EN BANC el mismo, que un animal cause perjuicio para que nasca la responsibilidad
del dueno, aun no imputandose a este ninguna clase de culpa o
G.R. No. L-2075 November 29, 1949
MARGARITA AFIALDA, plaintiff-appellant,
vs.
BASILIO HISOLE and FRANCISCO HISOLE, defendants-appellees.
Nicolas P. Nonato for appellant.
Gellada, Mirasol and Ravena for appellees.
REYES, J.:
This is an action for damages arising from injury caused by an animal. The
complaint alleges that the now deceased, Loreto Afialda, was employed by the
defendant spouses as caretaker of their carabaos at a fixed compensation; that
while tending the animals he was, on March 21, 1947, gored by one of them and
later died as a consequence of his injuries; that the mishap was due neither to his
own fault nor to force majeure; and that plaintiff is his elder sister and heir
depending upon him for support.
Before filing their answer, defendants moved for the dismissal of the complaint for
lack of a cause of action, and the motion having been granted by the lower court,
plaintiff has taken this appeal.
Plaintiff seeks to hold defendants liable under article 1905 of the Civil Code, which
reads:
The possessor of an animal, or the one who uses the same, is liable for any
damages it may cause, even if such animal should escape from him or
stray away.
This liability shall cease only in case, the damage should arise from force
majeure or from the fault of the person who may have suffered it.
The question presented is whether the owner of the animal is liable when damage is
caused to its caretaker.
The lower court took the view that under the above-quoted provision of the Civil
Code, the owner of an animal is answerable only for damages caused to a stranger,
and that for damage caused to the caretaker of the animal the owner would be
liable only if he had been negligent or at fault under article 1902 of the same code.
Claiming that the lower court was in error, counsel for plaintiff contends that the
article 1905 does not distinguish between damage caused to the caretaker and
makes the owner liable whether or not he has been negligent or at fault. For
authority counsel cites the following opinion which Manresa quotes from a decision
of the Spanish Supreme Court:
El articulo 1905 del codigo Civil no consienta otra interpretacion que la que,
clara y evidentemente, se deriva de sus terminos literales, bastando, segun
negligencia, habida,sin duda, cuenta por el lgislador de que tal concepto de
dueno es suficiente para que arrastre las consecuencias favorables o
adversas de esta clase de propiedad, salvo la exception en el mismo
contenida. (12 Manresa, Commentaries on the Spanish CivilCode, 573.)
This opinion, however, appears to have been rendered in a case where an animal
caused injury to a stranger or third person. It is therefore no authority for a case
like the present where the person injured was the caretaker of the animal. The
distinction is important. For the statute names the possessor or user of the animal
as the person liable for "any damages it may cause," and this for the obvious reason
that the possessor or user has the custody and control of the animal and is
therefore the one in a position to prevent it from causing damage.
In the present case, the animal was in custody and under the control of the
caretaker, who was paid for his work as such. Obviously, it was the caretaker's
business to try to prevent the animal from causing injury or damage to anyone,
including himself. And being injured by the animal under those circumstances, was
one of the risks of the occupation which he had voluntarily assumed and for which
he must take the consequences.
In a decision of the Spanish Supreme Court, cited by Manresa in his Commentaries
(Vol. 12, p. 578), the death of an employee who was bitten by a feline which his
master had asked him to take to his establishment was by said tribunal declared to
be "a veritable accident of labor" which should come under the labor laws rather
than under article 1905 of the Civil Code. The present action, however, is not
brought under the Workmen's Compensation Act, there being no allegation that,
among other things, defendant's business, whatever that might be, had a gross
income of P20,000. As already stated, defendant's liability is made to rest on article
1905 of the Civil Code. but action under that article is not tenable for the reasons
already stated. On the other hand, if action is to be based on article 1902 of the
Civil Code, it is essential that there be fault or negligence on the part of the
defendants as owners of the animal that caused the damage. But the complaint
contains no allegation on those points.
There being no reversible error in the order appealed from, the same is hereby
affirmed, but without costs in view of the financial situation of the appellant.
 EN BANC
G.R. No. L-9010 March 28, 1914
J. H. CHAPMAN, plaintiff-appellant,
vs.
JAMES M. UNDERWOOD, defendant-appellee.
Wolfson & Wolfson for appellant.
Bruce, Lawrence, Ross & Block for appellee.
MORELAND, J.:
At the time the accident occurred, which is the basis of this action, there was a
single-track street-car line running along Calle Herran, with occasional switches to
allow cars to meet and pass each other. One of these switches was located at the
scene of the accident.
The plaintiff had been visiting his friend, a man by the name of Creveling, in front of
whose house the accident happened. He desired to board a certain "San Marcelino"
car coming from Santa Ana and bound for Manila. Being told by Creveling that the
car was approaching, he immediately, and somewhat hurriedly, passed from the
gate into the street for the purpose of signaling and boarding the car. The car was a
closed one, the entrance being from the front or the rear flatform. Plaintiff
attempted to board the front platform but, seeing that he could not reached it
without extra exertion, stopped beside the car, facing toward the rear platform, and
waited for it to come abreast of him in order to board. While in this position he was
struck from behind and run over by the defendant's automobile.
The defendant entered Calle Herran at Calle Peñafrancia in his automobile driven by
his chauffeur, a competent driver. A street car bound from Manila to Santa Ana
being immediately in front of him, he followed along behind it. Just before reaching
the scene of the accident the street car which was following took the switch — that
is, went off the main line to the left upon the switch lying alongside of the main
track. Thereupon the defendant no longer followed that the street car nor went to
the left, but either kept straight ahead on the main street-car track or a bit to the
right. The car which the plaintiff intended to board was on the main line and bound
in an opposite direction to that in which the defendant was going. When the front of
the "San Marcelino" car, the one the plaintiff attempted to board, was almost in
front of the defendant's automobile, defendant's driver suddenly went to the right
and struck and ran over the plaintiff, as above described.
The judgment of the trial court was for defendant.
A careful examination of the record leads us to the conclusion that the defendant's
driver was guilty of negligence in running upon and over the plaintiff. He was
passing an oncoming car upon the wrong side. The plaintiff, in common out to board
the car, was not obliged, for his own protection, to observe whether a car was
coming upon him from his left hand. He had only to guard against those coming
from the right. He knew that, according to the law of the road, no automobile or
other vehicle coming froEN BANC
G.R. No. L-20392 December 18, 1968
MARCIAL T. CAEDO, JUANA SANGALANG CAEDO, and the Minors, EPHRAIM
CAEDO, EILEEN CAEDO, ROSE ELAINE CAEDO, suing through their father,
MARCIAL T. CAEDO, as guardian ad litem, plaintiffs-appellants,
vs.
YU KHE THAI and RAFAEL BERNARDO, defendants-appellants.
Norberto J. Quisumbing for plaintiffs-appellants.
De Joya, Lopez, Dimaguila, Hermoso and Divino for defendants-appellants
MAKALINTAL, J.:
As a result of a vehicular accident in which plaintiff Marcial Caedo and several
members of his family were injured they filed this suit for recovery of damages from
the defendants. The judgment, rendered by the Court of First Instance of Rizal on
February 26, 1960 (Q-2952), contains the following disposition:
IN VIEW OF THE FOREGOING, the court renders a judgment, one in favor
of the plaintiffs and against the defendants, Yu Khe Thai and Rafael
Bernardo, jointly and severally, to pay to plaintiffs Marcial Caedo, et al.,
the sum of P1,929.70 for actual damages; P48,000.00 for moral damages;
P10,000.00 for exemplary damages; and P5,000.00 for attorney's fees,
with costs against the defendants. The counterclaim of the defendants
against the plaintiffs is hereby ordered dismissed, for lack of merits.
On March 12, 1960 the judgment was amended so as to include an additional award
of P3,705.11 in favor of the plaintiffs for the damage sustained by their car in the
accident.
Both parties appealed to the Court of Appeals, which certified the case to us in view
of the total amount of the plaintiffs' claim.
There are two principal questions posed for resolution: (1) who was responsible for
the accident? and (2) if it was defendant Rafael Bernardo, was his employer,
defendant Yu Khe Thai, solidarily liable with him? On the first question the trial court
found Rafael Bernardo negligent; and on the second, held his employer solidarily
liable with him.
The mishap occurred at about 5:30 in the morning of March 24, 1958 on Highway
54 (now E. de los Santos Avenue) in the vicinity of San Lorenzo Village. Marcial was
driving his Mercury car on his way from his home in Quezon City to the airport,
where his son Ephraim was scheduled to take a plane for Mindoro. With them in the
car were Mrs. Caedo and three daughters. Coming from the opposite direction was
the Cadillac of Yu Khe Thai, with his driver Rafael Bernardo at the wheel, taking the
owner from his Parañaque home to Wack Wack for his regular round of golf. The
two cars were traveling at fairly moderate speeds, considering the condition of the
road and the absence of traffic — the Mercury at 40 to 50 kilometers per hour, and
the Cadillac at approximately 30 to 35 miles (48 to 56 kilometers). Their headlights
were mutually noticeable from a distance. Ahead of the Cadillac, going in the same
direction, was a caretella owned by a certain Pedro Bautista. The carretela was
towing another horse by means of a short rope coiled around the rig's vertical post
on the right side and held at the other end by Pedro's son, Julian Bautista.
Rafael Bernardo testified that he was almost upon the rig when he saw it in front of
him, only eight meters away. This is the first clear indication of his negligence.
The carretela was provided with two lights, one on each side, and they should have
given him sufficient warning to take the necessary precautions. And even if he did
not notice the lights, as he claimed later on at the trial, the carretela should anyway
have been visible to him from afar if he had been careful, as it must have been in
the beam of his headlights for a considerable while.
In the meantime the Mercury was coming on its own lane from the opposite
direction. Bernardo, instead of slowing down or stopping altogether behind
the carretela until that lane was clear, veered to the left in order to pass. As he did
so the curved end of his car's right rear bumper caught the forward rim of the rig's
left wheel, wrenching it off and carrying it along as the car skidded obliquely to the
other lane, where it collided with the oncoming vehicle. On his part Caedo had seen
the Cadillac on its own lane; he slackened his speed, judged the distances in
relation to the carretela and concluded that the Cadillac would wait behind.
Bernardo, however, decided to take a gamble — beat the Mercury to the point
where it would be in line with the carretela, or else squeeze in between them in any
case. It was a risky maneuver either way, and the risk should have been quite
obvious. Or, since the car was moving at from 30 to 35 miles per hour (or 25 miles
according to Yu Khe Thai) it was already too late to apply the brakes when Bernardo
saw the carretela only eight meters in front of him, and so he had to swerve to the
left in spite of the presence of the oncoming car on the opposite lane. As it was, the
clearance Bernardo gave for his car's right side was insufficient. Its rear bumper, as
already stated, caught the wheel of the carretela and wrenched it loose. Caedo,
confronted with the unexpected situation, tried to avoid the collision at the last
moment by going farther to the right, but was unsuccessful. The photographs taken
at the scene show that the right wheels of his car were on the unpaved shoulder of
the road at the moment of impact.
There is no doubt at all that the collision was directly traceable to Rafael Bernardo's
negligence and that he must be held liable for the damages suffered by the
plaintiffs. The next question is whether or not Yu Khe Thai, as owner of the Cadillac,
is solidarily liable with the driver. The applicable law is Article 2184 of the Civil
Code, which reads:
ART. 2184. In motor vehicle mishaps, the owner is solidarily liable with his
driver, if the former, who was in the vehicle, could have, by the use of due
diligence, prevented the misfortune. It is disputably presumed that a driver
was negligent, if he had been found guilty of reckless driving or violating
traffic regulations at least twice within the next preceding two months.
Under the foregoing provision, if the causative factor was the driver's negligence,
the owner of the vehicle who was present is likewise held liable if he could have
prevented the mishap by the exercise of due diligence. The rule is not new,
although formulated as law for the first time in the new Civil Code. It was expressed
in Chapman vs. Underwood (1914), 27 Phil. 374, where this Court held:
... The same rule applies where the owner is present, unless the negligent
acts of the driver are continued for such a length of time as to give the
owner a reasonable opportunity to observe them and to direct his driver to
desist therefrom. An owner who sits in his automobile, or other vehicle,
and permits his driver to continue in a violation of the law by the
performance of negligent acts, after he has had a reasonable opportunity
to observe them and to direct that the driver cease therefrom, becomes
himself responsible for such acts. The owner of an automobile who permits
his chauffeur to drive up the Escolta, for example, at a speed of 60 miles
an hour, without any effort to stop him, although he has had a reasonable
opportunity to do so, becomes himself responsible, both criminally and
civilly, for the results produced by the acts of the chauffeur. On the other
hand, if the driver, by a sudden act of negligence, and without the owner
having a reasonable opportunity to prevent the act or its continuance,
injures a person or violates the criminal law, the owner of the automobile,
although present therein at the time the act was committed, is not
responsible, either civilly or criminally, therefor. The act complained of
must be continued in the presence of the owner for such a length of time
that the owner, by his acquiescence, makes his driver act his own.
The basis of the master's liability in civil law is not respondent superior but rather
the relationship of paterfamilias. The theory is that ultimately the negligence of the
servant, if known to the master and susceptible of timely correction by him, reflects
his own negligence if he fails to correct it in order to prevent injury or damage.
In the present case the defendants' evidence is that Rafael Bernardo had been Yu
Khe Thai's driver since 1937, and before that had been employed by Yutivo Sons
Hardware Co. in the same capacity for over ten years. During that time he had no
record of violation of traffic laws and regulations. No negligence for having
employed him at all may be imputed to his master. Negligence on the part of the
latter, if any, must be sought in the immediate setting and circumstances of the
accident, that is, in his failure to detain the driver from pursuing a course which not
only gave him clear notice of the danger but also sufficient time to act upon it. We
do not see that such negligence may be imputed. The car, as has been stated, was
not running at an unreasonable speed. The road was wide and open, and devoid of
traffic that early morning. There was no reason for the car owner to be in any
special state of alert. He had reason to rely on the skill and experience of his driver.
He became aware of the presence of the carretela when his car was only twelve
meters behind it, but then his failure to see it earlier did not constitute negligence,
for he was not himself at the wheel. And even when he did see it at that distance,
he could not have anticipated his driver's sudden decision to pass the carretela on
its left side in spite of the fact that another car was approaching from the opposite
direction. The time element was such that there was no reasonable opportunity for
Yu Khe Thai to assess the risks involved and warn the driver accordingly. The
thought that entered his mind, he said, was that if he sounded a sudden warning it
might only make the other man nervous and make the situation worse. It was a
thought that, wise or not, connotes no absence of that due diligence required by law
to prevent the misfortune.
The test of imputed negligence under Article 2184 of the Civil Code is, to a great
degree, necessarily subjective. Car owners are not held to a uniform and inflexible
standard of diligence as are professional drivers. In many cases they refrain from
driving their own cars and instead hire other persons to drive for them precisely
because they are not trained or endowed with sufficient discernment to know the
rules of traffic or to appreciate the relative dangers posed by the different situations
that are continually encountered on the road. What would be a negligent omission
under aforesaid Article on the part of a car owner who is in the prime of age and
knows how to handle a motor vehicle is not necessarily so on the part, say, of an
old and infirm person who is not similarly equipped.
The law does not require that a person must possess a certain measure of skill or
proficiency either in the mechanics of driving or in the observance of traffic rules
before he may own a motor vehicle. The test of his intelligence, within the meaning
of Article 2184, is his omission to do that which the evidence of his own senses tells
him he should do in order to avoid the accident. And as far as perception is
concerned, absent a minimum level imposed by law, a maneuver that appears to be
fraught with danger to one passenger may appear to be entirely safe and
commonplace to another. Were the law to require a uniform standard of
perceptiveness, employment of professional drivers by car owners who, by their
very inadequacies, have real need of drivers' services, would be effectively
proscribed.
A. Contusion, with hematoma, scalp, frontal left; abrasions, chest
wall, anterior;
B. Multiple fractures, ribs, right, lst to 5th inclusive. Third rib has a
double fracture; Subparieto-plaural hematoma; Basal disc
atelectasis, lung, right lower lobe, secondary;
C. Pseudotosis, left, secondary to probable basal fracture, skull.
JUANA SANGALANG CAEDO:
A. Abrasions, multiple:
(1)frontal region, left; (2) apex of nose; (3) upper eyelid, left;
(4) knees.
B. Wound, lacerated, irregular, deep, frontal;
C. Fracture, simple, 2nd rib posterior, left with displacement.
D. Fracture, simple, base, proximal phalanx right, big toe.
E. Fracture, simple, base, metatarsals III and V right.
F. Concussion, cerebral.

We hold that the imputation of liability to Yu Khe Thai, solidarily with Rafael
EPHRAIM CAEDO:
Bernardo, is an error. The next question refers to the sums adjudged by the trial
court as damages. The award of P48,000 by way of moral damages is itemized as
follows: A. Abrasions, multiple:
(1) left temporal area; (2) left frontal; (3) left supraorbital

1. Marcial Caedo P 20,000.00 EILEEN CAEDO:

2. Juana S. Caedo 15,000.00

A. Lacerated wound (V-shaped), base, 5th finger, right, lateral
3. Ephraim Caedo 3,000.00 aspect.
B. Abrasions, multiple:
(1) dorsum, proximal phalanx middle finger; (2) Knee, anterior,
4. Eileen Caedo 4,000.00
bilateral; (3) shin, lower 1/3.
5. Rose Elaine Caedo 3,000.00
ROSE ELAINE CAEDO:
6. Merilyn Caedo 3,000.00
A. Abrasions, multiple: (1) upper and lower lids; (2) left temporal;
(3) nasolabial region; (4) leg, lower third, anterior.
Plaintiffs appealed from the award, claiming that the Court should have granted
them also actual or compensatory damages, aggregating P225,000, for the injuries
they sustained. Defendants, on the other hand maintain that the amounts awarded MARILYN CAEDO:
as moral damages are excessive and should be reduced. We find no justification for
either side. The amount of actual damages suffered by the individual plaintiffs by A. Abrasions, multiple: (1)shin, lower 1/3 right; (2) arm, lower
reason of their injuries, other than expenses for medical treatment, has not been third
shown by the evidence. Actual damages, to be compensable, must be proven. Pain
and suffering are not capable of pecuniary estimation, and constitute a proper
ground for granting moral, not actual, damages, as provided in Article 2217 of the C. Contusion with hematoma, shin, lower 1/3, anterior aspect,
Civil Code. right. (See Exhibits D, D-1, D-2, D-3, D-4, and D- 5)

The injuries sustained by plaintiffs are the following: It is our opinion that, considering the nature and extent of the above-mentioned
injuries, the amounts of moral damages granted by the trial court are not excessive.

MARCIAL T. CAEDO:
WHEREFORE, the judgment appealed from is modified in the sense of declaring
defendant-appellant Yu Khe Thai free from liability, and is otherwise affirmed with
respect to defendant Rafael Bernardo, with costs against the latter.

m his left should pass upon his side of the car. He needed only to watch for cars
coming from his right, as they were the only ones under the law permitted to pass
upon that side of the street car.

The defendant, however, is not responsible for the negligence of his driver, under
the facts and circumstances of this case. As we have said in the case of Johnson vs.
David (5 Phil. Rep., 663), the driver does not fall within the list of persons in article
1903 of the Civil Code for whose acts the defendant would be responsible.

Although in the David case the owner of the vehicle was not present at the time the
alleged negligent acts were committed by the driver, the same rule applies where
the owner is present, unless the negligent act of the driver are continued for such a
length of time as to give the owner a reasonable opportunity to observe them and
to direct his driver to desist therefrom. An owner who sits in his automobile, or
other vehicle, and permits his driver to continue in a violation of the law by the
performance of negligent acts, after he has had a reasonable opportunity to observe
them and to direct that the driver cease therefrom, becomes himself responsible for
such acts. The owner of an automobile who permits his chauffeur to drive up to
Escolta, for example, at a speed of 60 miles an hour, without any effort to stop him,
although he has had a reasonable opportunity to do so, becomes himself
responsible, both criminally and civilly, for the results produced by the acts of his
chauffeur. On the other hand, if the driver, by a sudden act of negligence, and
without the owner having a reasonable opportunity to prevent the acts or its
continuance, injures a person or violates the criminal law, the owner of the
automobile, although present therein at the time the act was committed, is not
responsible, either civilly or criminally, therefor. The act complained of must be
continued in the presence of the owner for such a length a time that the owner, by
his acquiescence, makes his driver's act his own.

In the case before us it does not appear from the record that, from the time the
automobile took the wrong side of the road to the commission of the injury,
sufficient time intervened to give the defendant an opportunity to correct the act of
his driver. Instead, it appears with fair clearness that the interval between the
turning out to meet and pass the street car and the happening of the accident was
so small as not to be sufficient to charge defendant with the negligence of the
driver.

Whether or not the owner of an automobile driven by a competent driver, would be

responsible, whether present or not, for the negligent acts of his driver when the
automobile was a part of a business enterprise, and was being driven at the time of
the accident in furtherance of the owner's business, we do not now decide.

The judgment appealed from is affirmed, with costs against the appellant.
G.R. No. 118889 March 23, 1998 We find no reversible error committed by respondent court in upholding the
dismissal of petitioner's complaint. The pertinent provision is Art. 2176 of the Civil
Code which states: "Whoever by act or omission causes damage to another, there
FGU INSURANCE CORPORATION, petitioner,
being fault or negligence, is obliged to pay for the damage done. Such fault or
vs.
negligence, if there is no pre-existing contractual relation between the parties, is
COURT OF APPEALS, FILCAR TRANSPORT, INC., and FORTUNE INSURANCE
called a quasi-delict . . . . "
CORPORATION, respondents.

To sustain a claim based thereon, the following requisites must concur: (a) damage
suffered by the plaintiff; (b) fault or negligence of the defendant; and, (c)
connection of cause and effect between the fault or negligence of the defendant and
BELLOSILLO, J.: the damage incurred by the plaintiff.6

For damages suffered by a third party, may an action based on quasi-delict prosper
against a rent-a-car company and, consequently, its insurer for fault or negligence
of the car lessee in driving the rented vehicle?
This was a two-car collision at dawn. At around 3 o'clock of 21 April 1987, two (2)
vehicles, both Mitsubishi Colt Lancers, cruising northward along Epifanio de los
Santos Avenue, Mandaluyong City, figured in a traffic accident. The car bearing
Plate No. PDG 435 owned by Lydia F. Soriano was being driven at the outer lane of
the highway by Benjamin Jacildone, while the other car, with Plate No. PCT 792,
owned by respondent FILCAR Transport, Inc. (FILCAR), and driven by Peter Dahl-
Jensen as lessee, was at the center lane, left of the other vehicle. Upon approaching
the corner of Pioneer Street, the car owned by FILCAR swerved to the right hitting
the left side of the car of Soriano. At that time Dahl-Jensen, a Danish tourist, did
not possess a Philippine driver's license. 1
We agree with respondent court that petitioner failed to prove the existence of the
second requisite, i.e., fault or negligence of defendant FILCAR, because only the
fault or negligence of Dahl-Jensen was sufficiently established, not that of FILCAR.
It should be noted that the damage caused on the vehicle of Soriano was brought
about by the circumstance that Dahl-Jensen swerved to the right while the vehicle
that he was driving was at the center lane. It is plain that the negligence was solely
attributable to Dahl-Jensen thus making the damage suffered by the other vehicle
his personal liability. Respondent FILCAR did not have any participation therein.
Article 2180 of the same Code which deals also with quasi-delict provides:
The obligation imposed by article 2176 is demandable not only for
one's own acts or omissions, but also for those of persons for
whom one is responsible.

As a consequence, petitioner FGU Insurance Corporation, in view of its insurance

The father and, in case of his death or incapacity, the mother, are
contract with Soriano, paid the latter P25,382.20. By way of subrogation,2 it sued
responsible for the damages caused by the minor children who
Dahl-Jensen and respondent FILCAR as well as respondent Fortune Insurance
live in their company.
Corporation (FORTUNE) as insurer of FILCAR for quasi-delict before the Regional
Trial Court of Makati City.
Guardians are liable for damages caused by the minors or
incapacitated persons who are under their authority and live in
Unfortunately, summons was not served on Dahl-Jensen since he was no longer
their company.
staying at his given address; in fact, upon motion of petitioner, he was dropped
from the complaint.
The owners and managers of an establishment or enterprise are
likewise responsible for damages caused by their employees in the
On 30 July 1991 the trial court dismissed the case for failure of petitioner to
service of the branches in which the latter are employed or on the
substantiate its claim of subrogation.3
occasion of their functions.

On 31 January 1995 respondent Court of Appeals affirmed the ruling of the trial
Employers shall be liable for the damages caused by their
court although based on another ground, i.e., only the fault or negligence of Dahl-
employees and household helpers acting within the scope of their
Jensen was sufficiently proved but not that of respondent FILCAR.4 In other words,
assigned tasks, even though the former are not engaged in any
petitioner failed to establish its cause of action for sum of money based on quasi-
business or industry.
delict.

The State is responsible in like manner when it acts through a

In this appeal, petitioner insists that respondents are liable on the strength of the
special agent; but not when the damage has been caused by the
ruling in MYC-Agro-Industrial Corporation v. Vda. de Caldo5 that the registered
official to whom the task done properly pertains, in which case
owner of a vehicle is liable for damages suffered by third persons although the
what is provided in article 2176 shall be applicable.
vehicle is leased to another.
 Lastly, teachers or heads of establishments of arts and trades
shall be liable for damages caused by their pupils and students or
apprentices, so long as they remain in their custody.

The responsibility treated of in this article shall cease when the

persons herein mentioned prove that they observed all the
diligence of a good father of a family to prevent damage.

The liability imposed by Art. 2180 arises by virtue of a presumption juris tantum of
negligence on the part of the persons made responsible thereunder, derived from
their failure to exercise due care and vigilance over the acts of subordinates to
prevent them from causing damage.7 Yet, as correctly observed by respondent
court, Art. 2180 is hardly applicable because none of the circumstances mentioned
therein obtains in the case under consideration. Respondent FILCAR being engaged
in a rent-a-car business was only the owner of the car leased to Dahl-Jensen. As
such, there was no vinculum juris between them as employer and employee.
Respondent FILCAR cannot in any way be responsible for the negligent act of Dahl-
Jensen, the former not being an employer of the latter.

We now correlate par. 5 of Art. 2180 with Art. 2184 of the same Code which
provides: "In motor vehicle mishap, the owner is solidarily liable with his driver, if
the former, who was in the vehicle, could have by the use of due diligence,
prevented the misfortune . . . . If the owner was not in the motor vehicle, the
provisions of article 2180 are applicable." Obviously, this provision of Art. 2184 is
neither applicable because of the absence of master-driver relationship between
respondent FILCAR and Dahl-Jensen. Clearly, petitioner has no cause of action
against respondent FILCAR on the basis of quasi-delict; logically, its claim against
respondent FORTUNE can neither prosper.

Petitioner's insistence on MYC-Agro-Industrial Corporation is rooted in a

misapprehension of our ruling therein. In that case, the negligent and reckless
operation of the truck owned by petitioner corporation caused injuries to several
persons and damage to property. Intending to exculpate itself from liability, the
corporation raised the defense that at the time of the collision it had no more
control over the vehicle as it was leased to another; and, that the driver was not its
employee but of the lessee. The trial court was not persuaded as it found that the
true nature of the alleged lease contract was nothing more than a disguise effected
by the corporation to relieve itself of the burdens and responsibilities of an
employer. We upheld this finding and affirmed the declaration of joint and several
liability of the corporation with its driver.

WHEREFORE, the petition is DENIED. The decision of respondent Court of Appeals

dated 31 January 1995 sustaining the dismissal of petitioner's complaint by the trial
court is AFFIRMED. Costs against petitioner.

SO ORDERED.
FIRST DIVISION injuries, Antero was later transferred to the Philippine General Hospital. However,
on 3 November 1994, Antero died due to the injuries he sustained from the
SOFIA M. GUILLANG, represented G.R. No. 162987 collision. The car was a total wreck while the truck sustained minor damage.
by SUSAN GUILLANG-CABATBAT,
REYNALDO, GERARDO,
BIENVENIDO, DAWNA, and NELLIE, On 24 April 1995, petitioners Genaro, Llanillo, Dignadice, and the heirs of
all surnamed GUILLANG, Antero[5] instituted a complaint for damages based on quasi-delict against
GENARO GUILLANG, respondents Bedania and de Silva.
JOSE DIGNADICE, and
ALVIN LLANILLO, On 5 December 2000, the trial court rendered a decision in favor of petitioners. The
Petitioners, trial court found Bedania grossly negligent for recklessly maneuvering the truck by
Present: making a sudden U-turn in the highway without due regard to traffic rules and the
safety of other motorists. The trial court also declared de Silva grossly negligent in
PUNO, C.J., Chairperson, the selection and supervision of his driver, Bedania. The dispositive portion of the
- versus - CARPIO, decision provides:
CORONA,
LEONARDO-DE CASTRO, and WHEREFORE, judgment is hereby rendered ordering defendants Rodolfo A. Bedania
BERSAMIN, JJ. and Rodolfo de Silva, jointly and severally, to pay plaintiffs, as follows:

1. The sum of P508,566.03 representing the damage/repair costs of the

RODOLFO BEDANIA Promulgated: Toyota to plaintiff Genaro M. Guillang.
and RODOLFO DE SILVA,
Respondents. May 21, 2009 2. The sum of P50,000.00 for the death of Antero Guillang plus P185,000.00
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x for his burial expenses, to the heirs of Antero Guillang.

DECISION 3. For hospital and medical expenses as reflected in Exhibits E, E-1 to E-30 to
plaintiffs Genaro M. Guillang, Jose Dignadice and Alvin Llanillo.
CARPIO, J.:
The Case 4. The sum of P50,000.00 as moral damages for the heirs of the deceased
Antero Guillang.
This is a petition for review[1] of the 3 June 2003 Decision[2] and the 23 March 2004
Resolution[3] of the Court of Appeals in CA-G.R. CV No. 69289. The 3 June 2003 5. The sum of P50,000.00 as moral damages each to plaintiffs Jose Dignadice,
Decision set aside the 5 December 2000 Decision[4] of the Regional Trial Court, Alvin Llanillo and Genaro Guillang.
Branch 30, Manila (trial court). The 23 March 2004 Resolution denied the motion for
reconsideration. 6. The sum of P50,000.00 as exemplary damages.

The Facts 7. The sum of P100,000.00 as and for attorneys fess.

On 25 October 1994, at about 5:45 in the afternoon, petitioner Genaro M. Guillang 8. The costs of the suit.
(Genaro) was driving his brand new Toyota Corolla GLI sedan with conduction
sticker no. 54-DFT (car) along Emilio Aguinaldo Highway (highway) in SO ORDERED.[6]
Cavite. Genaro, Antero Guillang (Antero), Felipe Jurilla, Jose Dignadice (Dignadice),
and Alvin Llanillo (Llanillo) had all just left from Golden City, Dasmarias, Cavite, and Respondents appealed to the Court of Appeals.
were on their way to Manila. At the other side of the highway, respondent Rodolfo
A. Bedania (Bedania) was driving a ten-wheeler Isuzu cargo truck with plate no. On 3 June 2003, the Court of Appeals rendered its decision in favor of
CAC-923 (truck) towards Tagaytay City. The truck was owned by respondent respondents. The dispositive portion of the decision provides:
Rodolfo de Silva (de Silva).
IN VIEW OF ALL THE FOREGOING, the appealed decision is REVERSED and SET
Along the highway and the road leading to the Orchard Golf Course, Bedania ASIDE. The complaint of the herein appellees in Civil Case No. 95-73666
negotiated a U-turn. When the truck entered the opposite lane of the highway, is DISMISSED, for lack of merit. The appellants counterclaims in the instant case
Genaros car hit the right portion of the truck. The truck dragged Genaros car some are likewise DISMISSED. No pronouncement as to cost.
five meters to the right of the road.
SO ORDERED.[7]
As a consequence, all the passengers of the car were rushed to the De La Salle
University Medical Center in Dasmarias, Cavite for treatment. Because of severe
Petitioners filed a motion for reconsideration. On 23 March 2004, the Court of
Appeals denied the motion.
Hence, this petition.
The Ruling of the Regional Trial Court
According to the trial court, there is a presumption that a person driving a motor
vehicle has been negligent if at the time of the mishap, he was violating any traffic
regulation.[8]In this case, the trial court found that the Traffic Accident Investigation
Report (report),[9] corroborated by the testimonies of the witnesses, showed that
the truck committed a traffic violation by executing a U-turn without signal
lights. The trial court also declared that Bedania violated Sections
45(b),[10] 48,[11] and 54[12] of Republic Act No. 4136[13] when he executed the sudden
U-turn. The trial court added that Bedania violated another traffic rule when he
abandoned the victims after the collision.[14] The trial court concluded that Bedania
was grossly negligent in his driving and held him liable for damages.
Moreover, the trial court found that Bedania did not make the U-turn at an
intersection. According to the trial court, vehicles trying to maneuver to change
directions must seek an intersection where it is safer to maneuver and not
recklessly make a U-turn in a highway. The trial court said Bedania should have
observed extreme caution in making a U-turn because it was unexpected that a long
cargo truck would execute a U-turn along the highway.
The trial court also said that Bedanias gross negligence raised the legal presumption
that de Silva, as Bedanias employer, was negligent in the selection and supervision
of his employees. The trial court said that, under Articles 2176[15] and 2180[16] of the
Civil Code, de Silvas liability was based on culpa aquiliana which holds the employer
primarily liable for tortious acts of his employees, subject to the defense that he
exercised all the diligence of a good father of a family in the selection and
supervision of his employees.The trial court ruled that de Silva failed to prove this
defense and, consequently, held him liable for damages.
The Ruling of the Court of Appeals
The Court of Appeals reversed the trial courts decision and said that the trial court
overlooked substantial facts and circumstances which, if properly considered, would
justify a different conclusion and alter the results of the case.
The Court of Appeals dismissed the testimonies of the witnesses and declared that
they were contrary to human observation, knowledge and experience. The Court of
Appeals also said that the following were the physical evidences in the case:
1. It was not yet dark when the incident transpired;
2. The four-lane highway the appellees were cruising on was
wide, straight, dry, relatively plain and with no obstructions to the drivers vision;
3. The point of impact of the collision is on the lane where the car was
cruising and the car hit the gas tank of the truck located at its right middle portion,
which indicates that the truck had already properly positioned itself and had already
executed the U-turn before the impact occurred;
4. Genaro Guillang was not able to stop the car in time and the
cars front portion was totally wrecked. This negates appellees contention that they
were traveling at a moderate speed; and
5. The sheer size of the truck makes it improbable for the said vehicle to
negotiate a U-turn at a sudden and fast speed as appellees vigorously suggest
without toppling over on its side.[17] (Citations omitted)
The Court of Appeals concluded that the collision was caused by Genaros
negligence. The Court of Appeals declared that the truck arrived at the intersection
way ahead of the car and had already executed the U-turn when the car, traveling
at a fast speed, hit the trucks side. The Court of Appeals added that considering the
time and the favorable visibility of the road and the road conditions, Genaro, if he
was alert, had ample time to react to the changing conditions of the road. The Court
of Appeals found no reason for Genaro not to be prudent because he was
approaching an intersection and there was a great possibility that vehicles would be
traversing the intersection either going to or from Orchard Golf Course. The Court of
Appeals said Genaro should have slowed down upon reaching the intersection. The
Court of Appeals concluded that Genaros failure to observe the necessary
precautions was the proximate cause of Anteros death and the injuries of the
petitioners.
The Court of Appeals also relied on the testimony of Police Traffic Investigator Efren
Videna (Videna) that the car was running at a fast speed and overtook another
vehicle just before the collision occurred.[18] The Court of Appeals concluded that
Genaro did not see the truck as the other vehicle temporarily blocked his view of
the intersection. The Court of Appeals also gave weight to Videnas testimony that it
was normal for a ten-wheeler truck to make a U-turn on that part of the highway
because the entrance to Orchard Golf Course was spacious.[19]
The Issues
Petitioners raise the following issues:
1. Did the Court of Appeals decide a question of substance in this case in
a way probably not in accord with law or with the applicable decisions of the
Honorable Supreme Court?
2. Did the Court of Appeals depart from the accepted and usual course of
judicial proceedings particularly when it revised, and recast the findings of facts of
the trial court pertaining to credibility of witnesses of which the trial court was at
the vantage point to evaluate?
3. Did the Court of Appeals act with grave abuse of discretion amounting
to lack of jurisdiction when it rendered the palpably questionable Court of
Appeals Decision that tampered with the findings of fact of the trial court for no
justifiable reason?
4. Is the Court of Appeals judgment and resolution reversing the decision
of the trial court supported by the evidence and the law and jurisprudence
applicable?[20]

The issue in this case is who is liable for the damages suffered by petitioners. The
trial court held Bedania and de Silva, as Bedanias employer, liable because the
proximate cause of the collision was the sudden U-turn executed by Bedania without
any signal lights. On the other hand, the Court of Appeals reversed the trial courts
decision and held Genaro liable because the proximate cause of the collision was
Genaros failure to stop the car despite seeing that Bedania was making a U-turn.
The Ruling of the Court
The principle is well-established that this Court is not a trier of facts. Therefore, in
an appeal by certiorari under Rule 45 of the Rules of Court, only questions of law
may be raised. The resolution of factual issues is the function of the lower courts
whose findings on these matters are received with respect and are, as a rule,
binding on this Court.[21]
However, this rule is subject to certain exceptions. One of these is when the
findings of the appellate court are contrary to those of the trial court.[22] Findings of
fact of the trial court and the Court of Appeals may also be set aside when such
findings are not supported by the evidence or where the lower courts conclusions
are based on a misapprehension of facts.[23] Such is the situation in this case and
we shall re-examine the facts and evidence presented before the lower courts.
Article 2176 of the Civil Code provides that whoever by act or omission causes
damage to another, there being fault or negligence, is obliged to pay for the
damage done. Such fault or negligence, if there is no pre-existing contractual
relations between the parties, is called a quasi-delict. To sustain a claim based on
quasi-delict, the following requisites must concur: (a) damage suffered by the
plaintiff; (b) fault or negligence of defendant; and (c) connection of cause and effect
between the fault or negligence of defendant and the damage incurred by the
plaintiff.[24]
There is no dispute that petitioners suffered damages because of the
collision. However, the issues on negligence and proximate cause are disputed.
On the Presumption of Negligence and Proximate Cause
Negligence is defined as 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. In Picart v.
Smith,[25] we held that the test of negligence is whether the defendant in doing the
alleged negligent act used that reasonable care and caution which an ordinary
person would have used in the same situation.
The conclusion of the Court of Appeals that Genaro was negligent is not supported
by the evidence on record. In ruling that Genaro was negligent, the Court of
Appeals gave weight and credence to Videnas testimony. However, we find that
Videnas testimony was inconsistent with the police records and report that he made
on the day of the collision.First, Videna testified that the car was running fast and
overtook another vehicle that already gave way to the truck.[26] But this was not
indicated in either the report or the police records. Moreover, if the car was
speeding, there should have been skid marks on the road when Genaro stepped on
the brakes to avoid the collision. But the sketch of the accident showed no skid
marks made by the car.[27] Second, Videna testified that the petitioners came from a
drinking spree because he was able to smell liquor.[28] But in the report,[29] Videna
indicated that the condition of Genaro was normal. Videna did not indicate in the
report that Genaro had been drinking liquor or that Genaro was obviously
drunk. Third, Videna testified that when he arrived at the scene, Bedania was inside
his truck.[30] This contradicts the police records where Videna stated that after the
collision Bedania escaped and abandoned the victims.[31] The police records also
showed that Bedania was arrested by the police at his barracks in Anabu, Imus,
Cavite and was turned over to the police only on 26 October 1994.[32]
Under Article 2185 of the Civil Code, unless there is proof to the contrary, a person
driving a vehicle is presumed negligent if at the time of the mishap, he was violating
any traffic regulation.
In this case, the report[33] showed that the truck, while making the U-turn, failed to
signal, a violation of traffic rules. The police records also stated that, after the
collision, Bedania escaped and abandoned the petitioners and his truck.[34] This is
another violation of a traffic regulation.[35] Therefore, the presumption arises that
Bedania was negligent at the time of the mishap.
The evidence presented in this case also does not support the conclusion of the
Court of Appeals that the truck had already executed the U-turn before the impact
occurred. If the truck had fully made the U-turn, it should have been hit on its
rear.[36] If the truck had already negotiated even half of the turn and is almost on
the other side of the highway, then the truck should have been hit in the middle
portion of the trailer or cargo compartment. But the evidence clearly shows, and the
Court of Appeals even declared, that the car hit the trucks gas tank, located at the
trucks right middle portion, which disproves the conclusion of the Court of Appeals
that the truck had already executed the U-turn when it was hit by the car.
Moreover, the Court of Appeals said that the point of impact was on the lane where
the car was cruising. Therefore, the car had every right to be on that road and the
car had the right of way over the truck that was making a U-turn. Clearly, the truck
encroached upon the cars lane when it suddenly made the U-turn.
The Court of Appeals also concluded that Bedania made the U-turn at an
intersection. Again, this is not supported by the evidence on record. The police
sketch[37] does not indicate an intersection and only shows that there was a road
leading to the Orchard Golf Course near the place of the collision. Furthermore, U-
turns are generally not advisable particularly on major streets.[38] Contrary to
Videnas testimony, it is not normal for a truck to make a U-turn on a highway. We
agree with the trial court that if Bedania wanted to change direction, he should seek
an intersection where it is safer to maneuver the truck. Bedania should have also
turned on his signal lights and made sure that the highway was clear of vehicles
from the opposite direction before executing the U-turn.
The finding of the Court of Appeals that it was not yet dark when the collision
occurred is also not supported by the evidence on record. The report stated that the
daylight condition at the time of the collision was darkness.[39]
Contrary to the conclusion of the Court of Appeals, the sheer size of the truck does
not make it improbable for the truck to execute a sudden U-turn. The trial courts
decision did not state that the truck was traveling at a fast speed when it made the
U-turn. The trial court said the truck made a sudden U-turn, meaning the U-turn
was made unexpectedly and with no warning, as shown by the fact that the trucks
signal lights were not turned on.

Clearly, Bedanias negligence was the proximate cause of the collision which claimed
the life of Antero and injured the petitioners. Proximate cause is that which, in the
natural and continuous sequence, unbroken by any efficient, intervening cause,
produces the injury, and without which the result would not have occurred.[40] The
cause of the collision is traceable to the negligent act of Bedania for if the U-turn
was executed with the proper precaution, the mishap in all probability would not
have happened. The sudden U-turn of the truck without signal lights posed a serious
risk to oncoming motorists. Bedania failed to prevent or minimize that risk. The
trucks sudden U-turn triggered a series of events that led to the collision and,
ultimately, to the death of Antero and the injuries of petitioners.
award of moral damages from P50,000 to P30,000 each to Llanillo, Dignadice, and
Genaro since they only suffered physical injuries brought about by the collision.[56]
In quasi-delicts, exemplary damages may be granted if the defendant acted with
gross negligence.[57] While the amount of exemplary damages need not be proved,
the plaintiff must show that he is entitled to moral, temperate or compensatory
damages before the court may consider the question of whether or not exemplary
damages should be awarded.[58] In this case, Bedania was grossly negligent in
suddenly making a U-turn in the highway without signal lights. To serve as an
example for the public good, we affirm the trial courts award of exemplary damages
in the amount of P50,000.

We agree with the trial court that de Silva, as Bedanias employer, is also liable for
the damages suffered by petitioners. De Silva failed to prove that he exercised all
the diligence of a good father of a family in the selection and supervision of his
employees.
On the Award of Damages and Attorneys Fees
According to prevailing jurisprudence, civil indemnity for death caused by a quasi-
delict is pegged at P50,000.[41] Moral damages in the amount of P50,000 is also
awarded to the heirs of the deceased taking into consideration the pain and anguish
they suffered.[42] Bienvenido Guillang (Bienvenido), Anteros son, testified that Sofia,
Anteros wife and his mother, became depressed after Anteros death and that Sofia
died a year after.[43] Bienvenido also testified on the pain and anguish their family
suffered as a consequence of their fathers death.[44] We sustain the trial courts
award of P50,000 as indemnity for death and P50,000 as moral damages to the
heirs of Antero.
Finally, we affirm the trial courts award of attorneys fees in the amount
of P100,000. Under Article 2208 of the Civil Code, attorneys fees may be recovered
when, as in this case, exemplary damages are awarded.
WHEREFORE, we REVERSE the 3 June 2003 Decision and 23 March 2004 Resolution
of the Court of Appeals in CA-G.R. CV No.
69289. We REINSTATE with MODIFICATIONS the 5 December 2000 Decision of the
Regional Trial Court, Branch 30, Manila. We ORDER Rodolfo Bedania and Rodolfo de
Silva, jointly and severally, to pay the following amounts:
1. Funeral and Burial Expenses of P135,000 to the heirs of Antero Guillang;
2. Hospitalization Expenses of P27,000.98 to the heirs of Antero
Guillang, P10,881.60 to Alvin Llanillo, P5,436.77 to Jose Dignadice, and P300 to
Genaro Guillang; and
3. Moral damages of P30,000 each to Alvin Llanillo, Jose Dignadice, and
Genaro Guillang.
SO ORDERED.

As to funeral and burial expenses, the court can only award such amount as are
supported by proper receipts.[45] In this case, petitioners proved funeral and burial
expenses of P55,000 as evidenced by Receipt No. 1082,[46] P65,000 as evidenced by
Receipt No. 1146[47] and P15,000 as evidenced by Receipt No. 1064,[48] all issued by
the Manila South Cemetery Association, Inc., aggregating P135,000. We reduce the
trial courts award of funeral and burial expenses from P185,000 to P135,000.

As to hospitalization expenses, only substantiated and proven expenses, or those

that appear to have been genuinely incurred in connection with the hospitalization
of the victims will be recognized in court.[49] In this case, the trial court did not
specify the amount of hospitalization expenses to be awarded to the
petitioners. Since petitioners presented receipts for hospitalization expenses during
the trial, we will determine the proper amounts to be awarded to each of them. We
award hospitalization expenses of P27,000.98 to the heirs of Antero,[50] P10,881.60
to Llanillo,[51] P5,436.77 to Dignadice,[52] and P300 to Genaro[53] because these are
the amounts duly substantiated by receipts.

We affirm the trial courts award of P508,566.03 for the repair of the car. The Court
notes that there is no dispute that Genaro was driving a brand new Toyota Corolla
GLI sedan and that, after the collision, the car was a total wreck. In this case, the
repair order presented by Genaro is sufficient proof of the damages sustained by
the car.[54]

Moral damages may be recovered in quasi-delicts causing physical

injuries.[55] However, in accordance with prevailing jurisprudence, we reduce the
 EN BANC
G.R. No. L-23052 January 29, 1968
CITY OF MANILA, petitioner,
vs.
GENARO N. TEOTICO and COURT OF APPEALS, respondents.
City Fiscal Manuel T. Reyes for petitioner.
Sevilla, Daza and Associates for respondents.
CONCEPCION, C.J.:
Appeal by certiorari from a decision of the Court of Appeals.
On January 27, 1958, at about 8:00 p.m., Genaro N. Teotico was at the corner of the Old Luneta
and P. Burgos Avenue, Manila, within a "loading and unloading" zone, waiting for a jeepney to
take him down town. After waiting for about five minutes, he managed to hail a jeepney that
came along to a stop. As he stepped down from the curb to board the jeepney, and took a few
steps, he fell inside an uncovered and unlighted catch basin or manhole on P. Burgos Avenue.
Due to the fall, his head hit the rim of the manhole breaking his eyeglasses and causing broken
pieces thereof to pierce his left eyelid. As blood flowed therefrom, impairing his vision, several
persons came to his assistance and pulled him out of the manhole. One of them brought Teotico
to the Philippine General Hospital, where his injuries were treated, after which he was taken
home. In addition to the lacerated wound in his left upper eyelid, Teotico suffered contusions on
the left thigh, the left upper arm, the right leg and the upper lip apart from an abrasion on the
right infra-patella region. These injuries and the allergic eruption caused by anti-tetanus
injections administered to him in the hospital, required further medical treatment by a private
practitioner who charged therefor P1,400.00.
As a consequence of the foregoing occurrence, Teotico filed, with the Court of First Instance of
Manila, a complaint — which was, subsequently, amended — for damages against the City of
Manila, its mayor, city engineer, city health officer, city treasurer and chief of police. As stated in
the decision of the trial court, and quoted with approval by the Court of Appeals,
At the time of the incident, plaintiff was a practicing public accountant, a businessman
and a professor at the University of the East. He held responsible positions in various
business firms like the Philippine Merchandising Co., the A.U. Valencia and Co., the
Silver Swan Manufacturing Company and the Sincere Packing Corporation. He was
also associated with several civic organizations such as the Wack Wack Golf Club, the
Chamber of Commerce of the Philippines, Y's Men Club of Manila and the Knights of
Rizal. As a result of the incident, plaintiff was prevented from engaging in his
customary occupation for twenty days. Plaintiff has lost a daily income of about
P50.00 during his incapacity to work. Because of the incident, he was subjected to
humiliation and ridicule by his business associates and friends. During the period of
his treatment, plaintiff was under constant fear and anxiety for the welfare of his minor
children since he was their only support. Due to the filing of this case, plaintiff has
obligated himself to pay his counsel the sum of P2,000.00.
On the other hand, the defense presented evidence, oral and documentary, to prove
that the Storm Drain Section, Office of the City Engineer of Manila, received a report
of the uncovered condition of a catchbasin at the corner of P. Burgos and Old Luneta
Streets, Manila, on January 24, 1958, but the same was covered on the same day
(Exhibit 4); that again the iron cover of the same catch basin was reported missing on
January 30, 1958, but the said cover was replaced the next day (Exhibit 5); that the
Office of the City Engineer never received any report to the effect that the catchbasin
in question was not covered between January 25 and 29, 1968; that it has always
been a policy of the said office, which is charged with the duty of installation, repair
and care of storm drains in the City of Manila, that whenever a report is received from
whatever source of the loss of a catchbasin cover, the matter is immediately attended
to, either by immediately replacing the missing cover or covering the catchbasin with
steel matting that because of the lucrative scrap iron business then prevailing, stealing
of iron catchbasin covers was rampant; that the Office of the City Engineer has filed
complaints in court resulting from theft of said iron covers; that in order to prevent
such thefts, the city government has changed the position and layout of catchbasins in
the City by constructing them under the sidewalks with concrete cement covers and
openings on the side of the gutter; and that these changes had been undertaken by
the city from time to time whenever funds were available.
After appropriate proceedings the Court of First Instance of Manila rendered the aforementioned
decision sustaining the theory of the defendants and dismissing the amended complaint, without
costs.
On appeal taken by plaintiff, this decision was affirmed by the Court of Appeals, except insofar
as the City of Manila is concerned, which was sentenced to pay damages in the aggregate sum
of P6,750.00. 1 Hence, this appeal by the City of Manila.
The first issue raised by the latter is whether the present case is governed by Section 4 of
Republic Act No. 409 (Charter of the City of Manila) reading:
The city shall not be liable or held for damages or injuries to persons or property
arising from the failure of the Mayor, the Municipal Board, or any other city officer, to
enforce the provisions of this chapter, or any other law or ordinance, or from
negligence of said Mayor, Municipal Board, or other officers while enforcing or
attempting to enforce said provisions.
or by Article 2189 of the Civil Code of the Philippines which provides:
Provinces, cities and municipalities shall be liable for damages for the death of, or
injuries suffered by, any person by reason of defective conditions of road, streets,
bridges, public buildings, and other public works under their control or supervision.
Manila maintains that the former provision should prevail over the latter, because Republic Act
409, is a special law, intended exclusively for the City of Manila, whereas the Civil Code is a
general law, applicable to the entire Philippines.
The Court of Appeals, however, applied the Civil Code, and, we think, correctly. It is true that,
insofar as its territorial application is concerned, Republic Act No. 409 is a special law and the
Civil Code a general legislation; but, as regards the subject-matter of the provisions above
quoted, Section 4 of Republic Act 409 establishes a general rule regulating the liability of the
City of Manila for: "damages or injury to persons or property arising from the failure of" city
officers "to enforce the provisions of" said Act "or any other law or ordinance, or from
negligence" of the city "Mayor, Municipal Board, or other officers while enforcing or attempting to
enforce said provisions." Upon the other hand, Article 2189 of the Civil Code constitutes a
particular prescription making "provinces, cities and municipalities . . . liable for damages for the
death of, or injury suffered by any person by reason" — specifically — "of the defective condition
of roads, streets, bridges, public buildings, and other-public works under their control or
supervision." In other words, said section 4 refers to liability arising from negligence, in general,
regardless of the object thereof, whereas Article 2189 governs liability due to "defective streets," railroad companies to fence their property, or any part thereof, to provide suitable
in particular. Since the present action is based upon the alleged defective condition of a road, protection against injury to persons or property, and to construct and repair ditches,
said Article 2189 is decisive thereon. drains, sewers, and culverts along and under their tracks, so that the natural drainage
of the streets and adjacent property shall not be obstructed.
It is urged that the City of Manila cannot be held liable to Teotico for damages: 1) because the
accident involving him took place in a national highway; and 2) because the City of Manila has This authority has been neither withdrawn nor restricted by Republic Act No. 917 and Executive
not been negligent in connection therewith. Order No. 113, dated May 2, 1955, upon which the City relies. Said Act governs the disposition
or appropriation of the highway funds and the giving of aid to provinces, chartered cities and
municipalities in the construction of roads and streets within their respective boundaries, and
As regards the first issue, we note that it is based upon an allegation of fact not made in the
Executive Order No. 113 merely implements the provisions of said Republic Act No. 917,
answer of the City. Moreover, Teotico alleged in his complaint, as well as in his amended
concerning the disposition and appropriation of the highway funds. Moreover, it provides that
complaint, that his injuries were due to the defective condition of a street which is "under the
"the construction, maintenance and improvement of national primary, national secondary and
supervision and control" of the City. In its answer to the amended complaint, the City, in turn,
national aid provincial and city roads shall be accomplished by the Highway District Engineers
alleged that "the streets aforementioned were and have been constantly kept in good condition
and Highway City Engineers under the supervision of the Commissioner of Public Highways and
and regularly inspected and the storm drains and manholes thereof covered by the defendant
shall be financed from such appropriations as may be authorized by the Republic of the
City and the officers concerned" who "have been ever vigilant and zealous in the performance of
Philippines in annual or special appropriation Acts."
their respective functions and duties as imposed upon them by law." Thus, the City had, in
effect, admitted that P. Burgos Avenue was and is under its control and supervision.
Then, again, the determination of whether or not P. Burgos Avenue is under the control or
supervision of the City of Manila and whether the latter is guilty of negligence, in connection with
Moreover, the assertion to the effect that said Avenue is a national highway was made, for
the maintenance of said road, which were decided by the Court of Appeals in the affirmative, is
the first time, in its motion for reconsideration of the decision of the Court of Appeals. Such
one of fact, and the findings of said Court thereon are not subject to our review.
assertion raised, therefore, a question of fact, which had not been put in issue in the trial court,
and cannot be set up, for the first time, on appeal, much less after the rendition of the decision of
the appellate court, in a motion for the reconsideration thereof. WHEREFORE, the decision appealed from should be as it is hereby affirmed, with costs against
the City of Manila. It is so ordered.1äwph
At any rate, under Article 2189 of the Civil Code, it is not necessary for the liability therein
established to attach that the defective roads or streets belong to the province, city or
municipality from which responsibility is exacted. What said article requires is that the province,
city or municipality have either "control or supervision" over said street or road. Even if P. Burgos
Avenue were, therefore, a national highway, this circumstance would not necessarily detract
from its "control or supervision" by the City of Manila, under Republic Act 409. In fact Section
18(x) thereof provides:

Sec. 18. Legislative powers. — The Municipal Board shall have the following
legislative powers:

xxx xxx xxx

(x) Subject to the provisions of existing law to provide for the laying out,
construction and improvement, and to regulate the use of streets, avenues, alleys,
sidewalks, wharves, piers, parks, cemeteries, and other public places; to provide for
lighting, cleaning, and sprinkling of streets and public places; . . . to provide for the
inspection of, fix the license fees for and regulate the openings in the same for the
laying of gas, water, sewer and other pipes, the building and repair of tunnels, sewers,
and drains, and all structures in and under the same and the erecting of poles and the
stringing of wires therein; to provide for and regulate cross-works, curbs, and gutters
therein, . . . to regulate traffic and sales upon the streets and other public places; to
provide for the abatement of nuisances in the same and punish the authors or owners
thereof; to provide for the construction and maintenance, and regulate the use, of
bridges, viaducts and culverts; to prohibit and regulate ball playing, kite-flying, hoop
rolling, and other amusements which may annoy persons using the streets and public
places, or frighten horses or other animals; to regulate the speed of horses and other
animals, motor and other vehicles, cars, and locomotives within the limits of the city;
to regulate the lights used on all vehicles, cars, and locomotives; . . . to provide for and
change the location, grade, and crossing of railroads, and compel any such railroad to
raise or lower its tracks to conform to such provisions or changes; and to require
 FIRST DIVISION hence, the complaint was seasonably filed. Subsequent related pleadings were thereafter filed
by the parties. 5
G.R. No. 110295 October 18, 1993
In its Order of 23 January 1991, 6 the trial court granted the motion to dismiss. It ruled that the
doctrine of exhaustion of administrative remedies does not apply as the existing administrative
COCA-COLA BOTTLERS PHILIPPINES, INC.,
remedy is not adequate. It also stated that the complaint is based on a contract, and not
vs.
on quasi-delict, as there exists pre-existing contractual relation between the parties; thus, on the
basis of Article 1571, in relation to Article 1562, the complaint should have been filed within six
THE HONORABLE COURT OF APPEALS (Fifth Division) and MS. LYDIA GERONIMO, months from the delivery of the thing sold.
respondents.
Her motion for the reconsideration of the order having been denied by the trial court in its Order
Angara, Abello, Concepcion, Regala & Cruz Law Offices for petitioner. of 17 April 1991, 7the private respondent came to this Court via a petition for review
on certiorari which we referred to the public respondent "for proper determination and
disposition. 8 The public respondent docketed the case as CA-G.R. SP No. 25391.
Alejandro M. Villamil for private respondent.

In a decision promulgated on 28 January 1992, 9 the public respondent annulled the questioned
DAVIDE, JR., J.:
orders of the RTC and directed it to conduct further proceedings in Civil Case No. D-9629. In
holding for the private respondent, it ruled that:
This case concerns the proprietress of a school canteen which had to close down as a
consequence of the big drop in its sales of soft drinks triggered by the discovery of foreign
Petitioner's complaint being one for quasi-delict, and not for breach of
substances in certain beverages sold by it. The interesting issue posed is whether the warranty as respondent contends, the applicable prescriptive period is four
subsequent action for damages by the proprietress against the soft drinks manufacturer should years.
be treated as one for breach of implied warranty against hidden defects or merchantability, as
claimed by the manufacturer, the petitioner herein which must therefore be filed within six
months from the delivery of the thing sold pursuant to Article 1571 of the Civil Code, or one It should be stressed that the allegations in the complaint plainly show that it
for quasi-delict, as held by the public respondent, which can be filed within four years pursuant is an action or damages arising from respondent's act of "recklessly and
to Article 1146 of the same Code. negligently manufacturing adulterated food items intended to be sold or
public consumption" (p. 25, rollo). It is truism in legal procedure that what
determines the nature of an action are the facts alleged in the complaint and
On 7 May 1990, Lydia L. Geronimo, the herein private respondent, filed a complaint for damages
those averred as a defense in the defendant's answer (I Moran 126; Calo v.
against petitioner with the Regional Trial Court (RTC) of Dagupan City. 1 The case was docketed Roldan, 76 Phil. 445; Alger Electric, Inc. v. CA, 135 SCRA 340).
as Civil Case No. D-9629. She alleges in her complaint that she was the proprietress of
Kindergarten Wonderland Canteen docketed as located in Dagupan City, an enterprise engaged
in the sale of soft drinks (including Coke and Sprite) and other goods to the students of Secondly, despite the literal wording of Article 2176 of the Civil code, the
Kindergarten Wonderland and to the public; on or about 12 August 1989, some parents of the existence of contractual relations between the parties does not absolutely
students complained to her that the Coke and Sprite soft drinks sold by her contained fiber-like preclude an action by one against the other for quasi-delict arising from
matter and other foreign substances or particles; he then went over her stock of softdrinks and negligence in the performance of a contract.
discovered the presence of some fiber-like substances in the contents of some unopened Coke
bottles and a plastic matter in the contents of an unopened Sprite bottle; she brought the said
In Singson v. Court of Appeals (23 SCRA 1117), the Supreme Court ruled:
bottles to the Regional Health Office of the Department of Health at San Fernando, La Union, for
examination; subsequently, she received a letter from the Department of Health informing her
that the samples she submitted "are adulterated;" as a consequence of the discovery of the It has been repeatedly held: that the existence of a
foreign substances in the beverages, her sales of soft drinks severely plummeted from the usual contract between the parties does not bar the
10 cases per day to as low as 2 to 3 cases per day resulting in losses of from P200.00 to commission of a tort by the one against the other and
P300.00 per day, and not long after that she had to lose shop on 12 December 1989; she the consequent recovery of damages therefor
became jobless and destitute; she demanded from the petitioner the payment of damages but . . . . Thus in Air France vs. Carrascoso, . . . (it was held
was rebuffed by it. She prayed for judgment ordering the petitioner to pay her P5,000.00 as that) although the relation between a passenger and a
actual damages, P72,000.00 as compensatory damages, P500,000.00 as moral damages, carrier is "contractual both in origin and in nature the
P10,000.00 as exemplary damages, the amount equal to 30% of the damages awarded as act that breaks the contract may also be a tort.
attorney's fees, and the costs. 2
Significantly, in American jurisprudence, from which Our law on Sales was
The petitioner moved to dismiss 3 the complaint on the grounds of failure to exhaust taken, the authorities are one in saying that he availability of an action or
administrative remedies and prescription. Anent the latter ground, the petitioner argued that breach of warranty does not bar an action for torts in a sale of defective
since the complaint is for breach of warranty under Article 1561 of the said Code. In her goods. 10
Comment 4 thereto, private respondent alleged that the complaint is one for damages which
does not involve an administrative action and that her cause of action is based on an injury to
plaintiff's right which can be brought within four years pursuant to Article 1146 of the Civil Code;
Its motion for the reconsideration of the decision having been denied by the public respondent in
its Resolution of 14 May 1993, 11 the petitioner took his recourse under Rule 45 of the Revised
Rules of Court. It alleges in its petition that:
I.
THE HONORABLE COURT OF APPEALS COMMITTED A GRAVE AND
REVERSIBLE ERROR IN RULING THAT ARTICLE 2176, THE GENERAL
PROVISION ON QUASI-DELICTS, IS APPLICABLE IN THIS CASE WHEN
THE ALLEGATIONS OF THE COMPLAINT CLEARLY SHOW THAT
PRIVATE RESPONDENT'S CAUSE OF ACTION IS BASEDON BREACH
OF A SELLER'S IMPLIED WARRANTIES UNDER OUR LAW ON SALES.
II.
CORROLARILY, THE HONORABLE COURT OF APPEALS COMMITTED
A GRAVE AND REVERSIBLE ERROR IN OVERRULING PETITIONER'S
ARGUMENT THAT PRIVATE RESPONDENT'S CAUSE OF ACTION HAD
PRESCRIBED UNDER ARTICLE 1571 OF THE CIVIL CODE. 12
The petitioner insists that a cursory reading of the complaint will reveal that the primary legal
basis for private respondent's cause of action is not Article 2176 of the Civil Code on quasi-
delict — for the complaint does not ascribe any tortious or wrongful conduct on its part — but
Articles 1561 and 1562 thereof on breach of a seller's implied warranties under the law on sales.
It contends the existence of a contractual relation between the parties (arising from the contract
of sale) bars the application of the law on quasi-delicts and that since private respondent's cause
of action arose from the breach of implied warranties, the complaint should have been filed
within six months room delivery of the soft drinks pursuant to Article 171 of the Civil Code.
The vendee may also ask for the annulment of the contract upon proof of error or fraud, in which
case the ordinary rule on obligations shall be applicable. 14 Under the law on obligations,
responsibility arising from fraud is demandable in all obligations and any waiver of an action for
future fraud is void. Responsibility arising from negligence is also demandable in any obligation,
but such liability may be regulated by the courts, according to the circumstances. 15 Those guilty
of fraud, negligence, or delay in the performance of their obligations and those who in any
manner contravene the tenor thereof are liable for damages. 16
The vendor could likewise be liable for quasi-delict under Article 2176 of the Civil Code, and an
action based thereon may be brought by the vendee. While it may be true that the pre-existing
contract between the parties may, as a general rule, bar the applicability of the law on quasi-
delict, the liability may itself be deemed to arise fromquasi-delict, i.e., the acts which breaks the
contract may also be a quasi-delict. Thus, in Singson vs. Bank of the Philippine Islands, 17 this
Court stated:
We have repeatedly held, however, that the existence of a contract between
the parties does not bar the commission of a tort by the one against the
other and the consequent recovery of damages therefor. 18 Indeed, this view
has been, in effect, reiterated in a comparatively recent case. Thus, in Air
France vs. Carrascoso, 19 involving an airplane passenger who, despite hi
first-class ticket, had been illegally ousted from his first-class
accommodation and compelled to take a seat in the tourist compartment,
was held entitled to recover damages from the air-carrier, upon the ground
of tort on the latter's part, for, although the relation between the passenger
and a carrier is "contractual both in origin and nature . . . the act that breaks
the contract may also be a tort.
Otherwise put, liability for quasi-delict may still exist despite the presence of
contractual relations. 20

In her Comment the private respondent argues that in case of breach of the seller's implied Under American law, the liabilities of a manufacturer or seller of injury-causing
warranties, the vendee may, under Article 1567 of the Civil Code, elect between withdrawing products may be based on negligence, 21 breach of warranty, 22 tort, 23 or other
from the contract or demanding a proportionate reduction of the price, with damages in either grounds such as fraud, deceit, or misrepresentation. 24Quasi-delict, as defined in
case. She asserts that Civil Case No. D-9629 is neither an action for rescission nor for Article 2176 of the Civil Code, (which is known in Spanish legal treaties as culpa
proportionate reduction of the price, but for damages arising from a quasi-delict and that the aquiliana, culpa extra-contractual or cuasi-delitos) 25 is homologous but not identical to
public respondent was correct in ruling that the existence of a contract did not preclude the tort under the common law, 26 which includes not only negligence, but also intentional
action for quasi-delict. As to the issue of prescription, the private respondent insists that since criminal acts, such as assault and battery, false imprisonment and deceit. 27
her cause of action is based on quasi-delict, the prescriptive period therefore is four (4) years in
accordance with Article 1144 of the Civil Code and thus the filing of the complaint was well within
It must be made clear that our affirmance of the decision of the public respondent should by no
the said period.
means be understood as suggesting that the private respondent's claims for moral damages
have sufficient factual and legal basis.
We find no merit in the petition. The public respondent's conclusion that the cause of action in
Civil Case No. D-9629 is found on quasi-delict and that, therefore, pursuant to Article 1146 of the
IN VIEW OF ALL THE FOREGOING, the instant petition is hereby DENIED for lack of merit, with
Civil Code, it prescribes in four (4) years is supported by the allegations in the complaint, more
costs against the petitioner.
particularly paragraph 12 thereof, which makes reference to the reckless and negligent
manufacture of "adulterated food items intended to be sold for public consumption."
SO ORDERED.
The vendee's remedies against a vendor with respect to the warranties against hidden defects of
or encumbrances upon the thing sold are not limited to those prescribed in Article 1567 of the
Civil Code which provides:

Art. 1567. In the case of Articles 1561, 1562, 1564, 1565 and 1566, the
vendee may elect between withdrawing from the contract and demanding a
proportionate reduction of the price, with damages either
case. 13
 SECOND DIVISION
G.R. No. L-41767 August 23, 1978
MR. AND MRS. ROMEO FERRER and ANNETTE FERRER, petitioners,
vs.
HON. VICENTE G. ERICTA, in his capacity as Presiding Judge of the Court of First
Instance of Rizal, Quezon City, Branch XVIII, MR. AND MRS. FRANCIS PFLEIDER and
DENNIS PFLEIDER, respondents.
Delano F. Villaruz for petitioners.
Porderio C. David for private respondents.
ANTONIO, J:
Mandamus to compel the immediate execution of the Decision of the Court of First Instance of
Quezon City, Branch XVIII, presided over by respondent Judge, in Civil Case No. Q-19647,
dated July 21, 1975. The pertinent facts are as follows:
In a complaint for damages against respondents, dated December 27, 1974 but actually filed on
January 6, 1975 (Civil Case No. Q-19647), and assigned to the sala of respondent Judge, it was
alleged that defendants Mr. and Mrs. Francis Pfleider, residents of Bayawan, Negros Oriental,
were the owners or operators of a Ford pick-up car; that at about 5:00 o'clock in the afternoon of
December 31, 1970, in the streets of Bayawan, Negros Oriental, their son, defendant Dennis
Pfleider, who was then only sixteen (16) years of age, without proper official authority, drove the
above-described vehicle, without due regard to traffic rules and regulations, and without taking
the necessary precaution to prevent injury to persons or damage to property, and as a
consequence the pickup car was overturned, causing physical injuries to plaintiff Annette Ferrer,
who was then a passenger therein, which injuries paralyzed her and required medical treatment
and confinement at different hospitals for more than two (2) years; that as a result of the physical
injuries sustained by Annette, she suffered unimaginable physical pain, mental anguish, and her
parents also suffered mental anguish, moral shock and spent a considerable sum of money for
her treatment. They prayed that defendants be ordered to reimburse them for actual expenses
as well as other damages.
In due time, defendants filed their answer, putting up the affirmative defense that defendant
Dennis Pfleider exercised due care and utmost diligence in driving the vehicle aforementioned
and alleging that Annette Ferrer and the other persons aboard said vehicle were not passengers
in the strict sense of the term, but were merely joy riders and that, consequently, defendants had
no obligation whatsoever to plaintiffs.
At the pre-trial on May 12, 1975, only plaintiffs-petitioners and their counsel were present.
Consequently, defendants-private respondents were declared in default and the plaintiff
petitioners were allowed to present their evidence ex parte. On May 21, 1975, petitioners moved
that they be granted an extension of ten (10) days from May 22, 1975 to present her evidence,
which was granted by the court a quo. The presentation of petitioners' evidence was later
continued by the trial court to June 16, 1975, when the deposition of Annette Ferrer was
submitted by petitioners and admitted by the trial court.
On June 26, 1975, private respondents filed a motion to "set aside the order of default and
subsequent pleadings" on the ground that "defendants' failure to appear for pre-trial was due to
accident or excusable neglect." This was opposed by petitioners on the ground that the said
pleading was not under oath, contrary to the requirements of Sec. 3, Rule 18 of the Rules, and
that it was not accompanied by an affidavit of merit showing that the defendants have a good
defense. In view of this, the motion of private respondents was denied by respondent Judge on
July 21, 1975. On the same date, respondent Judge rendered judgment against private
respondents, finding that the minor Dennis Pfleider, was allowed by his parents to operate a
Ford pick-up car and because of his reckless negligence caused the accident in question,
resulting in injuries to Annette, and ordering the defendants, as a result thereof, to pay jointly
and severally the plaintiffs the following amounts: (1) P24,500.00 for actual expenses,
hospitalization and medical expenses; (2) P24,000.00 for actual expenses for the care,
medicines of plaintiff Annette for helps from December 31, 1970 to December 31, 1974; (3)
P50,000.00 for moral damages; (4) P10,000.00 for exemplary damages; (5) P5,000.00 for
attorney's fees; and (6) costs of suit.
On September 1, 1975, private respondents filed a Motion for Reconsideration 1 of the decision
and of the order denying the motion to set aside order of default, based on the following
grounds: (1) the complaint states no cause of action insofar as Mr. and Mrs. Pfleider are
concerned because it does not allege that at the time of the mishap, defendant Dennis Pfleider
was living with them, the fact being that at such time he was living apart from them, hence, there
can be no application of Article 2180 of the Civil Code, upon which parents' liability is premised;
and (2) that tile complaint shows on its face "that it was filed only on January 6, 1975, or after
the lapse of MORE THAN FOUR YEARS from the date of the accident on December 31, 1970",
likewise appearing from the complaint and, therefore, the action has already prescribed under
Article 1146 of the Civil Code.
A Supplemental Motion for Reconsideration 2 was subsequently filed by defendants-private
respondents on September 10, 1975, alleging that their defense of prescription has not been
waived and may be raised even at such stage of the proceedings because on the face of the
complaint, as well as from the plaintiff's evidence, their cause of action had already prescribed,
citing as authority the decision of this Court in Philippine National Bank v. Pacific Commission
House, 3 as well as the decisions quoted therein. The Opposition 4 to the above supplemental
motion interposed by plaintiffs-petitioners averred that: (a) the defense of prescription had been
waived while the defense that the complaint states no cause of action "is available only at any
time not later than the trial and prior to the decision"; (b) inasmuch as defendants have been
declared in default for failure to appear at the pretrial conference, they have lost their standing in
court and cannot be allowed to adduce evidence nor to take part in the trial, in accordance with
Section 2 of Rule 18 of the Rules of Court; and (c) the motion and supplemental motion for
reconsideration are pro forma because the defenses raised therein have been previously raised
and passed upon by respondent court in resolving defendants' motion to set aside order of
default. Being pro forma, said motion and supplemental motion do not suspend the running of
the thirty-day period to appeal, which was from August 5, 1975, when defendants received a
copy of the decision, to September 4, 1975, and hence the decision has already become final
and executory. Plaintiffs-petitioners accordingly prayed that a writ of execution be issued to
enforce the judgment in their favor.
On September 23, 1975, respondent judge, without setting aside the order of default, issued an
order absolving defendants from any liability on the grounds that: (a) the complaint states no
cause of action because it does not allege that Dennis Pfleider was living with his parents at the
time of the vehicular accident, considering that under Article 2180 of the Civil Code, the father
and, in case of his death or incapacity the mother, are only responsible for the damages caused
by their minor children who live in their company; and (b) that the defense of prescription is
meritorious, since the complaint was filed more than four (4) years after the date of the accident,
and the action to recover damages based on quasi-delict prescribes in four (4) years. Hence, the
instant petition for mandamus.
The basic issue is whether the defense of prescription had been deemed waived by private
respondents' failure to allege the same in their answer.

As early as Chua Lamko v. Dioso, et al., 5 this Court sustained the dismissal of a counterclaim
on the ground of prescription, although such defense was not raised in the answer of the
plaintiff. Thus, this Court held that where the answer does not take issue with the complaint as to
dates involved in the defendant's claim of prescription, his failure to specifically plead
prescription in the answer does not constitute a waiver of the defense of prescription. It was
explained that the defense of prescription, even if not raised in a motion to dismiss or in the
answer, is not deemed waived unless such defense raises issues of fact not appearing upon the
preceding pleading.

In Philippine National Bank v. Perez, et al.,6 which was an action filed by the Philippine National
Bank on March 22, 1961 for revival of a judgment rendered on December 29, 1949 against
Amando Perez, Gregorio Pumuntoc and Virginia de Pumuntoc pursuant to Section 6, Rule 39 of
the rules of court the defendants were declared in default for their failure to file their answer.
There upon, the plaintiff submitted its evidence, but when the case was submitted for decision,
the court a quo dismissed the complaint on the ground that plaintiff's cause of action had already
prescribed under Articles 1144 and 1152 of the Civil Code. The plaintiff in said case, contending
that since prescription is a defense that can only be set up by defendants, the court could
not motu proprio consider it as a basis for dismissal, moved to reconsider the order, but its
motion was denied. When the issue was raised to this Court, We ruled:

It is true that the defense of prescription can only be considered if the same
is invoked as such in the answer of the defendant and that in this particular
instance no such defense was invoked because the defendants had been
declared in default, but such rule does riot obtain when the evidence shows
that the cause of action upon which plaintiff's complaint is based is already
barred by the statute of limitations. (Emphasis supplied.)

Again, in Philippine National Bank v. Pacific Commission House, 7 where the action sought to
revive a judgment rendered by the Court of First Instance of Manila on February 3, 1953 and it
was patent from the stamp appearing on the first page of the complaint that the complaint was
actually filed on May 31, 1963, this Court sustained the dismissal of the complaint on the ground
of prescription, although such defense was not raised in the answer, overruling the appellants'
invocation of Section 2 of Rule 9 of the Rules of Court that "defenses and objections not pleaded
either in a motion to dismiss or in tile answer are deemed waived." We held therein that "... the
fact that the plaintiff's own allegation in tile complaint or the evidence it presented shows clearly
that the action had prescribed removes this case from the rule regarding waiver of the defense
by failure to plead the same."

In the present case, there is no issue of fact involved in connection with the question of
prescription. The complaint in Civil Case No. Q-19647 alleges that the accident which caused
the injuries sustained by plaintiff Annette Ferrer occured on December 31, 1970. It is undisputed
that the action for damages was only filed on January 6, 1975. Actions for damages arising from
physical injuries because of a tort must be filed within four years. 8 The four-year period begins
from the day the quasi-delict is committed or the date of the accident. 9

WHEREFORE, the instant petition for mandamus is hereby DISMISSED, without

pronouncement as to costs.
 [G.R. No. 102998. July 5, 1996]
BA FINANCE CORPORATION, petitioner vs. HON. COURT OF APPEALS and ROBERTO M.
REYES, respondents.
DECISION
VITUG, J.:
The case at bar is a suit for replevin and damages. The petition for review
on certiorari assails the decision of the Court of Appeals[1] in CA- G.R. CV No. 23605 affirming
that of the Regional Trial Court of Manila, Branch XX, [2] which has disposed of its Civil Case No.
87-42270 in this wise:
"WHEREFORE, the case against defendant-spouses (sic) Reynaldo Manahan is hereby dismissed without
prejudice, for failure to prosecute. Plaintiff having failed to show the liability of defendant John Doe in the
person of Roberto M. Reyes, the case against the latter should likewise be dismissed. Moreover, plaintiff
is hereby directed to return the vehicle seized by virtue of the order of seizure issued by this Court with all
its accessories to the said Roberto M. Reyes."[3]
The decisions of both the appellate court and the court a quo are based on a like finding of
the facts hereinafter briefly narrated.
The spouses Reynaldo and Florencia Manahan executed, on 15 May 1980, a promissory
note[4] binding themselves to pay Carmasters, Inc., the amount of P83,080.00 in thirty-six
monthly installments commencing 01 July 1980. To secure payment, the Manahan spouses
executed a deed of chattel mortgage[5] over a motor vehicle, a Ford Cortina 1.6 GL, with motor
and serial number CUBFWE-801010. Carmasters later assigned[6] the promissory note and the
chattel mortgage to petitioner BA Finance Corporation with the conformity of the
Manahans.When the latter failed to pay the due installments, petitioner sent demand letters. The
demands not having been heeded, petitioner, on 02 October 1987, filed a complaint for replevin
with damages against the spouses, as well as against a John Doe, praying for the recovery of
the vehicle with an alternative prayer for the payment of a sum of money should the vehicle not
be returned. Upon petitioner's motion and the filing of a bond in the amount of P169,161.00, the
lower court issued a writ of replevin. The court, however, cautioned petitioner that should
summons be not served on the defendants within thirty (30) days from the writ's issuance, the
case would be dismissed for failure to prosecute.[7] The warning was based on what the court
perceived to be the deplorable practice of some mortgagees of "freezing (the) foreclosure or
replevin cases" which they would so "conveniently utilize as a leverage for the collection of
unpaid installments on mortgaged chattels."[8]
The service of summons upon the spouses Manahan was caused to be served by
petitioner at No. 35 Lantana St., Cubao, Quezon City. The original of the summons had the
name and the signature of private respondent Roberto M. Reyes indicating that he received, on
14 October 1987, a copy of the summons and the complaint.[9] Forthwith, petitioner, through its
Legal Assistant, Danilo E. Solano, issued a certification to the effect that it had received from
Orson R. Santiago, the deputy sheriff of the Regional Trial Court of Manila, Branch 20, the Ford
Cortina seized from private respondent Roberto M. Reyes, the John Doe referred to in the
complaint,[10] in Sorsogon, Sorsogon.[11] On 20 October 1987, the lower court came out with an
order of seizure.
Alleging possession in good faith, private respondent filed, on 26 October 1987, a motion
for an extension of time within which to file his answer and/or a motion for intervention. The court
granted the motion.
A few months later, or on 18 February 1988, the court issued an order which, in part,
stated:
"Perusal of the record shows that an order for the seizure of personal property was issued on October 20,
1987 in pursuance to a previous order of the Court dated October 13, 1987. However, to date, there is no
showing that the principal defendants were served with summons inspite of the lapse of four (4) months.
"Considering, this is a replevin case and to forestall the evils that arise from this practice, plaintiff failing
to heed the Order dated October 13, 1987, particularly second paragraph thereof, the above-entitled case is
hereby ordered DISMISSED for failure to prosecute and further ordering the plaintiff to return the
property seized with all its accessories to defendant John Doe in the person of Roberto M. Reyes.
"SO ORDERED."[12]
On 26 February 1988, petitioner filed a notice of dismissal of the case "without prejudice
and without pronouncement as to costs, before service of Summons and Answer, under Section
1, Rule 17, of the Rules of Court."[13] It also sought in another motion the withdrawal of the
replevin bond. In view of the earlier dismissal of the case (for petitioner's failure to prosecute),
the court, on 02 March 1988, merely noted the notice of dismissal and denied the motion to
withdraw the replevin bond considering that the writ of replevin had meanwhile been
implemented.[14]
On 09 March 1988, private respondent filed a motion praying that petitioner be directed to
comply with the court order requiring petitioner to return the vehicle to him. In turn, petitioner
filed, on 14 March 1988, a motion for the reconsideration of the orders of 18 February 1988 and
02 March 1988 contending that: (a) the dismissal of the case was tantamount to adjudication on
the merits that thereby deprived it with the remedy to enforce the promissory note, the chattel
mortgage and the deed of assignment, under Section 3, Rule 117, of the Rules of Court; (b) the
order to return the vehicle to private respondent was a departure from jurisprudence recognizing
the right of the mortgagor to foreclose the property to respond to the unpaid obligation secured
by the chattel mortgage, and (c) there were no legal and factual bases for the court's view that
the filing of the replevin case was "characterized (by) evil practices."[15]
On 20 April 1988, the court granted petitioner's motion for reconsideration and accordingly
recalled the order directing the return of the vehicle to private respondent, set aside the order
dismissing the case, directed petitioner "to cause the service of summons together with a copy
of the complaint on the principal defendants within five (5) days from receipt"[16] thereof at
petitioner's expense, and ordered private respondent to answer the complaint.
A few months later, or on 02 August 1988, petitioner filed a motion to declare private
respondent in default. The court granted the motion on that same day and declared private
respondent "in default for his failure to file the x x x answer within the reglementary
period."[17] The court likewise granted petitioner's motion to set the case for the presentation, ex
parte, of evidence. Petitioner, thereupon, submitted the promissory note, the deed of chattel
mortgage, the deed of assignment, a statement of account in the name of Florencia Manahan
and two demand letters.
On 27 February 1989, the trial court rendered a decision dismissing the complaint against
the Manahans for failure of petitioner to prosecute the case against them. It also dismissed the
case against private respondent for failure of petitioner to show any legal basis for said
respondent's liability. The court ratiocinated:
"x x x. Roberto M. Reyes is merely ancillary debtor in this case. The defendant spouses Manahan being
the principal debtor(s) and as there is no showing that the latter has been brought before the jurisdiction of
this court, it must necessarily follow that the plaintiff has no cause of action against said Roberto M.
Reyes herein before referred to as defendant John Doe. Under the circumstances, it is incumbent upon the
plaintiff to return the seized vehicle unto the said Roberto M. Reyes."[18]
In its appeal to the Court of Appeals, petitioner has asserted that a suit for replevin aimed
at the foreclosure of the chattel is an action quasi in rem which does not necessitate the
presence of the principal obligors as long as the court does not render any personal judgment
against them. This argument did not persuade the appellate court, the latter holding that-
"x x x. In action quasi in rem an individual is named as defendant and the purpose of the proceeding is to
subject his interest therein to the obligation or lien burdening the property, such as proceedings having for
their sole object the sale or disposition of the property of the defendant, whether by attachment,
foreclosure, or other form of remedy (Sandejas vs. Robles, 81 Phil. 421). In the case at bar, the court
cannot render any judgment binding on the defendants spouses for having allegedly violated the terms and
conditions of the promissory note and the contract of chattel mortgage on the ground that the court has no
jurisdiction over their persons, no summons having been served on them. That judgment, if rendered, is
void for having denied the defendants spouses due process of law which contemplates notice and
opportunity to be heard before judgment is rendered, affecting one's person or property (Macabingkil vs.
Yatco, 26 SCRA 150, 157).
"It is next contended by appellant that as between appellant, as mortgagee, and John Doe, whose right to
possession is dubious if not totally non-existent, it is the former which has the superior right of possession.
"We cannot agree.
"It is an undisputed fact that the subject motor vehicle was taken from the possession of said Roberto M.
Reyes, a third person with respect to the contract of chattel mortgage between the appellant and the
defendants spouses Manahan.
"The Civil Code expressly provides that every possessor has a right to be respected in his possession (Art.
539, New Civil Code); that good faith is always presumed, and upon him who alleges bad faith on the part
of a possessor rests the burden of proof (Art. 527, ibid.); and that the possession of movable property
acquired in good faith is equivalent to a title; nevertheless, one who has lost any movable or has been
unlawfully deprived thereof, may recover it from the person in possession of the same (Art. 559,
ibid.). Thus, it has been held that a possessor in good faith is entitled to be respected and protected in his
possession as if he were the true owner thereof until a competent court rules otherwise (Chus Hai vs.
Kapunan, 104 Phil. 110; Yu, et al. vs. Hon. Honrado, etc., et al., 99 SCRA 237). In the case at bar, the trial
court did not err in holding that the complaint does not state any cause of action against Roberto M.
Reyes, and in ordering the return of the subject chattel to him."[19]
The appellate court, subsequently, denied petitioner's motion for reconsideration.
In the instant appeal, petitioner insists that a mortgagee can maintain an action for
replevin against any possessor of the object of a chattel mortgage even if the latter were not a
party to the mortgage.
Replevin, broadly understood, is both a form of principal remedy and of a provisional
relief. It may refer either to the action itself, i.e., to regain the possession of personal chattels
being wrongfully detained from the plaintiff by another, or to the provisional remedy that would
allow the plaintiff to retain the thing during the pendency of the action and hold it pendente
lite.[20]The action is primarily possessory in nature and generally determines nothing more than
the right of possession. Replevin is so usually described as a mixed action, being partly in
rem and partly in personam-in rem insofar as the recovery of specific property is concerned,
and in personam as regards to damages involved. As an "action in rem," the gist of the replevin
action is the right of the plaintiff to obtain possession of specific personal property by reason of
his being the owner or of his having a special interest therein. [21] Consequently, the person in
possession of the property sought to be replevied is ordinarily the proper and only necessary
party defendant, and the plaintiff is not required to so join as defendants other persons claiming
a right on the property but not in possession thereof. Rule 60 of the Rules of Court allows an
application for the immediate possession of the property but the plaintiff must show that he has a
good legal basis, i.e., a clear title thereto, for seeking such interim possession.
Where the right of the plaintiff to the possession of the specific property is so conceded or
evident, the action need only be maintained against him who so possesses the property. In rem
actio est per quam rem nostram quae ab alio possidetur petimus, et semper adversus eum est
qui rem possidet. In Northern Motors, Inc. vs. Herrera,[22] the Court has said:
"There can be no question that persons having a special right of property in the goods the recovery of
which is sought, such as a chattel mortgagee, may maintain an action for replevin therefor. Where the
mortgage authorizes the mortgagee to take possession of the property on default, he may maintain an
action to recover possession of the mortgaged chattels from the mortgagor or from any person in whose
hands he may find them."[23]
In effect then, the mortgagee, upon the mortgagor's default, is constituted an attorney-in-fact of
the mortgagor enabling such mortgagee to act for and in behalf of the owner. Accordingly, that
the defendant is not privy to the chattel mortgage should be inconsequential. By the fact that the
object of replevin is traced to his possession, one properly can be a defendant in an action for
replevin. It is here assumed that the plaintiff's right to possess the thing is not or cannot be
disputed.
In case the right of possession on the part of the plaintiff, or his authority to claim such
possession or that of his principal, is put to great doubt (a contending party might contest the
legal bases for plaintiff's cause of action or an adverse and independent claim of ownership or
right of possession is raised by that party), it could become essential to have other persons
involved and accordingly impleaded for a complete determination and resolution of the
controversy. For instance, in Servicewide Specialists, Inc., vs. Court of Appeals, et al., G.R. No.
103301, 08 December 1995, this Court ruled:
"While, in its present petition for review on certiorari, Servicewide has raised a number of points, the
crucial issue still remains, however, to be whether or not an action filed by the mortgagee for replevin to
effect a foreclosure of the property covered by the chattel mortgage would require that the mortgagor be
so impleaded as an indispensable party thereto.
"Rule 60 of the Rules of Court allows a plaintiff, in an action for the recovery of possession of personal
property, to apply for a writ of replevin if it can be shown that he is `the owner of the property claimed x x
x or is entitled to the possession thereof. The plaintiff need not be the owner so long as he is able to
specify his right to the possession of the property and his legal basis therefor. The question then, insofar as
the matter finds relation to the instant case, is whether or not the plaintiff (herein petitioner) who has
predicated his right on being the mortgagee of a chattel mortgage should implead the mortgagor in his
complaint that seeks to recover possession of the encumbered property in order to effect its foreclosure.
"The answer has to be in the affirmative. In a suit for replevin, a clear right of possession must be
established. A foreclosure under a chattel mortgage may properly be commenced only once there is
default on the part of the mortgagor of his obligation secured by the mortgage. The replevin in the instant
case has been sought to pave the way for the foreclosure of the object covered by the chattel
mortgage. The conditions essential for that foreclosure would be to show, firstly, the existence of the
chattel mortgage and, secondly, the default of the mortgagor. These requirements must be established
since the validity of the plaintiff's exercise of the right of foreclosure are inevitably dependent thereon. It
would thus seem, considering particularly an adverse and independent claim of ownership by private
respondent, that the lower court acted improvidently when it granted the dismissal of the complaint
against Dollente, albeit on petitioner's (then plaintiff) plea, on the ground that the non-service of summons
upon Ernesto Dollente (would) only delay the determination of the merits of the case, to the prejudice of
the parties' In Imson v. Court of Appeals, we have explained:

x x x. An indispensable party is one whose interest will be affected by the court's action in the litigation,
and without whom no final determination of the case can be had. The party's interest in the subject matter
of the suit and in the relief sought are so inextricably intertwined with the other parties that his legal
presence as a party to the proceeding is an absolute necessity. In his absence there cannot be a resolution
of the dispute of the parties before the court which is effective, complete, or equitable.

`Conversely, a party is not indispensable to the suit if his interest in the controversy or subject matter is
distinct and divisible from the interest of the other parties and will not necessarily be prejudiced by a
judgment which does complete justice to the parties in court. He is not indispensable if his presence would
merely permit complete relief between him and those already parties to the action or will simply avoid
multiple litigation.'

"Without the presence of indispensable parties to a suit or proceeding, a judgment of a court cannot attain
real finality." (Footnotes omitted.)

A chattel mortgagee, unlike a pledgee, need not be in, nor entitled to, the possession of
the property unless and until the mortgagor defaults and the mortgagee thereupon seeks to
foreclose thereon. Since the mortgagee's right of possession is conditioned upon the actual fact
of default which itself may be controverted, the inclusion of other parties, like the debtor or the
mortgagor himself, may be required in order to allow a full and conclusive determination of the
case. When the mortgagee seeks a replevin in order to effect the eventual foreclosure of the
mortgage, it is not only the existence of, but also the mortgagor's default on, the chattel
mortgage that, among other things, can properly uphold the right to replevy the property. The
burden to establish a valid justification for that action lies with the plaintiff. An adverse
possessor, who is not the mortgagor, cannot just be deprived of his possession, let alone be
bound by the terms of the chattel mortgage contract, simply because the mortgagee brings up
an action for replevin.

The appellate court, accordingly, acted well in arriving at its now questioned judgment.

WHEREFORE, the decision of the Court of Appeals is AFFIRMED. No costs.

SO ORDERED.
 SECOND DIVISION perjuicios causados a los mismos como fue estimado por el Juzgado. Se presenta
ahora ante esta Corte, mediante certiorari, apelacion de esta decision del Tribunal
[G.R. No. 47033. April 25, 1941.] de Apelaciones.

JOSE DINGCONG, recurrente y apelante, contra HALIM KANAAN, NASRI
KANAAN, y MICHAEL KANAAN, dedicados al comercio bajo la razon social
de "American Bazar," recurridos y apelados.
Sres. Ezpeleta y Salvosa en representacion del recurrente.
SYLLABUS
1. ARTICULO 1910 DEL CODIGO CIVIL; DAÑOS Y PERJUICIOS; FALTA DE LA
DILIGENCIA DE UN BUEN PADRE DE FAMILIA. — Siendo J. D. coarrendatario y
manager del hotel, con completa posesion de los altos de la casa, debe responder
por los daños causados por las cosas que se arrojaron o cayeron de la misma
(articulo 1910 del Codigo Civil). F.E. Era huesped del hotel y fue el que
directamente, por su descuido, al dejar abierto el grifo, permitio que el agua de la
tuberia descorriera por el suelo y se filtrara hacia los bajos, mojando los articulos y
mercancias de los demandantes. J.D., por otra parte, no practico la diligencia de un
buen padre de familia para prevenir estos daños, no obstante de que sabia que
podian causarse por estar entonces en reparacion las tuberias, pues, debiendo
presumir que E podia usar el grifo no le proveyo de algun recipiente con desagüe, y
si solo puso debajo del mismo una palangana que, al ilenarse, hizo que el agua se
esparciera por el suelo.
Siendo Jose Dingcong coarrendatario y manager del hotel, con completa posesion
de los altos de la casa, debe responder por los daños causados por las cosas que se
arrojaron o cayeron de la misma (articulo 1910 del Codigo Civil). Francisco
Echevarria era huesped del hotel y fue el que directamente, por su descuido, al
dejar abierto el grifo, permitio, que el agua de la tuberia descorriera por el suelo y
se filtrara hacia los bajos, mojando los articulos y mercancias de los demandantes.
Jose Dingcong, por otra parte, no practico la diligencia de un buen padre de familia
para prevenir estos daños, no obstante de que sabia que podian causarse por estar
entonces en reparacion las tuberias, pues, debiendo presumir que Echavarria podia
usar el grifo no le proveyo de algun recipiente con desagüe, y si solo puso debajo
del mismo una palangana que, al Ilenarse, hizo que el agua se esparciera por el
suelo.
Se confirma la decision apelada, con las costas al apelante.

DECISION

AVANCEÑA, Pres. p:chanrob1es virtual 1aw library

Segun la decision del Tribunal de Apelaciones, los hermanos Loreto Dingcong y Jose
Dingcong son soarrendatarios de los altos de la casa de Emilia Saenz situada en la
Calle Jose Ma. Basa de la Ciudad de Iloilo, donde establecieron el Central Hotel,
siendo la primera la dueña y el ultimo su manager. El demandado Francisco
Echevarria ocupo, mediante pago de P30 al mes, el cuatro No. 10 de dicho hotel.
Los demandantes ocupaban, a su vez los bajos de este hotel donde tenian
establecido su "American Bazar" dedicado a la compra y venta de articulos y
mercancias. Hacia las once de la noche del 19 de septiembre de 1933, Echevarria,
al retirarse a la cama, dejo abierto descuidadamente el grifo que daba sobre una
palangana ordinaria sin desague. Como las tuberias del hotel en aquel tiempo
estaban en reparacion, cuando a la media noche el agua descorrio por las tuberias,
se esparcio por el suelo, traspasandolo y mojando los articulos y mercancias
almacenadas en los bajos en el establecimiento "American Bazar", causando una
perdida, que el Juzgado de Primera Instancia estimo en P1,089.61.

Se presento esta accion por Halim Kanaan, Nasri Kanaan y Michel Kanaan en
nombre del "American Bazar" contra Loreta Dingcong, Jose Dingcong y Francisco
Echeverria por daños y perjuicios causados a los demandantes. El Juzgado
sobreseyo la causa en cuanto a Loreto Dingcong por haber fallecido, y condeno a
Francisco Echevarria, absolviendo a Jose Dingcong. Los demandantes apelaron de
esta decision en cuanto absuelve a Jose Dingcong. El Tribunal Apelaciones,
revocando la decision del Juzgado de Primera Instancia, declaro a Jose Dingcong
responsable y le condeno a pagar a los demandantes el importe de los daños y