount the fact that Pantaleon and his family did feel
As borne by the records, Pantaleon knew even before entering humiliated and embarrassed when they had to wait for AMEX to
Coster that the tour group would have to leave the store by 9:30 approve the Coster purchase in Amsterdam. We have to
a.m. to have enough time to take the city tour of Amsterdam before acknowledge, however, that Pantaleon was not a helpless victim in
they left the country. After 9:30 a.m., Pantaleons son, who had this scenario at any time, he could have cancelled the sale so that
boarded the bus ahead of his family, returned to the store to the group could go on with the city tour. But he did not.
inform his family that they were the only ones not on the bus and More importantly, AMEX did not violate any legal duty to Pantaleon
that the entire tour group was waiting for them. Significantly, under the circumstances under the principle of damnum absque
Pantaleon tried to cancel the sale at 9:40 a.m. because he did not injuria, or damages without legal wrong, loss without injury.47 As
want to cause any inconvenience to the tour group. However, when we held in BPI Express Card v. CA:48
Costers sale manager asked him to wait a few more minutes for We do not dispute the findings of the lower court that private
the credit card approval, he agreed, despite the knowledge that he respondent suffered damages as a result of the cancellation of his
had already caused a 10-minute delay and that the city tour could credit card. However, there is a material distinction between
not start without him. damages and injury. Injury is the illegal invasion of a legal right;

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damage is the loss, hurt, or harm which results from the injury; As previously discussed, it took AMEX some time to approve
and damages are the recompense or compensation awarded for the Pantaleons purchase requests because it had legitimate concerns
damage suffered. Thus, there can be damage without injury in on the amount being charged; no malicious intent was ever
those instances in which the loss or harm was not the result of a established here. In the absence of any other damages, the award
violation of a legal duty. In such cases, the consequences must be of exemplary damages clearly lacks legal basis.1avvphi1
borne by the injured person alone, the law affords no remedy for Neither do we find any basis for the award of attorneys fees and
damages resulting from an act which does not amount to a legal costs of litigation. No premium should be placed on the right to
injury or wrong. These situations are often called damnum absque litigate and not every winning party is entitled to an automatic
injuria. grant of attorney's fees.51 To be entitled to attorneys fees and
In other words, in order that a plaintiff may maintain an action for litigation costs, a party must show that he falls under one of the
the injuries of which he complains, he must establish that such instances enumerated in Article 2208 of the Civil Code. 52 This,
injuries resulted from a breach of duty which the defendant owed Pantaleon failed to do. Since we eliminated the award of moral and
to the plaintiff - a concurrence of injury to the plaintiff and legal exemplary damages, so must we delete the award for attorney's
responsibility by the person causing it. The underlying basis for fees and litigation expenses.
the award of tort damages is the premise that an individual was Lastly, although we affirm the result of the CA decision, we do so
injured in contemplation of law. Thus, there must first be a breach for the reasons stated in this Resolution and not for those found in
of some duty and the imposition of liability for that breach before the CA decision.
damages may be awarded; and the breach of such duty should be WHEREFORE, premises considered, we SET ASIDE our May 8,
the proximate cause of the injury. 2009 Decision and GRANT the present motion for reconsideration.
Pantaleon is not entitled to damages The Court of Appeals Decision dated August 18, 2006 is hereby
Because AMEX neither breached its contract with Pantaleon, nor AFFIRMED. No costs.
acted with culpable delay or the willful intent to cause harm, we SO ORDERED.
find the award of moral damages to Pantaleon unwarranted.
Similarly, we find no basis to award exemplary damages. In
contracts, exemplary damages can only be awarded if a defendant
acted "in a wanton, fraudulent, reckless, oppressive or malevolent
manner."49 The plaintiff must also show that he is entitled to
moral, temperate, or compensatory damages before the court may
consider the question of whether or not exemplary damages should
be awarded.50

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Republic of the Philippines On October 19, 1981, the Board concluded that the loss of the F/B
SUPREME COURT Marjolea and its fish catch was attributable to the negligence of the
Manila employees of the private respondent who were on board the M/V
FIRST DIVISION Asia Philippines during the collision. The findings made by the
G.R. No. L-83524 October 13, 1989 Board served as the basis of a subsequent Decision of the
ERNESTO KRAMER, JR. and MARIA KRAMER, petitioners, Commandant of the Philippine Coast Guard dated April 29, 1982
vs. wherein the second mate of the M/V Asia Philippines was
HON. COURT OF APPEALS and TRANS-ASIA SHIPPING LINES, suspended from pursuing his profession as a marine officer. 1
INC., respondents. On May 30, 1985, the petitioners instituted a Complaint for
Rodolfo D. Mapile for petitioners. damages against the private respondent before Branch 117 of the
Jose Al. Perez for private respondent. Regional Trial Court in Pasay City. 2 The suit was docketed as Civil
Case No. 2907-P.
GANCAYCO, J.: The private respondent filed a Motion seeking the dismissal of the
The principal issue in this Petition for Review is whether or not a Complaint on the ground of prescription. He argued that under
Complaint for damages instituted by the petitioners against the Article 1146 of the Civil Code, 3 the prescriptive period for
private respondent arising from a marine collision is barred by the instituting a Complaint for damages arising from a quasi-delict like
statute of limitations. a maritime collision is four years. He maintained that the
The record of the case discloses that in the early morning of April petitioners should have filed their Complaint within four years from
8, 1976, the F/B Marjolea, a fishing boat owned by the petitioners the date when their cause of action accrued, i.e., from April 8, 1976
Ernesto Kramer, Jr. and Marta Kramer, was navigating its way when the maritime collision took place, and that accordingly, the
from Marinduque to Manila. Somewhere near Maricabon Island Complaint filed on May 30, 1985 was instituted beyond the four-
and Cape Santiago, the boat figured in a collision with an inter- year prescriptive period.
island vessel, the M/V Asia Philippines owned by the private For their part, the petitioners contended that maritime collisions
respondent Trans-Asia Shipping Lines, Inc. As a consequence of have peculiarities and characteristics which only persons with
the collision, the F/B Marjolea sank, taking with it its fish catch. special skill, training and experience like the members of the Board
After the mishap, the captains of both vessels filed their respective of Marine Inquiry can properly analyze and resolve. The petitioners
marine protests with the Board of Marine Inquiry of the Philippine argued that the running of the prescriptive period was tolled by the
Coast Guard. The Board conducted an investigation for the filing of the marine protest and that their cause of action accrued
purpose of determining the proximate cause of the maritime only on April 29, 1982, the date when the Decision ascertaining the
collision. negligence of the crew of the M/V Asia Philippines had become

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final, and that the four-year prescriptive period under Article 1146 1. Board of Marine
of the Civil Code should be computed from the said date. The Inquiry (BMI) Shall
petitioners concluded that inasmuch as the Complaint was filed on have the jurisdiction to
May 30, 1985, the same was seasonably filed. investigate marine
In an Order dated September 25, 1986, 4 the trial court denied the accidents or casualties
Motion filed by the private respondent. The trial court observed relative to the liability
that in ascertaining negligence relating to a maritime collision, of shipowners and
there is a need to rely on highly technical aspects attendant to officers, exclusive
such collision, and that the Board of Marine Inquiry was jurisdiction to
constituted pursuant to the Philippine Merchant Marine Rules and investigate
Regulations, which took effect on January 1, 1975 by virtue of cases/complaints
Letter of Instruction No. 208 issued on August 12, 1974 by then against the marine
President Ferdinand E. Marcos, precisely to answer the need. The officers; and to review
trial court went on to say that the four-year prescriptive period all proceedings or
provided in Article 1146 of the Civil Code should begin to run only investigation
from April 29, 1982, the date when the negligence of the crew of conducted by the
the M/V Asia Philippines had been finally ascertained. The Special Boards of
pertinent portions of the Order of the trial court are as follows Marine Inquiry.
Considering that the action concerns an incident 2. Special Board of
involving a collision at sea of two vehicles and to Marine Inquiry. Shall
determine negligence for that incident there is an have original
absolute need to rely on highly technical aspects jurisdiction to
attendant to such collisions. It is obviously to investigate marine
answer such a need that the Marine Board of casualties and
Inquiry (Sic) was constituted pursuant to the disasters which occur
Philippine Merchant Marine Rules and Regulations or are committed
which became effective January 1, 1975 under within the limits of the
Letter of Instruction(s) No. 208 dated August 12, Coast Guard District
1974. The relevant section of that law (Art. XVI/b/ concerned or those
provided as follow(s):

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referred by the damages were inflicted upon and sustained by the
Commandant. aggrieved party and from which relief from the court
The Court finds reason in the argument of the is presently sought. Private respondents should
plaintiff that marine incidents have those have immediately instituted a complaint for
'peculiarities which only persons of special skill, damages based on a quasi-delict within four years
training and exposure can rightfully decipher and from the said marine incident because its cause of
resolve on the matter of the negligence and liabilities action had already definitely ripened at the onset of
of parties involved and inasmuch as the report of the collision. For this reason, he (sic) could cite the
the Board of Inquiry (sic) admittedly came out only negligence on the part of the personnel of the
on April 29, 1982, the prescriptive period provided x petitioner to exercise due care and lack of (sic)
x x under Art. 1146 of the Civil Code should begin to diligence to prevent the collision that resulted in the
run only from that date. The complaint was filed total loss of their x x x boat.
with this Court on May 10, 1985, hence the statute We can only extend scant consideration to
of limitations can not constitute a bar to the filing of respondent judge's reasoning that in view of the
this case. 5 nature of the marine collision that allegedly involves
The private respondent elevated the case to the Court of Appeals by highly technical aspects, the running of the
way of a special civil action for certiorari and prohibition, alleging prescriptive period should only commence from the
therein that the trial court committed a grave abuse of discretion in finality of the investigation conducted by the Marine
refusing to dismiss the Complaint filed by the petitioners. The case Board of Inquiry (sic) and the decision of the
was assigned to the Second Division of the appellate court and was Commandant, Philippine Coast Guard, who has
docketed as Case No. CA-G.R. SP No. 12032. 6 original jurisdiction over the mishap. For one, while
In a Decision dated November 27, 1987, 7 and clarified in a it is true that the findings and recommendation of
Resolution dated January 12, 1988, 8 the Court of Appeals granted the Board and the decision of the Commandant may
the Petition filed by the private respondent and ordered the trial be helpful to the court in ascertaining which of the
court to dismiss the Complaint. The pertinent portions of the parties are at fault, still the former (court) is not
Decision of the appellate court are as follows bound by said findings and decision. Indeed, the
It is clear that the cause of action of private same findings and decision could be entirely or
respondent (the herein petitioners Ernesto Kramer, partially admitted, modified, amended, or
Jr. and Marta Kramer) accrued from the occurrence disregarded by the court according to its lights and
of the mishap because that is the precise time when judicial discretion. For another, if the accrual of a

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cause of action will be made to depend on the action within four (4) years. The prescriptive period begins from the day
to be taken by certain government agencies, then the quasi-delict is committed. In Paulan vs. Sarabia, 16 this Court
necessarily, the tolling of the prescriptive period ruled that in an action for damages arising from the collision of two
would hinge upon the discretion of such agencies. (2) trucks, the action being based on a quasi-delict, the four (4)
Said alternative it is easy to foresee would be year prescriptive period must be counted from the day of the
fraught with hazards. Their investigations might be collision.
delayed and lag and then witnesses in the meantime In Espanol vs. Chairman, Philippine Veterans Administration, 17 this
might not be available or disappear, or certain Court held as follows-
documents may no longer be available or might be The right of action accrues when there exists a
mislaid. ... 9 cause of action, which consists of 3 elements,
The petitioners filed a Motion for the reconsideration of the said namely: a) a right in favor of the plaintiff by
Decision but the same was denied by the Court of Appeals in a whatever means and under whatever law it arises or
Resolution dated May 27, 1988. 10 is created; b) an obligation on the part of defendant
Hence, the instant Petition wherein the arguments raised by the to respect such right; and c) an act or omission on
petitioner before the trial court are reiterated. 11 In addition the part of such defendant violative of the right of
thereto, the petitioner contends that the Decision of the Court of the plaintiff ... It is only when the last element
Appeals 12 The private respondent filed its Comment on the Petition occurs or takes place that it can be said in law that
seeking therein the dismissal of the same. 13 It is also contended by a cause of action has arisen ... .
the private respondent that the ruling of the Court in Vasquez is From the foregoing ruling, it is clear that the prescriptive period
not applicable to the case at bar because the said case involves a must be counted when the last element occurs or takes place, that
maritime collision attributable to a fortuitous event. In a is, the time of the commission of an act or omission violative of the
subsequent pleading, the private respondent argues that the right of the plaintiff, which is the time when the cause of action
Philippine Merchant Marine Rules and Regulations cannot have arises.
the effect of repealing the provisions of the Civil Code on It is therefore clear that in this action for damages arising from the
prescription of actions. 14 collision of two (2) vessels the four (4) year prescriptive period must
On September 19,1988, the Court resolved to give due course to be counted from the day of the collision. The aggrieved party need
the petition. 15 After the parties filed their respective memoranda, not wait for a determination by an administrative body like a Board
the case was deemed submitted for decision. of Marine Inquiry, that the collision was caused by the fault or
The petition is devoid of merit. Under Article 1146 of the Civil negligence of the other party before he can file an action for
Code, an action based upon a quasi-delict must be instituted damages. The ruling in Vasquez does not apply in this case.

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Immediately after the collision the aggrieved party can seek relief
from the courts by alleging such negligence or fault of the owners,
agents or personnel of the other vessel.
Thus, the respondent court correctly found that the action of
petitioner has prescribed. The collision occurred on April 8, 1976.
The complaint for damages was filed iii court only on May 30, 1
985, was beyond the four (4) year prescriptive period.
WHEREFORE, the petition is dismissed. No costs.
SO ORDERED.

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Republic of the Philippines turtle. Some of the passengers managed to leave the bus the best
SUPREME COURT way they could, others had to be helped or pulled out, while the
Manila three passengers seated beside the driver, named Bataclan, Lara
EN BANC and the Visayan and the woman behind them named Natalia
G.R. No. L-10126 October 22, 1957 Villanueva, could not get out of the overturned bus. Some of the
SALUD VILLANUEVA VDA. DE BATACLAN and the minors passengers, after they had clambered up to the road, heard groans
NORMA, LUZVIMINDA, ELENITA, OSCAR and ALFREDO and moans from inside the bus, particularly, shouts for help from
BATACLAN, represented by their Natural guardian, SALUD Bataclan and Lara, who said they could not get out of the bus.
VILLANUEVA VDA. DE BATACLAN, plaintiffs-appellants, There is nothing in the evidence to show whether or not the
vs. passengers already free from the wreck, including the driver and
MARIANO MEDINA, defendant-appellant. the conductor, made any attempt to pull out or extricate and
Lope E. Adriano, Emmanuel Andamo and Jose R. Francisco for rescue the four passengers trapped inside the vehicle, but calls or
plaintiffs-appellants. shouts for help were made to the houses in the neighborhood. After
Fortunato Jose for defendant and appellant. half an hour, came about ten men, one of them carrying a lighted
MONTEMAYOR, J.: torch made of bamboo with a wick on one end, evidently fueled
Shortly after midnight, on September 13, 1952 bus no. 30 of the with petroleum. These men presumably approach the overturned
Medina Transportation, operated by its owner defendant Mariano bus, and almost immediately, a fierce fire started, burning and all
Medina under a certificate of public convenience, left the town of but consuming the bus, including the four passengers trapped
Amadeo, Cavite, on its way to Pasay City, driven by its regular inside it. It would appear that as the bus overturned, gasoline
chauffeur, Conrado Saylon. There were about eighteen passengers, began to leak and escape from the gasoline tank on the side of the
including the driver and conductor. Among the passengers were chassis, spreading over and permeating the body of the bus and
Juan Bataclan, seated beside and to the right of the driver, Felipe the ground under and around it, and that the lighted torch brought
Lara, sated to the right of Bataclan, another passenger apparently by one of the men who answered the call for help set it on fire.
from the Visayan Islands whom the witnesses just called Visaya, That same day, the charred bodies of the four deemed passengers
apparently not knowing his name, seated in the left side of the inside the bus were removed and duly identified that of Juan
driver, and a woman named Natalia Villanueva, seated just behind Bataclan. By reason of his death, his widow, Salud Villanueva, in
the four last mentioned. At about 2:00 o'clock that same morning, her name and in behalf of her five minor children, brought the
while the bus was running within the jurisdiction of Imus, Cavite, present suit to recover from Mariano Medina compensatory, moral,
one of the front tires burst and the vehicle began to zig-zag until it and exemplary damages and attorney's fees in the total amount of
fell into a canal or ditch on the right side of the road and turned P87,150. After trial, the Court of First Instance of Cavite awarded

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P1,000 to the plaintiffs plus P600 as attorney's fee, plus P100, the of the former's employees, although such employees may
value of the merchandise being carried by Bataclan to Pasay City have acted beyond the scope of their authority or in
for sale and which was lost in the fire. The plaintiffs and the violation of the order of the common carriers.
defendants appealed the decision to the Court of Appeals, but the This liability of the common carriers does not cease upon
latter endorsed the appeal to us because of the value involved in proof that they exercised all the diligence of a good father of
the claim in the complaint. a family in the selection and supervision of their employees.
Our new Civil Code amply provides for the responsibility of ART. 1763. A common carrier responsible for injuries
common carrier to its passengers and their goods. For purposes of suffered by a passenger on account of the willful acts or
reference, we are reproducing the pertinent codal provisions: negligence of other passengers or of strangers, if the
ART. 1733. Common carriers, from the nature of their common carrier's employees through the exercise of the
business and for reasons of public policy, are bound to diligence of a good father of a family could have prevented
observe extraordinary diligence in the vigilance over the or stopped the act or omission.
goods and for the safety of the passengers transported by We agree with the trial court that the case involves a breach of
them, according to all the circumstances of each case. contract of transportation for hire, the Medina Transportation
Such extraordinary diligence in the vigilance over the goods having undertaken to carry Bataclan safely to his destination,
is further expressed in articles 1734, 1735, and 1745, Nos. Pasay City. We also agree with the trial court that there was
5, 6, and 7, while the extra ordinary diligence for the safety negligence on the part of the defendant, through his agent, the
of the passengers is further set forth in articles 1755 and driver Saylon. There is evidence to show that at the time of the
1756. blow out, the bus was speeding, as testified to by one of the
ART. 1755. A common carrier is bound to carry the passengers, and as shown by the fact that according to the
passengers safely as far as human care and foresight can testimony of the witnesses, including that of the defense, from the
provide, using the utmost diligence of very cautious point where one of the front tires burst up to the canal where the
persons, with a due regard for all the circumstances. bus overturned after zig-zaging, there was a distance of about 150
ART. 1756. In case of death of or injuries to passengers, meters. The chauffeur, after the blow-out, must have applied the
common carriers are presumed to have been at fault or to brakes in order to stop the bus, but because of the velocity at
have acted negligently, unless they prove that they observed which the bus must have been running, its momentum carried it
extraordinary diligence as prescribed in articles 1733 and over a distance of 150 meters before it fell into the canal and
1755 turned turtle.
ART. 1759. Common carriers are liable for the death of or There is no question that under the circumstances, the defendant
injuries to passengers through the negligence or willful acts carrier is liable. The only question is to what degree. The trial court

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was of the opinion that the proximate cause of the death of looting the vehicle sets it on fire, and the passenger is burned to
Bataclan was not the overturning of the bus, but rather, the fire death, one might still contend that the proximate cause of his
that burned the bus, including himself and his co-passengers who death was the fire and not the overturning of the vehicle. But in the
were unable to leave it; that at the time the fire started, Bataclan, present case under the circumstances obtaining in the same, we do
though he must have suffered physical injuries, perhaps serious, not hesitate to hold that the proximate cause was the overturning
was still alive, and so damages were awarded, not for his death, of the bus, this for the reason that when the vehicle turned not
but for the physical injuries suffered by him. We disagree. A only on its side but completely on its back, the leaking of the
satisfactory definition of proximate cause is found in Volume 38, gasoline from the tank was not unnatural or unexpected; that the
pages 695-696 of American jurisprudence, cited by plaintiffs- coming of the men with a lighted torch was in response to the call
appellants in their brief. It is as follows: for help, made not only by the passengers, but most probably, by
. . . 'that cause, which, in natural and continuous the driver and the conductor themselves, and that because it was
sequence, unbroken by any efficient intervening cause, dark (about 2:30 in the morning), the rescuers had to carry a light
produces the injury, and without which the result would with them, and coming as they did from a rural area where
not have occurred.' And more comprehensively, 'the lanterns and flashlights were not available; and what was more
proximate legal cause is that acting first and producing the natural than that said rescuers should innocently approach the
injury, either immediately or by setting other events in vehicle to extend the aid and effect the rescue requested from
motion, all constituting a natural and continuous chain of them. In other words, the coming of the men with a torch was to be
events, each having a close causal connection with its expected and was a natural sequence of the overturning of the bus,
immediate predecessor, the final event in the chain the trapping of some of its passengers and the call for outside help.
immediately effecting the injury as a natural and probable What is more, the burning of the bus can also in part be attributed
result of the cause which first acted, under such to the negligence of the carrier, through is driver and its conductor.
circumstances that the person responsible for the first According to the witness, the driver and the conductor were on the
event should, as an ordinary prudent and intelligent road walking back and forth. They, or at least, the driver should
person, have reasonable ground to expect at the moment of and must have known that in the position in which the overturned
his act or default that an injury to some person might bus was, gasoline could and must have leaked from the gasoline
probably result therefrom. tank and soaked the area in and around the bus, this aside from
It may be that ordinarily, when a passenger bus overturns, and the fact that gasoline when spilled, specially over a large area, can
pins down a passenger, merely causing him physical injuries, if be smelt and directed even from a distance, and yet neither the
through some event, unexpected and extraordinary, the overturned driver nor the conductor would appear to have cautioned or taken
bus is set on fire, say, by lightning, or if some highwaymen after steps to warn the rescuers not to bring the lighted torch too near

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the bus. Said negligence on the part of the agents of the carrier operated and drove his vehicle negligently, resulting in the death of
come under the codal provisions above-reproduced, particularly, four of his passengers, physical injuries to others, and the
Articles 1733, 1759 and 1763. complete loss and destruction of their goods, and yet the criminal
As regard the damages to which plaintiffs are entitled, considering case against him, on motion of the fiscal and with his consent, was
the earning capacity of the deceased, as well as the other elements provisionally dismissed, because according to the fiscal, the
entering into a damage award, we are satisfied that the amount of witnesses on whose testimony he was banking to support the
SIX THOUSAND (P6,000) PESOS would constitute satisfactory complaint, either failed or appear or were reluctant to testify. But
compensation, this to include compensatory, moral, and other the record of the case before us shows the several witnesses,
damages. We also believe that plaintiffs are entitled to attorney's passengers, in that bus, willingly and unhesitatingly testified in
fees, and assessing the legal services rendered by plaintiffs' court to the effect of the said driver was negligent. In the public
attorneys not only in the trial court, but also in the course of the interest the prosecution of said erring driver should be pursued,
appeal, and not losing sight of the able briefs prepared by them, this, not only as a matter of justice, but for the promotion of the
the attorney's fees may well be fixed at EIGHT HUNDRED (P800) safety of passengers on public utility buses. Let a copy of this
PESOS for the loss of merchandise carried by the deceased in the decision be furnished the Department of Justice and the Provincial
bus, is adequate and will not be disturbed. Fiscal of Cavite.
There is one phase of this case which disturbs if it does not shock In view of the foregoing, with the modification that the damages
us. According to the evidence, one of the passengers who, because awarded by the trial court are increased from ONE THOUSAND
of the injuries suffered by her, was hospitalized, and while in the (P1,000) PESOS TO SIX THOUSAND (P6,000) PESOS, and from SIX
hospital, she was visited by the defendant Mariano Medina, and in HUNDRED PESOS TO EIGHT HUNDRED (P800) PESOS, for the
the course of his visit, she overheard him speaking to one of his death of Bataclan and for the attorney's fees, respectively, the
bus inspectors, telling said inspector to have the tires of the bus decision appealed is from hereby affirmed, with costs.
changed immediately because they were already old, and that as a
matter of fact, he had been telling the driver to change the said
tires, but that the driver did not follow his instructions. If this be
true, it goes to prove that the driver had not been diligent and had
not taken the necessary precautions to insure the safety of his
passengers. Had he changed the tires, specially those in front, with
new ones, as he had been instructed to do, probably, despite his
speeding, as we have already stated, the blow out would not have
occurred. All in all, there is reason to believe that the driver

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Republic of the Philippines November 6, 1993 at 9:00 p.m., November 7 at 6:00 a.m., and
SUPREME COURT November 8 at 7:30 a.m.
Manila On November 8 or on the third day he took the medicine,
FIRST DIVISION respondent figured in a vehicular accident. The car he was driving
G.R. No. 156037 May 28, 2007 collided with the car of one Josie Peralta. Respondent fell asleep
MERCURY DRUG CORPORATION, Petitioner, while driving. He could not remember anything about the collision
vs. nor felt its impact.
SEBASTIAN M. BAKING, Respondent. Suspecting that the tablet he took may have a bearing on his
DECISION physical and mental state at the time of the collision, respondent
SANDOVAL-GUTIERREZ, J.: returned to Dr. Sys clinic. Upon being shown the medicine, Dr. Sy
For our resolution is the instant Petition for Review on Certiorari1 was shocked to find that what was sold to respondent was
assailing the Decision2 dated May 30, 2002 and Resolution dated Dormicum, instead of the prescribed Diamicron.
November 5, 2002 of the Court of Appeals in CA-G.R. CV No. Thus, on April 14, 1994, respondent filed with the Regional Trial
57435, entitled "Sebastian M. Baking, plaintiff-appellee, versus Court (RTC), Branch 80 of Quezon City a complaint for damages
Mercury Drug Co. Inc., defendant-appellant." against petitioner, docketed as Civil Case No. Q-94-20193.
The facts are: After hearing, the trial court rendered its Decision dated March 18,
On November 25, 1993, Sebastian M. Baking, respondent, went to 1997 in favor of respondent, thus:
the clinic of Dr. Cesar Sy for a medical check-up. On the following WHEREFORE, premises considered, by preponderance of evidence,
day, after undergoing an ECG, blood, and hematology the Court hereby renders judgment in favor of the plaintiff and
examinations and urinalysis, Dr. Sy found that respondents blood against the defendant ordering the latter to pay mitigated damages
sugar and triglyceride were above normal levels. Dr. Sy then gave as follows:
respondent two medical prescriptions Diamicron for his blood 1. P250,000.00 as moral damages;
sugar and Benalize tablets for his triglyceride. 2. P20,000.00 as attorneys fees and litigation expenses;
Respondent then proceeded to petitioner Mercury Drug 3. plus % of the cost of the suit.
Corporation (Alabang Branch) to buy the prescribed medicines. SO ORDERED.
However, the saleslady misread the prescription for Diamicron as a On appeal, the Court of Appeals, in its Decision, affirmed in toto
prescription for Dormicum. Thus, what was sold to respondent was the RTC judgment. Petitioner filed a motion for reconsideration but
Dormicum, a potent sleeping tablet. it was denied in a Resolution dated November 5, 2002.
Unaware that what was given to him was the wrong medicine, Hence, this petition.
respondent took one pill of Dormicum on three consecutive days

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Petitioner contends that the Decision of the Court of Appeals is not Considering that a fatal mistake could be a matter of life and death
in accord with law or prevailing jurisprudence. for a buying patient, the said employee should have been very
Respondent, on the other hand, maintains that the petition lacks cautious in dispensing medicines. She should have verified
merit and, therefore, should be denied. whether the medicine she gave respondent was indeed the one
The issues for our resolution are: prescribed by his physician. The care required must be
1. Whether petitioner was negligent, and if so, whether such commensurate with the danger involved, and the skill employed
negligence was the proximate cause of respondents must correspond with the superior knowledge of the business
accident; and which the law demands.41awphi1.nt
2. Whether the award of moral damages, attorneys fees, Petitioner contends that the proximate cause of the accident was
litigation expenses, and cost of the suit is justified. respondents negligence in driving his car.
Article 2176 of the New Civil Code provides: We disagree.
Art. 2176. Whoever by act or omission causes damage to another, Proximate cause is defined as any cause that produces injury in a
there being fault or negligence, is obliged to pay for the damage natural and continuous sequence, unbroken by any efficient
done. Such fault or negligence, if there is no pre-existing intervening cause, such that the result would not have occurred
contractual relation between the parties, is called a quasi-delict otherwise. Proximate cause is determined from the facts of each
and is governed by the provisions of this Chapter. case, upon a combined consideration of logic, common sense,
To sustain a claim based on the above provision, the following policy, and precedent.5
requisites must concur: (a) damage suffered by the plaintiff; (b) Here, the vehicular accident could not have occurred had
fault or negligence of the defendant; and, (c) connection of cause petitioners employee been careful in reading Dr. Sys prescription.
and effect between the fault or negligence of the defendant and the Without the potent effects of Dormicum, a sleeping tablet, it was
damage incurred by the plaintiff.3 unlikely that respondent would fall asleep while driving his car,
There is no dispute that respondent suffered damages. resulting in a collision.
It is generally recognized that the drugstore business is imbued Complementing Article 2176 is Article 2180 of the same Code
with public interest. The health and safety of the people will be put which states:
into jeopardy if drugstore employees will not exercise the highest ART. 2180. The obligation imposed by Article 2176 is demandable
degree of care and diligence in selling medicines. Inasmuch as the not only for ones own acts or omissions, but also for those of
matter of negligence is a question of fact, we defer to the findings of persons for whom one is responsible.
the trial court affirmed by the Court of Appeals. xxx
Obviously, petitioners employee was grossly negligent in selling to The owners and managers of an establishment or enterprise are
respondent Dormicum, instead of the prescribed Diamicron. likewise responsible for damages caused by their employees in the

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service of the branches in which the latter are employed or on the Respondent has adequately established the factual basis for the
occasion of their functions. award of moral damages when he testified that he suffered mental
Employers shall be liable for the damages caused by their anguish and anxiety as a result of the accident caused by the
employees and household helpers acting within the scope of their negligence of petitioners employee.
assigned tasks, even though the former are not engaged in any There is no hard-and-fast rule in determining what would be a fair
business or industry. and reasonable amount of moral damages, since each case must be
xxx governed by its own peculiar facts. However, it must be
The responsibility treated of in this article shall cease when the commensurate to the loss or injury suffered.8 Taking into
persons herein mentioned prove that they observed the diligence of consideration the attending circumstances here, we are convinced
a good father of a family to prevent damage. that the amount awarded by the trial court is exorbitant. Thus, we
It is thus clear that the employer of a negligent employee is liable reduce the amount of moral damages from P250,000.00 to
for the damages caused by the latter. When an injury is caused by P50,000.00 only.
the negligence of an employee, there instantly arises a presumption In addition, we also deem it necessary to award exemplary
of the law that there has been negligence on the part of the damages. Article 2229 allows the grant of exemplary damages by
employer, either in the selection of his employee or in the way of example or correction for the public good. As mentioned
supervision over him, after such selection. The presumption, earlier, the drugstore business is affected with public interest.
however, may be rebutted by a clear showing on the part of the Petitioner should have exerted utmost diligence in the selection
employer that he has exercised the care and diligence of a good and supervision of its employees. On the part of the employee
father of a family in the selection and supervision of his employee.6 concerned, she should have been extremely cautious in dispensing
Here, petitioner's failure to prove that it exercised the due diligence pharmaceutical products. Due to the sensitive nature of its
of a good father of a family in the selection and supervision of its business, petitioner must at all times maintain a high level of
employee will make it solidarily liable for damages caused by the meticulousness. Therefore, an award of exemplary damages in the
latter. amount of P25,000.00 is in order.1awphi1.nt
As regards the award of moral damages, we hold the same to be in On the matter of attorneys fees and expenses of litigation, it is
order. Moral damages may be awarded whenever the defendants settled that the reasons or grounds for the award thereof must be
wrongful act or omission is the proximate cause of the plaintiffs set forth in the decision of the court.9 Since the trial courts
physical suffering, mental anguish, fright, serious anxiety, decision did not give the basis of the award, the same must be
besmirched reputation, wounded feelings, moral shock, social deleted. In Vibram Manufacturing Corporation v. Manila Electric
humiliation, and similar injury in the cases specified or analogous Company,10 we held:
to those provided in Article 2219 of the Civil Code.7

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Likewise, the award for attorneys fees and litigation expenses
should be deleted. Well-enshrined is that "an award for attorneys
fees must be stated in the text of the courts decision and not in
the dispositive portion only" (Consolidated Bank and Trust
Corporation (Solidbank) v. Court of Appeals, 246 SCRA 193 [1995]
and Keng Hua Paper Products, Inc. v. Court of Appeals, 286 SCRA
257 [1998]). This is also true with the litigation expenses where the
body of the decision discussed nothing for its basis.
WHEREFORE, we DENY the petition. The challenged Decision and
Resolution of the Court of Appeals in CA-G.R. CV No. 57435 are
AFFIRMED with modification in the sense that (a) the award of
moral damages to respondent is reduced from P250,000.00 to
P50,000.00; (b) petitioner is likewise ordered to pay said
respondent exemplary damages in the amount of P25,000.00; and
(c) the award of attorneys fees and litigation expenses is deleted.
Costs against petitioner.
SO ORDERED.

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Republic of the Philippines Pilipinas Bank (then Filman Bank), Bian Branch.
SUPREME COURT Roberto Santos was requested to make the deposit.
Manila In depositing in the name of FLORENCIO REYES, he
SECOND DIVISION inquired from the teller the current account number
of Florencio Reyes to complete the deposit slip he
G.R. No. 105410 July 25, 1994 was accomplishing. He was informed that it was
PILIPINAS BANK, petitioner, "815" and so this was the same current account
vs. number he placed on the deposit slip below the
HON. COURT OF APPEALS AND FLORENCIO REYES, depositor's name FLORENCIO REYES.
respondents. Nothing that the account number coincided with the
Gella Reyes Danguilan & Associates for petitioner. name Florencio, Efren Alagasi, then Current
Santos V. Pampolina, Jr. for private respondent. Account Bookkeeper of Pilipinas Bank, thought it
was for Florencio Amador who owned the listed
PUNO, J.: account number. He, thus, posted the deposted in
This is a petition for review of the Decision of the respondent court the latter's account not noticing that the depositor's
1 in CA-G.R. CV No. 29524 dated May 13, 1992 which ordered surname in the deposit slip was REYES.
petitioner to pay the private respondent the sum of P50,000.00 as On October 11, 1979, the October 10, check in favor
moral damages, P25,000.00 as attorney's fees and cost of suit. of Winner Industrial Corporation was presented for
The facts as found both by the trial court 2 and the respondent payment. Since the ledger of Florencio Reyes
court are: indicated that his account had only a balance of
As payments for the purchased shoe materials and P4,078.43, it was dishonored and the payee was
rubber shoes, Florencio Reyes issued postdated advised to try it for next clearing.
checks to Winner Industrial Corporation for On October 15, 1979, the October 10, 1979 check
P20,927.00 and Vicente Tui, for P11,419.50, with was redeposited but was again dishonored.
due dates on October 10 and 12, 1979, respectively. Likewise, the October 12, 1979 check in favor of
To cover the face value of the checks, plaintiff, on Vicente Tui when presented for payment on that
October 10, 1979, requested PCIB Money Shop's same date met the same fate but was advised to try
manager Mike Potenciano to effect the withdrawal of the next clearing. Two days after the October 10
P32,000.00 from his savings account therein and check was again dishonored, the payee returned the
have it deposited with his current account with same to Florencio Reyes and demanded a cash

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payment of its face value which he did if only to save right to recover moral damages and in awarding the
his name. The October 12, 1979 check was amount of P50,000.00, when there is no legal nor
redeposited on October 18, 1979, but again factual basis for it;
dishonored for the reason that the check was drawn III. The Honorable Court of Appeals erred, on a
against insufficient fund. matter of law, in holding petitioner liable for
Furious over the incident, he immediately proceeded attorney's fees in the amount of P20,000.00, when
to the bank and urged an immediate verification of there is no legal nor factual basis for it.
his account. We find no merit in the petition.
Upon verification, the bank noticed the error. The First. For Article 2179 3 of the Civil Code to apply, it must be
P32,000.00 deposit posted in the account of established that private respondent's own negligence was the
Florencio Amador was immediately transferred to immediate and proximate cause of his injury. The concept of
the account of Reyes upon being cleared by proximate cause is well defined in our corpus of jurisprudence as
Florencio Amador that he did not effect a deposit in "any cause which, in natural and continuous sequence, unbroken
the amount of P32,000.00. The transfer having been by any efficient intervening cause, produces the result complained
effected, the bank then honored the October 12, of and without which would not have occurred and from which it
1979, check (Exh. "C"). ought to have been forseen or reasonably anticipated by a person
On the basis of these facts, the trial court ordered petitioner to pay of ordinary case that the injury complained of or some similar
to the private respondent: (1) P200,000.00 as compensatory injury, would result therefrom as a natural and probable
damages; (2) P100,000.00 as moral damages; (3) P25,000.00 as consequence." 4 In the case at bench, the proximate cause of the
attorney's fees, and (4) the costs of suit. On appeal to the injury is the negligence of petitioner's employee in erroneously
respondent court, the judgment was modified as aforestated. posting the cash deposit of private respondent in the name of
In this petition for review, petitioner argues: another depositor who had a similar first name. As held by the trial
I. Respondent Court of Appeals erred on a matter of court:
law, in not applying the first sentence of Article xxx xxx xxx
2179, New Civil Code, in view of its own finding that Applying the test, the bank employee is, on that
respondent Reyes' own representative committed the basis, deemed to have failed to exercise the degree of
mistake in writing down the correct account care required in the performance of his duties. As
number; earlier stated, the bank employee posted the cash
II. Respondent Court of Appeals erred, on a matter deposit in the account of Florencio Amador from his
of law, in holding that respondent Reyes has the assumption that the name Florencio appearing on

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the ledger without, however, going through the full very petty things for the approving manager to look
name, is the same Florencio stated in the deposit into" (p. 78, Record on Appeal). Unfortunately, it was
slip. He should have continuously gone beyond mere a "petty thing," like the incorrect account number
assumption, which was proven to be erroneous, and that the bank teller wrote on the initial deposit slip
proceeded with clear certainty, considering the for the newly-opened joint current account of the
amount involved and the repercussions it would Canlas spouses, that sparked this half-a-million-
create on the totality of the person notable of which peso damage suit against the bank.
is the credit standing of the person involved should While the bank's negligence may not have been
a mistake happen. The checks issued by the plaintiff attended with malice and bad faith, nevertheless, it
in the course of his business were dishonored by the caused serious anxiety, embarrassment and
bank because the ledger of Florencio Reyes indicated humiliation to the private respondents for which
a balance insufficient to cover the face value of they are entitled to recover reasonable moral
checks. damages (American Express International, Inc. IAC,
Second. In light of this negligence, the liability of petitioner for 167 SCRA 209). The award of reasonable attorney's
moral damages cannot be impugned. So we held in Bank of the fees is proper for the private respondent's were
Philippine Islands vs. IAC, et al. 5 compelled to litigate to protect their interest (Art.
The bank is not expected to be infallible but, as 2208, Civil Code). However, the absence of malice
correctly observed by respondent Appellate Court, in and bad faith renders the award of exemplary
this instance, it must bear the blame for not damages improper (Globe Mackay Cable and Radio
discovering the mistake of its teller despite the Corp. vs. Court of Appeals, 176 SCRA 778).
established procedure requiring the papers and IN VIEW WHEREOF, the petition is denied there being no
bank books to pass through a battery of bank reversible error in the Decision of the respondent court. Cost
personnel whose duty it is to check and against petitioner.
countercheck them for possible errors. Apparently, SO ORDERED.
the officials and employees tasked to do that did not
perform their duties with due care, as may be
gathered from the testimony of the bank's lone
witness, Antonio Enciso, who casually declared that
"the approving officer does not have to see the
account numbers and all those things. Those are

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Republic of the Philippines towards the van. In between the two vehicles was a parked prime
SUPREME COURT mover with a trailer, owned by private respondent Liberty Forest,
Manila Inc.3
THIRD DIVISION The night before, at around 10:00 p.m., the prime mover with
G.R. No. 161803 February 4, 2008 trailer suffered a tire blowout. The driver, private respondent
DY TEBAN TRADING, INC., petitioner, Cresilito Limbaga, parked the prime mover askew occupying a
vs. substantial portion of the national highway, on the lane of the
JOSE CHING AND/OR LIBERTY FOREST, INC. and CRESILITO passenger bus. He parked the prime mover with trailer at the
M. LIMBAGA, respondents. shoulder of the road with the left wheels still on the cemented
DECISION highway and the right wheels on the sand and gravel shoulder of
REYES, R.T., J.: the highway.4 The prime mover was not equipped with triangular,
THE vehicular collision resulting in damages and injuries in this collapsible reflectorized plates, the early warning device required
case could have been avoided if the stalled prime mover with trailer under Letter of Instruction No. 229. As substitute, Limbaga placed
were parked properly and equipped with an early warning device. It a banana trunk with leaves on the front and the rear portion of the
is high time We sounded the call for strict enforcement of the law prime mover to warn incoming motorists. It is alleged that Limbaga
and regulation on traffic and vehicle registration. Panahon na para likewise placed kerosene lighted tin cans on the front and rear of
mahigpit na ipatupad ang batas at regulasyon sa trapiko at the trailer.5
pagpapatala ng sasakyan. To avoid hitting the parked prime mover occupying its lane, the
Before Us is a petition for review on certiorari of the Decision1 of the incoming passenger bus swerved to the right, onto the lane of the
Court of Appeals (CA) modifying that2 of the Regional Trial Court approaching Nissan van. Ortiz saw two bright and glaring
(RTC) in Butuan City finding private respondents Liberty Forest, headlights and the approaching passenger bus. He pumped his
Inc. and Cresilito Limbaga liable to petitioner Dy Teban Trading, break slowly, swerved to the left to avoid the oncoming bus but the
Inc. for damages. van hit the front of the stationary prime mover. The passenger bus
Facts hit the rear of the prime mover.6
On July 4, 1995, at around 4:45 a.m., Rogelio Ortiz, with helper Ortiz and Catamora only suffered minor injuries. The Nissan van,
Romeo Catamora, was driving a Nissan van owned by petitioner Dy however, became inoperable as a result of the incident. After the
Teban Trading, Inc. along the National Highway in Barangay collision, SPO4 Teofilo Pame conducted an investigation and
Sumilihon, Butuan City, going to Surigao City. They were submitted a police traffic incident investigation report. 7
delivering commercial ice to nearby barangays and municipalities. On October 31, 1995, petitioner Nissan van owner filed a complaint
A Joana Paula passenger bus was cruising on the opposite lane for damages8 against private respondents prime mover owner and

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driver with the RTC in Butuan City. The Joana Paula passenger tires of the prime mover were the only ones on the sand and
bus was not impleaded as defendant in the complaint. gravel shoulder of the highway while the left tires and all
RTC Disposition the tires of the trailer were on the cemented pavement of
On August 7, 2001, the RTC rendered a decision in favor of the highway, occupying almost the whole of the right lane
petitioner Dy Teban Trading, Inc. with a fallo reading: on the direction the prime mover and trailer were traveling.
WHEREFORE, judgment is hereby rendered directing, The statement of Limbaga that he could not park the prime
ordaining and ordering: mover and trailer deeper into the sand and gravel shoulder
a) That defendants Liberty Forest, Inc. and Cresilito M. of the highway to his right because there were banana
Limbaga pay, jointly and solidarily, plaintiff Dy Teban plants is contradicted by the picture marked Exhibit "F."
Trading, Inc. the amounts of P279,832.00 as actual and The picture shows that there was ample space on the
compensatory damages, P30,000.00 as attorneys fees and shoulder. If defendant Limbaga was careful and prudent
P5,000.00 as expenses of litigation; enough, he should have the prime mover and trailer
b) That all money claims of plaintiff Rogelio C. Ortiz are traveled more distance forward so that the bodies of the
dismissed; prime mover and trailer would be far more on the shoulder
c) That defendant Jose Ching is absolved from any civil rather than on the cemented highway when they were
liability or the case against him dismissed; parked. x x x The court has some doubts on the statement
d) That the counterclaim of all the defendants is dismissed; of witness-driver Limbaga that there were banana trunks
and with leaves and lighted tin cans with crude oil placed 3
e) That defendants Liberty Forest, Inc. and Cresilito M. strides in front of the prime mover and behind the trailer
Limbaga to pay, jointly and solidarily, the costs. because the testimonies of witnesses Rogelio C. Ortiz, driver
SO ORDERED.9 of the ice van, Romeo D. Catamora, helper of the ice van,
The RTC held that the proximate cause of the three-way vehicular and Police Traffic Investigator SPO3 Teofilo M. Pame show
collision was improper parking of the prime mover on the national that there were no banana trunks with leaves and lighted
highway and the absence of an early warning device on the vehicle, tin cans at the scene of the incident. But even assuming
thus: that there were banana trunks with leaves but they were
The court finds that the proximate cause of the incidents is placed close to the prime mover and trailer as they were
the negligence and carelessness attributable to the placed 3 strides away which to the mind of the court is
defendants. When the trailer being pulled by the prime equivalent approximately to 3 meters and with this
mover suffered two (2) flat tires at Sumilihon, the prime distance, approaching vehicles would have no sufficient
mover and trailer were parked haphazardly, as the right time and space to make a complete stop, especially if the

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vehicles are heavy and loaded. If there were lighted tin corporation. Witness Limbaga in his testimony mentioned a
cans, it was not explained by the defendants why the driver, certain Boy Ching as the Manager but it was never clarified
especially driver witness Ortiz, did not see them. whether or not Boy Ching and defendant Jose Ching is one
xxxx and the same person.10
Defendant Liberty Forest, Inc. did not exercise the diligence Private respondents appealed to the CA.
of a good father of a family in managing and running its CA Disposition
business. The evidence on record shows that it failed to On August 28, 2003, the CA reversed the RTC decision, disposing
provide its prime mover and trailer with the required "early as follows:
warning devices" with reflectors and it did not keep proper WHEREFORE, premises considered, the decision dated
maintenance and condition of the prime mover and the August 7, 2001 of the Regional Trial Court, Branch 2,
trailer. The circumstances show that the trailer were Butuan City in Civil Case No. 4360 is hereby PARTLY
provided with wornout tires and with only one (1) piece of MODIFIED by absolving the defendants-
spare tire. The pictures marked Exhibit "3" and "4" show appellants/appellees of any liability to plaintiffs-
that two (2) flat tires suffered by the trailer and these two appellants/appellees by reason of the incident on July 4,
(2) tires were attached to one of the two (2) I-beams or axles 1995.
attached to the rear of the trailer which axle is very near The dismissal of the case against Jose Ching, the
but behind the other axle and with the location of the 2 I- counterclaim of defendants-appellants/appellees and the
beams, it would have the other I-beam that would have money claim of Rogelio Ortiz STANDS.
suffered the flat tires as it has to bear the brunt of weight of SO ORDERED.11
the D-8 bulldozer. The bulldozer was not loaded directly In partly reversing or partly modifying the RTC decision, the CA
above the two (2) I-beams as 2 I-beams, as a pair, were held that the proximate cause of the vehicular collision was the
attached at the far rear end of the trailer. failure of the Nissan van to give way or yield to the right of way of
xxxx the passenger bus, thus:
However, defendant Jose Ching should be absolved of any It was stated that the Joana Paula bus in trying to avoid a
liability as there is no showing that he is the manager or head-on collision with the truck, sideswept the parked
CEO of defendant Liberty Forest, Inc. Although in the trailer loaded with bulldozer.
answer, it is admitted that he is an officer of the defendant Evidently, the driver of the Joana Paula bus was aware of
corporation, but it is not clarified what kind of position he the presence on its lane of the parked trailer with bulldozer.
is holding, as he could be an officer as one of the members For this reason, it proceeded to occupy what was left of its
of the Board of Directors or a cashier and treasurer of the lane and part of the opposite lane. The truck occupying the

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opposite lane failed to give way or yield the right of way to and may cause the bulldozer to fall from where it was
the oncoming bus by proceeding with the same speed. The mounted. In fact, it appeared that the driver of the trailer
two vehicles were, in effect, trying to beat each other in tried its best to park on the graveled shoulder since the
occupying a single lane. The bus was the first to occupy the right-front tires were on the graveled shoulder of the road.
said lane but upon realizing that the truck refused to give The lower court erred in stating that the Joana Paula bus
way or yield the right of way, the bus, as a precaution, swerved to the left of the truck because it did not see the
geared to its right where the trailer was parked. parked trailer due to lack of warning sign of danger of any
Unfortunately, the bus miscalculated its distance from the kind that can be seen from a distance. The damage suffered
parked trailer and its rear right side hit the protruding by the Joana Paula bus belied this assessment. As stated
blade of the bulldozer then on the top of the parked trailer. before, the Joana Paula bus, with the intention of passing
The impact of the collision on its right rear side with the first which it did, first approached the space beside the
blade of the bulldozer threw the bus further to the opposite parked trailer, veered too close to the parked trailer thereby
lane, landing its rear portion on the shoulder of the hitting its rear right side on the protruding bulldozer blade.
opposite lane. Since the damage was on the rear right most of the bus, it
xxxx was clearly on the space which was wide enough for a
Facts of the case reveal that when Ortiz, the driver of the single passing vehicle but not sufficient for two (2) passing
truck, failed to give the Joana Paula bus the space on the vehicles. The bus was thrown right to the path of the truck
road it needed, the latter vehicle scraped its rear right side by the impact of the collision of its rear right side with the
on the protruded bulldozer blade and the impact threw the bulldozer blade.12
bus directly on the path of the oncoming truck. This made The CA disagreed with the RTC that the prime mover did not have
plaintiffs-appellants/appellees conclude that the Joana an early warning device. The appellate court accepted the claim of
Paula bus occupied its lane which forced Ortiz, the driver of private respondent that Limbaga placed kerosene lighted tin cans
the truck, to swerve to its left and ram the front of the on the front and rear of the trailer which, in Baliwag Transit, Inc. v.
parked trailer. Court of Appeals,13 may act as substitute early warning device. The
xxxx CA stated:
The trailer was parked because its two (2) rear-left tires Likewise, it was incorrect for the lower court to state that
were blown out. With a bulldozer on top of the trailer and there was no warning sign of danger of any kind, most
two (2) busted tires, it would be dangerous and quite probably referring to the absence of the triangular
impossible for the trailer to further park on the graveled reflectorized plates. The police sketch clearly indicated the
shoulder of the road. To do so will cause the flat car to tilt stack of banana leaves placed at the rear of the parked

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trailer. The trailers driver testified that they placed Whatever damage plaintiffs-appellants/appellees suffered,
kerosene lighted tin can at the back of the parked trailer. they alone must bear them.14
A pair of triangular reflectorized plates is not the only early Issues
warning device allowed by law. The Supreme Court (in Petitioner raises two issues15 for Our consideration, to wit:
Baliwag Transit, Inc. v. Court of Appeals) held that: I.
"x x x Col. Dela Cruz and Romano testified that they THE HONORABLE COURT OF APPEALS, WITHOUT ANY
did not see any early warning device at the scene of AVAILABLE CONCRETE EVIDENCE, ERRONEOUSLY
the accident. They were referring to the triangular DETERMINED THAT THERE WERE EARLY WARNING
reflectorized plates in red and yellow issued by the DEVICES PLACED IN FRONT OF THE DEFENDANT-
Land Transportation Office. However, the evidence APPELLANTS/APPELLEES TRUCK AND FLAT CAR TO
shows that Recontique and Ecala placed a kerosene WARN PLAINTIFF-APPELLANT/APPELLEE ROGELIO ORTIZ
lamp or torch at the edge of the road, near the rear OF THEIR PRESENCE.
portion of the truck to serve as an early warning II.
device. This substantially complies with Section WITH DUE RESPECT, IT IS HIGH TIME TO ENFORCE THE
34(g) of the Land Transportation and Traffic Code x LAW ON EARLY WARNING DEVICES IN THE PUBLIC
xx INTEREST.
Baliwags argument that the kerosene lamp or torch Our Ruling
does not substantially comply with the law is The petition is meritorious.
untenable. The aforequoted law clearly allows the The meat of the petition is whether or not the prime mover is liable
use not only of an early warning device of the for the damages suffered by the Nissan van. The RTC ruled in the
triangular reflectorized plates variety but also affirmative holding that the proximate cause of the vehicular
parking lights or flares visible one hundred meters collision was the negligence of Limbaga in parking the prime mover
away. x x x." on the national highway without an early warning device on the
This Court holds that the defendants-appellants/appellees vehicle. The CA reversed the RTC decision, holding that the
were not negligent in parking the trailer on the scene of the proximate cause of the collision was the negligence of Ortiz in not
accident. It would have been different if there was only one yielding to the right of way of the passenger bus.
flat tire and defendant-appellant/appellee Limbaga failed to Article 2176 of the Civil Code provides that whoever by act or
change the same and left immediately. omission causes damage to another, there being fault or
As such, defendants-appellants/appellees are not liable for negligence, is obliged to pay for the damage done. Such fault or
the damages suffered by plaintiffs-appellants/appellees. negligence, if there is no pre-existing contractual relation between

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the parties, is called a quasi-delict. To sustain a claim based on situation before him. The law considers what would be
quasi-delict, the following requisites must concur: (a) damage reckless, blameworthy, or negligent in the man of ordinary
suffered by plaintiff; (b) fault or negligence of defendant; and (c) intelligence and prudence and determines liability by that.
connection of cause and effect between the fault or negligence of (Underscoring supplied)
defendant and the damage incurred by plaintiff. 16 The test of negligence is objective. We measure the act or omission
There is no dispute that the Nissan van suffered damage. That is of the tortfeasor with that of an ordinary reasonable person in the
borne by the records and conceded by the parties. The outstanding same situation. The test, as applied to this case, is whether
issues are negligence and proximate cause. Tersely put, the twin Limbaga, in parking the prime mover, used that reasonable care
issues are: (a) whether or not prime mover driver Limbaga was and caution which an ordinary reasonable person would have used
negligent in parking the vehicle; and (b) whether or not his in the same situation.
negligence was the proximate cause of the damage to the Nissan We find that Limbaga was utterly negligent in parking the prime
van. mover askew on the right side of the national highway. The vehicle
Limbaga was negligent in parking the prime mover on the occupied a substantial portion of the national road on the lane of
national highway; he failed to prevent or minimize the risk to the passenger bus. It was parked at the shoulder of the road with
oncoming motorists. its left wheels still on the cemented highway and the right wheels
Negligence is defined as the failure to observe for the protection of on the sand and gravel shoulder of the highway. It is common
the interests of another person that degree of care, precaution, and sense that the skewed parking of the prime mover on the national
vigilance which the circumstances justly demand, whereby such road posed a serious risk to oncoming motorists. It was incumbent
other person suffers injury.17 The Supreme Court stated the test of upon Limbaga to take some measures to prevent that risk, or at
negligence in the landmark case Picart v. Smith18 as follows: least minimize it.
The test by which to determine the existence or negligence We are unable to agree with the CA conclusion "it would have been
in a particular case may be stated as follows: Did the dangerous and quite impossible to further park the prime mover on
defendant in doing the alleged negligent act use that the graveled shoulder of the road because the prime mover may tilt
reasonable care and caution which an ordinary person and the bulldozer may fall off." The photographs taken after the
would have used in the same situation? If not, then he is incident show that it could have been possible for Limbaga to park
guilty of negligence. The law here in effect adopts the the prime mover completely on the shoulder of the national road
standard supposed to be supplied by the imaginary conduct without risk to oncoming motorists. We agree with the RTC
of the discreet paterfamilias of the Roman law. The observation on this point, thus:
existence of negligence in a given case is not determined by x x x The statement of Limbaga that he could not park the
reference to the personal judgment of the actor in the prime mover and trailer deeper into the sand and gravel

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shoulder of the highway to his right because there were Limbaga also admitted on cross-examination that it was his first
banana plants is contradicted by the picture marked time to drive the prime mover with trailer loaded with a D-8
Exhibit "F." The picture shows that there was ample space caterpillar bulldozer.21 We find that private respondent Liberty
on the shoulder. If defendant Limbaga was careful and Forest, Inc. was utterly negligent in allowing a novice driver, like
prudent enough, he should have the prime mover and Limbaga, to operate a vehicle, such as a truck loaded with a
trailer traveled more distance forward so that the bodies of bulldozer, which required highly specialized driving skills.
the prime mover and trailer would be far more on the Respondent employer clearly failed to properly supervise Limbaga
shoulder rather than on the cemented highway when they in driving the prime mover.
were parked. Although at the time of the incident, it was The RTC noted that private respondent Liberty Forest, Inc. also
about 4:45 in the morning and it was drizzling but there is failed to keep the prime mover in proper condition at the time of
showing that it was pitch dark that whoever travels along the collision. The prime mover had worn out tires. It was only
the highway must be extra careful. If the Joana Paula bus equipped with one spare tire. It was for this reason that Limbaga
swerved to the lane on which the "Nissan" ice van was was unable to change the two blown out tires because he had only
properly traveling, as prescribed by Traffic Rules and one spare. The bulldozer was not even loaded properly on the
Regulations, it is because the driver of the bus did not see prime mover, which caused the tire blowouts.
at a distance the parked prime mover and trailer on the All told, We agree with the RTC that private respondent Limbaga
bus proper lane because there was no warning signs of was negligent in parking the prime mover on the national highway.
danger of any kind that can be seen from a distance. 19 Private respondent Liberty Forest, Inc. was also negligent in failing
Limbaga also failed to take proper steps to minimize the risk posed to supervise Limbaga and in ensuring that the prime mover was in
by the improperly parked prime mover. He did not immediately proper condition.
inform his employer, private respondent Liberty Forest, Inc., that The case of Baliwag Transit, Inc. v. Court of Appeals is
the prime mover suffered two tire blowouts and that he could not inapplicable; Limbaga did not put lighted kerosene tin cans
have them fixed because he had only one spare tire. Instead of on the front and rear of the prime mover.
calling for help, Limbaga took it upon himself to simply place Anent the absence of an early warning device on the prime mover,
banana leaves on the front and rear of the prime mover to serve as the CA erred in accepting the bare testimony of Limbaga that he
warning to oncoming motorists. Worse, Limbaga slept on the prime placed kerosene lighted tin cans on the front and rear of the prime
mover instead of standing guard beside the vehicle. By his own mover. The evidence on records belies such claim. The CA reliance
account, Limbaga was sleeping on the prime mover at the time of on Baliwag Transit, Inc. v. Court of Appeals22 as authority for the
the collision and that he was only awakened by the impact of the proposition that kerosene lighted tin cans may act as substitute
Nissan van and the passenger bus on the prime mover. 20 early warning device is misplaced.

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First, the traffic incident report did not mention any lighted tin Second, SPO4 Pame, who investigated the collision, testified24 that
cans on the prime mover or within the immediate vicinity of the only banana leaves were placed on the front and rear of the prime
accident. Only banana leaves were placed on the prime mover. The mover. He did not see any lighted tin cans in the immediate vicinity
report reads: of the collision.
VIII RESULT OF INVESTIGATION: A Joana Pa_ula Bus, Third, the claim of Limbaga that he placed lighted tin cans on the
with Body No. 7788, with Plate No. LVA-137, driven by one front and rear of the prime mover belatedly surfaced only during
Temestocles Relova v. Antero, of legal age, married and a his direct examination. No allegation to this effect was made by
resident of San Roque, Kitcharao, Agusan del Norte, while private respondents in their Answer to the complaint for damages.
traveling along the National Highway, coming from the east Petitioners counsel promptly objected to the testimony of Limbaga,
going to the west direction, as it moves along the way and thus:
upon reaching Brgy. Sumilihon, Butuan City to evade ATTY. ROSALES:
bumping to the approaching Nissan Ice Van with Plate No. Q. Now you mentioned about placing some word signs in
PNT-247, driven by one Rogelio Cortez y Ceneza. As the front and at the rear of the prime mover with trailer, will
result, the Joana Paula Bus accidentally busideswept (sic) you please describe to us what this word signs are?
to the parked Prime Mover with Trailer loaded with A. We placed a piece of cloth on tin cans and filled them
Bulldozer without early warning device, instead placing with crude oil. And these tin cans were lighted and they are
only dry banana leaves three (3) meters at the rear portion like torches. These two lights or torches were placed in front
of the Trailer, while failure to place at the front portion, and and at the rear side of the prime mover with trailer. After
the said vehicle occupied the whole lane. As the result, the each torch, we placed banana trunk. The banana trunk is
Joana Paula Bus hit to the left edge blade of the Bulldozer. placed between the two (2) torches and the prime mover,
Thus, causing the said bus swept to the narrow both on the rear and on the front portion of the prime
shouldering, removing the rear four (4) wheels including the mover.
differential and injuring the above-stated twelve (12) Q. How far was the lighted tin cans with wick placed in
passengers and damaged to the right side fender above the front of the prime mover.
rear wheel. Thus, causing damage on it. While the Nissan ATTY. ASIS:
Ice Van in evading, accidentally swerved to the left lane and At this point, we will be objecting to questions particularly
accidentally bumped to the front bumper of the parked referring to the alleged tin cans as some of the warning-sign
Prime Mover with Trailer loaded with Bulldozer. Thus, devices, considering that there is no allegation to that effect
causing heavy damage to said Nissan Ice Van including the in the answer of the defendants. The answer was just
cargoes of the said van.23 limited to the numbers 4 & 5 of the answer. And, therefore,

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if we follow the rule of the binding effect of an allegation in at the moment of his act or default that an injury to some person
the complaint, then the party will not be allowed to might probably result therefrom.27
introduce evidence to attack jointly or rather the same, There is no exact mathematical formula to determine proximate
paragraph 5 states, warning device consisting of 3 banana cause. It is based upon mixed considerations of logic, common
trunks, banana items and leaves were filed. He can be sense, policy and precedent.28 Plaintiff must, however, establish a
cross-examined in the point, Your Honor. sufficient link between the act or omission and the damage or
COURT: injury. That link must not be remote or far-fetched; otherwise, no
Q. Put that on record that as far as this tin cans are liability will attach. The damage or injury must be a natural and
concerned, the plaintiffs are interposing continuing probable result of the act or omission. In the precedent-setting
objections. But the Court will allow the question. 25 Vda. de Bataclan v. Medina,29 this Court discussed the necessary
We thus agree with the RTC that Limbaga did not place lighted tin link that must be established between the act or omission and the
cans on the front and rear of the prime mover. We give more damage or injury, viz.:
credence to the traffic incident report and the testimony of SPO4 It may be that ordinarily, when a passenger bus overturns,
Pame that only banana leaves were placed on the vehicle. Baliwag and pins down a passenger, merely causing him physical
Transit, Inc. v. Court of Appeals26 thus finds no application to the injuries, if through some event, unexpected and
case at bar. extraordinary, the overturned bus is set on fire, say, by
The skewed parking of the prime mover was the proximate lightning, or if some highwaymen after looting the vehicle
cause of the collision. sets it on fire, and the passenger is burned to death, one
Proximate cause is defined as that cause, which, in natural and might still contend that the proximate cause of his death
continuous sequence, unbroken by any efficient intervening cause, was the fire and not the overturning of the vehicle. But in
produces the injury, and without which the result would not have the present case and under the circumstances obtaining in
occurred. More comprehensively, proximate cause is that cause the same, we do not hesitate to hold that the proximate
acting first and producing the injury, either immediately or by cause of the death of Bataclan was the overturning of the
setting other events in motion, all constituting a natural and bus, this for the reason that when the vehicle turned not
continuous chain of events, each having a close causal connection only on its side but completely on its back, the leaking of
with its immediate predecessor, the final event in the chain the gasoline from the tank was not unnatural or
immediately effecting the injury as natural and probable result of unexpected; that the coming of the men with a lighted torch
the cause which first acted, under such circumstances that the was in response to the call for help, made not only by the
person responsible for the first event should, as an ordinarily passengers, but most probably, by the driver and the
prudent and intelligent person, have reasonable ground to expect conductor themselves, and that because it was very dark

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(about 2:30 in the morning), the rescuers had to carry a obviously would not have swerved if not for the passenger bus
light with them; and coming as they did from a rural area abruptly occupying his vans lane. The passenger bus, in turn,
where lanterns and flashlights were not available, they had would not have swerved to the lane of the Nissan van if not for the
to use a torch, the most handy and available; and what was prime mover improperly parked on its lane. The skewed parking is
more natural than that said rescuers should innocently the proximate cause of the damage to the Nissan van.
approach the overturned vehicle to extend the aid and effect In Phoenix Construction, Inc. v. Intermediate Appellate Court,30 this
the rescue requested from them. In other words, the coming Court held that a similar vehicular collision was caused by the
of the men with the torch was to be expected and was skewed parking of a dump truck on the national road, thus:
natural sequence of the overturning of the bus, the trapping The conclusion we draw from the factual circumstances
of some of its passengers bus, the trapping of some of its outlined above is that private respondent Dionisio was
passengers and the call for outside help. negligent the night of the accident. He was hurrying home
The ruling in Bataclan has been repeatedly cited in subsequent that night and driving faster than he should have been.
cases as authority for the proposition that the damage or injury Worse, he extinguished his headlights at or near the
must be a natural or probable result of the act or omission. Here, intersection of General Lacuna and General Santos Streets
We agree with the RTC that the damage caused to the Nissan van and thus did not see the dump truck that was parked
was a natural and probable result of the improper parking of the askew and sticking out onto the road lane.
prime mover with trailer. As discussed, the skewed parking of the Nonetheless, we agree with the Court of First Instance and
prime mover posed a serious risk to oncoming motorists. Limbaga the Intermediate Appellate Court that the legal and
failed to prevent or minimize that risk. The skewed parking of the proximate cause of the accident and of Dionisios injuries
prime mover triggered the series of events that led to the collision, was the wrongful or negligent manner in which the dump
particularly the swerving of the passenger bus and the Nissan van. truck was parked in other words, the negligence of
Private respondents Liberty Forest, Inc. and Limbaga are liable for petitioner Carbonel. That there was a reasonable
all damages that resulted from the skewed parking of the prime relationship between petitioner Carbonels negligence on the
mover. Their liability includes those damages resulting from one hand and the accident and respondents injuries on the
precautionary measures taken by other motorist in trying to avoid other hand, is quite clear. Put in a slightly different
collision with the parked prime mover. As We see it, the passenger manner, the collision of Dionisios car with the dump truck
bus swerved to the right, onto the lane of the Nissan van, to avoid was a natural and foreseeable consequence of the truck
colliding with the improperly parked prime mover. The driver of the drivers negligence.
Nissan van, Ortiz, reacted swiftly by swerving to the left, onto the xxxx
lane of the passenger bus, hitting the parked prime mover. Ortiz

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We believe, secondly, that the truck drivers negligence far the presence of the prime mover on its lane, but it still proceeded
from being a "passive and static condition" was rather an to occupy the lane of the Nissan van. The passenger bus also
indispensable and efficient cause. The collision between the miscalculated its distance from the prime mover when it hit the
dump truck and the private respondents car would in all vehicle.
probability not have occurred had the dump truck not been We cannot definitively rule on the proportionate or contributory
parked askew without any warning lights or reflector liability of the Joana Paula passenger bus vis--vis the prime mover
devices. The improper parking of the dump truck created an because it was not a party to the complaint for damages. Due
unreasonable risk of injury for anyone driving down process dictates that the passenger bus must be given an
General Lacuna Street and for having so created this risk, opportunity to present its own version of events before it can be
the truck driver must be held responsible. In our view, held liable. Any contributory or proportionate liability of the
Dionisios negligence, although later in point of time than passenger bus must be litigated in a separate action, barring any
the truck drivers negligence and, therefore, closer to the defense of prescription or laches. Insofar as petitioner is
accident, was not an efficient intervening or independent concerned, the proximate cause of the collision was the improper
cause. What the Petitioner describes as an "intervening parking of the prime mover. It was the improper parking of the
cause" was no more than a foreseeable consequence of the prime mover which set in motion the series of events that led to the
risk created by the negligent manner in which the truck vehicular collision.
driver had parked the dump truck. In other words, the Even granting that the passenger bus was at fault, its fault will not
petitioner truck driver owed a duty to private respondent necessarily absolve private respondents from liability. If at fault,
Dionisio and others similarly situated not to impose upon the passenger bus will be a joint tortfeasor along with private
them the very risk the truck driver had created. Dionisios respondents. The liability of joint tortfeasors is joint and solidary.
negligence was not of an independent and overpowering This means that petitioner may hold either of them liable for
nature as to cut, as it were, the chain of causation in fact damages from the collision. In Philippine National Construction
between the improper parking of the dump truck and the Corporation v. Court of Appeals,31 this Court held:
accident, nor to sever the juris vinculum of liability. x x x According to the great weight of authority, where the
(Underscoring supplied) concurrent or successive negligent acts or omission of two
We cannot rule on the proportionate or contributory liability or more persons, although acting independently of each
of the passenger bus, if any, because it was not a party to the other, are, in combination, the direct and proximate cause
case; joint tortfeasors are solidarily liable. of a single injury to a third person and it is impossible to
The CA also faults the passenger bus for the vehicular collision. determine in what proportion each contributed to the
The appellate court noted that the passenger bus was "aware" of injury, either is responsible for the whole injury, even

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though his act alone might not have caused the entire wrongdoer is responsible for the entire result and is liable
injury, or the same damage might have resulted from the as though his acts were the sole cause of the injury.
acts of the other tort-feasor x x x. There is no contribution between joint tortfeasors whose
In Far Eastern Shipping Company v. Court of Appeals, the Court liability is solidary since both of them are liable for the total
declared that the liability of joint tortfeasors is joint and solidary, damage. Where the concurrent or successive negligent acts
to wit: or omissions of two or more persons, although acting
It may be said, as a general rule, that negligence in order to independently, are in combination with the direct and
render a person liable need not be the sole cause of an proximate cause of a single injury to a third person, it is
injury. It is sufficient that his negligence, concurring with impossible to determine in what proportion each
one or more efficient causes other than plaintiffs, is the contributed to the injury and either of them is responsible
proximate cause of the injury. Accordingly, where several for the whole injury. Where their concurring negligence
causes combine to produce injuries, a person is not relieved resulted in injury or damage to a third party, they become
from liability because he is responsible for only one of them, joint tortfeasors and are solidarily liable for the resulting
it being sufficient that the negligence of the person charged damage under Article 2194 of the Civil Code. (Underscoring
with injury is an efficient cause without which the injury supplied)
would not have resulted to as great an extent, and that All told, all the elements of quasi delict have been proven by clear
such cause is not attributable to the person injured. It is no and convincing evidence. The CA erred in absolving private
defense to one of the concurrent tortfeasors that the injury respondents from liability for the vehicular collision.
would not have resulted from his negligence alone, without Final Note
the negligence or wrongful acts of the other concurrent It is lamentable that the vehicular collision in this case could have
tortfeasors. Where several causes producing an injury are been easily avoided by following basic traffic rules and regulations
concurrent and each is an efficient cause without which the and road safety standards. In hindsight, private respondent
injury would not have happened, the injury may be Limbaga could have prevented the three-way vehicular collision if
attributed to all or any of the causes and recovery may be he had properly parked the prime mover on the shoulder of the
had against any or all of the responsible persons although national road. The improper parking of vehicles, most especially
under the circumstances of the case, it may appear that along the national highways, poses a serious and unnecessary risk
one of them was more culpable, and that the duty owed by to the lives and limbs of other motorists and passengers. Drivers
them to the injured person was not the same. No actors owe a duty of care to follow basic traffic rules and regulations and
negligence ceases to be a proximate cause merely because it to observe road safety standards. They owe that duty not only for
does not exceed the negligence of other actors. Each their own safety, but also for that of other motorists. We can

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prevent most vehicular accidents by simply following basic traffic
rules and regulations.
We also note a failure of implementation of basic safety standards,
particularly the law on early warning devices. This applies even
more to trucks and big vehicles, which are prone to mechanical
breakdown on the national highway. The law, as crafted, requires
vehicles to be equipped with triangular reflectorized plates. 32
Vehicles without the required early warning devices are ineligible
for registration.33 Vehicle owners may also be arrested and fined for
non-compliance with the law.34
The Land Transportation Office (LTO) owes a duty to the public to
ensure that all vehicles on the road meet basic and minimum
safety features, including that of early warning devices. It is most
unfortunate that We still see dilapidated and rundown vehicles on
the road with substandard safety features. These vehicles not only
pose a hazard to the safety of their occupants but that of other
motorists. The prime mover truck in this case should not have
been granted registration because it failed to comply with the
minimum safety features required for vehicles on the road.
It is, indeed, time for traffic enforcement agencies and the LTO to
strictly enforce all pertinent laws and regulations within their
mandate.
WHEREFORE, the petition is GRANTED. The Court of Appeals
decision dated August 28, 2003 is hereby SET ASIDE. The RTC
decision dated August 7, 2001 is REINSTATED IN FULL.
SO ORDERED.

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Republic of the Philippines that he himself had called this carromata first. The driver, one
SUPREME COURT Julio Pagnaya, replied to the effect that he had not heard or seen
Manila the call of Araneta, and that he had taken up the two passengers
EN BANC then in the carromata as the first who had offered employment. At
G.R. No. L-15674 October 17, 1921 or about the same time Pagnaya pulled on the reins of the bridle to
CONSOLACION GABETO, in her own right and as guardian ad free the horse from the control of Agaton Araneta, in order that the
litem of her three children, plaintiff-appellee, vehicle might pass on. Owing, however, to the looseness of the
vs. bridle on the horse's head or to the rottenness of the material of
AGATON ARANETA, defendant-appellant. which it was made, the bit came out of the horse's mouth; and it
Jose E. Locsin for appellant. became necessary for the driver to get out, which he did, in order
Block, Johnston and Greenbaum for appellee. to find the bridle. The horse was then pulled over to near the curb,
by one or the other it makes no difference which and Pagnaya
STREET, J.: tried to fix the bridle.
This action was instituted in the Court of First Instance of Iloilo by While he was thus engaged, the horse, being free from the control
Consolacion Gabeto, in her own right as widow of Proceso of the bit, became disturbed and moved forward, in doing which he
Gayetano, and as guardian ad litem of the three children, Conchita pulled one of the wheels of the carromata up on the sidewalk and
Gayetano, Rosita Gayetano, and Fermin Gayetano, for the purpose pushed Julio Pagnaya over. After going a few years further the side
of recovering damages incurred by the plaintiff as a result of the of the carromata struck a police telephone box which was fixed to a
death of the said Proceso Gayetano, supposedly cause by the post on the sidewalk, upon which the box came down with a crash
wrongful act of the defendant Agaton Araneta. Upon hearing the and frightened the horse to such an extent that he set out at full
evidence, his Honor, Judge L. M. Southworth, awarded damages to speed up the street.
the plaintiff in the amount of P3,000, from which judgment the Meanwhile one of the passengers, to wit. Basilio Ilano, had alighted
defendant appealed. while the carromata was as yet alongside the sidewalk; but the
It appears in evidence that on August 4, 1918. Basilio Ilano and other, Proceso Gayetano, had unfortunately retained his seat, and
Proceso Gayetano took a carromata near Plaza Gay, in the City of after the runaway horse had proceeded up the street to a point in
Iloilo, with a view to going to a cockpit on Calle Ledesma in the front of the Mission Hospital, the said Gayetano jumped or fell from
same City. When the driver of the carromata had turned his horse the rig, and in so doing received injuries from which he soon died.
and started in the direction indicated, the defendant, Agaton As to the facts above stated the evidence cannot be said to be
Araneta, stepped out into the street, and laying his hands on the materially in conflict; but there is decided conflict upon the point of
reins, stopped the horse, at the same time protesting to the driver the exact relation of the defendant Agaton Araneta, to the runaway.

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The evidence for the plaintiff on this point consists chiefly of the testifies to this; and it is noteworthy that Basilio Ilano does not
testimony of Julio Pagnaya and of Basilio Ilano. They both say that mention it. A decided preponderance of the evidence in our opinion
while yet in the middle of the street, the defendant jerked the is against it.
bridle, which caused the bit to come out of the horse's mouth, and The evidence indicates that the bridle was old, and the leather of
Julio says that at that juncture the throat latch of the bridle was which it was made was probably so weak as to be easily broken.
broken. Be this as it may, we are of the opinion that the mere fact Julio Pagnaya had a natural interest in refuting this fact, as well as
that the defendant interfered with the carromata by stopping the in exculpating himself in other respects; and we are of the opinion
horse in the manner stated would not make him liable for the that the several witnesses who testified for the defendant gave a
death of Proceso Gayetano; because it is admitted by Julio Pagnaya more credible account of the affair than the witnesses for the
that he afterwards got out of the carromata and went to the horse's plaintiff. According to the witnesses for the defendant, it was Julio
head to fix the bridle. The evidence is furthermore convincing to who jerked the rein, thereby causing the bit it come out of the
the effect that, after Julio Pagnaya alighted, the horse was horse's mouth; and they say that Julio, after alighting, led the
conducted to the curb and that an appreciable interval of time horse over to the curb, and proceeded to fix the bridle; and that in
elapsed same witnesses say several minutes before the horse so doing the bridle was slipped entirely off, when the horse, feeling
started on his career up the street. 1awph!l.net himself free from control, started to go away as previously stated.
It is therefore evident that the stopping of the rig by Agaton Upon the whole we are constrained to hold that the defendant is
Araneta in the middle of the street was too remote from the not legally responsible for the death of Proceso Gayetano; and
accident that presently ensued to be considered the legal or though reluctant to interfere with the findings of fact of a trial
proximate cause thereof. Moreover, by getting out and taking his court when there is a conflict of testimony, the evidence in this
post at the head of the horse, the driver was the person primarily case so clearly preponderates in favor of the defendant, that we
responsible for the control of the animal, and the defendant cannot have no recourse but to reverse the judgment.
be charged with liability for the accident resulting from the action The judgment will therefore be reversed, and the defendant will be
of the horse thereafter. absolved from the complaint; and it is so ordered, without express
Julio Pagnaya testifies to one fact which, if it were fully accredited, finding as to costs of either instance. So ordered.
would possibly put a different complexion on the case; for he says
that when the horse was pulled over to the curb, the defendant, by
way of emphasizing his verbal denunciation of Pagnaya,
gesticulated with one of his arms and incidentally brought his
hand down on the horse's nose. This, according to Pagnaya, is
what made the horse run away. There is no other witness who

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Republic of the Philippines to stick out onto the street, partly blocking the way of oncoming
SUPREME COURT traffic. There were no lights nor any so-called "early warning"
Manila reflector devices set anywhere near the dump truck, front or rear.
FIRST DIVISION The dump truck had earlier that evening been driven home by
G.R. No. L-65295 March 10, 1987 petitioner Armando U. Carbonel, its regular driver, with the
PHOENIX CONSTRUCTION, INC. and ARMANDO U. CARBONEL, permission of his employer Phoenix, in view of work scheduled to
petitioners, be carried out early the following morning, Dionisio claimed that he
vs. tried to avoid a collision by swerving his car to the left but it was
THE INTERMEDIATE APPELLATE COURT and LEONARDO too late and his car smashed into the dump truck. As a result of
DIONISIO, respondents. the collision, Dionisio suffered some physical injuries including
some permanent facial scars, a "nervous breakdown" and loss of
FELICIANO, J: two gold bridge dentures.
In the early morning of 15 November 1975 at about 1:30 a.m. Dionisio commenced an action for damages in the Court of First
private respondent Leonardo Dionisio was on his way home he Instance of Pampanga basically claiming that the legal and
lived in 1214-B Zamora Street, Bangkal, Makati from a proximate cause of his injuries was the negligent manner in which
cocktails-and-dinner meeting with his boss, the general manager of Carbonel had parked the dump truck entrusted to him by his
a marketing corporation. During the cocktails phase of the evening, employer Phoenix. Phoenix and Carbonel, on the other hand,
Dionisio had taken "a shot or two" of liquor. Dionisio was driving countered that the proximate cause of Dionisio's injuries was his
his Volkswagen car and had just crossed the intersection of own recklessness in driving fast at the time of the accident, while
General Lacuna and General Santos Streets at Bangkal, Makati, under the influence of liquor, without his headlights on and
not far from his home, and was proceeding down General Lacuna without a curfew pass. Phoenix also sought to establish that it had
Street, when his car headlights (in his allegation) suddenly failed. exercised due rare in the selection and supervision of the dump
He switched his headlights on "bright" and thereupon he saw a truck driver.
Ford dump truck looming some 2-1/2 meters away from his car. The trial court rendered judgment in favor of Dionisio and against
The dump truck, owned by and registered in the name of petitioner Phoenix and Carbonel and ordered the latter:
Phoenix Construction Inc. ("Phoenix"), was parked on the right (1) To pay plaintiff jointly and severally the sum of P
hand side of General Lacuna Street (i.e., on the right hand side of a 15,000.00 for hospital bills and the replacement of
person facing in the same direction toward which Dionisio's car the lost dentures of plaintiff;
was proceeding), facing the oncoming traffic. The dump truck was (2) To pay plaintiff jointly and severally the sum of P
parked askew (not parallel to the street curb) in such a manner as 1,50,000.-00 as loss of expected income for plaintiff

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brought about the accident in controversy and 2. The award of P150,000.00 as loss
which is the result of the negligence of the of expected income was reduced to
defendants; P100,000.00, basically because
(3) To pay the plaintiff jointly and severally the sum Dionisio had voluntarily resigned his
of P 10,000. as moral damages for the unexpected job such that, in the opinion of the
and sudden withdrawal of plaintiff from his lifetime appellate court, his loss of income
career as a marketing man; mental anguish, "was not solely attributable to the
wounded feeling, serious anxiety, social humiliation, accident in question;" and
besmirched reputation, feeling of economic 3. The award of P100,000.00 as moral
insecurity, and the untold sorrows and frustration damages was held by the appellate
in life experienced by plaintiff and his family since court as excessive and
the accident in controversy up to the present time; unconscionable and hence reduced to
(4) To pay plaintiff jointly and severally the sum of P P50,000.00.
10,000.00 as damages for the wanton disregard of The award of P10,000.00 as
defendants to settle amicably this case with the exemplary damages and P4,500.00 as
plaintiff before the filing of this case in court for a attorney's fees and costs remained
smaller amount. untouched.
(5) To pay the plaintiff jointly and severally the sum This decision of the Intermediate Appellate Court is now before us
of P 4,500.00 due as and for attorney's fees; and on a petition for review.
(6) The cost of suit. (Emphasis supplied) Both the trial court and the appellate court had made fairly explicit
Phoenix and Carbonel appealed to the Intermediate Appellate findings of fact relating to the manner in which the dump truck
Court. That court in CA-G.R. No. 65476 affirmed the decision of was parked along General Lacuna Street on the basis of which
the trial court but modified the award of damages to the following both courts drew the inference that there was negligence on the
extent: part of Carbonel, the dump truck driver, and that this negligence
1. The award of P15,000.00 as was the proximate cause of the accident and Dionisio's injuries. We
compensatory damages was reduced note, however, that both courts failed to pass upon the defense
to P6,460.71, the latter being the only raised by Carbonel and Phoenix that the true legal and proximate
amount that the appellate court cause of the accident was not the way in which the dump truck
found the plaintiff to have proved as had been parked but rather the reckless way in which Dionisio had
actually sustained by him; driven his car that night when he smashed into the dump truck.

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The Intermediate Appellate Court in its questioned decision As to the first issue relating to the curfew pass, it is clear that no
casually conceded that Dionisio was "in some way, negligent" but curfew pass was found on the person of Dionisio immediately after
apparently failed to see the relevance of Dionisio's negligence and the accident nor was any found in his car. Phoenix's evidence here
made no further mention of it. We have examined the record both consisted of the testimony of Patrolman Cuyno who had taken
before the trial court and the Intermediate Appellate Court and we Dionisio, unconscious, to the Makati Medical Center for emergency
find that both parties had placed into the record sufficient evidence treatment immediately after the accident. At the Makati Medical
on the basis of which the trial court and the appellate court could Center, a nurse took off Dionisio's clothes and examined them
have and should have made findings of fact relating to the alleged along with the contents of pockets together with Patrolman Cuyno.
reckless manner in which Dionisio drove his car that night. The 1 Private respondent Dionisio was not able to produce any curfew
petitioners Phoenix and Carbonel contend that if there was pass during the trial. Instead, he offered the explanation that his
negligence in the manner in which the dump truck was parked, family may have misplaced his curfew pass. He also offered a
that negligence was merely a "passive and static condition" and certification (dated two years after the accident) issued by one
that private respondent Dionisio's recklessness constituted an Major Benjamin N. Libarnes of the Zone Integrated Police
intervening, efficient cause determinative of the accident and the Intelligence Unit of Camp Olivas, San Fernando, Pampanga, which
injuries he sustained. The need to administer substantial justice as was said to have authority to issue curfew passes for Pampanga
between the parties in this case, without having to remand it back and Metro Manila. This certification was to the effect that private
to the trial court after eleven years, compels us to address directly respondent Dionisio had a valid curfew pass. This certification did
the contention put forward by the petitioners and to examine for not, however, specify any pass serial number or date or period of
ourselves the record pertaining to Dionisio's alleged negligence effectivity of the supposed curfew pass. We find that private
which must bear upon the liability, or extent of liability, of Phoenix respondent Dionisio was unable to prove possession of a valid
and Carbonel. curfew pass during the night of the accident and that the
There are four factual issues that need to be looked into: (a) preponderance of evidence shows that he did not have such a pass
whether or not private respondent Dionisio had a curfew pass valid during that night. The relevance of possession or non-possession of
and effective for that eventful night; (b) whether Dionisio was a curfew pass that night lies in the light it tends to shed on the
driving fast or speeding just before the collision with the dump other related issues: whether Dionisio was speeding home and
truck; (c) whether Dionisio had purposely turned off his car's whether he had indeed purposely put out his headlights before the
headlights before contact with the dump truck or whether those accident, in order to avoid detection and possibly arrest by the
headlights accidentally malfunctioned moments before the police in the nearby police station for travelling after the onset of
collision; and (d) whether Dionisio was intoxicated at the time of curfew without a valid curfew pass.
the accident.

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On the second issue whether or not Dionisio was speeding home sufficiently startling event as to evoke spontaneous, rather than
that night both the trial court and the appellate court were reflective, reactions from observers who happened to be around at
completely silent. that time. The testimony of Patrolman Cuyno was therefore
The defendants in the trial court introduced the testimony of admissible as part of the res gestae and should have been
Patrolman Cuyno who was at the scene of the accident almost considered by the trial court. Clearly, substantial weight should
immediately after it occurred, the police station where he was have been ascribed to such testimony, even though it did not, as it
based being barely 200 meters away. Patrolman Cuyno testified could not, have purported to describe quantitatively the precise
that people who had gathered at the scene of the accident told him velocity at winch Dionisio was travelling just before impact with the
that Dionisio's car was "moving fast" and did not have its Phoenix dump truck.
headlights on. 2 Dionisio, on the other hand, claimed that he was A third related issue is whether Dionisio purposely turned off his
travelling at a moderate speed at 30 kilometers per hour and had headlights, or whether his headlights accidentally malfunctioned,
just crossed the intersection of General Santos and General just moments before the accident. The Intermediate Appellate
Lacuna Streets and had started to accelerate when his headlights Court expressly found that the headlights of Dionisio's car went off
failed just before the collision took place. 3 as he crossed the intersection but was non-committal as to why
Private respondent Dionisio asserts that Patrolman Cuyno's they did so. It is the petitioners' contention that Dionisio purposely
testimony was hearsay and did not fag within any of the recognized shut off his headlights even before he reached the intersection so
exceptions to the hearsay rule since the facts he testified to were as not to be detected by the police in the police precinct which he
not acquired by him through official information and had not been (being a resident in the area) knew was not far away from the
given by the informants pursuant to any duty to do so. Private intersection. We believe that the petitioners' theory is a more
respondent's objection fails to take account of the fact that the credible explanation than that offered by private respondent
testimony of Patrolman Cuyno is admissible not under the official Dionisio i.e., that he had his headlights on but that, at the
records exception to the hearsay rule 4 but rather as part of the res crucial moment, these had in some mysterious if convenient way
gestae. 5 Testimonial evidence under this exception to the hearsay malfunctioned and gone off, although he succeeded in switching
rule consists of excited utterances made on the occasion of an his lights on again at "bright" split seconds before contact with the
occurrence or event sufficiently startling in nature so as to render dump truck.
inoperative the normal reflective thought processes of the observer A fourth and final issue relates to whether Dionisio was intoxicated
and hence made as a spontaneous reaction to the occurrence or at the time of the accident. The evidence here consisted of the
event, and not the result of reflective thought. 6 testimony of Patrolman Cuyno to the effect that private respondent
We think that an automobile speeding down a street and suddenly Dionisio smelled of liquor at the time he was taken from his
smashing into a stationary object in the dead of night is a smashed car and brought to the Makati Medical Center in an

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unconscious condition. 7 This testimony has to be taken in respondent Dionisio's negligence was an "efficient intervening
conjunction with the admission of Dionisio that he had taken "a cause and that consequently Dionisio's negligence must be
shot or two" of liquor before dinner with his boss that night. We do regarded as the legal and proximate cause of the accident rather
not believe that this evidence is sufficient to show that Dionisio than the earlier negligence of Carbonel. We note that the
was so heavily under the influence of liquor as to constitute his petitioners' arguments are drawn from a reading of some of the
driving a motor vehicle per se an act of reckless imprudence. 8 older cases in various jurisdictions in the United States but we are
There simply is not enough evidence to show how much liquor he unable to persuade ourselves that these arguments have any
had in fact taken and the effects of that upon his physical faculties validity for our jurisdiction. We note, firstly, that even in the United
or upon his judgment or mental alertness. We are also aware that States, the distinctions between "cause" and "condition" which the
"one shot or two" of hard liquor may affect different people 'petitioners would have us adopt have already been "almost entirely
differently. discredited." Professors and Keeton make this quite clear:
The conclusion we draw from the factual circumstances outlined Cause and condition. Many courts have sought to
above is that private respondent Dionisio was negligent the night of distinguish between the active "cause" of the harm
the accident. He was hurrying home that night and driving faster and the existing "conditions" upon which that cause
than he should have been. Worse, he extinguished his headlights operated. If the defendant has created only a passive
at or near the intersection of General Lacuna and General Santos static condition which made the damage possible,
Streets and thus did not see the dump truck that was parked the defendant is said not to be liable. But so far as
askew and sticking out onto the road lane. the fact of causation is concerned, in the sense of
Nonetheless, we agree with the Court of First Instance and the necessary antecedents which have played an
Intermediate Appellate Court that the legal and proximate cause of important part in producing the result it is quite
the accident and of Dionisio's injuries was the wrongful or impossible to distinguish between active forces and
negligent manner in which the dump truck was parked in other passive situations, particularly since, as is invariably
words, the negligence of petitioner Carbonel. That there was a the case, the latter are the result of other active forces
reasonable relationship between petitioner Carbonel's negligence which have gone before. The defendant who spills
on the one hand and the accident and respondent's injuries on the gasoline about the premises creates a "condition,"
other hand, is quite clear. Put in a slightly different manner, the but the act may be culpable because of the danger
collision of Dionisio's car with the dump truck was a natural and of fire. When a spark ignites the gasoline, the
foreseeable consequence of the truck driver's negligence. condition has done quite as much to bring about the
The petitioners, however, urge that the truck driver's negligence fire as the spark; and since that is the very risk
was merely a "passive and static condition" and that private which the defendant has created, the defendant will

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not escape responsibility. Even the lapse of a respondent Dionisio and others similarly situated not to impose
considerable time during which the "condition" upon them the very risk the truck driver had created. Dionisio's
remains static will not necessarily affect liability; one negligence was not of an independent and overpowering nature as
who digs a trench in the highway may still be liable to cut, as it were, the chain of causation in fact between the
to another who fans into it a month afterward. improper parking of the dump truck and the accident, nor to sever
"Cause" and "condition" still find occasional mention the juris vinculum of liability. It is helpful to quote once more from
in the decisions; but the distinction is now almost Professor and Keeton:
entirely discredited. So far as it has any validity at Foreseeable Intervening Causes. If the intervening
all, it must refer to the type of case where the forces cause is one which in ordinary human experience is
set in operation by the defendant have come to rest reasonably to be anticipated or one which the
in a position of apparent safety, and some new force defendant has reason to anticipate under the
intervenes. But even in such cases, it is not the particular circumstances, the defendant may be
distinction between "cause" and "condition" which is negligence among other reasons, because of failure to
important but the nature of the risk and the character guard against it; or the defendant may be negligent
of the intervening cause. 9 only for that reason. Thus one who sets a fire may be
We believe, secondly, that the truck driver's negligence far from required to foresee that an ordinary, usual and
being a "passive and static condition" was rather an indispensable customary wind arising later wig spread it beyond
and efficient cause. The collision between the dump truck and the the defendant's own property, and therefore to take
private respondent's car would in an probability not have occurred precautions to prevent that event. The person who
had the dump truck not been parked askew without any warning leaves the combustible or explosive material exposed
lights or reflector devices. The improper parking of the dump truck in a public place may foresee the risk of fire from
created an unreasonable risk of injury for anyone driving down some independent source. ... In all of these cases
General Lacuna Street and for having so created this risk, the there is an intervening cause combining with the
truck driver must be held responsible. In our view, Dionisio's defendant's conduct to produce the result and in each
negligence, although later in point of time than the truck driver's case the defendant's negligence consists in failure to
negligence and therefore closer to the accident, was not an efficient protect the plaintiff against that very risk.
intervening or independent cause. What the Petitioners describe as Obviously the defendant cannot be relieved from
an "intervening cause" was no more than a foreseeable consequent liability by the fact that the risk or a substantial and
manner which the truck driver had parked the dump truck. In important part of the risk, to which the defendant has
other words, the petitioner truck driver owed a duty to private subjected the plaintiff has indeed come to pass.

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Foreseeable intervening forces are within the scope consequently respondent Dionisio may recover damages though
original risk, and hence of the defendant's negligence. such damages are subject to mitigation by the courts (Article 2179,
The courts are quite generally agreed that Civil Code of the Philippines).
intervening causes which fall fairly in this category Petitioners also ask us to apply what they refer to as the "last clear
will not supersede the defendant's responsibility. chance" doctrine. The theory here of petitioners is that while the
Thus it has been held that a defendant will be petitioner truck driver was negligent, private respondent Dionisio
required to anticipate the usual weather of the had the "last clear chance" of avoiding the accident and hence his
vicinity, including all ordinary forces of nature such injuries, and that Dionisio having failed to take that "last clear
as usual wind or rain, or snow or frost or fog or even chance" must bear his own injuries alone. The last clear chance
lightning; that one who leaves an obstruction on the doctrine of the common law was imported into our jurisdiction by
road or a railroad track should foresee that a vehicle Picart vs. Smith 11 but it is a matter for debate whether, or to what
or a train will run into it; ... extent, it has found its way into the Civil Code of the Philippines.
The risk created by the defendant may include the The historical function of that doctrine in the common law was to
intervention of the foreseeable negligence of others. ... mitigate the harshness of another common law doctrine or rule
[The standard of reasonable conduct may require the that of contributory negligence. 12 The common law rule of
defendant to protect the plaintiff against 'that contributory negligence prevented any recovery at all by a plaintiff
occasional negligence which is one of the ordinary who was also negligent, even if the plaintiff's negligence was
incidents of human life, and therefore to be relatively minor as compared with the wrongful act or omission of
anticipated.' Thus, a defendant who blocks the the defendant. 13 The common law notion of last clear chance
sidewalk and forces the plaintiff to walk in a street permitted courts to grant recovery to a plaintiff who had also been
where the plaintiff will be exposed to the risks of negligent provided that the defendant had the last clear chance to
heavy traffic becomes liable when the plaintiff is run avoid the casualty and failed to do so. 14 Accordingly, it is difficult
down by a car, even though the car is negligently to see what role, if any, the common law last clear chance doctrine
driven; and one who parks an automobile on the has to play in a jurisdiction where the common law concept of
highway without lights at night is not relieved of contributory negligence as an absolute bar to recovery by the
responsibility when another negligently drives into it. plaintiff, has itself been rejected, as it has been in Article 2179 of
--- 10 the Civil Code of the Philippines. 15
We hold that private respondent Dionisio's negligence was "only Is there perhaps a general concept of "last clear chance" that may
contributory," that the "immediate and proximate cause" of the be extracted from its common law matrix and utilized as a general
injury remained the truck driver's "lack of due care" and that rule in negligence cases in a civil law jurisdiction like ours? We do

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not believe so. Under Article 2179, the task of a court, in technical morning, when coupled with the failure to show any effort on the
terms, is to determine whose negligence the plaintiff's or the part of Phoenix to supervise the manner in which the dump truck
defendant's was the legal or proximate cause of the injury. That is parked when away from company premises, is an affirmative
task is not simply or even primarily an exercise in chronology or showing of culpa in vigilando on the part of Phoenix.
physics, as the petitioners seem to imply by the use of terms like Turning to the award of damages and taking into account the
"last" or "intervening" or "immediate." The relative location in the comparative negligence of private respondent Dionisio on one hand
continuum of time of the plaintiff's and the defendant's negligent and petitioners Carbonel and Phoenix upon the other hand, 17 we
acts or omissions, is only one of the relevant factors that may be believe that the demands of substantial justice are satisfied by
taken into account. Of more fundamental importance are the allocating most of the damages on a 20-80 ratio. Thus, 20% of the
nature of the negligent act or omission of each party and the damages awarded by the respondent appellate court, except the
character and gravity of the risks created by such act or omission award of P10,000.00 as exemplary damages and P4,500.00 as
for the rest of the community. The petitioners urge that the truck attorney's fees and costs, shall be borne by private respondent
driver (and therefore his employer) should be absolved from Dionisio; only the balance of 80% needs to be paid by petitioners
responsibility for his own prior negligence because the unfortunate Carbonel and Phoenix who shall be solidarity liable therefor to the
plaintiff failed to act with that increased diligence which had former. The award of exemplary damages and attorney's fees and
become necessary to avoid the peril precisely created by the truck costs shall be borne exclusively by the petitioners. Phoenix is of
driver's own wrongful act or omission. To accept this proposition is course entitled to reimbursement from Carbonel. 18 We see no
to come too close to wiping out the fundamental principle of law sufficient reason for disturbing the reduced award of damages
that a man must respond for the forseeable consequences of his made by the respondent appellate court.
own negligent act or omission. Our law on quasi-delicts seeks to WHEREFORE, the decision of the respondent appellate court is
reduce the risks and burdens of living in society and to allocate modified by reducing the aggregate amount of compensatory
them among the members of society. To accept the petitioners' pro- damages, loss of expected income and moral damages private
position must tend to weaken the very bonds of society. respondent Dionisio is entitled to by 20% of such amount. Costs
Petitioner Carbonel's proven negligence creates a presumption of against the petitioners.
negligence on the part of his employer Phoenix 16 in supervising SO ORDERED.
its employees properly and adequately. The respondent appellate
court in effect found, correctly in our opinion, that Phoenix was not
able to overcome this presumption of negligence. The circumstance
that Phoenix had allowed its truck driver to bring the dump truck
to his home whenever there was work to be done early the following

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Republic of the Philippines Engineer Orlando T. Calibo, Agripino Roranes, and
SUPREME COURT Maximo Patos were on the jeep owned by the
Manila Bacnotan Consolidated Industries, Inc., with Calibo
FIRST DIVISION at the wheel, as it approached from the South
G.R. No. 70493 May 18, 1989 Lizada Bridge going towards the direction of Davao
GLAN PEOPLE'S LUMBER AND HARDWARE, GEORGE LIM, City at about 1:45 in the afternoon of July 4,1979.
FABIO S. AGAD, FELIX LIM and PAUL ZACARIAS y INFANTE, At about that time, the cargo track, loaded with
petitioners, cement bags, GI sheets, plywood, driven by
vs. defendant Paul Zacarias y Infants, coming from the
INTERMEDIATE APPELLATE COURT, CECILIA ALFEREZ VDA. opposite direction of Davao City and bound for Glan,
DE CALIBO, Minors ROYCE STEPHEN, JOYCE JOAN, JANISE South Cotabato, had just crossed said bridge. At
MARIE, JACQUELINE BRIGITTE JOCELINE CORAZON, JULIET about 59 yards after crossing the bridge, the cargo
GERALDINE, JENNIFER JILL, all surnamed CALIBO, truck and the jeep collided as a consequence of
represented by their mother, CECILIA A. VDA. DE CALIBO, which Engineer Calibo died while Roranes and Patos
respondents. sustained physical injuries. Zacarias was unhurt. As
Rufino Mayor and Isidro M. Ampig for petitioners. a result of the impact, the left side of the truck was
Manuel L. Hontanosas for private respondents. slightly damaged while the left side of the jeep,
including its fender and hood, was extensively
NARVASA, J.: damaged. After the impact, the jeep fell and rested
There is a two-fold message in this judgment that bears stating at on its right side on the asphalted road a few meters
the outset. The first, an obvious one, is that it is the objective facts to the rear of the truck, while the truck stopped on
established by proofs presented in a controversy that determine the its wheels on the road.
verdict, not the plight of the persons involved, no matter how On November 27, 1979, the instant case for
deserving of sympathy and commiseration because, for example, damages was filed by the surviving spouse and
an accident of which they are the innocent victims has brought children of the late Engineer Calibo who are
them to. reduced circumstances or otherwise tragically altered residents of Tagbilaran City against the driver and
their lives. The second is that the doctrine laid done many, many owners of the cargo truck.
years ago in Picart vs. Smith 1 continues to be good law to this day. For failure to file its answer to the third party
The facts giving rise to the controversy at bar are tersely and quite complaint, third party defendant, which insured the
accurately recounted by the Trial Court as follows: 2 cargo truck involved, was declared in default.

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The case filed by the heirs of Engineer Calibo his widow and minor investigated or give statements to the police officers.
children, private respondents herein was docketed as This, plus Roranes' waiver of the right to institute
Civil Case No. 3283 of the Court of First Instance of Bohol. 3 criminal proceedings against Zacarias, and the fact
Named defendants in the complaint were "Felix S. Agad, George that indeed no criminal case was ever instituted in
Lim and Felix Lim . . . (who) appear to be the co-owners of the Glan Court against Zacarias, were "telling indications that
People's Lumber and Hardware . . . (and) Paul Zacarias y Infante." 4 they did not attribute the happening to defendant
The defendants' answer however alleged that the lumber and Zacarias' negligence or fault." 7
hardware business was exclusively owned by George Y. Lim, this 3. Roranes' testimony, given in plaintiffs' behalf, was
being evidenced by the Certificate of Registration issued by the "not as clear and detailed as that of . . . Zacarias,"
Bureau of Domestic Trade; Fabio S. Agad was not a co-owner and was "uncertain and even contradicted by the
thereof but "merely employed by . . . George Y. Lim as bookkeeper"; physical facts and the police investigators Dimaano
and Felix Lim had no connection whatever with said business, "he and Esparcia." 8
being a child only eight (8) years of age." 5 4. That there were skid marks left by the truck's
"After (trial, and) a careful evaluation of the evidence, both tires at the scene, and none by the jeep,
testimonial and documentary," the Court reached the conclusion demonstrates that the driver of the truck had
"that the plaintiffs failed to establish by preponderance of evidence applied the brakes and the jeep's driver had not;
the negligence, and thus the liability, of the defendants." and that the jeep had on impact fallen on its right
Accordingly, the Court dismissed the complaint (and defendants' side is indication that it was running at high speed.
counterclaim) "for insufficiency of evidence." Likewise dismissed Under the circumstances, according to the Court,
was third-party complaint presented by the defendants against the given "the curvature of the road and the descending
insurer of the truck. The circumstances leading to the Court's grade of the jeep's lane, it was negligence on the part
conclusion just mentioned, are detailed in the Court's decision, as of the driver of the jeep, Engr. Calibo, for not
follows: reducing his speed upon sight of the truck and
1. Moments before its collission with the truck being failing to apply the brakes as he got within collision
operated by Zacarias, the jeep of the deceased range with the truck."
Calibo was "zigzagging." 6 5. Even if it be considered that there was some
2. Unlike Zacarias who readily submitted himself to antecedent negligence on the part of Zacarias
investigation by the police, Calibo's companions, shortly before the collision, in that he had caused
Roranes (an accountant), and Patos, who suffered his truck to run some 25 centimeters to the left of
injuries on account of the collision, refused to be so the center of the road, Engr. Calibo had the last

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clear chance of avoiding the accident because he "the defendants jointly and solidarily to indemnify the plaintiffs the
still had ample room in his own lane to steer clear of following amounts:
the truck, or he could simply have braked to a full (1) P30,000.00 for the death of Orlando Calibo;
stop. (2) P378,000.00 for the loss of earning capacity of
The Court of Appeals saw things differently. It rendered judgment 9 the deceased
on the plaintiffs' appeal, l0 reversing the decision of the Trial (3) P15,000.00 for attorney's fees;
Court. It found Zacarias to be negligent on the basis of the (4) Cost of suit. 16
following circumstances, to wit: The defendants George Lim, Felix Lim, Fabio S. Agad and Paul
1) "the truck driven by defendant Zacarias occupied Zacarias have appealed to this Court on certiorari and pray for a
the lane of the jeep when the collision occurred,' and reversal of the judgment of the Intermediate Appellate Court which,
although Zacarias saw the jeep from a distance of it is claimed, ignored or ran counter to the established facts. A
about 150 meters, he "did not drive his truck back review of the record confirms the merit of this assertion and
to his lane in order to avoid collision with the persuades this Court that said judgment indeed disregarded facts
oncoming jeep . . .;" 11 what is worse, "the truck clearly and undisputably demonstrated by the proofs. The appealed
driver suddenly applied his brakes even as he knew judgment, consequently, will have to be reversed.
that he was still within the lane of the jeep;" 12 had The finding that "the truck driven by defendant Paul Zacarias
both vehicles stayed in their respective lanes, the occupied the lane of the jeep when the collision occurred" is a loose
collision would never have occurred, they would one, based on nothing more than the showing that at the time of
have passed "along side each other safely;" 13 the accident, the truck driven by Zacarias had edged over the
2) Zacarias had no license at the time; what he painted center line of the road into the opposite lane by a width of
handed to Pfc. Esparcia, on the latter's demand, was twenty-five (25) centimeters. It ignores the fact that by the
the 'driver's license of his co-driver Leonardo uncontradicted evidence, the actual center line of the road was not
Baricuatro;" 14 that indicated by the painted stripe but, according to
3) the waiver of the right to file criminal charges measurements made and testified by Patrolman Juanita Dimaano,
against Zacarias should not be taken against one of the two officers who investigated the accident, correctly lay
"plaintiffs" Roranes and Patos who had the right, thirty-six (36) centimeters farther to the left of the truck's side of
under the law, to opt merely to bring a civil suit. 15 said stripe.
The Appellate Court opined that Zacarias' negligence "gave rise to The unimpugned testimony of Patrolman Dimaano, a witness for
the presumption of negligence on the part of his employer, and the private respondents, is to the effect that the jeep's lane was
their liability is both primary and solidary." It therefore ordered three (3) meters and seventy-five (75) centimeters wide, and that of

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the truck three (3) meters and three (3) centimeters, measured part of its driver to intrude temporarily, and by only as small as a
from the center stripe to the corresponding side lines or outer twenty-five centimeter wide space (less than ten inches), into the
edges of the road. 17 The total width of the road being, therefore, opposite lane in order to insure his vehicle's safety. This, even
six (6) meters and seventy-eight (78) centimeters, the true center supposing that said maneuver was in fact an intrusion into the
line equidistant from both side lines would divide the road into two opposite lane, which was not the case at all as just pointed out.
lanes each three (meters) and thirty-nine (39) centimeters wide. Nor was the Appellate Court correct in finding that Paulino
Thus, although it was not disputed that the truck overrode the Zacarias had acted negligently in applying his brakes instead of
painted stripe by twenty-five (25) centimeters, it was still at least getting back inside his lane upon qqqespying the approaching jeep.
eleven (11) centimeters away from its side of the true center line of Being well within his own lane, as has already been explained, he
the road and well inside its own lane when the accident occurred. had no duty to swerve out of the jeep's way as said Court would
By this same reckoning, since it was unquestionably the jeep that have had him do. And even supposing that he was in fact partly
rammed into the stopped truck, it may also be deduced that it (the inside the opposite lane, coming to a full stop with the jeep still
jeep) was at the time travelling beyond its own lane and intruding thirty (30) meters away cannot be considered an unsafe or
into the lane of the truck by at least the same 11-centimeter width imprudent action, there also being uncontradicted evidence that
of space. the jeep was "zigzagging" 20 and hence no way of telling in which
Not only was the truck's lane, measured from the incorrectly direction it would go as it approached the truck.
located center stripe uncomfortably narrow, given that vehicle's Also clearly erroneous is the finding of the Intermediate Appellate
width of two (2) meters and forty-six (46) centimeters; the adjacent Court that Zacarias had no driver's license at the time. The traffic
road shoulder was also virtually impassable, being about three (3) accident report attests to the proven fact that Zacarias voluntarily
inches lower than the paved surface of the road and "soft--not firm surrendered to the investigating officers his driver's license, valid
enough to offer traction for safe passage besides which, it sloped for 1979, that had been renewed just the day before the accident,
gradually down to a three foot-deep ravine with a river below. 18 on July 3, 1979. 21 The Court was apparently misled by the
The truck's lane as erroneously demarcated by the center stripe circumstance that when said driver was first asked to show his
gave said vehicle barely half a meter of clearance from the edge of license by the investigators at the scene of the collision, he had
the road and the dangerous shoulder and little room for maneuver, first inadvertently produced the license of a fellow driver, Leonardo
in case this was made necessary by traffic contingencies or road Baricuatro, who had left said license in Davao City and had asked
conditions, if it always kept to said lane. It being also shown that Zacarias to bring it back to him in Glan, Cotabato. 22
the accident happened at or near the point of the truck's approach The evidence not only acquits Zacarias of any negligence in the
to a curve, 19 which called for extra precautions against driving too matter; there are also quite a few significant indicators that it was
near the shoulder, it could hardly be accounted negligent on the rather Engineer Calibo's negligence that was the proximate cause

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of the accident. Zacarias had told Patrolman Dimaano at the scene Even, however, ignoring these telltale indicia of negligence on the
of the collision and later confirmed in his written statement at the part of Calibo, and assuming some antecedent negligence on the
police headquarters 23 that the jeep had been "zigzagging," which is part of Zacarias in failing to keep within his designated lane,
to say that it was travelling or being driven erratically at the time. incorrectly demarcated as it was, the physical facts, either
The other investigator, Patrolman Jose Esparcia, also testified that expressly found by the Intermediate Appellate Court or which may
eyewitnesses to the accident had remarked on the jeep's be deemed conceded for lack of any dispute, would still absolve the
"zigzagging." 24 There is moreover more than a suggestion that latter of any actionable responsibility for the accident under the
Calibo had been drinking shortly before the accident. The decision rule of the last clear chance.
of the Trial Court adverts to further testimony of Esparcia to the Both drivers, as the Appellate Court found, had had a full view of
effect that three of Calibo's companions at the beach party he was each other's vehicle from a distance of one hundred fifty meters.
driving home from when the collision occurred, who, having left Both vehicles were travelling at a speed of approximately thirty
ahead of him went to the scene when they heard about the kilometers per hour. 26 The private respondents have admitted that
accident, had said that there had been a drinking spree at the the truck was already at a full stop when the jeep plowed into it.
party and, referring to Calibo, had remarked: "Sabi na huag nang And they have not seen fit to deny or impugn petitioners'
mag drive . . . . pumipilit," (loosely translated, "He was advised not imputation that they also admitted the truck had been brought to
to drive, but he insisted.") a stop while the jeep was still thirty meters away. 27 From these
It was Calibo whose driver's license could not be found on his facts the logical conclusion emerges that the driver of the jeep had
person at the scene of the accident, and was reported by his what judicial doctrine has appropriately called the last clear
companions in the jeep as having been lost with his wallet at said chance to avoid the accident, while still at that distance of thirty
scene, according to the traffic accident report, Exhibit "J". Said meters from the truck, by stopping in his turn or swerving his jeep
license unexplainedly found its way into the record some two years away from the truck, either of which he had sufficient time to do
later. while running at a speed of only thirty kilometers per hour. In
Reference has already been made to the finding of the Trial Court those circumstances, his duty was to seize that opportunity of
that while Zacarias readily submitted to interrogation and gave a avoidance, not merely rely on a supposed right to expect, as the
detailed statement to the police investigators immediately after the Appellate Court would have it, the truck to swerve and leave him a
accident, Calibo's two companions in the jeep and supposed clear path.
eyewitnesses, Agripino Roranes and Maximo Patos, refused to give The doctrine of the last clear chance provides as valid and
any statements. Furthermore, Roranes who, together with Patos, complete a defense to accident liability today as it did when
had sustained injuries as a result of the collision, waived his right invoked and applied in the 1918 case of Picart vs. Smith, supra,
to file a criminal case against Zacarias. 25 which involved a similar state of facts. Of those facts, which should

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be familiar to every student of law, it is only necessary to recall the circumstances the law is that the person who has
summary made in the syllabus of this Court's decision that: the last fair chance to avoid the impending harm
(t)he plaintiff was riding a pony on a bridge. Seeing and fails to do so is chargeable with the
an automobile ahead he improperly pulled his horse consequences, without reference to the prior
over to the railing on the right. The driver of the negligence of the other party.
automobile, however guided his car toward the Since said ruling clearly applies to exonerate petitioner Zacarias
plaintiff without diminution of speed until he was and his employer (and co-petitioner) George Lim, an inquiry into
only few feet away. He then turned to the right but whether or not the evidence supports the latter's additional defense
passed so closely to the horse that the latter being of due diligence in the selection and supervision of said driver is no
frightened, jumped around and was killed by the longer necessary and wig not be undertaken. The fact is that there
passing car. . . . . is such evidence in the record which has not been controverted.
Plaintiff Picart was thrown off his horse and suffered contusions It must be pointed out, however, that the Intermediate Appellate
which required several days of medical attention. He sued the Court also seriously erred in holding the petitioners Pablo S. Agad
defendant Smith for the value of his animal, medical expenses and and Felix Lim solidarily liable for the damages awarded in its
damage to his apparel and obtained judgment from this Court appealed decision, as alleged owners, with petitioner George Lim, of
which, while finding that there was negligence on the part of both Glan People's Lumber and Hardware, employer of petitioner
parties, held that that of the defendant was the immediate and Zacarias. This manifestly disregarded, not only the certificate of
determining cause of the accident and that of the plaintiff ". . . the registration issued by the Bureau of Domestic Trade identifying
more remote factor in the case": Glan People's Lumber and Hardware as a business name registered
It goes without saying that the plaintiff himself was by George Lim, 28 but also unimpugned allegations into the
not free from fault, for he was guilty of antecedent petitioners' answer to the complaint that Pablo S. Agad was only an
negligence in planting himself on the wrong side of employee of George Lim and that Felix Lim, then a child of only
the road. But as we have already stated, the eight (8) years, was in no way connected with the business.
defendant was also negligent; and in such case the In conclusion, it must also be stated that there is no doubt of this
problem always is to discover which agent is Court's power to review the assailed decision of the Intermediate
immediately and directly responsible. It will be noted Appellate Court under the authority of precedents recognizing
that the negligent acts of the two parties were not exceptions to the familiar rule binding it to observe and respect the
contemporaneous, since the negligence of the latter's findings of fact. Many of those exceptions may be cited to
defendant succeeded the negligence of the plaintiff support the review here undertaken, but only the most obvious
by an appreciable interval. Under these that said findings directly conflict with those of the Trial Court

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will suffice. 29 In the opinion of this Court and after a careful review
of the record, the evidence singularly fails to support the findings
of the Intermediate Appellate Court which, for all that appears,
seem to have been prompted rather by sympathy for the heirs of
the deceased Engineer Calibo than by an objective appraisal of the
proofs and a correct application of the law to the established facts.
Compassion for the plight of those whom an accident has robbed of
the love and support of a husband and father is an entirely natural
and understandable sentiment. It should not, however, be allowed
to stand in the way of, much less to influence, a just verdict in a
suit at law.
WHEREFORE, the appealed judgment of the Intermediate Appellate
Court is hereby REVERSED, and the complaint against herein
petitioners in Civil Case No. 3283 of the Court of First Instance of
Bohol, Branch IV, is DISMISSED. No pronouncement as to costs.
SO ORDERED.

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Republic of the Philippines executed a Special Power of Attorney authorizing the latter to
SUPREME COURT mortgage two parcels of land situated in San Dionisio, (BF Homes)
Manila Paranaque, Metro Manila, each lot with semi-concrete residential
THIRD DIVISION house existing thereon, and respectively covered by Transfer
G.R. No. 112160 February 28, 2000 Certificate of Title No. 54366 in his (Osmundo's) name and
OSMUNDO S. CANLAS and ANGELINA CANLAS, petitioner, Transfer Certificate of Title No. S-78498 in the name of his wife
vs. Angelina Canlas.
COURT OF APPEALS, ASIAN SAVINGS BANK, MAXIMO C. Subsequently, Osmundo Canlas agreed to sell the said parcels of
CONTRARES and VICENTE MAOSCA, respondents. land to Vicente Maosca, for and in consideration of P850,000.00,
PURISIMA, J.: P500,000.00 of which payable within one week, and the balance of
At bar is a Petition for Review on Certiorari under Rule 45 of the P350,000.00 to serve as his (Osmundo's) investment in the
Rules of Court, seeking to review and set aside the Decision 1 of the business. Thus, Osmundo Canlas delivered to Vicente Maosca the
Court of Appeals in CA-G.R. CV No. 25242, which reversed the transfer certificates of title of the parcels of land involved. Vicente
Decision2 of Branch 59 of the Regional Trial Court of Makati City in Maosca, as his part of the transaction, issued two postdated
Civil Case No. M-028; the dispositive portion of which reads: checks in favor of Osmundo Canlas in the amounts of P40,000.00
WHEREFORE, the decision appealed from is hereby and P460,000.00, respectively, but it turned out that the check
REVERSED and SET ASIDE and a new one is hereby covering the bigger amount was not sufficiently funded. 4
entered DISMISSING the complaint of the spouses On September 3, 1982, Vicente Maosca was able to mortgage the
Osmundo and Angelina Canlas. On the counterclaim of same parcels of land for P100,000.00 to a certain Attorney Manuel
defendant Asian Savings Bank, the plaintiffs Canlas Magno, with the help of impostors who misrepresented themselves
spouses are hereby ordered to pay the defendant Asian as the spouses, Osmundo Canlas and Angelina Canlas.5
Savings Bank the amount of P50,000.00 as moral and On September 29, 1982, private respondent Vicente Maosca was
exemplary damages, plus P15,000.00 as and for attorney's granted a loan by the respondent Asian Savings Bank (ASB) in the
fees. amount of P500,000.00, with the use of subject parcels of land as
With costs against appellees. security, and with the involvement of the same impostors who
SO ORDERED.3 again introduced themselves as the Canlas spouses. 6 When the
The facts that matter: loan it extended was not paid, respondent bank extrajudicially
Sometime in August, 1982, the petitioner, Osmundo S. Canlas, foreclosed the mortgage.
and private respondent, Vicente Maosca, decided to venture in On January 15, 1983, Osmundo Canlas wrote a letter informing
business and to raise the capital needed therefor. The former then the respondent bank that the execution of subject mortgage over

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the two parcels of land in question was without their (Canlas 4. On defendant ASB's crossclaim: ordering the
spouses) authority, and request that steps be taken to annul cross-defendant Vicente Maosca to pay the
and/or revoke the questioned mortgage. On January 18, 1983, defendant ASB the sum of P350,000.00,
petitioner Osmundo Canlas also wrote the office of Sheriff Maximo representing the amount which he received as
O. Contreras, asking that the auction sale scheduled on February proceeds of the loan secured by the void mortgage,
3, 1983 be cancelled or held in abeyance. But respondents Maximo plus interest at the legal rate, starting February 3,
C. Contreras and Asian Savings Bank refused to heed petitioner 1983, the date when the original complaint was
Canlas' stance and proceeded with the scheduled auction sale. 7 filed, until the amount is fully paid;
Consequently, on February 3, 1983 the herein petitioners 5. With costs against the defendants.
instituted the present case for annulment of deed of real estate SO ORDERED.10
mortgage with prayer for the issuance of a writ of preliminary From such Decision below, Asian Savings Bank appealed to the
injunction; and on May 23, 1983, the trial court issued an Order Court of Appeals, which handed down the assailed judgment of
restraining the respondent sheriff from issuing the corresponding reversal, dated September 30, 1983, in CA-G.R. CV No. 25242.
Certificate of Sheriff's Sale.8 Dissatisfied therewith, the petitioners found their way to this Court
For failure to file his answer, despite several motions for extension via the present Petition; theorizing that:
of time for the filing thereof, Vicente Maosca was declared in I
default.9 RESPONDENT COURT OF APPEALS ERRED IN HOLDING THAT
On June 1, 1989, the lower court a quo came out with a decision THE MORTGAGE OF THE PROPERTIES SUBJECT OF THIS CASE
annulling subject deed of mortgage and disposing, thus: WAS VALID.
Premises considered, judgment is hereby rendered as II
follows.1wphi1.nt RESPONDENT COURT OF APPEALS ERRED IN HIOLDING THAT
1. Declaring the deed of real estate mortgage PETITIONERS ARE NOT ENTITLED TO RELIEF BECAUSE THEY
(Exhibit "L") involving the properties of the plaintiffs WERE NEGLIGENT AND THEREFORE MUST BEAR THE LOSS.
as null and void; III
2. Declaring the public auction sale conducted by RESPONDENT COURT OF APPEALS ERRED IN HOLDING THAT
the defendant Sheriff, involving the same properties RESPONDENT ASB EXERCISED DUE DILIGENCE IN GRANTING
as illegal and without binding effect; THE LOAN APPLICATION OF RESPONDENT.
3. Ordering the defendants, jointly and severally, to IV
pay the plaintiffs the sum of P20,000.00 RESPONDENT COURT OF APPEALS ERRED IN HOLDING THAT
representing attorney's fees; RESPONDENT ASB DID NOT ACT WITH BAD FAITH IN

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PROCEEDING WITH THE FORECLOSURE SALE OF THE single identification card was exhibited by the said impostors to
PROPERTIES. show their true identity; and yet, the bank acted on their
V representations simply on the basis of the residence certificates
RESPONDENT COURT OF APPEALS ERRED IN AWARDING bearing signatures which tended to match the signatures affixed on
RESPONDENT ASB MORAL DAMAGES.11 a previous deed of mortgage to a certain Atty. Magno, covering the
The Petition is impressed with merit. same parcels of land in question. Felizado Mangubat, Assistant
Art. 1173 of the Civil Code, provides: Vice President of Asian Savings Bank, thus testified inter alia:
Art. 1173. The fault or negligence of the obligor consist in xxx xxx xxx
the omission of that diligence which is required by the Q: According to you, the basis for your having
nature of the obligation and corresponds with the recommended for the approval of MANASCO's (sic) loan
circumstances of the persons, of the time and of the place. particularly that one involving the property of plaintiff in
When negligence shows bad faith, the provisions of articles this case, the spouses OSMUNDO CANLAS and ANGELINA
1171 and 2201, paragraph 2, shall apply. CANLAS, the basis for such approval was that according to
If the law or contract does not state the diligence which is to you all the signatures and other things taken into account
be observed in the performance, that which is expected of a matches with that of the document previously executed by
good father of a family shall be required. (1104) the spouses CANLAS?
The degree of diligence required of banks is more than that of a Q: That is the only basis for accepting the signature
good father of a family;12 in keeping with their responsibility to on the mortgage, the basis for the recommendation of the
exercise the necessary care and prudence in dealing even on a approval of the loan are the financial statement of
registered or titled property. The business of a bank is affected with MAOSCA?
public interest, holding in trust the money of the depositors, which A: Yes; among others the signature and TAX Account
bank deposits the bank should guard against loss due to Number, Residence Certificate appearing on the previous
negligence or bad faith, by reason of which the bank would be loan executed by the spouses CANLAS, I am referring to
denied the protective mantle of the land registration law, accorded EXHIBIT 5, mortgage to ATTY. MAGNO, those were made
only to purchasers or mortgagees for value and in good faith. 13 the basis.
In the case under consideration, from the evidence on hand it can A: That is just the basis of accepting the signature,
be gleaned unerringly that respondent bank did not observe the because at that time the loan have been approved already
requisite diligence in ascertaining or verifying the real identity of on the basis of the financial statement of the client the
the couple who introduced themselves as the spouses Osmundo Bank Statement. Wneh (sic) it was approved we have to
Canlas and Angelina Canlas. It is worthy to note that not even a base it on the Financial statement of the client, the

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signatures were accepted only for the purpose of signing the A: Residence Certificate.
mortgage not for the approval, we don't (sic) approve loans Q: Is that all, is that the only requirement?
on the signature. A: We requested for others but they could not
ATTY. CLAROS: produce, and because they presented to us the Residence
Would you agree that as part of ascertaining the Certificate which matches on the signature on the
identify of the parties particularly the mortgage, you Residence Certificate in favor of Atty. Magno.14
don't consider also the signature, the Residence Evidently, the efforts exerted by the bank to verify the identity of
Certificate, the particular address of the parties the couple posing as Osmundo Canlas and Angelina Canlas fell
involved. short of the responsibility of the bank to observe more than the
A: I think the question defers (sic) from what you diligence of a good father of a family. The negligence of respondent
asked a while ago. bank was magnified by the fact that the previous deed of mortgage
Q: Among others? (which was used as the basis for checking the genuineness of the
A: We have to accept the signature on the basis of signatures of the supposed Canlas spouses) did not bear the tax
the other signatures given to us it being a public account number of the spouses,15 as well as the Community Tax
instrument. Certificate of Angelina Canlas.16 But such fact notwithstanding, the
ATTY. CARLOS: bank did not require the impostors to submit additional proof of
You mean to say the criteria of ascertaining the their true identity.
identity of the mortgagor does not depend so much Under the doctrine of last clear chance, which is applicable here,
on the signature on the residence certificate they the respondent bank must suffer the resulting loss. In essence,
have presented. the doctrine of last clear chance is to the effect that where
A: We have to accept that. both parties are negligent but the negligent act of one is
xxx xxx xxx appreciably later in point of time than that of the other, or
A: We accepted the signature on the basis of the where it is impossible to determine whose fault or negligence
mortgage in favor of ATTY. MAGNO duly notarized which I brought about the occurrence of the incident, the one who had
have been reiterrting (sic) entitled to full faith considering the last clear opportunity to avoid the impending harm but
that it is a public instrument. failed to do so, is chargeable with the consequences arising
ATTY. CARLOS: therefrom. Stated differently, the rule is that the antecedent
What other requirement did you take into account in negligence of a person does not preclude recovery of damages
ascertaining the identification of the parties caused by the supervening negligence of the latter, who had
particularly the mortgagor in this case.

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the last fair chance to prevent the impending harm by the And during that meeting, Osmundo did not say who he
exercise of due diligence.17 really is, but even let Maosca introduced him again as
Assuming that Osmundo Canlas was negligent in giving Vicente "Leonardo Rey", which all the more indicates that he
Maosca the opportunity to perpetrate the fraud, by entrusting to connived with Maosca in deceiving the defendant bank.
latter the owner's copy of the transfer certificates of title of subject Finally after the loan was finally approved, Osmundo
parcels of land, it cannot be denied that the bank had the last clear accompanied Maosca to the bank when the loan was
chance to prevent the fraud, by the simple expedient of faithfully released. At that time, a manger's check for P200,000.00
complying with the requirements for banks to ascertain the identity was issued in the name of Oscar Motorworks, which
of the persons transacting with them. Osmundo admits he owns and operates.
For not observing the degree of diligence required of banking Collectively, the foregoing circumstances cannot but
institutions, whose business is impressed with public interest, conjure to a single conclusion that Osmundo active
respondent Asian Savings Bank has to bear the loss sued upon. participated in the loan application of defendant Asian
In ruling for respondent bank, the Court of Appeals concluded that Savings Bank, which culminated in his receiving a portion
the petitioner Osmundo Canlas was a party to the fraudulent of the process thereof:18
scheme of Maosca and therefore, estopped from impugning the A meticulous and painstaking scrutiny of the Records on hand,
validity of subject deed of mortgage; ratiocinating thus: reveals, however, that the findings arrived at by the Court of
xxx xxx xxx Appeals are barren of any sustainable basis. For instance, the
Thus, armed with the titles and the special power of execution of the deeds of mortgages constituted by Maosca on
attorney, Maosca went to the defendant bank and applied subject pieces of property of petitioners were made possible not by
for a loan. And when Maosca came over to the bank to the Special Power of Attorney executed by Osmundo Canlas in
submit additional documents pertinent to his loan favor of Maosca but through the use of impostors who
application, Osmundo Canlas was with him, together with a misrepresented themselves as the spouses Angelina Canlas and
certain Rogelio Viray. At that time, Osmundo Canlas was Osmundo Canlas. It cannot be said therefore, that the petitioners
introduced to the bank personnel as "Leonardo Rey". authorized Vicente Maosca to constitute the mortgage on their
When he was introduced as "Leonardo Rey" for the first parcels of land.
time Osmundo should have corrected Maosca right away. What is more, Osmundo Canlas was introduced as "Leonardo Rey"
But he did not. Instead, he even allowed Maosca to avail of by Vicente Maosca, only on the occasion of the luncheon meeting
his (Osmundo's) membership privileges at the Metropolitan at the Metropolitan Club.19 Thereat, the failure of Osmundo Canlas
Club when Maosca invited two officers of the defendant to rectify Maosca's misrepresentations could not be taken as a
bank to a luncheon meeting which Osmundo also attended. fraudulent act. As well explained by the former, he just did not

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want to embarrass Maosca, so that he waited for the end of the Not only that; while it is true that Osmundo Canlas was with
meeting to correct Maosca.20 Vicente Maosca when the latter submitted the documents needed
Then, too, Osmundo Canlas recounted that during the said for his loan application, and when the check of P200,000.00 was
luncheon meeting, they did not talk about the security or collateral released, the former did not know that the collateral used by
for the loan of Maosca with ASB.21 So also, Mrs. Josefina Rojo, Maosca for the said loan were their (Canlas spouses') properties.
who was the Account Officer of Asian Savings Bank when Maosca Osmundo happened to be with Maosca at the time because he
applied for subject loan, corroborated the testimony of Osmundo wanted to make sure that Maosca would make good his promise
Canlas, she testified: to pay the balance of the purchase price of the said lots out of the
xxx xxx xxx proceeds of the loan. 23
QUESTION: Now could you please describe out the The receipt by Osmundo Canlas of the P200,000.00 check from
lunch conference at the Metro Club in Makati? ASB could not estop him from assailing the validity of the mortgage
ANSWER: Mr. Mangubat, Mr. Maosca and I did not because the said amount was in payment of the parcels of land he
discuss with respect to the loan application and discuss sold to Maosca.24
primarily his business. What is decisively clear on record is that Maosca managed to keep
xxx xxx xxx Osmundo Canlas uninformed of his (Maosca's) intention to use
QUESTION: So, what is the main topic of your the parcels of land of the Canlas spouses as security for the loan
discussion during the meeting? obtained from Asian Savings Bank. Since Vicente Maosca showed
ANSWER: The main topic war then, about his Osmundo Canlas several certificates of title of lots which,
business although, Mr. Leonardo Rey, who actually turned according to Maosca were the collaterals, Osmundo Canlas was
out as Mr. Canlas, supplier of Mr. Maosca. confident that their (Canlases') parcels of land were not involved in
QUESTION: I see . . . other than the business of Mr. the loan transactions with the Asian Savings Bank.25 Under the
Maosca, were there any other topic discussed? attendant facts and circumstances, Osmundo Canlas was
ANSWER: YES. undoubtedly negligent, which negligence made them (petitioners)
QUESTION: And what was the topic: undeserving of an award of attorney's fees.
ANSWER: General Economy then. Settled is the rule that a contract of mortgage must be constituted
xxx xxx x x x22 only by the absolute owner on the property mortgaged;26 a
Verily, Osmundo Canlas was left unaware of the illicit plan of mortgage, constituted by an impostor is void.27 Considering that it
Maosca, explaining thus why he (Osmundo) did not bother to was established indubitably that the contract of mortgage sued
correct what Maosca misrepresented and to assert ownership over upon was entered into and signed by impostors who
the two parcels of land in question. misrepresented themselves as the spouses Osmundo Canlas and

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Angelina Canlas, the Court is of the ineluctible conclusion and
finding that subject contract of mortgage is a complete nullity.
WHEREFORE, the Petition is GRANTED and the Decision of the
Court of Appeals, dated September 30, 1993, in CA-G.R. CV No.
25242 SET ASIDE. The Decision of Branch 59 of the Regional Trial
Court of Makati City in Civil Case No. M-028 is hereby
REINSTATED. No pronouncement as to costs.
SO ORDERED.1

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Republic of the Philippines Berenguel4 (Berenguel) and Deocampo. Respondent alleged that his
SUPREME COURT pick-up was slowing down to about five to ten kilometers per hour
Manila (kph) and was making a left turn preparatory to turning south
SECOND DIVISION when it was bumped from behind by the crewcab which was
G.R. No. 153076 June 21, 2007 running at around 60 to 70 kph. The crewcab stopped 21 meters
LAPANDAY AGRICULTURAL and DEVELOPMENT from the point of impact. Respondent alleged that he heard a
CORPORATION (LADECO), HENRY BERENGUEL, and screeching sound before the impact. Respondent was seated beside
APOLONIO R. DEOCAMPO, petitioners, the driver and was looking at the speedometer when the accident
vs. took place. Respondent testified that Borres made a signal because
MICHAEL RAYMOND ANGALA, respondent. he noticed a blinking light while looking at the speedometer. 5
DECISION Respondent sent a demand letter to LADECO for the payment of
CARPIO, J.: the damages he incurred because of the accident but he did not
The Case receive any reply. Thus, respondent filed the case against LADECO,
Before the Court is a petition for review1 assailing the 25 July 2001 Berenguel, and Deocampo.
Decision2 and 11 March 2002 Resolution3 of the Court of Appeals Deocampo alleged that the pick-up and the crewcab he was driving
in CA-G.R. CV No. 51134. were both running at about 40 kph. The pick-up was running
The Antecedent Facts along the outer lane. The pick-up was about 10 meters away when
On 4 May 1993, at about 2:45 p.m., a Datsun crewcab with plate it made a U-turn towards the left. Deocampo testified that he did
no. PEC-903 driven by Apolonio Deocampo (Deocampo) bumped not see any signal from the pick-up.6 Deocampo alleged that he
into a 1958 Chevy pick-up with plate no. MAM-475 owned by tried to avoid the pick-up but he was unable to avoid the collision.
Michael Raymond Angala (respondent) and driven by Bernulfo Deocampo stated that he did not apply the brakes because he
Borres (Borres). Lapanday Agricultural and Development knew the collision was unavoidable. Deocampo admitted that he
Corporation (LADECO) owned the crewcab which was assigned to stepped on the brakes only after the collision.
its manager Manuel Mendez (Mendez). Deocampo was the driver The Ruling of the Trial Court
and bodyguard of Mendez. Both vehicles were running along Rafael In its 3 March 1995 Decision, 7 the Regional Trial Court of Davao
Castillo St., Agdao, Davao City heading north towards Lanang, City, Branch 15 (trial court) ruled:
Davao City. The left door, front left fender, and part of the front WHEREFORE, judgment is hereby rendered ordering the
bumper of the pick-up were damaged. defendants LADECO and Apolonio Deocampo to solidarily
Respondent filed an action for Quasi-Delict, Damages, and pay the plaintiffs the following sums:
Attorneys Fees against LADECO, its administrative officer Henry

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1. Twenty three thousand two hundred (P23,200.00) Article 2180 of the Civil Code, the negligence of the driver is
pesos as actual damages. presumed to be the negligence of the owner of the vehicle.
2. Ten thousand (P10,000.00) pesos as moral The dispositive portion of the Court of Appeals Decision reads:
damages. WHEREFORE, premises considered, the appeal is
3. Ten thousand (P10,000.00) pesos as attorneys DISMISSED for lack of merit, and the assailed Decision of
fees. the Court a quo in Civil Case No. 22067-93 is AFFIRMED in
4. Costs of suit. toto. Costs against defendants-appellants.
SO ORDERED.8 SO ORDERED.11
The trial court found that the crewcab was running very fast while Petitioners filed a motion for reconsideration. In its 11 March 2002
following the pick-up and that the crewcabs speed was the Resolution, the Court of Appeals denied the motion for lack of
proximate cause of the accident. The trial court observed that the merit.
crewcab stopped 21 meters away from the point of impact despite Hence, the petition before this Court.
Deocampos claim that he stepped on the brakes moments after the The Issues
collision. The trial court ruled that Deocampo had the last The issues before the Court are the following:
opportunity to avoid the accident. 1. Whether the provisions of Section 45(b) of Republic Act
The trial court found that Berenguel was not liable because he was No. 413612 (RA 4136) and Article 2185 of the Civil Code
not the owner of the crewcab. apply to this case; and
LADECO and Deocampo (petitioners)9 filed a motion for 2. Whether respondent is entitled to the damages awarded.
reconsideration. The trial court denied petitioners motion in its 13 The Ruling of this Court
June 1995 Order.10 The petition is partly meritorious.
Petitioners filed an appeal before the Court of Appeals. Both Drivers are Negligent
The Ruling of the Court of Appeals Both the trial court and the Court of Appeals found that Deocampo
The Court of Appeals affirmed in toto the trial courts decision. was at fault because he was driving very fast prior to the collision.
The Court of Appeals sustained the finding of the trial court that The Court of Appeals sustained the trial courts finding that
Deocampo was negligent. The Court of Appeals applied the doctrine Deocampo was running more than the normal cruising speed. Both
of last clear chance and ruled that Deocampo had the the trial court and the Court of Appeals noted that the crewcab
responsibility of avoiding the pick-up. stopped 21 meters away from the point of impact. Deocampo
The Court of Appeals also sustained the solidary liability of admitted that he stepped on the brakes only after the collision.
LADECO and Deocampo. The Court of Appeals ruled that under Petitioners allege that Borres did not take the proper lane before
executing the U-turn. Petitioners allege that Borres violated Section

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45(b) of RA 4136 and it was his recklessness that was the very fast before the collision, as found by both the trial court and
proximate cause of the accident. the Court of Appeals. We sustain this finding since factual findings
Section 45(b) of RA 4136 states: of the Court of Appeals affirming those of the trial court are
Sec. 45. Turning at intersections. x x x conclusive and binding on this Court.15 Further, the crewcab
(b) The driver of a vehicle intending to turn to the left shall stopped 21 meters from the point of impact. It would not have
approach such intersection in the lane for traffic to the happened if Deocampo was not driving very fast.
right of and nearest to the center line of the highway, and, Doctrine of Last Clear Chance Applies
in turning, shall pass to the left of the center of the Since both parties are at fault in this case, the doctrine of last clear
intersection, except that, upon highways laned for traffic chance applies.
and upon one-way highways, a left turn shall be made from The doctrine of last clear chance states that where both parties are
the left lane of traffic in the direction in which the vehicle is negligent but the negligent act of one is appreciably later than that
proceeding. of the other, or where it is impossible to determine whose fault or
Petitioners further allege that since Borres was violating a traffic negligence caused the loss, the one who had the last clear
rule at the time of the accident, respondent and Borres were the opportunity to avoid the loss but failed to do so is chargeable with
parties at fault. Petitioners cite Article 2185 of the Civil Code, thus: the loss.16 In this case, Deocampo had the last clear chance to
Art. 2185. Unless there is proof to the contrary, it is avoid the collision. Since Deocampo was driving the rear vehicle, he
presumed that a person driving a motor vehicle has been had full control of the situation since he was in a position to
negligent if at the time of the mishap, he was violating any observe the vehicle in front of him.17 Deocampo had the
traffic regulation. responsibility of avoiding bumping the vehicle in front of him. 18 A
We rule that both parties were negligent in this case. Borres was at U-turn is done at a much slower speed to avoid skidding and
the outer lane when he executed a U-turn. Following Section 45(b) overturning, compared to running straight ahead. 19 Deocampo
of RA 4136, Borres should have stayed at the inner lane which is could have avoided the vehicle if he was not driving very fast while
the lane nearest to the center of the highway. However, Deocampo following the pick-up. Deocampo was not only driving fast, he also
was equally negligent. Borres slowed down the pick-up preparatory admitted that he did not step on the brakes even upon seeing the
to executing the U-turn. Deocampo should have also slowed down pick-up. He only stepped on the brakes after the collision.
when the pick-up slowed down. Deocampo admitted that he Petitioners are Solidarily Liable
noticed the pick-up when it was still about 20 meters away from LADECO alleges that it should not be held jointly and severally
him.13 Vehicular traffic was light at the time of the incident. The liable with Deocampo because it exercised due diligence in the
pick-up and the crewcab were the only vehicles on the road. 14 supervision and selection of its employees. Aside from this
Deocampo could have avoided the crewcab if he was not driving statement, LADECO did not proffer any proof to show how it

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exercised due diligence in the supervision and selection of its
employees. LADECO did not show its policy in hiring its drivers, or
the manner in which it supervised its drivers. LADECO failed to
substantiate its allegation that it exercised due diligence in the
supervision and selection of its employees.
Hence, we hold LADECO solidarily liable with Deocampo.
Respondent is Entitled to Moral Damages
We sustain the award of moral damages. Moral damages are
awarded to allow a plaintiff to obtain means, diversion, or
amusement that will serve to alleviate the moral suffering he has
undergone due to the defendants culpable action.20 The trial court
found that respondent, who was on board the pick-up when the
collision took place, suffered shock, serious anxiety, and fright
when the crewcab bumped his pick-up. We sustain the trial court
and the Court of Appeals in ruling that respondent sufficiently
showed that he suffered shock, serious anxiety, and fright which
entitle him to moral damages.
Both the trial court and the Court of Appeals failed to give any
justification for the award of attorneys fees. Awards of attorneys
fees must be based on findings of fact and of law and stated in the
decision of the trial court.21 Further, no premium should be placed
on the right to litigate.22 Hence, we delete the award of attorneys
fees.
WHEREFORE, we AFFIRM the 25 July 2001 Decision and 11
March 2002 Resolution of the Court of Appeals in CA-G.R. CV No.
51134 with MODIFICATION by deleting the award of attorneys
fees.
SO ORDERED.

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Republic of the Philippines its account, and were instead deposited to the account of one
SUPREME COURT Bienvenido Cotas, allegedly due to the gross and inexcusable
Manila negligence of the petitioner bank.
FIRST DIVISION RMC maintained two (2) separate current accounts, Current
Account Nos. 53-01980-3 and 53-01748-7, with the Pasig Branch
G.R. No. 97626 March 14, 1997 of PBC in connection with its business of selling appliances.
PHILIPPINE BANK OF COMMERCE, now absorbed by In the ordinary and usual course of banking operations, current
PHILIPPINE COMMERCIAL INTERNATIONAL BANK, ROGELIO account deposits are accepted by the bank on the basis of deposit
LACSON, DIGNA DE LEON, MARIA ANGELITA PASCUAL, et al., slips prepared and signed by the depositor, or the latter's agent or
petitioners, representative, who indicates therein the current account number
vs. to which the deposit is to be credited, the name of the depositor or
THE COURT OF APPEALS, ROMMEL'S MARKETING CORP., current account holder, the date of the deposit, and the amount of
represented by ROMEO LIPANA, its President & General the deposit either in cash or checks. The deposit slip has an upper
Manager, respondents. portion or stub, which is detached and given to the depositor or his
agent; the lower portion is retained by the bank. In some instances,
HERMOSISIMA, JR., J.: however, the deposit slips are prepared in duplicate by the
Challenged in this petition for review is the Decision dated depositor. The original of the deposit slip is retained by the bank,
February 28, 1991 1 rendered by public respondent Court of while the duplicate copy is returned or given to the depositor.
Appeals which affirmed the Decision dated November 15, 1985 of From May 5, 1975 to July 16, 1976, petitioner Romeo Lipana
the Regional Trial Court, National Capital Judicial Region, Branch claims to have entrusted RMC funds in the form of cash totalling
CLX (160), Pasig City, in Civil Case No. 27288 entitled "Rommel's P304,979.74 to his secretary, Irene Yabut, for the purpose of
Marketing Corporation, etc. v. Philippine Bank of Commerce, now depositing said funds in the current accounts of RMC with PBC. It
absorbed by Philippine Commercial and Industrial Bank." turned out, however, that these deposits, on all occasions, were not
The case stemmed from a complaint filed by the private respondent credited to RMC's account but were instead deposited to Account
Rommel's Marketing Corporation (RMC for brevity), represented by No. 53-01734-7 of Yabut's husband, Bienvenido Cotas who
its President and General Manager Romeo Lipana, to recover from likewise maintains an account with the same bank. During this
the former Philippine Bank of Commerce (PBC for brevity), now period, petitioner bank had, however, been regularly furnishing
absorbed by the Philippine Commercial International Bank, the private respondent with monthly statements showing its current
sum of P304,979.74 representing various deposits it had made in accounts balances. Unfortunately, it had never been the practice of
its current account with said bank but which were not credited to

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Romeo Lipana to check these monthly statements of account WHEREFORE, judgment is hereby rendered
reposing complete trust and confidence on petitioner bank. sentencing defendant Philippine Bank of Commerce,
Irene Yabut's modus operandi is far from complicated. She would now absorbed by defendant Philippine Commercial
accomplish two (2) copies of the deposit slip, an original and a & Industrial Bank, and defendant Azucena Mabayad
duplicate. The original showed the name of her husband as to pay the plaintiff, jointly and severally, and
depositor and his current account number. On the duplicate copy without prejudice to any criminal action which may
was written the account number of her husband but the name of be instituted if found warranted:
the account holder was left blank. PBC's teller, Azucena Mabayad, 1. The sum of P304,979.72, representing plaintiffs
would, however, validate and stamp both the original and the lost deposit, plus interest thereon at the legal rate
duplicate of these deposit slips retaining only the original copy from the filing of the complaint;
despite the lack of information on the duplicate slip. The second 2. A sum equivalent to 14% thereof, as exemplary
copy was kept by Irene Yabut allegedly for record purposes. After damages;
validation, Yabut would then fill up the name of RMC in the space 3. A sum equivalent to 25% of the total amount due,
left blank in the duplicate copy and change the account number as and for attorney's fees; and
written thereon, which is that of her husband's, and make it 4. Costs.
appear to be RMC's account number, i.e., C.A. No. 53-01980-3. Defendants' counterclaim is hereby dismissed for
With the daily remittance records also prepared by Ms. Yabut and lack of merit. 2
submitted to private respondent RMC together with the validated On appeal, the appellate court affirmed the foregoing decision with
duplicate slips with the latter's name and account number, she modifications, viz:
made her company believe that all the while the amounts she WHEREFORE, the decision appealed from herein is
deposited were being credited to its account when, in truth and in MODIFIED in the sense that the awards of
fact, they were being deposited by her and credited by the exemplary damages and attorney's fees specified
petitioner bank in the account of Cotas. This went on in a span of therein are eliminated and instead, appellants are
more than one (1) year without private respondent's knowledge. ordered to pay plaintiff, in addition to the principal
Upon discovery of the loss of its funds, RMC demanded from sum of P304,979.74 representing plaintiff's lost
petitioner bank the return of its money, but as its demand went deposit plus legal interest thereon from the filing of
unheeded, it filed a collection suit before the Regional Trial Court the complaint, P25,000.00 attorney's fees and costs
of Pasig, Branch 160. The trial court found petitioner bank in the lower court as well as in this Court. 3
negligent and ruled as follows: Hence, this petition anchored on the following grounds:

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1) The proximate cause of the loss is the negligence money deposited by Ms. Irene Yabut belong to RMC; neither was
of respondent Rommel Marketing Corporation and the bank forewarned by RMC that Yabut will be depositing cash to
Romeo Lipana in entrusting cash to a dishonest its account. Thus, it was impossible for the bank to know the
employee. fraudulent design of Yabut considering that her husband,
2) The failure of respondent Rommel Marketing Bienvenido Cotas, also maintained an account with the bank. For
Corporation to cross-check the bank's statements of the bank to inquire into the ownership of the cash deposited by
account with its own records during the entire Ms. Irene Yabut would be irregular. Otherwise stated, it was RMC's
period of more than one (1) year is the proximate negligence in entrusting cash to a dishonest employee which
cause of the commission of subsequent frauds and provided Ms. Irene Yabut the opportunity to defraud RMC. 6
misappropriation committed by Ms. Irene Yabut. Private respondent, on the other hand, maintains that the
3) The duplicate copies of the deposit slips presented proximate cause of the loss was the negligent act of the bank, thru
by respondent Rommel Marketing Corporation are its teller Ms. Azucena Mabayad, in validating the deposit slips,
falsified and are not proof that the amounts both original and duplicate, presented by Ms. Yabut to Ms.
appearing thereon were deposited to respondent Mabayad, notwithstanding the fact that one of the deposit slips
Rommel Marketing Corporation's account with the was not completely accomplished.
bank, We sustain the private respondent.
4) The duplicate copies of the deposit slips were Our law on quasi-delicts states:
used by Ms. Irene Yabut to cover up her fraudulent Art. 2176. Whoever by act or omission causes
acts against respondent Rommel Marketing damage to another, there being fault or negligence,
Corporation, and not as records of deposits she is obliged to pay for the damage done. Such fault or
made with the bank. 4 negligence, if there is no pre-existing contractual
The petition has no merit. relation between the parties, is called a quasi-delict
Simply put, the main issue posited before us is: What is the and is governed by the provisions of this Chapter.
proximate cause of the loss, to the tune of P304,979.74, suffered There are three elements of a quasi-delict: (a) damages suffered by
by the private respondent RMC petitioner bank's negligence or the plaintiff; (b) fault or negligence of the defendant, or some other
that of private respondent's? person for whose acts he must respond; and (c) the connection of
Petitioners submit that the proximate cause of the loss is the cause and effect between the fault or negligence of the defendant
negligence of respondent RMC and Romeo Lipana in entrusting and the damages incurred by the plaintiff. 7
cash to a dishonest employee in the person of Ms. Irene Yabut. 5 In the case at bench, there is no dispute as to the damage suffered
According to them, it was impossible for the bank to know that the by the private respondent (plaintiff in the trial court) RMC in the

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amount of P304,979.74. It is in ascribing fault or negligence which Mabayad your important duties and
caused the damage where the parties point to each other as the functions?
culprit. A: I accept current and savings
Negligence is the omission to do something which a reasonable deposits from depositors and
man, guided by those considerations which ordinarily regulate the encashments.
conduct of human affairs, would do, or the doing of something Q: Now in the handling of current
which a prudent and reasonable man would do. The seventy-eight account deposits of bank clients,
(78)-year-old, yet still relevant, case of Picart v. Smith, 8 provides could you tell us the procedure you
the test by which to determine the existence of negligence in a follow?
particular case which may be stated as follows: Did the defendant A: The client or depositor or the
in doing the alleged negligent act use that reasonable care and authorized representative prepares a
caution which an ordinarily prudent person would have used in deposit slip by filling up the deposit
the same situation? If not, then he is guilty of negligence. The law slip with the name, the account
here in effect adopts the standard supposed to be supplied by the number, the date, the cash
imaginary conduct of the discreet paterfamilias of the Roman law. breakdown, if it is deposited for cash,
The existence of negligence in a given case is not determined by and the check number, the amount
reference to the personal judgment of the actor in the situation and then he signs the deposit slip.
before him. The law considers what would be reckless, Q: Now, how many deposit slips do
blameworthy, or negligent in the man of ordinary intelligence and you normally require in
prudence and determines liability by that. accomplishing current account
Applying the above test, it appears that the bank's teller, Ms. deposit, Mrs. Mabayad?
Azucena Mabayad, was negligent in validating, officially stamping A: The bank requires only one copy of
and signing all the deposit slips prepared and presented by Ms. the deposit although some of our
Yabut, despite the glaring fact that the duplicate copy was not clients prepare the deposit slip in
completely accomplished contrary to the self-imposed procedure of duplicate.
the bank with respect to the proper validation of deposit slips, Q: Now in accomplishing current
original or duplicate, as testified to by Ms. Mabayad herself, thus: account deposits from your clients,
Q: Now, as teller of PCIB, Pasig what do you issue to the depositor to
Branch, will you please tell us Mrs. evidence the deposit made?

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A: We issue or we give to the clients compulsorily required by the bank in accepting deposits
the depositor's stub as a receipt of the should not relieve the petitioner bank of responsibility. The
deposit. odd circumstance alone that such duplicate copy lacked
Q: And who prepares the deposit slip? one vital information that of the name of the account
A: The depositor or the authorized holder should have already put Ms. Mabayad on guard.
representative sir? Rather than readily validating the incomplete duplicate
Q: Where does the depositor's stub copy, she should have proceeded more cautiously by being
comes (sic) from Mrs. Mabayad, is it more probing as to the true reason why the name of the
with the deposit slip? account holder in the duplicate slip was left blank while
A: The depositor's stub is connected that in the original was filled up. She should not have been
with the deposit slip or the bank's so naive in accepting hook, line and sinker the too shallow
copy. In a deposit slip, the upper excuse of Ms. Irene Yabut to the effect that since the
portion is the depositor's stub and duplicate copy was only for her personal record, she would
the lower portion is the bank's copy, simply fill up the blank space later on. 11 A "reasonable
and you can detach the bank's copy man of ordinary prudence" 12 would not have given
from the depositor's stub by tearing it credence to such explanation and would have insisted that
sir. the space left blank be filled up as a condition for
Q: Now what do you do upon validation. Unfortunately, this was not how bank teller
presentment of the deposit slip by the Mabayad proceeded thus resulting in huge losses to the
depositor or the depositor's private respondent.
authorized representative? Negligence here lies not only on the part of Ms. Mabayad but also
A: We see to it that the deposit slip 9 is on the part of the bank itself in its lackadaisical selection and
properly accomplished and then we supervision of Ms. Mabayad. This was exemplified in the testimony
count the money and then we tally it of Mr. Romeo Bonifacio, then Manager of the Pasig Branch of the
with the deposit slip sir. petitioner bank and now its Vice-President, to the effect that, while
Q: Now is the depositor's stub which he ordered the investigation of the incident, he never came to know
you issued to your clients validated? that blank deposit slips were validated in total disregard of the
A: Yes, sir. 10 [Emphasis ours] bank's validation procedures, viz:
Clearly, Ms. Mabayad failed to observe this very important Q: Did he ever tell you that one of
procedure. The fact that the duplicate slip was not your cashiers affixed the stamp mark

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of the bank on the deposit slips and It was this negligence of Ms. Azucena Mabayad, coupled by the
they validated the same with the negligence of the petitioner bank in the selection and supervision of
machine, the fact that those deposit its bank teller, which was the proximate cause of the loss suffered
slips were unfilled up, is there any by the private respondent, and not the latter's act of entrusting
report similar to that? cash to a dishonest employee, as insisted by the petitioners.
A: No, it was not the cashier but the Proximate cause is determined on the facts of each case upon
teller. mixed considerations of logic, common sense, policy and
Q: The teller validated the blank precedent. 15 Vda. de Bataclan v. Medina, 16 reiterated in the case
deposit slip? of Bank of the Phil. Islands v. Court of Appeals, 17 defines proximate
A: No it was not reported. cause as "that cause, which, in natural and continuous sequence,
Q: You did not know that any one in unbroken by any efficient intervening cause, produces the injury,
the bank tellers or cashiers validated and without which the result would not have occurred. . . ." In this
the blank deposit slip? case, absent the act of Ms. Mabayad in negligently validating the
A: I am not aware of that. incomplete duplicate copy of the deposit slip, Ms. Irene Yabut
Q: It is only now that you are aware of would not have the facility with which to perpetrate her fraudulent
that? scheme with impunity. Apropos, once again, is the pronouncement
A: Yes, sir. 13 made by the respondent appellate court, to wit:
Prescinding from the above, public respondent Court of Appeals . . . . Even if Yabut had the fraudulent intention to
aptly observed: misappropriate the funds entrusted to her by
xxx xxx xxx plaintiff, she would not have been able to deposit
It was in fact only when he testified in this case in those funds in her husband's current account, and
February, 1983, or after the lapse of more than then make plaintiff believe that it was in the latter's
seven (7) years counted from the period when the accounts wherein she had deposited them, had it
funds in question were deposited in plaintiff's not been for bank teller Mabayad's aforesaid gross
accounts (May, 1975 to July, 1976) that bank and reckless negligence. The latter's negligence was
manager Bonifacio admittedly became aware of the thus the proximate, immediate and efficient cause
practice of his teller Mabayad of validating blank that brought about the loss claimed by plaintiff in
deposit slips. Undoubtedly, this is gross, wanton, this case, and the failure of plaintiff to discover the
and inexcusable negligence in the appellant bank's same soon enough by failing to scrutinize the
supervision of its employees. 14 monthly statements of account being sent to it by

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appellant bank could not have prevented the fraud Art. 1173. The fault or negligence of the obligor
and misappropriation which Irene Yabut had consists in the omission of that diligence which is
already completed when she deposited plaintiff's required by the nature of the obligation and
money to the account of her husband instead of to corresponds with the circumstances of the persons,
the latter's accounts. 18 of the time and of the place. When negligence shows
Furthermore, under the doctrine of "last clear chance" (also bad faith, the provisions of articles 1171 and 2201,
referred to, at times as "supervening negligence" or as "discovered paragraph 2, shall apply.
peril"), petitioner bank was indeed the culpable party. This If the law or contract does not state the diligence
doctrine, in essence, states that where both parties are negligent, which is to be observed in the performance, that
but the negligent act of one is appreciably later in time than that of which is expected of a good father of a family shall
the other, or when it is impossible to determine whose fault or be required. (1104a)
negligence should be attributed to the incident, the one who had In the case of banks, however, the degree of diligence required is
the last clear opportunity to avoid the impending harm and failed more than that of a good father of a family. Considering the
to do so is chargeable with the consequences thereof. 19 Stated fiduciary nature of their relationship with their depositors, banks
differently, the rule would also mean that an antecedent negligence are duty bound to treat the accounts of their clients with the
of a person does not preclude the recovery of damages for the highest degree of care. 21
supervening negligence of, or bar a defense against liability sought As elucidated in Simex International (Manila), Inc. v. Court of
by another, if the latter, who had the last fair chance, could have Appeals, 22 in every case, the depositor expects the bank to treat
avoided the impending harm by the exercise of due diligence. 20 his account with the utmost fidelity, whether such account
Here, assuming that private respondent RMC was negligent in consists only of a few hundred pesos or of millions. The bank must
entrusting cash to a dishonest employee, thus providing the latter record every single transaction accurately, down to the last
with the opportunity to defraud the company, as advanced by the centavo, and as promptly as possible. This has to be done if the
petitioner, yet it cannot be denied that the petitioner bank, thru its account is to reflect at any given time the amount of money the
teller, had the last clear opportunity to avert the injury incurred by depositor can dispose as he sees fit, confident that the bank will
its client, simply by faithfully observing their self-imposed deliver it as and to whomever he directs. A blunder on the part of
validation procedure. the bank, such as the failure to duly credit him his deposits as
At this juncture, it is worth to discuss the degree of diligence ought soon as they are made, can cause the depositor not a little
to be exercised by banks in dealing with their clients. embarrassment if not financial loss and perhaps even civil and
The New Civil Code provides: criminal litigation.

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The point is that as a business affected with public interest and monthly statements of account. Had it done so, the company
because of the nature of its functions, the bank is under obligation would have been alerted to the series of frauds being committed
to treat the accounts of its depositors with meticulous care, always against RMC by its secretary. The damage would definitely not
having in mind the fiduciary nature of their relationship. In the have ballooned to such an amount if only RMC, particularly Romeo
case before us, it is apparent that the petitioner bank was remiss Lipana, had exercised even a little vigilance in their financial
in that duty and violated that relationship. affairs. This omission by RMC amounts to contributory negligence
Petitioners nevertheless aver that the failure of respondent RMC to which shall mitigate the damages that may be awarded to the
cross-check the bank's statements of account with its own records private respondent 23 under Article 2179 of the New Civil Code, to
during the entire period of more than one (1) year is the proximate wit:
cause of the commission of subsequent frauds and . . . When the plaintiff's own negligence was the
misappropriation committed by Ms. Irene Yabut. immediate and proximate cause of his injury, he
We do not agree. cannot recover damages. But if his negligence was
While it is true that had private respondent checked the monthly only contributory, the immediate and proximate
statements of account sent by the petitioner bank to RMC, the cause of the injury being the defendant's lack of due
latter would have discovered the loss early on, such cannot be used care, the plaintiff may recover damages, but the
by the petitioners to escape liability. This omission on the part of courts shall mitigate the damages to be awarded.
the private respondent does not change the fact that were it not for In view of this, we believe that the demands of substantial
the wanton and reckless negligence of the petitioners' employee in justice are satisfied by allocating the damage on a 60-40
validating the incomplete duplicate deposit slips presented by Ms. ratio. Thus, 40% of the damage awarded by the respondent
Irene Yabut, the loss would not have occurred. Considering, appellate court, except the award of P25,000.00 attorney's
however, that the fraud was committed in a span of more than one fees, shall be borne by private respondent RMC; only the
(1) year covering various deposits, common human experience balance of 60% needs to be paid by the petitioners. The
dictates that the same would not have been possible without any award of attorney's fees shall be borne exclusively by the
form of collusion between Ms. Yabut and bank teller Mabayad. Ms. petitioners.
Mabayad was negligent in the performance of her duties as bank WHEREFORE, the decision of the respondent Court of Appeals is
teller nonetheless. Thus, the petitioners are entitled to claim modified by reducing the amount of actual damages private
reimbursement from her for whatever they shall be ordered to pay respondent is entitled to by 40%. Petitioners may recover from Ms.
in this case. Azucena Mabayad the amount they would pay the private
The foregoing notwithstanding, it cannot be denied that, indeed, respondent. Private respondent shall have recourse against Ms.
private respondent was likewise negligent in not checking its

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Irene Yabut. In all other respects, the appellate court's decision is
AFFIRMED.
Proportionate costs.
SO ORDERED.

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FIRST DIVISION Company, CPAs (L.C. Diaz), is a professional partnership engaged
[G.R. No. 138569. September 11, 2003] in the practice of accounting.
THE CONSOLIDATED BANK and TRUST CORPORATION, Sometime in March 1976, L.C. Diaz opened a savings account with
petitioner, vs. COURT OF APPEALS and L.C. DIAZ and COMPANY, Solidbank, designated as Savings Account No. S/A 200-16872-6.
CPAs, respondents. On 14 August 1991, L.C. Diaz through its cashier, Mercedes
DECISION Macaraya (Macaraya), filled up a savings (cash) deposit slip for
CARPIO, J.: P990 and a savings (checks) deposit slip for P50. Macaraya
The Case instructed the messenger of L.C. Diaz, Ismael Calapre (Calapre), to
Before us is a petition for review of the Decision1[1] of the Court of deposit the money with Solidbank. Macaraya also gave Calapre the
Appeals dated 27 October 1998 and its Resolution dated 11 May Solidbank passbook.
1999. The assailed decision reversed the Decision2[2] of the Calapre went to Solidbank and presented to Teller No. 6 the two
Regional Trial Court of Manila, Branch 8, absolving petitioner deposit slips and the passbook. The teller acknowledged receipt of
Consolidated Bank and Trust Corporation, now known as the deposit by returning to Calapre the duplicate copies of the two
Solidbank Corporation (Solidbank), of any liability. The questioned deposit slips. Teller No. 6 stamped the deposit slips with the words
resolution of the appellate court denied the motion for DUPLICATE and SAVING TELLER 6 SOLIDBANK HEAD OFFICE.
reconsideration of Solidbank but modified the decision by deleting Since the transaction took time and Calapre had to make another
the award of exemplary damages, attorneys fees, expenses of deposit for L.C. Diaz with Allied Bank, he left the passbook with
litigation and cost of suit. Solidbank. Calapre then went to Allied Bank. When Calapre
The Facts returned to Solidbank to retrieve the passbook, Teller No. 6
Solidbank is a domestic banking corporation organized and informed him that somebody got the passbook.3[3] Calapre went
existing under Philippine laws. Private respondent L.C. Diaz and back to L.C. Diaz and reported the incident to Macaraya.
Macaraya immediately prepared a deposit slip in duplicate copies
with a check of P200,000. Macaraya, together with Calapre, went
to Solidbank and presented to Teller No. 6 the deposit slip and
check. The teller stamped the words DUPLICATE and SAVING
TELLER 6 SOLIDBANK HEAD OFFICE on the duplicate copy of the

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deposit slip. When Macaraya asked for the passbook, Teller No. 6 withdrawal slip for the P300,000 bore the signatures of the
told Macaraya that someone got the passbook but she could not authorized signatories of L.C. Diaz, namely Diaz and Rustico L.
remember to whom she gave the passbook. When Macaraya asked Murillo. The signatories, however, denied signing the withdrawal
Teller No. 6 if Calapre got the passbook, Teller No. 6 answered that slip. A certain Noel Tamayo received the P300,000.
someone shorter than Calapre got the passbook. Calapre was then In an Information6[6] dated 5 September 1991, L.C. Diaz charged
standing beside Macaraya. its messenger, Emerano Ilagan (Ilagan) and one Roscon Verdazola
Teller No. 6 handed to Macaraya a deposit slip dated 14 August with Estafa through Falsification of Commercial Document. The
1991 for the deposit of a check for P90,000 drawn on Philippine Regional Trial Court of Manila dismissed the criminal case after the
Banking Corporation (PBC). This PBC check of L.C. Diaz was a City Prosecutor filed a Motion to Dismiss on 4 August 1992.
check that it had long closed.4[4] PBC subsequently dishonored On 24 August 1992, L.C. Diaz through its counsel demanded from
the check because of insufficient funds and because the signature Solidbank the return of its money. Solidbank refused.
in the check differed from PBCs specimen signature. Failing to get On 25 August 1992, L.C. Diaz filed a Complaint7[7] for Recovery of
back the passbook, Macaraya went back to her office and reported a Sum of Money against Solidbank with the Regional Trial Court of
the matter to the Personnel Manager of L.C. Diaz, Emmanuel Manila, Branch 8. After trial, the trial court rendered on 28
Alvarez. December 1994 a decision absolving Solidbank and dismissing the
The following day, 15 August 1991, L.C. Diaz through its Chief complaint.
Executive Officer, Luis C. Diaz (Diaz), called up Solidbank to stop L.C. Diaz then appealed8[8] to the Court of Appeals. On 27 October
any transaction using the same passbook until L.C. Diaz could 1998, the Court of Appeals issued its Decision reversing the
open a new account.5[5] On the same day, Diaz formally wrote decision of the trial court.
Solidbank to make the same request. It was also on the same day
that L.C. Diaz learned of the unauthorized withdrawal the day
before, 14 August 1991, of P300,000 from its savings account. The

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On 11 May 1999, the Court of Appeals issued its Resolution forged. The trial court admonished L.C. Diaz for not offering in
denying the motion for reconsideration of Solidbank. The appellate evidence the National Bureau of Investigation (NBI) report on the
court, however, modified its decision by deleting the award of authenticity of the signatures on the withdrawal slip for P300,000.
exemplary damages and attorneys fees. The trial court believed that L.C. Diaz did not offer this evidence
The Ruling of the Trial Court because it is derogatory to its action.
In absolving Solidbank, the trial court applied the rules on savings Another provision of the rules on savings account states that the
account written on the passbook. The rules state that possession of depositor must keep the passbook under lock and key.10[10] When
this book shall raise the presumption of ownership and any another person presents the passbook for withdrawal prior to
payment or payments made by the bank upon the production of Solidbanks receipt of the notice of loss of the passbook, that
the said book and entry therein of the withdrawal shall have the person is considered as the owner of the passbook. The trial court
same effect as if made to the depositor personally.9[9] ruled that the passbook presented during the questioned
At the time of the withdrawal, a certain Noel Tamayo was not only transaction was now out of the lock and key and presumptively
in possession of the passbook, he also presented a withdrawal slip ready for a business transaction.11[11]
with the signatures of the authorized signatories of L.C. Diaz. The Solidbank did not have any participation in the custody and care of
specimen signatures of these persons were in the signature cards. the passbook. The trial court believed that Solidbanks act of
The teller stamped the withdrawal slip with the words Saving Teller allowing the withdrawal of P300,000 was not the direct and
No. 5. The teller then passed on the withdrawal slip to Genere proximate cause of the loss. The trial court held that L.C. Diazs
Manuel (Manuel) for authentication. Manuel verified the signatures negligence caused the unauthorized withdrawal. Three facts
on the withdrawal slip. The withdrawal slip was then given to establish L.C. Diazs negligence: (1) the possession of the passbook
another officer who compared the signatures on the withdrawal by a person other than the depositor L.C. Diaz; (2) the presentation
slip with the specimen on the signature cards. The trial court of a signed withdrawal receipt by an unauthorized person; and (3)
concluded that Solidbank acted with care and observed the rules the possession by an unauthorized person of a PBC check long
on savings account when it allowed the withdrawal of P300,000
from the savings account of L.C. Diaz.
The trial court pointed out that the burden of proof now shifted to
L.C. Diaz to prove that the signatures on the withdrawal slip were

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closed by L.C. Diaz, which check was deposited on the day of the The Ruling of the Court of Appeals
fraudulent withdrawal. The Court of Appeals ruled that Solidbanks negligence was the
The trial court debunked L.C. Diazs contention that Solidbank did proximate cause of the unauthorized withdrawal of P300,000 from
not follow the precautionary procedures observed by the two the savings account of L.C. Diaz. The appellate court reached this
parties whenever L.C. Diaz withdrew significant amounts from its conclusion after applying the provision of the Civil Code on quasi-
account. L.C. Diaz claimed that a letter must accompany delict, to wit:
withdrawals of more than P20,000. The letter must request Article 2176. Whoever by act or omission causes damage to
Solidbank to allow the withdrawal and convert the amount to a another, there being fault or negligence, is obliged to pay for the
managers check. The bearer must also have a letter authorizing damage done. Such fault or negligence, if there is no pre-existing
him to withdraw the same amount. Another person driving a car contractual relation between the parties, is called a quasi-delict
must accompany the bearer so that he would not walk from and is governed by the provisions of this chapter.
Solidbank to the office in making the withdrawal. The trial court The appellate court held that the three elements of a quasi-delict
pointed out that L.C. Diaz disregarded these precautions in its past are present in this case, namely: (a) damages suffered by the
withdrawal. On 16 July 1991, L.C. Diaz withdrew P82,554 without plaintiff; (b) fault or negligence of the defendant, or some other
any separate letter of authorization or any communication with person for whose acts he must respond; and (c) the connection of
Solidbank that the money be converted into a managers check. cause and effect between the fault or negligence of the defendant
The trial court further justified the dismissal of the complaint by and the damage incurred by the plaintiff.
holding that the case was a last ditch effort of L.C. Diaz to recover The Court of Appeals pointed out that the teller of Solidbank who
P300,000 after the dismissal of the criminal case against Ilagan. received the withdrawal slip for P300,000 allowed the withdrawal
The dispositive portion of the decision of the trial court reads: without making the necessary inquiry. The appellate court stated
IN VIEW OF THE FOREGOING, judgment is hereby rendered that the teller, who was not presented by Solidbank during trial,
DISMISSING the complaint. should have called up the depositor because the money to be
The Court further renders judgment in favor of defendant bank withdrawn was a significant amount. Had the teller called up L.C.
pursuant to its counterclaim the amount of Thirty Thousand Pesos Diaz, Solidbank would have known that the withdrawal was
(P30,000.00) as attorneys fees. unauthorized. The teller did not even verify the identity of the
With costs against plaintiff. impostor who made the withdrawal. Thus, the appellate court
SO ORDERED.12[12] found Solidbank liable for its negligence in the selection and
supervision of its employees.

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The appellate court ruled that while L.C. Diaz was also negligent in SO ORDERED.13[13]
entrusting its deposits to its messenger and its messenger in Acting on the motion for reconsideration of Solidbank, the
leaving the passbook with the teller, Solidbank could not escape appellate court affirmed its decision but modified the award of
liability because of the doctrine of last clear chance. Solidbank damages. The appellate court deleted the award of exemplary
could have averted the injury suffered by L.C. Diaz had it called up damages and attorneys fees. Invoking Article 223114[14] of the
L.C. Diaz to verify the withdrawal. Civil Code, the appellate court ruled that exemplary damages could
The appellate court ruled that the degree of diligence required from be granted if the defendant acted with gross negligence. Since
Solidbank is more than that of a good father of a family. The Solidbank was guilty of simple negligence only, the award of
business and functions of banks are affected with public interest. exemplary damages was not justified. Consequently, the award of
Banks are obligated to treat the accounts of their depositors with attorneys fees was also disallowed pursuant to Article 2208 of the
meticulous care, always having in mind the fiduciary nature of Civil Code. The expenses of litigation and cost of suit were also not
their relationship with their clients. The Court of Appeals found imposed on Solidbank.
Solidbank remiss in its duty, violating its fiduciary relationship The dispositive portion of the Resolution reads as follows:
with L.C. Diaz. WHEREFORE, foregoing considered, our decision dated October
The dispositive portion of the decision of the Court of Appeals 27, 1998 is affirmed with modification by deleting the award of
reads: exemplary damages and attorneys fees, expenses of litigation and
WHEREFORE, premises considered, the decision appealed from is cost of suit.
hereby REVERSED and a new one entered. SO ORDERED.15[15]
1. Ordering defendant-appellee Consolidated Bank and
Trust Corporation to pay plaintiff-appellant the sum
of Three Hundred Thousand Pesos (P300,000.00),
with interest thereon at the rate of 12% per annum
from the date of filing of the complaint until paid,
the sum of P20,000.00 as exemplary damages, and
P20,000.00 as attorneys fees and expenses of
litigation as well as the cost of suit; and
2. Ordering the dismissal of defendant-appellees
counterclaim in the amount of P30,000.00 as
attorneys fees.

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Hence, this petition. ILAGAN, AND IN THE SAFEKEEPING OF ITS
The Issues CHECKS AND OTHER FINANCIAL DOCUMENTS.
Solidbank seeks the review of the decision and resolution of the III. THE COURT OF APPEALS ERRED IN NOT FINDING
Court of Appeals on these grounds: THAT THE INSTANT CASE IS A LAST DITCH
I. THE COURT OF APPEALS ERRED IN HOLDING EFFORT OF PRIVATE RESPONDENT TO RECOVER
THAT PETITIONER BANK SHOULD SUFFER THE ITS P300,000.00 AFTER FAILING IN ITS EFFORTS
LOSS BECAUSE ITS TELLER SHOULD HAVE FIRST TO RECOVER THE SAME FROM ITS EMPLOYEE
CALLED PRIVATE RESPONDENT BY TELEPHONE EMERANO ILAGAN.
BEFORE IT ALLOWED THE WITHDRAWAL OF IV. THE COURT OF APPEALS ERRED IN NOT
P300,000.00 TO RESPONDENTS MESSENGER MITIGATING THE DAMAGES AWARDED AGAINST
EMERANO ILAGAN, SINCE THERE IS NO PETITIONER UNDER ARTICLE 2197 OF THE CIVIL
AGREEMENT BETWEEN THE PARTIES IN THE CODE, NOTWITHSTANDING ITS FINDING THAT
OPERATION OF THE SAVINGS ACCOUNT, NOR IS PETITIONER BANKS NEGLIGENCE WAS ONLY
THERE ANY BANKING LAW, WHICH MANDATES CONTRIBUTORY.16[16]
THAT A BANK TELLER SHOULD FIRST CALL UP The Ruling of the Court
THE DEPOSITOR BEFORE ALLOWING A The petition is partly meritorious.
WITHDRAWAL OF A BIG AMOUNT IN A SAVINGS Solidbanks Fiduciary Duty under the Law
ACCOUNT. The rulings of the trial court and the Court of Appeals conflict on
II. THE COURT OF APPEALS ERRED IN APPLYING the application of the law. The trial court pinned the liability on
THE DOCTRINE OF LAST CLEAR CHANCE AND IN L.C. Diaz based on the provisions of the rules on savings account,
HOLDING THAT PETITIONER BANKS TELLER HAD a recognition of the contractual relationship between Solidbank
THE LAST OPPORTUNITY TO WITHHOLD THE and L.C. Diaz, the latter being a depositor of the former. On the
WITHDRAWAL WHEN IT IS UNDISPUTED THAT other hand, the Court of Appeals applied the law on quasi-delict to
THE TWO SIGNATURES OF RESPONDENT ON THE determine who between the two parties was ultimately negligent.
WITHDRAWAL SLIP ARE GENUINE AND PRIVATE The law on quasi-delict or culpa aquiliana is generally applicable
RESPONDENTS PASSBOOK WAS DULY
PRESENTED, AND CONTRARIWISE RESPONDENT
WAS NEGLIGENT IN THE SELECTION AND
SUPERVISION OF ITS MESSENGER EMERANO

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when there is no pre-existing contractual relationship between the in the general banking law, introduced in 2000, is a statutory
parties. affirmation of Supreme Court decisions, starting with the 1990
We hold that Solidbank is liable for breach of contract due to case of Simex International v. Court of Appeals,20[20] holding
negligence, or culpa contractual. that the bank is under obligation to treat the accounts of its
The contract between the bank and its depositor is governed by the depositors with meticulous care, always having in mind the
provisions of the Civil Code on simple loan.17[17] Article 1980 of fiduciary nature of their relationship.21[21]
the Civil Code expressly provides that x x x savings x x x deposits This fiduciary relationship means that the banks obligation to
of money in banks and similar institutions shall be governed by the observe high standards of integrity and performance is deemed
provisions concerning simple loan. There is a debtor-creditor written into every deposit agreement between a bank and its
relationship between the bank and its depositor. The bank is the depositor. The fiduciary nature of banking requires banks to
debtor and the depositor is the creditor. The depositor lends the assume a degree of diligence higher than that of a good father of a
bank money and the bank agrees to pay the depositor on demand. family. Article 1172 of the Civil Code states that the degree of
The savings deposit agreement between the bank and the depositor diligence required of an obligor is that prescribed by law or
is the contract that determines the rights and obligations of the contract, and absent such stipulation then the diligence of a good
parties. father of a family.22[22] Section 2 of RA 8791 prescribes the
The law imposes on banks high standards in view of the fiduciary statutory diligence required from banks that banks must observe
nature of banking. Section 2 of Republic Act No. 8791 (RA
8791),18[18] which took effect on 13 June 2000, declares that the
State recognizes the fiduciary nature of banking that requires high
standards of integrity and performance.19[19] This new provision

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high standards of integrity and performance in servicing their are cestui que trust of banks, then the interest spread or income
depositors. Although RA 8791 took effect almost nine years after belongs to the depositors, a situation that Congress certainly did
the unauthorized withdrawal of the P300,000 from L.C. Diazs not intend in enacting Section 2 of RA 8791.
savings account, jurisprudence23[23] at the time of the withdrawal Solidbanks Breach of its Contractual Obligation
already imposed on banks the same high standard of diligence Article 1172 of the Civil Code provides that responsibility arising
required under RA No. 8791. from negligence in the performance of every kind of obligation is
However, the fiduciary nature of a bank-depositor relationship does demandable. For breach of the savings deposit agreement due to
not convert the contract between the bank and its depositors from negligence, or culpa contractual, the bank is liable to its depositor.
a simple loan to a trust agreement, whether express or implied. Calapre left the passbook with Solidbank because the transaction
Failure by the bank to pay the depositor is failure to pay a simple took time and he had to go to Allied Bank for another transaction.
loan, and not a breach of trust.24[24] The law simply imposes on The passbook was still in the hands of the employees of Solidbank
the bank a higher standard of integrity and performance in for the processing of the deposit when Calapre left Solidbank.
complying with its obligations under the contract of simple loan, Solidbanks rules on savings account require that the deposit book
beyond those required of non-bank debtors under a similar should be carefully guarded by the depositor and kept under lock
contract of simple loan. and key, if possible. When the passbook is in the possession of
The fiduciary nature of banking does not convert a simple loan into Solidbanks tellers during withdrawals, the law imposes on
a trust agreement because banks do not accept deposits to enrich Solidbank and its tellers an even higher degree of diligence in
depositors but to earn money for themselves. The law allows banks safeguarding the passbook.
to offer the lowest possible interest rate to depositors while Likewise, Solidbanks tellers must exercise a high degree of
charging the highest possible interest rate on their own borrowers. diligence in insuring that they return the passbook only to the
The interest spread or differential belongs to the bank and not to depositor or his authorized representative. The tellers know, or
the depositors who are not cestui que trust of banks. If depositors should know, that the rules on savings account provide that any
person in possession of the passbook is presumptively its owner. If
the tellers give the passbook to the wrong person, they would be
clothing that person presumptive ownership of the passbook,
facilitating unauthorized withdrawals by that person. For failing to
return the passbook to Calapre, the authorized representative of
L.C. Diaz, Solidbank and Teller No. 6 presumptively failed to
observe such high degree of diligence in safeguarding the

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passbook, and in insuring its return to the party authorized to The bank must not only exercise high standards of integrity and
receive the same. performance, it must also insure that its employees do likewise
In culpa contractual, once the plaintiff proves a breach of contract, because this is the only way to insure that the bank will comply
there is a presumption that the defendant was at fault or negligent. with its fiduciary duty. Solidbank failed to present the teller who
The burden is on the defendant to prove that he was not at fault or had the duty to return to Calapre the passbook, and thus failed to
negligent. In contrast, in culpa aquiliana the plaintiff has the prove that this teller exercised the high standards of integrity and
burden of proving that the defendant was negligent. In the present performance required of Solidbanks employees.
case, L.C. Diaz has established that Solidbank breached its Proximate Cause of the Unauthorized Withdrawal
contractual obligation to return the passbook only to the Another point of disagreement between the trial and appellate
authorized representative of L.C. Diaz. There is thus a presumption courts is the proximate cause of the unauthorized withdrawal. The
that Solidbank was at fault and its teller was negligent in not trial court believed that L.C. Diazs negligence in not securing its
returning the passbook to Calapre. The burden was on Solidbank passbook under lock and key was the proximate cause that allowed
to prove that there was no negligence on its part or its employees. the impostor to withdraw the P300,000. For the appellate court,
Solidbank failed to discharge its burden. Solidbank did not present the proximate cause was the tellers negligence in processing the
to the trial court Teller No. 6, the teller with whom Calapre left the withdrawal without first verifying with L.C. Diaz. We do not agree
passbook and who was supposed to return the passbook to him. with either court.
The record does not indicate that Teller No. 6 verified the identity of Proximate cause is that cause which, in natural and continuous
the person who retrieved the passbook. Solidbank also failed to sequence, unbroken by any efficient intervening cause, produces
adduce in evidence its standard procedure in verifying the identity the injury and without which the result would not have
of the person retrieving the passbook, if there is such a procedure, occurred.26[26] Proximate cause is determined by the facts of each
and that Teller No. 6 implemented this procedure in the present case upon mixed considerations of logic, common sense, policy and
case. precedent.27[27]
Solidbank is bound by the negligence of its employees under the
principle of respondeat superior or command responsibility. The
defense of exercising the required diligence in the selection and
supervision of employees is not a complete defense in culpa
contractual, unlike in culpa aquiliana.25[25]

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L.C. Diaz was not at fault that the passbook landed in the hands of accounts. L.C. Diaz therefore had the burden to prove that it is the
the impostor. Solidbank was in possession of the passbook while it usual practice of Solidbank to call up its clients to verify a
was processing the deposit. After completion of the transaction, withdrawal of a large amount of money. L.C. Diaz failed to do so.
Solidbank had the contractual obligation to return the passbook Teller No. 5 who processed the withdrawal could not have been put
only to Calapre, the authorized representative of L.C. Diaz. on guard to verify the withdrawal. Prior to the withdrawal of
Solidbank failed to fulfill its contractual obligation because it gave P300,000, the impostor deposited with Teller No. 6 the P90,000
the passbook to another person. PBC check, which later bounced. The impostor apparently
Solidbanks failure to return the passbook to Calapre made possible deposited a large amount of money to deflect suspicion from the
the withdrawal of the P300,000 by the impostor who took withdrawal of a much bigger amount of money. The appellate court
possession of the passbook. Under Solidbanks rules on savings thus erred when it imposed on Solidbank the duty to call up L.C.
account, mere possession of the passbook raises the presumption Diaz to confirm the withdrawal when no law requires this from
of ownership. It was the negligent act of Solidbanks Teller No. 6 banks and when the teller had no reason to be suspicious of the
that gave the impostor presumptive ownership of the passbook. transaction.
Had the passbook not fallen into the hands of the impostor, the Solidbank continues to foist the defense that Ilagan made the
loss of P300,000 would not have happened. Thus, the proximate withdrawal. Solidbank claims that since Ilagan was also a
cause of the unauthorized withdrawal was Solidbanks negligence messenger of L.C. Diaz, he was familiar with its teller so that there
in not returning the passbook to Calapre. was no more need for the teller to verify the withdrawal. Solidbank
We do not subscribe to the appellate courts theory that the relies on the following statements in the Booking and Information
proximate cause of the unauthorized withdrawal was the tellers Sheet of Emerano Ilagan:
failure to call up L.C. Diaz to verify the withdrawal. Solidbank did xxx Ilagan also had with him (before the withdrawal) a forged check
not have the duty to call up L.C. Diaz to confirm the withdrawal. of PBC and indicated the amount of P90,000 which he deposited in
There is no arrangement between Solidbank and L.C. Diaz to this favor of L.C. Diaz and Company. After successfully withdrawing
effect. Even the agreement between Solidbank and L.C. Diaz this large sum of money, accused Ilagan gave alias Rey (Noel
pertaining to measures that the parties must observe whenever Tamayo) his share of the loot. Ilagan then hired a taxicab in the
withdrawals of large amounts are made does not direct Solidbank amount of P1,000 to transport him (Ilagan) to his home province at
to call up L.C. Diaz. Bauan, Batangas. Ilagan extravagantly and lavishly spent his
There is no law mandating banks to call up their clients whenever money but a big part of his loot was wasted in cockfight and horse
their representatives withdraw significant amounts from their

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racing. Ilagan was apprehended and meekly admitted his the loss.29[29] Stated differently, the antecedent negligence of the
guilt.28[28] (Emphasis supplied.) plaintiff does not preclude him from recovering damages caused by
L.C. Diaz refutes Solidbanks contention by pointing out that the the supervening negligence of the defendant, who had the last fair
person who withdrew the P300,000 was a certain Noel Tamayo. chance to prevent the impending harm by the exercise of due
Both the trial and appellate courts stated that this Noel Tamayo diligence.30[30]
presented the passbook with the withdrawal slip. We do not apply the doctrine of last clear chance to the present
We uphold the finding of the trial and appellate courts that a case. Solidbank is liable for breach of contract due to negligence in
certain Noel Tamayo withdrew the P300,000. The Court is not a the performance of its contractual obligation to L.C. Diaz. This is a
trier of facts. We find no justifiable reason to reverse the factual case of culpa contractual, where neither the contributory negligence
finding of the trial court and the Court of Appeals. The tellers who of the plaintiff nor his last clear chance to avoid the loss, would
processed the deposit of the P90,000 check and the withdrawal of exonerate the defendant from liability.31[31] Such contributory
the P300,000 were not presented during trial to substantiate negligence or last clear chance by the plaintiff merely serves to
Solidbanks claim that Ilagan deposited the check and made the reduce the recovery of damages by the plaintiff but does not
questioned withdrawal. Moreover, the entry quoted by Solidbank exculpate the defendant from his breach of contract.32[32]
does not categorically state that Ilagan presented the withdrawal
slip and the passbook.
Doctrine of Last Clear Chance
The doctrine of last clear chance states that where both parties are
negligent but the negligent act of one is appreciably later than that
of the other, or where it is impossible to determine whose fault or
negligence caused the loss, the one who had the last clear
opportunity to avoid the loss but failed to do so, is chargeable with

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Mitigated Damages
Under Article 1172, liability (for culpa contractual) may be regulated
by the courts, according to the circumstances. This means that if
the defendant exercised the proper diligence in the selection and
supervision of its employee, or if the plaintiff was guilty of
contributory negligence, then the courts may reduce the award of
damages. In this case, 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.
In Philippine Bank of Commerce v. Court of Appeals,33[33]
where the Court held the depositor guilty of contributory
negligence, we allocated the damages between the depositor and
the bank on a 40-60 ratio. Applying the same ruling to this case,
we hold that L.C. Diaz must shoulder 40% of the actual damages
awarded by the appellate court. Solidbank must pay the other 60%
of the actual damages.
WHEREFORE, the decision of the Court of Appeals is AFFIRMED
with MODIFICATION. Petitioner Solidbank Corporation shall pay
private respondent L.C. Diaz and Company, CPAs only 60% of the
actual damages awarded by the Court of Appeals. The remaining
40% of the actual damages shall be borne by private respondent
L.C. Diaz and Company, CPAs. Proportionate costs.
SO ORDERED.

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Republic of the Philippines The facts giving rise to the controversy at bar are recounted by the
SUPREME COURT trial court as follows:
Manila At about 6:30 in the morning of April 20, 1983, a collision
FIRST DIVISION occurred between a gravel and sand truck, with Plate No.
G.R. No. 89880 February 6, 1991 DAP 717, and a Mazda passenger bus with Motor No.
EMMA ADRIANO BUSTAMANTE, in her own behalf as Guardian- Y2231 and Plate No. DVT 259 along the national road at
Ad-Litem of minors: ROSSEL, GLORIA, YOLANDA, ERIC SON Calibuyo, Tanza, Cavite. The front left side portion
and EDERIC, all surnamed BUSTAMANTE, Spouses SALVADOR (barandilla) of the body of the truck sideswiped the left side
JOCSON and PATRIA BONE-JOCSON, Spouses JOSE RAMOS wall of the passenger bus, ripping off the said wall from the
and ENRIQUETA CEBU-RAMOS, Spouses NARCISO-HIMAYA and driver's seat to the last rear seat.
ADORACION MARQUEZ-HIMAYA, and Spouses JOSE Due to the impact, several passengers of the bus were
BERSAMINA and MA. COMMEMORACION PEREA- thrown out and died as a result of the injuries they
BUSTAMANTE, petitioners, sustained, Among those killed were the following:
vs. 1. Rogelio Bustamante, 40, husband of plaintiff Emma
THE HONORABLE COURT OF APPEALS, FEDERICO DEL PILAR Adriano Bustamante and father of plaintiffs Rossel, Gloria,
AND EDILBERTO MONTESIANO, respondents. Yolanda, Ericson, and Ederic, all surnamed Bustamante;
Dolorfino and Dominguez Law Offices for petitioners. 2. Maria Corazon Jocson, 16, daughter of plaintiffs spouses
J.C. Baldoz & Associates for private respondents. Salvador and Patria Jocson;
3. Jolet C. Ramos, 16, daughter of plaintiffs spouses Jose
MEDIALDEA, J.: and Enriqueta Ramos;
This is a petition for review on certiorari seeking the reversal of the 4. Enrico Himaya, 18, son of plaintiffs spouses Narciso and
decision of the respondent Court of Appeals dated February 15, Adoracion Himaya; and
1989 which reversed and set aside the decision of the Regional 5. Noel Bersamina, 17, son of plaintiffs spouses Jose and
Trial Court of Cavite, Branch XV ordering the defendants to pay Ma. Commemoracion Bersamina. (Rollo, p. 48)
jointly and severally the plaintiffs indemnity for death and During the incident, the cargo truck was driven by defendant
damages; and in further dismissing the complaint insofar as Montesiano and owned by defendant Del Pilar; while the passenger
defendants-appellants Federico del Pilar and Edilberto Montesiano bus was driven by defendant Susulin. The vehicle was registered in
are concerned; and its resolution dated August 17, 1989 denying the name of defendant Novelo but was owned and/or operated as a
the motion for reconsideration for lack of merit. passenger bus jointly by defendants Magtibay and Serrado, under
a franchise, with a line from Naic, Cavite, to Baclaran, Paranaque,

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Metro Manila, and vice versa, which Novelo sold to Magtibay on WHEREFORE, defendants Valeriano Magtibay, Simplicio
November 8, 1981, and which the latter transferred to Serrado Serrado, Ricardo Susulin, Efren Novelo, Federico del Pilar
(Cerrado) on January 18, 1983. and Edilberto Montesiano are hereby ordered to pay jointly
Immediately before the collision, the cargo truck and the passenger and severally to the plaintiffs, as follows:
bus were approaching each other, coming from the opposite 1. To plaintiffs Emma Adriano Bustamante and her minor
directions of the highway. While the truck was still about 30 children, the sum of P30,000.00 as indemnity for the death
meters away, Susulin, the bus driver, saw the front wheels of the of Rogelio Bustamante; U.S. $127,680.00 as indemnity for
vehicle wiggling. He also observed that the truck was heading the loss of the earning capacity of the said deceased, at its
towards his lane. Not minding this circumstance due to his belief prevailing rate in pesos at the time this decision shall have
that the driver of the truck was merely joking, Susulin shifted from become final and executory; P10,000.00 as moral damages;
fourth to third gear in order to give more power and speed to the and P5,000.00 as exemplary damages;
bus, which was ascending the inclined part of the road, in order to 2. To plaintiffs Salvador and Patria Jocson, the sum of
overtake or pass a Kubota hand tractor being pushed by a person P30,000.00 as indemnity for the death of their daughter,
along the shoulder of the highway. While the bus was in the Maria Corazon Jocson; P10,000.00 as moral damages; and
process of overtaking or passing the hand tractor and the truck P5,000.00 as exemplary damages;
was approaching the bus, the two vehicles sideswiped each other 3. To plaintiffs Jose and Enriqueta Ramos, the sum of
at each other's left side. After the impact, the truck skidded P30,000.00 as indemnity for the death of their daughter,
towards the other side of the road and landed on a nearby Jolet Ramos; P10,000.00 as moral damages; and P5,000.00
residential lot, hitting a coconut tree and felling it." (Rollo, pp. 48- as exemplary damages; and
50) 4. To plaintiffs Narciso and Adoracion Himaya, the amount
After a careful perusal of the circumstances of the case, the trial of P30,000.00 as indemnity for the death of their son,
court reached the conclusion "that the negligent acts of both Enrico Himaya, P10,000.00 as moral damages; and
drivers contributed to or combined with each other in directly P5,000.00 as exemplary damages; and
causing the accident which led to the death of the aforementioned 5. To plaintiffs Jose and Ma. Commemoracion Bersamina,
persons. It could not be determined from the evidence that it was the sum of P30,000.00 as indemnity for the death of their
only the negligent act of one of them which was the proximate son, Noel Bersamina, P10,000.00 as moral damages and
cause of the collision. In view of this, the liability of the two drivers P5,000.00 as exemplary damages.
for their negligence must be solidary. (Rollo, pp. 50-51) The defendants are also required to pay the plaintiffs the
Accordingly, the trial court rendered a decision on March 7, 1986, sum of P10,000.00 as attorney's fees and to pay the costs of
the dispositive portion is hereunder quoted as follows: the suit.

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The cross-claim of defendant Novelo is hereby allowed, and Second. Whether the respondent court can validly and
defendants Magtibay and Serrado, the actual owners legally disregard the findings of fact made by the trial court
and/or operators of the passenger bus concerned, are which was in a better position to observe the conduct and
hereby ordered to indemnify Novelo in such amount as he demeanor of the witnesses, particularly appellant Edilberto
may be required to pay as damages to the plaintiffs. Montesiano, cargo truck driver, and which conclusively
The cross-claims and counter-claims of the other found appellant Montesiano as jointly and severally
defendants are hereby dismissed for lack of merit. negligent in driving his truck very fast and had lost control
SO ORDERED. (pp. 55-57, Rollo) of his truck.
From said decision, only defendants Federico del Pilar and Third. Whether the respondent court has properly and
Edilberto Montesiano, owner and driver, respectively, of the sand legally applied the doctrine of "last clear chance" in the
and gravel truck have interposed an appeal before the respondent present case despite its own finding that appellant cargo
Court of Appeals. The Court of Appeals decided the appeal on a truck driver Edilberto Montesiano was admittedly negligent
different light. It rendered judgment on February 15, 1989, to wit: in driving his cargo truck very fast on a descending road
WHEREFORE, the appealed judgment is hereby REVERSED and in the presence of the bus driver coming from the
and SET ASIDE and the complaint dismissed insofar as opposite direction.
defendants-appellants Federico del Pilar and Edilberto Fourth. Whether the respondent court has applied the
Montesiano are concerned. No costs in this instance. correct law and the correct doctrine so as to reverse and set
SO ORDERED. (p. 96, Rollo) aside the judgment with respect to defendants-appellants.
On March 9, 1989, the plaintiffs-appellees filed a motion for (Rollo, pp. 133-134)
reconsideration of the aforementioned Court of Appeals' decision. As a rule, findings of fact of the Court of Appeals are final and
However, respondent Court of Appeals in a resolution dated August conclusive and cannot be reviewed on appeal, provided, they are
17, 1989 denied the motion for lack of merit. Hence, this petition. borne out by the record or are based on substantial evidence
Petitioners raised the following questions of law, namely: However, this rule admits of certain exceptions, as when the
First. Whether the respondent Court can legally and validly findings of facts are conclusions without citation of specific
absolve defendants-appellants from liability despite its own evidence on which they are based; or the appellate court's findings
finding, as well as that of the trial court that defendant- are contrary to those of the trial court. (Sese v. Intermediate
appellant Edilberto Montesiano, the cargo truck driver, was Appellate Court, G.R. 66168, 31 July 1987, 152 SCRA 585).
driving an old vehicle very fast, with its wheels already Furthermore, only questions of law may be raised in a petition for
wiggling, such that he had no more control of his truck. review on certiorari under Rule 45 of the Revised Rules of Court.
The jurisdiction of the Supreme Court in cases brought to it from

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the Court of Appeals is limited to reviewing and revising the errors the road even down to its shoulder. And yet, Susulin shifted
of law imputed to it, its findings of fact being conclusive. It is not to third gear so as to, as claimed by him, give more power
the function of the Supreme Court to analyze or weigh such and speed to his bus in overtaking or passing a hand
evidence all over again, its jurisdiction being limited to reviewing tractor which was being pushed along the shoulder of the
errors of law that might have been committed. Barring, therefore, a road. (Rollo, p. 50)
showing that the findings complained of are totally devoid of The respondent Court of Appeals ruling on the contrary, opined
support in the records, or that they are so glaringly erroneous as to that "the bus driver had the last clear chance to avoid the collision
constitute serious abuse of discretion, such findings must stand and his reckless negligence in proceeding to overtake the hand
for the Supreme Court is not expected or required to examine or tractor was the proximate cause of the collision." (Rollo, p. 95). Said
contrast the oral and documentary evidence submitted by the court also noted that "the record also discloses that the bus driver
parties. (Andres v. Manufacturers Hanover and Trust Corp., G.R. was not a competent and responsible driver. His driver's license
82670, 15 September 1989, 177 SCRA 618). was confiscated for a traffic violation on April 17, 1983 and he was
Bearing in mind these basic principles, We have opted to re- using a ticket for said traffic violation on the day of the accident in
examine the findings of fact mainly because the appellate court's question (pp. 16-18, TSN, July 23, 1984). He also admitted that he
findings are contrary to those of the trial court. was not a regular driver of the bus that figured in the mishap and
The trial court, in declaring that the negligent acts of both drivers was not given any practical examination. (pp. 11, 96, TSN, supra)."
directly caused the accident which led to the death of the (Rollo, p96)
aforementioned persons, considered the following: The respondent Court quoting People v. Vender, CA-G.R. 11114-
It was negligent on the part of driver Montesiano to have 41-CR, August 28, 1975 held that "We are not prepared to uphold
driven his truck fast, considering that it was an old vehicle, the trial court's finding that the truck was running fast before the
being a 1947 model as admitted by its owner, defendant Del impact. The national road, from its direction, was descending.
Pilar; that its front wheels were wiggling; that the road was Courts can take judicial notice of the fact that a motor vehicle
descending; and that there was a passenger bus going down or descending is more liable to get out of control than
approaching it. Likewise, driver Susulin was also guilty of one that is going up or ascending for the simple reason that the
negligence in not taking the necessary precaution to avoid one which is going down gains added momentum while that which
the collision, in the light of his admission that, at a distance is going up loses its initial speeding in so doing."
of 30 meters, he already saw the front wheels of the truck On the other hand, the trial court found and We are convinced that
wiggling and that the vehicle was usurping his lane coming the cargo truck was running fast. It did not overlook the fact that
towards his direction. Had he exercised ordinary prudence, the road was descending as in fact it mentioned this circumstance
he could have stopped his bus or swerved it to the side of as one of the factors disregarded by the cargo truck driver along

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with the fact that he was driving an old 1947 cargo truck whose In the recent case of Philippine Rabbit Bus Lines, Inc. v.
front wheels are already wiggling and the fact that there is a Intermediate Appellate Court, et al. (G.R. Nos. 66102-04, August
passenger bus approaching it. In holding that the driver of the 30, 1990), the Court citing the landmark decision held in the case
cargo truck was negligent, the trial court certainly took into of Anuran, et al. v. Buno, et al. (123 Phil. 1073) ruled that the
account all these factors so it was incorrect for the respondent principle of "last clear chance" applies "in a suit between the
court to disturb the factual findings of the trial court, which is in a owners and drivers of colliding vehicles. It does not arise where a
better position to decide the question, having heard the witness passenger demands responsibility from the carrier to enforce its
themselves and observed their deportment. contractual obligations. For it would be inequitable to exempt the
The respondent court adopted the doctrine of "last clear chance." negligent driver of the jeepney and its owners on the ground that
The doctrine, stated broadly, is that the negligence of the plaintiff the other driver was likewise guilty of negligence."
does not preclude a recovery for the negligence of the defendant Furthermore, "as between defendants: The doctrine cannot be
where it appears that the defendant, by exercising reasonable care extended into the field of joint tortfeasors as a test of whether only
and prudence, might have avoided injurious consequences to the one of them should be held liable to the injured person by reason
plaintiff notwithstanding the plaintiff's negligence. In other words, of his discovery of the latter's peril, and it cannot be invoked as
the doctrine of last clear chance means that even though a between defendants concurrently negligent. As against third
person's own acts may have placed him in a position of peril, and persons, a negligent actor cannot defend by pleading that another
an injury results, the injured person is entitled to recovery. As the had negligently failed to take action which could have avoided the
doctrine is usually stated, a person who has the last clear chance injury." (57 Am. Jur. 2d, pp. 806-807).
or opportunity of avoiding an accident, notwithstanding the All premises considered, the Court is convinced that the
negligent acts of his opponent or that of a third person imputed to respondent Court committed an error of law in applying the
the opponent is considered in law solely responsible for the doctrine of last clear chance as between the defendants, since the
consequences of the accident. (Sangco, Torts and Damages, 4th case at bar is not a suit between the owners and drivers of the
Ed., 1986, p. 165). colliding vehicles but a suit brought by the heirs of the deceased
The practical import of the doctrine is that a negligent defendant is passengers against both owners and drivers of the colliding
held liable to a negligent plaintiff, or even to a plaintiff who has vehicles. Therefore, the respondent court erred in absolving the
been grossly negligent in placing himself in peril, if he, aware of the owner and driver of the cargo truck from liability.
plaintiffs peril, or according to some authorities, should have been Pursuant to the new policy of this Court to grant an increased
aware of it in the reasonable exercise of due case, had in fact an death indemnity to the heirs of the deceased, their respective
opportunity later than that of the plaintiff to avoid an accident (57 awards of P30,000.00 are hereby increased to P50,000.00.
Am. Jur., 2d, pp. 798-799).

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ACCORDINGLY, the petition is GRANTED; the appealed judgment
and resolution of the Court of Appeals are hereby REVERSED and
SET ASIDE and the judgment of the lower court is REINSTATED
with the modification on the indemnity for death of each of the
victims which is hereby increased to P50,000.00 each. No
pronouncement as to costs.
SO ORDERED.

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THIRD DIVISION INSTANTANEOUSLY OR BY AVAILABLE MEANS. This doctrine
of last chance has no application to a case where a person is to act
[G.R. Nos. 79050-51. November 14, 1989.] instantaneously, and if the injury cannot be avoided by using all
means available after the peril is or should have been discovered.
PANTRANCO NORTH EXPRESS, INC., Petitioner, v. MARICAR
BASCOS BAESA, thru her personal guardian FRANCISCA O. 4. ID.; ID.; PROVISION OF R.A. NO. 4136 RE VEHICLE ENTERING
BASCOS, FE O. ICO, in her behalf and in behalf of her minor A THROUGH HIGHWAY OR A STOP INTERSECTION. Section 43
children, namely ERWIN, OLIVE, EDMUNDO and SHARON ICO, (c), Article III, Chapter IV of Republic Act No. 1436 cannot apply to
Respondents. case a bar where at the time of the accident, the jeepney had
already crossed the intersection.
Efren N. Ambrosio & Associates for petitioner PNEI.
5. ID.; ID.; NEGLIGENCE; BURDEN OF PROOF LIES ON THE
Emiliano S. Micu for Respondents. EMPLOYER. A finding of negligence on the part of the driver
establishes a presumption that the employer has been negligent
SYLLABUS and the latter has the burden of proof that it has exercised due
negligence not only in the selection of its employees but also in
1. CIVIL LAW; DAMAGES; LAST CLEAR CHANCE DOCTRINE; adequately supervising their work.
WHEN APPLICABLE. The doctrine of last clear chance applies
only in a situation where the defendant, having the last fair chance 6. ID.; ID.; FAILURE TO PRESENT EVIDENCE TO SUPPORT CLAIM
to avoid the impending harm and failed to do so, becomes liable for FOR DAMAGES. Plaintiffs failure to present documentary
all the consequences of the accident notwithstanding the prior evidence to support their claim for damages for loss of earning
negligence of the plaintiff. capacity of the deceased victim does not bar recovery of the
damages, if such loss may be based sufficiently on their
2. ID.; ID.; ID.; CONDITION TO MAKE DOCTRINE APPLICABLE. testimonies.
In order that the doctrine of last clear chance may be applied, it
must be shown that the person who allegedly had the last 7. ID.; ID.; INDEMNITY FIXED AT P30,000. The indemnity for
opportunity to avert the accident was aware of the existence of the the death of a person was fixed by this Court at (P30,000.00).
peril or with exercise of due care should have been aware of it.
DECISION
3. ID.; ID.; ID.; NOT APPLICABLE TO PERSON ACTING

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CORTES, J.:
As a result of the accident David Ico, spouses Ceasar Baesa and
In this Petition, Pantranco North Express Inc. (PANTRANCO), asks Marilyn Baesa and their children, Harold Jim and Marcelino
the Court to review the decision of the Court of Appeals in CA-G.R. Baesa, died while the rest of the passengers suffered injuries. The
No. 05494-95 which affirmed the decisions of the Court of First jeepney was extensively damaged. After the accident the driver of
Instance of Rosales, Pangasinan in Civil Case No. 561-R and Civil the PANTRANCO Bus, Ambrosio Ramirez, boarded a car and
Case No. 589-R wherein PANTRANCO was ordered to pay damages proceeded to Santiago, Isabela. From that time on up to the
and attorneys fees to herein private respondents.chanrobles present, Ramirez has never been seen and has apparently
virtual lawlibrary remained in hiding.

The pertinent fact are as follows:chanrob1es virtual 1aw library All the victims and/or their surviving heirs except herein private
respondents settled the case amicably under the "No Fault"
At about 7:00 oclock in the morning of June 12, 1981, the spouses insurance coverage of PANTRANCO.
Ceasar and Marilyn Baesa and their children Harold Jim,
Marcelino and Maricar, together with spouses David Ico and Fe O. Maricar Baesa through her guardian Francisca O. Bascos and Fe
Ico with their son Erwin Ico and seven other persons, were aboard O. Ico for herself and for her minor children, filed separate actions
a passenger jeepney on their way to a picnic at Malalam River, for damages arising from quasi-delict against PANTRANCO,
Ilagan, Isabela, to celebrate the fifth wedding anniversary of Ceasar respectively docketed as Civil Case No. 561-R and 589-R of the
and Marilyn Baesa. Court of First Instance of Pangasinan.

The group, numbering fifteen (15) persons, rode in the passenger In its answer, PANTRANCO, aside from pointing to the late David
jeepney driven by David Ico, who was also the registered owner Icos alleged negligence as the proximate cause of the accident,
thereof. From Ilagan, Isabela, they proceeded to Barrio Capayacan invoked the defense of due diligence in the selection and
to deliver some viands to one Mrs. Bascos and thenceforth to San supervision of its driver, Ambrosio
Felipe, taking the highway going to Malalam River. Upon reaching Ramirez.chanroblesvirtualawlibrary
the highway, the jeepney turned right and proceeded to Malalam
River at a speed of about 20 kph. While they were proceeding On July 3, 1984, the CFI of Pangasinan rendered a decision
towards Malalam River, a speeding PANTRANCO bus from Aparri, against PANTRANCO awarding the total amount of Two Million
on its regular route to Manila, encroached on the jeepneys lane Three Hundred Four Thousand Six Hundred Forty-Seven
while negotiating a curve, and collided with it. (P2,304,647.00) as damages, plus 10% thereof as attorneys fees

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and costs to Maricar Baesa in Civil Case No. 561-R, and the total and Marcelino Baesa P30,000.00;
amount of Six Hundred Fifty Two Thousand Six Hundred Seventy-
Two Pesos (P652,672.00) as damages, plus 10% thereof as D) For the loss of earnings of Ceasar Baesa P630,000.00;
attorneys fees and costs to Fe Ico and her children in Civil Case
No. 589-R. On appeal, the cases were consolidated and the Court E) For the loss of earnings of Marilyn Bascos Baesa
of Appeals modified the decision of the trial court by ordering P375,000.00;
PANTRANCO to pay the total amount of One Million One Hundred
Eighty-Nine Thousand Nine Hundred Twenty Seven Pesos F) For the burial expenses of the deceased Ceasar and Marilyn
(P1,189,927.00) as damages, plus Twenty Thousand Pesos Baesa P41,200.00;
(P20,000.00) as attorneys fees to Maricar Baesa, and the total
amount of Three Hundred Forty-Four Thousand Pesos G) For hospitalization expenses of Maricar Baesa P3,727.00;
(P344,000.00) plus Ten Thousand Pesos (P10,000.00) as attorneys
fees to Fe Ico and her children, and to pay the costs in both cases. H) As moral damages P50,000.00;
The dispositive portion of the assailed decision reads as
follows:chanrob1es virtual 1aw library I) As attorneys fees P20,000.00;

WHEREFORE, the decision appealed from is hereby modified by II. The plaintiffs in Civil Case No. 589-R, the following
ordering the defendant PANTRANCO North Express, Inc. to damages:chanrob1es virtual 1aw library
pay:chanrob1es virtual 1aw library
A) As compensatory damages for the death of David Ico
I. The plaintiff in Civil Case No. 561-R, Maricar Bascos Baesa, the P30,000.00;
following damages:chanrob1es virtual 1aw library
B) For loss of earning capacity of David Ico P252,000.00;
A) As compensatory damages for the death of Ceasar Baesa
P30,000.00; C) As moral damages for the death of David Ico and the injury of Fe
Ico P30,000.00
B) As compensatory damages for the death of Marilyn Baesa
P30,000.00; D) As payment for the jeepney P20,000.00;

C) As compensatory damages for the death of Harold Jim Baesa E) For the hospitalization of Fe Ico P12,000.000;

Page 199 of 205


the case of Ong v. Metropolitan Water District, 104 Phil. 397
F) And for attorneys fees P10,000.00; (1958), in this wise:chanrob1es virtual 1aw library

and to pay the costs in both cases. The doctrine of the last clear chance simply, means that the
negligence of a claimant does not preclude a recovery for the
The amount of P25,000 paid to Maricar Bascos Baesa, plaintiff in negligence of defendant where it appears that the latter, by
Civil Case No. 561-R, and the medical expenses in the sum of exercising reasonable care and prudence, might have avoided
P3,273.55, should be deducted from the award in her injurious consequences to claimant notwithstanding his
favor.chanrobles virtual lawlibrary negligence.

All the foregoing amounts herein awarded except the costs shall The doctrine applies only in a situation where the plaintiff was
earn interest at the legal rate from date of this decision until fully guilty of prior or antecedent negligence but the defendant, who had
paid. [CA Decision, pp. 14-15; Rollo, pp. 57-58.] the last fair chance to avoid the impending harm and failed to do
so, is made liable for all the consequences of the accident
PANTRANCO filed a motion for reconsideration of the Court of notwithstanding the prior negligence of the plaintiff [Picart v.
Appeals decision, but on June 26, 1987, it denied the same for Smith, 37 Phil. 809 (1918); Glan Peoples Lumber and Hardware,
lack of merit. PANTRANCO then filed the instant petition for Et. Al. v. Intermediate Appellate Court, Cecilia Alferez Vda. de
review. Calibo, Et Al., G.R. No. 70493, May 18, 1989]. The subsequent
I negligence of the defendant in failing to exercise ordinary care to
avoid injury to plaintiff becomes the immediate or proximate cause
of the accident which intervenes between the accident and the
Petitioner faults the Court of Appeals for not applying the doctrine more remote negligence of the plaintiff, thus making the defendant
of the "last clear chance" against the jeepney driver. Petitioner liable to the plaintiff [Picart v. Smith, supra].
claims that under the circumstances of the case, it was the driver
of the passenger jeepney who had the last clear chance to avoid the Generally, the last clear chance doctrine is invoked for the purpose
collision and was therefore negligent in failing to utilize with of making a defendant liable to a plaintiff who was guilty of prior or
reasonable care and competence his then existing opportunity to antecedent negligence, although it may also be raised as a defense
avoid the harm. to defeat claim for damages.chanrobles lawlibrary : rednad

The doctrine of the last clear chance was defined by this Court in To avoid liability for the negligence of its driver, petitioner claims

Page 200 of 205


that the original negligence of its driver was not the proximate that the bus could not return to its own lane or was prevented from
cause of the accident and that the sole proximate cause was the returning to the proper lane by anything beyond the control of its
supervening negligence of the jeepney driver David Ico in failing to driver. Leo Marantan, an alternate driver of the Pantranco bus who
avoid the accident. It is petitioners position that even assuming was seated beside the driver Ramirez at the time of the accident,
arguendo, that the bus encroached into the lane of the jeepney, the testified that Ramirez had no choice but to swerve the steering
driver of the latter could have swerved the jeepney towards the wheel to the left and encroach on the jeepneys lane because there
spacious dirt shoulder on his right without danger to himself or his was a steep precipice on the right [CA Decision, p. 2; Rollo, p. 45].
passengers. However, this is belied by the evidence on record which clearly
shows that there was enough space to swerve the bus back to its
The above contention of petitioner is manifestly devoid of merit. own lane without any danger [CA Decision, p. 7; Rollo, p. 50].

Contrary to the petitioners contention, the doctrine of "last clear Moreover, both the trial court and the Court of Appeals found that
chance" finds no application in this case. For the doctrine to be at the time of the accident the Pantranco bus was speeding
applicable, it is necessary to show that the person who allegedly towards Manila [CA Decision, p. 2; Rollo, p. 45]. By the time David
had the last opportunity to avert the accident was aware of the Ico must have realized that the bus was not returning to its own
existence of the peril or should, with exercise of due care, have lane, it was already too late to swerve the jeepney to his right to
been aware of it. One cannot be expected to avoid an accident or prevent an accident. The speed at which the approaching bus was
injury if he does not know or could not have known the existence running prevented David Ico from swerving the jeepney to the right
of the peril. In this case, there is nothing to show that the jeepney shoulder of the road in time to avoid the collision. Thus, even
driver David Ico knew of the impending danger. When he saw at a assuming that the jeepney driver perceived the danger a few
distance that the approaching bus was encroaching on his lane, he seconds before the actual collision, he had no opportunity to avoid
did not immediately swerve the jeepney to the dirt shoulder on his it. This Court has held that the last clear chance doctrine "can
right since he must have assumed that the bus driver will return never apply where the party charged is required to act
the bus to its own lane upon seeing the jeepney approaching from instantaneously, and if the injury cannot be avoided by the
the opposite direction. As held by this Court in the case of Vda. De application of all means at hand after the peril is or should have
Bonifacio v. BLTB, G.R. No. L-26810, August 31, 1970, 34 SCRA been discovered" [Ong v. Metropolitan Water District,
618, a motorist who is properly proceeding on his own side of the supra].chanrobles.com : virtual law library
highway is generally entitled to assume that an approaching
vehicle coming towards him on the wrong side, will return to his Petitioner likewise insists that David Ico was negligent in failing to
proper lane of traffic. There was nothing to indicate to David Ico observe Section 43 (c), Article III Chapter IV of Republic Act No.

Page 201 of 205


4136 * which provides that the driver of a vehicle entering a On the issue of its liability as an employer, petitioner claims that it
through highway or a stop intersection shall yield the right of way had observed the diligence of a good father of a family to prevent
to all vehicles approaching in either direction on such through damage, conformably to the last paragraph of Article 2180 of the
highway. Civil Code. Petitioner adduced evidence to show that in hiring its
drivers, the latter are required to have professional drivers license
Petitioners misplaced reliance on the aforesaid law is readily and police clearance. The drivers must also pass written
apparent in this case. The cited law itself provides that it applies examinations, interviews and practical driving tests, and are
only to vehicles entering a through highway or a stop intersection. required to undergo a six-month training period. Rodrigo San
At the time of the accident, the jeepney had already crossed the Pedro, petitioners Training Coordinator, testified on petitioners
intersection and was on its way to Malalam River. Petitioner itself policy of conducting regular and continuing training programs and
cited Fe Icos testimony that the accident occurred after the safety seminars for its drivers, conductors, inspectors and
jeepney had travelled a distance of about two (2) meters from the supervisors at a frequency rate of at least two (2) seminars a
point of intersection [Petition p. 10; Rollo, p. 27]. In fact, even the month.
witness for the petitioner, Leo Marantan, testified that both
vehicles were coming from opposite directions [CA Decision, p. 7; On this point, the Court quotes with approval the following
Rollo, p. 50], clearly indicating that the jeepney had already findings of the trial court which was adopted by the Court of
crossed the intersection. Appeals in its challenged decision:chanrob1es virtual 1aw library

Considering the foregoing, the Court finds that the negligence of When an injury is caused by the negligence of an employee, there
petitioners driver in encroaching into the lane of the incoming instantly arises a presumption that the employer has been
jeepney and in failing to return the bus to its own lane immediately negligent either in the selection of his employees or in the
upon seeing the jeepney coming from the opposite direction was supervision over their acts. Although this presumption is only a
the sole and proximate cause of the accident without which the disputable presumption which could be overcome by proof of
collision would not have occurred. There was no supervening or diligence of a good father of a family, this Court believes that the
intervening negligence on the part of the jeepney driver which evidence submitted by the defendant to show that it exercised the
would have made the prior negligence of petitioners driver a mere diligence of a good father of a family in the case of Ramirez, as a
remote cause of the accident. company driver is far from sufficient. No support evidence has
II been adduced. The professional drivers license of Ramirez has not
been produced. There is no proof that he is between 25 to 38 years
old. There is also no proof as to his educational attainment, his

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age, his weight and the fact that he is married or not. Neither are June 30, 1976, 69 SCRA 623]. Contrary to petitioners claim, there
the result of the written test, psychological and physical test, is no presumption that the usual recruitment procedures and
among other tests, have been submitted in evidence [sic]. His NBI safety standards were observed. The mere issuance of rules and
or police clearances and clearances from previous employment regulations and the formulation of various company policies on
were not marked in evidence. No evidence was presented that safety, without showing that they are being complied with, are not
Ramirez actually and really attended the seminars. Vital evidence sufficient to exempt petitioner from liability arising from the
should have been the certificate of attendance or certificate of negligence of its employee. It is incumbent upon petitioner to show
participation or evidence of such participation like a logbook signed that in recruiting and employing the erring driver, the recruitment
by the trainees when they attended the seminars. If such records procedures and company policies on efficiency and safety were
are not available, the testimony of the classmates that Ramirez was followed. Petitioner failed to do this. Hence, the Court finds no
their classmate in said seminar (should have been presented) [CA cogent reason to disturb the finding of both the trial court and the
Decision, pp. 8-9; Rollo, pp. 51-52].chanrobles law library Court of Appeals that the evidence presented by the petitioner,
which consists mainly of the uncorroborated testimony of its
Petitioner contends that the fact that Ambrosio Ramirez was Training Coordinator, is insufficient to overcome the presumption
employed and remained as its driver only means that he of negligence against petitioner.cralawnad
underwent the same rigid selection process and was subjected to III
the same strict supervision imposed by petitioner on all applicants
and employees. It is argued by the petitioner that unless proven
otherwise, it is presumed that petitioner observed its usual On the question of damages, petitioner claims that the Court of
recruitment procedure and company polices on safety and Appeals erred in fixing the damages for the loss of earning capacity
efficiency [Petition, p. 20; Rollo, p. 37]. of the deceased victims. Petitioner assails respondent courts
findings because no documentary evidence in support thereof,
The Court finds the above contention unmeritorious. such as income tax returns, pay-rolls, pay slips or invoices
obtained in the usual course of business, were presented [Petition,
The finding of negligence on the part of its driver Ambrosio Ramirez p. 22; Rollo, p. 39]. Petitioner argues that the "bare and self-serving
gave rise to the presumption of negligence on the part of petitioner testimonies of the wife of the deceased David Ico and the mother of
and the burden of proving that it exercised due diligence not only the deceased Marilyn Baesa . . . have no probative value to sustain
in the selection of its employees but also in adequately supervising in law the Court of Appeals conclusion on the respective earnings
their work rests with the petitioner [Lilius v. Manila Railroad of the deceased victims." [Petition, pp. 21-22; Rollo, pp. 38-39.] It is
Company, 59 Phil. 758 (1934); Umali v. Bacani, G.R. No. L-40570, petitioners contention that the evidence presented by the private

Page 203 of 205


respondent does not meet the requirements of clear and Bascos, in fixing the amount of damages for the loss of earning
satisfactory evidence to prove actual and compensatory damages. capacity of David Ico and the spouses
Baesa.chanrobles.com:cralaw:red
The Court finds that the Court of Appeals committed no reversible
error in fixing the amount of damages for the loss of earning However, it should be pointed out that the Court of Appeals
capacity of the deceased victims. While it is true that private committed error in fixing the compensatory damages for the death
respondents should have presented documentary evidence to of Harold Jim Baesa and Marcelino Baesa. Respondent court
support their claim for damages for loss of earning capacity of the awarded to plaintiff (private respondent) Maricar Baesa Thirty
deceased victims, the absence thereof does not necessarily bar the Thousand Pesos (P30,000.00) as "compensatory damages for the
recovery of the damages in question. The testimony of Fe Ico and death of Harold Jim Baesa and Marcelino Baesa." [CA Decision, p.
Francisca Bascos as to the earning capacity of David Ico, and the 14; Rollo, 57]. In other words, the Court of Appeals awarded only
spouses Baesa, respectively, are sufficient to establish a basis from Fifteen Thousand Pesos (P15,000.00) as indemnity for the death of
which the court can make a fair and reasonable estimate of the Harold Jim Baesa and another Fifteen Thousand Pesos
damages for the loss of earning capacity of the three deceased (P15,000.00) for the death of Marcelino Baesa. This is clearly
victims. Moreover, in fixing the damages for loss of earning erroneous. In the case of People v. de la Fuente, G.R. Nos. 63251-
capacity of a deceased victim, the court can consider the nature of 52, December 29, 1983, 126 SCRA 518, the indemnity for the
his occupation, his educational attainment and the state of his death of a person was fixed by this Court at Thirty Thousand Pesos
health at the time of death. (P30,000.00). Plaintiff Maricar Baesa should therefore be awarded
Sixty Thousand Pesos (P60,000.00) as indemnity for the death of
In the instant case, David Ico was thirty eight (38) years old at the her brothers, Harold Jim Baesa and Marcelino Baesa or Thirty
time of his death in 1981 and was driving his own passenger Thousand Pesos (P30,000.00) for the death of each brother.
jeepney. The spouses Ceasar and Marilyn Baesa were both thirty
(30) years old at the time of their death. Ceasar Baesa was a The other items of damages awarded by respondent court which
commerce degree holder and the proprietor of the Cauayan Press, were not challenged by the petitioner are hereby affirmed.
printer of the Cauayan Valley Newspaper and the Valley Times at
Cauayan, Isabela. Marilyn Baesa graduated as a nurse in 1976 WHEREFORE, premises considered, the petition is DENIED, and
and at the time of her death, was the company nurse, personnel the decision of respondent Court of Appeals is hereby AFFIRMED
manager, treasurer and cashier of the Ilagan Press at Ilagan, with the modification that the amount of compensatory damages
Isabela. Respondent court duly considered these factors, together for the death of Harold Jim Baesa and Marcelino Baesa are
with the uncontradicted testimonies of Fe Ico and Francisca increased to Thirty Thousand Pesos (P30,000.00) each.chanrobles

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law library

SO ORDERED.

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