B. ELEMENTS OF QUASI DELICT 4.
4. This compromise agreement shall be a full and final settlement
1. ACT OR OMISSION
G.R. No. 106436 December 3, 1994
VIRGILIO D. IMSON, petitioner,
vs.
HON. COURT OF APPEALS, HOLIDAY HILLS STOCK AND
BREEDING FARM CORPORATION, FNCB FINANCE
CORPORATION, respondents.
PUNO, J.:
The case at bench arose from a vehicular collision on
December 11, 1983, involving petitioner's Toyota Corolla and a
Hino diesel truck registered under the names of private
respondents FNCB Finance Corporation and Holiday Hills
Stock and Breeding Farm Corporation. The collision seriously
injured petitioner and totally wrecked his car.
On January 6, 1984, petitioner filed with the RTC Baguio
City1 a Complaint for Damages2 Sued were private
respondents as registered owners of the truck; truck driver
Felix B. Calip, Jr.; the beneficial owners of the truck, Gorgonio
Co Adarme, Felisa T. Co (also known as Felisa Tan), and
Cirilia Chua Siok Bieng, and the truck insurer, Western
Guaranty Corporation.
The Complaint prayed that defendants be ordered to pay,
jointly and severally, two hundred seventy thousand pesos
(P270,000.00) as compensatory damages, fifty thousand
pesos (P50,000.00) each as moral and exemplary damages,
and attorney's fees, litigation expenses, and cost of suit.8
Defendants driver and beneficial owners failed to answer and
were declared in default.4 On May 29, 1987, however,
petitioner and defendant insurer, entered into a compromise
agreement which provided, inter alia:
1. Defendant Western Guaranty Corporation (Western
Guaranty for short) admits that its total liability under the laws
and the insurance contract sued upon is P70,000.00;
2. In full settlement of its liability under the laws and the said
insurance contract, defendant Western Guaranty shall pay
plaintiff (herein petitioner) the amount of P70,000.00 upon the
signing of this compromise agreement;
3. This compromise agreement shall in no way waive nor
prejudice plaintiffs (herein petitioner's) rights to proceed
against the other defendants with respect the remainder of his
claims;
of a just cause, and according to the answer filed by the Western
of the issues between plaintiff (herein petitioner) and defendant
Western Guaranty in their complaint and answer and, from now
on, they shall have no more right against one another except the
enforcement of this compromise agreement.
In consequence of the compromise agreement, the trial court
dismissed the Complaint for Damages against Western Guaranty
Corporation on June 16, 1987.8 A copy of the Order of dismissal
was received by private respondent Holiday Hills Stock and
Breeding Farm Corporation on July 13, 1987. Nearly eighteen
(18) months later, said private respondent moved to dismiss the
case against all the other defendants. It argued that since they are
all indispensable parties under a common cause of action, the
dismissal of the case against defendant insurer must result in the
dismissal of the suit against all of them. The trial court denied the
motion.
Private respondent Holiday Hills Stock and Breeding Farm
Corporation assailed the denial order through a Petition
for Certiorari, Prohibition and Mandamus With Restraining Order
filed with respondent Court of Appeals. The Petition was docketed
as CA-G.R. SP No. 17651. On July 10, 1992, the Court of
Appeals,7 through its Special Sixth Division,8 reversed the trial
court, as it ruled:
The petitioner (herein private respondent Holiday Hills Stock and
Breeding Farm Corporation) cites the doctrine laid down in Lim
Tanhu v. Hon. Ramolete, 66 SCRA 425, as applied later in Co v.
Acosta, 134 SCRA 185, to support its averment that the court a
quo gravely abused its discretion in refusing to dismiss the case.
Essentially, the doctrine adverted to essays that in a common
cause of action where all the defendants are indispensable
parties, the court's power to act is integral and cannot be split,
such that it cannot relieve any of them and at the same time
render judgment against the rest.
We find applicability of the doctrine to the case at bar.
A cursory reading of the complaint . . . reveals that the cause of
action was the alleged bad faith and gross negligence of the
defendants resulting in the injuries complained of and for which
the action for damages was filed. The inclusion of Western
Guaranty Corporation was vital to the claim, it being the insurer of
the diesel truck without which, the claim could be set for naught.
Stated otherwise, it is an indispensable party as the petitioner
(herein private respondent stock and breeding farm
corporation) . . . . Private respondent's (herein petitioner's
argument that the said insurance company was sued on a
different cause of action, i.e., its bounden duty under the
insurance law to pay or settle claims arising under its policy
coverage, is untenable, for the cited law perceives the existence
1
Guaranty Corporation . . . the proximate cause of the accident was
the fault of the plaintiff (herein petitioner), hence it was not liable
for damages. There is in fact a congruence of affirmative defense
among the answering defendants.
Moreover, it is undisputed that the injury caused is covered by the
insurance company concerned. Thus, when the said insurer
settled its liability with the private respondent (petitioner
herein) . . . , the other defendants, as the insured and
indispensable parties to a common cause of action, necessarily
benefited from such settlement including the defaulted
defendants, for as stated in the aforecited cases, it is deemed that
anything done by or for the answering defendant is done by or for
the ones in default since it is implicit in the rule that default is in
essence a mere formality that deprives them of no more than to
take part in the trial, but if the complaint is dismissed as to the
answering defendant, it should also be dismissed as to
them.9 (Citations omitted.)
Petitioner now comes to this Court with the following assignments
of error:
A.
RESPONDENT COURT OF APPEALS COMMITTED A
REVERSIBLE ERROR IN RULING THAT THE DEFENDANTS IN
CIVIL CASE NO. 248-R ARE INDISPENSABLE PARTIES;
B.
RESPONDENT COURT OF APPEALS COMMITTED A
REVERSIBLE ERROR IN RULING THAT IN CIVIL CASE NO.
248-R THERE IS A COMMON CAUSE OF ACTION AGAINST
THE DEFENDANTS THEREIN;
C.
RESPONDENT COURT OF APPEALS COMMITTED A
REVERSIBLE ERROR IN RULING THAT IN CIVIL CASE NO.
248-R THE RULING OF THIS HONORABLE COURT IN LIM TAN
HU VS. RAMOLETE IS APPLICABLE;
D.
RESPONDENT COURT OF APPEALS COMMITTED A
REVERSIBLE ERROR IN RULING THAT THE DOCTRINE OF
ESTOPPEL AND LACHES ON MATTERS OF JURISDICTION IS
NOT APPLICABLE IN CIVIL CASE NO. 248-R.
There is merit to the petition,.
In the case of Lim Tanhu v. Ramolete, 66 SCRA 425, 458-459
(1975) this court held that:
. . . (I)n all instances where a common cause of action is
alleged against several defendants, some of whom answer
and the others do not, the latter or those in default acquire a
vested right not only to own the defense interposed in the
answer of their co-defendant or co-defendants not in default
but also to expect a result of the litigation totally common with
them in kind and in amount whether favorable or unfavorable.
The substantive unity of the plaintiffs cause against all the
defendants is carried through to its adjective phase as
ineluctably demanded by the homogeneity and indivisibility of
justice itself. . . . The integrity of the common cause of action
against all the defendants and the indispensability of all of
them in the proceedings do not permit any possibility of waiver
of the plaintiffs right only as to one or some of them, without
including all of them, and so, as a rule, withdrawal must be
deemed to be a confession of weakness as to all. . . . . Where
all the defendants are indispensable parties, for which reason
the absence of any of them in the case would result in the
court losing its competency to act validly, any compromise that
the plaintiff might wish to make with any of them must, as a
matter of correct procedure, have to await until after the
rendition of the judgment, at which stage the plaintiff may then
treat the matter of its execution and the satisfaction of his
claim as variably as he might please. Accordingly, in the case
now before Us together with the dismissal of the complaint
against the non-defaulted defendants, the court should have
ordered also the dismissal thereof as to petitioner (referring to
the defaulting defendants in the case).
In sum, Lim Tanhu states that where a complaint alleges a
common cause of action against defendants who are all
indispensable parties to the case, its dismissal against any of
them by virtue of a compromise agreement with the plaintiff
necessarily results in the dismissal of the case against the
other defendants, including those in default. The ruling is
rooted on the rationale that the court's power to act in a case
involving a common cause of action against indispensable
parties "is integral and cannot be split such that it cannot
relieve any of them and at the same time render judgment
against the rest. 10
For Lim Tanhu to apply to the case at bench, it must be
established that: (1) petitioner has common cause of action
against private respondents and the other defendants in Civil
Case No. 248-R; and (2) all the defendants are indispensable
parties to the case.
Cause of action has a fixed meaning in this jurisdiction. It is
the delict or wrong by which the right of the plaintiff is violated
by the defendant. 11 The question as to whether a plaintiff has
a cause of action is determined by the averments in the
pleadings pertaining to the acts of the defendant. Whether such indispensable parties. They are merely proper parties to the case.
acts give him a right of action is determined by substantive law. 12 Proper parties have been described as parties whose presence is
necessary in order to adjudicate the whole controversy, but whose
In the case at bench, it is clear that petitioner has different and
interests are so far separable that a final decree can be made in
separate causes of action against the defendants in the case. The
their absence without affecting them.17 It is easy to see that if any
allegations in the Complaint show that petitioner seeks to recover
of them had not been impleaded as defendant, the case would still
from the truck driver for his wrong which caused injury to
proceed without prejudicing the party not impleaded. Thus, if
petitioner and his car. The cause of action against him is based on
petitioner did not sue Western Guaranty Corporation, the omission
quasi-delict under Article 2176 of the New Civil Code. Quasi-
would not cause the dismissal of the suit against the other
delict, too, is the basis of the cause of action against defendants
defendants. Even without the insurer, the trial court would not lose
beneficial and registered owners. But in their case, it is Article
its competency to act completely and validly on the damage suit.
2180 of the same Code which governs the rights of the parties.
The insurer, clearly, is not an indispensable party in Civil Case No.
However, with respect to defendant Western Guaranty 248-R.
Corporation, petitioner's cause of action is based on contract. He
IN VIEW WHEREOF, the instant petition is GRANTED. The
seeks to recover from the insurer on the basis of the third party
Decision, dated July 10, 1992, of the Court of Appeals in CA-G.R.
liability clause of its insurance contract with the owners of the
SP No. 17651 is REVERSED AND SET ASIDE. The Complaint in
truck. This is acknowledged by the second paragraph of the
Civil Case No. 248-R is REINSTATED and REMANDED to the trial
compromise agreement between petitioner and defendant insurer,
court for further proceedings. No costs.
thus:
SO ORDERED.
2. In full settlement of its liability under the laws and the said
insurance contract, defendant Western Guaranty shall pay plaintiff G.R. No. 74761 November 6, 1990
(herein petitioner) the amount of P70,000.00 upon the signing of
NATIVIDAD V. ANDAMO and EMMANUEL R.
this compromise agreement.
ANDAMO, petitioners, vs. INTERMEDIATE APPELLATE COURT
Quite clearly then, Lim Tanhu will not apply to the case at bench (First Civil Cases Division) and MISSIONARIES OF OUR LADY
for there is no showing that petitioner has a common cause of OF LA SALETTE, INC., respondents.
action against the defendants in Civil Case No. 248-R.
FERNAN, C.J.:
But this is not all. Defendants in Civil Case No. 248-R are not all
The pivotal issue in this petition for certiorari, prohibition and
indispensable parties. An indispensable party is one whose
mandamus is whether a corporation, which has built through its
interest will be affected by the court's action in the litigation, and
agents, waterpaths, water conductors and contrivances within its
without whom no final determination of the case can be had. The
land, thereby causing inundation and damage to an adjacent land,
party's interest in the subject matter of the suit and in the relief
can be held civilly liable for damages under Articles 2176 and
sought are so inextricably intertwined with the other parties' that
2177 of the Civil Code on quasi-delicts such that the resulting civil
his legal presence as a party to the proceeding is an absolute
case can proceed independently of the criminal case.
necessity. 13 In his absence there cannot be a resolution of the
dispute of the parties before the court which is effective, complete, The antecedent facts are as follows:
or equitable.14
Petitioner spouses Emmanuel and Natividad Andamo are the
Conversely, a party is not indispensable to the suit if his interest in owners of a parcel of land situated in Biga (Biluso) Silang, Cavite
the controversy or subject matter is distinct and divisible from the which is adjacent to that of private respondent, Missionaries of
interest of the other parties and will not necessarily be prejudiced Our Lady of La Salette, Inc., a religious corporation.
by a judgment which does complete justice to the parties in
court.15 He is not indispensable if his presence would merely Within the land of respondent corporation, waterpaths and
permit complete relief between him and those already parties to contrivances, including an artificial lake, were constructed, which
the action, or will simply avoid multiple litigation.16 allegedly inundated and eroded petitioners' land, caused a young
man to drown, damaged petitioners' crops and plants, washed
It is true that all of petitioner's claims in Civil Case No. 248-R is away costly fences, endangered the lives of petitioners and their
premised on the wrong committed by defendant truck driver. laborers during rainy and stormy seasons, and exposed plants
Concededly, the truck driver is an indispensable party to the suit. and other improvements to destruction.
The other defendants, however, cannot be categorized as
2
In July 1982, petitioners instituted a criminal action, docketed
as Criminal Case No. TG-907-82, before the Regional Trial
Court of Cavite, Branch 4 (Tagaytay City), against Efren
Musngi, Orlando Sapuay and Rutillo Mallillin, officers and
directors of herein respondent corporation, for destruction by
means of inundation under Article 324 of the Revised Penal
Code.
Subsequently, on February 22, 1983, petitioners filed another
action against respondent corporation, this time a civil case,
docketed as Civil Case No. TG-748, for damages with prayer
for the issuance of a writ of preliminary injunction before the
same court. 1
On March 11, 1983, respondent corporation filed its answer to
the complaint and opposition to the issuance of a writ of
preliminary injunction. Hearings were conducted including
ocular inspections on the land. However, on April 26, 1984, the
trial court, acting on respondent corporation's motion to
dismiss or suspend the civil action, issued an
order suspending further hearings in Civil Case No, TG-748
until after judgment in the related Criminal Case No. TG-907-
82.
Resolving respondent corporation's motion to dismiss filed on
June 22, 1984, the trial court issued on August 27, 1984 the
disputed order dismissing Civil Case No. TG-748 for lack of
jurisdiction, as the criminal case which was instituted ahead of
the civil case was still unresolved. Said order was anchored on
the provision of Section 3 (a), Rule III of the Rules of Court
which provides that "criminal and civil actions arising from the
same offense may be instituted separately, but after the
criminal action has been commenced the civil action cannot be
instituted until final judgment has been rendered in the criminal
action." 2
Petitioners appealed from that order to the Intermediate
Appellate Court. 3
On February 17, 1986, respondent Appellate Court, First Civil
Cases Division, promulgated a decision 4 affirming the
questioned order of the trial court. 5 A motion for
reconsideration filed by petitioners was denied by the
Appellate Court in its resolution dated May 19, 1986. 6
Directly at issue is the propriety of the dismissal of Civil Case
No. TG-748 in accordance with Section 3 (a) of Rule 111 of the
Rules of Court. Petitioners contend that the trial court and the
Appellate Court erred in dismissing Civil Case No. TG-748
since it is predicated on a quasi-delict. Petitioners have raised
a valid point.
It is axiomatic that the nature of an action filed in court is
determined by the facts alleged in the complaint as constituting
the cause of action. 7 The purpose of an action or suit and the law
to govern it, including the period of prescription, is to be
determined not by the claim of the party filing the action, made in
his argument or brief, but rather by the complaint itself, its
allegations and prayer for relief. 8 The nature of an action is not
necessarily determined or controlled by its title or heading but the
body of the pleading or complaint itself. To avoid possible denial of
substantial justice due to legal technicalities, pleadings as well as
remedial laws should be liberally construed so that the litigants
may have ample opportunity to prove their respective claims. 9
Quoted hereunder are the pertinent portions of petitioners'
complaint in Civil Case No. TG-748:
4) That within defendant's land, likewise located at Biga (Biluso),
Silang, Cavite, adjacent on the right side of the aforesaid land of
plaintiffs, defendant constructed waterpaths starting from the
middle-right portion thereof leading to a big hole or opening, also
constructed by defendant, thru the lower portion of its concrete
hollow-blocks fence situated on the right side of its cemented gate
fronting the provincial highway, and connected by defendant to a
man height inter-connected cement culverts which were also
constructed and lain by defendant cross-wise beneath the tip of
the said cemented gate, the left-end of the said inter-connected
culverts again connected by defendant to a big hole or opening
thru the lower portion of the same concrete hollowblocks fence on
the left side of the said cemented gate, which hole or opening is
likewise connected by defendant to the cemented mouth of a big
canal, also constructed by defendant, which runs northward
towards a big hole or opening which was also built by defendant
thru the lower portion of its concrete hollow-blocks fence which
separates the land of plaintiffs from that of defendant (and which
serves as the exit-point of the floodwater coming from the land of
defendant, and at the same time, the entrance-point of the same
floodwater to the land of plaintiffs, year after year, during rainy or
stormy seasons.
5) That moreover, on the middle-left portion of its land just beside
the land of plaintiffs, defendant also constructed an artificial lake,
the base of which is soil, which utilizes the water being channeled
thereto from its water system thru inter-connected galvanized iron
pipes (No. 2) and complimented by rain water during rainy or
stormy seasons, so much so that the water below it seeps into,
and the excess water above it inundates, portions of the adjoining
land of plaintiffs.
6) That as a result of the inundation brought about by defendant's
aforementioned water conductors, contrivances and manipulators,
a young man was drowned to death, while herein plaintiffs
suffered and will continue to suffer, as follows:
3
a) Portions of the land of plaintiffs were eroded and converted to
deep, wide and long canals, such that the same can no longer be
planted to any crop or plant.
b) Costly fences constructed by plaintiffs were, on several
occasions, washed away.
c) During rainy and stormy seasons the lives of plaintiffs and their
laborers are always in danger.
d) Plants and other improvements on other portions of the land of
plaintiffs are exposed to destruction. ... 10
A careful examination of the aforequoted complaint shows that the
civil action is one under Articles 2176 and 2177 of the Civil Code
on quasi-delicts. All the elements of a quasi-delict are present, to
wit: (a) damages suffered by the plaintiff, (b) fault or negligence of
the defendant, or some other person for whose acts he must
respond; and (c) the connection of cause and effect between the
fault or negligence of the defendant and the damages incurred by
the plaintiff. 11
Clearly, from petitioner's complaint, the waterpaths and
contrivances built by respondent corporation are alleged to have
inundated the land of petitioners. There is therefore, an assertion
of a causal connection between the act of building these
waterpaths and the damage sustained by petitioners. Such action
if proven constitutes fault or negligence which may be the basis
for the recovery of damages.
In the case of Samson vs. Dionisio, 12 the Court applied Article
1902, now Article 2176 of the Civil Code and held that "any person
who without due authority constructs a bank or dike, stopping the
flow or communication between a creek or a lake and a river,
thereby causing loss and damages to a third party who, like the
rest of the residents, is entitled to the use and enjoyment of the
stream or lake, shall be liable to the payment of an indemnity for
loss and damages to the injured party.
While the property involved in the cited case belonged to the
public domain and the property subject of the instant case is
privately owned, the fact remains that petitioners' complaint
sufficiently alleges that petitioners have sustained and will
continue to sustain damage due to the waterpaths and
contrivances built by respondent corporation. Indeed, the recitals
of the complaint, the alleged presence of damage to the
petitioners, the act or omission of respondent corporation
supposedly constituting fault or negligence, and the causal
connection between the act and the damage, with no pre-existing
contractual obligation between the parties make a clear case of
a quasi delict or culpa aquiliana.
It must be stressed that the use of one's property is not
without limitations. Article 431 of the Civil Code provides that
"the owner of a thing cannot make use thereof in such a
manner as to injure the rights of a third person." SIC UTERE
TUO UT ALIENUM NON LAEDAS. Moreover, adjoining
landowners have mutual and reciprocal duties which require
that each must use his own land in a reasonable manner so as
not to infringe upon the rights and interests of others. Although
we recognize the right of an owner to build structures on his
land, such structures must be so constructed and maintained
using all reasonable care so that they cannot be dangerous to
adjoining landowners and can withstand the usual and
expected forces of nature. If the structures cause injury or
damage to an adjoining landowner or a third person, the latter
can claim indemnification for the injury or damage suffered.
Article 2176 of the Civil Code imposes a civil liability on a
person for damage caused by his act or omission constituting
fault or negligence, thus:
Article 2176. Whoever by act or omission causes damage to
another, there being fault or negligence, is obliged to pay for
the damage done. Such fault or negligence, if there is no pre-
existing contractual relation between the parties, is called a
quasi-delict and is governed by the provisions of this chapter.
Article 2176, whenever it refers to "fault or negligence", covers
not only acts "not punishable by law" but also acts criminal in
character, whether intentional and voluntary or negligent.
Consequently, a separate civil action lies against the offender
in a criminal act, whether or not he is criminally prosecuted
and found guilty or acquitted, provided that the offended party
is not allowed, (if the tortfeasor is actually charged also
criminally), to recover damages on both scores, and would be
entitled in such eventuality only to the bigger award of the two,
assuming the awards made in the two cases vary. 13
The distinctness of quasi-delicta is shown in Article 2177 of the
Civil Code, which states:
Article 2177. Responsibility for fault or negligence under the
preceding article is entirely separate and distinct from the civil
liability arising from negligence under the Penal Code. But the
plaintiff cannot recover damages twice for the same act or
omission of the defendant.
According to the Report of the Code Commission "the
foregoing provision though at first sight startling, is not so
novel or extraordinary when we consider the exact nature of
criminal and civil negligence. The former is a violation of the
criminal law, while the latter is a distinct and independent
negligence, which is a "culpa aquiliana" or quasi-delict, of
ancient origin, having always had its own foundation and
individuality, separate from criminal negligence. Such distinction
between criminal negligence and "culpa extra-contractual" or
"cuasi-delito" has been sustained by decisions of the Supreme
Court of Spain ... 14
In the case of Castillo vs. Court of Appeals, 15 this Court held that
a quasi-delict or culpa aquiliana is a separate legal institution
under the Civil Code with a substantivity all its own, and
individuality that is entirely apart and independent from a delict or
crime a distinction exists between the civil liability arising from
a crime and the responsibility for quasi-delicts or culpa extra-
contractual. The same negligence causing damages may produce
civil liability arising from a crime under the Penal Code, or create
an action for quasi-delicts or culpa extra-contractual under the
Civil Code. Therefore, the acquittal or conviction in the criminal
case is entirely irrelevant in the civil case, unless, of course, in the
event of an acquittal where the court has declared that the fact
from which the civil action arose did not exist, in which case the
extinction of the criminal liability would carry with it the extinction
of the civil liability.
In Azucena vs. Potenciano, 16 the Court declared that in quasi-
delicts, "(t)he civil action is entirely independent of the criminal
case according to Articles 33 and 2177 of the Civil Code. There
can be no logical conclusion than this, for to subordinate the civil
action contemplated in the said articles to the result of the criminal
prosecution whether it be conviction or acquittal would
render meaningless the independent character of the civil action
and the clear injunction in Article 31, that his action may proceed
independently of the criminal proceedings and regardless of the
result of the latter."
WHEREFORE, the assailed decision dated February 17, 1986 of
the then Intermediate Appellate Court affirming the order of
dismissal of the Regional Trial Court of Cavite, Branch 18
(Tagaytay City) dated August 17, 1984 is hereby REVERSED and
SET ASIDE. The trial court is ordered to reinstate Civil Case No.
TG-748 entitled "Natividad V. Andamo and Emmanuel R. Andamo
vs. Missionaries of Our Lady of La Salette Inc." and to proceed
with the hearing of the case with dispatch. This decision is
immediately executory. Costs against respondent corporation.
SO ORDERED.
2. FAULT OR NEGLIGENCE
G.R. No. L-7567 November 12, 1912
THE UNITED STATES, plaintiff-appellee, vs. SEGUNDO
BARIAS, defendant-appellant.
CARSON, J.:
4
This is an appeal from a sentence imposed by the Honorable A. S.
Crossfield, judge of the Court of First Instance of Manila, for
homicide resulting from reckless negligence. The information
charges:
That on or about November 2, 1911, in the city of Manila,
Philippine Islands, the said Segundo Barias was a motorman on
street car No. 9, run 7 of the Pasay-Cervantes lines of the Manila
Electric Railroad and Light Company, a corporation duly organized
and doing business in the city of Manila, Philippine Islands; as a
such motorman he was controlling and operating said street car
along Rizal Avenue, formerly Calle Cervantes, of this city, and as
such motorman of the said street car he was under obligation to
run the same with due care and diligence to avoid any accident
that might occur to vehicles and pedestrians who were travelling
on said Rizal Avenue; said accused, at said time and place, did
willfully, with reckless imprudence and inexcusable negligence
and in violation of the regulations promulgated to that effect,
control and operate said street car, without heeding the
pedestrians crossing Rizal Avenue from one side to the other, thus
knocking down and causing by his carelessness and imprudent
negligence that said street car No. 9, operated and controlled by
said accused, as hereinbefore stated, should knock down and
pass over the body and head of one Fermina Jose, a girl 2 years
old, who at said time and place was crossing the said Rizal
Avenue, the body of said girl being dragged along street-car on
said Rizal Avenue for a long distance, thus crushing and
destroying her head and causing her sudden death as a result of
the injury received; that if the acts executed by the accused had
been done with malice, he would be guilty of the serious crime of
homicide.
The defendant was a motorman for the Manila Electric Railroad
and Light Company. At about 6 o'clock on the morning of
November 2, 1911, he was driving his car along Rizal avenue and
stopped it near the intersection of that street with Calle Requesen
to take on some passengers. When the car stopped, the
defendant looked backward, presumably to note whether all the
passengers were aboard, and then started his car. At that moment
Fermina Jose, a child about 3 years old, walked or ran in front of
he car. She was knocked down and dragged some little distance
underneath the car, and was left dead upon the track. The
motorman proceeded with his car to the end of the track, some
distance from the place of the accident, and apparently knew
nothing of it until his return, when he was informed of what
happened.
There is no substantial dispute as to the facts. It is true that one
witness testified that the defendant started the car without turning
his head, and while he was still looking backwards and that this
testimony was directly contradicted by that of another witness. But
we do not deem it necessary to make an express finding as to
the precise direction in which the defendant's head was turned
at the moment when he started his car. It is sufficient for the
purpose of our decision to hold, as we do, that the evidence
clearly discloses that he started his car from a standstill
without looking over the track immediately in front of the car to
satisfy himself that it was clear. he did not see the child until
after he had run his car over it, and after he had return to the
place where it was found dead, and we think we are justified in
saying that whenever he was looking at the moment when he
started his car, he was not looking at the track immediately in
front of the car, and that he had not satisfied himself that this
portion of the tract was clear immediately before putting the
car in the motion.
The trial court found the defendant guilty of imprudencia
temeraria (reckless negligence) as charged in the information,
and sentenced him to over one year and one month of
imprisonment in the Bilibid Prison, and to pay the cause of the
action.
The sole question raised by this appeal is whether the
evidence shows such carelessness or want of ordinary care
on the part of the defendant as to amount to reckless
negligence (imprudencia temeraria).
Judge Cooley in his work on Torts (3d ed., 1324) defines
negligence to be: "The failure to observe, for the protection of
the interests of another person, that degree of care,
precaution and vigilance which the circumstances justly
demand, whereby such other persons suffers injury."
In the case of U. S. vs. Nava, (1 Phil. Rep., 580), we held that:
"Reckless negligence consists of the failure to take such
precautions or advance measures in the performance of an
act as the most prudence would suggest whereby injury is
caused to persons or to property."
Silvela says in his "Derecho Penal," in speaking of reckless
imprudence (imprudencia temeraria):
The word "negligencia" used in the code, and the
term "imprudencia" with which this punishable act is defined,
express this idea in such a clear manner that it is not
necessary to enlarge upon it. He who has done everything on
his part to prevent his actions from causing damage to
another, although he has not succeeded in doing so,
notwithstanding his efforts, is the victim of an accident and can
not be considered responsible for the same. (Vol. 2, p. 127
[153].)
Temerario is, in our opinion, one who omits, with regard to this
actions, which are liable to cause injury to another, that care
and diligence, that attention, which can be required of the least
careful, attentive, or diligent. If a moment's attention and reflection
would have shown a person that the act which he was about to
perform was liable to have the harmful consequence which it had,
such person acted with temerity and may be guilty of
"imprudencia temeraria." It may be that in practice this idea has
been given a greater scope and the acts of imprudence which did
not show carelessness as carried to such high degree, might have
been punished as "imprudencia temeraria;" but in our opinion, the
proper meaning of the word does not authorize another
interpretation. (Id., p. 133 [161].)
Groizard, commenting upon "imprudencia temeraria," on page
389, volume 8, of his work on the Penal Code, says:
Prudence is that cardinal virtue which teaches us to discern and
distinguish the good from bad, in order to adopt or flee from it. It
also means good judgment, temperance, and moderation in one's
actions. `Temerario is one who exposes himself to danger or
rushes into it without reflection and without examining the same.
Consequently, he who from lack of good judgment, temperance,
or moderation in his actions, exposes himself without reflection
and examination to the danger of committing a crime, must be
held responsible under the provision of law aforementioned.
Negligence is want of the care required by the circumstances. It is
a relative or comparative, not an absolute, term and its application
depends upon the situation of the parties and the degree of care
and vigilance which the circumstances reasonably require. Where
the danger is great, a high degree of care is necessary, and the
failure to observe it is a want of ordinary care under the
circumstances. (Ahern vs. Oregon Telephone Co., 24 Oreg., 276,
294; 35 Pac., 549.)
Ordinary care, if the danger is great, may arise to the grade of a
very exact and unchangeable attention. (Parry Mfg. Co. vs. Eaton,
41 Ind. App., 81, 1908; 83 N. E., 510.)
In the case of U. S. vs. Reyes (1 Phil. Rep., 375-377), we held
that: "The diligence with which the law requires the individual at all
the time to govern his conduct varies with the nature of the
situation in which he is placed and with the importance of the act
which he is to perform.lawph!l.net
The question to be determined then, is whether, under all the
circumstances, and having in mind the situation of the defendant
when he put his car in motion and ran it over the child, he was
guilty of a failure to take such precautions or advance measures
as common prudence would suggest.
The evidence shows that the thoroughfare on which the incident
occurred was a public street in a densely populated section of the
city. The hour was six in the morning, or about the time when the
5
residents of such streets begin to move about. Under such
conditions a motorman of an electric street car was clearly
charged with a high degree of diligence in the performance of his
duties. He was bound to know and to recognize that any
negligence on his part in observing the track over which he was
running his car might result in fatal accidents. He had no right to
assume that the track before his car was clear. It was his duty to
satisfy himself of that fact by keeping a sharp lookout, and to do
everything in his power to avoid the danger which is necessarily
incident to the operation of heavy street cars on public
thoroughfares in populous sections of the city.
Did he exercise the degree of diligence required of him? We think
this question must be answered in the negative. We do not go so
far as to say that having brought his car to a standstill it was his
bounden duty to keep his eyes directed to the front. Indeed, in the
absence of some regulation of his employers, we can well
understand that, at times, it might be highly proper and prudent for
him to glance back before again setting his car in motion, to
satisfy himself that he understood correctly a signal to go forward
or that all the passengers had safely alighted or gotten on board.
But we do insist that before setting his car again in motion, it was
his duty to satisfy himself that the track was clear, and, for that
purpose, to look and to see the track just in front of his car. This
the defendant did not do, and the result of his negligence was the
death of the child.
In the case of Smith vs. St. Paul City Ry. Co., (32 Minn., p. 1), the
supreme court of Minnesota, in discussing the diligence required
of street railway companies in the conduct of their business
observed that: "The defendant was a carrier of passengers for
hire, owing and controlling the tracks and cars operated thereon. It
is therefore subject to the rules applicable to passenger carriers.
(Thompson's Carriers, 442; Barrett vs. Third Ave. R. Co., 1
Sweeny, 568; 8 Abb. Pr. (N.S.), 205.) As respects hazards and
dangers incident to the business or employment, the law enjoins
upon such carrier the highest degree of care consistent with its
undertaking, and it is responsible for the slightest negligence.
(Wilson vs. Northern Pacific R. Co., 26 Minn., 278; Warren vs.
Fitchburg R. Co., 8 Allen, 233; 43 Am. Dec. 354, 356, notes and
cases.) . . . The severe ruled which enjoins upon the carrier such
extraordinary care and diligence, is intended, for reasons of public
policy, to secure the safe carriage of passengers, in so far as
human skill and foresight can affect such result." The case just
cited was a civil case, and the doctrine therein announced had
special reference to the care which should be exercised in
securing the safety of passengers. But we hold that the reasons of
public policy which impose upon street car companies and their
employees the duty of exercising the utmost degree of diligence in
securing the safety of passengers, apply with equal force to the
duty of avoiding the infliction of injuries upon pedestrians and
others on the public streets and thoroughfares over which
these companies are authorized to run their cars. And while, in
a criminal case, the courts will require proof of the guilt of the
company or its employees beyond a reasonable doubt,
nevertheless the care or diligence required of the company
and its employees is the same in both cases, and the only
question to be determined is whether the proofs shows
beyond a reasonable doubt that the failure to exercise such
care or diligence was the cause of the accident, and that the
defendant was guilty thereof.
Counsel for the defendant insist that the accident might have
happened despite the exercise of the utmost care by the
defendant, and they have introduced photographs into the
record for the purpose of proving that while the motorman was
standing in his proper place on the front platform of the car, a
child might have walked up immediately in front of he car
without coming within the line of his vision. Examining the
photographs, we think that this contention may have some
foundation in fact; but only to this extent, that standing erect,
at the position he would ordinarily assume while the car is in
motion, the eye of the average motorman might just miss
seeing the top of the head of a child, about three years old,
standing or walking close up to the front of the car. But it is
also very evident that by inclining the head and shoulders
forward very slightly, and glancing in front of the car, a person
in the position of a motorman could not fail to see a child on
the track immediately in front of his car; and we hold that it is
the manifest duty of a motorman, who is about to start his car
on a public thoroughfare in a thickly-settled district, to satisfy
himself that the track is clear immediately in front of his car,
and to incline his body slightly forward, if that be necessary, in
order to bring the whole track within his line of vision. Of
course, this may not be, and usually is not necessary when
the car is in motion, but we think that it is required by the
dictates of the most ordinary prudence in starting from a
standstill.
We are not unmindful of our remarks in the case of U. S. vs.
Bacho (10 Phil. Rep., 577), to which our attention is directed
by counsel for appellant. In that case we said that:
. . . In the general experience of mankind, accidents
apparently avoidable and often inexplicable are unfortunately
too frequent to permit us to conclude that some one must be
criminally liable for negligence in every case where an
accident occurs. It is the duty of the prosecution in each case
to prove by competent evidence not only the existence of
criminal negligence, but that the accused was guilty thereof.
Nor do we overlook the ruling in the case of U. S. vs. Barnes
(12 Phil. Rep., 93), to which our attention is also invited,
wherein we held that the defendant was not guilty of reckless
negligence, where it appeared that he killed another by the
discharge of his gun under such circumstances that he might
have been held guilty of criminally reckless negligence had he
had knowledge at that moment that another person was in such
position as to be in danger if the gun should be discharged. In this
latter case the defendant had no reason to anticipate that the
person who was injured was in the line of fire, or that there was
any probability that he or anyone else would place himself in the
line of fire. In the case at bar, however, it was, as we have seen,
the manifest duty of the motorman to take reasonable precautions
in starting his car to see that in doing so he was not endangering
the life of any pedestrian, old or young; and to this end it was
further his duty to guard against the reasonable possibility that
some one might be on the track immediately in front of the car.
We think that the evidence showing, as it does, that the child was
killed at the moment when the car was set in motion, we are
justified in holding that, had the motorman seen the child, he
could have avoided the accident; the accident was not, therefore,
"unavailable or inexplicable," and it appearing that the motorman,
by the exercise of ordinary diligence, might have seen the child
before he set the car in motion, his failure to satisfy himself that
the track was clear before doing so was reckless negligence, of
which he was properly convicted in the court below.
We think, however, that the penalty should be reduced to that of
six months and one day of prision correccional. Modified by
substituting for so much thereof as imposes the penalty of one
year and one month of imprisonment, the penalty of six months
and one day of prision correccional, the judgment of the lower
court convicting and sentencing the appellant is affirmed, with
costs of both instances against him. So ordered.
G.R. No. L-44264 September 19, 1988
HEDY GAN y YU, petitioner, vs. THE HONORABLE COURT OF
APPEALS and the PEOPLE OF THE
PHILIPPINES, respondents.
FERNAN, C.J.:
Petitioner Hedy Gan was convicted of the crime of Homicide thru
Reckless Imprudence in Criminal Case No. 10201 of the then
Court of First Instance of Manila, Branch XXII presided by Judge
Federico C. Alikpala. She was sentenced to an indeterminate
penalty of four (4) months and one (1) day of arresto mayor as
minimum and two (2) years, four (4) months and one (1) day
of prision correccional as maximum and was made to indemnify
the heirs of the victim the sum of P12,000.00 without any
subsidiary imprisonment in case of insolvency and to pay the
costs. On appeal, the trial court's decision was modified and
petitioner was convicted only of Homicide thru Simple
6
Imprudence. Still unsatisfied with the decision of the Court of
Appeals,1 petitioner has come to this Court for a complete reversal
of the judgment below.
The facts of the case as found by the appellate court are as
follows:
In the morning of July 4, 1972 at about 8:00 o'clock, the accused
Hedy Gan was driving a Toyota car along North Bay Boulevard,
Tondo, Manila. While in front of house no. 694 of North Bay
Boulevard, there were two vehicles, a truck and a jeepney parked
on one side of the road, one following the other about two to three
meters from each other. As the car driven by the accused
approached the place where the two vehicles were parked, there
was a vehicle coming from the opposite direction, followed by
another which tried to overtake and bypass the one in front of it
and thereby encroached the lane of the car driven by the accused.
To avoid a head-on collision with the oncoming vehicle, the
defendant swerved to the right and as a consequence, the front
bumper of the Toyota Crown Sedan hit an old man who was about
to cross the boulevard from south to north, pinning him against the
rear of the parked jeepney. The force of the impact caused the
parked jeepney to move forward hitting the rear of the parts truck
ahead of it. The pedestrian was injured, the Toyota Sedan was
damaged on its front, the jeep suffered damages on its rear and
front paints, and the truck sustained scratches at the wooden
portion of its rear. The body of the old man who was later
Identified as Isidoro Casino was immediately brought to the Jose
Reyes Memorial Hospital but was (pronounced) dead on arrival.2
An information for Homicide thru Reckless Imprudence was filed
against petitioner in view of the above incident. She entered a
plea of not guilty upon arraignment and the case was set for trial.
Meanwhile, petitioner sought and was granted a re-investigation
by the City Fiscal, as a result of which the trial fiscal moved for the
dismissal of the case against petitioner during the resumption of
hearing on September 7, 1972. The grounds cited therefor were
lack of interest on the part of the complaining witness to prosecute
the case as evidenced by an affidavit of desistance submitted to
the trial court and lack of eyewitness to sustain the charge.
The motion to dismiss filed by the fiscal was never resolved. The
Court instead ordered the prosecution to present its evidence.
After the prosecution rested its case, the petitioner filed a motion
to dismiss the case on the ground of insufficiency of evidence.
On December 22, 1972, the trial court rendered judgment finding
petitioner guilty beyond reasonable doubt of the of- offense
charged.
Petitioner appealed to the Court of Appeals in CA-G.R. No.
14472-CR. On May 3, 1976, the Court of Appeals rendered a
decision, the dispositive portion of which reads as follows:
Wherefore, as modified, the accused Hedy Gan is guilty
beyond reasonable doubt of the crime of homicide thru simple
imprudence and, pursuant to paragraph 2, Article 365 of the
Revised Penal Code, she is hereby sentenced to the
indeterminate penalty of three (3) months and eleven (11)
days of arresto mayor and to indemnify the heirs of Isidoro
Casino in the sum of Twelve Thousand Pesos (Pl2,000.00)
without, however, any subsidiary imprisonment in case of
insolvency, and to pay the costs. 3
Petitioner now appeals to this Court on the following
assignments of errors:
I react to the situation she was in. For it is undeniable that the
The Court of Appeals erred in holding that when the petitioner
saw a car travelling directly towards her, she should have
stepped on the brakes immediately or in swerving her vehicle
to the right should have also stepped on the brakes or
lessened her speed, to avoid the death of a pedestrian.
II
The Court of Appeals erred in convicting the petitioner of the
crime of Homicide thru Simple Imprudence.
III
The Court of Appeals erred in adjudging the petitioner liable to
indemnify the deceased in the sum of P12,000.00.4
We reverse.
The test for determining whether or not a person is negligent
in doing an act whereby injury or damage results to the person
or property of another is this: Would a prudent man in the
position of the person to whom negligence is attributed
foresee harm to the person injured as a reasonable
consequence of the course about to be pursued? If so, the law
imposes the duty oil the doer to take precaution against its
mischievous results and the failure to do so constitutes
negligence. 5
A corollary rule is what is known in the law as the emergency
rule. "Under that rule, one who suddenly finds himself in a
place of danger, and is required to act without time to consider
the best means that may be adopted to avoid the impending
danger, is not guilty of negligence, if he fails to adopt what
subsequently and upon reflection may appear to have been a
better method, unless the emergency in which he finds himself
is brought about by his own negligence." 6
Applying the above test to the case at bar, we find the petitioner
not guilty of the crime of Simple Imprudence resulting in
Homicide.
The appellate court in finding the petitioner guilty said:
The accused should have stepped on the brakes when she saw
the car going in the opposite direction followed by another which
overtook the first by passing towards its left. She should not only
have swerved the car she was driving to the right but should have
also tried to stop or lessen her speed so that she would not bump
into the pedestrian who was crossing at the time but also the
jeepney which was then parked along the street. 7
The course of action suggested by the appellate court would
seem reasonable were it not for the fact that such suggestion did
not take into account the amount of time afforded petitioner to
suggested course of action presupposes sufficient time for
appellant to analyze the situation confronting her and to ponder
on which of the different courses of action would result in the least
possible harm to herself and to others.
Due to the lack of eyewitnesses, no evidence was presented by
the prosecution with respect to the relative distances of petitioner
to the parked jeepney and the oncoming overtaking vehicle that
would tend to prove that petitioner did have sufficient time to
reflect on the consequences of her instant decision to swerve her
car to the light without stepping on her brakes. In fact, the
evidence presented by the prosecution on this point is the
petitioner's statement to the police 8 stating::
And masasabi ko lang ho umiwas ho ako sa isang sasakyan
na biglang nagovertake sa sasakyan na aking kasalubong kung
kaya ay aking kinabig sa kanan ang akin kotse subalit siya
naman biglangpagtawid ng tao o victim at hindi ko na ho
naiwasan at ako ay wala ng magawa . Iyan ho ang buong
pangyayari nang nasabing aksidente.9 (Emphasis supplied)
The prosecution having presented this exhibit as its own
evidence, we cannot but deem its veracity to have been admitted
by it. Thus, under the circumstances narrated by petitioner, we
find that the appellate court is asking too much from a mere
mortal like the petitioner who in the blink of an eye had to exercise
her best judgment to extricate herself from a difficult and
dangerous situation caused by the driver of the overtaking
vehicle. Petitioner certainly could not be expected to act with all
the coolness of a person under normal conditions. 10 The danger
confronting petitioner was real and imminent, threatening her very
existence. She had no opportunity for rational thinking but only
enough time to heed the very powerfull instinct of self-
preservation.
7
Also, the respondent court itself pronounced that the petitioner
was driving her car within the legal limits. We therefore rule that
the "emergency rule" enunciated above applies with full force to
the case at bar and consequently absolve petitioner from any
criminal negligence in connection with the incident under
consideration.
We further set aside the award of damages to the heirs of the
victim, who by executing a release of the claim due them, had
effectively and clearly waived their right thereto.
WHEREFORE, judgment is hereby rendered acquitting petitioner
HEDY GAN y YU of the crime of Homicide thru Simple
Imprudence. She is no longer liable for the P12,000.00 civil
indemnity awarded by the appellate court to the heirs of the victim.
SO ORDERED.
G.R. No. L-12219 March 15, 1918
AMADO PICART, plaintiff-appellant, vs. FRANK SMITH,
JR., defendant-appellee.
STREET, J.:
In this action the plaintiff, Amado Picart, seeks to recover of the
defendant, Frank Smith, jr., the sum of P31,000, as damages
alleged to have been caused by an automobile driven by the
defendant. From a judgment of the Court of First Instance of the
Province of La Union absolving the defendant from liability the
plaintiff has appealed.
The occurrence which gave rise to the institution of this action
took place on December 12, 1912, on the Carlatan Bridge, at San
Fernando, La Union. It appears that upon the occasion in question
the plaintiff was riding on his pony over said bridge. Before he had
gotten half way across, the defendant approached from the
opposite direction in an automobile, going at the rate of about ten
or twelve miles per hour. As the defendant neared the bridge he
saw a horseman on it and blew his horn to give warning of his
approach. He continued his course and after he had taken the
bridge he gave two more successive blasts, as it appeared to him
that the man on horseback before him was not observing the rule
of the road.
The plaintiff, it appears, saw the automobile coming and heard the
warning signals. However, being perturbed by the novelty of the
apparition or the rapidity of the approach, he pulled the pony
closely up against the railing on the right side of the bridge instead
of going to the left. He says that the reason he did this was that he
thought he did not have sufficient time to get over to the other
side. The bridge is shown to have a length of about 75 meters and
a width of 4.80 meters. As the automobile approached, the
defendant guided it toward his left, that being the proper side
of the road for the machine. In so doing the defendant
assumed that the horseman would move to the other side. The
pony had not as yet exhibited fright, and the rider had made
no sign for the automobile to stop. Seeing that the pony was
apparently quiet, the defendant, instead of veering to the right
while yet some distance away or slowing down, continued to
approach directly toward the horse without diminution of
speed. When he had gotten quite near, there being then no
possibility of the horse getting across to the other side, the
defendant quickly turned his car sufficiently to the right to
escape hitting the horse alongside of the railing where it as
then standing; but in so doing the automobile passed in such
close proximity to the animal that it became frightened and
turned its body across the bridge with its head toward the
railing. In so doing, it as struck on the hock of the left hind leg
by the flange of the car and the limb was broken. The horse
fell and its rider was thrown off with some violence. From the
evidence adduced in the case we believe that when the
accident occurred the free space where the pony stood
between the automobile and the railing of the bridge was
probably less than one and one half meters. As a result of its
injuries the horse died. The plaintiff received contusions which
caused temporary unconsciousness and required medical
attention for several days.
The question presented for decision is whether or not the
defendant in maneuvering his car in the manner above
described was guilty of negligence such as gives rise to a civil
obligation to repair the damage done; and we are of the
opinion that he is so liable. As the defendant started across
the bridge, he had the right to assume that the horse and the
rider would pass over to the proper side; but as he moved
toward the center of the bridge it was demonstrated to his
eyes that this would not be done; and he must in a moment
have perceived that it was too late for the horse to cross with
safety in front of the moving vehicle. In the nature of things this
change of situation occurred while the automobile was yet
some distance away; and from this moment it was not longer
within the power of the plaintiff to escape being run down by
going to a place of greater safety. The control of the situation
had then passed entirely to the defendant; and it was his duty
either to bring his car to an immediate stop or, seeing that
there were no other persons on the bridge, to take the other
side and pass sufficiently far away from the horse to avoid the
danger of collision. Instead of doing this, the defendant ran
straight on until he was almost upon the horse. He was, we
think, deceived into doing this by the fact that the horse had
not yet exhibited fright. But in view of the known nature of
horses, there was an appreciable risk that, if the animal in
question was unacquainted with automobiles, he might get exited
and jump under the conditions which here confronted him. When
the defendant exposed the horse and rider to this danger he was,
in our opinion, negligent in the eye of the law.
The test by which to determine the existence of negligence in a
particular case may be stated as follows: Did the defendant in
doing the alleged negligent act use that person would have used
in the same situation? If not, then he is guilty of negligence. The
law here in effect adopts the standard supposed to be supplied by
the imaginary conduct of the discreet paterfamilias of the Roman
law. The existence of negligence in a given case is not determined
by reference to the personal judgment of the actor in the situation
before him. The law considers what would be reckless,
blameworthy, or negligent in the man of ordinary intelligence and
prudence and determines liability by that.
The question as to what would constitute the conduct of a prudent
man in a given situation must of course be always determined in
the light of human experience and in view of the facts involved in
the particular case. Abstract speculations cannot here be of much
value but this much can be profitably said: Reasonable men
govern their conduct by the circumstances which are before them
or known to them. They are not, and are not supposed to be,
omniscient of the future. Hence they can be expected to take care
only when there is something before them to suggest or warn of
danger. Could a prudent man, in the case under consideration,
foresee harm as a result of the course actually pursued? If so, it
was the duty of the actor to take precautions to guard against that
harm. Reasonable foresight of harm, followed by ignoring of the
suggestion born of this prevision, is always necessary before
negligence can be held to exist. Stated in these terms, the proper
criterion for determining the existence of negligence in a given
case is this: Conduct is said to be negligent when a prudent man
in the position of the tortfeasor would have foreseen that an effect
harmful to another was sufficiently probable to warrant his
foregoing conduct or guarding against its consequences.
Applying this test to the conduct of the defendant in the present
case we think that negligence is clearly established. A prudent
man, placed in the position of the defendant, would in our opinion,
have recognized that the course which he was pursuing was
fraught with risk, and would therefore have foreseen harm to the
horse and the rider as reasonable consequence of that course.
Under these circumstances the law imposed on the defendant the
duty to guard against the threatened harm.
It goes without saying that the plaintiff himself was not free from
fault, for he was guilty of antecedent negligence in planting
himself on the wrong side of the road. But as we have already
stated, the defendant was also negligent; and in such case the
8
problem always is to discover which agent is immediately and
directly responsible. It will be noted that the negligent acts of the
two parties were not contemporaneous, since the negligence of
the defendant succeeded the negligence of the plaintiff by an
appreciable interval. Under these circumstances the law is that the
person who has the last fair chance to avoid the impending harm
and fails to do so is chargeable with the consequences, without
reference to the prior negligence of the other party.
The decision in the case of Rkes vs. Atlantic, Gulf and Pacific Co.
(7 Phil. Rep., 359) should perhaps be mentioned in this
connection. This Court there held that while contributory
negligence on the part of the person injured did not constitute a
bar to recovery, it could be received in evidence to reduce the
damages which would otherwise have been assessed wholly
against the other party. The defendant company had there
employed the plaintiff, as a laborer, to assist in transporting iron
rails from a barge in Manila harbor to the company's yards located
not far away. The rails were conveyed upon cars which were
hauled along a narrow track. At certain spot near the water's edge
the track gave way by reason of the combined effect of the weight
of the car and the insecurity of the road bed. The car was in
consequence upset; the rails slid off; and the plaintiff's leg was
caught and broken. It appeared in evidence that the accident was
due to the effects of the typhoon which had dislodged one of the
supports of the track. The court found that the defendant company
was negligent in having failed to repair the bed of the track and
also that the plaintiff was, at the moment of the accident, guilty of
contributory negligence in walking at the side of the car instead of
being in front or behind. It was held that while the defendant was
liable to the plaintiff by reason of its negligence in having failed to
keep the track in proper repair nevertheless the amount of the
damages should be reduced on account of the contributory
negligence in the plaintiff. As will be seen the defendant's
negligence in that case consisted in an omission only. The liability
of the company arose from its responsibility for the dangerous
condition of its track. In a case like the one now before us, where
the defendant was actually present and operating the automobile
which caused the damage, we do not feel constrained to attempt
to weigh the negligence of the respective parties in order to
apportion the damage according to the degree of their relative
fault. It is enough to say that the negligence of the defendant was
in this case the immediate and determining cause of the accident
and that the antecedent negligence of the plaintiff was a more
remote factor in the case.
A point of minor importance in the case is indicated in the special
defense pleaded in the defendant's answer, to the effect that the
subject matter of the action had been previously adjudicated in the
court of a justice of the peace. In this connection it appears that
soon after the accident in question occurred, the plaintiff caused
criminal proceedings to be instituted before a justice of the
peace charging the defendant with the infliction of serious
injuries (lesiones graves). At the preliminary investigation the
defendant was discharged by the magistrate and the
proceedings were dismissed. Conceding that the acquittal of
the defendant at the trial upon the merits in a criminal
prosecution for the offense mentioned would be res adjudicata
upon the question of his civil liability arising from negligence --
a point upon which it is unnecessary to express an opinion --
the action of the justice of the peace in dismissing the criminal
proceeding upon the preliminary hearing can have no effect.
(See U. S. vs. Banzuela and Banzuela, 31 Phil. Rep., 564.)
From what has been said it results that the judgment of the
lower court must be reversed, and judgment is her rendered
that the plaintiff recover of the defendant the sum of two
hundred pesos (P200), with costs of other instances. The sum
here awarded is estimated to include the value of the horse,
medical expenses of the plaintiff, the loss or damage
occasioned to articles of his apparel, and lawful interest on the
whole to the date of this recovery. The other damages claimed
by the plaintiff are remote or otherwise of such character as
not to be recoverable. So ordered.
Arellano, C.J., Torres, Carson, Araullo, Avancea, and Fisher,
JJ., concur.
Johnson, J., reserves his vote.
Separate Opinions
MALCOLM, J., concurring:
After mature deliberation, I have finally decided to concur with
the judgment in this case. I do so because of my
understanding of the "last clear chance" rule of the law of
negligence as particularly applied to automobile accidents.
This rule cannot be invoked where the negligence of the
plaintiff is concurrent with that of the defendant. Again, if a
traveler when he reaches the point of collision is in a situation
to extricate himself and avoid injury, his negligence at that
point will prevent a recovery. But Justice Street finds as a fact
that the negligent act of the interval of time, and that at the
moment the plaintiff had no opportunity to avoid the accident.
Consequently, the "last clear chance" rule is applicable. In
other words, when a traveler has reached a point where he
cannot extricate himself and vigilance on his part will not avert
the injury, his negligence in reaching that position becomes
the condition and not the proximate cause of the injury and will
not preclude a recovery. (Note especially Aiken vs. Metcalf
[1917], 102 Atl., 330.)
3. DAMAGES
G.R. No. 120554 September 21, 1999
SO PING BUN, petitioner, vs.COURT OF APPEALS, TEK HUA
ENTERPRISES CORP. and MANUEL C. TIONG, respondents.
QUISUMBING, J.:
This petition for certiorari challenges the Decision 1 of the Court of
Appeals dated October 10, 1994, and the Resolution 2 dated June
5, 1995, in CA-G.R. CV No. 38784. The appellate court affirmed
the decision of the Regional Trial Court of Manila, Branch 35,
except for the award of attorney's fees, as follows:
WHEREFORE, foregoing considered, the appeal of respondent-
appellant So Ping Bun for lack of merit is DISMISSED. The
appealed decision dated April 20, 1992 of the court a quo is
modified by reducing the attorney's fees awarded to plaintiff Tek
Hua Enterprising Corporation from P500,000.00 to P200,000.00. 3
The facts are as follows:
In 1963, Tek Hua Trading Co, through its managing partner, So
Pek Giok, entered into lease agreements with lessor Dee C.
Chuan & Sons Inc. (DCCSI). Subjects of four (4) lease contracts
were premises located at Nos. 930, 930-Int., 924-B and 924-C,
Soler Street, Binondo, Manila. Tek Hua used the areas to store its
textiles. The contracts each had a one-year term. They provided
that should the lessee continue to occupy the premises after the
term, the lease shall be on a month-to-month basis.
When the contracts expired, the parties did not renew the
contracts, but Tek Hua continued to occupy the premises. In 1976,
Tek Hua Trading Co. was dissolved. Later, the original members
of Tek Hua Trading Co. including Manuel C. Tiong, formed Tek
Hua Enterprising Corp., herein respondent corporation.
So Pek Giok, managing partner of Tek Hua Trading, died in 1986.
So Pek Giok's grandson, petitioner So Ping Bun, occupied the
warehouse for his own textile business, Trendsetter Marketing.
On August 1, 1989, lessor DCCSI sent letters addressed to Tek
Hua Enterprises, informing the latter of the 25% increase in rent
effective September 1, 1989. The rent increase was later on
reduced to 20% effective January 1, 1990, upon other lessees'
demand. Again on December 1, 1990, the lessor implemented a
30% rent increase. Enclosed in these letters were new lease
contracts for signing. DCCSI warned that failure of the lessee to
accomplish the contracts shall be deemed as lack of interest on
the lessee's part, and agreement to the termination of the lease.
Private respondents did not answer any of these letters. Still, the
lease contracts were not rescinded.
9
On March 1, 1991, private respondent Tiong sent a letter to
petitioner which reads as follows:
March 1, 1991
Mr. So Ping Bun
930 Soler Street
Binondo, Manila
Dear Mr. So,
Due to my closed (sic) business associate (sic) for three decades
with your late grandfather Mr. So Pek Giok and late father, Mr. So
Chong Bon, I allowed you temporarily to use the warehouse of Tek
Hua Enterprising Corp. for several years to generate your
personal business.
Since I decided to go back into textile business, I need a
warehouse immediately for my stocks. Therefore, please be
advised to vacate all your stocks in Tek Hua Enterprising Corp.
Warehouse. You are hereby given 14 days to vacate the premises
unless you have good reasons that you have the right to stay.
Otherwise, I will be constrained to take measure to protect my
interest.
Please give this urgent matter your preferential attention to avoid
inconvenience on your part.
Very truly yours,
(Sgd) Manuel C. Tiong
MANUEL C. TIONG
President 4
Petitioner refused to vacate. On March 4, 1992, petitioner
requested formal contracts of lease with DCCSI in favor
Trendsetter Marketing. So Ping Bun claimed that after the death of
his grandfather, So Pek Giok, he had been occupying the
premises for his textile business and religiously paid rent. DCCSI
acceded to petitioner's request. The lease contracts in favor of
Trendsetter were executed.
In the suit for injunction, private respondents pressed for the
nullification of the lease contracts between DCCSI and petitioner.
They also claimed damages.
After trial, the trial court ruled:
WHEREFORE, judgment is rendered:
1. Annulling the four Contracts of Lease (Exhibits A, A-1 to A-3,
inclusive) all dated March 11, 1991, between defendant So Ping
Bun, doing business under the name and style of "Trendsetter
Marketing", and defendant Dee C. Chuan & Sons, Inc. over
the premises located at Nos. 924-B, 924-C, 930 and 930, Int.,
respectively, Soler Street, Binondo Manila;
2. Making permanent the writ of preliminary injunction issued
by this Court on June 21, 1991;
3. Ordering defendant So Ping Bun to pay the aggrieved party,
plaintiff Tek Hua Enterprising Corporation, the sum of
P500,000.00, for attorney's fees;
4. Dismissing the complaint, insofar as plaintiff Manuel C.
Tiong is concerned, and the respective counterclaims of the
defendant;
5. Ordering defendant So Ping Bun to pay the costs of this
lawsuit;
This judgment is without prejudice to the rights of plaintiff Tek
Hua Enterprising Corporation and defendant Dee C. Chuan &
Sons, Inc. to negotiate for the renewal of their lease contracts
over the premises located at Nos. 930, 930-Int., 924-B and
924-C Soler Street, Binondo, Manila, under such terms and
conditions as they agree upon, provided they are not contrary
to law, public policy, public order, and morals.
SO ORDERED. 5 court, the three elements of tort interference above-mentioned are
Petitioner's motion for reconsideration of the above decision
was denied.
On appeal by So Ping Bun, the Court of Appeals upheld the
trial court. On motion for reconsideration, the appellate court
modified the decision by reducing the award of attorney's fees
from five hundred thousand (P500,000.00) pesos to two
hundred thousand (P200,000.00) pesos.
Petitioner is now before the Court raising the following issues:
I. WHETHER THE APPELLATE COURT ERRED IN
AFFIRMING THE TRIAL COURT'S DECISION FINDING SO
PING BUN GUILTY OF TORTUOUS INTERFERENCE OF
CONTRACT?
II. WHETHER THE APPELLATE COURT ERRED IN
AWARDING ATTORNEY'S FEES OF P200,000.00 IN FAVOR
OF PRIVATE RESPONDENTS.
The foregoing issues involve, essentially, the correct
interpretation of the applicable law on tortuous conduct,
particularly unlawful interference with contract. We have to
begin, obviously, with certain fundamental principles on torts
and damages.
Damage is the loss, hurt, or harm which results from injury,
and damages are the recompense or compensation awarded
for the damage suffered. 6 One becomes liable in an action for
damages for a nontrespassory invasion of another's interest in the
private use and enjoyment of asset if (a) the other has property
rights and privileges with respect to the use or enjoyment
interfered with, (b) the invasion is substantial, (c) the defendant's
conduct is a legal cause of the invasion, and (d) the invasion is
either intentional and unreasonable or unintentional and
actionable under general negligence rules. 7
The elements of tort interference are: (1) existence of a valid
contract; (2) knowledge on the part of the third person of the
existence of contract; and (3) interference of the third person is
without legal justification or excuse. 8
A duty which the law of torts is concerned with is respect for the
property of others, and a cause of action ex delicto may be
predicated upon an unlawful interference by one person of the
enjoyment by the other of his private
property.9 This may pertain to a situation where a third person
induces a party to renege on or violate his undertaking under a
contract. In the case before us, petitioner's Trendsetter Marketing
asked DCCSI to execute lease contracts in its favor, and as a
result petitioner deprived respondent corporation of the latter's
property right. Clearly, and as correctly viewed by the appellate
present in the instant case.
Authorities debate on whether interference may be justified where
the defendant acts for the sole purpose of furthering his own
financial or economic interest. 10 One view is that, as a general
rule, justification for interfering with the business relations of
another exists where the actor's motive is to benefit himself. Such
justification does not exist where his sole motive is to cause harm
to the other. Added to this, some authorities believe that it is not
necessary that the interferer's interest outweigh that of the party
whose rights are invaded, and that an individual acts under an
economic interest that is substantial, not merely de minimis, such
that wrongful and malicious motives are negatived, for he acts in
self-protection. 11 Moreover justification for protecting one's
financial position should not be made to depend on a comparison
of his economic interest in the subject matter with that of
others. 12 It is sufficient if the impetus of his conduct lies in a
proper business interest rather than in wrongful motives. 13
As early as Gilchrist vs. Cuddy, 14 we held that where there was
no malice in the interference of a contract, and the impulse behind
one's conduct lies in a proper business interest rather than in
wrongful motives, a party cannot be a malicious interferer. Where
the alleged interferer is financially interested, and such interest
motivates his conduct, it cannot be said that he is an officious or
malicious intermeddler. 15
10
In the instant case, it is clear that petitioner So Ping Bun prevailed
upon DCCSI to lease the warehouse to his enterprise at the
expense of respondent corporation. Though petitioner took
interest in the property of respondent corporation and benefited
from it, nothing on record imputes deliberate wrongful motives or
malice on him.
Sec. 1314 of the Civil Code categorically provides also that, "Any
third person who induces another to violate his contract shall be
liable for damages to the other contracting party." Petitioner
argues that damage is an essential element of tort interference,
and since the trial court and the appellate court ruled that private
respondents were not entitled to actual, moral or exemplary
damages, it follows that he ought to be absolved of any liability,
including attorney's fees.
It is true that the lower courts did not award damages, but this was
only because the extent of damages was not quantifiable. We had
a similar situation in Gilchrist, where it was difficult or impossible to
determine the extent of damage and there was nothing on record
to serve as basis thereof. In that case we refrained from awarding
damages. We believe the same conclusion applies in this case.
While we do not encourage tort interferers seeking their economic
interest to intrude into existing contracts at the expense of others,
however, we find that the conduct herein complained of did not
transcend the limits forbidding an obligatory award for damages in
the absence of any malice. The business desire is there to make
some gain to the detriment of the contracting parties. Lack of
malice, however, precludes damages. But it does not relieve
petitioner of the legal liability for entering into contracts and
causing breach of existing ones. The respondent appellate court
correctly confirmed the permanent injunction and nullification of
the lease contracts between DCCSI and Trendsetter Marketing,
without awarding damages. The injunction saved the respondents
from further damage or injury caused by petitioner's interference.
Lastly, the recovery of attorney's fees in the concept of actual or
compensatory damages, is allowed under the circumstances
provided for in Article 2208 of the Civil Code. 16 One such
occasion is when the defendant's act or omission has compelled
the plaintiff to litigate with third persons or to incur expenses to
protect his interest. 17 But we have consistently held that the
award of considerable damages should have clear factual and
legal bases. 18 In connection with attorney's fees, the award
should be commensurate to the benefits that would have been
derived from a favorable judgment. Settled is the rule that fairness
of the award of damages by the trial court calls for appellate
review such that the award if far too excessive can be
reduced. 19 This ruling applies with equal force on the award of
attorney's fees. In a long line of cases we said, "It is not sound
policy to place in penalty on the right to litigate. To compel the
defeated party to pay the fees of counsel for his successful
opponent would throw wide open the door of temptation to the
opposing party and his counsel to swell the fees to undue
proportions."20
Considering that the respondent corporation's lease contract,
at the time when the cause of action accrued, ran only on a
month-to-month basis whence before it was on a yearly basis,
we find even the reduced amount of attorney's fees ordered by
the Court of Appeals still exorbitant in the light of prevailing
jurisprudence. 21Consequently, the amount of two hundred
thousand (P200,000.00) awarded by respondent appellate
court should be reduced to one hundred thousand
(P100,000.00) pesos as the reasonable award or attorney's
fees in favor of private respondent corporation.
WHEREFORE, the petition is hereby DENIED. The assailed
Decision and Resolution of the Court of Appeals in CA-G.R.
CV No. 38784 are hereby AFFIRMED, with MODIFICATION
that the award of attorney's fees is reduced from two hundred
thousand (P200,000.00) to one hundred thousand
(P100,000.00) pesos. No pronouncement as to
costs.1wphi1.nt
SO ORDERED.
JARCO MARKETING CORPORATION, LEONARDO KONG,
JOSE TIOPE and ELISA PANELO, petitioners,
vs. HONORABLE COURT OF APPEALS, CONRADO C.
AGUILAR and CRISELDA R. AGUILAR, respondents.
DECISION
DAVIDE, JR., C.J.:
In this petition for review on certiorari under Rule 45 of the
Rules of Court, petitioners seek the reversal of the 17 June
1996 decision[1] of the Court of Appeals in C.A. G.R. No. CV
37937 and the resolution[2]denying their motion for
reconsideration. The assailed decision set aside the 15
January 1992 judgment of the Regional Trial Court (RTC),
Makati City, Branch 60 in Civil Case No. 7119 and ordered
petitioners to pay damages and attorneys fees to private
respondents Conrado and Criselda (CRISELDA) Aguilar.
Petitioner Jarco Marketing Corporation is the owner of Syvels
Department Store, Makati City. Petitioners Leonardo Kong,
Jose Tiope and Elisa Panelo are the stores branch manager,
operations manager, and supervisor, respectively. Private
respondents are spouses and the parents of Zhieneth Aguilar
(ZHIENETH).
In the afternoon of 9 May 1983, CRISELDA and ZHIENETH were
at the 2nd floor of Syvels Department Store, Makati
City. CRISELDA was signing her credit card slip at the payment
and verification counter when she felt a sudden gust of wind and
heard a loud thud. She looked behind her. She then beheld her
daughter ZHIENETH on the floor, her young body pinned by the
bulk of the stores gift-wrapping counter/structure. ZHIENETH was
crying and screaming for help. Although shocked, CRISELDA was
quick to ask the assistance of the people around in lifting the
counter and retrieving ZHIENETH from the floor.[3]
ZHIENETH was quickly rushed to the Makati Medical Center
where she was operated on. The next day ZHIENETH lost her
speech and thereafter communicated with CRISELDA by writing
on a magic slate. The injuries she sustained took their toil on her
young body. She died fourteen (14) days after the accident or on
22 May 1983, on the hospital bed. She was six years old.[4]
The cause of her death was attributed to the injuries she
sustained. The provisional medical certificate[5] issued by
ZHIENETHs attending doctor described the extent of her injuries:
Diagnoses:
falling on top of her, pinning her stomach. In contrast, none of
1. Shock, severe, sec. to intra-abdominal injuries due to blunt
injury
2. Hemorrhage, massive, intraperitoneal sec. to laceration, (L)
lobe liver
3. Rupture, stomach, anterior & posterior walls
4. Complete transection, 4th position, duodenum
5. Hematoma, extensive, retroperitoneal
6. Contusion, lungs, severe
CRITICAL
After the burial of their daughter, private respondents demanded
upon petitioners the reimbursement of the hospitalization, medical
bills and wake and funeral expenses[6] which they had
incurred. Petitioners refused to pay. Consequently, private
respondents filed a complaint for damages, docketed as Civil
Case No. 7119 wherein they sought the payment of P157,522.86
for actual damages, P300,000 for moral damages, P20,000 for
attorneys fees and an unspecified amount for loss of income and
exemplary damages.
In their answer with counterclaim, petitioners denied any liability
for the injuries and consequent death of ZHIENETH. They
claimed that CRISELDA was negligent in exercising care and
diligence over her daughter by allowing her to freely roam around
in a store filled with glassware and appliances. ZHIENETH too,
11
was guilty of contributory negligence since she climbed the
counter, triggering its eventual collapse on her. Petitioners also
emphasized that the counter was made of sturdy wood with a
strong support; it never fell nor collapsed for the past fifteen years
since its construction.
Additionally, petitioner Jarco Marketing Corporation maintained
that it observed the diligence of a good father of a family in the
selection, supervision and control of its employees. The other
petitioners likewise raised due care and diligence in the
performance of their duties and countered that the complaint was
malicious for which they suffered besmirched reputation and
mental anguish. They sought the dismissal of the complaint and
an award of moral and exemplary damages and attorneys fees in
their favor.
In its decision[7] the trial court dismissed the complaint and
counterclaim after finding that the preponderance of the evidence
favored petitioners. It ruled that the proximate cause of the fall of
the counter on ZHIENETH was her act of clinging to it. It believed
petitioners witnesses who testified that ZHIENETH clung to the
counter, afterwhich the structure and the girl fell with the structure
private respondents witnesses testified on how the counter
fell. The trial court also held that CRISELDAs negligence
contributed to ZHIENETHs accident.
In absolving petitioners from any liability, the trial court reasoned
that the counter was situated at the end or corner of the 2nd floor
as a precautionary measure hence, it could not be considered as
an attractive nuisance.[8] The counter was higher than
ZHIENETH. It has been in existence for fifteen years. Its structure
was safe and well-balanced. ZHIENETH, therefore, had no
business climbing on and clinging to it.
Private respondents appealed the decision, attributing as errors of
the trial court its findings that: (1) the proximate cause of the fall of
the counter was ZHIENETHs misbehavior; (2) CRISELDA was
negligent in her care of ZHIENETH; (3) petitioners were not
negligent in the maintenance of the counter; and (4) petitioners
were not liable for the death of ZHIENETH.
Further, private respondents asserted that ZHIENETH should be
entitled to the conclusive presumption that a child below nine (9)
years is incapable of contributory negligence. And even if
ZHIENETH, at six (6) years old, was already capable of
contributory negligence, still it was physically impossible for her to
have propped herself on the counter. She had a small frame (four
feet high and seventy pounds) and the counter was much higher
and heavier than she was. Also, the testimony of one of the stores
former employees, Gerardo Gonzales, who accompanied
ZHIENETH when she was brought to the emergency room of the
Makati Medical Center belied petitioners theory that
ZHIENETH climbed the counter. Gonzales claimed that when
ZHIENETH was asked by the doctor what she did, ZHIENETH
replied, [N]othing, I did not come near the counter and the
counter just fell on me.[9] Accordingly, Gonzales testimony on
ZHIENETHs spontaneous declaration should not only be
considered as part of res gestae but also accorded credit.
Moreover, negligence could not be imputed to CRISELDA for it
was reasonable for her to have let go of ZHIENETH at the
precise moment that she was signing the credit card slip.
Finally, private respondents vigorously maintained that the
proximate cause of ZHIENETHs death, was petitioners
negligence in failing to institute measures to have the counter
permanently nailed.
On the other hand, petitioners argued that private respondents
raised purely factual issues which could no longer be
disturbed. They explained that ZHIENETHs death while
unfortunate and tragic, was an accident for which neither
CRISELDA nor even ZHIENETH could entirely be held
faultless and blameless. Further, petitioners adverted to the
trial courts rejection of Gonzales testimony as unworthy of
credence.
As to private respondents claim that the counter should have
been nailed to the ground, petitioners justified that it was not
necessary. The counter had been in existence for several
years without any prior accident and was deliberately placed
at a corner to avoid such accidents. Truth to tell, they acted
without fault or negligence for they had exercised due
diligence on the matter. In fact, the criminal case[10] for
homicide through simple negligence filed by private
respondents against the individual petitioners was dismissed;
a verdict of acquittal was rendered in their favor.
The Court of Appeals, however, decided in favor of private
respondents and reversed the appealed judgment. It found
that petitioners were negligent in maintaining a structurally
dangerous counter. The counter was shaped like an inverted
L[11] with a top wider than the base. It was top heavy and the
weight of the upper portion was neither evenly distributed nor
supported by its narrow base. Thus, the counter was
defective, unstable and dangerous; a downward pressure on
the overhanging portion or a push from the front could cause
the counter to fall. Two former employees of petitioners had
already previously brought to the attention of the management
the danger the counter could cause. But the latter ignored their
concern. The Court of Appeals faulted the petitioners for this
omission, and concluded that the incident that befell
ZHIENETH could have been avoided had petitioners repaired
the defective counter. It was inconsequential that the counter had
been in use for some time without a prior incident.
The Court of Appeals declared that ZHIENETH, who was below
seven (7) years old at the time of the incident, was absolutely
incapable of negligence or other tort. It reasoned that since a child
under nine (9) years could not be held liable even for an
intentional wrong, then the six-year old ZHIENETH could not be
made to account for a mere mischief or reckless act. It also
absolved CRISELDA of any negligence, finding nothing wrong or
out of the ordinary in momentarily allowing ZHIENETH to walk
while she signed the document at the nearby counter.
The Court of Appeals also rejected the testimonies of the
witnesses of petitioners. It found them biased and prejudiced. It
instead gave credit to the testimony of disinterested witness
Gonzales. The Court of Appeals then awarded P99,420.86 as
actual damages, the amount representing the hospitalization
expenses incurred by private respondents as evidenced by the
hospital's statement of account.[12] It denied an award for funeral
expenses for lack of proof to substantiate the same. Instead, a
compensatory damage of P50,000 was awarded for the death of
ZHIENETH.
We quote the dispositive portion of the assailed decision,[13] thus:
WHEREFORE, premises considered, the judgment of the lower
court is SET ASIDE and another one is entered against
[petitioners], ordering them to pay jointly and severally unto
[private respondents] the following:
1. P50,000.00 by way of compensatory damages for the death of
Zhieneth Aguilar, with legal interest (6% p.a.) from 27 April 1984;
2. P99,420.86 as reimbursement for hospitalization expenses
incurred; with legal interest (6% p.a.) from 27 April 1984;
3. P100,000.00 as moral and exemplary damages;
4. P20,000.00 in the concept of attorneys fees; and
5. Costs.
Private respondents sought a reconsideration of the decision but
the same was denied in the Court of Appeals resolution [14] of 16
July 1997.
Petitioners now seek the reversal of the Court of Appeals decision
and the reinstatement of the judgment of the trial court. Petitioners
primarily argue that the Court of Appeals erred in disregarding the
factual findings and conclusions of the trial court. They stress that
since the action was based on tort, any finding of negligence on
the part of the private respondents would necessarily negate their
claim for damages, where said negligence was the proximate
cause of the injury sustained. The injury in the instant case was
12
the death of ZHIENETH. The proximate cause was ZHIENETHs
act of clinging to the counter. This act in turn caused the counter
to fall on her. This and CRISELDAs contributory negligence,
through her failure to provide the proper care and attention to her
child while inside the store, nullified private respondents claim for
damages. It is also for these reasons that parents are made
accountable for the damage or injury inflicted on others by their
minor children. Under these circumstances, petitioners could not
be held responsible for the accident that befell ZHIENETH.
Petitioners also assail the credibility of Gonzales who was already
separated from Syvels at the time he testified; hence, his
testimony might have been tarnished by ill-feelings against them.
For their part, private respondents principally reiterated their
arguments that neither ZHIENETH nor CRISELDA was negligent
at any time while inside the store; the findings and conclusions of
the Court of Appeals are substantiated by the evidence on record;
the testimony of Gonzales, who heard ZHIENETH comment on
the incident while she was in the hospitals emergency room
should receive credence; and finally, ZHIENETHs part of the res
gestae declaration that she did nothing to cause the heavy
structure to fall on her should be considered as the correct version
of the gruesome events.
We deny the petition.
The two issues to be resolved are: (1) whether the death of
ZHIENETH was accidental or attributable to negligence; and (2) in
case of a finding of negligence, whether the same was attributable
to private respondents for maintaining a defective counter or to
CRISELDA and ZHIENETH for failing to exercise due and
reasonable care while inside the store premises.
An accident pertains to an unforeseen event in which no fault or
negligence attaches to the defendant.[15] It is a fortuitous
circumstance, event or happening; an event happening without
any human agency, or if happening wholly or partly through
human agency, an event which under the circumstances is
unusual or unexpected by the person to whom it happens.[16]
On the other hand, negligence is the omission to do something
which a reasonable man, guided by those considerations which
ordinarily regulate the conduct of human affairs, would do, or the
doing of something which a prudent and reasonable man would
not do.[17] Negligence is the failure to observe, for the protection of
the interest of another person, that degree of care, precaution and
vigilance which the circumstances justly demand, whereby such
other person suffers injury.[18]
Accident and negligence are intrinsically contradictory; one cannot
exist with the other. Accident occurs when the person concerned
is exercising ordinary care, which is not caused by fault of any
person and which could not have been prevented by any
means suggested by common prudence.[19]
The test in determining the existence of negligence is
enunciated in the landmark case of Picart v. Smith,[20] thus: Did
the defendant in doing the alleged negligent act use that
reasonable care and caution which an ordinarily prudent
person would have used in the same situation? If not, then he
is guilty of negligence.[21]
We rule that the tragedy which befell ZHIENETH was no
accident and that ZHIENETHs death could only be attributed
to negligence.
We quote the testimony of Gerardo Gonzales who was at the
scene of the incident and accompanied CRISELDA and
ZHIENETH to the hospital:
Q While at the Makati Medical Center, did you hear or notice
anything while the child was being treated?
A At the emergency room we were all surrounding the
child. And when the doctor asked the child what did you do,
the child said nothing, I did not come near the counter and the
counter just fell on me.
Q (COURT TO ATTY. BELTRAN)
You want the words in Tagalog to be translated?
ATTY. BELTRAN
Yes, your Honor.
COURT
Granted. Intercalate wala po, hindi po ako lumapit doon. Basta
bumagsak.[22]
This testimony of Gonzales pertaining to ZHIENETHs
statement formed (and should be admitted as) part of the res
gestae under Section 42, Rule 130 of the Rules of Court, thus:
Part of res gestae. Statements made by a person while a
startling occurrence is taking place or immediately prior or
subsequent thereto with respect to the circumstances thereof,
may be given in evidence as part of the res gestae. So, also,
statements accompanying an equivocal act material to the
issue, and giving it a legal significance, may be received as
part of the res gestae.
It is axiomatic that matters relating to declarations of pain or
suffering and statements made to a physician are generally
considered declarations and admissions.[23] All that is required
for their admissibility as part of the res gestae is that they be
made or uttered under the influence of a startling event before
the declarant had the time to think and concoct a falsehood as
witnessed by the person who testified in court. Under the
circumstances thus described, it is unthinkable for ZHIENETH, a
child of such tender age and in extreme pain, to have lied to a
doctor whom she trusted with her life. We therefore accord
credence to Gonzales testimony on the matter, i.e., ZHIENETH
performed no act that facilitated her tragic death. Sadly,
petitioners did, through their negligence or omission to secure or
make stable the counters base.
Gonzales earlier testimony on petitioners insistence to keep and
maintain the structurally unstable gift-wrapping counter proved
their negligence, thus:
Q When you assumed the position as gift wrapper at the second
floor, will you please describe the gift wrapping counter, were you
able to examine?
A Because every morning before I start working I used to clean
that counter and since it is not nailed and it was only standing on
the floor, it was shaky.
xxx
Q Will you please describe the counter at 5:00 oclock [sic] in the
afternoon on [sic] May 9 1983?
A At that hour on May 9, 1983, that counter was standing beside
the verification counter. And since the top of it was heavy and
considering that it was not nailed, it can collapse at anytime, since
the top is heavy.
xxx
Q And what did you do?
A I informed Mr. Maat about that counter which is [sic] shaky and
since Mr. Maat is fond of putting display decorations on tables, he
even told me that I would put some decorations. But since I told
him that it not [sic] nailed and it is shaky he told me better inform
also the company about it. And since the company did not do
anything about the counter, so I also did not do anything about
the counter.[24] [Emphasis supplied]
Ramon Guevarra, another former employee, corroborated the
testimony of Gonzales, thus:
Q Will you please described [sic] to the honorable Court the
counter where you were assigned in January 1983?
xxx
A That counter assigned to me was when my supervisor ordered
me to carry that counter to another place. I told him that the
counter needs nailing and it has to be nailed because it might
cause injury or accident to another since it was shaky.
13
Q When that gift wrapping counter was transferred at the second
floor on February 12, 1983, will you please describe that to the
honorable Court?
A I told her that the counter wrapper [sic] is really in
good [sic] condition; it was shaky. I told her that we had to nail it.
Q When you said she, to whom are you referring to [sic]?
A I am referring to Ms. Panelo, sir.
Q And what was the answer of Ms. Panelo when you told her that
the counter was shaky?
A She told me Why do you have to teach me. You are only my
subordinate and you are to teach me? And she even got angry at
me when I told her that.
xxx
Q From February 12, 1983 up to May 9, 1983, what if any, did Ms.
Panelo or any employee of the management do to that (sic)
xxx
Witness:
None, sir. They never nailed the counter. They only nailed the
counter after the accident happened.[25] [Emphasis supplied]
Without doubt, petitioner Panelo and another store supervisor
were personally informed of the danger posed by the unstable
counter. Yet, neither initiated any concrete action to remedy the
situation nor ensure the safety of the stores employees and
patrons as a reasonable and ordinary prudent man would have
done. Thus, as confronted by the situation petitioners miserably
failed to discharge the due diligence required of a good father of a
family.
On the issue of the credibility of Gonzales and Guevarra,
petitioners failed to establish that the formers testimonies were
biased and tainted with partiality. Therefore, the allegation that
Gonzales and Guevarras testimonies were blemished by ill
feelings against petitioners since they (Gonzales and Guevarra)
were already separated from the company at the time their
testimonies were offered in court was but mere speculation and
deserved scant consideration.
It is settled that when the issue concerns the credibility of
witnesses, the appellate courts will not as a general rule disturb
the findings of the trial court, which is in a better position to
determine the same. The trial court has the distinct advantage of
actually hearing the testimony of and observing the deportment of
the witnesses.[26] However, the rule admits of exceptions such as
when its evaluation was reached arbitrarily or it overlooked or
failed to appreciate some facts or circumstances of weight and
substance which could affect the result of the case.[27] In the
instant case, petitioners failed to bring their claim within the
exception.
Anent the negligence imputed to ZHIENETH, we apply the
conclusive presumption that favors children below nine (9)
years old in that they are incapable of contributory
negligence. In his book,[28] former Judge Cezar S. Sangco
stated:
In our jurisdiction, a person under nine years of age is
conclusively presumed to have acted without discernment,
and is, on that account, exempt from criminal liability. The
same presumption and a like exemption from criminal liability
obtains in a case of a person over nine and under fifteen years
of age, unless it is shown that he has acted with
discernment. Since negligence may be a felony and a quasi-
delict and required discernment as a condition of liability,
either criminal or civil, a child under nine years of age is, by
analogy, conclusively presumed to be incapable of negligence;
and that the presumption of lack of discernment or incapacity
for negligence in the case of a child over nine but under fifteen
years of age is a rebuttable one, under our law. The rule,
therefore, is that a child under nine years of age must be
conclusively presumed incapable of contributory negligence
as a matter of law. [Emphasis supplied]
Even if we attribute contributory negligence to ZHIENETH and
assume that she climbed over the counter, no injury should
have occurred if we accept petitioners theory that the counter
was stable and sturdy. For if that was the truth, a frail six-year
old could not have caused the counter to collapse. The
physical analysis of the counter by both the trial court and
Court of Appeals and a scrutiny of the evidence[29]on record
reveal otherwise, i.e., it was not durable after all. Shaped like
an inverted L, the counter was heavy, huge, and its top laden
with formica. It protruded towards the customer waiting area
and its base was not secured.[30]
CRISELDA too, should be absolved from any contributory
negligence. Initially, ZHIENETH held on to CRISELDAs waist,
later to the latters hand. [31] CRISELDA momentarily released
the childs hand from her clutch when she signed her credit
card slip. At this precise moment, it was reasonable and usual
for CRISELDA to let go of her child. Further, at the time
ZHIENETH was pinned down by the counter, she was just a
foot away from her mother; and the gift-wrapping counter was
just four meters away from CRISELDA. [32] The time and
distance were both significant.ZHIENETH was near her
mother and did not loiter as petitioners would want to impress
upon us. She even admitted to the doctor who treated her at
the hospital that she did not do anything; the counter just fell on search party composed of, among others, Capts. Willis
her. Rohlings and Jaime Manzano, both of the PAL organized to
track down the missing helicopter, found it in a ravine located in
the barrio of Ampusungan, Benguet, Mt. Province within the
WHEREFORE, in view of all the foregoing, the instant petition is lumber concession of defendant-appellee, Heald Lumber Co.
DENIED and the challenged decision of the Court of Appeals of which is several kilometers before reaching Mankayan. The
17 June 1996 in C.A. G.R. No. CV 37937 is hereby AFFIRMED. helicopter was a total wreck and both Capt. Hernandez and Lt.
Imperial were dead. The body of the former was strapped to his
Costs against petitioners. seat, but that of the latter was several feet away from the
SO ORDERED. wreckage. At the time of the flight, Capt. Hernandez was a duly
licensed helicopter pilot, whereas Lt. Imperial, although a licensed
plane pilot, was then under training as helicopter pilot.
G.R. No. L-14088 September 30, 1961 Owing to this accident, three (3) actions were instituted in the
CONCEPCION PELLOSA VDA. DE IMPERIAL, in her own court aforementioned, against said defendant, namely: (1) case
behalf and as Guardian Ad Litem of her minor child, No. 580 (G.R. No. L-14112), filed by PAL on March 2, 1956; (2)
REX IMPERIAL, JR., plaintiffs-appellants, case No. 591 (G.R. No. L-14088), filed by Concepcion Pellosa de
vs. Imperial, widow of the deceased Lt. Imperial, on April 13, 1956;
HEALD LUMBER COMPANY, defendant-appellee. and 3) case No. 592 (G.R. No. L-14089), filed by Lourdes Ferrer
de Hernandez, widow of Capt. Hernandez, on the date last
-------------------------------- mentioned.
G.R. No. L-14089 September 30, 1961 In the first case, the PAL sought to recover the following:
LOURDES FERRER VDA. DE HERNANDEZ, in her own behalf
and as Guardian Ad Litem of her minor children,
upon the ground that the mishap was due to the fact that the
JULIO HERNANDEZ, GABRIEL HERNANDEZ, JR., and
ROSARIO HERNANDEZ, plaintiffs-appellants, helicopter had collided "with defendant's tramway steel cables
vs. strung in parallel of approximately 3,000 yards in length between
HEALD LUMBER COMPANY, defendant-appellee. two mountains approximately 3,000 to 5,000 feet high in the
vicinity of defendant's logging area in Ampusungan, Mountain
-------------------------------- Province."
G.R. No. L-14112 September 30, 1961 In each of the other cases, the respective plaintiffs therein prayed
for judgment as follows:
PHILIPPINE AIR LINES, INC., plaintiff-appellant,
vs.
HEALD LUMBER COMPANY, defendant-appellee.
Actual and compensatory P150,000.00
CONCEPCION, J.: damages
Appeal from a decision of the Court of First Instance of Baguio Exemplary damages 50,000.00
dismissing the complaints in the above entitled three (3) cases,
with costs against the plaintiffs. Moral damages 50,000.00
On June 4, 1954, at about 6:50 a.m., a helicopter (PIC361) of the Expenses of litigation 10,000.00
Philippine Air Lines, Inc. (PAL), which had been chartered by the
Lepanto Consolidated Mining Co., took off from Nichols Fields, in Attorney's fees 20,000.00
Makati, Rizal, headed for Mankayan, Mt. Province, via Rosales,
Pangasinan. On board the helicopter were Capt. Gabriel
Hernandez and Lt. Rex Imperial. The helicopter reached Rosales TO TAL P280,000.00
at 8:22 a.m., and, fifty-three (53) minutes later, or at 9:15 a.m., it
undertook the last leg of its flight to Mankayan. However, the
helicopter did not reach this place for it crashed on the way. A
14
upon the theory that the death of Lt. Imperial and Capt.
Hernandez was due to defendant's alleged "gross negligence"
and "flagrant violation of applicable laws and regulations."
Being interrelated, the three (3) cases were jointly heard, and,
in due course, thereafter, the lower court, presided by Hon.
Jesus de Veyra, rendered the decision appealed from, finding
that plaintiffs had "failed to make out a case of negligence on
the part of the defendant" and, accordingly, dismissing the
three (3) complaints. Hence, this appeal by the plaintiffs. The
three (3) cases are before us the amount of the demand in
each being in excess of P200,000, exclusive of costs and
interest.
Appellants maintain that the accident is imputable to the
defendant, because the helicopter, particularly its main rotor
blades, had hit or collided with defendant's aforementioned
steel cables.
In this connection, Capt. Rohlings, who, at the time of the
occurrence, was Assistant Superintendent of the Flight Control
of the PAL, testified that, during the investigation conducted by
him at the site of the crash, he found on the rotor blades of the
helicopter.
several long marks which contained small indentations which
were parallel to each other, parallel lines, if you would put it
that way, these marks were covered by blackish substance of
some kind which I took to be of grease of some kind. (t.s.n, p.
95.)
Capt. Manzano, the Superintendent of Helicopter Operations
of the PAL, tried to corroborate this testimony of Capt.
Rohlings. Both opined that the marks were due to the contact
of said rotor blades with the steel cables of defendant herein.
Photographs (Exhibits E-21, E-22 and E-24) allegedly taken
by Capt. Rohlings of the rotor blades, purporting to show
the aforementioned markings, were introduced in evidence in
lieu of said rotor blades.
It is admitted, however, that the helicopter had hit a tree before
falling into a ravine. Moreover, commenting on appellants'
evidence, His Honor, the trial Judge, had the following to say:
The evidence for the plaintiffs as to the cause of the crash is
not conclusive. The main rotor blade was not preserved, so
this Court was not able to satisfy itself as to the nature of the
two long seriated streaks on the main rotor blade. The
composition of these streaks was not determined whether
they were grease from the steel cable or marks from hitting a
pine tree for it can be equally argued that these seriated
streaks could have been caused by the strands of a greasy
steel cable or the rough bark of a pine tree. (Decision, Record on consumed its entire supply of gasoline, thus justifying the belief
Appeal, pp. 19-20.) that it was forced to land in Ampusungan due to lack of gasoline,
and that, as the engine ceased to function, its maneuverability
Upon the other hand, defendant endeavored to prove that the
must have become impaired, in view of which it crashed, thus
mishap had been due to two (2) causes, namely: (1) exhaustion of
causing it to fall into a ravine in defendant's
the fuel; and (2) negligence of the pilot.
concession.1awphl.nt
The record shows that the helicopter had a main tank and an
Several factors indicate strongly that this was in all likelihood what
auxiliary tank with a capacity of twenty-seven (27) and fifteen (15)
happened for: (1) the site of the crash was more than a mile (over
gallons of fuel, respectively. The main tank was connected to the
three [3] miles, according to the defendant) off the plotted course,
engine, but the auxiliary tank was not. In order to transfer gasoline
altho, under normal conditions, no reasonably prudent pilot
from the latter to the former, it was necessary to land the
according to appellants witness, Capt. Manzano would have
helicopter, as the process could not be undertaken during flight.
attempted to land in the vicinity of the scene of the occurrence; (2)
This was, in all probability, the reason why the aircraft had to land
the wrecked helicopter emitted no smell of gasoline and there was
in Rosales, Pangasinan, before proceeding to Mankayan.
no sign of fire resulting from the crash, despite the fact that the
Having left Rosales at 9:15 a.m., after its flight from Nichols Field, helicopter was using high octane gasoline, which, admittedly, is
of one (1) hour and thirty-two (32) minutes (from 6:50 to 8:22), the highly inflammable and would have probably set the craft aflame
helicopter was supposed to reach Mankayan at 10:44 a.m., the upon hitting the pine tree above referred to, had there been some
estimated flying time between Rosales and Mankayan being one gasoline in the tank at that time; and (3) the helicopter was a total
(1) hour and twenty-nine (29) minutes. Upon the other hand, the wreck, thus showing that the impact must have been strong.
time of the crash was placed at around 11:30 a.m., or between
The foregoing considerations suggest, also, that Capt. Hernandez
11:00 and 11:30 a.m. By that time the helicopter had already flown
and Lt. Imperial had acted recklessly in undertaking the flight with
from one (1) hour and forty-five (45) minutes to two (2) hours and
a supply of fuel hardly sufficient to enable them to reach their
fifteen (15) minutes, since it took off from Rosales, thus exceeding
destination. Besides, the landing report (Exhibit 9) shows that the
by sixteen (16) to forty-six (46) minutes the aforementioned
portions thereof pertaining to the pilot were accomplished or filled
estimated flying time. Considering that, with twenty-seven (27)
in by Lt. Imperial upon landing at the Rosales airport. In fact, he
gallons of gasoline, the helicopter had to refuel after a flight of one
signed said report as pilot of the helicopter. Again, it appears that
(1) hour and thirty-two (32) minutes (from Nichols Field to
during the flight from Rosales to Mankayan, the helicopter had
Rosales), it is apparent that, after flying for a longer period of one
deviated from one to three miles from the course plotted by Capt.
(1) hour and forty-five (45) minutes to two (2) hours and fifteen
Hernandez, in which Col. Arnaiz concurred "because that was the
(15) minutes, with a little over fifteen (15) gallons or at most
most logical route to follow." Had Capt. Hernandez been piloting
twenty-seven (27) gallons of gasoline, the provision of fuel must
the machine from Rosales to Mankayan, he would have had no
have already been exhausted.
reason to deviate from the course planned by him, for the "visibility
and ceiling were unlimited in the area and vicinity where the
Col. Arnaiz, aircraft dispatcher of PAL, testified that the "maximum
helicopter fell." All indications are, therefore, to the effect that, at
flight endurance" of the helicopter was "two hours and fifty
the time of the accident, the helicopter was being piloted, not by
minutes including the auxiliary tank." The Flight Plan (Exhibit B-1),
Capt. Hernandez but by Lt. Imperial, in violation of Aeronautics
as explained by Col. Arnaiz, shows that the estimated flying time
from Nichols Field to Rosales was one (1) hour and forty-two (42) Bulletin No. 1, Civil Aviation Regulations, of the Bureau of
minutes, and from Rosales to Mankayan, one (1) hour and Aeronautics (CAA)1 as well as of Republic Act No. 776, Section 42
twenty-nine (29) minutes, or an aggregate estimated flying time of (H),2 for Lt. Imperial was not a lincesed helicopter pilot and was
three (3) hours and eleven (11) minutes, or twenty-one (21) merely in the initial stage of his training as such pilot.
minutes longer than the estimated "maximum flight endurance" of
It is next urged that defendant was negligent in failing to give
the helicopter. Even if we deduct from said total estimated flying
notice to the Civil Aeronautics Administration of the presence of
time, from Nichols Field to Mankayan, the ten (10) minutes saved
the aforementioned tram cables, which, appellants maintain,
in the flight from Nichols Field to Rosales, Pangasinan, the result
constituted a hazard to aerial navigation. However, this pretense is
would still be eleven (11) minutes beyond the said "maximum
not borne out by the record. Appellants' witness, Capt. Manzano,
flight endurance" of the helicopter. In fact, the crash site
testified that although, in searching for the missing helicopter, his
(Ampusungan) is only about sixteen (16) kilometers, or ten (10)
plane flew so low that there was danger of collision with the
minutes flying time, to Mankayan. In other words, the accident
mountains, he did not notice said cables. The same were not,
took place in the area in which the helicopter was to have fully
15
therefore, within the navigable air space. Similarly, Capt.
Rohlings described the area over which the cables were
strung as "a congested area full of pine trees" and a
"mountainous terrain slopping valley," thereby implying that
the space from the cables down was not suitable for air
navigation. In short, it has not been satisfactorily shown that
the cables were a hazard to aerial navigation, or that the
defendant should have or could have reasonably foreseen that
aircrafts would fly so low over the place as to get entangled
with said cables, for the area is dangerous to navigation owing
to its mountainous terrain "full of pine trees."
In short plaintiffs-appellants have failed to establish their
pretense by a preponderance of evidence, in view of which the
decision appealed from must be, as it is hereby affirmed, with
costs against them. It is so ordered.
G.R. Nos. 114841-42 August 23, 1995
ATLANTIC GULF AND PACIFIC COMPANY OF MANILA,
INC., petitioner,
vs.
COURT OF APPEALS, CARLITO D. CASTILLO, HEIRS OF
CRISTETA CASTILLO and CORNELIO
CASTILLO, respondents.
REGALADO, J.:
Assailed in this appeal by certiorari is the judgment 1 of
respondent appellate court rendered in CA-G.R CV Nos.
29976-77, which affirmed with modifications the judgment of
the trial court by increasing the award of damages to herein
private respondents. While the increased awards could
arguably have been justified, it was the inaction of private
respondents that now militate against the same.
Sometime in 1982, petitioner company commenced the
construction of a steel fabrication plant in the Municipality of
Bauan, Batangas, necessitating dredging operations at the
Batangas Bay in an area adjacent to the real property of
private respondents.
As an offshoot of said dredging operations, an action for
damages against herein petitioner Atlantic Gulf and Pacific
Company of Manila, Inc. was filed by Carlito D. Castillo which
was docketed as Civil Case No. 10276, and another action by
Cristeta Castillo for herself and as guardian of Cornelio
Castillo, docketed as Civil Case No. 10696.
On August 19, 1985, the above-mentioned cases were
consolidated, as the plaintiffs therein intended to present
common evidence against defendant, 2 by reason of the virtual Ordering defendant-appellant to pay:
identity of the issues involved in both cases.
1. Carlito Castillo the following amounts:
Private respondents alleged that during the on-going construction
a) Compensatory damages in the amount of P56,290.00 with legal
of its steel and fabrication yard, petitioner's personnel and heavy
interest from the time of the finality of this decision until the same
equipment trespassed into the adjacent parcels of land belonging
shall have been fully paid;
to private respondents without their consent. These heavy
equipment damaged big portions of private respondents' property b) Exemplary damages in the amount of P10,000.00;
which were further used by petitioner as a depot or parking lots
c) Attorney's fees of P10,000.00; and
without paying any rent therefor, nor does it appear from the
records that such use of their land was with the former's d) Costs of this suit.
conformity.
2. Cornelio Castillo the following sums:
Private respondents further alleged that as a result of the
a) Compensatory damages in the amount of P255,401.25 with
dredging operation of petitioner company, the sea silt and water
legal interest from the time of the finality of this decision up to the
overflowed and were deposited upon their land. Consequently, the
time the amount is fully paid;
said property which used to be agricultural lands principally
devoted to rice production and each averaging an annual net b) Exemplary damages of P10,000.00;
harvest of 75 cavans, could no longer be planted with palay as the
soil became infertile, salty, unproductive and unsuitable for c) Attorney's fees of P10,000.00; and
agriculture.3
d) Costs of this suit;
Petitioner company denied all the allegations of private
3. Cristeta Castillo the following amount(s):
respondents and contended that its personnel and equipment had
neither intruded upon nor occupied any portion of private a) Compensatory damages of P249,815.62 with legal interest from
respondents' landholdings. The alleged sea silt with water, the time this decision becomes final until the amount is fully paid;
according to petitioner was due to the flood brought by the heavy
b) Exemplary damages of P10,000.00;
rains when typhoon "Ruping" hit and lashed the province of
Batangas in 1982.4 c) Attorney's fees of P10,000.00; and
On September 6, 1990, the trial court promulgated its decision d) Costs of suit.6
with this fallo:
Petitioner company is now before us, arguing for nullification or, at
WHEREFORE, judgment is hereby rendered ordering defendant: least, partial modification of respondent court's judgment on the
bases of the following assignment of errors:
1) To pay Carlito Castillo the sum of P65,240.00 plus legal interest
from the time of the filing of his complaint; I
2) To pay the heirs of Cristeta Castillo the sum of P32,630.00 plus That the respondent Honorable Court of Appeals exercised its
legal interest from the time of the filing of her complaint; judicial power and discretion in a most arbitrary, capricious and
whimsical manner by awarding against the petitioner,
3) To pay Cornelio Castillo the sum of P47,490.00 with legal
unconscionable, unreasonable and excessive damages clearly not
interest from the time of the filing of his complaint;
warranted under Articles 20 and 2176 of the Civil Code.
4) To pay plaintiffs the sum of P10,000.00 each as exemplary
II
damages;
That grave and patent abuse of discretion in the exercise of
5) To pay plaintiffs the sum of P10,000.00 each as attorney's fees;
judicial power constitute a ground for the issuance of the writ
6) To pay the costs of suit.5 of certiorari . . .
Dissatisfied with said judgment, petitioner company appealed to III
the Court of Appeals. On March 29, 1994, respondent court
That the respondent Honorable Court of Appeals violated Article
affirmed the judgment of the trial court with the following
2177 of the Civil Code which states that: "the plaintiff cannot
modifications:
recover damages twice for the same act or omission of the
16
defendant" when it condemned the petitioner as a result of its
dredging operations, to pay private respondents not only the
expected total amount of profits the latter would have derived
from the expected sale of their palay harvest for 135 months
or over 11 years, from the half hectare agricultural land, but
also rentals on the basis of P5.00 per square meter of their
said entire landholdings.7
The evidence on record indubitably support the findings of the
trial and appellate courts that petitioner company is liable for
the destruction of the property of herein private respondents
and consequently entitle the latter to an award of the damages
prayed for. Such conclusions and findings of fact by the lower
courts are entitled to great weight on appeal and will not be
disturbed except for strong and cogent reasons, none of
which, however, obtain in the case at bar. The fact that the
appellate court adopted the findings of the trial court, as in this
case, makes the same binding upon the Supreme Court, for
the factual findings of said appellate court are generally
binding on the latter. For that matter the findings of the Court
of Appeals by itself, and which are supported by substantial
evidence, are almost beyond the power of review by the
Supreme Court.8
Hence, on this aspect of its recourse, petitioner cannot expect
a reversal since it is a basic rule that only questions of law
may be raised in an appeal by certiorari under Rule 45 of the
Rules of Court. The jurisdiction of the Supreme Court in cases
thus brought to it from the Court of Appeals is limited to
reviewing and revising the errors of law imputed to it. 9 It is not
the function of this Court to analyze or weigh such evidence all
over again. Its jurisdiction is limited to reviewing errors of law
that might have been committed by the lower court. Barring a
showing that the factual findings complained of are totally
devoid of support in the record or that they are so glaringly
erroneous as to constitute serious abuse of discretion, such
findings must stand, for the Supreme Court is not expected or
required to examine or contrast the oral and documentary
evidence submitted by the parties.10
However, this Court finds that respondent Court of Appeals
committed a reversible error of law in increasing the amount of
damages awarded to private respondents by the court a quo.
Respondent appellate court exceeded its jurisdiction when it
modified the judgment of the trial court by increasing the
award of damages in favor of private respondents who, in the
first place, did not interpose an appeal therefrom. This being
the case, they are presumed to be satisfied with the
adjudication made by the lower court. As to them, the
judgment of the court below may be said to have attained
finality.
The entrenched procedural rule in this jurisdiction is that a party
who has not himself appealed cannot obtain from the appellate
court any affirmative relief other than those granted in the decision
of the lower court. The appellee can only advance any argument
that he may deem necessary to defeat the appellant's claim or to
uphold the decision that is being disputed. He can assign errors
on appeal if such are required to strengthen the views expressed
by the court a quo. Such assigned errors, in turn, may be
considered by the appellate court solely to maintain the appealed
decision on other grounds, but not for the purpose of modifying
the judgment in the appellee's favor and giving him other
affirmative reliefs.11
WHEREFORE, the challenged judgment of respondent Court of
Appeals is hereby MODIFIED with regard to the amount of
damages awarded to private respondents and the awards of the
trial court on this matter are hereby reinstated for that purpose. In
all other respects, the decision of respondent court is AFFIRMED,
without pronouncement as to costs.
SO ORDERED.
ANDAMO VS IAC
C. LAST CLEAR CHANCE (ART. 2179)
PHEONIX CONSTRUCTION vs IAC
G.R. No. 97626 March 14, 1997
PHILIPPINE BANK OF COMMERCE, now absorbed by
PHILIPPINE COMMERCIAL INTERNATIONAL BANK,
ROGELIO LACSON, DIGNA DE LEON, MARIA ANGELITA
PASCUAL, et al., petitioners,
vs.
THE COURT OF APPEALS, ROMMEL'S MARKETING CORP.,
represented by ROMEO LIPANA, its President & General
Manager, respondents.
HERMOSISIMA, JR., J.:
Challenged in this petition for review is the Decision dated
February 28, 19911 rendered by public respondent Court of
Appeals which affirmed the Decision dated November 15, 1985 of
the Regional Trial Court, National Capital Judicial Region, Branch
CLX (160), Pasig City, in Civil Case No. 27288 entitled "Rommel's
Marketing Corporation, etc. v. Philippine Bank of Commerce, now
absorbed by Philippine Commercial and Industrial Bank."
17
The case stemmed from a complaint filed by the private
respondent Rommel's Marketing Corporation (RMC for brevity),
represented by its President and General Manager Romeo
Lipana, to recover from the former Philippine Bank of Commerce
(PBC for brevity), now absorbed by the Philippine Commercial
International Bank, the sum of P304,979.74 representing various
deposits it had made in its current account with said bank but
which were not credited to its account, and were instead
deposited to the account of one Bienvenido Cotas, allegedly due
to the gross and inexcusable negligence of the petitioner bank.
RMC maintained two (2) separate current accounts, Current
Account Nos. 53-01980-3 and 53-01748-7, with the Pasig Branch
of PBC in connection with its business of selling appliances.
In the ordinary and usual course of banking operations, current
account deposits are accepted by the bank on the basis of deposit
slips prepared and signed by the depositor, or the latter's agent or
representative, who indicates therein the current account number
to which the deposit is to be credited, the name of the depositor or
current account holder, the date of the deposit, and the amount of
the deposit either in cash or checks. The deposit slip has an upper
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, however, the deposit slips are prepared in duplicate by
the depositor. The original of the deposit slip is retained by the
bank, while the duplicate copy is returned or given to the
depositor.
From May 5, 1975 to July 16, 1976, petitioner Romeo Lipana
claims to have entrusted RMC funds in the form of cash totalling
P304,979.74 to his secretary, Irene Yabut, for the purpose of
depositing said funds in the current accounts of RMC with PBC. It
turned out, however, that these deposits, on all occasions, were
not credited to RMC's account but were instead deposited to
Account No. 53-01734-7 of Yabut's husband, Bienvenido Cotas
who likewise maintains an account with the same bank. During
this period, petitioner bank had, however, been regularly
furnishing private respondent with monthly statements showing its
current accounts balances. Unfortunately, it had never been the
practice of Romeo Lipana to check these monthly statements of
account reposing complete trust and confidence on petitioner
bank.
Irene Yabut's modus operandi is far from complicated. She would
accomplish two (2) copies of the deposit slip, an original and a
duplicate. The original showed the name of her husband as
depositor and his current account number. On the duplicate copy
was written the account number of her husband but the name of
the account holder was left blank. PBC's teller, Azucena Mabayad,
would, however, validate and stamp both the original and the
duplicate of these deposit slips retaining only the original copy
despite the lack of information on the duplicate slip. The
second copy was kept by Irene Yabut allegedly for record
purposes. After validation, Yabut would then fill up the name of
RMC in the space left blank in the duplicate copy and change
the account number written thereon, which is that of her
husband's, and make it appear to be RMC's account
number, i.e., C.A. No. 53-01980-3. With the daily remittance
records also prepared by Ms. Yabut and submitted to private
respondent RMC together with the validated duplicate slips
with the latter's name and account number, she made her
company believe that all the while the amounts she deposited
were being credited to its account when, in truth and in fact,
they were being deposited by her and credited by the
petitioner bank in the account of Cotas. This went on in a span
of more than one (1) year without private respondent's
knowledge.
Upon discovery of the loss of its funds, RMC demanded from
petitioner bank the return of its money, but as its demand went
unheeded, it filed a collection suit before the Regional Trial
Court of Pasig, Branch 160. The trial court found petitioner
bank negligent and ruled as follows:
WHEREFORE, judgment is hereby rendered sentencing
defendant Philippine Bank of Commerce, now absorbed by
defendant Philippine Commercial & Industrial Bank, and
defendant Azucena Mabayad to pay the plaintiff, jointly and
severally, and without prejudice to any criminal action which
may be instituted if found warranted:
1. The sum of P304,979.72, representing plaintiffs lost deposit,
plus interest thereon at the legal rate from the filing of the
complaint;
2. A sum equivalent to 14% thereof, as exemplary damages;
3. A sum equivalent to 25% of the total amount due, as and for
attorney's fees; and
4. Costs.
Defendants' counterclaim is hereby dismissed for lack of
merit.2
On appeal, the appellate court affirmed the foregoing decision
with modifications, viz:
WHEREFORE, the decision appealed from herein is
MODIFIED in the sense that the awards of exemplary
damages and attorney's fees specified therein are eliminated
and instead, appellants are ordered to pay plaintiff, in addition
to the principal sum of P304,979.74 representing plaintiff's lost
deposit plus legal interest thereon from the filing of the
complaint, P25,000.00 attorney's fees and costs in the lower court
as well as in this Court.3
Hence, this petition anchored on the following grounds:
1) The proximate cause of the loss is the negligence of
respondent Rommel Marketing Corporation and Romeo Lipana in
entrusting cash to a dishonest employee.
2) The failure of respondent Rommel Marketing Corporation to
cross-check the bank's statements of account with its own records
during the entire period of more than one (1) year is the proximate
cause of the commission of subsequent frauds and
misappropriation committed by Ms. Irene Yabut.
3) The duplicate copies of the deposit slips presented by
respondent Rommel Marketing Corporation are falsified and are
not proof that the amounts appearing thereon were deposited to
respondent Rommel Marketing Corporation's account with the
bank,
4) The duplicate copies of the deposit slips were used by Ms.
Irene Yabut to cover up her fraudulent acts against respondent
Rommel Marketing Corporation, and not as records of deposits
she made with the bank.4
The petition has no merit.
Simply put, the main issue posited before us is: What is the
proximate cause of the loss, to the tune of P304,979.74, suffered
by the private respondent RMC petitioner bank's negligence or
that of private respondent's?
Petitioners submit that the proximate cause of the loss is the
negligence of respondent RMC and Romeo Lipana in entrusting
cash to a dishonest employee in the person of Ms. Irene
Yabut.5 According to them, it was impossible for the bank to know
that the money deposited by Ms. Irene Yabut belong to RMC;
neither was the bank forewarned by RMC that Yabut will be
depositing cash to its account. Thus, it was impossible for the
bank to know the fraudulent design of Yabut considering that her
husband, Bienvenido Cotas, also maintained an account with the
bank. For the bank to inquire into the ownership of the cash
deposited by Ms. Irene Yabut would be irregular. Otherwise
stated, it was RMC's negligence in entrusting cash to a dishonest
employee which provided Ms. Irene Yabut the opportunity to
defraud RMC.6
Private respondent, on the other hand, maintains that the
proximate cause of the loss was the negligent act of the bank,
thru its teller Ms. Azucena Mabayad, in validating the deposit
slips, both original and duplicate, presented by Ms. Yabut to Ms.
Mabayad, notwithstanding the fact that one of the deposit slips
was not completely accomplished.
18
We sustain the private respondent.
Our law on quasi-delicts states:
Art. 2176. Whoever by act or omission causes damage to another,
there being fault or negligence, is obliged to pay for the damage
done. Such fault or negligence, if there is no pre-existing
contractual relation between the parties, is called a quasi-
delict and is governed by the provisions of this Chapter.
There are three elements of a quasi-delict: (a) damages suffered
by the plaintiff; (b) fault or negligence of the defendant, or some
other person for whose acts he must respond; and (c) the
connection of cause and effect between the fault or negligence of
the defendant and the damages incurred by the plaintiff.7
In the case at bench, there is no dispute as to the damage
suffered by the private respondent (plaintiff in the trial court) RMC
in the amount of P304,979.74. It is in ascribing fault or negligence
which caused the damage where the parties point to each other
as the culprit.
Negligence is the omission to do something which a reasonable
man, guided by those considerations which ordinarily regulate the
conduct of human affairs, would do, or the doing of something
which a prudent and reasonable man would do. The seventy-eight
(78)-year-old, yet still relevant, case of Picart v. Smith,8 provides
the test by which to determine the existence of negligence in a
particular case which may be stated as follows: Did the defendant
in doing the alleged negligent act use that reasonable care and
caution which an ordinarily prudent person would have used in the
same situation? If not, then he is guilty of negligence. The law
here in effect adopts the standard supposed to be supplied by the
imaginary conduct of the discreet paterfamilias of the Roman law.
The existence of negligence in a given case is not determined by
reference to the personal judgment of the actor in the situation
before him. The law considers what would be reckless,
blameworthy, or negligent in the man of ordinary intelligence and
prudence and determines liability by that.
Applying the above test, it appears that the bank's teller, Ms.
Azucena Mabayad, was negligent in validating, officially stamping
and signing all the deposit slips prepared and presented by Ms.
Yabut, despite the glaring fact that the duplicate copy was not
completely accomplished contrary to the self-imposed procedure
of the bank with respect to the proper validation of deposit slips,
original or duplicate, as testified to by Ms. Mabayad herself, thus:
Q: Now, as teller of PCIB, Pasig Branch, will you please tell us
Mrs. Mabayad your important duties and functions?
A: I accept current and savings deposits from depositors and
encashments.
Q: Now in the handling of current account deposits of bank
clients, could you tell us the procedure you follow?
A: The client or depositor or the authorized representative
prepares a deposit slip by filling up the deposit slip with the
name, the account number, the date, the cash breakdown, if it
is deposited for cash, and the check number, the amount and
then he signs the deposit slip.
Q: Now, how many deposit slips do you normally require in
accomplishing current account deposit, Mrs. Mabayad?
A: The bank requires only one copy of the deposit although
some of our clients prepare the deposit slip in duplicate.
Q: Now in accomplishing current account deposits from your
clients, what do you issue to the depositor to evidence the
deposit made?
A: We issue or we give to the clients the depositor's stub as a
receipt of the deposit.
Q: And who prepares the deposit slip?
A: The depositor or the authorized representative sir?
Q: Where does the depositor's stub comes (sic) from Mrs.
Mabayad, is it with the deposit slip?
A: The depositor's stub is connected with the deposit slip or
the bank's copy. In a deposit slip, the upper portion is the
depositor's stub and the lower portion is the bank's copy, and
you can detach the bank's copy from the depositor's stub by
tearing it sir.
Q: Now what do you do upon presentment of the deposit slip
by the depositor or the depositor's authorized representative?
A: We see to it that the deposit slip9 is properly accomplished
and then we count the money and then we tally it with the
deposit slip sir.
Q: Now is the depositor's stub which you issued to your clients
validated?
A: Yes, sir. 10 [Emphasis ours]
Clearly, Ms. Mabayad failed to observe this very important
procedure. The fact that the duplicate slip was not
compulsorily required by the bank in accepting deposits
should not relieve the petitioner bank of responsibility. The odd
circumstance alone that such duplicate copy lacked one vital
information that of the name of the account holder
should have already put Ms. Mabayad on guard. Rather than
readily validating the incomplete duplicate copy, she should
have proceeded more cautiously by being more probing as to
the true reason why the name of the account holder in the
duplicate slip was left blank while that in the original was filled up.
She should not have been so naive in accepting hook, line and
sinker the too shallow excuse of Ms. Irene Yabut to the effect that
since the duplicate copy was only for her personal record, she
would simply fill up the blank space later on. 11 A "reasonable man
of ordinary prudence" 12would not have given credence to such
explanation and would have insisted that the space left blank be
filled up as a condition for validation. Unfortunately, this was not
how bank teller Mabayad proceeded thus resulting in huge losses
to the private respondent.
Negligence here lies not only on the part of Ms. Mabayad but also
on the part of the bank itself in its lackadaisical selection and
supervision of Ms. Mabayad. This was exemplified in the
testimony of Mr. Romeo Bonifacio, then Manager of the Pasig
Branch of the petitioner bank and now its Vice-President, to the
effect that, while he ordered the investigation of the incident, he
never came to know that blank deposit slips were validated in total
disregard of the bank's validation procedures, viz:
Q: Did he ever tell you that one of your cashiers affixed the stamp
mark of the bank on the deposit slips and they validated the same
with the machine, the fact that those deposit slips were unfilled
up, is there any report similar to that?
A: No, it was not the cashier but the teller.
Q: The teller validated the blank deposit slip?
A: No it was not reported.
Q: You did not know that any one in the bank tellers or cashiers
validated the blank deposit slip?
A: I am not aware of that.
Q: It is only now that you are aware of that?
A: Yes, sir. 13
Prescinding from the above, public respondent Court of Appeals
aptly observed:
xxx xxx xxx
It was in fact only when he testified in this case in February, 1983,
or after the lapse of more than seven (7) years counted from the
period when the funds in question were deposited in plaintiff's
accounts (May, 1975 to July, 1976) that bank manager Bonifacio
admittedly became aware of the practice of his teller Mabayad of
validating blank deposit slips. Undoubtedly, this is gross, wanton,
and inexcusable negligence in the appellant bank's supervision of
its employees. 14
19
It was this negligence of Ms. Azucena Mabayad, coupled by the
negligence of the petitioner bank in the selection and supervision
of its bank teller, which was the proximate cause of the loss
suffered by the private respondent, and not the latter's act of
entrusting cash to a dishonest employee, as insisted by the
petitioners.
Proximate cause is determined on the facts of each case upon
mixed considerations of logic, common sense, policy and
precedent. 15 Vda. de Bataclan v. Medina, 16 reiterated in the case
of Bank of the Phil. Islands v. Court of Appeals, 17 defines
proximate cause as "that cause, which, in natural and continuous
sequence, unbroken by any efficient intervening cause, produces
the injury, and without which the result would not have
occurred. . . ." In this case, absent the act of Ms. Mabayad in
negligently validating the incomplete duplicate copy of the deposit
slip, Ms. Irene Yabut would not have the facility with which to
perpetrate her fraudulent scheme with impunity. Apropos, once
again, is the pronouncement made by the respondent appellate
court, to wit:
. . . . Even if Yabut had the fraudulent intention to misappropriate
the funds entrusted to her by plaintiff, she would not have been
able to deposit those funds in her husband's current account, and
then make plaintiff believe that it was in the latter's accounts
wherein she had deposited them, had it not been for bank teller
Mabayad's aforesaid gross and reckless negligence. The latter's
negligence was thus the proximate, immediate and efficient cause
that brought about the loss claimed by plaintiff in this case, and
the failure of plaintiff to discover the same soon enough by failing
to scrutinize the monthly statements of account being sent to it by
appellant bank could not have prevented the fraud and
misappropriation which Irene Yabut had already completed when
she deposited plaintiff's money to the account of her husband
instead of to the latter's accounts. 18
Furthermore, under the doctrine of "last clear chance" (also
referred to, at times as "supervening negligence" or as
"discovered peril"), petitioner bank was indeed the culpable party.
This doctrine, in essence, states that where both parties are
negligent, but the negligent act of one is appreciably later in time
than that of the other, or when it is impossible to determine whose
fault or negligence should be attributed to the incident, the one
who had the last clear opportunity to avoid the impending harm
and failed to do so is chargeable with the consequences
thereof. 19Stated differently, the rule would also mean that an
antecedent negligence of a person does not preclude the recovery
of damages for the supervening negligence of, or bar a defense
against liability sought by another, if the latter, who had the last
fair chance, could have avoided the impending harm by the
exercise of due diligence. 20Here, assuming that private
respondent RMC was negligent in entrusting cash to a
dishonest employee, thus providing the latter with the
opportunity to defraud the company, as advanced by the
petitioner, yet it cannot be denied that the petitioner bank, thru
its teller, had the last clear opportunity to avert the injury
incurred by its client, simply by faithfully observing their self-
imposed validation procedure.
At this juncture, it is worth to discuss the degree of diligence
ought to be exercised by banks in dealing with their clients.
The New Civil Code provides:
Art. 1173. The fault or negligence of the obligor consists in the
omission of that diligence which is required by the nature of
the obligation and corresponds with the circumstances of the
persons, of the time and of the place. When negligence shows
bad faith, the provisions of articles 1171 and 2201, paragraph
2, shall apply.
If the law or contract does not state the diligence which is to
be observed in the performance, that which is expected of
a good father of a family shall be required. (1104a)
In the case of banks, however, the degree of diligence
required is more than that of a good father of a family.
Considering the fiduciary nature of their relationship with their
depositors, banks are duty bound to treat the accounts of their
clients with the highest degree of care. 21
As elucidated in Simex International (Manila), Inc. v. Court of
Appeals, 22 in every case, the depositor expects the bank to
treat his account with the utmost fidelity, whether such account
consists only of a few hundred pesos or of millions. The bank
must record every single transaction accurately, down to the
last centavo, and as promptly as possible. This has to be done
if the account is to reflect at any given time the amount of
money the depositor can dispose as he sees fit, confident that
the bank will deliver it as and to whomever he directs. A
blunder on the part of the bank, such as the failure to duly
credit him his deposits as soon as they are made, can cause
the depositor not a little embarrassment if not financial loss
and perhaps even civil and criminal litigation.
The point is that as a business affected with public interest
and because of the nature of its functions, the bank is under
obligation to treat the accounts of its depositors with
meticulous care, always having in mind the fiduciary nature of
their relationship. In the case before us, it is apparent that the
petitioner bank was remiss in that duty and violated that
relationship.
Petitioners nevertheless aver that the failure of respondent RMC
to cross-check the bank's statements of account with its own
records during the entire period of more than one (1) year is the
proximate cause of the commission of subsequent frauds and
misappropriation committed by Ms. Irene Yabut.
We do not agree.
While it is true that had private respondent checked the monthly
statements of account sent by the petitioner bank to RMC, the
latter would have discovered the loss early on, such cannot be
used by the petitioners to escape liability. This omission on the
part of the private respondent does not change the fact that were
it not for the wanton and reckless negligence of the petitioners'
employee in validating the incomplete duplicate deposit slips
presented by Ms. Irene Yabut, the loss would not have occurred.
Considering, however, that the fraud was committed in a span of
more than one (1) year covering various deposits, common
human experience dictates that the same would not have been
possible without any form of collusion between Ms. Yabut and
bank teller Mabayad. Ms. Mabayad was negligent in the
performance of her duties as bank teller nonetheless. Thus, the
petitioners are entitled to claim reimbursement from her for
whatever they shall be ordered to pay in this case.
The foregoing notwithstanding, it cannot be denied that, indeed,
private respondent was likewise negligent in not checking its
monthly statements of account. Had it done so, the company
would have been alerted to the series of frauds being committed
against RMC by its secretary. The damage would definitely not
have ballooned to such an amount if only RMC, particularly
Romeo Lipana, had exercised even a little vigilance in their
financial affairs. This omission by RMC amounts to contributory
negligence which shall mitigate the damages that may be
awarded to the private respondent 23 under Article 2179 of the
New Civil Code, to wit:
. . . When the plaintiff's own negligence was the immediate and
proximate cause of his injury, he cannot recover damages. But if
his negligence was only contributory, the immediate and
proximate cause of the injury being the defendant's lack of due
care, the plaintiff may recover damages, but the courts shall
mitigate the damages to be awarded.
In view of this, we believe that the demands of substantial justice
are satisfied by allocating the damage on a 60-40 ratio. Thus,
40% of the damage awarded by the respondent appellate court,
except the award of P25,000.00 attorney's fees, shall be borne by
private respondent RMC; only the balance of 60% needs to be
paid by the petitioners. The award of attorney's fees shall be
borne exclusively by the petitioners.
20
WHEREFORE, the decision of the respondent Court of Appeals is
modified by reducing the amount of actual damages private
respondent is entitled to by 40%. Petitioners may recover from
Ms. Azucena Mabayad the amount they would pay the private
respondent. Private respondent shall have recourse against Ms.
Irene Yabut. In all other respects, the appellate court's decision is
AFFIRMED.
Proportionate costs.
SO ORDERED.
[G.R. Nos. 79050-51. November 14, 1989.]
PANTRANCO NORTH EXPRESS, INC., Petitioner, v. MARICAR
BASCOS BAESA, thru her personal guardian FRANCISCA O.
BASCOS, FE O. ICO, in her behalf and in behalf of her minor
children, namely ERWIN, OLIVE, EDMUNDO and SHARON
ICO, Respondents.
Efren N. Ambrosio & Associates for petitioner PNEI.
Emiliano S. Micu for Respondents.
SYLLABUS
1. CIVIL LAW; DAMAGES; LAST CLEAR CHANCE DOCTRINE;
WHEN APPLICABLE. The doctrine of last clear chance applies
only in a situation where the defendant, having the last fair chance
to avoid the impending harm and failed to do so, becomes liable
for all the consequences of the accident notwithstanding the prior
negligence of the plaintiff.
2. ID.; ID.; ID.; CONDITION TO MAKE DOCTRINE APPLICABLE.
In order that the doctrine of last clear chance may be applied, it
must be shown that the person who allegedly had the last
opportunity to avert the accident was aware of the existence of the
peril or with exercise of due care should have been aware of it.
3. ID.; ID.; ID.; NOT APPLICABLE TO PERSON ACTING
INSTANTANEOUSLY OR BY AVAILABLE MEANS. This
doctrine of last chance has no application to a case where a
person is to act instantaneously, and if the injury cannot be
avoided by using all means available after the peril is or should
have been discovered.
4. ID.; ID.; PROVISION OF R.A. NO. 4136 RE VEHICLE
ENTERING A THROUGH HIGHWAY OR A STOP
INTERSECTION. Section 43 (c), Article III, Chapter IV of
Republic Act No. 1436 cannot apply to case a bar where at the
time of the accident, the jeepney had already crossed the
intersection.
5. ID.; ID.; NEGLIGENCE; BURDEN OF PROOF LIES ON
THE EMPLOYER. A finding of negligence on the part of the
driver establishes a presumption that the employer has been
negligent 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 adequately supervising their work.
6. ID.; ID.; FAILURE TO PRESENT EVIDENCE TO SUPPORT
CLAIM FOR DAMAGES. Plaintiffs failure to present
documentary evidence to support their claim for damages for
loss of earning capacity of the deceased victim does not bar
recovery of the damages, if such loss may be based
sufficiently on their testimonies.
7. ID.; ID.; INDEMNITY FIXED AT P30,000. The indemnity
for the death of a person was fixed by this Court at
(P30,000.00).
DECISION
CORTES, J.:
In this Petition, Pantranco North Express Inc. (PANTRANCO),
asks the Court to review the decision of the Court of Appeals
in CA-G.R. No. 05494-95 which affirmed the decisions of the
Court of First Instance of Rosales, Pangasinan in Civil Case
No. 561-R and Civil Case No. 589-R wherein PANTRANCO
was ordered to pay damages and attorneys fees to herein
private respondents.chanrobles virtual lawlibrary
The pertinent fact are as follows:
At about 7:00 oclock in the morning of June 12, 1981, the
spouses Ceasar and Marilyn Baesa and their children Harold
Jim, Marcelino and Maricar, together with spouses David Ico
and Fe O. Ico with their son Erwin Ico and seven other
persons, were aboard a passenger jeepney on their way to a
picnic at Malalam River, Ilagan, Isabela, to celebrate the fifth
wedding anniversary of Ceasar and Marilyn Baesa.
The group, numbering fifteen (15) persons, rode in the
passenger jeepney driven by David Ico, who was also the
registered owner thereof. From Ilagan, Isabela, they
proceeded to Barrio Capayacan to deliver some viands to one
Mrs. Bascos and thenceforth to San Felipe, taking the highway
going to Malalam River. Upon reaching the highway, the
jeepney turned right and proceeded to Malalam River at a
speed of about 20 kph. While they were proceeding towards
Malalam River, a speeding PANTRANCO bus from Aparri, on its
regular route to Manila, encroached on the jeepneys lane while
negotiating a curve, and collided with it.
As a result of the accident David Ico, spouses Ceasar Baesa and
Marilyn Baesa and their children, Harold Jim and Marcelino
Baesa, died while the rest of the passengers suffered injuries. The
jeepney was extensively damaged. After the accident the driver of
the PANTRANCO Bus, Ambrosio Ramirez, boarded a car and
proceeded to Santiago, Isabela. From that time on up to the
present, Ramirez has never been seen and has apparently
remained in hiding.
All the victims and/or their surviving heirs except herein private
respondents settled the case amicably under the "No Fault"
insurance coverage of PANTRANCO.
Maricar Baesa through her guardian Francisca O. Bascos and Fe
O. Ico for herself and for her minor children, filed separate actions
for damages arising from quasi-delict against PANTRANCO,
respectively docketed as Civil Case No. 561-R and 589-R of the
Court of First Instance of Pangasinan.
In its answer, PANTRANCO, aside from pointing to the late David
Icos alleged negligence as the proximate cause of the accident,
invoked the defense of due diligence in the selection and
supervision of its driver, Ambrosio
Ramirez.chanroblesvirtualawlibrary
On July 3, 1984, the CFI of Pangasinan rendered a decision
against PANTRANCO awarding the total amount of Two Million
Three Hundred Four Thousand Six Hundred Forty-Seven
(P2,304,647.00) as damages, plus 10% thereof as attorneys fees
and costs to Maricar Baesa in Civil Case No. 561-R, and the total
amount of Six Hundred Fifty Two Thousand Six Hundred Seventy-
Two Pesos (P652,672.00) as damages, plus 10% thereof as
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
of Appeals modified the decision of the trial court by ordering
PANTRANCO to pay the total amount of One Million One Hundred
Eighty-Nine Thousand Nine Hundred Twenty Seven Pesos
(P1,189,927.00) as damages, plus Twenty Thousand Pesos
(P20,000.00) as attorneys fees to Maricar Baesa, and the total
amount of Three Hundred Forty-Four Thousand Pesos
(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. The dispositive portion of the assailed decision reads
as follows:
WHEREFORE, the decision appealed from is hereby modified by
21
ordering the defendant PANTRANCO North Express, Inc. to pay:
I. The plaintiff in Civil Case No. 561-R, Maricar Bascos Baesa, the
following damages:
A) As compensatory damages for the death of Ceasar Baesa
P30,000.00;
B) As compensatory damages for the death of Marilyn Baesa
P30,000.00;
C) As compensatory damages for the death of Harold Jim Baesa
and Marcelino Baesa P30,000.00;
D) For the loss of earnings of Ceasar Baesa P630,000.00;
E) For the loss of earnings of Marilyn Bascos Baesa
P375,000.00;
F) For the burial expenses of the deceased Ceasar and Marilyn
Baesa P41,200.00;
G) For hospitalization expenses of Maricar Baesa P3,727.00;
H) As moral damages P50,000.00;
I) As attorneys fees P20,000.00;
II. The plaintiffs in Civil Case No. 589-R, the following damages:
A) As compensatory damages for the death of David Ico
P30,000.00;
B) For loss of earning capacity of David Ico P252,000.00;
C) As moral damages for the death of David Ico and the injury of
Fe Ico P30,000.00
D) As payment for the jeepney P20,000.00;
E) For the hospitalization of Fe Ico P12,000.000;
F) And for attorneys fees P10,000.00;
and to pay the costs in both cases.
The amount of P25,000 paid to Maricar Bascos Baesa, plaintiff in
Civil Case No. 561-R, and the medical expenses in the sum of
P3,273.55, should be deducted from the award in her
favor.chanrobles virtual lawlibrary
All the foregoing amounts herein awarded except the costs
shall earn interest at the legal rate from date of this decision
until fully paid. [CA Decision, pp. 14-15; Rollo, pp. 57-58.]
PANTRANCO filed a motion for reconsideration of the Court of
Appeals decision, but on June 26, 1987, it denied the same
for lack of merit. PANTRANCO then filed the instant petition
for review.
I
Petitioner faults the Court of Appeals for not applying the
doctrine of the "last clear chance" against the jeepney driver.
Petitioner 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 collision and was therefore negligent in
failing to utilize with reasonable care and competence his then
existing opportunity to avoid the harm.
The doctrine of the last clear chance was defined by this Court
in the case of Ong v. Metropolitan Water District, 104 Phil. 397
(1958), in this wise:
The doctrine of the last clear chance simply, means that the
negligence of a claimant does not preclude a recovery for the
negligence of defendant where it appears that the latter, by
exercising reasonable care and prudence, might have avoided
injurious consequences to claimant notwithstanding his
negligence.
The doctrine applies only in a situation where the plaintiff was
guilty of prior or antecedent negligence but the defendant, who
had the last fair chance to avoid the impending harm and
failed to do so, is made liable for all the consequences of the
accident notwithstanding the prior negligence of the plaintiff
[Picart v. Smith, 37 Phil. 809 (1918); Glan Peoples Lumber
and Hardware, Et. Al. v. Intermediate Appellate Court, Cecilia
Alferez Vda. de Calibo, Et Al., G.R. No. 70493, May 18, 1989].
The subsequent 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 more remote
negligence of the plaintiff, thus making the defendant liable to
the plaintiff [Picart v. Smith, supra].
Generally, the last clear chance doctrine is invoked for the
purpose of making a defendant liable to a plaintiff who was
guilty of prior or antecedent negligence, although it may also
be raised as a defense to defeat claim for
damages.chanrobles lawlibrary : rednad
To avoid liability for the negligence of its driver, petitioner claims
that the original negligence of its driver was not the proximate
cause of the accident and that the sole proximate cause was the
supervening negligence of the jeepney driver David Ico in failing
to avoid the accident. It is petitioners position that even assuming
arguendo, that the bus encroached into the lane of the jeepney,
the driver of the latter could have swerved the jeepney towards
the spacious dirt shoulder on his right without danger to himself or
his passengers.
The above contention of petitioner is manifestly devoid of merit.
Contrary to the petitioners contention, the doctrine of "last clear
chance" finds no application in this case. For the doctrine to be
applicable, it is necessary to show that the person who allegedly
had the last opportunity to avert the accident was aware of the
existence of the peril or should, with exercise of due care, have
been aware of it. One cannot be expected to avoid an accident or
injury if he does not know or could not have known the existence
of the peril. In this case, there is nothing to show that the jeepney
driver David Ico knew of the impending danger. When he saw at a
distance that the approaching bus was encroaching on his lane,
he did not immediately swerve the jeepney to the dirt shoulder on
his right since he must have assumed that the bus driver will
return the bus to its own lane upon seeing the jeepney
approaching from the opposite direction. As held by this Court in
the case of Vda. De Bonifacio v. BLTB, G.R. No. L-26810, August
31, 1970, 34 SCRA 618, a motorist who is properly proceeding on
his own side of the highway is generally entitled to assume that an
approaching vehicle coming towards him on the wrong side, will
return to his proper lane of traffic. There was nothing to indicate to
David Ico that the bus could not return to its own lane or was
prevented from returning to the proper lane by anything beyond
the control of its driver. Leo Marantan, an alternate driver of the
Pantranco bus who was seated beside the driver Ramirez at the
time of the accident, testified that Ramirez had no choice but to
swerve the steering wheel to the left and encroach on the
jeepneys lane because there was a steep precipice on the right
[CA Decision, p. 2; Rollo, p. 45]. However, this is belied by the
evidence on record which clearly shows that there was enough
space to swerve the bus back to its own lane without any danger
[CA Decision, p. 7; Rollo, p. 50].
Moreover, both the trial court and the Court of Appeals found that
at the time of the accident the Pantranco bus was speeding
towards Manila [CA Decision, p. 2; Rollo, p. 45]. By the time David
Ico must have realized that the bus was not returning to its own
lane, it was already too late to swerve the jeepney to his right to
22
prevent an accident. The speed at which the approaching bus was
running prevented David Ico from swerving the jeepney to the
right shoulder of the road in time to avoid the collision. Thus, even
assuming that the jeepney driver perceived the danger a few
seconds before the actual collision, he had no opportunity to avoid
it. This Court has held that the last clear chance doctrine "can
never apply where the party charged is required to act
instantaneously, and if the injury cannot be avoided by the
application of all means at hand after the peril is or should have
been discovered" [Ong v. Metropolitan Water District,
supra].chanrobles.com : virtual law library
Petitioner likewise insists that David Ico was negligent in failing to
observe Section 43 (c), Article III Chapter IV of Republic Act No.
4136 * which provides that the driver of a vehicle entering a
through highway or a stop intersection shall yield the right of way
to all vehicles approaching in either direction on such through
highway.
Petitioners misplaced reliance on the aforesaid law is readily
apparent in this case. The cited law itself provides that it applies
only to vehicles entering a through highway or a stop intersection.
At the time of the accident, the jeepney had already crossed the
intersection and was on its way to Malalam River. Petitioner itself
cited Fe Icos testimony that the accident occurred after the
jeepney had travelled a distance of about two (2) meters from the
point of intersection [Petition p. 10; Rollo, p. 27]. In fact, even the
witness for the petitioner, Leo Marantan, testified that both
vehicles were coming from opposite directions [CA Decision, p. 7;
Rollo, p. 50], clearly indicating that the jeepney had already
crossed the intersection.
Considering the foregoing, the Court finds that the negligence of
petitioners driver in encroaching into the lane of the incoming
jeepney and in failing to return the bus to its own lane immediately
upon seeing the jeepney coming from the opposite direction was
the sole and proximate cause of the accident without which the
collision would not have occurred. There was no supervening or
intervening negligence on the part of the jeepney driver which
would have made the prior negligence of petitioners driver a mere
remote cause of the accident.
II
On the issue of its liability as an employer, petitioner claims that it
had observed the diligence of a good father of a family to prevent
damage, conformably to the last paragraph of Article 2180 of the
Civil Code. Petitioner adduced evidence to show that in hiring its
drivers, the latter are required to have professional drivers license
and police clearance. The drivers must also pass written
examinations, interviews and practical driving tests, and are
required to undergo a six-month training period. Rodrigo San
Pedro, petitioners Training Coordinator, testified on
petitioners policy of conducting regular and continuing training
programs and safety seminars for its drivers, conductors,
inspectors and supervisors at a frequency rate of at least two
(2) seminars a month.
On this point, the Court quotes with approval the following
findings of the trial court which was adopted by the Court of
Appeals in its challenged decision:
When an injury is caused by the negligence of an employee,
there instantly arises a presumption that the employer has
been negligent either in the selection of his employees or in
the supervision over their acts. Although this presumption is
only a disputable presumption which could be overcome by
proof of diligence of a good father of a family, this Court
believes that the evidence submitted by the defendant to show
that it exercised the diligence of a good father of a family in the
case of Ramirez, as a company driver is far from sufficient. No
support evidence has 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 age, his weight and the
fact that he is married or not. Neither are the result of the
written test, psychological and physical test, among other
tests, have been submitted in evidence [sic]. His NBI or police
clearances and clearances from previous employment were
not marked in evidence. No evidence was presented that
Ramirez actually and really attended the seminars. Vital
evidence should have been the certificate of attendance or
certificate of participation or evidence of such participation like
a logbook signed by the trainees when they attended the
seminars. If such records are not available, the testimony of
the classmates that Ramirez was their classmate in said
seminar (should have been presented) [CA Decision, pp. 8-9;
Rollo, pp. 51-52].
Petitioner contends that the fact that Ambrosio Ramirez was
employed and remained as its driver only means that he
underwent the same rigid selection process and was
subjected to 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 recruitment procedure and company
polices on safety and efficiency [Petition, p. 20; Rollo, p. 37].
The Court finds the above contention unmeritorious.
The finding of negligence on the part of its driver Ambrosio
Ramirez gave rise to the presumption of negligence on the part of
petitioner and the burden of proving that it exercised due diligence
not only in the selection of its employees but also in adequately
supervising their work rests with the petitioner [Lilius v. Manila
Railroad Company, 59 Phil. 758 (1934); Umali v. Bacani, G.R. No.
L-40570, June 30, 1976, 69 SCRA 623]. Contrary to petitioners
claim, there is no presumption that the usual recruitment
procedures and safety standards were observed. The mere
issuance of rules and regulations and the formulation of various
company policies on safety, without showing that they are being
complied with, are not sufficient to exempt petitioner from liability
arising from the negligence of its employee. It is incumbent upon
petitioner to show that in recruiting and employing the erring
driver, the recruitment procedures and company policies on
efficiency and safety were followed. Petitioner failed to do this.
Hence, the Court finds no cogent reason to disturb the finding of
both the trial court and the Court of Appeals that the evidence
presented by the petitioner, which consists mainly of the
uncorroborated testimony of its Training Coordinator, is insufficient
to overcome the presumption of negligence against
petitioner.cralawnad
III
On the question of damages, petitioner claims that the Court of
Appeals erred in fixing the damages for the loss of earning
capacity of the deceased victims. Petitioner assails respondent
courts findings because no documentary evidence in support
thereof, such as income tax returns, pay-rolls, pay slips or
invoices obtained in the usual course of business, were presented
[Petition, p. 22; Rollo, p. 39]. Petitioner argues that the "bare and
self-serving testimonies of the wife of the deceased David Ico and
the mother of the deceased Marilyn Baesa . . . have no probative
value to sustain in law the Court of Appeals conclusion on the
respective earnings of the deceased victims." [Petition, pp. 21-22;
Rollo, pp. 38-39.] It is petitioners contention that the evidence
presented by the private respondent does not meet the
requirements of clear and satisfactory evidence to prove actual
and compensatory damages.
The Court finds that the Court of Appeals committed no reversible
error in fixing the amount of damages for the loss of earning
capacity of the deceased victims. While it is true that private
respondents should have presented documentary evidence to
support their claim for damages for loss of earning capacity of the
deceased victims, the absence thereof does not necessarily bar
the recovery of the damages in question. The testimony of Fe Ico
23
and Francisca Bascos as to the earning capacity of David Ico, and
the spouses Baesa, respectively, are sufficient to establish a basis
from which the court can make a fair and reasonable estimate of
the damages for the loss of earning capacity of the three
deceased victims. Moreover, in fixing the damages for loss of
earning capacity of a deceased victim, the court can consider the
nature of his occupation, his educational attainment and the state
of his health at the time of death.
In the instant case, David Ico was thirty eight (38) years old at the
time of his death in 1981 and was driving his own passenger
jeepney. The spouses Ceasar and Marilyn Baesa were both thirty
(30) years old at the time of their death. Ceasar Baesa was a
commerce degree holder and the proprietor of the Cauayan
Press, printer of the Cauayan Valley Newspaper and the Valley
Times at Cauayan, Isabela. Marilyn Baesa graduated as a nurse
in 1976 and at the time of her death, was the company nurse,
personnel manager, treasurer and cashier of the Ilagan Press at
Ilagan, Isabela. Respondent court duly considered these factors,
together with the uncontradicted testimonies of Fe Ico and
Francisca Bascos, in fixing the amount of damages for the loss of
earning capacity of David Ico and the spouses
Baesa.chanrobles.com:
However, it should be pointed out that the Court of Appeals
committed error in fixing the compensatory damages for the death
of Harold Jim Baesa and Marcelino Baesa. Respondent court
awarded to plaintiff (private respondent) Maricar Baesa Thirty
Thousand Pesos (P30,000.00) as "compensatory damages for the
death of Harold Jim Baesa and Marcelino Baesa." [CA Decision,
p. 14; Rollo, 57]. In other words, the Court of Appeals awarded
only Fifteen Thousand Pesos (P15,000.00) as indemnity for the
death of Harold Jim Baesa and another Fifteen Thousand Pesos
(P15,000.00) for the death of Marcelino Baesa. This is clearly
erroneous. In the case of People v. de la Fuente, G.R. Nos.
63251-52, December 29, 1983, 126 SCRA 518, the indemnity for
the death of a person was fixed by this Court at Thirty Thousand
Pesos (P30,000.00). Plaintiff Maricar Baesa should therefore be
awarded Sixty Thousand Pesos (P60,000.00) as indemnity for the
death of her brothers, Harold Jim Baesa and Marcelino Baesa or
Thirty Thousand Pesos (P30,000.00) for the death of each
brother.
The other items of damages awarded by respondent court which
were not challenged by the petitioner are hereby affirmed.
WHEREFORE, premises considered, the petition is DENIED, and
the decision of respondent Court of Appeals is hereby AFFIRMED
with the modification that the amount of compensatory damages
for the death of Harold Jim Baesa and Marcelino Baesa are
increased to Thirty Thousand Pesos (P30,000.00) each.
SO ORDERED.
PICART vs. SMITH
D. RES IPSA LOQUITOR (ART. 2179)
G.R. No. L-12986 March 31, 1966
THE SPOUSES BERNABE AFRICA and SOLEDAD C.
AFRICA, and the HEIRS OF DOMINGA ONG, petitioners-
appellants,
vs.
CALTEX (PHIL.), INC., MATEO BOQUIREN and THE
COURT OF APPEALS, respondents-appellees.
Ross, Selph, Carrascoso and Janda for the respondents.
Bernabe Africa, etc. for the petitioners.
MAKALINTAL., J.:
This case is before us on a petition for review of the decision
of the Court of Appeals, which affirmed that of the Court of
First Instance of Manila dismissing petitioners' second
amended complaint against respondents.
The action is for damages under Articles 1902 and 1903 of the
old Civil Code. It appears that in the afternoon of March 18,
1948 a fire broke out at the Caltex service station at the corner
of Antipolo street and Rizal Avenue, Manila. It started while
gasoline was being hosed from a tank truck into the
underground storage, right at the opening of the receiving tank
where the nozzle of the hose was inserted. The fire spread to
and burned several neighboring houses, including the
personal properties and effects inside them. Their owners,
among them petitioners here, sued respondents Caltex (Phil.),
Inc. and Mateo Boquiren, the first as alleged owner of the
station and the second as its agent in charge of operation.
Negligence on the part of both of them was attributed as the
cause of the fire.
The trial court and the Court of Appeals found that petitioners
failed to prove negligence and that respondents had exercised
due care in the premises and with respect to the supervision of
their employees.
The first question before Us refers to the admissibility of
certain reports on the fire prepared by the Manila Police and
Fire Departments and by a certain Captain Tinio of the Armed
Forces of the Philippines. Portions of the first two reports are as
follows:
1. Police Department report:
Investigation disclosed that at about 4:00 P.M. March 18, 1948,
while Leandro Flores was transferring gasoline from a tank truck,
plate No. T-5292 into the underground tank of the Caltex Gasoline
Station located at the corner of Rizal Avenue and Antipolo Street,
this City, an unknown Filipino lighted a cigarette and threw the
burning match stick near the main valve of the said underground
tank. Due to the gasoline fumes, fire suddenly blazed. Quick
action of Leandro Flores in pulling off the gasoline hose
connecting the truck with the underground tank prevented a
terrific explosion. However, the flames scattered due to the hose
from which the gasoline was spouting. It burned the truck and the
following accessorias and residences.
2. The Fire Department report:
In connection with their allegation that the premises was (sic)
subleased for the installation of a coca-cola and cigarette stand,
the complainants furnished this Office a copy of a photograph
taken during the fire and which is submitted herewith. it appears in
this picture that there are in the premises a coca-cola cooler and a
rack which according to information gathered in the neighborhood
contained cigarettes and matches, installed between the gasoline
pumps and the underground tanks.
The report of Captain Tinio reproduced information given by a
certain Benito Morales regarding the history of the gasoline
station and what the chief of the fire department had told him on
the same subject.
The foregoing reports were ruled out as "double hearsay" by the
Court of Appeals and hence inadmissible. This ruling is now
assigned as error. It is contended: first, that said reports were
admitted by the trial court without objection on the part of
respondents; secondly, that with respect to the police report
(Exhibit V-Africa) which appears signed by a Detective Zapanta
allegedly "for Salvador Capacillo," the latter was presented as
witness but respondents waived their right to cross-examine him
although they had the opportunity to do so; and thirdly, that in any
event the said reports are admissible as an exception to the
hearsay rule under section 35 of Rule 123, now Rule 130.
The first contention is not borne out by the record. The transcript
of the hearing of September 17, 1953 (pp. 167-170) shows that
the reports in question, when offered as evidence, were objected
to by counsel for each of respondents on the ground that they
were hearsay and that they were "irrelevant, immaterial and
impertinent." Indeed, in the court's resolution only Exhibits J, K, K-
24
5 and X-6 were admitted without objection; the admission of the
others, including the disputed ones, carried no such explanation.
On the second point, although Detective Capacillo did take the
witness stand, he was not examined and he did not testify as to
the facts mentioned in his alleged report (signed by Detective
Zapanta). All he said was that he was one of those who
investigated "the location of the fire and, if possible, gather
witnesses as to the occurrence, and that he brought the report
with him. There was nothing, therefore, on which he need be
cross-examined; and the contents of the report, as to which he did
not testify, did not thereby become competent evidence. And even
if he had testified, his testimony would still have been
objectionable as far as information gathered by him from third
persons was concerned.
Petitioners maintain, however, that the reports in themselves, that
is, without further testimonial evidence on their contents, fall within
the scope of section 35, Rule 123, which provides that "entries in
official records made in the performance of his duty by a public
officer of the Philippines, or by a person in the performance of a
duty specially enjoined by law, are prima facie evidence of the
facts therein stated."
There are three requisites for admissibility under the rule just
mentioned: (a) that the entry was made by a public officer, or by
another person specially enjoined by law to do so; (b) that it was
made by the public officer in the performance of his duties, or by
such other person in the performance of a duty specially enjoined
by law; and (c) that the public officer or other person had sufficient
knowledge of the facts by him stated, which must have been
acquired by him personally or through official information (Moran,
Comments on the Rules of Court, Vol. 3 [1957] p. 398).
Of the three requisites just stated, only the last need be
considered here. Obviously the material facts recited in the reports
as to the cause and circumstances of the fire were not within the
personal knowledge of the officers who conducted the
investigation. Was knowledge of such facts, however, acquired by
them through official information? As to some facts the sources
thereof are not even identified. Others are attributed to Leopoldo
Medina, referred to as an employee at the gas station were the
fire occurred; to Leandro Flores, driver of the tank truck from
which gasoline was being transferred at the time to the
underground tank of the station; and to respondent Mateo
Boquiren, who could not, according to Exhibit V-Africa, give any
reason as to the origin of the fire. To qualify their statements as
"official information" acquired by the officers who prepared the
reports, the persons who made the statements not only must have
personal knowledge of the facts stated but must have the duty to
give such statements for record.1
The reports in question do not constitute an exception to the
hearsay rule; the facts stated therein were not acquired by the
reporting officers through official information, not having been
given by the informants pursuant to any duty to do so.
The next question is whether or not, without proof as to the
cause and origin of the fire, the doctrine of res ipsa
loquitur should apply so as to presume negligence on the part
of appellees. Both the trial court and the appellate court
refused to apply the doctrine in the instant case on the
grounds that "as to (its) applicability ... in the Philippines, there
seems to he nothing definite," and that while the rules do not
prohibit its adoption in appropriate cases, "in the case at bar,
however, we find no practical use for such doctrine." The
question deserves more than such summary dismissal. The
doctrine has actually been applied in this jurisdiction, in the
case of Espiritu vs. Philippine Power and Development Co.
(CA-G.R. No. 3240-R, September 20, 1949), wherein the
decision of the Court of Appeals was penned by Mr. Justice
J.B.L. Reyes now a member of the Supreme Court.
The facts of that case are stated in the decision as follows:
In the afternoon of May 5, 1946, while the plaintiff-appellee
and other companions were loading grass between the
municipalities of Bay and Calauan, in the province of Laguna,
with clear weather and without any wind blowing, an electric
transmission wire, installed and maintained by the defendant
Philippine Power and Development Co., Inc. alongside the
road, suddenly parted, and one of the broken ends hit the
head of the plaintiff as he was about to board the truck. As a
result, plaintiff received the full shock of 4,400 volts carried by
the wire and was knocked unconscious to the ground. The
electric charge coursed through his body and caused
extensive and serious multiple burns from skull to legs, leaving
the bone exposed in some parts and causing intense pain and
wounds that were not completely healed when the case was
tried on June 18, 1947, over one year after the mishap.
The defendant therein disclaimed liability on the ground that
the plaintiff had failed to show any specific act of negligence,
but the appellate court overruled the defense under the
doctrine of res ipsa loquitur. The court said:
The first point is directed against the sufficiency of plaintiff's
evidence to place appellant on its defense. While it is the rule,
as contended by the appellant, that in case of noncontractual
negligence, or culpa aquiliana, the burden of proof is on the
plaintiff to establish that the proximate cause of his injury was
the negligence of the defendant, it is also a recognized
principal that "where the thing which caused injury, without
fault of the injured person, is under the exclusive control of the
defendant and the injury is such as in the ordinary course of
things does not occur if he having such control use proper care, it
affords reasonable evidence, in the absence of the explanation,
that the injury arose from defendant's want of care."
And the burden of evidence is shifted to him to establish that he
has observed due care and diligence. (San Juan Light & Transit
Co. v. Requena, 244, U.S. 89, 56 L. ed. 680.) This rule is known
by the name of res ipsa loquitur (the transaction speaks for itself),
and is peculiarly applicable to the case at bar, where it is
unquestioned that the plaintiff had every right to be on the
highway, and the electric wire was under the sole control of
defendant company. In the ordinary course of events, electric
wires do not part suddenly in fair weather and injure people,
unless they are subjected to unusual strain and stress or there are
defects in their installation, maintenance and supervision; just as
barrels do not ordinarily roll out of the warehouse windows to
injure passersby, unless some one was negligent. (Byrne v.
Boadle, 2 H & Co. 722; 159 Eng. Reprint 299, the leading case
that established that rule). Consequently, in the absence of
contributory negligence (which is admittedly not present), the fact
that the wire snapped suffices to raise a reasonable presumption
of negligence in its installation, care and maintenance. Thereafter,
as observed by Chief Baron Pollock, "if there are any facts
inconsistent with negligence, it is for the defendant to prove."
It is true of course that decisions of the Court of Appeals do not
lay down doctrines binding on the Supreme Court, but we do not
consider this a reason for not applying the particular doctrine
of res ipsa loquitur in the case at bar. Gasoline is a highly
combustible material, in the storage and sale of which extreme
care must be taken. On the other hand, fire is not considered a
fortuitous event, as it arises almost invariably from some act of
man. A case strikingly similar to the one before Us is Jones vs.
Shell Petroleum Corporation, et al., 171 So. 447:
Arthur O. Jones is the owner of a building in the city of Hammon
which in the year 1934 was leased to the Shell Petroleum
Corporation for a gasoline filling station. On October 8, 1934,
during the term of the lease, while gasoline was being transferred
from the tank wagon, also operated by the Shell Petroleum
Corporation, to the underground tank of the station, a fire started
with resulting damages to the building owned by Jones. Alleging
that the damages to his building amounted to $516.95, Jones
sued the Shell Petroleum Corporation for the recovery of that
amount. The judge of the district court, after hearing the
testimony, concluded that plaintiff was entitled to a recovery and
rendered judgment in his favor for $427.82. The Court of Appeals
for the First Circuit reversed this judgment, on the ground the
testimony failed to show with reasonable certainty any negligence
on the part of the Shell Petroleum Corporation or any of its agents
25
or employees. Plaintiff applied to this Court for a Writ of Review
which was granted, and the case is now before us for
decision.1wph1.t
In resolving the issue of negligence, the Supreme Court of
Louisiana held:
Plaintiff's petition contains two distinct charges of negligence
one relating to the cause of the fire and the other relating to the
spreading of the gasoline about the filling station.
Other than an expert to assess the damages caused plaintiff's
building by the fire, no witnesses were placed on the stand by the
defendant.
Taking up plaintiff's charge of negligence relating to the cause of
the fire, we find it established by the record that the filling station
and the tank truck were under the control of the defendant and
operated by its agents or employees. We further find from the
uncontradicted testimony of plaintiff's witnesses that fire started in
the underground tank attached to the filling station while it was
being filled from the tank truck and while both the tank and the
truck were in charge of and being operated by the agents or
employees of the defendant, extended to the hose and tank truck,
and was communicated from the burning hose, tank truck, and
escaping gasoline to the building owned by the plaintiff.
Predicated on these circumstances and the further circumstance
of defendant's failure to explain the cause of the fire or to show its
lack of knowledge of the cause, plaintiff has evoked the doctrine
of res ipsa loquitur. There are many cases in which the doctrine
may be successfully invoked and this, we think, is one of them.
Where the thing which caused the injury complained of is shown
to be under the management of defendant or his servants and the
accident is such as in the ordinary course of things does not
happen if those who have its management or control use proper
care, it affords reasonable evidence, in absence of explanation by
defendant, that the accident arose from want of care. (45 C.J.
#768, p. 1193).
This statement of the rule of res ipsa loquitur has been widely
approved and adopted by the courts of last resort. Some of the
cases in this jurisdiction in which the doctrine has been applied
are the following, viz.: Maus v. Broderick, 51 La. Ann. 1153, 25 So.
977; Hebert v. Lake Charles Ice, etc., Co., 111 La. 522, 35 So.
731, 64 L.R.A. 101, 100 Am. St. Rep. 505; Willis v. Vicksburg, etc.,
R. Co., 115 La. 63, 38 So. 892; Bents v. Page, 115 La. 560, 39 So.
599.
The principle enunciated in the aforequoted case applies with
equal force here. The gasoline station, with all its appliances,
equipment and employees, was under the control of appellees. A
fire occurred therein and spread to and burned the
neighboring houses. The persons who knew or could have
known how the fire started were appellees and their
employees, but they gave no explanation thereof whatsoever.
It is a fair and reasonable inference that the incident happened
because of want of care.
In the report submitted by Captain Leoncio Mariano of the
Manila Police Department (Exh. X-1 Africa) the following
appears:
Investigation of the basic complaint disclosed that the Caltex
Gasoline Station complained of occupies a lot approximately
10 m x 10 m at the southwest corner of Rizal Avenue and
Antipolo. The location is within a very busy business district
near the Obrero Market, a railroad crossing and very thickly
populated neighborhood where a great number of people mill
around t
until
gasoline
tever be theWactjvities of these peopleor lighting a cigarette
cannot be excluded and this constitute a secondary hazard to
its operation which in turn endangers the entire neighborhood
to conflagration.
Furthermore, aside from precautions already taken by its
operator the concrete walls south and west adjoining the
neighborhood are only 2-1/2 meters high at most and cannot
avoid the flames from leaping over it in case of fire.
Records show that there have been two cases of fire which
caused not only material damages but desperation and also
panic in the neighborhood.
Although the soft drinks stand had been eliminated, this
gasoline service station is also used by its operator as a
garage and repair shop for his fleet of taxicabs numbering ten
or more, adding another risk to the possible outbreak of fire at
this already small but crowded gasoline station.
The foregoing report, having been submitted by a police officer
in the performance of his duties on the basis of his own
personal observation of the facts reported, may properly be
considered as an exception to the hearsay rule. These facts,
descriptive of the location and objective circumstances
surrounding the operation of the gasoline station in question,
strengthen the presumption of negligence under the doctrine
of res ipsa loquitur, since on their face they called for more
stringent measures of caution than those which would satisfy
the standard of due diligence under ordinary circumstances.
There is no more eloquent demonstration of this than the
statement of Leandro Flores before the police investigator. Flores
was the driver of the gasoline tank wagon who, alone and without
assistance, was transferring the contents thereof into the
underground storage when the fire broke out. He said: "Before
loading the underground tank there were no people, but while the
loading was going on, there were people who went to drink coca-
cola (at the coca-cola stand) which is about a meter from the hole
leading to the underground tank." He added that when the tank
was almost filled he went to the tank truck to close the valve, and
while he had his back turned to the "manhole" he, heard someone
shout "fire."
Even then the fire possibly would not have spread to the
neighboring houses were it not for another negligent omission on
the part of defendants, namely, their failure to provide a concrete
wall high enough to prevent the flames from leaping over it. As it
was the concrete wall was only 2-1/2 meters high, and beyond
that height it consisted merely of galvanized iron sheets, which
would predictably crumple and melt when subjected to intense
heat. Defendants' negligence, therefore, was not only with respect
to the cause of the fire but also with respect to the spread thereof
to the neighboring houses.
There is an admission on the part of Boquiren in his amended
answer to the second amended complaint that "the fire was
caused through the acts of a stranger who, without authority, or
permission of answering defendant, passed through the gasoline
station and negligently threw a lighted match in the premises." No
evidence on this point was adduced, but assuming the allegation
to be true certainly any unfavorable inference from the
admission may be taken against Boquiren it does not
extenuate his negligence. A decision of the Supreme Court of
Texas, upon facts analogous to those of the present case, states
the rule which we find acceptable here. "It is the rule that those
who distribute a dangerous article or agent, owe a degree of
protection to the public proportionate to and commensurate with a
danger involved ... we think it is the generally accepted rule as
applied to torts that 'if the effects of the actor's negligent conduct
actively and continuously operate to bring about harm to another,
the fact that the active and substantially simultaneous operation of
the effects of a third person's innocent, tortious or criminal act is
also a substantial factor in bringing about the harm, does not
protect the actor from liability.' (Restatement of the Law of Torts,
vol. 2, p. 1184, #439). Stated in another way, "The intention of an
unforeseen and unexpected cause, is not sufficient to relieve a
wrongdoer from consequences of negligence, if such negligence
directly and proximately cooperates with the independent cause in
the resulting injury." (MacAfee, et al. vs. Traver's Gas Corporation,
153 S.W. 2nd 442.)
26
The next issue is whether Caltex should be held liable for the
damages caused to appellants. This issue depends on whether
Boquiren was an independent contractor, as held by the Court of
Appeals, or an agent of Caltex. This question, in the light of the
facts not controverted, is one of law and hence may be passed
upon by this Court. These facts are: (1) Boquiren made an
admission that he was an agent of Caltex; (2) at the time of the
fire Caltex owned the gasoline station and all the equipment
therein; (3) Caltex exercised control over Boquiren in the
management of the state; (4) the delivery truck used in delivering
gasoline to the station had the name of CALTEX painted on it; and
(5) the license to store gasoline at the station was in the name of
Caltex, which paid the license fees. (Exhibit T-Africa; Exhibit U-
Africa; Exhibit X-5 Africa; Exhibit X-6 Africa; Exhibit Y-Africa).
In Boquiren's amended answer to the second amended complaint,
he denied that he directed one of his drivers to remove gasoline
from the truck into the tank and alleged that the "alleged driver, if
one there was, was not in his employ, the driver being an
employee of the Caltex (Phil.) Inc. and/or the owners of the
gasoline station." It is true that Boquiren later on amended his
answer, and that among the changes was one to the effect that he
was not acting as agent of Caltex. But then again, in his motion to
dismiss appellants' second amended complaint the ground alleged
was that it stated no cause of action since under the allegations
thereof he was merely acting as agent of Caltex, such that he
could not have incurred personal liability. A motion to dismiss on
this ground is deemed to be an admission of the facts alleged in
the complaint.
Caltex admits that it owned the gasoline station as well as the
equipment therein, but claims that the business conducted at the
service station in question was owned and operated by Boquiren.
But Caltex did not present any contract with Boquiren that would
reveal the nature of their relationship at the time of the fire. There
must have been one in existence at that time. Instead, what was
presented was a license agreement manifestly tailored for
purposes of this case, since it was entered into shortly before the
expiration of the one-year period it was intended to operate. This
so-called license agreement (Exhibit 5-Caltex) was executed on
November 29, 1948, but made effective as of January 1, 1948 so
as to cover the date of the fire, namely, March 18, 1948. This
retroactivity provision is quite significant, and gives rise to the
conclusion that it was designed precisely to free Caltex from any
responsibility with respect to the fire, as shown by the clause that
Caltex "shall not be liable for any injury to person or property while
in the property herein licensed, it being understood and agreed
that LICENSEE (Boquiren) is not an employee, representative or
agent of LICENSOR (Caltex)."
But even if the license agreement were to govern, Boquiren
can hardly be considered an independent contractor. Under
that agreement Boquiren would pay Caltex the purely nominal
sum of P1.00 for the use of the premises and all the
equipment therein. He could sell only Caltex Products.
Maintenance of the station and its equipment was subject to
the approval, in other words control, of Caltex. Boquiren could
not assign or transfer his rights as licensee without the
consent of Caltex. The license agreement was supposed to be
from January 1, 1948 to December 31, 1948, and thereafter
until terminated by Caltex upon two days prior written notice.
Caltex could at any time cancel and terminate the agreement
in case Boquiren ceased to sell Caltex products, or did not
conduct the business with due diligence, in the judgment of
Caltex. Termination of the contract was therefore a right
granted only to Caltex but not to Boquiren. These provisions of
the contract show the extent of the control of Caltex over
Boquiren. The control was such that the latter was virtually an
employee of the former.
Taking into consideration the fact that the operator owed his
position to the company and the latter could remove him or
terminate his services at will; that the service station belonged
to the company and bore its tradename and the operator sold
only the products of the company; that the equipment used by
the operator belonged to the company and were just loaned to
the operator and the company took charge of their repair and
maintenance; that an employee of the company supervised
the operator and conducted periodic inspection of the
company's gasoline and service station; that the price of the
products sold by the operator was fixed by the company and
not by the operator; and that the receipts signed by the
operator indicated that he was a mere agent, the finding of the
Court of Appeals that the operator was an agent of the
company and not an independent contractor should not be
disturbed.
To determine the nature of a contract courts do not have or are
not bound to rely upon the name or title given it by the
contracting parties, should thereby a controversy as to what
they really had intended to enter into, but the way the
contracting parties do or perform their respective obligations
stipulated or agreed upon may be shown and inquired into,
and should such performance conflict with the name or title
given the contract by the parties, the former must prevail over
the latter. (Shell Company of the Philippines, Ltd. vs.
Firemens' Insurance Company of Newark, New Jersey, 100
Phil. 757).
The written contract was apparently drawn for the purpose of
creating the apparent relationship of employer and
independent contractor, and of avoiding liability for the negligence
of the employees about the station; but the company was not
satisfied to allow such relationship to exist. The evidence shows
that it immediately assumed control, and proceeded to direct the
method by which the work contracted for should be performed. By
reserving the right to terminate the contract at will, it retained the
means of compelling submission to its orders. Having elected to
assume control and to direct the means and methods by which
the work has to be performed, it must be held liable for the
negligence of those performing service under its direction. We
think the evidence was sufficient to sustain the verdict of the jury.
(Gulf Refining Company v. Rogers, 57 S.W. 2d, 183).
Caltex further argues that the gasoline stored in the station
belonged to Boquiren. But no cash invoices were presented to
show that Boquiren had bought said gasoline from Caltex. Neither
was there a sales contract to prove the same.
As found by the trial court the Africas sustained a loss of
P9,005.80, after deducting the amount of P2,000.00 collected by
them on the insurance of the house. The deduction is now
challenged as erroneous on the ground that Article 2207 of the
New Civil Code, which provides for the subrogation of the insurer
to the rights of the insured, was not yet in effect when the loss
took place. However, regardless of the silence of the law on this
point at that time, the amount that should be recovered be
measured by the damages actually suffered, otherwise the
principle prohibiting unjust enrichment would be violated. With
respect to the claim of the heirs of Ong P7,500.00 was adjudged
by the lower court on the basis of the assessed value of the
property destroyed, namely, P1,500.00, disregarding the
testimony of one of the Ong children that said property was worth
P4,000.00. We agree that the court erred, since it is of common
knowledge that the assessment for taxation purposes is not an
accurate gauge of fair market value, and in this case should not
prevail over positive evidence of such value. The heirs of Ong are
therefore entitled to P10,000.00.
Wherefore, the decision appealed from is reversed and
respondents-appellees are held liable solidarily to appellants, and
ordered to pay them the aforesaid sum of P9,005.80 and
P10,000.00, respectively, with interest from the filing of the
complaint, and costs.
[G.R. No. 132607. May 5, 1999]
CEBU SHIPYARD AND ENGINEERING WORKS,
INC., petitioner, vs. WILLIAM LINES, INC. and PRUDENTIAL
GUARANTEE and ASSURANCE COMPANY,
INC., respondents.
27
DECISION
PURISIMA, J.:
At bar is a Petition for Review on Certiorari under Rule 45 of the
Revised Rules of Court seeking a reversal of the decision of the
Court of Appeals[1] which affirmed the decision of the trial court of
origin finding the petitioner herein, Cebu Shipyard and
Engineering Works, Inc. (CSEW) negligent and liable for
damages to the private respondent, William Lines, Inc., and to the
insurer, Prudential Guarantee Assurance Company, Inc.
The antecedent facts that matter are as follows:
Cebu Shipyard and Engineering Works, Inc. (CSEW) is a
domestic corporation engaged in the business of dry-docking and
repairing of marine vessels while the private respondent,
Prudential Guarantee and Assurance, Inc. (Prudential), also a
domestic corporation is in the non-life insurance business.
William Lines, Inc. (plaintiff below) is in the shipping business. It
was the owner of M/V Manila City, a luxury passenger-cargo
vessel, which caught fire and sank on February 16, 1991. At the
time of the unfortunate occurrence sued upon, subject vessel was
insured with Prudential for P45,000,000.00 pesos for hull and
machinery. The Hull Policy included an Additional Perils
(INCHMAREE) Clause covering loss of or damage to the vessel
through the negligence of, among others, ship repairmen. The
Policy provided as follows:
Subject to the conditions of this Policy, this insurance also covers
loss of or damage to Vessel directly caused by the following:
xxx
Negligence of Charterers and/or Repairers, provided such
Charterers and/or Repairers are not an Assured hereunder.
xxx
provided such loss or damage has not resulted from want of due
diligence by the Assured, the Owners or Managers of the Vessel,
of any of them. Masters, Officers, Crew or Pilots are not to be
considered Owners within the meaning of this Clause should they
hold shares in the Vessel.[2]
Petitioner CSEW was also insured by Prudential for third party
liability under a Shiprepairers Legal Liability Insurance Policy. The
policy was for P10 million only, under the limited liability clause, to
wit:
7. Limit of Liability
The limit of liability under this insurance, in respect of any one
accident or series of accidents, arising out of one occurrence,
shall be [P10 million], including liability for costs and expense
which are either:
(a) incurred with the written consent of the underwriters
hereon; or
(b) awarded against the Assured.[3]
On February 5, 1991, William Lines, Inc. brought its vessel,
M/V Manila City, to the Cebu Shipyard in Lapulapu City for
annual dry-docking and repair.
On February 6, 1991, an arrival conference was held between
representatives of William Lines, Inc. and CSEW to discuss
the work to be undertaken on the M/V Manila City.
The contracts, denominated as Work Orders, were signed
thereafter, with the following stipulations:
10. The Contractor shall replace at its own work and at its own
cost any work or material which can be shown to be defective
and which is communicated in writing within one (1) month of
redelivery of the vessel or if the vessel was not in the
Contractors Possession, the withdrawal of the Contractors
workmen, or at its option to pay a sum equal to the cost of
such replacement at its own works. These conditions shall
apply to any such replacements.
11. Save as provided in Clause 10, the Contractor shall not be
under any liability to the Customer either in contract or for
delict or quasi-delict or otherwise except for negligence and
such liability shall itself be subject to the following overriding
limitations and exceptions, namely:
(a) The total liability of the Contractor to the Customer (over
and above the liability to replace under Clause 10) or of any
sub-contractor shall be limited in respect of any defect or
event (and a series of accidents arising out of the same defect
or event shall constitute one defect or event) to the sum of
Pesos Philippine Currency One Million only.
(b) In no circumstance whatsoever shall the liability of the
Contractor or any Sub-Contractor include any sum in respect
of loss of profit or loss of use of the vessel or damages
consequential on such loss of use.
xxx
20. The insurance on the vessel should be maintained by the
customer and/or owner of the vessel during the period the
contract is in effect.[4]
While the M/V Manila City was undergoing dry-docking and
repairs within the premises of CSEW, the master, officers and
crew of M/V Manila City stayed in the vessel, using their
cabins as living quarters. Other employees hired by William Lines
to do repairs and maintenance work on the vessel were also
present during the dry-docking.
On February 16, 1991, after subject vessel was transferred to the
docking quay, it caught fire and sank, resulting to its eventual total
loss.
On February 21, 1991, William Lines, Inc. filed a complaint for
damages against CSEW, alleging that the fire which broke out in
M/V Manila City was caused by CSEWs negligence and lack of
care.
On July 15, 1991 was filed an Amended Complaint impleading
Prudential as co-plaintiff, after the latter had paid William Lines,
Inc. the value of the hull and machinery insurance on the M/V
Manila City. As a result of such payment Prudential was
subrogated to the claim of P45 million, representing the value of
the said insurance it paid.
On June 10, 1994, the trial court a quo came out with a judgment
against CSEW, disposing as follows:
WHEREFORE, judgment is hereby rendered in favor of the
plaintiffs and against the defendant, ordering the latter:
1. To pay unto plaintiff Prudential Guarantee and Assurance, Inc.,
the subrogee, the amount of Forty-five Million (P45 million) Pesos,
with interest at the legal rate until full payment is made;
2. To pay unto plaintiff, William Lines, Inc., the amount of Fifty-six
Million Seven Hundred Fifteen Thousand (P56,715,000.00) Pesos
representing loss of income of M/V MANILA CITY, with interest at
the legal rate until full payment is made;
3. To pay unto plaintiff, William Lines, Inc. the amount of Eleven
Million (P11 million) as payment, in addition to what it received
from the insurance company to fully cover the injury or loss, in
order to replace the M/V MANILA CITY, with interest at the legal
rate until full payment is made;
4. To pay unto plaintiff, William Lines, Inc. the sum of Nine
Hundred Twenty-Seven Thousand Thirty-nine (P927,039.00)
Pesos for the loss of fuel and lub (sic) oil on board the vessel
when she was completely gutted by fire at defendant, Cebu
Shipyards quay, with interest at the legal rate until full payment is
made;
5. To pay unto plaintiff, William Lines, Inc. the sum of Three Million
Fifty-four Thousand Six Hundred Seventy-seven Pesos and
Ninety-five centavos (P3,054,677.95) as payment for the
spare parts and materials used in the M/V MANILA CITY during
dry-docking with interest at the legal rate until full payment is
made;
28
6. To pay unto plaintiff William Lines, Inc. the sum of Five Hundred
Thousand (P500,000.00) Pesos in moral damages;
7. To pay unto plaintiff, William Lines, Inc. the amount of Ten
Million (P10,000,000.00) Pesos in attorneys fees; and to pay the
costs of this suit.
CSEW (defendant below) appealed the aforesaid decision to the
Court of Appeals. During the pendency of the appeal, CSEW and
William Lines presented a Joint Motion for Partial Dismissal with
prejudice, on the basis of the amicable settlement inked between
Cebu Shipyard and William Lines only.
On July 31, 1996, the Court of Appeals ordered the partial
dismissal of the case insofar as CSEW and William Lines were
concerned.
On September 3, 1997, the Court of Appeals affirmed the
appealed decision of the trial court, ruling thus:
WHEREFORE, the judgment of the lower court ordering the
defendant, Cebu Shipyard and Engineering Works, Inc. to pay the
plaintiff Prudential Guarantee and Assurance, Inc., the subrogee,
the sum of P45 Million, with interest at the legal rate until full
payment is made, as contained in the decision of Civil Case No.
CEB-9935 is hereby AFFIRMED.
With the denial of its motion for reconsideration by the Court of
Appeals Resolution dated February 13, 1998, CSEW found its
way to this court via the present petition, contending that:
I. THE COURT OF APPEALS COMMITTED REVERSIBLE
ERROR IN HOLDING THAT CSEW HAD MANAGEMENT AND
SUPERVISORY CONTROL OF THE M/V MANILA CITY AT THE
TIME THE FIRE BROKE OUT.
II. THE COURT OF APPEALS COMMITTED REVERSIBLE
ERROR IN APPLYING THE DOCTRINE OF RES IPSA
LOQUITUR AGAINST CSEW.
III. THE COURT OF APPEALS RULING HOLDING CSEW
NEGLIGENT AND THEREBY LIABLE FOR THE LOSS OF THE
M/V MANILA CITY IS BASED ON FINDINGS OF FACT NOT
SUPPORTED BY EVIDENCE.
IV. THE COURT OF APPEALS COMMITTED A REVERSIBLE
ERROR IN RULING CSEWS EXPERT EVIDENCE AS
INADMISSIBLE OR OF NO PROBATIVE VALUE.
V. THE COURT OF APPEALS COMMITTED A REVERSIBLE
ERROR IN RULING THAT PRUDENTIAL HAS THE RIGHT OF
SUBROGATION AGAINST ITS OWN INSURED.
VI. ASSUMING ARGUENDO THAT PRUDENTIAL HAS THE
RIGHT OF SUBROGATION AND THAT CSEW WAS NEGLIGENT
IN THE PERFORMANCE OF ITS OBLIGATIONS UNDER
THE SHIPREPAIR CONTRACTS, THE COURT OF APPEALS
COMMITTED A REVERSIBLE ERROR IN HOLDING THAT
THE CONTRACTUAL PROVISIONS LIMITING CSEWS
LIABILITY FOR NEGLIGENCE TO A MAXIMUM OF P1
MILLION IS NOT VALID, CONTRARY TO THE APPLICABLE
RULINGS OF THIS HONORABLE COURT.
Petitioners version of the events that led to the fire runs as
follows:
On February 13, 1991, the CSEW completed the drydocking
of M/V Manila City at its grave dock. It was then transferred to
the docking quay of CSEW where the remaining repair to be
done was the replating of the top of Water Ballast Tank No. 12
(Tank Top No. 12) which was subcontracted by CSEW to JNB
General Services. Tank Top No. 12 was at the rear section of
the vessel, on level with the flooring of the crew cabins located
on the vessels second deck.
At around seven o clock in the morning of February 16, 1991,
the JNB workers trimmed and cleaned the tank top framing
which involved minor hotworks (welding/cutting works). The
said work was completed at about 10:00 a. m. The JNB
workers then proceeded to rig the steel plates, after which
they had their lunch break. The rigging was resumed at 1:00
p.m.
While in the process of rigging the second steel plate, the JNB
workers noticed smoke coming from the passageway along
the crew cabins. When one of the workers, Mr. Casas,
proceeded to the passageway to ascertain the origin of the
smoke, he noticed that smoke was gathering on the ceiling of
the passageway but did not see any fire as the crew cabins on
either side of the passageway were locked. He immediately
sought out the proprietor of JNB, Mr. Buenavista, and the
Safety Officer of CSEW, Mr. Aves, who sounded the fire
alarm. CSEWs fire brigade immediately responded as well as
the other fire fighting units in Metro Cebu. However, there
were no WLI representative, officer or crew to guide the
firemen inside the vessel.
Despite the combined efforts of the firemen of the Lapulapu
City Fire Department, Mandaue Fire Department, Cordova
Fire Department, Emergency Rescue Unit Foundation, and fire
brigade of CSEW, the fire was not controlled until 2:00 a.m. of
the following day, February 17, 1991.
On the early morning of February 17, 1991, gusty winds
rekindled the flames on the vessel and fire again broke
out. Then the huge amounts of water pumped into the vessel,
coupled with the strong current, caused the vessel to tilt until it
capsized and sank
When M/V Manila City capsized, steel and angle bars were
noticed to have been newly welded along the port side of the hull
of the vessel, at the level of the crew cabins. William Lines did not
previously apply for a permit to do hotworks on the said portion of
the ship as it should have done pursuant to its work order with
CSEW.[5]
Respondent Prudential, on the other hand, theorized that the fire
broke out in the following manner :
At around eleven o clock in the morning of February 16, 1991, the
Chief Mate of M/V Manila City was inspecting the various works
being done by CSEW on the vessel, when he saw that some
workers of CSEW were cropping out steel plates on Tank Top No.
12 using acetylene, oxygen and welding torch. He also observed
that the rubber insulation wire coming out of the air-conditioning
unit was already burning, prompting him to scold the workers.
At 2:45 in the afternoon of the same day, witnesses saw
smoke coming from Tank No. 12. The vessels reeferman reported
such occurence to the Chief Mate who immediately assembled
the crew members to put out the fire. When it was too hot for them
to stay on board and seeing that the fire cannot be controlled, the
vessels crew were forced to withdraw from CSEWs docking quay.
In the morning of February 17, 1991, M/V Manila City sank. As the
vessel was insured with Prudential Guarantee, William Lines filed
a claim for constructive total loss, and after a thorough
investigation of the surrounding circumstances of the tragedy,
Prudential Guarantee found the said insurance claim to be
meritorious and issued a check in favor of William Lines in the
amount of P45 million pesos representing the total value of M/V
Manila Citys hull and machinery insurance.[6]
The petition is unmeritorious.
Petitioner CSEW faults the Court of Appeals for adjudging it
negligent and liable for damages to the respondents, William
Lines, Inc., and Prudential for the loss of M/V Manila City. It is
petitioners submission that the finding of negligence by the Court
of Appeals is not supported by the evidence on record, and
contrary to what the Court of Appeals found, petitioner did not
have management and control over M/V Manila City. Although it
was brought to the premises of CSEW for annual repair, William
Lines, Inc. retained control over the vessel as the ship captain
remained in command and the ships crew were still present.
While it imposed certain rules and regulations on William Lines, it
was in the exercise of due diligence and not an indication of
CSEWs exclusive control over subject vessel. Thus, CSEW
maintains that it did not have exclusive control over the M/V
Manila City and the trial court and the Court of Appeals erred in
applying the doctrine of res ipsa loquitur.
29
Time and again, this Court had occasion to reiterate the well-
established rule that factual findings by the Court of Appeals are
conclusive on the parties and are not reviewable by this Court.
They are entitled to great weight and respect, even finality,
especially when, as in this case, the Court of Appeals affirmed the
factual findings arrived at by the trial court.[7] When supported by
sufficient evidence, findings of fact by the Court of Appeals
affirming those of the trial court, are not to be disturbed on appeal.
The rationale behind this doctrine is that review of the findings of
fact of theCourt of Appeals is not a function that the Supreme
Court normally undertakes.[8]
Here, the Court of Appeals and the Cebu Regional Trial Court of
origin are agreed that the fire which caused the total loss of
subject M/V Manila City was due to the negligence of the
employees and workers of CSEW. Both courts found that the M/V
Manila City was under the custody and control of petitioner
CSEW, when the ill-fated vessel caught fire. The decisions of both
the lower court and the Court of Appeals set forth clearly the
evidence sustaining their finding of actionable negligence on the
part of CSEW. This factual finding is accorded great weight and is
conclusive on the parties. The court discerns no basis for
disturbing such finding firmly anchored on enough evidence. As
held in the case of Roblett Industrial Construction Corporation vs.
Court of Appeals, in the absence of any showing that the trial court
failed to appreciate facts and circumstances of weight and
substance that would have altered its conclusion, no compelling
reason exists for the Court to impinge upon matters more
appropriately within its province.[9]
Furthermore, in petitions for review on certiorari, only questions of
law may be put into issue. Questions of fact cannot be
entertained. The finding of negligence by the Court of Appeals is a
question which this Court cannot look into as it would entail going
into factual matters on which the finding of negligence was based.
Such an approach cannot be allowed by this Court in the absence
of clear showing that the case falls under any of the
exceptions[10] to the well-established principle.
The finding by the trial court and the Court of Appeals that M/V
Manila City caught fire and sank by reason of the negligence of
the workers of CSEW, when the said vessel was under the
exclusive custody and control of CSEW is accordingly upheld.
Under the circumstances of the case, the doctrine of res ipsa
loquitur applies. For the doctrine of res ipsa loquitur to apply to a
given situation, the following conditions must concur: (1) the
accident was of a kind which does not ordinarily occur unless
someone is negligent; and (2) that the instrumentality or agency
which caused the injury was under the exclusive control of the
person charged with negligence.
The facts and evidence on record reveal the concurrence of
said conditions in the case under scrutiny. First, the fire that
occurred and consumed M/V Manila City would not have
happened in the ordinary course of things if reasonable care
and diligence had been exercised. In other words, some
negligence must have occurred. Second, the agency charged
with negligence, as found by the trial court and the Court of
Appeals and as shown by the records, is the herein petitioner,
Cebu Shipyard and Engineering Works, Inc., which had
control over subject vessel when it was docked for annual
repairs. So also, as found by the regional trial court, other
responsible causes, including the conduct of the plaintiff, and
third persons, are sufficiently eliminated by the evidence.[11]
What is more, in the present case the trial court found direct
evidence to prove that the workers and/or employees of
CSEW were remiss in their duty of exercising due diligence in
the care of subject vessel. The direct evidence substantiates
the conclusion that CSEW was really negligent.Thus, even
without applying the doctrine of res ipsa loquitur, in light of the
direct evidence on record, the ineluctable conclusion is that
the petitioner, Cebu Shipyard and Engineering Works, Inc.,
was negligent and consequently liable for damages to the
respondent, William Lines, Inc.
Neither is there tenability in the contention of petitioner that the
Court of Appeals erroneously ruled on the inadmissibility of the
expert testimonies it (petitioner) introduced on the probable
cause and origin of the fire. Petitioner maintains that the Court
of Appeals erred in disregarding the testimonies of the fire
experts, Messrs. David Grey and Gregory Michael Southeard,
who testified on the probable origin of the fire in M/V Manila
City. Petitioner avers that since the said fire experts were one
in their opinion that the fire did not originate in the area of Tank
Top No. 12 where the JNB workers were doing hotworks but
on the crew accommodation cabins on the portside No. 2
deck, the trial court and the Court of Appeals should have
given weight to such finding based on the testimonies of fire
experts; petitioner argues.
But courts are not bound by the testimonies of expert
witnesses. Although they may have probative value, reception
in evidence of expert testimonies is within the discretion of the
court. Section 49, Rule 130 of the Revised Rules of Court,
provides:
SEC. 49. Opinion of expert witness. - The opinion of a witness
on a matter requiring special knowledge, skill, experience or
training which he is shown to possess, may be received in
evidence.
The word may signifies that the use of opinion of an expert
witness as evidence is a prerogative of the courts. It is never
mandatory for judges to give substantial weight to expert
testimonies. If from the facts and evidence on record, a
conclusion is readily ascertainable, there is no need for the judge
to resort to expert opinion evidence. In the case under
consideration, the testimonies of the fire experts were not the only
available evidence on the probable cause and origin of the fire.
There were witnesses who were actually on board the vessel
when the fire occurred. Between the testimonies of the fire
experts who merely based their findings and opinions on
interviews and the testimonies of those present during the fire, the
latter are of more probative value. Verily, the trial court and the
Court of Appeals did not err in giving more weight to said
testimonies.
On the issue of subrogation, petitioner contends that Prudential is
not entitled to be subrogated to the rights of William Lines, Inc.,
theorizing that (1) the fire which gutted M/V Manila City was an
excluded risk and (2) it is a co-assured under the Marine Hull
Insurance Policy.
It is petitioners submission that the loss of M/V Manila City or
damage thereto is expressly excluded from the coverage of the
insurance because the same resulted from want of due diligence
by the Assured, Owners or Managers which is not included in the
risks insured against. Again, this theory of petitioner is bereft of
any factual or legal basis. It proceeds from a wrong premise that
the fire which gutted subject vessel was caused by the negligence
of the employees of William Lines, Inc. To repeat, the issue of who
between the parties was negligent has already been resolved
against Cebu Shipyard and Engineering Works, Inc. Upon proof of
payment by Prudential to William Lines, Inc., the former was
subrogated to the right of the latter to indemnification from
CSEW. As aptly ruled by the Court of Appeals, the law on the
matter is succinct and clear, to wit:
Art. 2207. If the plaintiffs property has been insured, and he has
received indemnity from the insurance company for the injury or
loss arising out of the wrong or breach of contract complained of,
the insurance company shall be subrogated to the rights of the
insured against the wrongdoer or the person who has violated the
contract. If the amount paid by the insurance company does not
fully cover the injury or loss, the aggrieved party shall be entitled
to recover the deficiency from the person causing the loss or
injury.[12]
Thus, when Prudential, after due verification of the merit and
validity of the insurance claim of William Lines, Inc., paid the latter
the total amount covered by its insurance policy, it was
subrogated to the right of the latter to recover the insured loss
from the liable party, CSEW.
30
Petitioner theorizes further that there can be no right of
subrogation as it is deemed a co-assured under the subject
insurance policy. To buttress its stance that it is a co-assured,
petitioner placed reliance on Clause 20 of of the Work Order
which states:
20. The insurance on the vessel should be maintained by the
customer and/or owner of the vessel during the period the contract
is in effect.[13]
According to petitioner, under the aforecited clause, William Lines,
Inc., agreed to assume the risk of loss of the vessel while under
drydock or repair and to such extent, it is benefited and effectively
constituted as a co-assured under the policy.
This theory of petitioner is devoid of sustainable merit. Clause 20
of the Work Order in question is clear in the sense that it requires
William Lines to maintain insurance on the vessel during the
period of dry-docking or repair. Concededly, such a stipulation
works to the benefit of CSEW as the shiprepairer. However, the
fact that CSEW benefits from the said stipulation does not
automatically make it as a co-assured of William Lines. The
intention of the parties to make each other a co-assured under an
insurance policy is to be gleaned principally from the insurance
contract or policy itself and not from any other contract or
agreement because the insurance policy denominates the
assured and the beneficiaries of the insurance. The hull and
machinery insurance procured by William Lines, Inc. from
Prudential named only William Lines, Inc. as the assured. There
was no manifestation of any intention of William Lines, Inc. to
constitute CSEW as a co-assured under subject policy. It is
axiomatic that when the terms of a contract are clear its
stipulations control.[14] Thus, when the insurance policy involved
named only William Lines, Inc. as the assured thereunder, the
claim of CSEW that it is a co-assured is unfounded.
Then too, in the Additional Perils Clause of the same Marine
Insurance Policy, it is provided that:
Subject to the conditions of this Policy, this insurance also covers
loss of or damage to vessel directly caused by the following:
xxx
Negligence of Charterers and/or Repairers, provided such
Charterers and/or Repairers are not an Assured hereunder.
[15]
(emphasis supplied)
As correctly pointed out by respondent Prudential, if CSEW were
deemed a co-assured under the policy, it would nullify any claim of
William Lines, Inc. from Prudential for any loss or damage caused
by the negligence of CSEW. Certainly, no shipowner would agree
to make a shiprepairer a co-assured under such insurance policy;
otherwise, any claim for loss or damage under the policy
would be invalidated. Such result could not have been
intended by William Lines, Inc.
Finally, CSEW argues that even assuming that it was
negligent and therefore liable to William Lines, Inc., by
stipulation in the Contract or Work Order its liability is limited to
One Million (P1,000,000.00) Pesos only, and Prudential a
mere subrogee of William Lines, Inc., should only be entitled
to collect the sum stipulated in the said contract.
Although in this jurisdiction, contracts of adhesion have been
consistently upheld as valid per se; as binding as an ordinary
contract, the Court recognizes instances when reliance on
such contracts cannot be favored especially where the facts
and circumstances warrant that subject stipulations be
disregarded.[16] Thus, in ruling on the validity and applicability
of the stipulation limiting the liability of CSEW for negligence to
One Million (P1,000,000.00) Pesos only, the facts and
circumstances vis-a-vis the nature of the provision sought to
be enforced should be considered, bearing in mind the
principles of equity and fair play.
It is worthy to note that M/V Manila City was insured with
Prudential for Forty Five Million (P45,000,000.00) Pesos. To
determine the validity and sustainability of the claim of William
Lines, Inc., for a total loss, Prudential conducted its own
inquiry. Upon thorough investigation by its hull surveyor, M/V
Manila City was found to be beyond economical salvage and
repair.[17] The evaluation of the average adjuster also reported
a constructive total loss.[18] The said claim of William Lines,
Inc., was then found to be valid and compensable such that
Prudential paid the latter the total value of its insurance claim.
Furthermore, it was ascertained that the replacement cost of
the vessel (the price of a vessel similar to M/V Manila City),
amounts to Fifty-five Million (P55,000,000.00) Pesos.[19]
Considering the aforestated circumstances, let alone the fact
that negligence on the part of petitioner has been sufficiently
proven, it would indeed be unfair and inequitable to limit the
liability of petitioner to One Million Pesos only. As aptly held by
the trial court, it is rather unconscionable if not overstrained.
To allow CSEW to limit its liability to One Million Pesos
notwithstanding the fact that the total loss suffered by the
assured and paid for by Prudential amounted to Forty Five
Million (P45,000,000.00) Pesos would sanction the exercise of
a degree of diligence short of what is ordinarily required
because, then, it would not be difficult for petitioner to escape
liability by the simple expedient of paying an amount very
much lower than the actual damage or loss suffered by
William Lines, Inc.
WHEREFORE, for want of merit, the petition is hereby DENIED
and the decision, dated September 3, 1997, and Resolution,
dated February 13, 1998, of the Court of Appeals AFFIRMED. No
pronouncement as to costs.
SO ORDERED.
G.R. No. L-44748 August 29, 1986
RADIO COMMUNICATIONS OF THE PHILS., INC.
(RCPI). petitioner,
vs.
COURT OF APPEALS and LORETO DIONELA, respondents.
O. Pythogoras Oliver for respondents.
PARAS, J.:
Before Us, is a Petition for Review by certiorari of the decision of
the Court of Appeals, modifying the decision of the trial court in a
civil case for recovery of damages against petitioner corporation
by reducing the award to private respondent Loreto Dionela of
moral damages from P40,000 to Pl5,000, and attorney's fees from
P3,000 to P2,000.
The basis of the complaint against the defendant corporation is a
telegram sent through its Manila Office to the offended party,
Loreto Dionela, reading as follows:
176 AS JR 1215PM 9 PAID MANDALUYONG JUL 22-66
LORETO DIONELA CABANGAN LEGASPI CITY
WIRE ARRIVAL OF CHECK FER
LORETO DIONELA-CABANGAN-WIRE ARRIVAL OF CHECK-
PER
115 PM
SA IYO WALANG PAKINABANG DUMATING KA DIYAN-WALA-
KANG PADALA DITO KAHIT BULBUL MO
(p. 19, Annex "A")
Plaintiff-respondent Loreto Dionela alleges that the defamatory
words on the telegram sent to him not only wounded his feelings
but also caused him undue embarrassment and affected
adversely his business as well because other people have come
to know of said defamatory words. Defendant corporation as a
defense, alleges that the additional words in Tagalog was a
private joke between the sending and receiving operators and that
they were not addressed to or intended for plaintiff and therefore
did not form part of the telegram and that the Tagalog words are
31
not defamatory. The telegram sent through its facilities was
received in its station at Legaspi City. Nobody other than the
operator manned the teletype machine which automatically
receives telegrams being transmitted. The said telegram was
detached from the machine and placed inside a sealed envelope
and delivered to plaintiff, obviously as is. The additional words in
Tagalog were never noticed and were included in the telegram
when delivered.
The trial court in finding for the plaintiff ruled as follows:
There is no question that the additional words in Tagalog are
libelous. They clearly impute a vice or defect of the plaintiff.
Whether or not they were intended for the plaintiff, the effect on
the plaintiff is the same. Any person reading the additional words
in Tagalog will naturally think that they refer to the addressee, the
plaintiff. There is no indication from the face of the telegram that
the additional words in Tagalog were sent as a private joke
between the operators of the defendant.
The defendant is sued directly not as an employer. The business
of the defendant is to transmit telegrams. It will open the door to
frauds and allow the defendant to act with impunity if it can escape
liability by the simple expedient of showing that its employees
acted beyond the scope of their assigned tasks.
The liability of the defendant is predicated not only on Article 33 of
the Civil Code of the Philippines but on the following articles of
said Code:
ART. 19.- Every person must, in the exercise of his rights and in
the performance of his duties, act with justice, give everyone his
due, and observe honesty and good faith.
ART. 20.-Every person who, contrary to law, wilfully or negligently
causes damage to another, shall indemnify the latter for the same.
There is sufficient publication of the libelous Tagalog words. The
office file of the defendant containing copies of telegrams received
are open and held together only by a metal fastener. Moreover,
they are open to view and inspection by third parties.
It follows that the plaintiff is entitled to damages and attorney's
fees. The plaintiff is a businessman. The libelous Tagalog words
must have affected his business and social standing in the
community. The Court fixes the amount of P40,000.00 as the
reasonable amount of moral damages and the amount of
P3,000.00 as attorney's fee which the defendant should pay the
plaintiff. (pp. 15-16, Record on Appeal)
The respondent appellate court in its assailed decision confirming
the aforegoing findings of the lower court stated:
The proximate cause, therefore, resulting in injury to appellee,
was the failure of the appellant to take the necessary or
precautionary steps to avoid the occurrence of the humiliating
incident now complained of. The company had not imposed
any safeguard against such eventualities and this void in its
operating procedure does not speak well of its concern for
their clientele's interests. Negligence here is very patent. This
negligence is imputable to appellant and not to its employees.
The claim that there was no publication of the libelous words
in Tagalog is also without merit. The fact that a carbon copy of
the telegram was filed among other telegrams and left to hang
for the public to see, open for inspection by a third party is
sufficient publication. It would have been otherwise perhaps
had the telegram been placed and kept in a secured place
where no one may have had a chance to read it without
appellee's permission.
The additional Tagalog words at the bottom of the telegram
are, as correctly found by the lower court, libelous per se, and
from which malice may be presumed in the absence of any
showing of good intention and justifiable motive on the part of
the appellant. The law implies damages in this instance
(Quemel vs. Court of Appeals, L-22794, January 16, 1968; 22
SCRA 44). The award of P40,000.00 as moral damages is
hereby reduced to P15,000.00 and for attorney's fees the
amount of P2,000.00 is awarded. (pp. 22-23, record)
After a motion for reconsideration was denied by the appellate
court, petitioner came to Us with the following:
ASSIGNMENT OF ERRORS
I circumstances surrounding the injury.
The Honorable Court of Appeals erred in holding that
Petitioner-employer should answer directly and primarily for
the civil liability arising from the criminal act of its employee.
II
The Honorable Court of Appeals erred in holding that there
was sufficient publication of the alleged libelous telegram in
question, as contemplated by law on libel.
III
The Honorable Court of Appeals erred in holding that the
liability of petitioner-company-employer is predicated on
Articles 19 and 20 of the Civil Code, Articles on Human
Relations.
IV
The Honorable Court of Appeals erred in awarding Atty's. fees. (p.
4, Record)
Petitioner's contentions do not merit our consideration. The action
for damages was filed in the lower court directly against
respondent corporation not as an employer subsidiarily liable
under the provisions of Article 1161 of the New Civil Code in
relation to Art. 103 of the Revised Penal Code. The cause of
action of the private respondent is based on Arts. 19 and 20 of the
New Civil Code (supra). As well as on respondent's breach of
contract thru the negligence of its own employees. 1
Petitioner is a domestic corporation engaged in the business of
receiving and transmitting messages. Everytime a person
transmits a message through the facilities of the petitioner, a
contract is entered into. Upon receipt of the rate or fee fixed, the
petitioner undertakes to transmit the message accurately. There is
no question that in the case at bar, libelous matters were included
in the message transmitted, without the consent or knowledge of
the sender. There is a clear case of breach of contract by the
petitioner in adding extraneous and libelous matters in the
message sent to the private respondent. As a corporation, the
petitioner can act only through its employees. Hence the acts of
its employees in receiving and transmitting messages are the acts
of the petitioner. To hold that the petitioner is not liable directly for
the acts of its employees in the pursuit of petitioner's business is
to deprive the general public availing of the services of the
petitioner of an effective and adequate remedy. In most cases,
negligence must be proved in order that plaintiff may recover.
However, since negligence may be hard to substantiate in some
cases, we may apply the doctrine of RES IPSA LOQUITUR (the
thing speaks for itself), by considering the presence of facts or
WHEREFORE, premises considered, the judgment of the
appellate court is hereby AFFIRMED.
SO ORDERED.
E. ASSUMPTION OF RISK (ART. 2178)
G.R. No. L-21749 September 29, 1967
REPUBLIC OF THE PHILIPPINES, plaintiff-appellee,
vs.
LUZON STEVEDORING CORPORATION, defendant-appellant.
Office of the Solicitor General for plaintiff-appellee.
H. San Luis and L.V. Simbulan for defendant-appellant.
REYES, J.B.L., J.:
32
The present case comes by direct appeal from a decision of the
Court of First Instance of Manila (Case No. 44572) adjudging the
defendant-appellant, Luzon Stevedoring Corporation, liable in
damages to the plaintiff-appellee Republic of the Philippines.
In the early afternoon of August 17, 1960, barge L-1892, owned by
the Luzon Stevedoring Corporation was being towed down the
Pasig river by tugboats "Bangus" and "Barbero"1 also belonging to
the same corporation, when the barge rammed against one of the
wooden piles of the Nagtahan bailey bridge, smashing the posts
and causing the bridge to list. The river, at the time, was swollen
and the current swift, on account of the heavy downpour of Manila
and the surrounding provinces on August 15 and 16, 1960.
Sued by the Republic of the Philippines for actual and
consequential damage caused by its employees, amounting to
P200,000 (Civil Case No. 44562, CFI of Manila), defendant Luzon
Stevedoring Corporation disclaimed liability therefor, on the
grounds that it had exercised due diligence in the selection and
supervision of its employees; that the damages to the bridge were
caused by force majeure; that plaintiff has no capacity to sue; and
that the Nagtahan bailey bridge is an obstruction to navigation.
After due trial, the court rendered judgment on June 11, 1963,
holding the defendant liable for the damage caused by its
employees and ordering it to pay to plaintiff the actual cost of the
repair of the Nagtahan bailey bridge which amounted to
P192,561.72, with legal interest thereon from the date of the filing
of the complaint.
Defendant appealed directly to this Court assigning the following
errors allegedly committed by the court a quo, to wit:
I The lower court erred in not holding that the herein defendant-
appellant had exercised the diligence required of it in the selection
and supervision of its personnel to prevent damage or injury to
others.1awphl.nt
II The lower court erred in not holding that the ramming of the
Nagtahan bailey bridge by barge L-1892 was caused by force
majeure.
III The lower court erred in not holding that the Nagtahan bailey
bridge is an obstruction, if not a menace, to navigation in the
Pasig river.
IV The lower court erred in not blaming the damage sustained
by the Nagtahan bailey bridge to the improper placement of the
dolphins.
V The lower court erred in granting plaintiff's motion to adduce
further evidence in chief after it has rested its case.
VI The lower court erred in finding the plaintiff entitled to the
amount of P192,561.72 for damages which is clearly
exorbitant and without any factual basis.
However, it must be recalled that the established rule in this
jurisdiction is that when a party appeals directly to the
Supreme Court, and submits his case there for decision, he is
deemed to have waived the right to dispute any finding of fact
made by the trial Court. The only questions that may be raised
are those of law (Savellano vs. Diaz, L-17441, July 31, 1963;
Aballe vs. Santiago, L-16307, April 30, 1963; G.S.I.S. vs.
Cloribel, L-22236, June 22, 1965). A converso, a party who
resorts to the Court of Appeals, and submits his case for
decision there, is barred from contending later that his claim
was beyond the jurisdiction of the aforesaid Court. The reason
is that a contrary rule would encourage the undesirable
practice of appellants' submitting their cases for decision to
either court in expectation of favorable judgment, but with
intent of attacking its jurisdiction should the decision be
unfavorable (Tyson Tan, et al. vs. Filipinas Compaia de
Seguros) et al., L-10096, Res. on Motion to Reconsider, March
23, 1966). Consequently, we are limited in this appeal to the
issues of law raised in the appellant's brief.
Taking the aforesaid rules into account, it can be seen that the
only reviewable issues in this appeal are reduced to two:
1) Whether or not the collision of appellant's barge with the
supports or piers of the Nagtahan bridge was in law caused by
fortuitous event or force majeure, and
2) Whether or not it was error for the Court to have permitted
the plaintiff-appellee to introduce additional evidence of
damages after said party had rested its case.
As to the first question, considering that the Nagtahan bridge
was an immovable and stationary object and uncontrovertedly
provided with adequate openings for the passage of water
craft, including barges like of appellant's, it is undeniable that
the unusual event that the barge, exclusively controlled by
appellant, rammed the bridge supports raises a presumption
of negligence on the part of appellant or its employees
manning the barge or the tugs that towed it. For in the ordinary
course of events, such a thing does not happen if proper care
is used. In Anglo American Jurisprudence, the inference arises
by what is known as the "res ipsa loquitur" rule (Scott vs.
London Docks Co., 2 H & C 596; San Juan Light & Transit Co.
vs. Requena, 224 U.S. 89, 56 L. Ed., 680; Whitwell vs. Wolf,
127 Minn. 529, 149 N.W. 299; Bryne vs. Great Atlantic &
Pacific Tea Co., 269 Mass. 130; 168 N.E. 540; Gribsby vs.
Smith, 146 S.W. 2d 719).
The appellant strongly stresses the precautions taken by it on the
day in question: that it assigned two of its most powerful tugboats
to tow down river its barge L-1892; that it assigned to the task the
more competent and experienced among its patrons, had the
towlines, engines and equipment double-checked and inspected;
that it instructed its patrons to take extra precautions; and
concludes that it had done all it was called to do, and that the
accident, therefore, should be held due to force majeure or
fortuitous event.
These very precautions, however, completely destroy the
appellant's defense. For caso fortuito or force majeure(which in
law are identical in so far as they exempt an obligor from
liability)2 by definition, are extraordinary events not foreseeable or
avoidable, "events that could not be foreseen, or which, though
foreseen, were inevitable" (Art. 1174, Civ. Code of the
Philippines). It is, therefore, not enough that the event should not
have been foreseen or anticipated, as is commonly believed, but it
must be one impossible to foresee or to avoid. The
mere difficulty to foresee the happening is not impossibility to
foresee the same: "un hecho no constituye caso fortuito por la
sola circunstancia de que su existencia haga mas dificil o mas
onerosa la accion diligente del presento ofensor" (Peirano
Facio, Responsibilidad Extra-contractual, p. 465; Mazeaud Trait
de la Responsibilite Civil, Vol. 2, sec. 1569). The very measures
adopted by appellant prove that the possibility of danger was not
only foreseeable, but actually foreseen, and was not caso fortuito.
Otherwise stated, the appellant, Luzon Stevedoring Corporation,
knowing and appreciating the perils posed by the swollen stream
and its swift current, voluntarily entered into a situation involving
obvious danger; it therefore assured the risk, and can not shed
responsibility merely because the precautions it adopted turned
out to be insufficient. Hence, the lower Court committed no error
in holding it negligent in not suspending operations and in holding
it liable for the damages caused.
It avails the appellant naught to argue that the dolphins, like the
bridge, were improperly located. Even if true, these circumstances
would merely emphasize the need of even higher degree of care
on appellant's part in the situation involved in the present case.
The appellant, whose barges and tugs travel up and down the
river everyday, could not safely ignore the danger posed by these
allegedly improper constructions that had been erected, and in
place, for years.
On the second point: appellant charges the lower court with
having abused its discretion in the admission of plaintiff's
additional evidence after the latter had rested its case. There is an
insinuation that the delay was deliberate to enable the
manipulation of evidence to prejudice defendant-appellant.
33
We find no merit in the contention. Whether or not further
evidence will be allowed after a party offering the evidence has
rested his case, lies within the sound discretion of the trial Judge,
and this discretion will not be reviewed except in clear case of
abuse.3
In the present case, no abuse of that discretion is shown. What
was allowed to be introduced, after plaintiff had rested its
evidence in chief, were vouchers and papers to support an item of
P1,558.00 allegedly spent for the reinforcement of the panel of the
bailey bridge, and which item already appeared in Exhibit GG.
Appellant, in fact, has no reason to charge the trial court of being
unfair, because it was also able to secure, upon written motion, a
similar order dated November 24, 1962, allowing reception of
additional evidence for the said defendant-appellant.4
WHEREFORE, finding no error in the decision of the lower Court
appealed from, the same is hereby affirmed. Costs against the
defendant-appellant.
G.R. No. L-25906 May 28, 1970
PEDRO D. DIOQUINO, plaintiff-appellee, vs. FEDERICO
LAUREANO, AIDA DE LAUREANO and JUANITO
LAUREANO, defendants-appellants.
FERNANDO, J.:
The present lawsuit had its origin in a relationship, if it could be
called such, the use of a car owned by plaintiff Pedro D. Dioquino
by defendant Federico Laureano, clearly of a character casual and
temporary but unfortunately married by an occurrence resulting in
its windshield being damaged. A stone thrown by a boy who, with
his other companions, was thus engaged in what undoubtedly for
them must have been mistakenly thought to be a none too harmful
prank did not miss its mark. Plaintiff would hold defendant
Federico Laureano accountable for the loss thus sustained,
including in the action filed the wife, Aida de Laureano, and the
father, Juanito Laureano. Plaintiff prevail in the lower court, the
judgment however going only against the principal defendant, his
spouse and his father being absolved of any responsibility.
Nonetheless, all three of them appealed directly to us, raising two
questions of law, the first being the failure of the lower court to
dismiss such a suit as no liability could have been incurred as a
result of a fortuitous event and the other being its failure to award
damages against plaintiff for the unwarranted inclusion of the wife
and the father in this litigation. We agree that the lower court
ought to have dismissed the suit, but it does not follow that
thereby damages for the inclusion of the above two other parties
in the complaint should have been awarded appellants.
The facts as found by the lower court follow: "Attorney Pedro
Dioquino, a practicing lawyer of Masbate, is the owner of a
car. On March 31, 1964, he went to the office of the MVO,
Masbate, to register the same. He met the defendant Federico
Laureano, a patrol officer of said MVO office, who was waiting
for a jeepney to take him to the office of the Provincial
Commander, PC, Masbate. Attorney Dioquino requested the
defendant Federico Laureano to introduce him to one of the
clerks in the MVO Office, who could facilitate the registration
of his car and the request was graciously attended to.
Defendant Laureano rode on the car of Atty. Dioquino on his
way to the P.C. Barracks at Masbate. While about to reach
their destination, the car driven by plaintiff's driver and with
defendant Federico Laureano as the sole passenger was
stoned by some 'mischievous boys,' and its windshield was
broken. Defendant Federico Laureano chased the boys and
he was able to catch one of them. The boy was taken to Atty.
Dioquino [and] admitted having thrown the stone that broke
the car's windshield. The plaintiff and the defendant Federico
Laureano with the boy returned to the P.C. barracks and the
father of the boy was called, but no satisfactory arrangements
[were] made about the damage to the
windshield."1
It was likewise noted in the decision now on appeal: "The
defendant Federico Laureano refused to file any charges
against the boy and his parents because he thought that the
stone-throwing was merely accidental and that it was due
to force majeure. So he did not want to take any action and
after delaying the settlement, after perhaps consulting a
lawyer, the defendant Federico Laureano refused to pay the
windshield himself and challenged that the case be brought to
court for judicial adjudication. There is no question that the
plaintiff tried to convince the defendant Federico Laureano just
to pay the value of the windshield and he even came to the
extent of asking the wife to convince her husband to settle the
matter amicably but the defendant Federico Laureano refused
to make any settlement, clinging [to] the belief that he could
not be held liable because a minor child threw a stone
accidentally on the windshield and therefore, the same was
due to force majeure."2
1. The law being what it is, such a belief on the part of
defendant Federico Laureano was justified. The express
language of Art. 1174 of the present Civil Code which is a
restatement of Art. 1105 of the Old Civil Code, except for the
addition of the nature of an obligation requiring the assumption
of risk, compels such a conclusion. It reads thus: "Except in
cases expressly specified by the law, or when it is otherwise
declared by stipulation, or when the nature of the obligation
requires the assumption of risk, no person shall be responsible
for those events which could not be, foreseen, or which, though
foreseen were inevitable." Even under the old Civil Code then, as
stressed by us in the first decision dating back to 1908, in an
opinion by Justice Mapa, the rule was well-settled that in the
absence of a legal provision or an express covenant, "no one
should be held to account for fortuitous cases."3 Its basis, as
Justice Moreland stressed, is the Roman law principle major
casus est, cui humana infirmitas resistere non potest.4 Authorities
of repute are in agreement, more specifically concerning an
obligation arising from contract "that some extraordinary
circumstance independent of the will of the obligor, or of his
employees, is an essential element of a caso fortuito."5 If it could
be shown that such indeed was the case, liability is ruled out.
There is no requirement of "diligence beyond what human care
and foresight can provide."6
The error committed by the lower court in holding defendant
Federico Laureano liable appears to be thus obvious. Its own
findings of fact repel the motion that he should be made to
respond in damages to the plaintiff for the broken windshield.
What happened was clearly unforeseen. It was a fortuitous event
resulting in a loss which must be borne by the owner of the car.
An element of reasonableness in the law would be manifestly
lacking if, on the circumstances as thus disclosed, legal
responsibility could be imputed to an individual in the situation of
defendant Laureano. Art. 1174 of the Civil Code guards against
the possibility of its being visited with such a reproach.
Unfortunately, the lower court was of a different mind and thus
failed to heed its command.
It was misled, apparently, by the inclusion of the exemption from
the operation of such a provision of a party assuming the risk,
considering the nature of the obligation undertaken. A more
careful analysis would have led the lower court to a different and
correct interpretation. The very wording of the law dispels any
doubt that what is therein contemplated is the resulting liability
even if caused by a fortuitous event where the party charged may
be considered as having assumed the risk incident in the nature
of the obligation to be performed. It would be an affront, not only
to the logic but to the realities of the situation, if in the light of what
transpired, as found by the lower court, defendant Federico
Laureano could be held as bound to assume a risk of this nature.
There was no such obligation on his part.
Reference to the leading case of Republic v. Luzon Stevedoring
Corp.7 will illustrate when the nature of the obligation is such that
the risk could be considered as having been assumed. As noted
in the opinion of Justice J.B.L. Reyes, speaking for the Court:
"The appellant strongly stresses the precautions taken by it on the
day in question: that it assigned two of its most powerful tugboats
to tow down river its barge L-1892; that it assigned to the task the
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more competent and experienced among its patrons, had the
towlines, engines and equipment double-checked and inspected;
that it instructed its patrons to take extra-precautions; and
concludes that it had done all it was called to do, and that the
accident, therefore, should be held due to force majeure or
fortuitous event." Its next paragraph explained clearly why the
defense of caso fortuito or force majeure does not lie. Thus:
"These very precautions, however, completely destroy the
appellant's defense. For caso fortuito or force majeure (which in
law are identical in so far as they exempt an obligor from liability)
by definition, are extraordinary events not foreseeable or
avoidable, 'events that could not be foreseen, or which, though
foreseen, were inevitable' (Art. 1174, Civil Code of the
Philippines). It is, therefore, not enough that the event should not
have been foreseen or participated, as is commonly believed, but
it must be one impossible to foresee or to avoid. The mere
difficulty to foresee the happening is not impossibility to foresee
the same: un hecho no constituye caso fortuito por la sola
circunstancia de que su existencia haga mas dificil o mas onerosa
la accion diligente del presente ofensor' (Peirano
Facio, Responsibilidad Extra-contractual, p. 465; Mazeaud, Traite
de la Responsibilite Civile, Vol. 2, sec. 1569). The very measures
adopted by appellant prove that the possibility of danger was not
only foreseeable, but actually foreseen, and was not caso fortuito."
In that case then, the risk was quite evident and the nature of the
obligation such that a party could rightfully be deemed as having
assumed it. It is not so in the case before us. It is anything but
that. If the lower court, therefore, were duly mindful of what this
particular legal provision contemplates, it could not have reached
the conclusion that defendant Federico Laureano could be held
liable. To repeat, that was clear error on its part.
2. Appellants do not stop there. It does not suffice for them that
defendant Federico Laureano would be freed from liability. They
would go farther. They would take plaintiff to task for his complaint
having joined the wife, Aida de Laureano, and the father, Juanita
Laureano. They were far from satisfied with the lower court's
absolving these two from any financial responsibility. Appellants
would have plaintiff pay damages for their inclusion in this
litigation. We are not disposed to view the matter thus.
It is to be admitted, of course, that plaintiff, who is a member of
the bar, ought to have exercised greater care in selecting the
parties against whom he would proceed. It may be said that his
view of the law that would consider defendant Federico Laureano
liable on the facts as thus disclosed, while erroneous, is not bereft
of plausibility. Even the lower court, mistakenly of course,
entertained similar view. For plaintiff, however, to have included
the wife and the father would seem to indicate that his
understanding of the law is not all that it ought to have been.
Plaintiff apparently was not entirely unaware that the inclusion
in the suit filed by him was characterized by unorthodoxy. He
did attempt to lend some color of justification by explicitly
setting forth that the father was joined as party defendant in
the case as he was the administrator of the inheritance of an
undivided property to which defendant Federico Laureano
could lay claim and that the wife was likewise proceeded
against because the conjugal partnership would be made to
respond for whatever liability would be adjudicated against the
husband.
It cannot be said that such an attempt at justification is
impressed with a high persuasive quality. Far from it.
Nonetheless, mistaken as plaintiff apparently was, it cannot be
concluded that he was prompted solely by the desire to inflict
needless and unjustified vexation on them. Considering the
equities of the situation, plaintiff having suffered a pecuniary
loss which, while resulting from a fortuitous event, perhaps
would not have occurred at all had not defendant Federico
Laureano borrowed his car, we, feel that he is not to be
penalized further by his mistaken view of the law in including
them in his complaint. Well-worth paraphrasing is the thought
expressed in a United States Supreme Court decision as to
the existence of an abiding and fundamental principle that the
expenses and annoyance of litigation form part of the social
burden of living in a society which seeks to attain social control
through law.8
WHEREFORE, the decision of the lower court of November 2,
1965 insofar as it orders defendant Federico Laureano to pay
plaintiff the amount of P30,000.00 as damages plus the
payment of costs, is hereby reversed. It is affirmed insofar as it
dismissed the case against the other two defendants, Juanita
Laureano and Aida de Laureano, and declared that no moral
damages should be awarded the parties. Without
pronouncement as to costs.

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