his car to the left but it was too late and his car smashed into
the dump truck. As a result of the collision, Dionisio suffered
G.R. No. L-65295 March 10, 1987
PHOENIX CONSTRUCTION, INC. and ARMANDO U.
CARBONEL, petitioners,
vs.
THE INTERMEDIATE APPELLATE COURT and
LEONARDO DIONISIO, respondents.
FELICIANO, J:
In the early morning of 15 November 1975 — at about 1:30
a.m. — private respondent Leonardo Dionisio was on his
way home — he lived in 1214-B Zamora Street, Bangkal,
Makati — from a cocktails-and-dinner meeting with his boss,
the general manager of a marketing corporation. During the
cocktails phase of the evening, Dionisio had taken "a shot or
two" of liquor. Dionisio was driving his Volkswagen car and
had just crossed the intersection of General Lacuna and
General Santos Streets at Bangkal, Makati, not far from his
home, and was proceeding down General Lacuna Street,
when his car headlights (in his allegation) suddenly failed.
He switched his headlights on "bright" and thereupon he saw
a Ford dump truck looming some 2-1/2 meters away from his
car. The dump truck, owned by and registered in the name
of petitioner Phoenix Construction Inc. ("Phoenix"), was
parked on the right hand side of General Lacuna Street (i.e.,
on the right hand side of a person facing in the same
direction toward which Dionisio's car was proceeding), facing
the oncoming traffic. The dump truck was parked askew (not
parallel to the street curb) in such a manner as to stick out
onto the street, partly blocking the way of oncoming traffic.
There were no lights nor any so-called "early warning"
reflector devices set anywhere near the dump truck, front or
rear. The dump truck had earlier that evening been driven
home by petitioner Armando U. Carbonel, its regular driver,
with the permission of his employer Phoenix, in view of work
scheduled to be carried out early the following morning,
Dionisio claimed that he tried to avoid a collision by swerving
some physical injuries including some permanent facial
scars, a "nervous breakdown" and loss of two gold bridge
dentures.
Dionisio commenced an action for damages in the Court of
First Instance of Pampanga basically claiming that the legal
and proximate cause of his injuries was the negligent
manner in which Carbonel had parked the dump truck
entrusted to him by his employer Phoenix. Phoenix and
Carbonel, on the other hand, countered that the proximate
cause of Dionisio's injuries was his own recklessness in
driving fast at the time of the accident, while under the
influence of liquor, without his headlights on and without a
curfew pass. Phoenix also sought to establish that it had
exercised due rare in the selection and supervision of the
dump truck driver.
The trial court rendered judgment in favor of Dionisio and
against Phoenix and Carbonel and ordered the latter:
(1) To pay plaintiff jointly and severally the sum
of P 15,000.00 for hospital bills and the
replacement of the lost dentures of plaintiff;
(2) To pay plaintiff jointly and severally the sum
of P 1,50,000.-00 as loss of expected income
for plaintiff brought about the accident in
controversy and which is the result of the
negligence of the defendants;
(3) To pay the plaintiff jointly and severally the
sum of P 10,000. as moral damages for the
unexpected and sudden withdrawal of plaintiff
from his lifetime career as a marketing man;
mental anguish, wounded feeling, serious
anxiety, social humiliation, besmirched
reputation, feeling of economic insecurity, and
the untold sorrows and frustration in life
experienced by plaintiff and his family since the
accident in controversy up to the present time;
 (4) To pay plaintiff jointly and severally the sum
of P 10,000.00 as damages for the wanton
disregard of defendants to settle amicably this
case with the plaintiff before the filing of this
case in court for a smaller amount.
(5) To pay the plaintiff jointly and severally the
sum of P 4,500.00 due as and for attorney's
fees; and
(6) The cost of suit. (Emphasis supplied)
Phoenix and Carbonel appealed to the Intermediate
Appellate Court. That court in CA-G.R. No. 65476 affirmed
the decision of the trial court but modified the award of
damages to the following extent:
1. The award of P15,000.00 as
compensatory damages was
reduced to P6,460.71, the latter
being the only amount that the
appellate court found the plaintiff
to have proved as actually
sustained by him;
2. The award of P150,000.00 as
loss of expected income was
reduced to P100,000.00,
basically because Dionisio had
voluntarily resigned his job such
that, in the opinion of the
appellate court, his loss of
income "was not solely
attributable to the accident in
question;" and
3. The award of P100,000.00 as
moral damages was held by the
appellate court as excessive and
unconscionable and hence
reduced to P50,000.00.
The award of P10,000.00 as
exemplary damages and
P4,500.00 as attorney's fees and
costs remained untouched.
This decision of the Intermediate Appellate Court is now
before us on a petition for review.
Both the trial court and the appellate court had made fairly
explicit findings of fact relating to the manner in which the
dump truck was parked along General Lacuna Street on the
basis of which both courts drew the inference that there was
negligence on the part of Carbonel, the dump truck driver,
and that this negligence was the proximate cause of the
accident and Dionisio's injuries. We note, however, that both
courts failed to pass upon the defense raised by Carbonel
and Phoenix that the true legal and proximate cause of the
accident was not the way in which the dump truck had been
parked but rather the reckless way in which Dionisio had
driven his car that night when he smashed into the dump
truck. The Intermediate Appellate Court in its questioned
decision casually conceded that Dionisio was "in some way,
negligent" but apparently failed to see the relevance of
Dionisio's negligence and made no further mention of it. We
have examined the record both before the trial court and the
Intermediate Appellate Court and we find that both parties
had placed into the record sufficient evidence on the basis of
which the trial court and the appellate court could have and
should have made findings of fact relating to the alleged
reckless manner in which Dionisio drove his car that night.
The petitioners Phoenix and Carbonel contend that if there
was negligence in the manner in which the dump truck was
parked, that negligence was merely a "passive and static
condition" and that private respondent Dionisio's
recklessness constituted an intervening, efficient cause
determinative of the accident and the injuries he sustained.
The need to administer substantial justice as between the
parties in this case, without having to remand it back to the
trial court after eleven years, compels us to address directly
the contention put forward by the petitioners and to examine
for ourselves the record pertaining to Dionisio's alleged
negligence which must bear upon the liability, or extent of
liability, of Phoenix and Carbonel.
There are four factual issues that need to be looked into: (a)
whether or not private respondent Dionisio had a curfew
pass valid and effective for that eventful night; (b) whether
Dionisio was driving fast or speeding just before the collision
with the dump truck; (c) whether Dionisio had purposely
turned off his car's headlights before contact with the dump
truck or whether those headlights accidentally malfunctioned
moments before the collision; and (d) whether Dionisio was
intoxicated at the time of the accident.
As to the first issue relating to the curfew pass, it is clear that
no curfew pass was found on the person of Dionisio
immediately after the accident nor was any found in his car.
Phoenix's evidence here consisted of the testimony of
Patrolman Cuyno who had taken Dionisio, unconscious, to
the Makati Medical Center for emergency treatment
immediately after the accident. At the Makati Medical Center,
a nurse took off Dionisio's clothes and examined them along
with the contents of pockets together with Patrolman Cuyno.
1 Private respondent Dionisio was not able to produce any
curfew pass during the trial. Instead, he offered the
explanation that his family may have misplaced his curfew
pass. He also offered a certification (dated two years after
the accident) issued by one Major Benjamin N. Libarnes of
the Zone Integrated Police Intelligence Unit of Camp Olivas,
San Fernando, Pampanga, which was said to have authority
to issue curfew passes for Pampanga and Metro Manila.
This certification was to the effect that private respondent
Dionisio had a valid curfew pass. This certification did not,
however, specify any pass serial number or date or period of
effectivity of the supposed curfew pass. We find that private
respondent Dionisio was unable to prove possession of a
valid curfew pass during the night of the accident and that
the preponderance of evidence shows that he did not have
such a pass during that night. The relevance of possession
or non-possession of a curfew pass that night lies in the light
it tends to shed on the other related issues: whether Dionisio
was speeding home and whether he had indeed purposely
put out his headlights before the accident, in order to avoid
detection and possibly arrest by the police in the nearby
police station for travelling after the onset of curfew without a
valid curfew pass.
On the second issue — whether or not Dionisio was
speeding home that night — both the trial court and the
appellate court were completely silent.
The defendants in the trial court introduced the testimony of
Patrolman Cuyno who was at the scene of the accident
almost immediately after it occurred, the police station where
he was based being barely 200 meters away. Patrolman
Cuyno testified that people who had gathered at the scene of
the accident told him that Dionisio's car was "moving fast"
and did not have its headlights on. 2 Dionisio, on the other
hand, claimed that he was travelling at a moderate speed at
30 kilometers per hour and had just crossed the intersection
of General Santos and General Lacuna Streets and had
started to accelerate when his headlights failed just before
the collision took place. 3
Private respondent Dionisio asserts that Patrolman Cuyno's
testimony was hearsay and did not fag within any of the
recognized exceptions to the hearsay rule since the facts he
testified to were not acquired by him through official
information and had not been given by the informants
pursuant to any duty to do so. Private respondent's objection
fails to take account of the fact that the testimony of
Patrolman Cuyno is admissible not under the official records
exception to the hearsay rule 4 but rather as part of the res
gestae. 5 Testimonial evidence under this exception to the
hearsay rule consists of excited utterances made on the
occasion of an occurrence or event sufficiently startling in
nature so as to render inoperative the normal reflective
thought processes of the observer and hence made as a
spontaneous reaction to the occurrence or event, and not
the result of reflective thought. 6
We think that an automobile speeding down a street and
suddenly smashing into a stationary object in the dead of
night is a sufficiently startling event as to evoke
spontaneous, rather than reflective, reactions from observers
who happened to be around at that time. The testimony of
Patrolman Cuyno was therefore admissible as part of the res
gestae and should have been considered by the trial court.
Clearly, substantial weight should have been ascribed to
such testimony, even though it did not, as it could not, have
purported to describe quantitatively the precise velocity at
winch Dionisio was travelling just before impact with the
Phoenix dump truck.
A third related issue is whether Dionisio purposely turned off
his headlights, or whether his headlights accidentally
malfunctioned, just moments before the accident. The
Intermediate Appellate Court expressly found that the
headlights of Dionisio's car went off as he crossed the
intersection but was non-committal as to why they did so. It
is the petitioners' contention that Dionisio purposely shut off
his headlights even before he reached the intersection so as
not to be detected by the police in the police precinct which
he (being a resident in the area) knew was not far away from
the intersection. We believe that the petitioners' theory is a
more credible explanation than that offered by private
respondent Dionisio — i.e., that he had his headlights on but
that, at the crucial moment, these had in some mysterious if
convenient way malfunctioned and gone off, although he
succeeded in switching his lights on again at "bright" split
seconds before contact with the dump truck.
A fourth and final issue relates to whether Dionisio was
intoxicated at the time of the accident. The evidence here
consisted of the testimony of Patrolman Cuyno to the effect
that private respondent Dionisio smelled of liquor at the time
he was taken from his smashed car and brought to the
Makati Medical Center in an unconscious condition. 7 This
testimony has to be taken in conjunction with the admission
of Dionisio that he had taken "a shot or two" of liquor before
dinner with his boss that night. We do not believe that this
evidence is sufficient to show that Dionisio was so heavily
under the influence of liquor as to constitute his driving a
motor vehicle per se an act of reckless imprudence. 8 There
simply is not enough evidence to show how much liquor he
had in fact taken and the effects of that upon his physical
faculties or upon his judgment or mental alertness. We are
also aware that "one shot or two" of hard liquor may affect
different people differently.
The conclusion we draw from the factual circumstances
outlined above is that private respondent Dionisio was
negligent the night of the accident. He was hurrying home
that night and driving faster than he should have been.
Worse, he extinguished his headlights at or near the
intersection of General Lacuna and General Santos Streets
and thus did not see the dump truck that was parked askew
and sticking out onto the road lane.
Nonetheless, we agree with the Court of First Instance and
the Intermediate Appellate Court that the legal and
proximate cause of the accident and of Dionisio's injuries
was the wrongful — or negligent manner in which the dump
truck was parked in other words, the negligence of petitioner
Carbonel. That there was a reasonable relationship between
petitioner Carbonel's negligence on the one hand and the
accident and respondent's injuries on the other hand, is quite
clear. Put in a slightly different manner, the collision of
Dionisio's car with the dump truck was a natural and
foreseeable consequence of the truck driver's negligence.
The petitioners, however, urge that the truck driver's
negligence was merely a "passive and static condition" and
that private respondent Dionisio's negligence was an
"efficient intervening cause and that consequently Dionisio's
negligence must be regarded as the legal and proximate
cause of the accident rather than the earlier negligence of
Carbonel. We note that the petitioners' arguments are drawn
from a reading of some of the older cases in various
jurisdictions in the United States but we are unable to
persuade ourselves that these arguments have any validity
for our jurisdiction. We note, firstly, that even in the United
States, the distinctions between "cause" and "condition"
which the 'petitioners would have us adopt have already
been "almost entirely discredited." Professors and Keeton
make this quite clear:
Cause and condition. Many courts have sought
to distinguish between the active "cause" of the
harm and the existing "conditions" upon which
that cause operated. If the defendant has
created only a passive static condition which
made the damage possible, the defendant is
said not to be liable. But so far as the fact of
causation is concerned, in the sense of
necessary antecedents which have played an
important part in producing the result it is quite
impossible to distinguish between active forces
and passive situations, particularly since, as is
invariably the case, the latter are the result of
other active forces which have gone before.
The defendant who spills gasoline about the
premises creates a "condition," but the act may
be culpable because of the danger of fire.
When a spark ignites the gasoline, the
condition has done quite as much to bring
about the fire as the spark; and since that is
the very risk which the defendant has created,
the defendant will not escape responsibility.
Even the lapse of a considerable time during
which the "condition" remains static will not
necessarily affect liability; one who digs a
trench in the highway may still be liable to
another who fans into it a month afterward.
"Cause" and "condition" still find occasional
mention in the decisions; but the distinction is
now almost entirely discredited. So far as it has
any validity at all, it must refer to the type of
case where the forces set in operation by the
defendant have come to rest in a position of
apparent safety, and some new force
intervenes. But even in such cases, it is not the
distinction between "cause" and "condition"
which is important but the nature of the risk
and the character of the intervening cause. 9
We believe, secondly, that the truck driver's negligence far
from being a "passive and static condition" was rather an
indispensable and efficient cause. The collision between the
dump truck and the private respondent's car would in an
probability not have occurred had the dump truck not been
parked askew without any warning lights or reflector devices.
The improper parking of the dump truck created an
unreasonable risk of injury for anyone driving down General
Lacuna Street and for having so created this risk, the truck
driver must be held responsible. In our view, Dionisio's
negligence, although later in point of time than the truck
driver's negligence and therefore closer to the accident, was
not an efficient intervening or independent cause. What the
Petitioners describe as an "intervening cause" was no more
than a foreseeable consequent manner which the truck
driver had parked the dump truck. In other words, the
petitioner truck driver owed a duty to private respondent
Dionisio and others similarly situated not to impose upon
them the very risk the truck driver had created. Dionisio's
negligence was not of an independent and overpowering
nature as to cut, as it were, the chain of causation in fact
between the improper parking of the dump truck and the
accident, nor to sever the juris vinculum of liability. It is
helpful to quote once more from Professor and Keeton:
Foreseeable Intervening Causes. If the
intervening cause is one which in ordinary
human experience is reasonably to be
anticipated or one which the defendant has
reason to anticipate under the particular
circumstances, the defendant may be
negligence among other reasons, because of
failure to guard against it; or the defendant may
be negligent only for that reason. Thus one
who sets a fire may be required to foresee that
an ordinary, usual and customary wind arising
later wig spread it beyond the defendant's own
property, and therefore to take precautions to
prevent that event. The person who leaves the
combustible or explosive material exposed in a
public place may foresee the risk of fire from
some independent source. ... In all of these
cases there is an intervening cause combining
with the defendant's conduct to produce the
result and in each case the defendant's
negligence consists in failure to protect the
plaintiff against that very risk.
Obviously the defendant cannot be relieved
from liability by the fact that the risk or a
substantial and important part of the risk, to
which the defendant has subjected the plaintiff
has indeed come to pass. Foreseeable
intervening forces are within the scope original
risk, and hence of the defendant's negligence.
The courts are quite generally agreed that
intervening causes which fall fairly in this
category will not supersede the defendant's
responsibility.
Thus it has been held that a defendant will be
required to anticipate the usual weather of the
vicinity, including all ordinary forces of nature
such as usual wind or rain, or snow or frost or
fog or even lightning; that one who leaves an
obstruction on the road or a railroad track
should foresee that a vehicle or a train will run
into it; ...
The risk created by the defendant may include
the intervention of the foreseeable negligence
of others. ... [The standard of reasonable
conduct may require the defendant to protect
the plaintiff against 'that occasional negligence
which is one of the ordinary incidents of human
life, and therefore to be anticipated.' Thus, a
defendant who blocks the sidewalk and forces
the plaintiff to walk in a street where the
plaintiff will be exposed to the risks of heavy
traffic becomes liable when the plaintiff is run
down by a car, even though the car is
negligently driven; and one who parks an
automobile on the highway without lights at
night is not relieved of responsibility when
another negligently drives into it. --- 10
We hold that private respondent Dionisio's negligence was
"only contributory," that the "immediate and proximate
cause" of the injury remained the truck driver's "lack of due
care" and that consequently respondent Dionisio may
recover damages though such damages are subject to
mitigation by the courts (Article 2179, Civil Code of the
Philippines).
Petitioners also ask us to apply what they refer to as the "last
clear chance" doctrine. The theory here of petitioners is that
while the petitioner truck driver was negligent, private
respondent Dionisio had the "last clear chance" of avoiding
the accident and hence his injuries, and that Dionisio having
failed to take that "last clear chance" must bear his own
injuries alone. The last clear chance doctrine of the common
law was imported into our jurisdiction by Picart vs. Smith11
but it is a matter for debate whether, or to what extent, it has
found its way into the Civil Code of the Philippines. The
historical function of that doctrine in the common law was to
mitigate the harshness of another common law doctrine or
rule that of contributory negligence. 12 The common law rule
of contributory negligence prevented any recovery at all by a
plaintiff who was also negligent, even if the plaintiff's
negligence was relatively minor as compared with the
wrongful act or omission of the defendant. 13 The common
law notion of last clear chance permitted courts to grant
recovery to a plaintiff who had also been negligent provided
that the defendant had the last clear chance to avoid the
casualty and failed to do so. 14 Accordingly, it is difficult to
see what role, if any, the common law last clear chance
doctrine has to play in a jurisdiction where the common law
concept of contributory negligence as an absolute bar to
recovery by the plaintiff, has itself been rejected, as it has
been in Article 2179 of the Civil Code of the Philippines. 15
Is there perhaps a general concept of "last clear chance"
that may be extracted from its common law matrix and
utilized as a general rule in negligence cases in a civil law
jurisdiction like ours? We do not believe so. Under Article
2179, the task of a court, in technical terms, is to determine
whose negligence — the plaintiff's or the defendant's — was
the legal or proximate cause of the injury. That task is not
simply or even primarily an exercise in chronology or
physics, as the petitioners seem to imply by the use of terms
like "last" or "intervening" or "immediate." The relative
location in the continuum of time of the plaintiff's and the
defendant's negligent acts or omissions, is only one of the
relevant factors that may be taken into account. Of more
fundamental importance are the nature of the negligent act
or omission of each party and the character and gravity of
the risks created by such act or omission for the rest of the
community. The petitioners urge that the truck driver (and
therefore his employer) should be absolved from
responsibility for his own prior negligence because the
unfortunate plaintiff failed to act with that increased diligence
which had become necessary to avoid the peril precisely
created by the truck driver's own wrongful act or omission.
To accept this proposition is to come too close to wiping out
the fundamental principle of law that a man must respond for
the forseeable consequences of his own negligent act or
omission. Our law on quasi-delicts seeks to reduce the risks
and burdens of living in society and to allocate them among
the members of society. To accept the petitioners' pro-
position must tend to weaken the very bonds of society.
Petitioner Carbonel's proven negligence creates a
presumption of negligence on the part of his employer
Phoenix 16 in supervising its employees properly and
adequately. The respondent appellate court in effect found,
correctly in our opinion, that Phoenix was not able to
overcome this presumption of negligence. The circumstance
that Phoenix had allowed its truck driver to bring the dump
truck to his home whenever there was work to be done early
the following morning, when coupled with the failure to show
any effort on the part of Phoenix to supervise the manner in
which the dump truck is parked when away from company
premises, is an affirmative showing of culpa in vigilando on
the part of Phoenix.
Turning to the award of damages and taking into account the
comparative negligence of private respondent Dionisio on
one hand and petitioners Carbonel and Phoenix upon the
other hand, 17 we believe that the demands of substantial
justice are satisfied by allocating most of the damages on a
20-80 ratio. Thus, 20% of the damages awarded by the
respondent appellate court, except the award of P10,000.00
as exemplary damages and P4,500.00 as attorney's fees
and costs, shall be borne by private respondent Dionisio;
only the balance of 80% needs to be paid by petitioners
Carbonel and Phoenix who shall be solidarity liable therefor
to the former. The award of exemplary damages and
attorney's fees and costs shall be borne exclusively by the
petitioners. Phoenix is of course entitled to reimbursement
from Carbonel. 18 We see no sufficient reason for disturbing
the reduced award of damages made by the respondent
appellate court.
WHEREFORE, the decision of the respondent appellate
court is modified by reducing the aggregate amount of
compensatory damages, loss of expected income and moral
damages private respondent Dionisio is entitled to by 20% of
such amount. Costs against the petitioners.
SO ORDERED.
 G.R. No. L-40570, January 30, 1976 ]
TEODORO C. UMALI, PETITIONER, VS. HON. ANGEL
BACANI, IN HIS CAPACITY AS PRESIDING JUDGE OF
BRANCH IX OF THE COURT OF FIRST INSTANCE OF
PANGASINAN AND FIDEL H. SAYNES, RESPONDENTS.
DECISION
ESGUERRA, J.:
Petition for certiorari to review the decision of the Court of
First Instance of Pangasinan, Branch IX, in Civil Case No. U-
2412, entitled, "Fidel H. Saynes, plaintiff-appellee versus
Teodoro C. Umali, defendant-appellant", which found the
death by electrocution of Manuel Saynes, a boy of 3 years
and 8 months, as "due to the fault and negligence of the
defendant (Umali) as owner and manager of the Alcala
Electric Plant", although the liability of defendant is mitigated
by contributory negligence of the parents of the boy "in not
providing for the proper and adequate supervision and
control over their son". The dispositive part of the decision
reads as follows:
"Wherefore, the Court hereby renders judgment in favor of
the plaintiff by ordering the defendant to pay the plaintiff the
sum of Five Thousand Pesos (P5,000.00) for the death of
his son, Manuel Saynes; the sum of One Thousand Two
Hundred Pesos (P1,200.00) for actual expenses for and in
connection with the burial of said deceased child, and the
further sum of Three Thousand Pesos (P3,000.00) for moral
damages and Five Hundred (P500.00) Pesos as reasonable
attorney's fee, or a total of Nine Thousand Seven Hundred
(P9,700.00) Pesos, and to pay the costs of this suit. It Is So
Ordered."
Undisputed facts appearing of record are:
"On May 14, 1972, a storm with strong rain hit the
Municipality of Alcala, Pangasinan, which started from 2:00
o'clock in the afternoon and lasted up to about midnight of
the same day. During the storm, the banana plants standing
on an elevated ground along the barrio road in San Pedro Ili
of said municipality and near the transmission line of the
Alcala Electric Plant were blown down and fell on the electric
wire. As a result, the live electric wire was cut, one end of
which was left hanging on the electric post and the other fell
to the ground under the fallen banana plants.
"On the following morning, at about 9:00 o'clock barrio
captain Luciano Bueno of San Pedro Ili who was passing by
saw the broken electric wire and so he warned the people in
the place not to go near the wire for they might get hurt. He
also saw Cipriano Baldomero, a laborer of the Alcala Electric
Plant near the place and notified him right then and there of
the broken line and asked him to fix it, but the latter told the
barrio captain that he could not do it but that he was going to
look for the lineman to fix it.
"Sometime after the barrio captain and Cipriano Baldomero
had left the place, a small boy of 3 years and 8 months old
by the name of Manuel P. Saynes, whose house is just on
the opposite side of the road went to the place where the
broken line wire was and got contact with it. The boy was
electrocuted and he subsequently died. It was only after the
electrocution of Manuel Saynes that the broken line was
fixed at about 10:00 o'clock on the same morning by the
lineman of the electric plant."
Petitioner claims that he could not be liable under the
concept of quasi-delict or tort as owner and manager of the
Alcala Electric Plant because the proximate cause of the
boy's death by electrocution could not be due to any
negligence on his part, but rather to a fortuitous event – the
storm that caused the banana plants to fall and cut the
electric line – pointing out the absence of negligence on the
part of his employee Cipriano Baldomero who tried to have
the line repaired and the presence of negligence of the
parents of the child in allowing him to leave his house during
that time.
A careful examination of the record convinces Us that a
series of negligence on the part of defendant's employees in
the Alcala Electric Plant resulted in the death of the victim by
electrocution. First, by the very evidence of the defendant,
there were big and tall banana plants at the place of the
incident standing on an elevated ground which were about
30 feet high and which were higher than the electric post
supporting the electric line, and yet the employees of the
defendant who, with ordinary foresight, could have easily
seen that even in case of moderate winds the electric line
would be endangered by banana plants being blown down,
did not even take the necessary precaution to eliminate the
source of danger to the electric line. Second, even after the
employees of the Alcala Electric Plant were already aware of
the possible damage the storm of May 14, 1972, could have
caused their electric lines, thus becoming a possible threat
to life and property, they did not cut off from the plant the
flow of electricity along the lines, an act they could have
easily done pending inspection of the wires to see if they had
been cut. Third, employee Cipriano Baldomero was
negligent on the morning of the incident because even if he
was already made aware of the live cut wire, he did not have
the foresight to realize that the same posed a danger to life
and property, and that he should have taken the necessary
precaution to prevent anybody from approaching the live
wire; instead Baldomero left the premises because what was
foremost in his mind was the repair of the line, obviously
forgetting that if left unattended to it could endanger life and
property.
On defendant's argument that the proximate cause of the
victim's death could be attributed to the parents' negligence
in allowing a child of tender age to go out of the house alone,
We could readily see that because of the aforementioned
series of negligence on the part of defendant's employees
resulting in a live wire lying on the premises without any
visible warning of its lethal character, anybody, even a
responsible grown up or not necessarily an innocent child,
could have met the same fate that befell the victim. It may be
true, as the lower Court found out, that the contributory
negligence of the victim's parents in not properly taking care
of the child, which enabled him to leave the house alone on
the morning of the incident and go to a nearby place (cut
wire was very near the house where victim was living) where
the fatal fallen wire electrocuted him, might mitigate
respondent's liability, but We cannot agree with petitioner's
theory that the parents' negligence constituted the proximate
cause of the victim's death because the real proximate
cause was the fallen live wire which posed a threat to life
and property on that morning due to the series of negligence
adverted to above committed by defendants' employees and
which could have killed any other person who might by
accident get into contact with it. Stated otherwise, even if the
child was allowed to leave the house unattended due to the
parents' negligence, he would not have died that morning
where it not for the cut live wire he accidentally touched.
Art. 2179 of the Civil Code provides that if the negligence of
the plaintiff (parents of the victim in this case) was only
contributory, the immediate and proximate cause of the
injury being the defendants' lack of due care, the plaintiff
may recover damages, but the courts shall mitigate the
damages to be awarded. This law may be availed of by the
petitioner but does not exempt him from liability.
Petitioner's liability for injury caused by his employees'
negligence is well defined in par. 4, of Article 2180 of the
Civil Code, which states:
"The owner and manager of the establishment or enterprise
are likewise responsible for damages caused by their
employees in the service of the branches in which the latter
are employed or on the occasion of their functions."
The negligence of the employee is presumed to be the
negligence of the employer because the employer is
supposed to exercise supervision over the work of the
employees. This liability of the employer is primary and
direct (Standard Vacuum Oil Co. vs. Tan and Court of
Appeals, 107 Phil. 109). In fact the proper defense for the
employer to raise so that he may escape liability is to prove
that he exercised the diligence of the good father of the
family to prevent damage not only in the selection of his
employees but also in adequately supervising them over
their work. This defense was not adequately proven as found
by the trial Court, and We do not find any sufficient reason to
deviate from its finding.
Notwithstanding diligent efforts, We fail to find any reversible
error committed by the trial Court in this case, either in its
appreciation of the evidence on questions of facts or on the
interpretation and application of laws governing quasi-delicts
and liabilities emanating therefrom. The inevitable
conclusion is that no error amounting to grave abuse of
discretion was committed and the decision must be left
untouched.
Wherefore, the decision of respondent Court dated June 27,
1974 is affirmed.
Cost against petitioner. So ordered.
[ G.R. No. 32611, November 03, 1930 ]
CULION ICE, FISH & ELECTRIC CO., INC., PLAINTIFF
AND APPELLEE, VS. PHILIPPINE MOTORS
CORPORATION, DEFENDANT AND APPELLANT.
DECISION
STREET, J.:
This action was instituted in the Court of First Instance of
Manila by the Culion Ice, Fish & Electric Co., Inc., for the
purpose of recovering from the Philippine Motors
Corporation the sum of P11,350, with interest and costs.
Upon hearing the cause the trial court gave judgment in
favor of the plaintiff to recover of the defendant the sum of
P9,850, with interest at 6 per centum per annum from March
24, 1927, the date of the filing of the complaint, until
satisfaction of the judgment, with costs. From this judgment
the defendant appealed.
The plaintiff and defendant are domestic corporations; and at
the time of the incident with which we are here concerned,
H, D. Cranston was the representative of the plaintiff in the
City of Manila. At the same time the plaintiff was the
registered owner of the motor schooner Gwendoline, which
was used in the fishing trade in the Philippine Islands. In
January, 1925, Cranston decided, if practicable, to have the
engine on the Gwendoline changed from a gasoline
consumer to a crude oil burner, expecting thereby to effect
economy in the cost of running: the boat. He therefore made
known his desire to McLeod & Co., a firm dealing in tractors,
and was told by McKellar, of said company, that he might
make enquiries of the Philippine Motors Corporation, which
had its office on Ongpin Street, in the City of Manila.
Cranston accordingly repaired to the office of the Philippine
Motors Corporation and had a conference with C. E. Quest,
its manager, who agreed to do the job, with the
understanding that payment should be made upon
completion of the work.
The Philippine Motors Corporation was at this time engaged
in business as an automobile agency, but, under its charter,
it had authority to deal in all sorts of machinery engines and
motors, as well as to build, operate, buy and sell the same
and the equipment thereof. Quest, as general manager, had
full charge of the corporation in all its branches.
As a result of the aforesaid interview, Quest, in company
with Cranston, visited the Gwendoline while it lay at anchor
in the Pasig River, and the work of effecting the change in
the engine was begun and conducted under the supervision
of Quest, chiefly by a mechanic whom Quest took with him
to the boat. In this work Quest had the assistance of the
members of the crew of the Gwendoline, who had been
directed by Cranston to place themselves under Quest's
directions.
Upon preliminary inspection of the engine, Quest came to
the conclusion that the principal thing necessary to
accomplish the end in view was to install a new carburetor,
and a Zenith carburetor was chosen as the one most
adapted to the purpose. After this appliance had been
installed, the engine was tried with gasoline as a fuel,
supplied from the tank already in use. The result of this
experiment was satisfactory. The next problem was to
introduce into the carburetor the baser fuel, consisting1 of a
low grade of oil mixed with distillate. For this purpose a
temporary tank to contain the mixture was placed on deck
above and at a short distance from the compartment
covering the engine. This tank was connected with the
carburetor by a piece of tubing, which was apparently not
well fitted at the point where it was connected with the tank.
Owing to this fact the fuel mixture leaked from the tank and
dripped down into the engine compartment. The new fuel
line and that already in use between the gasoline tank and
the carburetor were so fixed that it was possible to change
from the gasoline fuel to the mixed fuel. The purpose of this
arrangement was to enable the operator to start the engine
on gasoline and then, after the engine had been operating
for a few moments, to switch to the new fuel supply.
In the course of the preliminary work upon the carburetor
and its connections, it was observed that the carburetor was
flooding, and that the gasoline, or other fuel, was trickling
freely from the lower part of the carburetor to the floor. This
fact was called to Quest's attention, but he appeared to think
lightly of the matter and said that, when the engine had
gotten to running well, the flooding would disappear.
After preliminary experiments and adjustments had been
made, the boat was taken out into the bay for a trial run at
about 5 p. m., or a little later, on the evening of January 30,
1925. The first part of the course was covered without any
untoward development, other than the fact that the engine
stopped a few times, owing no doubt to the use of an
improper mixture of fuel. In the course of the trial Quest
remained outside of the engine compartment and occupied
himself with making experiments in the matter of mixing the
crude oil with distillate, with a view to ascertaining what
proportion of the two elements would give best results in the
engine.
As the boat was coming in from this run, at about 7.30 p. m.,
and when passing near Cavite, the engine stopped, and
connection again had to be made with the gasoline line to
get a new start. After this had been done the mechanic, or
engineer, switched to the tube connecting with the new
mixture. A moment later a back fire occurred in the cylinder
chamber. This caused a flame to shoot back into the
carburetor, and instantly the carburetor and adjacent parts
were covered with a mass of flames, which the members of
the crew were unable to subdue. They were therefore
compelled, as the lire spread, to take to a boat, and their
escape was safely effected, but the Gwendoline was
reduced to a mere hulk. The salvage from the wreck, when
sold, brought only the sum of P150. The value of the boat,
before the accident occurred, as the court found, was
P10,000.
A study of the testimony leads us to the conclusion that the
loss of this boat was chargeable to the negligence and lack
of skill of Quest. The temporary tank in which the mixture
was prepared was apparently at too great an elevation from
the carburetor, with the result that when the fuel line was
opened, the hydrostatic pressure in the carburetor was
greater than the delicate parts of the carburetor could
sustain. This was no doubt the cause of the flooding of the
carburetor; and the result was that, when the back fire
occurred, the external parts of the carburetor, already
saturated with gasoline, burst into flames, whence the fire
was quickly communicated to the highly inflammable
material near-by. Ordinarily a back fire from an engine would
not be followed by any disaster, but in this case the leak
along the pipe line and the flooding of the carburetor had
created a dangerous situation, which a prudent mechanic,
versed in repairs of this nature, would have taken
precautions to avoid. The back fire may have been due
either to the fact that the spark was too advanced or the fuel
improperly mixed.
In this connection it must be remembered that when a
person holds himself out as being competent to do things
requiring professional skill, he will be held liable for
negligence if he fails to exhibit the care and skill of one
ordinarily skilled in the particular work which he-attempts to
do. The proof shows that Quest had had ample experience
in fixing the engines of automobiles and tractors, but it does
not appear that he was experienced in the doing of similar
work on boats. For this reason, possibly, the dripping of the
mixture from the tank on deck and the flooding of the
carburetor did not convey to his mind an adequate
impression of the danger of fire. But a person skilled in that
particular sort of work would, we think, have been sufficiently
warned from those circumstances to cause him to take
greater and adequate precautions against the danger. In
other words Quest did not use the skill that would have been
exhibited by one ordinarily expert in repairing gasoline
engines on boats. There was here, in our opinion, on the
part of Quest, a blameworthy antecedent inadvertence to
possible harm, and this constitutes negligence. The burning
of the Gwendoline may be said to have resulted from
accident, but this accident was in no sense an unavoidable
accident. It would not have occurred but for Quest's
carelessness or lack of skills The test of liability is not
whether the injury was accidental in a sense, but whether
Quest was free from blame. We therefore see no escape
from the conclusion that this accident is chargeable to lack of
skill or negligence in effecting the changes which Quest
undertook to accomplish; and even supposing that our
theory as to the exact manner in which the accident occurred
might appear to be in some respects incorrect, yet the origin
of the fire is not so inscrutable as to enable us to say that it
was eastis fortuitus.
The trial judge seems to have proceeded on the idea that,
inasmuch as Quest had control of the Gwendoline during the
experimental run, the defendant corporation was in the
position of a bailee and that, as a consequence, the burden
of proof was on the defendant to exculpate itself from
responsibility by proving that the accident was not due to the
fault of Quest. We are unable to accede to this point of view.
Certainly, Quest was not in charge of the navigation of the
boat on this trial run. His employment contemplated the
installation of new parts in the engine only, and it seems
rather strained to hold that the defendant corporation had
thereby become bailee of the boat. As a rule workmen who
make repairs on a ship in its owner's yard, or a mechanic
who repairs a coach without taking it to his shop, are not
bailees, and their rights and liabilities are determined by the
general rules of law, under their contract. The true bailee
acquires possession and what is usually spoken of as
special property in the chattel bailed. As a consequence of
such possession and special property, the bailee is given a
lien for his compensation. These ideas seem to be
incompatible with the situation now under consideration. But
though defendant cannot be held liable on the supposition
that the burden of proof has not been sustained by it in
disproving the negligence of its manager, we are
nevertheless of the opinion that the proof shows by a clear
preponderance that the accident to the Gwendoline and the
damages resulting therefrom are chargeable to the
negligence or lack of skill of Quest.
This action was instituted about two years after the accident
in question had occurred, and after Quest had ceased to be
manager of the defendant corporation and had gone back to
the United States. Upon these facts, the defendant bases
the contention that the action should be considered stale. It
is sufficient reply to say that the action was brought within
the period limited by the statute of limitations and the
situation is not one where the defense of laches can be
properly invoked.
It results that the judgment appealed from, awarding
damages to the plaintiff in the amount of P9,850, with
interest, must be affirmed; and it is so ordered, with costs
against the appellant.
Avanceña, C. J., Malcolm, Villamor, Ostrand,
Romualdez and Villa-Real, JJ., concur.
G.R. No. 125862 April 15, 2004
FRANCISCO CULABA and DEMETRIA CULABA, doing
business under the name and style "Culaba Store",
petitioners,
vs.
COURT OF APPEALS and SAN MIGUEL CORPORATION,
respondents.
DECISION
CALLEJO, SR., J.:
This is a petition for review under Rule 45 of the Revised
Rules of Civil Procedure of the Decision1 of the Court of
Appeals in CA-G.R. CV No. 19836 affirming in toto the
Decision2 of the Regional Trial Court of Makati, Branch 138,
in Civil Case No. 1033 for collection of sum of money, and
the Resolution3 denying the motion for reconsideration of
the said decision.
The Undisputed Facts
The spouses Francisco and Demetria Culaba were the
owners and proprietors of the Culaba Store and were
engaged in the sale and distribution of San Miguel
Corporation’s (SMC) beer products. SMC sold beer products
on credit to the Culaba spouses in the amount of
P28,650.00, as evidenced by Temporary Credit Invoice No.
42943.4 Thereafter, the Culaba spouses made a partial
payment of P3,740.00, leaving an unpaid balance of
P24,910.00. As they failed to pay despite repeated
demands, SMC filed an action for collection of a sum of
money against them before the RTC of Makati, Branch 138.
The defendant-spouses denied any liability, claiming that
they had already paid the plaintiff in full on four separate
occasions. To substantiate this claim, the defendants
presented four (4) Temporary Charge Sales (TCS)
Liquidation Receipts, as follows:
April 19, 1983 Receipt No. for P8,0005
27331
April 22, 1983 Receipt No. for P9,0006
27318
April 27, 1983 Receipt No. for P4,5007
27339
April 30, 1983 Receipt No. for P3,4108
27346
Defendant Francisco Culaba testified that he made the
foregoing payments to an SMC supervisor who came in an
SMC van. He was then showed a list of customers’
accountabilities which included his account. The defendant,
in good faith, then paid to the said supervisor, and he was, in
turn, issued genuine SMC liquidation receipts.
For its part, SMC submitted a publisher’s affidavit9 to prove
that the entire booklet of TCSL Receipts bearing Nos.
27301-27350 were reported lost by it, and that it caused the
publication of the notice of loss in the July 9, 1983 issue of
the Daily Express, as follows:
NOTICE OF LOSS
OUR CUSTOMERS ARE HEREBY INFORMED
THAT TEMPORARY CHARGE SALES LIQUIDATION
RECEIPTS WITH SERIAL NOS. 27301-27350 HAVE
BEEN LOST.
ANY TRANSACTION, THEREFORE, ENTERED
INTO WITH THE USE OF THE ABOVE RECEIPTS
WILL NOT BE HONORED.
SAN MIGUEL CORPORATION
BEER DIVISION
Makati Beer Region10
The Trial Court’s Ruling
After trial on the merits, the trial court rendered judgment in
favor of SMC, and held the Culaba spouses liable on the
balance of its obligation, thus:
Wherefore, judgment is hereby rendered in favor of
the plaintiff, as follows:
1. Ordering defendants to pay the amount of
P24,910.00 plus legal interest of 6% per annum from
April 12, 1983 until the whole amount is fully paid;
2. Ordering defendants to pay 20% of the amount due
to plaintiff as and for attorney’s fees plus costs.
SO ORDERED.11
According to the trial court, it was unusual that defendant
Francisco Culaba forgot the name of the collector to whom
he made the payments and that he did not require the said
collector to print his name on the receipts. The court also
noted that although they were part of a single booklet, the
TCS Liquidation Receipts submitted by the defendants did
not appear to have been issued in their natural sequence.
Furthermore, they were part of the lost booklet receipts,
which the public was duly warned of through the Notice of
Loss the plaintiff caused to be published in a daily
newspaper. This confirmed the plaintiff’s claim that the
receipts presented by the defendants were spurious ones.
The Case on Appeal
On appeal, the appellants interposed the following
assignment of errors:
I
THE TRIAL COURT ERRED IN FINDING THAT THE
RECEIPTS PRESENTED BY DEFENDANTS
EVIDENCING HIS PAYMENTS TO PLAINTIFF SAN
MIGUEL CORPORATION, ARE SPURIOUS.
II
THE TRIAL COURT ERRED IN CONCLUDING THAT
PLAINTIFF-APPELLEE HAS SUFFICIENTLY
 PROVED ITS CAUSE OF ACTION AGAINST THE
DEFENDANTS.
III
THE TRIAL COURT ERRED IN ORDERING
DEFENDANTS TO PAY 20% OF THE AMOUNT DUE
TO PLAINTIFF AS ATTORNEY’S FEES.12
The appellants asserted that while the trial court’s
observations were true, it was the usual business practice in
previous transactions between them and SMC. The SMC
previously honored receipts not bearing the salesman’s
name. According to appellant Francisco Culaba, he even lost
some of the receipts, but did not encounter any problems.
According to appellant Francisco, he could not be faulted for
paying the SMC collector who came in a van and was in
uniform, and that any regular customer would, without any
apprehension, transact with such an SMC employee.
Furthermore, the respective receipts issued to him at the
time he paid on the four occasions mentioned had not yet
then been declared lost. Thus, the subsequent publication in
a daily newspaper declaring the booklets lost did not affect
the validity and legality of the payments made. Accordingly,
by its actuations, the SMC was estopped from questioning
the legality of the payments and had no cause of action
against the appellants.
Anent the issue of attorney’s fees, the order of the trial court
for payment thereof is without basis. According to the
appellant, the provision for attorney’s fees is a contingent
fee, already provided for in the SMC’s contract with the law
firm. To further order them to pay 20% of the amount due as
attorney’s fees is double payment, tantamount to undue
enrichment and therefore improper.13
The appellee, for its part, contended that the primary issue in
the case at bar revolved around the basic and fundamental
principles of agency.14 It was incumbent upon the
defendants-appellants to exercise ordinary prudence and
reasonable diligence to verify and identify the extent of the
alleged agent’s authority. It was their burden to establish the
true identity of the assumed agent, and this could not be
established by mere representation, rumor or general
reputation. As they utterly failed in this regard, the appellants
must suffer the consequences.
The Court of Appeals affirmed the decision of the trial court,
thus:
In the face of the somewhat tenuous evidence
presented by the appellants, we cannot fault the lower
court for giving more weight to appellee’s testimonial
and documentary evidence, all of which establish with
some degree of preponderance the existence of the
account sued upon.
ALL CONSIDERED, we cannot find any justification
to reject the factual findings of the lower court to
which we must accord respect, for which reason, the
judgment appealed from is hereby AFFIRMED in all
respects.
SO ORDERED.15
Hence, the instant petition.
The petitioners pose the following issues for the Court’s
resolution:
I. WHETHER OR NOT THE RESPONDENT HAD
PROVEN BY PREPONDERANT EVIDENCE THAT IT
HAD PROPERLY AND TIMELY NOTIFIED
PETITIONER OF LOST BOOKLET OF RECEIPTS
II. WHETHER OR NOT RESPONDENT HAD
PROVEN BY PREPONDERANT EVIDENCE THAT
 PETITIONER WAS REMISS IN THE PAYMENT OF
HIS ACCOUNTS TO ITS AGENT.16
According to the petitioners, receiving receipts from the
private respondent’s agents instead of its salesmen was a
usual occurrence, as they had been operating the store
since 1979. Thus, on four occasions in April 1983, when an
agent of the respondent came to the store wearing an SMC
uniform and driving an SMC van, petitioner Francisco
Culaba, without question, paid his accounts. He received the
receipts without fear, as they were similar to what he used to
receive before. Furthermore, the petitioners assert that,
common experience will attest that unless the attention of
the customers is called for, they would not take note of the
serial number of the receipts.
The petitioners contend that the private respondent
advertised its warning to the public only after the damage
was done, or on July 9, 1993. Its belated notice showed its
glaring lack of interest or concern for its customers’ welfare,
and, in sum, its negligence.
Anent the second issue, petitioner Francisco Culaba avers
that the agent to whom the accounts were paid had all the
physical and material attributes or indications of a
representative of the private respondent, leaving no doubt
that he was duly authorized by the latter. Petitioner
Francisco Culaba’s testimony that "he does not necessarily
check the contents of the receipts issued to him except for
the amount indicated if [the] same accurately reflects his
actual payment" is a common attitude of customers. He
could, thus, not be faulted for paying the private
respondent’s agent on four occasions. Petitioner Francisco
Culaba asserts that he made the payment in good faith, to
an agent who issued SMC receipts which appeared to be
genuine. Thus, according to the petitioners, they had duly
paid their obligation in accordance with Articles 1240 and
1242 of the New Civil Code.
The private respondent, for its part, avers that the burden of
proving payment is with the debtor, in consonance with the
express provision of Article 1233 of the New Civil Code. The
petitioners miserably failed to prove the self-serving
allegation that they already paid their liability to the private
respondent. Furthermore, under normal circumstances, an
obligor would not just pay a substantial amount to someone
whom he saw for the first time, without even asking for the
latter’s name.
The Ruling of the Court
The petition is dismissed.
The petitioners question the findings of the Court of Appeals
as to whether the payment of the petitioners’ obligation to
the private respondent was properly made, thus,
extinguishing the same. This is clearly a factual issue, and
beyond the purview of the Court to delve into. This is in
consonance with the well-settled rule that findings of fact of
the trial court, especially when affirmed by the Court of
Appeals, are accorded the highest degree of respect, and
generally will not be disturbed on appeal. Such findings are
binding and conclusive on the Court.17 Furthermore, it is not
the Court’s function under Rule 45 of the Rules of Court, as
amended, to review, examine and evaluate or weigh the
probative value of the evidence presented.18
To reiterate, the issue being raised by the petitioners does
not involve a question of law, but a question of fact, not
cognizable by this Court in a petition for review under Rule
45. The jurisdiction of the Court in such a case is limited to
reviewing only errors of law, unless the factual findings being
assailed are not supported by evidence on record or the
impugned judgment is based on a misapprehension of
facts.19
A careful study of the records of the case reveal that the
appellate court affirmed the trial court’s factual findings as
follows:
First. Receipts Nos. 27331, 27318, 27339 and 27346 were
included in the private respondent’s lost booklet, which loss
was duly advertised in a newspaper of general circulation;
thus, the private respondent could not have officially issued
them to the petitioners to cover the alleged payments on the
dates appearing thereon.
Second. There was something amiss in the way the receipts
were issued to the petitioners, as one receipt bearing a
higher serial number was issued ahead of another receipt
bearing a lower serial number, supposedly covering a later
payment. The petitioners failed to explain the apparent mix-
up in these receipts, and no attempt was made in this
regard.
Third. The fact that the salesman’s name was invariably left
blank in the four receipts and that the petitioners could not
even remember the name of the supposed impostor who
received the said payments strongly argue against the
veracity of the petitioners’ claim.
We find no cogent reason to reverse the said findings.
The dismissal of the petition is inevitable even upon close
perusal of the merits of the case.
Payment is a mode of extinguishing an obligation.20 Article
1240 of the Civil Code provides that payment shall be made
to the person in whose favor the obligation has been
constituted, or his successor-in-interest, or any person
authorized to receive it.21 In this case, the payments were
purportedly made to a "supervisor" of the private respondent,
who was clad in an SMC uniform and drove an SMC van. He
appeared to be authorized to accept payments as he
showed a list of customers’ accountabilities and even issued
SMC liquidation receipts which looked genuine.
Unfortunately for petitioner Francisco Culaba, he did not
ascertain the identity and authority of the said supervisor,
nor did he ask to be shown any identification to prove that
the latter was, indeed, an SMC supervisor. The petitioners
relied solely on the man’s representation that he was
collecting payments for SMC. Thus, the payments the
petitioners claimed they made were not the payments that
discharged their obligation to the private respondent.
The basis of agency is representation.22 A person dealing
with an agent is put upon inquiry and must discover upon his
peril the authority of the agent.23 In the instant case, the
petitioners’ loss could have been avoided if they had simply
exercised due diligence in ascertaining the identity of the
person to whom they allegedly made the payments. The fact
that they were parting with valuable consideration should
have made them more circumspect in handling their
business transactions. Persons dealing with an assumed
agent are bound at their peril to ascertain not only the fact of
agency but also the nature and extent of authority, and in
case either is controverted, the burden of proof is upon them
to establish it.24 The petitioners in this case failed to
discharge this burden, considering that the private
respondent vehemently denied that the payments were
accepted by it and were made to its authorized
representative.
Negligence is the omission to do something which a
reasonable man, guided by those considerations which
ordinarily regulate the conduct of human affairs, would do, or
the doing of something, which a prudent and reasonable
man would not do.25 In the case at bar, the most prudent
thing the petitioners should have done was to ascertain the
identity and authority of the person who collected their
payments. Failing this, the petitioners cannot claim that they
acted in good faith when they made such payments. Their
claim therefor is negated by their negligence, and they are
bound by its consequences. Being negligent in this regard,
the petitioners cannot seek relief on the basis of a supposed
agency.26
WHEREFORE, the instant petition is hereby DENIED. The
assailed Decision dated April 16, 1996, and the Resolution
dated July 19, 1996 of the Court of Appeals are AFFIRMED.
Costs against the petitioners.
SO ORDERED.
G.R. No. 98695 January 27, 1993
JUAN J. SYQUIA, CORAZON C. SYQUIA, CARLOTA C.
SYQUIA, CARLOS C. SYQUIA and ANTHONY C. SYQUIA,
petitioners,
vs.
THE HONORABLE COURT OF APPEALS, and THE
MANILA MEMORIAL PARK CEMETERY, INC.,
respondents.
Pacis& Reyes Law Offices for petitioners.
Augusto S. San Pedro & Ari-Ben C. Sebastian for private
respondents.
CAMPOS, JR., J.:
Herein petitioners, Juan J. Syquia and Corazon C. Syquia,
Carlota C. Syquia, Carlos C. Syquia, and Anthony Syquia,
were the parents and siblings, respectively, of the deceased
Vicente Juan Syquia. On March 5, 1979, they filed a
complaint1 in the then Court of First Instance against herein
private respondent, Manila Memorial Park Cemetery, Inc. for
recovery of damages arising from breach of contract and/or
quasi-delict. The trial court dismissed the complaint.
The antecedent facts, as gathered by the respondent Court,
are as follows:
On March 5, 1979, Juan, Corazon, Carlota and
Anthony all surnamed Syquia, plaintiff-
appellants herein, filed a complaint for
damages against defendant-appellee, Manila
Memorial Park Cemetery, Inc.
The complaint alleged among others, that
pursuant to a Deed of Sale (Contract No. 6885)
dated August 27, 1969 and Interment Order
No. 7106 dated July 21, 1978 executed
between plaintiff-appellant Juan J. Syquia and
defendant-appellee, the former, father of
deceased Vicente Juan J. Syquia authorized
and instructed defendant-appellee to inter the
remains of deceased in the Manila Memorial
Park Cemetery in the morning of July 25, 1978
conformably and in accordance with
defendant-appellant's (sic) interment
procedures; that on September 4, 1978,
preparatory to transferring the said remains to
a newly purchased family plot also at the
Manila Memorial Park Cemetery, the concrete
vault encasing the coffin of the deceased was
removed from its niche underground with the
assistance of certain employees of defendant-
appellant (sic); that as the concrete vault was
being raised to the surface, plaintiffs-appellants
discovered that the concrete vault had a hole
approximately three (3) inches in diameter near
the bottom of one of the walls closing out the
width of the vault on one end and that for a
certain length of time (one hour, more or less),
water drained out of the hole; that because of
the aforesaid discovery, plaintiffs-appellants
became agitated and upset with concern that
the water which had collected inside the vault
might have risen as it in fact did rise, to the
level of the coffin and flooded the same as well
as the remains of the deceased with ill effects
thereto; that pursuant to an authority granted
by the Municipal Court of Parañaque, Metro
Manila on September 14, 1978, plaintiffs-
appellants with the assistance of licensed
morticians and certain personnel of defendant-
appellant (sic) caused the opening of the
concrete vault on September 15, 1978; that
upon opening the vault, the following became
apparent to the plaintiffs-appellants: (a) the
interior walls of the concrete vault showed
evidence of total flooding; (b) the coffin was
entirely damaged by water, filth and silt
causing the wooden parts to warp and
separate and to crack the viewing glass panel
located directly above the head and torso of
the deceased; (c) the entire lining of the coffin,
the clothing of the deceased, and the exposed
parts of the deceased's remains were
damaged and soiled by the action of the water
and silt and were also coated with filth.
Due to the alleged unlawful and malicious
breach by the defendant-appellee of its
obligation to deliver a defect-free concrete
vault designed to protect the remains of the
deceased and the coffin against the elements
which resulted in the desecration of deceased's
grave and in the alternative, because of
defendant-appellee's gross negligence
conformably to Article 2176 of the New Civil
Code in failing to seal the concrete vault, the
complaint prayed that judgment be rendered
ordering defendant-appellee to pay plaintiffs-
appellants P30,000.00 for actual damages,
P500,000.00 for moral damages, exemplary
damages in the amount determined by the
court, 20% of defendant-appellee's total liability
as attorney's fees, and expenses of litigation
and costs of suit.2
In dismissing the complaint, the trial court held that the
contract between the parties did not guarantee that the
cement vault would be waterproof; that there could be no
quasi-delict because the defendant was not guilty of any
fault or negligence, and because there was a pre-existing
contractual relation between the Syquias and defendant
Manila Memorial Park Cemetery, Inc.. The trial court also
noted that the father himself, Juan Syquia, chose the
gravesite despite knowing that said area had to be
constantly sprinkled with water to keep the grass green and
that water would eventually seep through the vault. The trial
court also accepted the explanation given by defendant for
boring a hole at the bottom side of the vault: "The hole had
to be bored through the concrete vault because if it has no
hole the vault will (sic) float and the grave would be filled
with water and the digging would caved (sic) in the earth, the
earth would caved (sic) in the (sic) fill up the grave."3
From this judgment, the Syquias appealed. They alleged that
the trial court erred in holding that the contract allowed the
flooding of the vault; that there was no desecration; that the
boring of the hole was justifiable; and in not awarding
damages.
The Court of Appeals in the Decision4 dated December 7,
1990 however, affirmed the judgment of dismissal.
Petitioner's motion for reconsideration was denied in a
Resolution dated April 25, 1991.5
Unsatisfied with the respondent Court's decision, the
Syquias filed the instant petition. They allege herein that the
Court of Appeals committed the following errors when it:
1. held that the contract and the Rules and
Resolutions of private respondent allowed the
 flooding of the vault and the entrance thereto of
filth and silt;
2. held that the act of boring a hole was
justifiable and corollarily, when it held that no
act of desecration was committed;
3. overlooked and refused to consider relevant,
undisputed facts, such as those which have
been stipulated upon by the parties, testified to
by private respondent's witnesses, and
admitted in the answer, which could have
justified a different conclusion;
4. held that there was no tort because of a pre-
existing contract and the absence of
fault/negligence; and
5. did not award the P25,000.00 actual
damages which was agreed upon by the
parties, moral and exemplary damages, and
attorney's fees.
At the bottom of the entire proceedings is the act of boring a
hole by private respondent on the vault of the deceased kin
of the bereaved petitioners. The latter allege that such act
was either a breach of private respondent's contractual
obligation to provide a sealed vault, or, in the alternative, a
negligent act which constituted a quasi-delict. Nonetheless,
petitioners claim that whatever kind of negligence private
respondent has committed, the latter is liable for desecrating
the grave of petitioners' dead.
In the instant case, We are called upon to determine whether
the Manila Memorial Park Cemetery, Inc., breached its
contract with petitioners; or, alternatively, whether private
respondent was guilty of a tort.
We understand the feelings of petitioners and empathize
with them. Unfortunately, however, We are more inclined to
answer the foregoing questions in the negative. There is not
enough ground, both in fact and in law, to justify a reversal of
the decision of the respondent Court and to uphold the pleas
of the petitioners.
With respect to herein petitioners' averment that private
respondent has committed culpa aquiliana, the Court of
Appeals found no negligent act on the part of private
respondent to justify an award of damages against it.
Although a pre-existing contractual relation between the
parties does not preclude the existence of a culpa aquiliana,
We find no reason to disregard the respondent's Court
finding that there was no negligence.
Art. 2176. Whoever by act or omission causes
damage to another, there being fault or
negligence, is obliged to pay for the damage
done. Such fault or negligence, if there is no
pre-existing contractual relation between the
parties, is called a quasi-delict . . . . (Emphasis
supplied).
In this case, it has been established that the Syquias
and the Manila Memorial Park Cemetery, Inc.,
entered into a contract entitled "Deed of Sale and
Certificate of Perpetual Care"6 on August 27, 1969.
That agreement governed the relations of the parties
and defined their respective rights and obligations.
Hence, had there been actual negligence on the part
of the Manila Memorial Park Cemetery, Inc., it would
be held liable not for a quasi-delict or culpa aquiliana,
but for culpacontractual as provided by Article 1170 of
the Civil Code, to wit:
Those who in the performance of their
obligations are guilty of fraud, negligence, or
delay, and those who in any manner
 contravene the tenor thereof, are liable for
damages.
The Manila Memorial Park Cemetery, Inc. bound itself to
provide the concrete box to be send in the interment. Rule
17 of the Rules and Regulations of private respondent
provides that:
Rule 17. Every earth interment shall be made
enclosed in a concrete box, or in an outer wall
of stone, brick or concrete, the actual
installment of which shall be made by the
employees of the Association.7
Pursuant to this above-mentioned Rule, a concrete vault was
provided on July 27, 1978, the day before the interment, and
was, on the same day, installed by private respondent's
employees in the grave which was dug earlier. After the
burial, the vault was covered by a cement lid.
Petitioners however claim that private respondent breached
its contract with them as the latter held out in the brochure it
distributed that the . . . lot may hold single or double
internment (sic) underground in sealed concrete vault."8
Petitioners claim that the vault provided by private
respondent was not sealed, that is, not waterproof.
Consequently, water seeped through the cement enclosure
and damaged everything inside it.
We do not agree. There was no stipulation in the Deed of
Sale and Certificate of Perpetual Care and in the Rules and
Regulations of the Manila Memorial Park Cemetery, Inc. that
the vault would be waterproof. Private respondent's witness,
Mr. Dexter Heuschkel, explained that the term "sealed"
meant "closed."9 On the other hand, the word "seal" is
defined as . . . any of various closures or fastenings . . . that
cannot be opened without rupture and that serve as a check
against tampering or unauthorized opening." 10 The
meaning that has been given by private respondent to the
word conforms with the cited dictionary definition. Moreover,
it is also quite clear that "sealed" cannot be equated with
"waterproof". Well settled is the rule that when the terms of
the contract are clear and leave no doubt as to the intention
of the contracting parties, then the literal meaning of the
stipulation shall control. 11 Contracts should be interpreted
according to their literal meaning and should not be
interpreted beyond their obvious intendment. 12 As ruled by
the respondent Court:
When plaintiff-appellant Juan J. Syquia affixed
his signature to the Deed of Sale (Exhibit "A")
and the attached Rules and Regulations
(Exhibit "1"), it can be assumed that he has
accepted defendant-appellee's undertaking to
merely provide a concrete vault. He can not
now claim that said concrete vault must in
addition, also be waterproofed (sic). It is basic
that the parties are bound by the terms of their
contract, which is the law between them (Rizal
Commercial Banking Corporation vs. Court of
Appeals, et al. 178 SCRA 739). Where there is
nothing in the contract which is contrary to law,
morals, good customs, public order, or public
policy, the validity of the contract must be
sustained (Phil. American Insurance Co. vs.
Judge Pineda, 175 SCRA 416). Consonant
with this ruling, a contracting party cannot incur
a liability more than what is expressly specified
in his undertaking. It cannot be extended by
implication, beyond the terms of the contract
(Rizal Commercial Banking Corporation vs.
Court of Appeals, supra). And as a rule of
evidence, where the terms of an agreement
are reduced to writing, the document itself,
being constituted by the parties as the
expositor of their intentions, is the only
instrument of evidence in respect of that
agreement which the law will recognize, so
 long as its (sic) exists for the purpose of
evidence (Starkie, Ev., pp. 648, 655,
Kasheenath vs. Chundy, 5 W.R. 68 cited in
Francisco, Revised Rules of Court in the Phil.
p. 153, 1973 Ed.). And if the terms of the
contract are clear and leave no doubt upon the
intention of the contracting parties, the literal
meaning of its stipulations shall control (Santos
vs. CA, et al., G. R. No. 83664, Nov. 13, 1989;
Prudential Bank & Trust Co. vs. Community
Builders Co., Inc., 165 SCRA 285; Balatero vs.
IAC, 154 SCRA 530). 13
We hold, therefore, that private respondent did not breach
the tenor of its obligation to the Syquias. While this may be
so, can private respondent be liable for culpa aquilianafor
boring the hole on the vault? It cannot be denied that the
hole made possible the entry of more water and soil than
was natural had there been no hole.
The law defines negligence as the "omission of that diligence
which is required by the nature of the obligation and
corresponds with the circumstances of the persons, of the
time and of the place." 14 In the absence of stipulation or
legal provision providing the contrary, the diligence to be
observed in the performance of the obligation is that which is
expected of a good father of a family.
The circumstances surrounding the commission of the
assailed act — boring of the hole — negate the allegation of
negligence. The reason for the act was explained by Henry
Flores, Interment Foreman, who said that:
Q It has been established in this
particular case that a certain
Vicente Juan Syquia was interred
on July 25, 1978 at the
Parañaque Cemetery of the
Manila Memorial Park Cemetery,
Inc., will you please tell the Hon.
Court what or whether you have
participation in connection with
said internment (sic)?
A A day before Juan (sic) Syquia
was buried our personnel dug a
grave. After digging the next
morning a vault was taken and
placed in the grave and when the
vault was placed on the grave a
hole was placed on the vault so
that water could come into the
vault because it was raining
heavily then because the vault
has no hole the vault will float
and the grave would be filled with
water and the digging would
caved (sic) in and the earth, the
earth would (sic) caved in and fill
up the grave. 15 (Emphasis ours)
Except for the foreman's opinion that the concrete vault may
float should there be a heavy rainfall, from the above-
mentioned explanation, private respondent has exercised
the diligence of a good father of a family in preventing the
accumulation of water inside the vault which would have
resulted in the caving in of earth around the grave filling the
same with earth.
Thus, finding no evidence of negligence on the part of
private respondent, We find no reason to award damages in
favor of petitioners.
In the light of the foregoing facts, and construed in the
language of the applicable laws and jurisprudence, We are
constrained to AFFIRM in toto the decision of the respondent
Court of Appeals dated December 7, 1990. No costs.
SO ORDERED.
G.R. No. L-12986 March 31, 1966
THE SPOUSES BERNABE AFRICA and SOLEDAD C.
AFRICA, and the HEIRS OF DOMINGA ONG, petitioners-
appellants,
vs.
CALTEX (PHIL.), INC., MATEO BOQUIREN and THE
COURT OF APPEALS, respondents-appellees.
Ross, Selph, Carrascoso and Janda for the respondents.
Bernabe Africa, etc. for the petitioners.
MAKALINTAL., J.:
This case is before us on a petition for review of the decision
of the Court of Appeals, which affirmed that of the Court of
First Instance of Manila dismissing petitioners' second
amended complaint against respondents.
The action is for damages under Articles 1902 and 1903 of
the old Civil Code. It appears that in the afternoon of March
18, 1948 a fire broke out at the Caltex service station at the
corner of Antipolo street and Rizal Avenue, Manila. It started
while gasoline was being hosed from a tank truck into the
underground storage, right at the opening of the receiving
tank where the nozzle of the hose was inserted. The fire
spread to and burned several neighboring houses, including
the personal properties and effects inside them. Their
owners, among them petitioners here, sued respondents
Caltex (Phil.), Inc. and Mateo Boquiren, the first as alleged
owner of the station and the second as its agent in charge of
operation. Negligence on the part of both of them was
attributed as the cause of the fire.
The trial court and the Court of Appeals found that
petitioners failed to prove negligence and that respondents
had exercised due care in the premises and with respect to
the supervision of their employees.
The first question before Us refers to the admissibility of
certain reports on the fire prepared by the Manila Police and
Fire Departments and by a certain Captain Tinio of the
Armed Forces of the Philippines. Portions of the first two
reports are as follows:
1. Police Department report: —
Investigation disclosed that at about 4:00 P.M.
March 18, 1948, while Leandro Flores was
transferring gasoline from a tank truck, plate
No. T-5292 into the underground tank of the
Caltex Gasoline Station located at the corner of
Rizal Avenue and Antipolo Street, this City, an
unknown Filipino lighted a cigarette and threw
the burning match stick near the main valve of
the said underground tank. Due to the gasoline
fumes, fire suddenly blazed. Quick action of
Leandro Flores in pulling off the gasoline hose
connecting the truck with the underground tank
prevented a terrific explosion. However, the
flames scattered due to the hose from which
the gasoline was spouting. It burned the truck
and the following accessorias and residences.
2. The Fire Department report: —
In connection with their allegation that the premises
was (sic) subleased for the installation of a coca-cola
and cigarette stand, the complainants furnished this
Office a copy of a photograph taken during the fire
and which is submitted herewith. it appears in this
picture that there are in the premises a coca-cola
cooler and a rack which according to information
gathered in the neighborhood contained cigarettes
 and matches, installed between the gasoline pumps
and the underground tanks.
The report of Captain Tinio reproduced information given by
a certain Benito Morales regarding the history of the gasoline
station and what the chief of the fire department had told him
on the same subject.
The foregoing reports were ruled out as "double hearsay" by
the Court of Appeals and hence inadmissible. This ruling is
now assigned as error. It is contended: first, that said reports
were admitted by the trial court without objection on the part
of respondents; secondly, that with respect to the police
report (Exhibit V-Africa) which appears signed by a Detective
Zapanta allegedly "for Salvador Capacillo," the latter was
presented as witness but respondents waived their right to
cross-examine him although they had the opportunity to do
so; and thirdly, that in any event the said reports are
admissible as an exception to the hearsay rule under section
35 of Rule 123, now Rule 130.
The first contention is not borne out by the record. The
transcript of the hearing of September 17, 1953 (pp. 167-
170) shows that the reports in question, when offered as
evidence, were objected to by counsel for each of
respondents on the ground that they were hearsay and that
they were "irrelevant, immaterial and impertinent." Indeed, in
the court's resolution only Exhibits J, K, K-5 and X-6 were
admitted without objection; the admission of the others,
including the disputed ones, carried no such explanation.
On the second point, although Detective Capacillo did take
the witness stand, he was not examined and he did not
testify as to the facts mentioned in his alleged report (signed
by Detective Zapanta). All he said was that he was one of
those who investigated "the location of the fire and, if
possible, gather witnesses as to the occurrence, and that he
brought the report with him. There was nothing, therefore, on
which he need be cross-examined; and the contents of the
report, as to which he did not testify, did not thereby become
competent evidence. And even if he had testified, his
testimony would still have been objectionable as far as
information gathered by him from third persons was
concerned.
Petitioners maintain, however, that the reports in
themselves, that is, without further testimonial evidence on
their contents, fall within the scope of section 35, Rule 123,
which provides that "entries in official records made in the
performance of his duty by a public officer of the Philippines,
or by a person in the performance of a duty specially
enjoined by law, are prima facie evidence of the facts therein
stated."
There are three requisites for admissibility under the rule just
mentioned: (a) that the entry was made by a public officer, or
by another person specially enjoined by law to do so; (b) that
it was made by the public officer in the performance of his
duties, or by such other person in the performance of a duty
specially enjoined by law; and (c) that the public officer or
other person had sufficient knowledge of the facts by him
stated, which must have been acquired by him personally or
through official information (Moran, Comments on the Rules
of Court, Vol. 3 [1957] p. 398).
Of the three requisites just stated, only the last need be
considered here. Obviously the material facts recited in the
reports as to the cause and circumstances of the fire were
not within the personal knowledge of the officers who
conducted the investigation. Was knowledge of such facts,
however, acquired by them through official information? As
to some facts the sources thereof are not even identified.
Others are attributed to Leopoldo Medina, referred to as an
employee at the gas station were the fire occurred; to
Leandro Flores, driver of the tank truck from which gasoline
was being transferred at the time to the underground tank of
the station; and to respondent Mateo Boquiren, who could
not, according to Exhibit V-Africa, give any reason as to the
origin of the fire. To qualify their statements as "official
information" acquired by the officers who prepared the
reports, the persons who made the statements not only must
have personal knowledge of the facts stated but must have
the duty to give such statements for record.1
The reports in question do not constitute an exception to the
hearsay rule; the facts stated therein were not acquired by
the reporting officers through official information, not having
been given by the informants pursuant to any duty to do so.
The next question is whether or not, without proof as to the
cause and origin of the fire, the doctrine of res ipsa loquitur
should apply so as to presume negligence on the part of
appellees. Both the trial court and the appellate court
refused to apply the doctrine in the instant case on the
grounds that "as to (its) applicability ... in the Philippines,
there seems to he nothing definite," and that while the rules
do not prohibit its adoption in appropriate cases, "in the case
at bar, however, we find no practical use for such doctrine."
The question deserves more than such summary dismissal.
The doctrine has actually been applied in this jurisdiction, in
the case of Espiritu vs. Philippine Power and Development
Co. (CA-G.R. No. 3240-R, September 20, 1949), wherein
the decision of the Court of Appeals was penned by Mr.
Justice J.B.L. Reyes now a member of the Supreme Court.
The facts of that case are stated in the decision as follows:
In the afternoon of May 5, 1946, while the plaintiff-
appellee and other companions were loading grass
between the municipalities of Bay and Calauan, in the
province of Laguna, with clear weather and without
any wind blowing, an electric transmission wire,
installed and maintained by the defendant Philippine
Power and Development Co., Inc. alongside the road,
suddenly parted, and one of the broken ends hit the
head of the plaintiff as he was about to board the
truck. As a result, plaintiff received the full shock of
4,400 volts carried by the wire and was knocked
unconscious to the ground. The electric charge
coursed through his body and caused extensive and
serious multiple burns from skull to legs, leaving the
bone exposed in some parts and causing intense pain
and wounds that were not completely healed when
the case was tried on June 18, 1947, over one year
after the mishap.
The defendant therein disclaimed liability on the ground that
the plaintiff had failed to show any specific act of negligence,
but the appellate court overruled the defense under the
doctrine of res ipsa loquitur. The court said:
The first point is directed against the sufficiency of
plaintiff's evidence to place appellant on its defense.
While it is the rule, as contended by the appellant,
that in case of noncontractual negligence, or culpa
aquiliana, the burden of proof is on the plaintiff to
establish that the proximate cause of his injury was
the negligence of the defendant, it is also a
recognized principal that "where the thing which
caused injury, without fault of the injured person, is
under the exclusive control of the defendant and the
injury is such as in the ordinary course of things does
not occur if he having such control use proper care, it
affords reasonable evidence, in the absence of the
explanation, that the injury arose from defendant's
want of care."
And the burden of evidence is shifted to him to
establish that he has observed due care and
diligence. (San Juan Light & Transit Co. v. Requena,
244, U.S. 89, 56 L. ed. 680.) This rule is known by the
name of res ipsa loquitur (the transaction speaks for
itself), and is peculiarly applicable to the case at bar,
where it is unquestioned that the plaintiff had every
right to be on the highway, and the electric wire was
under the sole control of defendant company. In the
 ordinary course of events, electric wires do not part
suddenly in fair weather and injure people, unless
they are subjected to unusual strain and stress or
there are defects in their installation, maintenance
and supervision; just as barrels do not ordinarily roll
out of the warehouse windows to injure passersby,
unless some one was negligent. (Byrne v. Boadle, 2
H & Co. 722; 159 Eng. Reprint 299, the leading case
that established that rule). Consequently, in the
absence of contributory negligence (which is
admittedly not present), the fact that the wire snapped
suffices to raise a reasonable presumption of
negligence in its installation, care and maintenance.
Thereafter, as observed by Chief Baron Pollock, "if
there are any facts inconsistent with negligence, it is
for the defendant to prove."
It is true of course that decisions of the Court of Appeals do
not lay down doctrines binding on the Supreme Court, but
we do not consider this a reason for not applying the
particular doctrine of res ipsa loquitur in the case at bar.
Gasoline is a highly combustible material, in the storage and
sale of which extreme care must be taken. On the other
hand, fire is not considered a fortuitous event, as it arises
almost invariably from some act of man. A case strikingly
similar to the one before Us is Jones vs. Shell Petroleum
Corporation, et al., 171 So. 447:
Arthur O. Jones is the owner of a building in the city of
Hammon which in the year 1934 was leased to the
Shell Petroleum Corporation for a gasoline filling
station. On October 8, 1934, during the term of the
lease, while gasoline was being transferred from the
tank wagon, also operated by the Shell Petroleum
Corporation, to the underground tank of the station, a
fire started with resulting damages to the building
owned by Jones. Alleging that the damages to his
building amounted to $516.95, Jones sued the Shell
Petroleum Corporation for the recovery of that
amount. The judge of the district court, after hearing
the testimony, concluded that plaintiff was entitled to a
recovery and rendered judgment in his favor for
$427.82. The Court of Appeals for the First Circuit
reversed this judgment, on the ground the testimony
failed to show with reasonable certainty any
negligence on the part of the Shell Petroleum
Corporation or any of its agents or employees.
Plaintiff applied to this Court for a Writ of Review
which was granted, and the case is now before us for
decision.1äwphï1.ñët
In resolving the issue of negligence, the Supreme Court of
Louisiana held:
Plaintiff's petition contains two distinct charges of
negligence — one relating to the cause of the fire and
the other relating to the spreading of the gasoline
about the filling station.
Other than an expert to assess the damages caused
plaintiff's building by the fire, no witnesses were
placed on the stand by the defendant.
Taking up plaintiff's charge of negligence relating to
the cause of the fire, we find it established by the
record that the filling station and the tank truck were
under the control of the defendant and operated by its
agents or employees. We further find from the
uncontradicted testimony of plaintiff's witnesses that
fire started in the underground tank attached to the
filling station while it was being filled from the tank
truck and while both the tank and the truck were in
charge of and being operated by the agents or
employees of the defendant, extended to the hose
and tank truck, and was communicated from the
burning hose, tank truck, and escaping gasoline to the
building owned by the plaintiff.
 Predicated on these circumstances and the further
circumstance of defendant's failure to explain the
cause of the fire or to show its lack of knowledge of
the cause, plaintiff has evoked the doctrine of res ipsa
loquitur. There are many cases in which the doctrine
may be successfully invoked and this, we think, is one
of them.
Where the thing which caused the injury complained
of is shown to be under the management of defendant
or his servants and the accident is such as in the
ordinary course of things does not happen if those
who have its management or control use proper care,
it affords reasonable evidence, in absence of
explanation by defendant, that the accident arose
from want of care. (45 C.J. #768, p. 1193).
This statement of the rule of res ipsa loquitur has
been widely approved and adopted by the courts of
last resort. Some of the cases in this jurisdiction in
which the doctrine has been applied are the following,
viz.: Maus v. Broderick, 51 La. Ann. 1153, 25 So. 977;
Hebert v. Lake Charles Ice, etc., Co., 111 La. 522, 35
So. 731, 64 L.R.A. 101, 100 Am. St. Rep. 505; Willis
v. Vicksburg, etc., R. Co., 115 La. 63, 38 So. 892;
Bents v. Page, 115 La. 560, 39 So. 599.
The principle enunciated in the aforequoted case applies
with equal force here. The gasoline station, with all its
appliances, equipment and employees, was under the
control of appellees. A fire occurred therein and spread to
and burned the neighboring houses. The persons who knew
or could have known how the fire started were appellees and
their employees, but they gave no explanation thereof
whatsoever. It is a fair and reasonable inference that the
incident happened because of want of care.
In the report submitted by Captain Leoncio Mariano of the
Manila Police Department (Exh. X-1 Africa) the following
appears:
Investigation of the basic complaint disclosed that the
Caltex Gasoline Station complained of occupies a lot
approximately 10 m x 10 m at the southwest corner of
Rizal Avenue and Antipolo. The location is within a
very busy business district near the Obrero Market, a
railroad crossing and very thickly populated
neighborhood where a great number of people mill
around t
until
gasoline
tever be theWactjvities of these peopleor lighting a
cigarette cannot be excluded and this constitute a
secondary hazard to its operation which in turn
endangers the entire neighborhood to conflagration.
Furthermore, aside from precautions already taken by
its operator the concrete walls south and west
adjoining the neighborhood are only 2-1/2 meters high
at most and cannot avoid the flames from leaping
over it in case of fire.
Records show that there have been two cases of fire
which caused not only material damages but
desperation and also panic in the neighborhood.
Although the soft drinks stand had been eliminated,
this gasoline service station is also used by its
operator as a garage and repair shop for his fleet of
taxicabs numbering ten or more, adding another risk
to the possible outbreak of fire at this already small
but crowded gasoline station.
The foregoing report, having been submitted by a police
officer in the performance of his duties on the basis of his
own personal observation of the facts reported, may properly
be considered as an exception to the hearsay rule. These
facts, descriptive of the location and objective circumstances
surrounding the operation of the gasoline station in question,
strengthen the presumption of negligence under the doctrine
of res ipsa loquitur, since on their face they called for more
stringent measures of caution than those which would satisfy
the standard of due diligence under ordinary circumstances.
There is no more eloquent demonstration of this than the
statement of Leandro Flores before the police investigator.
Flores was the driver of the gasoline tank wagon who, alone
and without assistance, was transferring the contents thereof
into the underground storage when the fire broke out. He
said: "Before loading the underground tank there were no
people, but while the loading was going on, there were
people who went to drink coca-cola (at the coca-cola stand)
which is about a meter from the hole leading to the
underground tank." He added that when the tank was almost
filled he went to the tank truck to close the valve, and while
he had his back turned to the "manhole" he, heard someone
shout "fire."
Even then the fire possibly would not have spread to the
neighboring houses were it not for another negligent
omission on the part of defendants, namely, their failure to
provide a concrete wall high enough to prevent the flames
from leaping over it. As it was the concrete wall was only 2-
1/2 meters high, and beyond that height it consisted merely
of galvanized iron sheets, which would predictably crumple
and melt when subjected to intense heat. Defendants'
negligence, therefore, was not only with respect to the cause
of the fire but also with respect to the spread thereof to the
neighboring houses.
There is an admission on the part of Boquiren in his
amended answer to the second amended complaint that "the
fire was caused through the acts of a stranger who, without
authority, or permission of answering defendant, passed
through the gasoline station and negligently threw a lighted
match in the premises." No evidence on this point was
adduced, but assuming the allegation to be true — certainly
any unfavorable inference from the admission may be taken
against Boquiren — it does not extenuate his negligence. A
decision of the Supreme Court of Texas, upon facts
analogous to those of the present case, states the rule which
we find acceptable here. "It is the rule that those who
distribute a dangerous article or agent, owe a degree of
protection to the public proportionate to and commensurate
with a danger involved ... we think it is the generally
accepted rule as applied to torts that 'if the effects of the
actor's negligent conduct actively and continuously operate
to bring about harm to another, the fact that the active and
substantially simultaneous operation of the effects of a third
person's innocent, tortious or criminal act is also a
substantial factor in bringing about the harm, does not
protect the actor from liability.' (Restatement of the Law of
Torts, vol. 2, p. 1184, #439). Stated in another way, "The
intention of an unforeseen and unexpected cause, is not
sufficient to relieve a wrongdoer from consequences of
negligence, if such negligence directly and proximately
cooperates with the independent cause in the resulting
injury." (MacAfee, et al. vs. Traver's Gas Corporation, 153
S.W. 2nd 442.)
The next issue is whether Caltex should be held liable for the
damages caused to appellants. This issue depends on
whether Boquiren was an independent contractor, as held by
the Court of Appeals, or an agent of Caltex. This question, in
the light of the facts not controverted, is one of law and
hence may be passed upon by this Court. These facts are:
(1) Boquiren made an admission that he was an agent of
Caltex; (2) at the time of the fire Caltex owned the gasoline
station and all the equipment therein; (3) Caltex exercised
control over Boquiren in the management of the state; (4)
the delivery truck used in delivering gasoline to the station
had the name of CALTEX painted on it; and (5) the license
to store gasoline at the station was in the name of Caltex,
which paid the license fees. (Exhibit T-Africa; Exhibit U-
Africa; Exhibit X-5 Africa; Exhibit X-6 Africa; Exhibit Y-
Africa).
In Boquiren's amended answer to the second amended
complaint, he denied that he directed one of his drivers to
remove gasoline from the truck into the tank and alleged that
the "alleged driver, if one there was, was not in his employ,
the driver being an employee of the Caltex (Phil.) Inc. and/or
the owners of the gasoline station." It is true that Boquiren
later on amended his answer, and that among the changes
was one to the effect that he was not acting as agent of
Caltex. But then again, in his motion to dismiss appellants'
second amended complaint the ground alleged was that it
stated no cause of action since under the allegations thereof
he was merely acting as agent of Caltex, such that he could
not have incurred personal liability. A motion to dismiss on
this ground is deemed to be an admission of the facts
alleged in the complaint.
Caltex admits that it owned the gasoline station as well as
the equipment therein, but claims that the business
conducted at the service station in question was owned and
operated by Boquiren. But Caltex did not present any
contract with Boquiren that would reveal the nature of their
relationship at the time of the fire. There must have been
one in existence at that time. Instead, what was presented
was a license agreement manifestly tailored for purposes of
this case, since it was entered into shortly before the
expiration of the one-year period it was intended to operate.
This so-called license agreement (Exhibit 5-Caltex) was
executed on November 29, 1948, but made effective as of
January 1, 1948 so as to cover the date of the fire, namely,
March 18, 1948. This retroactivity provision is quite
significant, and gives rise to the conclusion that it was
designed precisely to free Caltex from any responsibility with
respect to the fire, as shown by the clause that Caltex "shall
not be liable for any injury to person or property while in the
property herein licensed, it being understood and agreed
that LICENSEE (Boquiren) is not an employee,
representative or agent of LICENSOR (Caltex)."
But even if the license agreement were to govern, Boquiren
can hardly be considered an independent contractor. Under
that agreement Boquiren would pay Caltex the purely
nominal sum of P1.00 for the use of the premises and all the
equipment therein. He could sell only Caltex Products.
Maintenance of the station and its equipment was subject to
the approval, in other words control, of Caltex. Boquiren
could not assign or transfer his rights as licensee without the
consent of Caltex. The license agreement was supposed to
be from January 1, 1948 to December 31, 1948, and
thereafter until terminated by Caltex upon two days prior
written notice. Caltex could at any time cancel and terminate
the agreement in case Boquiren ceased to sell Caltex
products, or did not conduct the business with due diligence,
in the judgment of Caltex. Termination of the contract was
therefore a right granted only to Caltex but not to Boquiren.
These provisions of the contract show the extent of the
control of Caltex over Boquiren. The control was such that
the latter was virtually an employee of the former.
Taking into consideration the fact that the operator
owed his position to the company and the latter could
remove him or terminate his services at will; that the
service station belonged to the company and bore its
tradename and the operator sold only the products of
the company; that the equipment used by the
operator belonged to the company and were just
loaned to the operator and the company took charge
of their repair and maintenance; that an employee of
the company supervised the operator and conducted
periodic inspection of the company's gasoline and
service station; that the price of the products sold by
the operator was fixed by the company and not by the
operator; and that the receipts signed by the operator
indicated that he was a mere agent, the finding of the
 Court of Appeals that the operator was an agent of
the company and not an independent contractor
should not be disturbed.
To determine the nature of a contract courts do not
have or are not bound to rely upon the name or title
given it by the contracting parties, should thereby a
controversy as to what they really had intended to
enter into, but the way the contracting parties do or
perform their respective obligations stipulated or
agreed upon may be shown and inquired into, and
should such performance conflict with the name or
title given the contract by the parties, the former must
prevail over the latter. (Shell Company of the
Philippines, Ltd. vs. Firemens' Insurance Company of
Newark, New Jersey, 100 Phil. 757).
The written contract was apparently drawn for the
purpose of creating the apparent relationship of
employer and independent contractor, and of avoiding
liability for the negligence of the employees about the
station; but the company was not satisfied to allow
such relationship to exist. The evidence shows that it
immediately assumed control, and proceeded to
direct the method by which the work contracted for
should be performed. By reserving the right to
terminate the contract at will, it retained the means of
compelling submission to its orders. Having elected to
assume control and to direct the means and methods
by which the work has to be performed, it must be
held liable for the negligence of those performing
service under its direction. We think the evidence was
sufficient to sustain the verdict of the jury. (Gulf
Refining Company v. Rogers, 57 S.W. 2d, 183).
Caltex further argues that the gasoline stored in the station
belonged to Boquiren. But no cash invoices were presented
to show that Boquiren had bought said gasoline from Caltex.
Neither was there a sales contract to prove the same.
As found by the trial court the Africas sustained a loss of
P9,005.80, after deducting the amount of P2,000.00
collected by them on the insurance of the house. The
deduction is now challenged as erroneous on the ground
that Article 2207 of the New Civil Code, which provides for
the subrogation of the insurer to the rights of the insured,
was not yet in effect when the loss took place. However,
regardless of the silence of the law on this point at that time,
the amount that should be recovered be measured by the
damages actually suffered, otherwise the principle
prohibiting unjust enrichment would be violated. With respect
to the claim of the heirs of Ong P7,500.00 was adjudged by
the lower court on the basis of the assessed value of the
property destroyed, namely, P1,500.00, disregarding the
testimony of one of the Ong children that said property was
worth P4,000.00. We agree that the court erred, since it is of
common knowledge that the assessment for taxation
purposes is not an accurate gauge of fair market value, and
in this case should not prevail over positive evidence of such
value. The heirs of Ong are therefore entitled to P10,000.00.
Wherefore, the decision appealed from is reversed and
respondents-appellees are held liable solidarily to
appellants, and ordered to pay them the aforesaid sum of
P9,005.80 and P10,000.00, respectively, with interest from
the filing of the complaint, and costs.
G.R. No. 130547 October 3, 2000
LEAH ALESNA REYES, ROSE NAHDJA, JOHNNY, and
minors LLOYD and KRISTINE, all surnamed REYES,
represented by their mother, LEAH ALESNA REYES,
petitioners,
vs.
SISTERS OF MERCY HOSPITAL, SISTER ROSE
PALACIO, DR. MARVIE BLANES, and DR. MARLYN
RICO, respondents.
DECISION
MENDOZA, J.:
This is a petition for review of the decision1 of the Court of
Appeals in CA-G.R. CV No. 36551 affirming the decision of
the Regional Trial Court, Branch IX, Cebu City which
dismissed a complaint for damages filed by petitioners
against respondents.
The facts are as follows:
Petitioner Leah Alesna Reyes is the wife of the late Jorge
Reyes. The other petitioners, namely, Rose Nahdja, Johnny,
Lloyd, and Kristine, all surnamed Reyes, were their children.
Five days before his death on January 8, 1987, Jorge had
been suffering from a recurring fever with chills. After he
failed to get relief from some home medication he was
taking, which consisted of analgesic, antipyretic, and
antibiotics, he decided to see the doctor.
On January 8, 1987, he was taken to the Mercy Community
Clinic by his wife. He was attended to by respondent Dr.
Marlyn Rico, resident physician and admitting physician on
duty, who gave Jorge a physical examination and took his
medical history. She noted that at the time of his admission,
Jorge was conscious, ambulatory, oriented, coherent, and
with respiratory distress.2 Typhoid fever was then prevalent
in the locality, as the clinic had been getting from 15 to 20
cases of typhoid per month.3 Suspecting that Jorge could be
suffering from this disease, Dr. Rico ordered a Widal Test, a
standard test for typhoid fever, to be performed on Jorge.
Blood count, routine urinalysis, stool examination, and
malarial smear were also made.4 After about an hour, the
medical technician submitted the results of the test from
which Dr. Rico concluded that Jorge was positive for typhoid
fever. As her shift was only up to 5:00 p.m., Dr. Rico
indorsed Jorge to respondent Dr. Marvie Blanes.
Dr. Marvie Blanes attended to Jorge at around six in the
evening. She also took Jorge’s history and gave him a
physical examination. Like Dr. Rico, her impression was that
Jorge had typhoid fever. Antibiotics being the accepted
treatment for typhoid fever, she ordered that a compatibility
test with the antibiotic chloromycetin be done on Jorge. Said
test was administered by nurse Josephine Pagente who also
gave the patient a dose of triglobe. As she did not observe
any adverse reaction by the patient to chloromycetin, Dr.
Blanes ordered the first five hundred milligrams of said
antibiotic to be administered on Jorge at around 9:00 p.m. A
second dose was administered on Jorge about three hours
later just before midnight.
At around 1:00 a.m. of January 9, 1987, Dr. Blanes was
called as Jorge’s temperature rose to 41°C. The patient also
experienced chills and exhibited respiratory distress,
nausea, vomiting, and convulsions. Dr. Blanes put him under
oxygen, used a suction machine, and administered
hydrocortisone, temporarily easing the patient’s convulsions.
When he regained consciousness, the patient was asked by
Dr. Blanes whether he had a previous heart ailment or had
suffered from chest pains in the past. Jorge replied he did
not.5 After about 15 minutes, however, Jorge again started
to vomit, showed restlessness, and his convulsions returned.
Dr. Blanes re-applied the emergency measures taken before
and, in addition, valium was administered. Jorge, however,
did not respond to the treatment and slipped into cyanosis, a
bluish or purplish discoloration of the skin or mucous
membrane due to deficient oxygenation of the blood. At
around 2:00 a.m., Jorge died. He was forty years old. The
cause of his death was "Ventricular Arrythemia Secondary to
Hyperpyrexia and typhoid fever."
On June 3, 1987, petitioners filed before the Regional Trial
Court of Cebu City a complaint6 for damages against
respondents Sisters of Mercy, Sister Rose Palacio, Dr.
Marvie Blanes, Dr. Marlyn Rico, and nurse Josephine
Pagente. On September 24, 1987, petitioners amended their
complaint to implead respondent Mercy Community Clinic as
additional defendant and to drop the name of Josephine
Pagente as defendant since she was no longer connected
with respondent hospital. Their principal contention was that
Jorge did not die of typhoid fever.7 Instead, his death was
due to the wrongful administration of chloromycetin. They
contended that had respondent doctors exercised due care
and diligence, they would not have recommended and
rushed the performance of the Widal Test, hastily concluded
that Jorge was suffering from typhoid fever, and
administered chloromycetin without first conducting sufficient
tests on the patient’s compatibility with said drug. They
charged respondent clinic and its directress, Sister Rose
Palacio, with negligence in failing to provide adequate
facilities and in hiring negligent doctors and nurses.8
Respondents denied the charges. During the pre-trial
conference, the parties agreed to limit the issues on the
following: (1) whether the death of Jorge Reyes was due to
or caused by the negligence, carelessness, imprudence, and
lack of skill or foresight on the part of defendants; (2)
whether respondent Mercy Community Clinic was negligent
in the hiring of its employees; and (3) whether either party
was entitled to damages. The case was then heard by the
trial court during which, in addition to the testimonies of the
parties, the testimonies of doctors as expert witnesses were
presented.
Petitioners offered the testimony of Dr. ApolinarVacalares,
Chief Pathologist at the Northern Mindanao Training
Hospital, Cagayan de Oro City. On January 9, 1987, Dr.
Vacalares performed an autopsy on Jorge Reyes to
determine the cause of his death. However, he did not open
the skull to examine the brain. His findings9 showed that the
gastro-intestinal tract was normal and without any ulceration
or enlargement of the nodules. Dr. Vacalares testified that
Jorge did not die of typhoid fever. He also stated that he had
not seen a patient die of typhoid fever within five days from
the onset of the disease.
For their part, respondents offered the testimonies of Dr.
Peter Gotiong and Dr. Ibarra Panopio. Dr. Gotiong is a
diplomate in internal medicine whose expertise is
microbiology and infectious diseases. He is also a consultant
at the Cebu City Medical Center and an associate professor
of medicine at the South Western University College of
Medicine in Cebu City. He had treated over a thousand
cases of typhoid patients. According to Dr. Gotiong, the
patient’s history and positive Widal Test results ratio of 1:320
would make him suspect that the patient had typhoid fever.
As to Dr. Vacalares’ observation regarding the absence of
ulceration in Jorge’s gastro-intestinal tract, Dr. Gotiong said
that such hyperplasia in the intestines of a typhoid victim
may be microscopic. He noted that since the toxic effect of
typhoid fever may lead to meningitis, Dr. Vacalares’ autopsy
should have included an examination of the brain.10
The other doctor presented was Dr. Ibarra Panopio, a
member of the American Board of Pathology, examiner of
the Philippine Board of Pathology from 1978 to 1991, fellow
of the Philippine Society of Pathologist, associate professor
of the Cebu Institute of Medicine, and chief pathologist of the
Andres Soriano Jr. Memorial Hospital in Toledo City. Dr.
Panopio stated that although he was partial to the use of the
culture test for its greater reliability in the diagnosis of
typhoid fever, the Widal Test may also be used. Like Dr.
Gotiong, he agreed that the 1:320 ratio in Jorge’s case was
already the maximum by which a conclusion of typhoid fever
may be made. No additional information may be deduced
from a higher dilution.11 He said that Dr. Vacalares’ autopsy
on Jorge was incomplete and thus inconclusive.
On September 12, 1991, the trial court rendered its decision
absolving respondents from the charges of negligence and
dismissing petitioners’ action for damages. The trial court
likewise dismissed respondents’ counterclaim, holding that,
in seeking damages from respondents, petitioners were
impelled by the honest belief that Jorge’s death was due to
the latter’s negligence.
Petitioners brought the matter to the Court of Appeals. On
July 31, 1997, the Court of Appeals affirmed the decision of
the trial court.
Hence this petition.
Petitioners raise the following assignment of errors:
I. THE HONORABLE COURT OF APPEALS
COMMITTED A REVERSIBLE ERROR WHEN IT
RULED THAT THE DOCTRINE OF RES IPSA
LOQUITUR IS NOT APPLICABLE IN THE INSTANT
CASE.
II. THE HONORABLE COURT OF APPEALS
COMMITTED REVERSIBLE ERROR WHEN IT
MADE AN UNFOUNDED ASSUMPTION THAT THE
LEVEL OF MEDICAL PRACTICE IS LOWER IN
ILIGAN CITY.
III. THE HONORABLE COURT OF APPEALS
GRAVELY ERRED WHEN IT RULED FOR A
LESSER STANDARD OF CARE AND DEGREE OF
DILIGENCE FOR MEDICAL PRACTICE IN ILIGAN
CITY WHEN IT APPRECIATE[D] NO DOCTOR’S
NEGLIGENCE IN THE TREATMENT OF JORGE
REYES.
Petitioner’s action is for medical malpractice. This is a
particular form of negligence which consists in the failure of
a physician or surgeon to apply to his practice of medicine
that degree of care and skill which is ordinarily employed by
the profession generally, under similar conditions, and in like
surrounding circumstances.12 In order to successfully
pursue such a claim, a patient must prove that the physician
or surgeon either failed to do something which a reasonably
prudent physician or surgeon would have done, or that he or
she did something that a reasonably prudent physician or
surgeon would not have done, and that the failure or action
caused injury to the patient.13 There are thus four elements
involved in medical negligence cases, namely: duty, breach,
injury, and proximate causation.
In the present case, there is no doubt that a physician-
patient relationship existed between respondent doctors and
Jorge Reyes. Respondents were thus duty-bound to use at
least the same level of care that any reasonably competent
doctor would use to treat a condition under the same
circumstances. It is breach of this duty which constitutes
actionable malpractice.14 As to this aspect of medical
malpractice, the determination of the reasonable level of
care and the breach thereof, expert testimony is essential.
Inasmuch as the causes of the injuries involved in
malpractice actions are determinable only in the light of
scientific knowledge, it has been recognized that expert
testimony is usually necessary to support the conclusion as
to causation.15
Res Ipsa Loquitur
There is a case when expert testimony may be dispensed
with, and that is under the doctrine of res ipsa loquitur. As
held in Ramos v. Court of Appeals:16
Although generally, expert medical testimony is relied upon
in malpractice suits to prove that a physician has done a
negligent act or that he has deviated from the standard
medical procedure, when the doctrine of res ipsa loquitor is
availed by the plaintiff, the need for expert medical testimony
is dispensed with because the injury itself provides the proof
of negligence. The reason is that the general rule on the
necessity of expert testimony applies only to such matters
clearly within the domain of medical science, and not to
matters that are within the common knowledge of mankind
which may be testified to by anyone familiar with the facts.
Ordinarily, only physicians and surgeons of skill and
experience are competent to testify as to whether a patient
has been treated or operated upon with a reasonable degree
of skill and care. However, testimony as to the statements
and acts of physicians and surgeons, external appearances,
and manifest conditions which are observable by any one
may be given by non-expert witnesses. Hence, in cases
where the res ipsa loquitur is applicable, the court is
permitted to find a physician negligent upon proper proof of
injury to the patient, without the aid of expert testimony,
where the court from its fund of common knowledge can
determine the proper standard of care. Where common
knowledge and experience teach that a resulting injury
would not have occurred to the patient if due care had been
exercised, an inference of negligence may be drawn giving
rise to an application of the doctrine of res ipsa loquitur
without medical evidence, which is ordinarily required to
show not only what occurred but how and why it occurred.
When the doctrine is appropriate, all that the patient must do
is prove a nexus between the particular act or omission
complained of and the injury sustained while under the
custody and management of the defendant without need to
produce expert medical testimony to establish the standard
of care. Resort to res ipsa loquitor is allowed because there
is no other way, under usual and ordinary conditions, by
which the patient can obtain redress for injury suffered by
him.
Thus, courts of other jurisdictions have applied the doctrine
in the following situations: leaving of a foreign object in the
body of the patient after an operation, injuries sustained on a
healthy part of the body which was not under, or in the area,
of treatment, removal of the wrong part of the body when
another part was intended, knocking out a tooth while a
patient’s jaw was under anesthetic for the removal of his
tonsils, and loss of an eye while the patient was under the
influence of anesthetic, during or following an operation for
appendicitis, among others.17
Petitioners asserted in the Court of Appeals that the doctrine
of res ipsa loquitur applies to the present case because
Jorge Reyes was merely experiencing fever and chills for
five days and was fully conscious, coherent, and ambulant
when he went to the hospital. Yet, he died after only ten
hours from the time of his admission.
This contention was rejected by the appellate court.
Petitioners now contend that all requisites for the application
of res ipsa loquitur were present, namely: (1) the accident
was of a kind which does not ordinarily occur unless
someone is negligent; (2) the instrumentality or agency
which caused the injury was under the exclusive control of
the person in charge; and (3) the injury suffered must not
have been due to any voluntary action or contribution of the
person injured.18
The contention is without merit. We agree with the ruling of
the Court of Appeals. In the Ramos case, the question was
whether a surgeon, an anesthesiologist, and a hospital
should be made liable for the comatose condition of a patient
scheduled for cholecystectomy.19 In that case, the patient
was given anesthesia prior to her operation. Noting that the
patient was neurologically sound at the time of her operation,
the Court applied the doctrine of res ipsa loquitur as mental
brain damage does not normally occur in a gallblader
operation in the absence of negligence of the
anesthesiologist. Taking judicial notice that anesthesia
procedures had become so common that even an ordinary
person could tell if it was administered properly, we allowed
the testimony of a witness who was not an expert. In this
case, while it is true that the patient died just a few hours
after professional medical assistance was rendered, there is
really nothing unusual or extraordinary about his death. Prior
to his admission, the patient already had recurring fevers
and chills for five days unrelieved by the analgesic,
antipyretic, and antibiotics given him by his wife. This shows
that he had been suffering from a serious illness and
professional medical help came too late for him.
Respondents alleged failure to observe due care was not
immediately apparent to a layman so as to justify application
of res ipsa loquitur. The question required expert opinion on
the alleged breach by respondents of the standard of care
required by the circumstances. Furthermore, on the issue of
the correctness of her diagnosis, no presumption of
negligence can be applied to Dr. MarlynRico.As held in
Ramos:
. . . . Res ipsa loquitur is not a rigid or ordinary doctrine to be
perfunctorily used but a rule to be cautiously applied,
depending upon the circumstances of each case. It is
generally restricted to situations in malpractice cases where
a layman is able to say, as a matter of common knowledge
and observation, that the consequences of professional care
were not as such as would ordinarily have followed if due
care had been exercised. A distinction must be made
between the failure to secure results, and the occurrence of
something more unusual and not ordinarily found if the
service or treatment rendered followed the usual procedure
of those skilled in that particular practice. It must be
conceded that the doctrine of res ipsa loquitur can have no
application in a suit against a physician or a surgeon which
involves the merits of a diagnosis or of a scientific treatment.
The physician or surgeon is not required at his peril to
explain why any particular diagnosis was not correct, or why
any particular scientific treatment did not produce the
desired result.20
Specific Acts of Negligence
We turn to the question whether petitioners have established
specific acts of negligence allegedly committed by
respondent doctors.
Petitioners contend that: (1) Dr. Marlyn Rico hastily and
erroneously relied upon the Widal test, diagnosed Jorge’s
illness as typhoid fever, and immediately prescribed the
administration of the antibiotic chloromycetin;21 and (2) Dr.
Marvie Blanes erred in ordering the administration of the
second dose of 500 milligrams of chloromycetin barely three
hours after the first was given.22 Petitioners presented the
testimony of Dr. ApolinarVacalares, Chief Pathologist of the
Northern Mindanao Training Hospital, Cagayan de Oro City,
who performed an autopsy on the body of Jorge Reyes. Dr.
Vacalares testified that, based on his findings during the
autopsy, Jorge Reyes did not die of typhoid fever but of
shock undetermined, which could be due to allergic reaction
or chloromycetin overdose. We are not persuaded.
First. While petitioners presented Dr. ApolinarVacalares as
an expert witness, we do not find him to be so as he is not a
specialist on infectious diseases like typhoid fever.
Furthermore, although he may have had extensive
experience in performing autopsies, he admitted that he had
yet to do one on the body of a typhoid victim at the time he
conducted the postmortem on Jorge Reyes. It is also plain
from his testimony that he has treated only about three
cases of typhoid fever. Thus, he testified that:23
ATTY. PASCUAL:
Q Why? Have you not testified earlier that you have never
seen a patient who died of typhoid fever?
A In autopsy. But, that was when I was a resident physician
yet.
Q But you have not performed an autopsy of a patient who
died of typhoid fever?
A I have not seen one.
Q And you testified that you have never seen a patient who
died of typhoid fever within five days?
A I have not seen one.
Q How many typhoid fever cases had you seen while you
were in the general practice of medicine?
A In our case we had no widal test that time so we cannot
consider that the typhoid fever is like this and like that. And
the widal test does not specify the time of the typhoid fever.
Q The question is: how many typhoid fever cases had you
seen in your general practice regardless of the cases now
you practice?
A I had only seen three cases.
Q And that was way back in 1964?
A Way back after my training in UP.
Q Clinically?
A Way back before my training.
He is thus not qualified to prove that Dr. Marlyn Rico erred in
her diagnosis. Both lower courts were therefore correct in
discarding his testimony, which is really inadmissible.
In Ramos, the defendants presented the testimony of a
pulmonologist to prove that brain injury was due to oxygen
deprivation after the patient had bronchospasms24 triggered
by her allergic response to a drug,25 and not due to faulty
intubation by the anesthesiologist. As the issue was whether
the intubation was properly performed by an
anesthesiologist, we rejected the opinion of the
pulmonologist on the ground that he was not: (1) an
anesthesiologist who could enlighten the court about
anesthesia practice, procedure, and their complications; nor
(2) an allergologist who could properly advance expert
opinion on allergic mediated processes; nor (3) a
pharmacologist who could explain the pharmacologic and
toxic effects of the drug allegedly responsible for the
bronchospasms.
Second. On the other hand, the two doctors presented by
respondents clearly were experts on the subject. They
vouched for the correctness of Dr. Marlyn Rico’s diagnosis.
Dr. Peter Gotiong, a diplomate whose specialization is
infectious diseases and microbiology and an associate
professor at the Southwestern University College of
Medicine and the Gullas College of Medicine, testified that
he has already treated over a thousand cases of typhoid
fever.26 According to him, when a case of typhoid fever is
suspected, the Widal test is normally used,27 and if the
1:320 results of the Widal test on Jorge Reyes had been
presented to him along with the patient’s history, his
impression would also be that the patient was suffering from
typhoid fever.28 As to the treatment of the disease, he
stated that chloromycetin was the drug of choice.29 He also
explained that despite the measures taken by respondent
doctors and the intravenous administration of two doses of
chloromycetin, complications of the disease could not be
discounted. His testimony is as follows:30
ATTY. PASCUAL:
Q If with that count with the test of positive for 1 is to 320,
what treatment if any would be given?
A If those are the findings that would be presented to me,
the first thing I would consider would be typhoid fever.
Q And presently what are the treatments commonly used?
A Drug of choice of chloramphenical.
Q Doctor, if given the same patient and after you have
administered chloramphenical about 3 1/2 hours later, the
patient associated with chills, temperature - 41oC, what could
possibly come to your mind?
A Well, when it is change in the clinical finding, you have to
think of complication.
Q And what will you consider on the complication of typhoid?
A One must first understand that typhoid fever is toximia.
The problem is complications are caused by toxins produced
by the bacteria . . . whether you have suffered complications
to think of -- heart toxic myocardities; then you can consider
a toxic meningitis and other complications and perforations
and bleeding in the ilium.
Q Even that 40-year old married patient who received
medication of chloromycetin of 500 milligrams intravenous,
after the skin test, and received a second dose of
chloromycetin of 500 miligrams, 3 hours later, the patient
developed chills . . . rise in temperature to 41oC, and then
about 40 minutes later the temperature rose to 100oF,
cardiac rate of 150 per minute who appeared to be coherent,
restless, nauseating, with seizures: what significance could
you attach to these clinical changes?
A I would then think of toxemia, which was toxic meningitis
and probably a toxic meningitis because of the high cardiac
rate.
Q Even if the same patient who, after having given
intramuscular valium, became conscious and coherent about
20 minutes later, have seizure and cyanosis and rolling of
eyeballs and vomitting . . . and death: what significance
would you attach to this development?
A We are probably dealing with typhoid to meningitis.
Q In such case, Doctor, what finding if any could you expect
on the post-mortem examination?
A No, the finding would be more on the meninges or
covering of the brain.
Q And in order to see those changes would it require
opening the skull?
A Yes.
As regards Dr. Vacalares’ finding during the autopsy that the
deceased’s gastro-intestinal tract was normal, Dr. Rico
explained that, while hyperplasia31 in the payer’s patches or
layers of the small intestines is present in typhoid fever, the
same may not always be grossly visible and a microscope
was needed to see the texture of the cells.32
Respondents also presented the testimony of Dr. Ibarra T.
Panopio who is a member of the Philippine and American
Board of Pathology, an examiner of the Philippine Board of
Pathology, and chief pathologist at the MetroCebu
Community Hospital, Perpetual Succor Hospital, and the
Andres Soriano Jr. Memorial Medical Center. He stated that,
as a clinical pathologist, he recognized that the Widal test is
used for typhoid patients, although he did not encourage its
use because a single test would only give a presumption
necessitating that the test be repeated, becoming more
conclusive at the second and third weeks of the disease.33
He corroborated Dr. Gotiong’s testimony that the danger with
typhoid fever is really the possible complications which could
develop like perforation, hemorrhage, as well as liver and
cerebral complications.34 As regards the 1:320 results of the
Widal test on Jorge Reyes, Dr. Panopio stated that no
additional information could be obtained from a higher
ratio.35 He also agreed with Dr. Gotiong that hyperplasia in
the payer’s patches may be microscopic.36
Indeed, the standard contemplated is not what is actually the
average merit among all known practitioners from the best to
the worst and from the most to the least experienced, but the
reasonable average merit among the ordinarily good
physicians.37 Here, Dr. Marlyn Rico did not depart from the
reasonable standard recommended by the experts as she in
fact observed the due care required under the
circumstances. Though the Widal test is not conclusive, it
remains a standard diagnostic test for typhoid fever and, in
the present case, greater accuracy through repeated testing
was rendered unobtainable by the early death of the patient.
The results of the Widal test and the patient’s history of fever
with chills for five days, taken with the fact that typhoid fever
was then prevalent as indicated by the fact that the clinic had
been getting about 15 to 20 typhoid cases a month, were
sufficient to give upon any doctor of reasonable skill the
impression that Jorge Reyes had typhoid fever.
Dr. Rico was also justified in recommending the
administration of the drug chloromycetin, the drug of choice
for typhoid fever. The burden of proving that Jorge Reyes
was suffering from any other illness rested with the
petitioners. As they failed to present expert opinion on this,
preponderant evidence to support their contention is clearly
absent.
Third. Petitioners contend that respondent Dr. Marvie
Blanes, who took over from Dr. Rico, was negligent in
ordering the intravenous administration of two doses of 500
milligrams of chloromycetin at an interval of less than three
hours. Petitioners claim that Jorge Reyes died of
anaphylactic shock38 or possibly from overdose as the
second dose should have been administered five to six
hours after the first, per instruction of Dr. Marlyn Rico. As
held by the Court of Appeals, however:
That chloromycetin was likewise a proper prescription is best
established by medical authority. Wilson, et. al., in Harrison’s
Principle of Internal Medicine, 12th ed. write that
chlorampenicol (which is the generic of chloromycetin) is the
drug of choice for typhoid fever and that no drug has yet
proven better in promoting a favorable clinical response.
"Chlorampenicol (Chloromycetin) is specifically indicated for
bacterial meningitis, typhoid fever, rickettsial infections,
bacteriodes infections, etc." (PIMS Annual, 1994, p. 211)
The dosage likewise including the first administration of five
hundred milligrams (500 mg.) at around nine o’clock in the
evening and the second dose at around 11:30 the same
night was still within medically acceptable limits, sincethe
recommended dose of chloromycetin is one (1) gram every
six (6) hours. (cf. Pediatric Drug Handbook, 1st Ed.,
Philippine Pediatric Society, Committee on Therapeutics and
Toxicology, 1996). The intravenous route is likewise correct.
(Mansser, O’Nick, Pharmacology and Therapeutics) Even if
the test was not administered by the physician-on-duty, the
evidence introduced that it was Dra. Blanes who interpreted
the results remain uncontroverted. (Decision, pp. 16-17)
Once more, this Court rejects any claim of professional
negligence in this regard.
....
As regards anaphylactic shock, the usual way of guarding
against it prior to the administration of a drug, is the skin test
of which, however, it has been observed: "Skin testing with
haptenic drugs is generally not reliable. Certain drugs cause
nonspecific histamine release, producing a weal-and-flare
reaction in normal individuals. Immunologic activation of
mast cells requires a polyvalent allergen, so a negative skin
test to a univalent haptenic drug does not rule out
anaphylactic sensitivity to that drug." (Terr, "Anaphylaxis and
Urticaria" in Basic and Clinical Immunology, p. 349) What all
this means legally is that even if the deceased suffered from
an anaphylactic shock, this, of itself, would not yet establish
the negligence of the appellee-physicians for all that the law
requires of them is that they perform the standard tests and
perform standard procedures. The law cannot require them
to predict every possible reaction to all drugs administered.
The onus probandi was on the appellants to establish,
before the trial court, that the appellee-physicians ignored
standard medical procedure, prescribed and administered
medication with recklessness and exhibited an absence of
the competence and skills expected of general practitioners
similarly situated.39
Fourth. Petitioners correctly observe that the medical
profession is one which, like the business of a common
carrier, is affected with public interest. Moreover, they assert
that since the law imposes upon common carriers the duty of
observing extraordinary diligence in the vigilance over the
goods and for the safety of the passengers,40 physicians
and surgeons should have the same duty toward their
patients.41 They also contend that the Court of Appeals
erred when it allegedly assumed that the level of medical
practice is lower in Iligan City, thereby reducing the standard
of care and degree of diligence required from physicians and
surgeons in Iligan City.
The standard of extraordinary diligence is peculiar to
common carriers. The Civil Code provides:
Art. 1733. Common carriers, from the nature of their
business and for reasons of public policy, are bound to
observe extraordinary diligence in the vigilance over the
goods and for the safety of the passengers transported by
them, according to the circumstances of each case. . . .
The practice of medicine is a profession engaged in only by
qualified individuals.1âwphi1 It is a right earned through
years of education, training, and by first obtaining a license
from the state through professional board examinations.
Such license may, at any time and for cause, be revoked by
the government. In addition to state regulation, the conduct
of doctors is also strictly governed by the Hippocratic Oath,
an ancient code of discipline and ethical rules which doctors
have imposed upon themselves in recognition and
acceptance of their great responsibility to society. Given
these safeguards, there is no need to expressly require of
doctors the observance of "extraordinary" diligence. As it is
now, the practice of medicine is already conditioned upon
the highest degree of diligence. And, as we have already
noted, the standard contemplated for doctors is simply the
reasonable average merit among ordinarily good physicians.
That is reasonable diligence for doctors or, as the Court of
Appeals called it, the reasonable "skill and competence . . .
that a physician in the same or similar locality . . . should
apply."
WHEREFORE, the instant petition is DENIED and the
decision of the Court of Appeals is AFFIRMED.
SO ORDERED.
G.R. No. 83589 March 13, 1991
RAMON FAROLAN as ACTING COMMISSIONER OF
CUSTOMS, and GUILLERMO PARAYNO, as CHIEF OF
CUSTOM INTELLIGENCE and INVESTIGATION
DIVISION, petitioners,
vs.
SOLMAC MARKETING CORPORATION and COURT OF
APPEALS, respondents.
Dakila F. Castro & Associates for private respondent.
SARMIENTO, J.:
This petition for review on certiorari, instituted by the Solicitor
General on behalf of the public officers-petitioners, seek the
nullification and setting aside of the Resolution1 dated May
25, 1988 of the Court of Appeals in CA-G.R. No. SP-10509,
entitled "Solmac Marketing Corporation vs. Ramon Farolan,
Acting Commissioner of Customs, and Guillermo Parayno,
Chief of Customs Intelligence and Investigation Division,"
which adjudged these public officers to pay solidarily and in
their private personal capacities respondent Solmac
Marketing Corporation temperate damages in the sum of
P100,000.00, exemplary damages in the sum of P50,000.00,
and P25,000.00, as attorney's fees and expenses of
litigation. This challenged resolution of the respondent court
modified its decision2 of July 27, 1987 by reducing into
halves the original awards of P100,000.00 and P50,000.00
for exemplary damages and attorney's fees and litigation
expenses, respectively, keeping intact the original grant of
P100,000.00 in the concept of temperate damages.
(Strangely, the first name of petitioner Farolan stated in the
assailed resolution, as well as in the decision, of the
respondent court is "Damian" when it should be "Ramon",
his correct given name. Strictly speaking, petitioner Ramon
Farolan could not be held liable under these decision and
resolution for he is not the one adjudged to pay the huge
damages but a different person. Nonetheless, that is of no
moment now considering the disposition of thisponencia.)
The relevant facts, as culled from the records, are as follows:
At the time of the commission of the acts complained of by
the private respondent, which was the subject of the latter's
petition for mandamus and injunction filed with the Regional
Trial Court (RTC) of Manila in Civil Case No. 84-23537,
petitioner Ramon Farolan was then the Acting Commissioner
of Customs while petitioner Guillermo Parayno was then the
Acting Chief, Customs Intelligence and Investigation
Division. They were thus sued in their official capacities as
officers in the government as clearly indicated in the title of
the case in the lower courts and even here in this Court.
Nevertheless, they were both held personally liable for the
awarded damages "(s)ince the detention of the goods by the
defendants (petitioners herein) was irregular and devoid of
legal basis, hence, not done in the regular performance of
official duty . . . ."3
However, as adverted to at the outset, in the dispositive
portion of the challenged resolution, the one held personally
liable is a "Damian Farolan" and not the petitioner, Ramon
Farolan. Also as earlier mentioned, we will ignore that gross
error.
Private respondent Solmac Marketing Corporation is a
corporation organized and existing under the laws of the
Philippines. It was the assignee, transferee, and owner of an
importation of Clojus Recycling Plastic Products of 202,204
kilograms of what is technically known as polypropylene film,
valued at US$69,250.05.
Polypropylene is a substance resembling polyethelyne which
is one of a group of partially crystalline lightweight
thermoplastics used chiefly in making fibers, films, and
molded and extruded products.4
Without defect, polypropylene film is sold at a much higher
price as prime quality film. Once rejected as defective due to
blemishes, discoloration, defective winding, holes, etc.,
polypropylene film is sold at a relatively cheap price without
guarantee or return, and the buyer takes the risk as to
whether he can recover an average 30% to 50% usable
matter.5 This latter kind of polypropylene is known as OPP
film waste/scrap and this is what respondent SOLMAC
claimed the Clojus shipment to be.
The subject importation, consisting of seventeen (17)
containers, arrived in December, 1981. Upon application for
entry, the Bureau of Customs asked respondent SOLMAC
for its authority from any government agency to import the
goods described in the bill of lading. Respondent SOLMAC
presented a Board of Investment (BOI) authority for
polypropylene film scrap. However, upon examination of the
shipment by the National Institute of Science and
Technology (NIST), it turned out that the fibers of the
importation were oriented in such a way that the materials
were stronger than OPP film scrap.6 In other words, the
Clojus shipment was not OPP film scrap, as declared by the
assignee respondent SOLMAC to the Bureau of Customs
and BOI Governor Lilia R. Bautista, but oriented
polypropylene the importation of which is restricted, if not
prohibited, under Letter of Instructions (LOI) No. 658-B.
Specifically, Sections 1 and 2 of LOI No. 658-B provide that:
x xx x xx x xx
 1. The importation of cellophane shall be allowed only
for quantities and types of cellophane that cannot be
produced by Philippine Cellophane Film Corporation.
The Board of Investments shall issue guidelines
regulating such importations.
2. The Collector of Customs shall see to the
apprehension of all illegal importations of cellophane
and oriented polypropylene (OPP) and the dumping of
imported stock lots of cellophane and OPP.
x xx x xx x xx
Considering that the shipment was different from what had
been authorized by the BOI and by law, petitioners Parayno
and Farolan withheld the release of the subject importation.
On June 7, 1982, petitioner Parayno, then Chief of Customs
Intelligence and Investigation Division, wrote the BOI asking
for the latter's advice on whether or no t the subject
importation may be released7 A series of exchange of
correspondence between the BOI and the Bureau of
Customs, on one hand, and between the late Dakila Castro,
counsel for the private respondent, and the BOI and the
Bureau of Customs, on the other, ensued, to wit:
x xx x xx x xx
4. In a letter dated August 17, 1982, the BOI agreed
that the subject imports may be released but that
holes may be drilled on them by the Bureau of
Customs prior to their release.
5. On January 20, 1983, (the late) Atty. Dakila Castro,
(then) counsel of private respondent wrote to
petitioner Commissioner Farolan of Customs asking
for the release of the importation. The importation was
not released, however, on the ground that holes had
to be drilled on them first.
6. Atty. Dakila Castro then wrote a letter dated
October 6, 1983, to BOI Governor HermenigildoZayco
stressing the reasons why the subject importation
should be released without drilling of holes.
7. On November 8, 1983, BOI Governor H. Zayco
wrote a letter to the Bureau of Customs stating that
the subject goods may be released without drilling of
holes inasmuch as the goods arrived prior to the
endorsement on August 17, 1982 to the drilling of
holes on all importations of waste/scrap films.
8. On February 1, 1984, petitioner Commissioner
Farolan wrote the BOI requesting for definite
guidelines regarding the disposition of importations of
Oriented Polypropylene (OPP) and Polypropylene
(PP) then being held at the Bureau of Customs.
9. On March 12, 1984, Minister Roberto Ongpin of
Trade, the BOI Chairman, wrote his reply to petitioner
Farolan . . . .8 (This reply of Minister Ongpin is copied
in full infra.)
On March 26, 1984, respondent Solmac filed the action for
mandamus and injunction with the RTC as above
mentioned. It prayed for the unconditional release of the
subject importation. It also prayed for actual damages,
exemplary damages, and attorney's fees. As prayed for, the
trial court issued a writ of preliminary injunction.
After hearing on the merits, the RTC rendered a decision on
February 5, 1985, the dispositive portion of which reads as
follows:
Premises considered, judgment is hereby rendered
ordering defendants to release the subject importation
immediately without drilling of holes, subject only to
the normal requirements of the customs processing
for such release to be done with utmost dispatch as
 time is of the essence; and the preliminary injunction
hereto issued is hereby made permanent until actual
physical release of the merchandise and without
pronouncement as to costs.
SO ORDERED.9
From the decision of the trial court, Solmac, the plaintiff
below and the private respondent herein, appealed to the
Court of Appeals only insofar as to the denial of the award of
damages is concerned. On the other hand, the petitioners
did not appeal from this decision. They did not see any need
to appeal because as far as they were concerned, they had
already complied with their duty. They had already ordered
the release of the importation "without drilling of holes," as in
fact it was so released, in compliance with the advice to
effect such immediate release contained in a letter of BOI
dated October 9, 1984, to Commissioner Farolan. Thus, to
stress, even before the RTC rendered its decision on
February 5, 1984, the Clojus shipment of OPP was
released10 to the private respondent in its capacity as
assignee of the same. Be that it may, the private respondent
filed its appeal demanding that the petitioners be held, in
their personal and private capacities, liable for damages
despite the finding of lack of bad faith on the part of the
public officers.
After due proceeding, the Court of Appeals rendered a
decision11 on July 27, 1987, the dispositive portion which
reads as follows:
WHEREFORE, the appealed judgment is modified by
ordering the defendants Ramon Farolan and
Guillermo Parayno solidarity, in their personal
capacity, to pay the plaintiff temperate damages in the
sum of P100,000, exemplary damages in the sum of
P100,000 and P50,000 as attorney's fees and
expenses of litigation. Costs against the defendants.
SO ORDERED.
On August 14, 1987, the petitioners filed a motion for
reconsideration of the decision of the Court of Appeals.
On May 25, 1988, the Court of Appeals issued its resolution
modifying the award of damages, to wit: temperate damages
in the sum of P100,000,00, exemplary damages in the sum
of P50,000.00, and P25,000.00 as attorney's fees and
expenses of litigation. The respondent court explained the
reduction of the awards for exemplary damages and
attorney's fees and expenses of litigation in this wise:
3. In our decision of July 27, 1987, We awarded to
plaintiff-appellant Pl00,000 as temperate damages,
Pl00,000.00 as exemplary damages, and P50,000.00
as attorney's fees and expenses of litigation. Under
Art. 2233 of the Civil Code, recovery of exemplary
damages is not a matter of right but depends upon
the discretion of the court. Under Article 2208 of the
Civil Code, attorney's fees and expenses of litigation
must always be reasonable. In view of these
provisions of the law, and since the award of
temperate damages is only P100,000.00, the amount
of exemplary damages may not be at par as
temperate damages. An award of P50,000.00, as
exemplary damages may already serve the purpose,
i.e., as an example for the public good. Likewise, the
attorney's fees and expenses of litigation have to be
reduced to 25% of the amount of temperate damages,
or P25,000.00, if the same have to be reasonable.
The reduction in the amount of exemplary damages,
and attorney's fees and expenses of litigation would
be in accord with justice and fairness.12
The petitioners now come to this Court, again by the Solicitor
General, assigning the following errors allegedly committed
by the respondent court:
 I another. It is the opposite of fraud, and its absence should
The Court of Appeals erred in disregarding the finding
of the trial court that the defense of good faith of
petitioners (defendants) cannot be discredited.
II
The Court of Appeals erred in adjudging petitioners
liable to pay temperate damages, exemplary
damages, attorney's fees and expenses of
litigation.13
These two issues boil down to a single question, i.e.,
whether or not the petitioners acted in good faith in not
immediately releasing the questioned importation, or, simply,
can they be held liable, in their personal and private
capacities, for damages to the private respondent.
We rule for the petitioners.
The respondent court committed a reversible error in
overruling the trial court's finding that:
. . . with reference to the claim of plaintiff to damages,
actual and exemplary, and attorney's fees, the Court
finds it difficult to discredit or disregard totally the
defendants' defense of good faith premised on the
excuse that they were all the time awaiting
clarification of the Board of Investments on the
matter.14
We hold that this finding of the trial court is correct for good
faith is always presumed and it is upon him who alleges the
contrary that the burden of proof lies.15 In Abando v.
Lozada,16 we defined good faith as "refer[ring] to a state of
the mind which is manifested by the acts of the individual
concerned. It consists of the honest intention to abstain from
taking an unconscionable and unscrupulous advantage of
be established by convincing evidence."
We had reviewed the evidence on record carefully and we
did not see any clear and convincing proof showing the
alleged bad faith of the petitioners. On the contrary, the
record is replete with evidence bolstering the petitioners'
claim of good faith. First, there was the report of the National
Institute of Science and Technology (NIST) dated January
25, 1982 that, contrary to what the respondent claimed, the
subject importation was not OPP film scraps but oriented
polypropylene, a plastic product of stronger material, whose
importation to the Philippines was restricted, if not prohibited,
under LOI
658-B.17 It was on the strength of this finding that the
petitioners withheld the release of the subject importation for
being contrary to law. Second, the petitioners testified that,
on many occasions, the Bureau of Customs sought the
advice of the BOI on whether the subject importation might
be released.18 Third, petitioner Parayno also testified during
the trial that up to that time (of the trial) there was no clear-
cut policy on the part of the BOI regarding the entry into the
Philippines of oriented polypropylene (OPP), as the letters of
BOI Governors Tordesillas and Zayco of November 8, 1983
and September 24, 1982, respectively, ordering the release
of the subject importation did not clarify the BOI policy on the
matter. He then testified on the letter of the BOI Chairman
Roberto Ongpin dated March 12, 1984, which states in full:
Thank you for your letter of 1 February 1984, on the
subject of various importations of Oriented
Polypropylene (OPP) and Polypropylene (PP)
withheld by Customs and the confusion over the
disposition of such imports.
I have discussed the matter with Vice-Chairman
Tordesillas and Governor Zayco of the Board of
Investments and the following is their explanation:
 1. On 22 June 1982, the BOI ruled that importation of
OPP/PP film scraps intended for recycling or
repelletizing did not fall within the purview of LOI 658-
B.
2. On 17 August l982, the BOI agreed that holes
could be drilled on subject film imports to prevent their
use for other purposes.
3. For importations authorized prior to 22 June 1982,
the drilling of holes should depend on purpose for
which the importations was approved by the BOI that
is, for direct packaging use or for
recycling/repelletizing into raw material. The
exemption from drilling of holes on Solmac
Marketing's importation under Certificates of Authority
issued on 1 April 1982 and 5 May 1982 and on Clojus'
importation authorized in 1982 were endorsed by the
BOI on the premise that these were not intended for
recycling/repelletizing.
Should your office have any doubts as to the
authorized intended use of any imported lots of
OPP/PP film scraps that you have confiscated, we
have no objection to the drilling of holes to ensure that
these are indeed recycled.
I have requested Governor Zayco to contact your
office in order to offer any further assistance which
you may require.19
It can be seen from all the foregoing that even the highest
officers (Chairman Ongpin, Vice-Chairman Tordesillas, and
Governor Zayco) of the BOI themselves were not in
agreement as to what proper course to take on the subject of
the various importations of Oriented Polypropylene (OPP)
and Polypropylene (PP) withheld by the Bureau of Customs.
The conflicting recommendations of the BOI on this score
prompted the petitioners to seek final clarification from the
former with regard to its policy on these importations. This
resulted in the inevitable delay in the release of the Clojus
shipment, one of the several of such importations. The
confusion over the disposition of this particular importation
obviates bad faith. Thus the trial court's finding that the
petitioners acted in good faith in not immediately releasing
the Clojus shipment pending a definitive policy of the BOI on
this matter is correct. It is supported by substantial evidence
on record, independent of the presumption of good faith,
which as stated earlier, was not successfully rebutted.
When a public officer takes his oath of office, he binds
himself to perform the duties of his office faithfully and to use
reasonable skill and diligence, and to act primarily for the
benefit of the public. Thus, in the discharge of his duties, he
is to use that prudence, caution, and attention which careful
men use in the management of their affairs. In the case at
bar, prudence dictated that petitioners first obtain from the
BOI the latter's definite guidelines regarding the disposition
of the various importations of oriented polypropylene (OPP)
and polypropylene (PP) then being withheld at the Bureau of
Customs. These cellophane/film products were competing
with locally manufactured polypropylene and oriented
polypropylene as raw materials which were then already
sufficient to meet local demands, hence, their importation
was restricted, if not prohibited under LOI 658-B.
Consequently, the petitioners can not be said to have acted
in bad faith in not immediately releasing the import goods
without first obtaining the necessary clarificatory guidelines
from the BOI. As public officers, the petitioners had the duty
to see to it that the law they were tasked to implement, i.e.,
LOI 658-B, was faithfully complied with.
But even granting that the petitioners committed a mistake in
withholding the release of the subject importation because
indeed it was composed of OPP film scraps,20 contrary to
the evidence submitted by the National Institute of Science
and Technology that the same was pure oriented OPP,
nonetheless, it is the duty of the Court to see to it that public
officers are not hampered in the performance of their duties
or in making decisions for fear of personal liability for
damages due to honest mistake.1âwphi1 Whatever damage
they may have caused as a result of such an erroneous
interpretation, if any at all, is in the nature of a damnum
absque injuria. Mistakes concededly committed by public
officers are not actionable absent any clear showing that
they were motivated by malice or gross negligence
amounting to bad faith.21 After all, "even under the law of
public officers, the acts of the petitioners are protected by
the presumption of good faith.22
In the same vein, the presumption, disputable though it may
be, that an official duty has been regularly performed23
applies in favor of the petitioners. Omnia praesumuntur rite
et solemniteresse acta. (All things are presumed to be
correctly and solemnly done.) It was private respondent's
burden to overcome this juris tantum presumption. We are
not persuaded that it has been able to do so.
WHEREFORE, the petition is hereby GRANTED, the
assailed Resolution of the respondent court, in CA-G.R. SP
No. 10509, dated May 25, 1988, is SET ASIDE and
ANNULLED. No costs.
SO ORDERED.
G.R. No. 190022 February 15, 2012
PHILIPPINE NATIONAL RAILWAYS CORPORATION,
JAPHET ESTRANAS and BEN SAGA, Petitioners,
vs.
PURIFICACION VIZCARA, MARIVIC VIZCARA,
CRESENCIA A. NATIVIDAD, HECTOR VIZCARA, JOEL
VIZCARA and DOMINADOR ANTONIO, Respondents.
DECISION
REYES, J.:
Nature of the Petition
Before this Court is a petition for review on certiorari under
Rule 45 of the 1997 Rules of Civil Procedure, seeking to
annul and set aside the Decision1 dated July 21, 2009 of the
Court of Appeals (CA) in CA-G.R. CV No. 90021, which
affirmed with modification the Decision2 dated March 20,
2007 of the Regional Trial Court (RTC), Branch 40, Palayan
City, and Resolution3 dated October 26, 2009, which denied
the petitioners’ motion for reconsideration.
The Antecedent Facts
On May 14, 2004, at about three o’clock in the morning,
Reynaldo Vizcara (Reynaldo) was driving a passenger
jeepney headed towards Bicol to deliver onion crops, with
his companions, namely, CresencioVizcara (Cresencio),
Crispin Natividad (Crispin), Samuel Natividad (Samuel),
Dominador Antonio (Dominador) and Joel Vizcara (Joel).
While crossing the railroad track in Tiaong, Quezon, a
Philippine National Railways (PNR) train, then being
operated by respondent Japhet Estranas (Estranas),
suddenly turned up and rammed the passenger jeepney.
The collision resulted to the instantaneous death of
Reynaldo, Cresencio, Crispin, and Samuel. On the other
hand, Dominador and Joel, sustained serious physical
injuries.4
At the time of the accident, there was no level crossing
installed at the railroad crossing. Additionally, the "Stop,
Look and Listen" signage was poorly maintained. The "Stop"
signage was already faded while the "Listen" signage was
partly blocked by another signboard.5
On September 15, 2004, the survivors of the mishap, Joel
and Dominador, together with the heirs of the deceased
victims, namely, PurificacionVizcara, Marivic Vizcara,
Cresencia Natividad and Hector Vizcara, filed an action for
damages against PNR, Estranas and Ben Saga, the
alternate driver of the train, before the RTC of Palayan City. WHEREFORE, premises considered, judgment is hereby
The case was raffled to Branch 40 and was docketed as rendered ordering defendants Philippine National Railways
Civil Case No. 0365-P. In their complaint, the respondents Corporation (PNR), Japhet Estranas and Ben Saga to, jointly
alleged that the proximate cause of the fatalities and serious and severally pay the following amounts to:
physical injuries sustained by the victims of the accident was
the petitioners’ gross negligence in not providing adequate 1. a) PURIFICACION VIZCARA:
safety measures to prevent injury to persons and properties.
They pointed out that in the railroad track of Tiaong, Quezon 1) P50,000.00, as indemnity for the
where the accident happened, there was no level crossing death of Reynaldo Vizcara;
bar, lighting equipment or bell installed to warn motorists of
the existence of the track and of the approaching train. They 2) P35,000.00, for funeral expenses;
concluded their complaint with a prayer for actual, moral and
compensatory damages, as well as attorney’s fees.6 3) P5,000.00 for re-embalming
expenses;
For their part, the petitioners claimed that they exercised due
diligence in operating the train and monitoring its 4) P40,000.00 for wake/interment
roadworthiness. They asseverate that right before the expenses;
collision, Estranas was driving the train at a moderate speed.
Four hundred (400) meters away from the railroad crossing, 5) P300,000.00 as reimbursement for
he started blowing his horn to warn motorists of the the value of the jeepney with license
approaching train. When the train was only fifty (50) meters plate no. DTW-387;
away from the intersection, respondent Estranas noticed that
all vehicles on both sides of the track were already at a full 6) P200,000.00 as moral damages;
stop. Thus, he carefully proceeded at a speed of twenty-five
(25) kilometers per hour, still blowing the train’s horn. 7) P100,000.00 as exemplary damages;
However, when the train was already ten (10) meters away and
from the intersection, the passenger jeepney being driven by
Reynaldo suddenly crossed the tracks. Estranas 8) P20,000.00 for Attorney’s fees.
immediately stepped on the brakes to avoid hitting the
jeepney but due to the sheer weight of the train, it did not b) MARIVIC VIZCARA:
instantly come to a complete stop until the jeepney was
dragged 20 to 30 meters away from the point of collision.7 1) P50,000.00, as indemnity for the
death of CresencioVizcara;
The Ruling of the Trial Court
2) P200,000.00 as moral damages;
After trial on the merits, the RTC rendered its Decision8
dated March 20, 2007, ruling in favor of the respondents, the 3) P100,000.00 as exemplary damages;
dispositive portion of which reads: and
 4) P20,000.00 for Attorney’s fees.
c) HECTOR VIZCARA:
1) P50,000.00 as indemnity for the
death of Samuel Vizcara;
2) P200,000.00 as moral damages;
3) P100,000.00 as exemplary damages;
and
4) P20,000.00 for Attorney’s fees.
d) CRESENCIA NATIVIDAD:
1) P50,000.00 as indemnity for the
death of Crispin Natividad;
2) P200,000.00 as moral damages;
3) P100,000.00 as exemplary damages;
and
4) P20,000.00 for Attorney’s fees.
e) JOEL VIZCARA
1) P9,870.00 as reimbursement for his
actual expenses;
2) P50,000.00 as moral damages;
3) P25,000.00 as exemplary damages;
and
4) P10,000.00 for Attorney’s fees.
f) DOMINADOR ANTONIO
1) P63,427.00 as reimbursement for his
actual expenses;
2) P50,000.00 as moral damages;
3) P25,000.00 as exemplary damages;
and
4) P10,000.00 for Attorney’s fees.
and
2. Costs of suit.
SO ORDERED.9
The Ruling of the CA
Unyielding, the petitioners appealed the RTC decision to the
CA. Subsequently, on July 21, 2009, the CA rendered the
assailed decision, affirming the RTC decision with
modification with respect to the amount of damages awarded
to the respondents. The CA disposed, thus:
WHEREFORE, instant appeal is PARTIALLY GRANTED.
The assailed Decision is AFFIRMED WITH MODIFICATION,
as follows:
(1) The award of P5,000.00 for re-embalming
expenses and P40,000.00 for wake/interment
expenses to PURIFICACION VIZCARA is deleted. In
lieu thereof, P25,000.00 as temperate damages is
awarded;
(2) The award of moral damages to PURIFICACION
VIZCARA, MARIVIC VIZCARA, HECTOR VIZCARA
 and CRESENCIA NATIVIDAD is hereby reduced from
P200,000.00 to P100,000.00 each while moral
damages awarded to JOEL VIZCARA and
DOMINADOR ANTONIO are likewise reduced from
P50,000.00 to P25,000.00;
(3) The award of exemplary damages to
PURIFICACION VIZCARA, MARIVIC VIZCARA,
HECTOR VIZCARA and CRESENCIA NATIVIDAD is
hereby reduced from P100,000.00 to P50,000.00
each while exemplary damages awarded to JOEL
VIZCARA and DOMINADOR ANTONIO are likewise
reduced from P25,000.00 to P12,500.00; and
(4) The award for attorney’s fees in favor of the
Appellees as well as the award of P300,000.00 to
Appellee PURIFICACION as reimbursement for the
value of the jeepney is DELETED.
SO ORDERED.10
In the assailed decision, the CA affirmed the RTC’s finding of
negligence on the part of the petitioners. It concurred with
the trial court's conclusion that petitioner PNR's failure to
install sufficient safety devices in the area, such as flagbars
or safety railroad bars and signage, was the proximate
cause of the accident. Nonetheless, in order to conform with
established jurisprudence, it modified the monetary awards
to the victims and the heirs of those who perished due to the
collision.
The petitioners filed a Motion for Reconsideration11 of the
decision of the CA. However, in a Resolution12 dated
October 26, 2009, the CA denied the same.
Aggrieved, the petitioners filed the present petition for review
on certiorari, raising the following grounds:
I crossing bar, warning light or sound, or flagman in the
THE CA ERRED IN FINDING THAT THE
PROXIMATE CAUSE OF THE ACCIDENT WAS THE
NEGLIGENCE OF THE PETITIONERS;
II
THE CA ERRED IN HOLDING THAT THE
DOCTRINE OF LAST CLEAR CHANCE FINDS NO
APPLICATION IN THE INSTANT CASE;
III
THE CA ERRED IN FINDING NEGLIGENCE ON
THE PART OF THE PETITIONERS OR ERRED IN
NOT FINDING AT THE LEAST, CONTRIBUTORY
NEGLIGENCE ON THE PART OF THE
RESPONDENTS.13
The petitioners maintain that the proximate cause of the
collision was the negligence and recklessness of the driver
of the jeepney. They argue that as a professional driver,
Reynaldo is presumed to be familiar with traffic rules and
regulations, including the right of way accorded to trains at
railroad crossing and the precautionary measures to observe
in traversing the same. However, in utter disregard of the
right of way enjoyed by PNR trains, he failed to bring his
jeepney to a full stop before crossing the railroad track and
thoughtlessly followed the ten-wheeler truck ahead of them.
His failure to maintain a safe distance between the jeepney
he was driving and the truck ahead of the same prevented
him from seeing the PNR signage displayed along the
crossing.14
In their Comment,15 the respondents reiterate the findings of
the RTC and the CA that the petitioners' negligence in
maintaining adequate and necessary public safety devices in
the area of the accident was the proximate cause of the
mishap. They asseverate that if there was only a level
intersection, the accident would not have happened. Thus,
there is no other party to blame but the petitioners for their
failure to ensure that adequate warning devices are installed
along the railroad crossing.16
This Court’s Ruling
The petition lacks merit.
The petitioners’ negligence was the proximate cause of the
accident.
Article 2176 of the New Civil Code prescribes a civil liability
for damages caused by a person's act or omission
constituting fault or negligence. It states:
Article 2176. Whoever by act or omission causes damage to
another, there being fault or negligence, is obliged to pay for
the damage done. Such fault or negligence, if there was no
pre-existing contractual relation between the parties, is
called quasi-delict and is governed by the provisions of this
chapter.
In Layugan v. Intermediate Appellate Court,17 negligence
was defined as the omission to do something which a
reasonable man, guided by considerations which ordinarily
regulate the conduct of human affairs, would do, or the doing
of something which a prudent and reasonable man would
not do. It is the failure to observe for the protection of the
interests of another person, that degree of care, precaution,
and vigilance which the circumstances justly demand,
whereby such other person suffers injury.18 To determine
the existence of negligence, the time-honored test was: Did
the defendant in doing the alleged negligent act use that
reasonable care and caution which an ordinarily prudent
person would have used in the same situation? If not, then
he is guilty of negligence. The law here in effect adopts the
standard supposed to be supplied by the imaginary conduct
of the discreet paterfamilias of the Roman law. The
existence of negligence in a given case is not determined by
reference to the personal judgment of the actor in the
situation before him. The law considers what would be
reckless, blameworthy, or negligent in the man of ordinary
intelligence and prudence and determines liability by that.19
In the instant petition, this Court is called upon to determine
whose negligence occasioned the ill-fated incident. The
records however reveal that this issue had been rigorously
discussed by both the RTC and the CA. To emphasize, the
RTC ruled that it was the petitioners’ failure to install
adequate safety devices at the railroad crossing which
proximately caused the collision. This finding was affirmed
by the CA in its July 21, 2009 Decision. It is a well-
established rule that factual findings by the CA are
conclusive on the parties and are not reviewable by this
Court. They are entitled to great weight and respect, even
finality, especially when, as in this case, the CA affirmed the
factual findings arrived at by the trial court.20
Furthermore, in petitions for review on certiorari, only
questions of law may be put into issue. Questions of fact
cannot be entertained.21 To distinguish one from the other,
a question of lawexists when the doubt or difference centers
on what the law is on a certain state of facts. A question of
fact, on the other hand,exists if the doubt centers on the truth
or falsity of the alleged facts.22 Certainly, the finding of
negligence by the RTC, which was affirmed by the CA, is a
question of fact which this Court cannot pass upon as this
would entail going into the factual matters on which the
negligence was based.23 Moreover, it was not shown that
the present case falls under any of the recognized
exceptions24 to the oft repeated principle according great
weight and respect to the factual findings of the trial court
and the CA.
At any rate, the records bear out that the factual
circumstances of the case were meticulously scrutinized by
both the RTC and the CA before arriving at the same finding
of negligence on the part of the petitioners, and we found no
compelling reason to disturb the same. Both courts ruled that
the petitioners fell short of the diligence expected of it, taking
into consideration the nature of its business, to forestall any
untoward incident. In particular, the petitioners failed to
install safety railroad bars to prevent motorists from crossing
the tracks in order to give way to an approaching train. Aside
from the absence of a crossing bar, the "Stop, Look and
Listen" signage installed in the area was poorly maintained,
hence, inadequate to alert the public of the impending
danger. A reliable signaling device in good condition, not just
a dilapidated "Stop, Look and Listen" signage, is needed to
give notice to the public. It is the responsibility of the railroad
company to use reasonable care to keep the signal devices
in working order. Failure to do so would be an indication of
negligence.25 Having established the fact of negligence on
the part of the petitioners, they were rightfully held liable for
damages.
There was no contributory negligence on the part of the
respondents.
As to whether there was contributory negligence on the part
of the respondents, this court rule in the negative.
Contributory negligence is conduct on the part of the injured
party, contributing as a legal cause to the harm he has
suffered, which falls below the standard which he is required
to conform for his own protection. It is an act or omission
amounting to want of ordinary care on the part of the person
injured which, concurring with the defendant’s negligence, is
the proximate cause of the injury.26 Here, we cannot see
how the respondents could have contributed to their injury
when they were not even aware of the forthcoming danger. It
was established during the trial that the jeepney carrying the
respondents was following a ten-wheeler truck which was
only about three to five meters ahead. When the truck
proceeded to traverse the railroad track, Reynaldo, the driver
of the jeepney, simply followed through. He did so under the
impression that it was safe to proceed. It bears noting that
the prevailing circumstances immediately before the collision
did not manifest even the slightest indication of an imminent
harm. To begin with, the truck they were trailing was able to
safely cross the track. Likewise, there was no crossing bar to
prevent them from proceeding or, at least, a stoplight or
signage to forewarn them of the approaching peril. Thus,
relying on his faculties of sight and hearing, Reynaldo had
no reason to anticipate the impending danger.27 He
proceeded to cross the track and, all of a sudden, his
jeepney was rammed by the train being operated by the
petitioners. Even then, the circumstances before the collision
negate the imputation of contributory negligence on the part
of the respondents. What clearly appears is that the accident
would not have happened had the petitioners installed
reliable and adequate safety devices along the crossing to
ensure the safety of all those who may utilize the same.
At this age of modern transportation, it behooves the PNR to
exert serious efforts to catch up with the trend, including the
contemporary standards in railroad safety. As an institution
established to alleviate public transportation, it is the duty of
the PNR to promote the safety and security of the general
riding public and provide for their convenience, which to a
considerable degree may be accomplished by the
installation of precautionary warning devices. Every railroad
crossing must be installed with barriers on each side of the
track to block the full width of the road until after the train
runs past the crossing. To even draw closer attention, the
railroad crossing may be equipped with a device which rings
a bell or turns on a signal light to signify the danger or risk of
crossing. It is similarly beneficial to mount advance warning
signs at the railroad crossing, such as a reflectorized
crossbuck sign to inform motorists of the existence of the
track, and a stop, look and listen signage to prompt the
public to take caution. These warning signs must be erected
in a place where they will have ample lighting and
unobstructed visibility both day and night. If only these safety
devices were installed at the Tiaong railroad crossing and
the accident nevertheless occurred, we could have reached
a different disposition in the extent of the petitioner’s liability.
The exacting nature of the responsibility of railroad
companies to secure public safety by the installation of
warning devices was emphasized in Philippine National
Railways v. Court of Appeals,28 thus:
[I]t may broadly be stated that railroad companies owe to the
public a duty of exercising a reasonable degree of care to
avoid injury to persons and property at railroad crossings,
which duties pertain both to the operation of trains and to the
maintenance of the crossings. Moreover, every corporation
constructing or operating a railway shall make and construct
at all points where such railway crosses any public road,
good, sufficient, and safe crossings, and erect at such
points, at sufficient elevation from such road as to admit a
free passage of vehicles of every kind, a sign with large and
distinct letters placed thereon, to give notice of the proximity
of the railway, and warn persons of the necessity of looking
out for trains. The failure of the PNR to put a cross bar, or
signal light, flagman or switchman, or semaphore is
evidence of negligence and disregard of the safety of the
public, even if there is no law or ordinance requiring it,
because public safety demands that said device or
equipment be installed.29
The responsibility of the PNR to secure public safety does
not end with the installation of safety equipment and
signages but, with equal measure of accountability, with the
upkeep and repair of the same. Thus, in Cusi v. Philippine
National Railways,30 we held:
Jurisprudence recognizes that if warning devices are
installed in railroad crossings, the travelling public has the
right to rely on such warning devices to put them on their
guard and take the necessary precautions before crossing
the tracks. A need, therefore, exists for the railroad company
to use reasonable care to keep such devices in good
condition and in working order, or to give notice that they are
not operating, since if such a signal is misunderstood it is a
menace. Thus, it has been held that if a railroad company
maintains a signalling device at a crossing to give warning of
the approach of a train, the failure of the device to operate is
generally held to be evidence of negligence, which maybe
considered with all the circumstances of the case in
determining whether the railroad company was negligent as
a matter of fact.31
The maintenance of safety equipment and warning signals at
railroad crossings is equally important as their installation
since poorly maintained safety warning devices court as
much danger as when none was installed at all. The
presence of safety warning signals at railroad crossing
carries with it the presumption that they are in good working
condition and that the public may depend on them for
assistance. If they happen to be neglected and inoperative,
the public may be misled into relying on the impression of
safety they normally convey and eventually bring injury to
themselves in doing so.
The doctrine of last clear chance is not applicable.
Finally, the CA correctly ruled that the doctrine of last clear
chance is not applicable in the instant case. The doctrine of
last clear chance provides that where both parties are
negligent but the negligent act of one is appreciably later in
point of time than that of the other, or where it is impossible
to determine whose fault or negligence brought about the
occurrence of the incident, the one who had the last clear
opportunity to avoid the impending harm but failed to do so,
is chargeable with the consequences arising therefrom.
Stated differently, the rule is that the antecedent negligence
of a person does not preclude recovery of damages caused
by the supervening negligence of the latter, who had the last
fair chance to prevent the impending harm by the exercise of
due diligence.32 To reiterate, the proximate cause of the
collision was the petitioners’ negligence in ensuring that
motorists and pedestrians alike may safely cross the railroad
track. The unsuspecting driver and passengers of the
jeepney did not have any participation in the occurrence of
the unfortunate incident which befell them. Likewise, they did
not exhibit any overt act manifesting disregard for their own
safety. Thus, absent preceding negligence on the part of the
respondents, the doctrine of last clear chance cannot be
applied.
WHEREFORE, premises considered, the petition is
DENIED. The Decision of the Court of Appeals dated July
21, 2009 in CA-G.R. CV No. 90021 is hereby AFFIRMED.
SO ORDERED.
[ G.R. No. 12219, March 15, 1918 ]
AMADO PICART, PLAINTIFF AND APPELLANT, VS.
FRANK SMITH, JR., DEFENDANT AND APPELLEE.
DECISION
STREET, J.:
In this action the plaintiff, Amado Picart, seeks to recover of
the defendant, Frank Smith, jr., the sum of P31,100, as
damages alleged to have been caused by an automobile
driven by the defendant. From a judgment of the Court of
First Instance of the Province of La Union absolving the
defendant from liability the plaintiff has appealed.
The occurrence which gave rise to the institution of this
action took place on December 12, 1912, on the Carlatan
Bridge, at San Fernando, La Union. It appears that upon the
occasion in question the plaintiff was riding on his pony over
said bridge. Before he had gotten half way across, the
defendant approached from the opposite direction in an
automobile, going at the rate of about ten or twelve miles,
per hour. As the defendant neared the bridge he saw a
horseman on it and blew his horn to give warning of his
approach. He continued his course and after he had taken
the bridge he gave two more successive blasts, as it
appeared to him that the man on horseback before him was
not observing the rule of the road.
The plaintiff, it appears, saw the automobile coming and
heard the warning signals. However, being perturbed by the
novelty of the apparition or the rapidity of the approach, he
pulled the pony closely up against the railing on the right
side of the bridge instead of going to the left. He says that
the reason he did this was that he thought he did not have
sufficient time to get over to the other side. The bridge is
shown to have a length of about 75 meters and a width of
4.80 meters. As the automobile approached, the defendant
guided it toward his left, that being the proper side of the
road for the machine. In so doing the defendant assumed
that the horseman would move to the other side. The pony
had not as yet exhibited fright, and the rider had made no
sign for the automobile to stop. Seeing that the pony was
apparently quiet, the defendant, instead of veering to the
right while yet some distance away or slowing down,
continued to approach directly toward the horse without
diminution of speed. When he had gotten quite near, there
being then no possibility of the horse getting across to the
other side, the defendant quickly turned his car sufficiently to
the right to escape hitting the horse alongside of the railing
where it was then standing; but in so doing the automobile
passed in such close proximity to the animal that it became
frightened and turned its body across the bridge with its
head toward the railing. In so doing, it was struck on the
hock of the left hind leg by the flange of the car and the limb
was broken. The horse fell and its rider was thrown off with
some violence. From the evidence adduced in the case we
believe that when the accident occurred the free space
where the pony stood between the automobile and the
railing of the bridge was probably less than one and one half
meters. As a result of its injuries the horse died. The plaintiff
received contusions which caused temporary
unconsciousness and required medical attention for several
days.
The question presented for decision is whether or not the
defendant in maneuvering his car in the manner above
described was guilty of negligence such as gives rise to a
civil obligation to repair the damage done; and we are of the
opinion that he is so liable. As the defendant started across
the bridge, he had the right to assume that the horse and
rider would pass over to the proper side; but as he moved
toward the center of the bridge it was demonstrated to his
eyes that this would not be done; and he must in a moment
have perceived that it was too late for the horse to cross with
safety in front of the moving vehicle. In the nature of things
this change of situation occurred while the automobile was
yet some distance away; and from this moment it was not
longer within the power of the plaintiff to escape being run
down by going to a place of greater safety. The control of the
situation had then passed entirely to the defendant; and it
was his duty either to bring his car to an immediate stop or,
seeing that there were no other persons on the bridge, to
take the other side and pass sufficiently far away from the
horse to avoid the danger of collision. Instead of doing this,
the defendant ran straight on until he was almost upon the
horse. He was, we think, deceived into doing this by the fact
that the horse had not yet exhibited fright. But in view of the
known nature of horses, there was an appreciable risk that, if
the animal in question was unacquainted with automobiles,
he might get excited and jump under the conditions which
here confronted him. When the defendant exposed the horse
and rider to this danger he was, in our opinion, negligent in
the eye of the law.
The test by which to determine the existence of negligence
in a particular case may be stated as follows: Did the
defendant in doing the alleged negligent act use that
reasonable care and caution which an ordinarily prudent
person would have used in the same situation ? If not, then
he is guilty of negligence. The law here in effect adopts the
standard suppose to be supplied by the imaginary conduct of
the discreet paterfamilias of the Roman law. The existence
of negligence in a given case is not determined by reference
to the personal judgment of the actor in the situation before
him. The law considers what would be reckless,
blameworthy, or negligent in the man of ordinary intelligence
and prudence and determines liability by that.
The question as to what would constitute the conduct of a
prudent man in a given situation must of course be always
determined in the light of human experience and in view of
the facts involved in the particular case. Abstract speculation
cannot here be of much value but this much can be
profitably said: Reasonable men govern their conduct by the
circumstances which are before them or known to them.
They are not, and are not supposed to be, omniscient of the
future. Hence they can be expected to take care only when
there is something before them to suggest or warn of
danger. Could a prudent man, in the case under
consideration, foresee harm as a result of the course
actually pursued? If so, it was the duty of the actor to take
precautions to guard against that harm. Reasonable
foresight of harm, followed by the ignoring of the suggestion
born of this prevision, is always necessary before negligence
can be held to exist. Stated in these terms, the proper
criterion for determining the existence of negligence in a
given case is this: Conduct is said to be negligent when a
prudent man in the position of the tortfeasor would have
foreseen that an effect harmful to another was sufficiently
probable to warrant his foregoing the conduct or guarding
against its consequences.
Applying this test to the conduct of the defendant in the
present case we think that negligence is clearly established.
A prudent man, placed in the position of the defendant,
would, in our opinion, have recognized that the course which
he was pursuing was fraught with risk, and would therefore
have foreseen harm to the horse and rider as a reasonable
consequence of that course. Under these circumstances the
law imposed on the defendant the duty to guard against the
threatened harm.
It goes without saying that the plaintiff himself was not free
from fault, for he was guilty of antecedent negligence in
planting himself on the wrong side of the road. But as we
have already stated, the defendant was also negligent; and
in such case the problem always is to discover which agent
is immediately and directly responsible. It will be noted that
the negligent acts of the two parties were not
contemporaneous, since the negligence of the defendant
succeeded the negligence of the plaintiff by an appreciable
interval. Under these circumstances the law is that the
person who has the last fair chance to avoid the impending
harm and fails to do so is chargeable with the
consequences, without reference to the prior negligence of
the other party.
The decision in the case of Rakes vs. Atlantic, Gulf and
Pacific Co. (7 Phil. Rep., 359) should perhaps be mentioned
in this connection. This Court there held that while
contributory negligence on the part of the person injured did
not constitute a bar to recovery, it could be received in
evidence to reduce the damages which would otherwise
have been assessed wholly against the other party. The
defendant company had there employed the plaintiff, a
laborer, to assist in transporting iron rails from a barge in
Manila harbor to the company's yards located not far away.
The rails were conveyed upon cars which were hauled along
a narrow track. At a certain spot near the water's edge the
track gave way by reason of the combined effect of the
weight of the car and the insecurity of the road bed. The car
was in consequence upset; the rails slid off; and the
plaintiff's leg was caught and broken. It appeared in
evidence that the accident was due to the effects of a
typhoon which had dislodged one of the supports of the
track. The court found that the defendant company was
negligent in having failed to repair the bed of the track and
also that the plaintiff was, at the moment of the accident,
guilty of contributory negligence in walking at the side of the
car instead of being in front or behind. It was held that while
the defendant was liable to the plaintiff by reason of its
negligence in having failed to keep the track in proper repair,
nevertheless the amount of the damages should be reduced
on account of the contributory negligence of the plaintiff. As
will be seen the defendant's negligence in that case
consisted in an omission only. The liability of the company
arose from its responsibility for the dangerous condition of its
track. In a case like the one now before us, where the
defendant was actually present and operating the
automobile which caused the damage, we do not feel
constrained to attempt to weigh the negligence of the
respective parties in order to apportion the damage
according to the degree of their, relative fault. It is enough to
say that the negligence of the defendant was in this case the
immediate and determining cause of the accident and that
the antecedent negligence of the plaintiff was a more remote
factor in the case.
A point of minor importance in the case is indicated in the
special defense pleaded in the defendant's answer, to the
effect that the subject matter of the action had been
previously adjudicated in the court of a justice of the peace.
In this connection it appears that soon after the accident in
question occurred, the plaintiff caused criminal proceedings
to be instituted before a justice of the peace charging the
defendant with the infliction of serious injuries (lesiones
graves). At the preliminary investigation the defendant was
discharged by the magistrate and the proceedings were
dismissed. Conceding that the acquittal of the defendant at a
trial upon the merits in a criminal prosecution for the offense
mentioned would be res adjudicata, upon the question of his
civil liability arising from negligence—a point upon which it is
unnecessary to express an opinion—the action of the justice
of the peace in dismissing the criminal proceeding upon the
preliminary hearing can have no such effect. (See U. S. vs.
Banzuela and Banzuela, 31 Phil. Rep., 564.)
From what has been said it results that the judgment of the
lower court must be reversed, and judgment is here
rendered that the plaintiff recover of the defendant the sum
of two hundred pesos (P200), with costs of both instances.
The sum here awarded is estimated to include the value of
the horse, medical expenses of the plaintiff, the loss or
damage occasioned to articles of his apparel, and lawful
interest on the whole to the date of this recovery. The other
damages claimed by the plaintiff are remote or otherwise of
such character as not to be recoverable. So ordered.
Arellano, C. J., Torres, Carson, Araullo, Avanceña,
and Fisher, JJ., concur.
Johnson, J., reserves his vote.
CONCURRING OPINION
MALCOLM, J., concurring:
After mature deliberation, I have finally decided to concur
with the judgment in this case. I do so because of my
understanding of the "last clear chance" rule of the law of
negligence as particularly applied to automobile accidents.
This rule cannot be invoked where the negligence of the
plaintiff is "concurrent with that of the defendant. Again, if a
traveller when he reaches the point of collision is in a
situation to extricate himself and avoid injury, his negligence
at that point will prevent a recovery. But Justice Street finds
as a fact that the negligent act of the defendant succeeded
that of the plaintiff by an appreciable interval of time, and
that at that moment the plaintiff had no opportunity to avoid
the accident. Consequently, the "last clear chance" rule is
applicable. In other words, when a traveller has reached a
point where he cannot extricate himself and vigilance on his
part will not avert the injury, his negligence in reaching that
position becomes the condition and not the proximate cause
of the injury and will not preclude a recovery. (Note
especially Aiken vs. Metcalf [1917], 102 Atl, 330.)
[ G.R. Nos. 79050-51, November 14, 1989 ]
PANTRANCO NORTH EXPRESS, INC., PETITIONER, VS.
MARICAR BASCOS BAESA, THRU HER PERSONAL
GUARDIAN FRANCISCA O. BASCOS, FE O. ICO, IN HER
BEHALF AND IN BEHALF OF HER MINOR CHILDREN,
NAMELY ERWIN, OLIVE, EDMUNDO AND SHARON ICO,
RESPONDENTS.
DECISION
CORTES, J.:
In this Petition, Pantranco North Express Inc.
(PANTRANCO) asks the Court to review the decision of the
Court of Appeals in CA-G.R. CV No. 05494-95 which
affirmed the decisions of the then Court of First Instance of
Rosales, Pangasinan in Civil Case No. 561-R and Civil Case
No. 589-R wherein PANTRANCO was ordered to pay
damages and attorney's fees to herein private respondents.
The pertinent facts are as follows:
At about 7:00 o'clock in the morning of June 12, 1981, the
spouses Ceasar and Marilyn Baesa and their children Harold
Jim, Marcelino and Maricar, together with spouses David Ico
and Fe O. Ico with their son Erwin Ico and seven other
persons, were aboard a passenger jeepney on their way to a
picnic at Malalam River, Ilagan, Isabela, to celebrate the fifth
wedding anniversary of Ceasar and Marilyn Baesa.
The group, numbering fifteen (15) persons, rode in the
passenger jeepney driven by David Ico, who was also the
registered owner thereof. From Ilagan, Isabela, they
proceeded to Barrio Capayacan to deliver some viands to
one Mrs. Bascos and thenceforth to San Felipe, taking the
highway going to Malalam River. Upon reaching the
highway, the jeepney turned right and proceeded to Malalam
River at a speed of about 20 kph. While they were
proceeding towards Malalam River, a speeding
PANTRANCO bus from Aparri, on its regular route to Manila,
encroached on the jeepney's lane while negotiating a curve,
and collided wit it.
As a result of the accident David Ico, spouses CeasarBaesa
and Marilyn Baesa and their children, Harold Jim and
MarcelinoBaesa, died while the rest of the passengers
suffered injuries. The jeepney was extensively damaged.
After the accident the driver of the PANTRANCO Bus,
Ambrosio Ramirez, boarded a car and proceeded to
Santiago, Isabela. From that time on up to the present,
Ramirez has never been seen and has apparently remained
in hiding.
All the victims and/or their surviving heirs except herein
private respondents settled the case amicably under the "No
Fault" insurance coverage of PANTRANCO.
MaricarBaesa through her guardian Francisca O. Bascos
and Fe O. Ico for herself and for her minor children, filed
separate actions for damages arising from quasi-delict
against PANTRANCO, respectively docketed as Civil Case
No. 561-R and 589-R of the Court of First Instance of
Pangasinan.
In its answer, PANTRANCO, aside from pointing to the late
David Ico's alleged negligence as the proximate cause of the
accident, invoked the defense of due diligence in the
selection and supervision of its driver, Ambrosio Ramirez.
On July 3, 1984, the CFI of Pangasinan rendered a decision
against PANTRANCO awarding the total amount of Two
Million Three Hundred Four Thousand Six Hundred Forty-
Seven Pesos (P2,304,647.00) as damages, plus 10%
thereof as attorney's fees and costs to MaricarBaesa in Civil
Case No. 561-R, and the total amount of Six Hundred Fifty
Two Thousand Six Hundred Seventy-Two Pesos
(P652,672.00) as damages, plus 10% thereof as attorney’s
fees and costs to Fe Ico and her children in Civil Case No.
589-R. On appeal, the cases were consolidated and the
Court of Appeals modified the decision of the trial court by
ordering PANTRANCO to pay the total amount of One
Million One Hundred Eighty-Nine Thousand Nine Hundred
Twenty-Seven Pesos (P1,189,927.00) as damages, plus
Twenty Thousand Pesos (P20,000.00) as attorney's fees to
MaricarBaesa, and the total amount of Three Hundred Forty-
Four Thousand Pesos (P344,000.00) plus Ten Thousand
Pesos (P10,000.00) as attorney's fees to Fe Ico and her
children, and to pay the costs in both cases. The dispositive
portion of the assailed decision reads as follows:
WHEREFORE, the decision appealed from is hereby
modified by ordering the defendant PANTRANCO North
Express, Inc. to pay:
I. The plaintiff in Civil Case No. 561-R,
MaricarBascosBaesa, the following damages:
A) As compensatory damages for the death of
CeasarBaesa - P30,000.00;
B) As compensatory damages for the death of
Marilyn Baesa - P30,000.00;
C) As compensatory damages for the death of
Harold Jim Baesa and MarcelinoBaesa -
P30,000.00;
D) For the loss of earnings of CeasarBaesa -
P630,000.00;
E) For the loss of earnings of Marilyn
BascosBaesa - P375,000.00;
 F) For the burial expenses of the deceased
Ceasar and Marilyn Baesa - P 41,200.00
G) For hospitalization expenses of MaricarBaesa -
P3,727.00
H) As moral damages - P50,000.00;
I) As attorney's fees - P20,000.00.
II. The plaintiffs in Civil Case No. 589-R, the following
damages:
A) As compensatory damages for the death of David Ico -
P30,000.00;
B) For loss of earning capacity of David Ico - P252,000.00
C) As moral damages for the death of David Ico and the
injury of Fe Ico - P30,000.00;
D) As payment for the jeepney - P20,000.00;
E) For the hospitalization of Fe Ico - P12,000.00;
F) And for attorney's fees - P10,000.00;
and to pay the costs in both cases.
The amount of P25,000.00 paid to MaricarBascosBaesa,
plaintiff in Civil Case No. 561-R, and the medical expenses
in the sum of P3,273.55, should be deducted from the award
in her favor.
All the foregoing amounts herein awarded except the costs
shall earn interest at the legal rate from date of this decision
until fully paid. [CA Decision, pp. 14-15; Rollo, pp. 57-58.]
PANTRANCO filed a motion for reconsideration of the Court
of Appeal's decision, but on June 26, 1987, it denied the
same for lack of merit. PANTRANCO then filed the instant
petition for review.
I
Petitioner faults the Court of Appeals for not applying the
doctrine of the "last clear chance" against the jeepney driver.
Petitioner claims that under the circumstances of the case, it
was the driver of the passenger jeepney who had the last
clear chance to avoid the collision and was therefore
negligent in failing to utilize with reasonable care and
competence his then existing opportunity to avoid the harm.
The doctrine of the last clear chance was defined by this
Court in the case of Ongv.MetropolitanWaterDistrict, 104
Phil. 397 (1958), in this wise:
The doctrine of the last clear chance simply means that the
negligence of a claimant does not preclude a recovery for
the negligence of defendant where it appears that the latter,
by exercising reasonable care and prudence, might have
avoided injurious consequences to claimant notwithstanding
his negligence.
The doctrine applies only in a situation where the plaintiff
was guilty of prior or antecedent negligence but the
defendant, who had the last fair chance to avoid the
impending harm and failed to do so, is made liable for all the
consequences of the accident notwithstanding the prior
negligence of the plaintiff [Picart v. Smith, 37 Phil 809
(1918); Glan People's Lumber and Hardware, et al. v.
Intermediate Appellate Court, Cecilia AlferezVda. de Calibo,
et al., G.R. No. 70493, May 18, 1989.] The subsequent
negligence of the defendant in failing to exercise ordinary
care to avoid injury to plaintiff becomes the immediate or
proximate cause of the accident which intervenes between
the accident and the more remote negligence of the plaintiff,
thus making the defendant liable to the plaintiff [Picart v.
Smith, supra.]
Generally, the last clear chance doctrine is invoked for the
purpose of making a defendant liable to a plaintiff who was
guilty of prior or antecedent negligence, although it may also
be raised as a defense to defeat claim for damages.
To avoid liability for the negligence of its driver, petitioner
claims that the original negligence of its driver was not the
proximate cause of the accident and that the sole proximate
cause was the supervening negligence of the jeepney driver
David Ico in failing to avoid the accident. It is petitioner's
position that even assuming arguendo, that the bus
encroached into the lane of the jeepney, the driver of the
latter could have swerved the jeepney towards the spacious
dirt shoulder on his right without danger to himself or his
passengers.
The above contention of petitioner is manifestly devoid of
merit.
Contrary to the petitioner's contention, the doctrine of "last
clear chance" finds no application in this case. For the
doctrine to be applicable, it is necessary to show that the
person who allegedly had the last opportunity to avert the
accident was aware of the existence of the peril or should,
with exercise of due care, have been aware of it. One
cannot be expected to avoid an accident or injury if he does
not know or could not have known the existence of the peril.
In this case, there is nothing to show that the jeepney driver
David Ico knew of the impending danger. When he saw at a
distance that the approaching bus was encroaching on his
lane, he did not immediately swerve the jeepney to the dirt
shoulder on his right since he must have assumed that the
bus driver will return the bus to its own lane upon seeing the
jeepney approaching from the opposite direction. As held by
this Court in the case of Vda.DeBonifaciov.BLTB, G.R. No.
L-26810, August 31, 1970, 34 SCRA 618, a motorist who is
properly proceeding on his own side of the highway is
generally entitled to assume that an approaching vehicle
coming towards him on the wrong side, will return to his
proper lane of traffic. There was nothing to indicate to David
Ico that the bus could not return to its own lane or was
prevented from returning to the proper lane by anything
beyond the control of its driver. Leo Marantan, an alternate
driver of the Pantranco bus who was seated beside the
driver Ramirez at the time of the accident, testified that
Ramirez had no choice but to swerve the steering wheel to
the left and encroach on the jeepney's lane because there
was a steep precipice on the right [CA Decision, p. 2; Rollo,
p. 45.] However, this is belied by the evidence on record
which clearly shows that there was enough space to swerve
the bus back to its own lane without any danger [CA
Decision, p. 7; Rollo, p. 50.]
Moreover, both the trial court and the Court of Appeals found
that at the time of the accident the Pantranco bus was
speeding towards Manila [CA Decision, p. 2; Rollo, p. 45.] By
the time David Ico must have realized that the bus was not
returning to its own lane, it was already too late to swerve
the jeepney to his right to prevent an accident. The speed at
which the approaching bus was running prevented David Ico
from swerving the jeepney to the right shoulder of the road in
time to avoid the collision. Thus, even assuming that the
jeepney driver perceived the danger a few seconds before
the actual collision, he had no opportunity to avoid it. This
Court has held that the last clear chance doctrine "can never
apply where the party charged is required to act
instantaneously, and if the injury cannot be avoided by the
application of all means at hand after the peril is or should
have been discovered" [Ong v. Metropolitan Water District,
supra.]
Petitioner likewise insists that David Ico was negligent in
failing to observe Section 43 (c), Article III Chapter IV of
Republic Act No. 4136* which provides that the driver of a
vehicle entering a through highway or a stop intersection
shall yield the right of way to all vehicles approaching in
either direction on such through highway.
Petitioner's misplaced reliance on the aforesaid law is readily
apparent in this case. The cited law itself provides that it
applies only to vehicles entering a through highway or a stop
intersection. At the time of the accident, the jeepney had
already crossed the intersection and was on its way to
Malalam River. Petitioner itself cited Fe Ico's testimony that
the accident occurred after the jeepney had travelled a
distance of about two (2) meters from the point of
intersection [Petition p. 10; Rollo, p. 27.] In fact, even the
witness for the petitioner, Leo Marantan, testified that both
vehicles were coming from opposite directions [CA Decision,
p. 7; Rollo, p. 50], clearly indicating that the jeepney had
already crossed the intersection.
Considering the foregoing, the Court finds that the
negligence of petitioner's driver in encroaching into the lane
of the incoming jeepney and in failing to return the bus to its
own lane immediately upon seeing the jeepney coming from
the opposite direction was the sole and proximate cause of
the accident without which the collision would not have
occurred. There was no supervening or intervening
negligence on the part of the jeepney driver which would
have made the prior negligence of petitioner's driver a mere
remote cause of the accident.
II
On the issue of its liability as an employer, petitioner claims
that it had observed the diligence of a good father of a family
to prevent damage, conformably to the last paragraph of
Article 2180 of the Civil Code. Petitioner adduced evidence
to show that in hiring its drivers, the latter are required to
have professional driver's license and police clearance. The
drivers must also pass written examinations, interviews and
practical driving tests, and are required to undergo a six-
month training period. Rodrigo San Pedro, petitioner's
Training Coordinator, testified on petitioner's policy of
conducting regular and continuing training programs and
safety seminars for its drivers, conductors, inspectors and
supervisors at a frequency rate of at least two (2) seminars a
month.
On this point, the Court quotes with approval the following
findings of the trial court which was adopted by the Court of
Appeals in its challenged decision:
When an injury is caused by the negligence of an employee,
there instantly arises a presumption that the employer has
been negligent either in the selection of his employees or in
the supervision over their acts. Although this presumption is
only a disputable presumption which could be overcome by
proof of diligence of a good father of a family, this Court
believes that the evidence submitted by the defendant to
show that it exercised the diligence of a good father of a
family in the case of Ramirez, as a company driver is far
from sufficient. No support evidence has been adduced.
The professional driver's license of Ramirez has not been
produced. There is no proof that he is between 25 to 38
years old. There is also no proof as to his educational
attainment, his age, his weight and the fact that he is married
or not. Neither are the result of the written test,
psychological and physical test, among other tests, have
been submitted in evidence [sic]. His NBI or police
clearances and clearances from previous employment were
not marked in evidence. No evidence was presented that
Ramirez actually and really attended the seminars. Vital
evidence should have been the certificate of attendance or reason to disturb the finding of both the trial court and the
certificate of participation or evidence of such participation Court of Appeals that the evidence presented by the
like a logbook signed by the trainees when they attended the petitioner, which consists mainly of the uncorroborated
seminars. If such records are not available, the testimony of testimony of its Training Coordinator, is insufficient to
the classmates that Ramirez was their classmate in said overcome the presumption of negligence against petitioner.
seminar (should have been presented) [CA Decision, pp. 8-
III
9; Rollo, pp. 51-52.]
On the question of damages, petitioner claims that the Court
Petitioner contends that the fact that Ambrosio Ramirez was
of Appeals erred in fixing the damages for the loss of earning
employed and remained as its driver only means that he
capacity of the deceased victims. Petitioner assails
underwent the same rigid selection process and was
respondent court's findings because no documentary
subjected to the same strict supervision imposed by
evidence in support thereof, such as income tax returns,
petitioner on all applicants and employees. It is argued by
pay-rolls, pay slips or invoices obtained in the usual course
the petitioner that unless proven otherwise, it is presumed
of business, were presented [Petition, p. 22; Rollo, p. 39.]
that petitioner observed its usual recruitment procedure and
Petitioner argues that the "bare and self?serving testimonies
company policies on safety and efficiency [Petition, p. 20;
of the wife of the deceased David Ico and the mother of the
Rollo, p. 37.]
deceased Marilyn Baesa ... have no probative value to
sustain in law the Court of Appeals' conclusion on the
The Court finds the above contention unmeritorious.
respective earnings of the deceased victims." [Petition, pp.
21-22; Rollo, pp. 38-39.] It is petitioner's contention that the
The finding of negligence on the part of its driver Ambrosio evidence presented by the private respondent does not meet
Ramirez gave rise to the presumption of negligence on the the requirements of clear and satisfactory evidence to prove
part of petitioner and the burden of proving that it exercised actual and compensatory damages.
due diligence not only in the selection of its employees but
also in adequately supervising their work rests with the
The Court finds that the Court of Appeals committed no
petitioner (Lilius v. Manila Railroad Company, 59 Phil. 758
reversible error in fixing the amount of damages for the loss
(1934), Umali v. Bacani, G.R. No. L-40570, June 30, 1976,
of earning capacity of the deceased victims. While it is true
69 SCRA 623.] Contrary to petitioner's claim, there is no
that private respondents should have presented
presumption that the usual recruitment procedures and
documentary evidence to support their claim for damages for
safety standards were observed. The mere issuance of
loss of earning capacity of the deceased victims, the
rules and regulations and the formulation of various
absence thereof does not necessarily bar the recovery of the
company policies on safety, without showing that they are
damages in question. The testimony of Fe Ico and
being complied with, are not sufficient to exempt petitioner
Francisca Bascos as to the earning capacity of David Ico
from liability arising from the negligence of its employee. It is
and the spouses Baesa, respectively, are sufficient to
incumbent upon petitioner to show that in recruiting and
establish a basis from which the court can make a fair and
employing the erring driver, the recruitment procedures and
reasonable estimate of the damages for the loss of earning
company policies on efficiency and safety were followed.
capacity of the three deceased victims. Moreover, in fixing
Petitioner failed to do this. Hence, the Court finds no cogent
the damages for loss of earning capacity of a deceased
victim, the court can consider the nature of his occupation,
his educational attainment and the state of his health at the
time of death.
In the instant case, David Ico was thirty eight (38) years old
at the time of his death in 1981 and was driving his own
passenger jeepney. The spouses Ceasar and Marilyn
Baesa were both thirty (30) years old at the time of their
death. CeasarBaesa was a commerce degree holder and
the proprietor of the Cauayan Press, printer of the Cauayan
Valley Newspaper and the Valley Times at Cauayan,
Isabela. Marilyn Baesa graduated as a nurse in 1976 and at
the time of her death, was the company nurse, personnel
manager, treasurer and cashier of the Ilagan Press at Ilagan,
Isabela. Respondent court duly considered these factors,
together with the uncontradicted testimonies of Fe Ico and
Francisca Bascos, in fixing the amount of damages for the
loss of earning capacity of David Ico and the spouses
Baesa.
However, it should be pointed out that the Court of Appeals
committed error in fixing the compensatory damages for the
death of Harold Jim Baesa and MarcelinoBaesa.
Respondent court awarded to plaintiff (private respondent)
MaricarBaesa Thirty Thousand Pesos (P30,000.00) as
"compensatory damages for the death of Harold Jim Baesa
and MarcelinoBaesa." [CA Decision, p.14; Rollo, 57.] In
other words, the Court of Appeals awarded only Fifteen
Thousand Pesos (P15,000.00) as indemnity for the death of
Harold Jim Baesa and another Fifteen Thousand Pesos
(P15,000.00) for the death of MarcelinoBaesa. This is
clearly erroneous. In the case of Peoplev.delaFuente, G.R.
Nos. 63251-52, December 29, 1983, 126 SCRA 518, the
indemnity for the death of a person was fixed by this Court at
Thirty Thousand Pesos (P30,000.00). Plaintiff MaricarBaesa
should therefore be awarded Sixty Thousand Pesos
(P60,000.00) as indemnity for the death of her brothers,
Harold Jim Baesa and MarcelinoBaesa or Thirty Thousand
Pesos (P30,000.00) for the death of each brother.
The other items of damages awarded by respondent court
which were not challenged by the petitioner are hereby
affirmed.
WHEREFORE, premises considered, the petition is
DENIED, and the decision of respondent Court of Appeals is
hereby AFFIRMED with the modification that the amount of
compensatory damages for the death of Harold Jim Baesa
and MarcelinoBaesa are increased to Thirty Thousand
Pesos (P30,000.00) each.
SO ORDERED.
G.R. No. L-21438 September 28, 1966
AIR FRANCE, petitioner,
vs.
RAFAEL CARRASCOSO and the HONORABLE COURT
OF APPEALS, respondents.
Lichauco, Picazo and Agcaoili for petitioner.
Bengzon Villegas and Zarraga for respondent R.
Carrascoso.
SANCHEZ, J.:
The Court of First Instance of Manila 1 sentenced petitioner
to pay respondent Rafael Carrascoso P25,000.00 by way of
moral damages; P10,000.00 as exemplary damages;
P393.20 representing the difference in fare between first
class and tourist class for the portion of the trip Bangkok-
Rome, these various amounts with interest at the legal rate,
from the date of the filing of the complaint until paid; plus
P3,000.00 for attorneys' fees; and the costs of suit.
On appeal,2 the Court of Appeals slightly reduced the
amount of refund on Carrascoso's plane ticket from P393.20
to P383.10, and voted to affirm the appealed decision "in all
other respects", with costs against petitioner.
The case is now before us for review on certiorari.
The facts declared by the Court of Appeals as " fully
supported by the evidence of record", are:
Plaintiff, a civil engineer, was a member of a group of
48 Filipino pilgrims that left Manila for Lourdes on
March 30, 1958.
On March 28, 1958, the defendant, Air France,
through its authorized agent, Philippine Air Lines, Inc.,
issued to plaintiff a "first class" round trip airplane
ticket from Manila to Rome. From Manila to Bangkok,
plaintiff travelled in "first class", but at Bangkok, the
Manager of the defendant airline forced plaintiff to
vacate the "first class" seat that he was occupying
because, in the words of the witness Ernesto G.
Cuento, there was a "white man", who, the Manager
alleged, had a "better right" to the seat. When asked
to vacate his "first class" seat, the plaintiff, as was to
be expected, refused, and told defendant's Manager
that his seat would be taken over his dead body; a
commotion ensued, and, according to said Ernesto G.
Cuento, "many of the Filipino passengers got nervous
in the tourist class; when they found out that Mr.
Carrascoso was having a hot discussion with the
white man [manager], they came all across to Mr.
Carrascoso and pacified Mr. Carrascoso to give his
seat to the white man" (Transcript, p. 12, Hearing of
May 26, 1959); and plaintiff reluctantly gave his "first
class" seat in the plane.3
1. The trust of the relief petitioner now seeks is that we
review "all the findings" 4 of respondent Court of Appeals.
Petitioner charges that respondent court failed to make
complete findings of fact on all the issues properly laid
before it. We are asked to consider facts favorable to
petitioner, and then, to overturn the appellate court's
decision.
Coming into focus is the constitutional mandate that "No
decision shall be rendered by any court of record without
expressing therein clearly and distinctly the facts and the law
on which it is based". 5 This is echoed in the statutory
demand that a judgment determining the merits of the case
shall state "clearly and distinctly the facts and the law on
which it is based"; 6 and that "Every decision of the Court of
Appeals shall contain complete findings of fact on all issues
properly raised before it". 7
A decision with absolutely nothing to support it is a nullity. It
is open to direct attack. 8 The law, however, solely insists
that a decision state the "essential ultimate facts" upon
which the court's conclusion is drawn. 9 A court of justice is
not hidebound to write in its decision every bit and piece of
evidence 10 presented by one party and the other upon the
issues raised. Neither is it to be burdened with the obligation
"to specify in the sentence the facts" which a party
"considered as proved". 11 This is but a part of the mental
process from which the Court draws the essential ultimate
facts. A decision is not to be so clogged with details such
that prolixity, if not confusion, may result. So long as the
decision of the Court of Appeals contains the necessary
facts to warrant its conclusions, it is no error for said court to
withhold therefrom "any specific finding of facts with respect
to the evidence for the defense". Because as this Court well
observed, "There is no law that so requires". 12 Indeed, "the
mere failure to specify (in the decision) the contentions of the
appellant and the reasons for refusing to believe them is not
sufficient to hold the same contrary to the requirements of
the provisions of law and the Constitution". It is in this setting
that in Manigque, it was held that the mere fact that the
findings "were based entirely on the evidence for the
prosecution without taking into consideration or even
mentioning the appellant's side in the controversy as shown
by his own testimony", would not vitiate the judgment. 13 If
the court did not recite in the decision the testimony of each
witness for, or each item of evidence presented by, the
defeated party, it does not mean that the court has
overlooked such testimony or such item of evidence. 14 At
any rate, the legal presumptions are that official duty has
been regularly performed, and that all the matters within an
issue in a case were laid before the court and passed upon
by it. 15
Findings of fact, which the Court of Appeals is required to
make, maybe defined as "the written statement of the
ultimate facts as found by the court ... and essential to
support the decision and judgment rendered thereon". 16
They consist of the court's "conclusions" with respect to the
determinative facts in issue". 17 A question of law, upon the
other hand, has been declared as "one which does not call
for an examination of the probative value of the evidence
presented by the parties." 18
2. By statute, "only questions of law may be raised" in an
appeal by certiorari from a judgment of the Court of Appeals.
19 That judgment is conclusive as to the facts. It is not
appropriately the business of this Court to alter the facts or
to review the questions of fact. 20
With these guideposts, we now face the problem of whether
the findings of fact of the Court of Appeals support its
judgment.
3. Was Carrascoso entitled to the first class seat he claims?
It is conceded in all quarters that on March 28, 1958 he paid
to and received from petitioner a first class ticket. But
petitioner asserts that said ticket did not represent the true
and complete intent and agreement of the parties; that said
respondent knew that he did not have confirmed
reservations for first class on any specific flight, although he
had tourist class protection; that, accordingly, the issuance
of a first class ticket was no guarantee that he would have a
first class ride, but that such would depend upon the
availability of first class seats.
These are matters which petitioner has thoroughly presented
and discussed in its brief before the Court of Appeals under
its third assignment of error, which reads: "The trial court
erred in finding that plaintiff had confirmed reservations for,
and a right to, first class seats on the "definite" segments of
his journey, particularly that from Saigon to Beirut". 21
And, the Court of Appeals disposed of this contention thus:
Defendant seems to capitalize on the argument that
the issuance of a first-class ticket was no guarantee
that the passenger to whom the same had been
issued, would be accommodated in the first-class
compartment, for as in the case of plaintiff he had yet
to make arrangements upon arrival at every station
for the necessary first-class reservation. We are not
impressed by such a reasoning. We cannot
understand how a reputable firm like defendant
airplane company could have the indiscretion to give
out tickets it never meant to honor at all. It received
the corresponding amount in payment of first-class
tickets and yet it allowed the passenger to be at the
mercy of its employees. It is more in keeping with the
ordinary course of business that the company should
know whether or riot the tickets it issues are to be
honored or not.22
Not that the Court of Appeals is alone. The trial court
similarly disposed of petitioner's contention, thus:
On the fact that plaintiff paid for, and was issued a "First
class" ticket, there can be no question. Apart from his
testimony, see plaintiff's Exhibits "A", "A-1", "B", "B-1," "B-2",
"C" and "C-1", and defendant's own witness, Rafael
Altonaga, confirmed plaintiff's testimony and testified as
follows:
Q. In these tickets there are marks "O.K." From what
you know, what does this OK mean?
A. That the space is confirmed.
Q. Confirmed for first class?
A. Yes, "first class". (Transcript, p. 169)
x xx x xx x xx
Defendant tried to prove by the testimony of its witnesses
Luis Zaldariaga and Rafael Altonaga that although plaintiff
paid for, and was issued a "first class" airplane ticket, the
ticket was subject to confirmation in Hongkong. The court
cannot give credit to the testimony of said witnesses. Oral
evidence cannot prevail over written evidence, and plaintiff's
Exhibits "A", "A-l", "B", "B-l", "C" and "C-1" belie the
testimony of said witnesses, and clearly show that the
plaintiff was issued, and paid for, a first class ticket without
any reservation whatever.
Furthermore, as hereinabove shown, defendant's own
witness Rafael Altonaga testified that the reservation for a
"first class" accommodation for the plaintiff was confirmed.
The court cannot believe that after such confirmation
defendant had a verbal understanding with plaintiff that the
"first class" ticket issued to him by defendant would be
subject to confirmation in Hongkong. 23
We have heretofore adverted to the fact that except for a
slight difference of a few pesos in the amount refunded on
Carrascoso's ticket, the decision of the Court of First
Instance was affirmed by the Court of Appeals in all other
respects. We hold the view that such a judgment of
affirmance has merged the judgment of the lower court. 24
Implicit in that affirmance is a determination by the Court of
Appeals that the proceeding in the Court of First Instance
was free from prejudicial error and "all questions raised by
the assignments of error and all questions that might have
been raised are to be regarded as finally adjudicated against
the appellant". So also, the judgment affirmed "must be
regarded as free from all error". 25 We reached this policy
construction because nothing in the decision of the Court of
Appeals on this point would suggest that its findings of fact
are in any way at war with those of the trial court. Nor was
said affirmance by the Court of Appeals upon a ground or
grounds different from those which were made the basis of
the conclusions of the trial court. 26
If, as petitioner underscores, a first-class-ticket holder is not
entitled to a first class seat, notwithstanding the fact that seat
availability in specific flights is therein confirmed, then an air
passenger is placed in the hollow of the hands of an airline.
What security then can a passenger have? It will always be
an easy matter for an airline aided by its employees, to strike
out the very stipulations in the ticket, and say that there was
a verbal agreement to the contrary. What if the passenger
had a schedule to fulfill? We have long learned that, as a
rule, a written document speaks a uniform language; that
spoken word could be notoriously unreliable. If only to
achieve stability in the relations between passenger and air
carrier, adherence to the ticket so issued is desirable. Such
is the case here. The lower courts refused to believe the oral
evidence intended to defeat the covenants in the ticket.
The foregoing are the considerations which point to the
conclusion that there are facts upon which the Court of
Appeals predicated the finding that respondent
Carrascosohad a first class ticket and was entitled to a first
class seat at Bangkok, which is a stopover in the Saigon to
Beirut leg of the flight. 27 We perceive no "welter of
distortions by the Court of Appeals of petitioner's statement
of its position", as charged by petitioner. 28 Nor do we
subscribe to petitioner's accusation that respondent
Carrascoso "surreptitiously took a first class seat to provoke
an issue". 29 And this because, as petitioner states,
Carrascoso went to see the Manager at his office in Bangkok
"to confirm my seat and because from Saigon I was told
again to see the Manager". 30 Why, then, was he allowed to
take a first class seat in the plane at Bangkok, if he had no
seat? Or, if another had a better right to the seat?
4. Petitioner assails respondent court's award of moral
damages. Petitioner's trenchant claim is that Carrascoso's
action is planted upon breach of contract; that to authorize
an award for moral damages there must be an averment of
fraud or bad faith;31 and that the decision of the Court of
Appeals fails to make a finding of bad faith. The pivotal
allegations in the complaint bearing on this issue are:
3. That ... plaintiff entered into a contract of air
carriage with the Philippine Air Lines for a valuable
consideration, the latter acting as general agents for
and in behalf of the defendant, under which said
contract, plaintiff was entitled to, as defendant agreed
to furnish plaintiff, First Class passage on defendant's
plane during the entire duration of plaintiff's tour of
Europe with Hongkong as starting point up to and
until plaintiff's return trip to Manila, ... .
4. That, during the first two legs of the trip from
Hongkong to Saigon and from Saigon to Bangkok,
defendant furnished to the plaintiff First Class
accommodation but only after protestations,
arguments and/or insistence were made by the
plaintiff with defendant's employees.
5. That finally, defendant failed to provide First Class
passage, but instead furnished plaintiff only Tourist
Class accommodations from Bangkok to Teheran
and/or Casablanca, ... the plaintiff has been
compelled by defendant's employees to leave the
First Class accommodation berths at Bangkok after
he was already seated.
6. That consequently, the plaintiff, desiring no
repetition of the inconvenience and embarrassments
brought by defendant's breach of contract was forced
to take a Pan American World Airways plane on his
return trip from Madrid to Manila.32
x xx x xx x xx
2. That likewise, as a result of defendant's failure to furnish
First Class accommodations aforesaid, plaintiff suffered
inconveniences, embarrassments, and humiliations, thereby
causing plaintiff mental anguish, serious anxiety, wounded
feelings, social humiliation, and the like injury, resulting in
moral damages in the amount of P30,000.00. 33
x xx x xx x xx
The foregoing, in our opinion, substantially aver: First, That
there was a contract to furnish plaintiff a first class passage
covering, amongst others, the Bangkok-Teheran leg;
Second, That said contract was breached when petitioner
failed to furnish first class transportation at Bangkok; and
Third, that there was bad faith when petitioner's employee
compelled Carrascoso to leave his first class
accommodation berth "after he was already, seated" and to
take a seat in the tourist class, by reason of which he
suffered inconvenience, embarrassments and humiliations,
thereby causing him mental anguish, serious anxiety,
wounded feelings and social humiliation, resulting in moral
damages. It is true that there is no specific mention of the
term bad faith in the complaint. But, the inference of bad
faith is there, it may be drawn from the facts and
circumstances set forth therein. 34 The contract was averred
to establish the relation between the parties. But the stress
of the action is put on wrongful expulsion.
Quite apart from the foregoing is that (a) right the start of the
trial, respondent's counsel placed petitioner on guard on
what Carrascoso intended to prove: That while sitting in the
plane in Bangkok, Carrascoso was ousted by petitioner's
manager who gave his seat to a white man; 35 and (b)
evidence of bad faith in the fulfillment of the contract was
presented without objection on the part of the petitioner. It is,
therefore, unnecessary to inquire as to whether or not there
is sufficient averment in the complaint to justify an award for
moral damages. Deficiency in the complaint, if any, was
cured by the evidence. An amendment thereof to conform to
the evidence is not even required. 36 On the question of bad
faith, the Court of Appeals declared:
That the plaintiff was forced out of his seat in the first
class compartment of the plane belonging to the
defendant Air France while at Bangkok, and was
transferred to the tourist class not only without his
consent but against his will, has been sufficiently
established by plaintiff in his testimony before the
court, corroborated by the corresponding entry made
by the purser of the plane in his notebook which
notation reads as follows:
"First-class passenger was forced to go to the
tourist class against his will, and that the
captain refused to intervene",
and by the testimony of an eye-witness, Ernesto G.
Cuento, who was a co-passenger. The captain of the
plane who was asked by the manager of defendant
company at Bangkok to intervene even refused to do
so. It is noteworthy that no one on behalf of defendant
ever contradicted or denied this evidence for the
plaintiff. It could have been easy for defendant to
present its manager at Bangkok to testify at the trial of
the case, or yet to secure his disposition; but
defendant did neither. 37
The Court of appeals further stated —
Neither is there evidence as to whether or not a prior
reservation was made by the white man. Hence, if the
employees of the defendant at Bangkok sold a first-
class ticket to him when all the seats had already
been taken, surely the plaintiff should not have been
picked out as the one to suffer the consequences and
to be subjected to the humiliation and indignity of
being ejected from his seat in the presence of others.
Instead of explaining to the white man the
improvidence committed by defendant's employees,
the manager adopted the more drastic step of ousting
the plaintiff who was then safely ensconsced in his
rightful seat. We are strengthened in our belief that
this probably was what happened there, by the
testimony of defendant's witness Rafael Altonaga
who, when asked to explain the meaning of the letters
"O.K." appearing on the tickets of plaintiff, said "that
the space is confirmed for first class. Likewise,
Zenaida Faustino, another witness for defendant, who
was the chief of the Reservation Office of defendant,
testified as follows:
"Q How does the person in the ticket-issuing
office know what reservation the passenger
has arranged with you?
A They call us up by phone and ask for the
confirmation." (t.s.n., p. 247, June 19, 1959)
In this connection, we quote with approval what the
trial Judge has said on this point:
Why did the, using the words of witness
Ernesto G. Cuento, "white man" have a "better
right" to the seat occupied by Mr. Carrascoso?
The record is silent. The defendant airline did
not prove "any better", nay, any right on the
 part of the "white man" to the "First class" seat
that the plaintiff was occupying and for which
he paid and was issued a corresponding "first
class" ticket.
If there was a justified reason for the action of
the defendant's Manager in Bangkok, the
defendant could have easily proven it by
having taken the testimony of the said
Manager by deposition, but defendant did not
do so; the presumption is that evidence willfully
suppressed would be adverse if produced
[Sec. 69, par (e), Rules of Court]; and, under
the circumstances, the Court is constrained to
find, as it does find, that the Manager of the
defendant airline in Bangkok not merely asked
but threatened the plaintiff to throw him out of
the plane if he did not give up his "first class"
seat because the said Manager wanted to
accommodate, using the words of the witness
Ernesto G. Cuento, the "white man".38
It is really correct to say that the Court of Appeals in
the quoted portion first transcribed did not use the
term "bad faith". But can it be doubted that the recital
of facts therein points to bad faith? The manager not
only prevented Carrascoso from enjoying his right to a
first class seat; worse, he imposed his arbitrary will;
he forcibly ejected him from his seat, made him suffer
the humiliation of having to go to the tourist class
compartment - just to give way to another passenger
whose right thereto has not been established.
Certainly, this is bad faith. Unless, of course, bad faith
has assumed a meaning different from what is
understood in law. For, "bad faith" contemplates a
"state of mind affirmatively operating with furtive
design or with some motive of self-interest or will or
for ulterior purpose." 39
And if the foregoing were not yet sufficient, there is
the express finding of bad faith in the judgment of the
Court of First Instance, thus:
The evidence shows that the defendant
violated its contract of transportation with
plaintiff in bad faith, with the aggravating
circumstances that defendant's Manager in
Bangkok went to the extent of threatening the
plaintiff in the presence of many passengers to
have him thrown out of the airplane to give the
"first class" seat that he was occupying to,
again using the words of the witness Ernesto
G. Cuento, a "white man" whom he
(defendant's Manager) wished to
accommodate, and the defendant has not
proven that this "white man" had any "better
right" to occupy the "first class" seat that the
plaintiff was occupying, duly paid for, and for
which the corresponding "first class" ticket was
issued by the defendant to him.40
5. The responsibility of an employer for the tortious act of its
employees need not be essayed. It is well settled in law. 41
For the willful malevolent act of petitioner's manager,
petitioner, his employer, must answer. Article 21 of the Civil
Code says:
ART. 21. Any person who willfully causes loss or
injury to another in a manner that is contrary to
morals, good customs or public policy shall
compensate the latter for the damage.
In parallel circumstances, we applied the foregoing legal
precept; and, we held that upon the provisions of Article
2219 (10), Civil Code, moral damages are recoverable. 42
6. A contract to transport passengers is quite different in kind
and degree from any other contractual relation. 43 And this,
because of the relation which an air-carrier sustains with the
public. Its business is mainly with the travelling public. It
invites people to avail of the comforts and advantages it
offers. The contract of air carriage, therefore, generates a
relation attended with a public duty. Neglect or malfeasance
of the carrier's employees, naturally, could give ground for
an action for damages.
Passengers do not contract merely for transportation. They
have a right to be treated by the carrier's employees with
kindness, respect, courtesy and due consideration. They are
entitled to be protected against personal misconduct,
injurious language, indignities and abuses from such
employees. So it is, that any rule or discourteous conduct on
the part of employees towards a passenger gives the latter
an action for damages against the carrier. 44
Thus, "Where a steamship company 45 had accepted a
passenger's check, it was a breach of contract and a tort,
giving a right of action for its agent in the presence of third
persons to falsely notify her that the check was worthless
and demand payment under threat of ejection, though the
language used was not insulting and she was not ejected." 46
And this, because, although the relation of passenger and
carrier is "contractual both in origin and nature" nevertheless
"the act that breaks the contract may be also a tort". 47 And
in another case, "Where a passenger on a railroad train,
when the conductor came to collect his fare tendered him
the cash fare to a point where the train was scheduled not to
stop, and told him that as soon as the train reached such
point he would pay the cash fare from that point to
destination, there was nothing in the conduct of the
passenger which justified the conductor in using insulting
language to him, as by calling him a lunatic," 48 and the
Supreme Court of South Carolina there held the carrier liable
for the mental suffering of said passenger.1awphîl.nèt
Petitioner's contract with Carrascoso is one attended with
public duty. The stress of Carrascoso's action as we have
said, is placed upon his wrongful expulsion. This is a
violation of public duty by the petitioner air carrier — a case
of quasi-delict. Damages are proper.
7. Petitioner draws our attention to respondent Carrascoso's
testimony, thus —
Q You mentioned about an attendant. Who is that
attendant and purser?
A When we left already — that was already in the trip
— I could not help it. So one of the flight attendants
approached me and requested from me my ticket and
I said, What for? and she said, "We will note that you
transferred to the tourist class". I said, "Nothing of that
kind. That is tantamount to accepting my transfer."
And I also said, "You are not going to note anything
there because I am protesting to this transfer".
Q Was she able to note it?
A No, because I did not give my ticket.
Q About that purser?
A Well, the seats there are so close that you feel
uncomfortable and you don't have enough leg room, I
stood up and I went to the pantry that was next to me
and the purser was there. He told me, "I have
recorded the incident in my notebook." He read it and
translated it to me — because it was recorded in
French — "First class passenger was forced to go to
the tourist class against his will, and that the captain
refused to intervene."
Mr. VALTE —
 I move to strike out the last part of the testimony of
the witness because the best evidence would be the
notes. Your Honor.
COURT —
I will allow that as part of his testimony. 49
Petitioner charges that the finding of the Court of Appeals
that the purser made an entry in his notebook reading "First
class passenger was forced to go to the tourist class against
his will, and that the captain refused to intervene" is
predicated upon evidence [Carrascoso's testimony above]
which is incompetent. We do not think so. The subject of
inquiry is not the entry, but the ouster incident. Testimony on
the entry does not come within the proscription of the best
evidence rule. Such testimony is admissible. 49a
Besides, from a reading of the transcript just quoted, when
the dialogue happened, the impact of the startling
occurrence was still fresh and continued to be felt. The
excitement had not as yet died down. Statements then, in
this environment, are admissible as part of the res gestae. 50
For, they grow "out of the nervous excitement and mental
and physical condition of the declarant". 51 The utterance of
the purser regarding his entry in the notebook was
spontaneous, and related to the circumstances of the ouster
incident. Its trustworthiness has been guaranteed. 52 It thus
escapes the operation of the hearsay rule. It forms part of
the res gestae.
At all events, the entry was made outside the Philippines.
And, by an employee of petitioner. It would have been an
easy matter for petitioner to have contradicted
Carrascoso'stestimony. If it were really true that no such
entry was made, the deposition of the purser could have
cleared up the matter.
We, therefore, hold that the transcribed testimony of
Carrascoso is admissible in evidence.
8. Exemplary damages are well awarded. The Civil Code
gives the court ample power to grant exemplary damages —
in contracts and quasi- contracts. The only condition is that
defendant should have "acted in a wanton, fraudulent,
reckless, oppressive, or malevolent manner." 53 The manner
of ejectment of respondent Carrascoso from his first class
seat fits into this legal precept. And this, in addition to moral
damages.54
9. The right to attorney's fees is fully established. The grant
of exemplary damages justifies a similar judgment for
attorneys' fees. The least that can be said is that the courts
below felt that it is but just and equitable that attorneys' fees
be given. 55 We do not intend to break faith with the tradition
that discretion well exercised — as it was here — should not
be disturbed.
10. Questioned as excessive are the amounts decreed by
both the trial court and the Court of Appeals, thus:
P25,000.00 as moral damages; P10,000.00, by way of
exemplary damages, and P3,000.00 as attorneys' fees. The
task of fixing these amounts is primarily with the trial court. 56
The Court of Appeals did not interfere with the same. The
dictates of good sense suggest that we give our imprimatur
thereto. Because, the facts and circumstances point to the
reasonableness thereof.57
On balance, we say that the judgment of the Court of
Appeals does not suffer from reversible error. We
accordingly vote to affirm the same. Costs against petitioner.
So ordered.
G.R. No. 164349 January 31, 2006
RADIO COMMUNICATIONS OF THE PHILIPPINES, INC.
(RCPI),Petitioner,
vs.
ALFONSO VERCHEZ, GRACE VERCHEZ-INFANTE,
MARDONIO INFANTE, ZENAIDA VERCHEZ-CATIBOG,
AND FORTUNATO CATIBOG, Respondents.
DECISION
CARPIO MORALES, J.:
On January 21, 1991, Editha Hebron Verchez (Editha) was
confined at the Sorsogon Provincial Hospital due to an
ailment. On even date, her daughter Grace Verchez-Infante
(Grace) immediately hied to the Sorsogon Branch of the
Radio Communications of the Philippines, Inc. (RCPI) whose
services she engaged to send a telegram to her sister
Zenaida Verchez-Catibog (Zenaida) who was residing at 18
Legal St., GSIS Village, Quezon City1 reading: "Send check
money Mommy hospital." For RCPI’s services, Grace paid
P10.502 for which she was issued a receipt.3
As three days after RCPI was engaged to send the telegram
to Zenaida no response was received from her, Grace sent a
letter to Zenaida, this time thru JRS Delivery Service,
reprimanding her for not sending any financial aid.
Immediately after she received Grace’s letter, Zenaida,
along with her husband Fortunato Catibog, left on January
26, 1991 for Sorsogon. On her arrival at Sorsogon, she
disclaimed having received any telegram.
In the meantime, Zenaida and her husband, together with
her mother Editha left for Quezon City on January 28, 1991
and brought Editha to the Veterans Memorial Hospital in
Quezon City where she was confined from January 30, 1991
to March 21, 1991.
The telegram was finally delivered to Zenaida 25 days later
or on February 15, 1991.4 On inquiry from RCPI why it took
that long to deliver it, a messenger of RCPI replied that he
had nothing to do with the delivery thereof as it was another
messenger who previously was assigned to deliver the same
but the address could not be located, hence, the telegram
was resent on February 2, 1991, and the second messenger
finally found the address on February 15, 1991.
Editha’s husband Alfonso Verchez (Verchez), by letter of
March 5, 1991,5 demanded an explanation from the manager
of the Service Quality Control Department of the RCPI, Mrs.
Lorna D. Fabian, who replied, by letter of March 13, 1991,6
as follows:
Our investigation on this matter disclosed that subject
telegram was duly processed in accordance with our
standard operating procedure. However, delivery was not
immediately effected due to the occurrence of circumstances
which were beyond the control and foresight of RCPI.
Among others, during the transmission process, the radio
link connecting the points of communication involved
encountered radio noise and interferences such that subject
telegram did not initially registered (sic) in the receiving
teleprinter machine.
Our internal message monitoring led to the discovery of the
above. Thus, a repeat transmission was made and
subsequent delivery was effected. (Underscoring supplied)
Verchez’s lawyer thereupon wrote RCPI’s manager Fabian,
by letter of July 23, 1991,7 requesting for a conference on a
specified date and time, but no representative of RCPI
showed up at said date and time.
On April 17, 1992, Editha died.
On September 8, 1993, Verchez, along with his daughters
Grace and Zenaida and their respective spouses, filed a
complaint against RCPI before the Regional Trial Court
(RTC) of Sorsogon for damages. In their complaint, the
plaintiffs alleged that, inter alia, the delay in delivering the
telegram contributed to the early demise of the late Editha to
their damage and prejudice,8 for which they prayed for the
award of moral and exemplary damages9 and attorney’s
fees.10
After its motion to dismiss the complaint for improper
venue11 was denied12 by Branch 5 of the RTC of Sorsogon,
RCPI filed its answer, alleging that except with respect to
Grace,13 the other plaintiffs had no privity of contract with it;
any delay in the sending of the telegram was due to force
majeure, "specifically, but not limited to, radio noise and
interferences which adversely affected the transmission
and/or reception of the telegraphic message";14 the clause in
the Telegram Transmission Form signed by Grace absolved
it from liability for any damage arising from the transmission
other than the refund of telegram tolls;15 it observed due
diligence in the selection and supervision of its employees;
and at all events, any cause of action had been barred by
laches.16
The trial court, observing that "although the delayed delivery
of the questioned telegram was not apparently the proximate
cause of the death of Editha," ruled out the presence of force
majeure. Respecting the clause in the telegram relied upon
by RCPI, the trial court held that it partakes of the nature of a
contract of adhesion.
Finding that the nature of RCPI’s business obligated it to
dispatch the telegram to the addressee at the earliest
possible time but that it did not in view of the negligence of
its employees to repair its radio transmitter and the
concomitant delay in delivering the telegram on time, the trial
court, upon the following provisions of the Civil Code, to wit:
Article 2176 – Whoever by act or omission causes damage
to another, there being at fault or negligence, is obliged to
pay for the damage done. Such fault or negligence if there is
no pre-existing contractual relation between the parties, is
called quasi-delict and is governed by the provisions of this
Chapter.
Article 1173 defines the fault of (sic) negligence of the
obligor as the "omission of the diligence which is required by
the nature of the obligation and corresponds with the
circumstances of the person, of the time, or the place."
In the instant case, the obligation of the defendant to deliver
the telegram to the addressee is of an urgent nature. Its
essence is the early delivery of the telegram to the
concerned person. Yet, due to the negligence of its
employees, the defendant failed to discharge of its obligation
on time making it liable for damages under Article 2176.
The negligence on the part of the employees gives rise to
the presumption of negligence on the part of the employer.17
(Underscoring supplied),
rendered judgment against RCPI. Accordingly, it disposed:
WHEREFORE, in the light of the foregoing premises,
judgment is hereby rendered in favor of the plaintiffs and
against the defendant, to wit:
Ordering the defendant to pay the plaintiffs the following
amount:
1. The amount of One Hundred Thousand
(P100,000.00) Pesos as moral damages;
2. The amount of Twenty Thousand (P20,000.00)
Pesos as attorney’s fees; and
3. To pay the costs.
SO ORDERED.18
On appeal, the Court of Appeals, by Decision of February
27, 2004,19 affirmed the trial court’s decision.
Hence, RCPI’s present petition for review on certiorari, it
raising the following questions: (1) "Is the award of moral
damages proper even if the trial court found that there was
no direct connection between the injury and the alleged
negligent acts?"20 and (2) "Are the stipulations in the
‘Telegram Transmission Form,’ in the nature "contracts of
adhesion" (sic)?21
RCPI insists that respondents failed to prove any causal
connection between its delay in transmitting the telegram
and Editha’s death.22
RCPI’s stand fails. It bears noting that its liability is anchored
on culpa contractual or breach of contract with regard to
Grace, and on tort with regard to her co-plaintiffs-herein-co-
respondents.
Article 1170 of the Civil Code provides:
Those who in the performance of their obligations are guilty
of fraud, negligence, or delay, and those who in any manner
contravene the tenor thereof, are liable for damages.
(Underscoring supplied)
Passing on this codal provision, this Court explained:
In culpa contractual x xx the mere proof of the existence of
the contract and the failure of its compliance justify, prima
facie, a corresponding right of relief. The law, recognizing
the obligatory force of contracts, will not permit a party to be
set free from liability for any kind of misperformance of the
contractual undertaking or a contravention of the tenor
thereof. A breach upon the contract confers upon the injured
party a valid cause for recovering that which may have been
lost or suffered. The remedy serves to preserve the interests
of the promissee that may include his "expectation
interest," which is his interest in having the benefit of his
bargain by being put in as good a position as he would have
been in had the contract been performed, or his "reliance
interest," which is his interest in being reimbursed for loss
caused by reliance on the contract by being put in as good a
position as he would have been in had the contract not been
made; or his "restitution interest," which is his interest in
having restored to him any benefit that he has conferred on
the other party. Indeed, agreements can accomplish little,
either for their makers or for society, unless they are made
the basis for action. The effect of every infraction is to create
a new duty, that is, to make recompense to the one who has
been injured by the failure of another to observe his
contractual obligation unless he can show extenuating
circumstances, like proof of his exercise of due diligencex
xx or of the attendance of fortuitous event, to excuse him
from his ensuing liability.23 (Emphasis and underscoring
supplied)
In the case at bar, RCPI bound itself to deliver the telegram
within the shortest possible time. It took 25 days, however,
for RCPI to deliver it.
RCPI invokes force majeure, specifically, the alleged radio
noise and interferences which adversely affected the
transmission and/or reception of the telegraphic message.
Additionally, its messenger claimed he could not locate the
address of Zenaida and it was only on the third attempt that
he was able to deliver the telegram.
For the defense of force majeure to prosper,
x xx it is necessary that one has committed no negligence or
misconduct that may have occasioned the loss. An act of
God cannot be invoked to protect a person who has failed to
take steps to forestall the possible adverse consequences of
such a loss. One’s negligence may have concurred with an
act of God in producing damage and injury to another;
nonetheless, showing that the immediate or proximate cause
of the damage or injury was a fortuitous event would not
exempt one from liability. When the effect is found to be
partly the result of a person’s participation – whether by
active intervention, neglect or failure to act – the whole
occurrence is humanized and removed from the rules
applicable to acts of God.
x xxx
Article 1174 of the Civil Code states that no person shall be
responsible for a fortuitous event that could not be foreseen
or, though foreseen, was inevitable. In other words, there
must be an exclusion of human intervention from the
cause of injury or loss.24 (Emphasis and underscoring
supplied)
Assuming arguendo that fortuitous circumstances prevented
RCPI from delivering the telegram at the soonest possible
time, it should have at least informed Grace of the non-
transmission and the non-delivery so that she could have
taken steps to remedy the situation. But it did not. There lies
the fault or negligence.
In an earlier case also involving RCPI, this Court held:
Considering the public utility of RCPI’s business and its
contractual obligation to transmit messages, it should
exercise due diligence to ascertain that messages are
delivered to the persons at the given address and should
provide a system whereby in cases of undelivered messages
the sender is given notice of non-delivery. Messages sent by
cable or wireless means are usually more important and
urgent than those which can wait for the mail.25
x xxx
People depend on telecommunications companies in
times of deep emotional stress or pressing financial
needs. Knowing that messages about the illnesses or
deaths of loved ones, births or marriages in a family,
important business transactions, and notices of conferences
or meetings as in this case, are coursed through the
petitioner and similar corporations, it is incumbent upon them
to exercise a greater amount of care and concern than that
shown in this case. Every reasonable effort to inform
senders of the non-delivery of messages should be
undertaken.26
(Emphasis and underscoring supplied)
RCPI argues, however, against the presence of urgency in
the delivery of the telegram, as well as the basis for the
award of moral damages, thus:27
The request to send check as written in the telegraphic text
negates the existence of urgency that private respondents’
allegations that ‘time was of the essence’ imports. A check
drawn against a Manila Bank and transmitted to Sorsogon,
Sorsogon will have to be deposited in a bank in Sorsogon
and pass thru a minimum clearing period of 5 days before it
may be encashed or withdrawn. If the transmittal of the
requested check to Sorsogon took 1 day – private
respondents could therefore still wait for 6 days before the
same may be withdrawn. Requesting a check that would
take 6 days before it could be withdrawn therefore
contradicts plaintiff’s claim of urgency or need.28
At any rate, any sense of urgency of the situation was met
when Grace Verchez was able to communicate to Manila via
a letter that she sent to the same addressee in Manila thru
JRS.29
x xxx
As far as the respondent court’s award for moral damages is
concerned, the same has no basis whatsoever since private
respondent Alfonso Verchez did not accompany his late wife
when the latter went to Manila by bus. He stayed behind in
Sorsogon for almost 1 week before he proceeded to Manila.
30
When pressed on cross-examination, private respondent
Alfonso Verchez could not give any plausible reason as to
the reason why he did not accompany his ailing wife to
Manila.31
x xxx
It is also important to consider in resolving private
respondents’ claim for moral damages that private
respondent Grace Verchez did not accompany her ailing
mother to Manila.32
x xxx
It is the common reaction of a husband to be at his ailing
wife’s side as much as possible. The fact that private
respondent Alfonso Verchez stayed behind in Sorsogon for
almost 1 week convincingly demonstrates that he himself
knew that his wife was not in critical condition.33
(Emphasis and underscoring supplied)
RCPI’s arguments fail. For it is its breach of contract upon
which its liability is, it bears repeating, anchored. Since RCPI
breached its contract, the presumption is that it was at fault
or negligent. It, however, failed to rebut this presumption.
For breach of contract then, RCPI is liable to Grace for
damages.
And for quasi-delict, RCPI is liable to Grace’s co-
respondents following Article 2176 of the Civil Code which
provides:
Whoever by act or omission causes damage to another,
there being fault or negligence, is obliged to pay for the
damage done. Such fault or negligence, if there is no pre-
existing contractual relation between the parties, is called a
quasi-delict and is governed by the provisions of this
Chapter. (Underscoring supplied)
RCPI’s liability as an employer could of course be avoided if
it could prove that it observed the diligence of a good father
of a family to prevent damage. Article 2180 of the Civil Code
so 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.
x xxx
The owners and managers of an establishment or enterprise
are likewise responsible for damages caused by their
employees in the service of the branches in which the latter
are employed or on the occasion of their functions.
Employers shall be liable for the damages caused by their
employees and household helpers acting within the scope of
their assigned tasks, even though the former are not
engaged in any business or industry.
x xxx
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.
(Underscoring supplied)
RCPI failed, however, to prove that it observed all the
diligence of a good father of a family to prevent damage.
Respecting the assailed award of moral damages, a
determination of the presence of the following requisites to
justify the award is in order:
x xxfirstly, evidence of besmirched reputation or physical,
mental or psychological suffering sustained by the claimant;
secondly, a culpable act or omission factually established;
thirdly, proof that the wrongful act or omission of the
defendant is the proximate cause of damages sustained by
the claimant; and fourthly, that the case is predicated on any
of the instances expressed or envisioned by Article 2219 and
Article 2220 of the Civil Code.34
Respecting the first requisite, evidence of suffering by the
plaintiffs-herein respondents was correctly appreciated by
the CA in this wise:
The failure of RCPI to deliver the telegram containing the
message of appellees on time, disturbed their filial
tranquillity. Family members blamed each other for failing to
respond swiftly to an emergency that involved the life of the
late Mrs. Verchez, who suffered from diabetes.35
As reflected in the foregoing discussions, the second and
third requisites are present.
On the fourth requisite, Article 2220 of the Civil Code
provides:
Willful injury to property may be a legal ground for awarding
moral damages if the court should find that, under the
circumstances, such damages are justly due. The same rule
applies to breaches of contract where the defendant
acted fraudulently or in bad faith. (Emphasis and
underscoring supplied)
After RCPI’s first attempt to deliver the telegram failed, it did
not inform Grace of the non-delivery thereof and waited for
12 days before trying to deliver it again, knowing – as it
should know – that time is of the essence in the delivery of
telegrams. When its second long-delayed attempt to deliver
the telegram again failed, it, again, waited for another 12
days before making a third attempt. Such nonchalance in
performing its urgent obligation indicates gross negligence
amounting to bad faith. The fourth requisite is thus also
present.
In applying the above-quoted Article 2220, this Court has
awarded moral damages in cases of breach of contract
where the defendant was guilty of gross negligence
amounting to bad faith, or in wanton disregard of his
contractual obligation.36
As for RCPI’s tort-based liability, Article 2219 of the Civil
Code provides:
Moral damages may be recovered in the following and
analogous cases:
x xxx
(10) Acts and actions referred to in Articles 21, 26, 27, 28,
29, 30, 32, 34, and 35. (Emphasis supplied)
Article 26 of the Civil Code, in turn, provides:
Every person shall respect the dignity, personality, privacy
and peace of mind of his neighbors and other persons. The
following and similar acts, though they may not constitute a
criminal offense, shall produce a cause of action for
damages, prevention, and other relief:
x xxx
(2) Meddling with or disturbing the private life or family
relations of another. (Emphasis supplied)
RCPI’s negligence in not promptly performing its obligation
undoubtedly disturbed the peace of mind not only of Grace
but also her co-respondents. As observed by the appellate
court, it disrupted the "filial tranquillity" among them as they
blamed each other "for failing to respond swiftly to an
emergency." The tortious acts and/or omissions complained
of in this case are, therefore, analogous to acts mentioned
under Article 26 of the Civil Code, which are among the
instances of quasi-delict when courts may award moral
damages under Article 2219 of the Civil Code.
In fine, the award to the plaintiffs-herein respondents of
moral damages is in order, as is the award of attorney’s
fees, respondents having been compelled to litigate to
protect their rights.
Clutching at straws, RCPI insists that the limited liability
clause in the "Telegram Transmission Form" is not a contract
of adhesion. Thus it argues:
Neither can the Telegram Transmission Form be considered
a contract of adhesion as held by the respondent court. The
said stipulations were all written in bold letters right in front of
the Telegram Transmission Form. As a matter of fact they
were beside the space where the telegram senders write
their telegraphic messages. It would have been different if
the stipulations were written at the back for surely there is no
way the sender will easily notice them. The fact that the
stipulations were located in a particular space where they
can easily be seen, is sufficient notice to any sender (like
Grace Verchez-Infante) where she could manifest her
disapproval, leave the RCPI station and avail of the services
of the other telegram operators.37 (Underscoring supplied)
RCPI misunderstands the nature of a contract of adhesion.
Neither the readability of the stipulations nor their physical
location in the contract determines whether it is one of
adhesion.
A contract of adhesion is defined as one in which one of the
parties imposes a ready-made form of contract, which the
other party may accept or reject, but which the latter cannot
modify. One party prepares the stipulation in the contract,
while the other party merely affixes his signature or his
"adhesion" thereto, giving no room for negotiation and
depriving the latter of the opportunity to bargain on
equal footing.38 (Emphasis and underscoring supplied)
While a contract of adhesion is not necessarily void and
unenforceable, since it is construed strictly against the party
who drafted it or gave rise to any ambiguity therein, it is
stricken down as void and unenforceable or subversive of
public policy when the weaker party is imposed upon in
dealing with the dominant bargaining party and is reduced to
the alternative of taking it or leaving it, completely deprived
of the opportunity to bargain on equal footing.39
This Court holds that the Court of Appeals’ finding that the
parties’ contract is one of adhesion which is void is, given
the facts and circumstances of the case, thus well-taken.
WHEREFORE, the petition is DENIED, and the challenged
decision of the Court of Appeals is AFFIRMED.
Costs against petitioner.
SO ORDERED.
[ G.R. No. 143360, September 05, 2002 ]
EQUITABLE LEASINGCORPORATION,
PETITIONER, VS. LUCITA SUYOM, MARISSA ENANO,
MYRNA TAMAYO AND FELIX OLEDAN, RESPONDENTS.
DECISION
PANGANIBAN, J.:
In an action based on quasi delict, the registered owner of a
motor vehicle is solidarily liable for the injuries and damages
caused by the negligence of the driver, in spite of the fact
that the vehicle may have already been the subject of an
unregistered Deed of Sale in favor of another person. Unless
registered with the Land Transportation Office, the sale --
while valid and binding between the parties -- does not affect
third parties, especially the victims of accidents involving the
said transport equipment. Thus, in the present case,
petitioner, which is the registered owner, is liable for the acts
of the driver employed by its former lessee who has become
the owner of that vehicle by virtue of an unregistered Deed
of Sale.
Statement of the Case
Before us is a Petition for Review under Rule 45 of the Rules
of Court, assailing the May 12, 2000 Decision[1] of the Court
of Appeals[2] (CA) in CA-GR CV No. 55474. The decretal
portion of the Decision reads as follows:
“WHEREFORE, premises considered, the instant appeal is
hereby DISMISSEDfor lack of merit. The assailed decision,
dated May 5, 1997, of the Regional Trial Court of Manila,
Branch 14, in Civil Case No. 95-73522, is
hereby AFFIRMED with MODIFICATION that the award of
attorney’s fees is DELETED.”[3]
On the other hand, in Civil Case No. 95-73522, the Regional
Trial Court (RTC) of Manila (Branch 14) had earlier disposed
in this wise:
“WHEREFORE, judgment is hereby rendered in favor of the
plaintiffs and against the
defendant Equitable LeasingCorporation ordering said
defendant to pay to the plaintiffs the following:
A. TO MYRNA TAMAYO
1. the sum of P50,000.00 for the death of Reniel Tamayo;
2. P50,000.00 as moral damages; and
3. P56,000.00 for the damage to the store and its contents,
and funeral expenses.
B. TO FELIX OLEDAN
1. the sum of P50,000.00 for the death of FelmarieOledan;
2. P50,000.00 as moral damages; and
3. P30,000.00 for medical expenses, and funeral expenses.
C. TO MARISSA ENANO
1. P7,000.00 as actual damages
D. TO LUCITA SUYOM
1. The sum of P5,000.00 for the medical treatment of her two
sons.
The sum of P120,000.00 as and for attorney’s fees.”[4]
The Facts
On July 17, 1994, a Fuso Road Tractor driven by Raul Tutor
rammed into the house cum store of Myrna Tamayo located
at Pier 18, Vitas, Tondo, Manila. A portion of the house was
destroyed. Pinned to death under the engine of the tractor
were Respondent Myrna Tamayo’s son, Reniel Tamayo, and
Respondent Felix Oledan’s daughter, FelmarieOledan.
Injured were Respondent Oledan himself, Respondent
Marissa Enano, and two sons of Respondent Lucita Suyom.
Tutor was charged with and later convicted of reckless
imprudence resulting in multiple homicide and multiple
physical injuries in Criminal Case No. 296094-SA,
Metropolitan Trial Court of Manila, Branch 12.[5]
Upon verification with the Land Transportation Office,
respondents were furnished a copy of Official Receipt No.
62204139[6] and Certificate of Registration No.
08262797,[7] showing that the registered owner of the tractor
was “Equitable LeasingCorporation/leased to Edwin Lim.”
On April 15, 1995, respondents filed against Raul Tutor,
Ecatine Corporation (“Ecatine”)
and Equitable LeasingCorporation (“Equitable”) a
Complaint[8]for damages docketed as Civil Case No. 95-
73522 in the RTC of Manila, Branch 14.
The trial court, upon motion of plaintiffs’ counsel, issued an
Order dropping Raul Tutor, Ecatine and Edwin Lim from the
Complaint, because they could not be located and served
with summonses.[9]On the other hand, in its Answer with
Counterclaim,[10] petitioner alleged that the vehicle had
already been sold to Ecatine and that the former was no
longer in possession and control thereof at the time of the
incident. It also claimed that Tutor was an employee, not
of Equitable, but of Ecatine.
After trial on the merits, the RTC rendered its Decision
ordering petitioner to pay actual and moral damages and
attorney’s fees to respondents. It held that since the Deed of
Sale between petitioner and Ecatine had not been registered
with the Land Transportation Office (LTO), the legal owner
was still Equitable.[11] Thus, petitioner was liable to
respondents.[12]
Ruling of the Court of Appeals
Sustaining the RTC, the CA held that petitioner was still to
be legally deemed the owner/operator of the tractor, even if
that vehicle had been the subject of a Deed of Sale in favor
of Ecatine on December 9, 1992. The reason cited by the
CA was that the Certificate of Registration on file with the
LTO still remained in petitioner’s name.[13] In order that a
transfer of ownership of a motor vehicle can bind third
persons, it must be duly recorded in the LTO.[14]
The CA likewise upheld respondents’ claim for moral
damages against petitioner because the appellate court
considered Tutor, the driver of the tractor, to be an agent of
the registered owner/operator.[15]
Hence, this Petition.[16]
Issues
In its Memorandum, petitioner raises the following issues for
the Court’s consideration:
I
“Whether or not the Court of Appeals and the trial court
gravely erred when they decided and held that petitioner
[was] liable for damages suffered by private respondents in
an action based on quasi delict for the negligent acts of a
driver who [was] not the employee of the petitioner.
II
“Whether or not the Court of Appeals and the trial court
gravely erred when they awarded moral damages to private
respondents despite their failure to prove that the injuries
they suffered were brought by petitioner’s wrongful act.”[17]
This Court’s Ruling
The Petition has no merit.
First Issue:
Liability for Wrongful Acts
Petitioner contends that it should not be held liable for the
damages sustained by respondents and that arose from the
negligence of the driver of the Fuso Road Tractor, which it
had already sold to Ecatine at the time of the accident. Not
having employed Raul Tutor, the driver of the vehicle, it
could not have controlled or supervised him.[18]
We are not persuaded. In negligence cases, the aggrieved
party may sue the negligent party under (1) Article 100[19]of
the Revised Penal Code, for civil liability ex delicto; or (2)
under Article 2176[20] of the Civil Code, for civil liability ex
quasi delicto.[21]
Furthermore, under Article 103 of the Revised Penal Code,
employers may be held subsidiarily liable for felonies
committed by their employees in the discharge of the latter’s
duties.[22] This liability attaches when the employees who are
convicted of crimes committed in the performance of their
work are found to be insolvent and are thus unable to satisfy
the civil liability adjudged.[23]
On the other hand, under Article 2176 in relation to Article
2180[24] of the Civil Code, an action predicated on quasi
delict may be instituted against the employer for an
employee’s act or omission. The liability for the negligent
conduct of the subordinate is direct and primary, but is
subject to the defense of due diligence in the selection and
supervision of the employee.[25] The enforcement of the
judgment against the employer for an action based on Article
2176 does not require the employee to be insolvent, since
the liability of the former is solidary -- the latter being
statutorily considered a joint tortfeasor.[26] To sustain a claim
based on quasi delict, the following requisites must be
proven: (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 the damage incurred by the plaintiff.[27]
These two causes of action (ex delicto or ex quasi delicto)
may be availed of, subject to the caveat[28] that the offended
party cannot “recover damages twice for the same act or
omission” or under both causes.[29] Since these two civil
liabilities are distinct and independent of each other, the
failure to recover in one will not necessarily preclude
recovery in the other.[30]
In the instant case, respondents -- having failed to recover
anything in the criminal case -- elected to file a separate civil
action for damages, based on quasi delict under Article 2176
of the Civil Code.[31] The evidence is clear that the deaths
and the injuries suffered by respondents and their kins were
due to the fault of the driver of the Fuso tractor.
Dated June 4, 1991, the Lease Agreement[32] between
petitioner and Edwin Lim stipulated that “it is the intention of
the parties to enter into a FINANCE LEASE
AGREEMENT.”[33] Under such scheme, ownership of the
subject tractor was to be registered in the name of petitioner,
until the value of the vehicle has been fully paid by Edwin
Lim.[34]Further, in the “Lease Schedule,”[35] the monthly rental
for the tractor was stipulated, and the term of the Lease was
scheduled to expire on December 4, 1992. After a few
months, Lim completed the payments to cover the full price
of the tractor.[36] Thus, on December 9, 1992, a Deed of
Sale[37] over the tractor was executed by petitioner in favor of
Ecatine represented by Edwin Lim. However, the Deed was
not registered with the LTO.
We hold petitioner liable for the deaths and the injuries
complained of, because it was the registered owner of the
tractor at the time of the accident on July 17, 1994.[38] The
Court has consistently ruled that, regardless of sales made
of a motor vehicle, the registered owner is the lawful
operator insofar as the public and third persons are
concerned; consequently, it is directly and primarily
responsible for the consequences of its operation.[39] In
contemplation of law, the owner/operator of record is the
employer of the driver, the actual operator and employer
being considered as merely its agent.[40] The same principle
applies even if the registered owner of any vehicle does not
use it for public service.[41]
Since Equitable remained the registered owner of the tractor,
it could not escape primary liability for the deaths and the
injuries arising from the negligence of the driver.[42]
The finance-lease agreement between Equitable on the one
hand and Lim or Ecatine on the other has already been
superseded by the sale. In any event, it does not bind third
persons. The rationale for this rule has been aptly explained
in Erezo v. Jepte,[43] which we quote hereunder:
“x xx. The main aim of motor vehicle registration is to identify
the owner so that if any accident happens, or that any
damage or injury is caused by the vehicle on the public
highways, responsibility therefor can be fixed on a definite
individual, the registered owner. Instances are numerous
where vehicles running on public highways caused accidents
or injuries to pedestrians or other vehicles without positive
identification of the owner or drivers, or with very scant
means of identification. It is to forestall these circumstances,
so inconvenient or prejudicial to the public, that the motor
vehicle registration is primarily ordained, in the interest of the
determination of persons responsible for damages or injuries
caused on public highways.”[44]
Further, petitioner’s insistence on FGU Insurance Corp. v.
Court of Appeals is misplaced.[45] First, in FGU Insurance,
the registered vehicle owner, which was engaged in a rent-a-
car business, rented out the car. In this case, the registered
owner of the truck, which is engaged in the business of
financing motor vehicle acquisitions, has actually sold the
truck to Ecatine, which in turn employed Tutor. Second,
in FGU Insurance, the registered owner of the vehicle was
not held responsible for the negligent acts of the person who
rented one of its cars, because Article 2180 of the Civil Code
was not applicable. We held that no vinculum juris as
employer and employee existed between the owner and the
driver.[46] In this case, the registered owner of the tractor is
considered under the law to be the employer of the driver,
while the actual operator is deemed to be its
agent.[47] Thus, Equitable, the registered owner of the tractor,
is -- for purposes of the law on quasi delict -- the employer of
Raul Tutor, the driver of the tractor. Ecatine, Tutor’s actual
employer, is deemed as merely an agent of Equitable.[48]
True, the LTO Certificate of Registration, dated “5/31/91,”
qualifies the name of the registered owner as
“EQUITABLELEASING CORPORATION/Leased to Edwin
Lim.” But the lease agreement between Equitable and Lim
has been overtaken by the Deed of Sale on December 9,
1992, between petitioner and Ecatine. While this Deed does
not affect respondents in this quasi delict suit, it definitely
binds petitioner because, unlike them, it is a party to it.
We must stress that the failure of Equitable and/or Ecatine to
register the sale with the LTO should not prejudice
respondents, who have the legal right to rely on the legal
principle that the registered vehicle owner is liable for the
damages caused by the negligence of the driver. Petitioner
cannot hide behind its allegation that Tutor was the
employee of Ecatine. This will effectively prevent
respondents from recovering their losses on the basis of the
inaction or fault of petitioner in failing to register the sale.
The non-registration is the fault of petitioner, which should
thus face the legal consequences thereof.
Second Issue:
Moral Damages
Petitioner further claims that it is not liable for moral
damages, because respondents failed to establish or show
the causal connection or relation between the factual basis
of their claim and their wrongful act or omission, if any. [49]
Moral damages are not punitive in nature, but are designed
to compensate[50] and alleviate in some way the physical
suffering, mental anguish, fright, serious anxiety, besmirched
reputation, wounded feelings, moral shock, social
humiliation, and similar injury unjustly caused a
person.[51] Although incapable of pecuniary computation,
moral damages must nevertheless be somehow proportional
to and in approximation of the suffering inflicted.[52] This is so
because moral damages are in the category of an award
designed to compensate the claimant for actual injury
suffered, not to impose a penalty on the wrongdoer.[53]

Viewed as an action for quasi delict, the present case falls

squarely within the purview of Article 2219 (2),[54] which
provides for the payment of moral damages in cases of
quasi delict.[55]Having established the liability of petitioner as
the registered owner of the vehicle,[56] respondents have
satisfactorily shown the existence of the factual basis for the
award[57] and its causal connection to the acts of Raul Tutor,
who is deemed as petitioner’s employee.[58] Indeed, the
damages and injuries suffered by respondents were the
proximate result of petitioner’s tortious act or omission.[59]
Further, no proof of pecuniary loss is necessary in order that
moral damages may be awarded, the amount of indemnity
being left to the discretion of the court.[60] The evidence gives
no ground for doubt that such discretion was properly and
judiciously exercised by the trial court.[61] The award is in fact
consistent with the rule that moral damages are not intended
to enrich the injured party, but to alleviate the moral suffering
undergone by that party by reason of the defendant’s
culpable action.[62]
WHEREFORE, the Petition is DENIED and the assailed
Decision AFFIRMED. Costs against petitioner.
SO ORDERED.
[ G.R. No. L-5378, May 24, 1954 ]
IN RE PETITION FOR REGISTRATION OF TRADEMARK
"FREEDOM" UNDER SECTION 4 OF REPUBLIC ACT NO.
166 FILED IN THE PHILIPPINE PATENT OFFICE
BEARING SERIAL NO. 38. CO TIONG SA, APPLICANT
PETITIONER, VS. DIRECTOR OF PATENTS,
RESPONDENT, SAW WOO CHIONG & CO., OPPOSITOR.
DECISION
LABRADOR, J.:
This is an appeal filed by Co Tiong Sa, applicant for
registration of the trademark "FREEDOM" and its
corresponding design, against a decision of the Director of
Patents sustaining the opposition thereto of Saw Woo
Chiong& Co., and denying the application. The applicant in
said registration proceeding, now petitioner in this Court, has
used the trademark on undershirts and T-shirt since March,
1947. The trademark sought to be registered is
"FREEDOM". The word "FREEDOM" is in hand print, with a
slight slant to the right. In the facsimiles attached to the
original application, there are no letters, lines, or figures
around the word, but in the label, Exhibit D-1, the said word
is preceded by a triangle, with the letter "F" inside and small
letters "H.L." under. A capital letter "L" is on the lower right-
hand corner; and all of these are enclosed in a rectangle of
double lines. In Exhibit D-2, the label is the same word
"FREEDOM" with a capital letter "M" above it, a flourish
under the word "FREEDOM", and the words "HIGH
QUALITY " thereunder. The label used for boxes is similar to
label Exhibit D-1, except that the rectangle is in a heavy line
and is longer.
The label presented by Saw Woo Chiong& Co., oppositor-
respondent herein (Exhibit D-3), consist of the word
"FREEMAN" in hand print, with a right slant, above the
middle of which is a vignette of a man wearing a tophat,
which vignette is preceded by the small word "The" in print
and followed by two parallel lines close to each other, and
the words "PERFECT WEAR " in smaller letters under the
word "FREEMAN". This trademark was registered in 1947 in
the Bureau of Commerce and re-registered in the Patent
Office on September 22, 1948. This trademark is used not
only on shirts, but also on polo shirts, undershirts, pajamas,
skippers, and T-shirts, although in the year 1947 Saw Woo
Chiong& Co. discontinued manufacturing skippers and T-
shirts on the ground of scarcity of materials. This trademark
has been used since 1938, and it had been advertised
extensively in newspapers, magazines, etc.
The applicant-petitioner claims that in sustaining the
objection of the oppositor-respondent, the Director of
Patents erred: (1) in holding that in determining an
opposition in the registration of trademarks, attention should
be centered upon the central idea of each trademark,
disregarding their differences in details; (2) in holding that if
the central idea of each trademark gives the same general
impression, the two trademarks should be adjudged as
confusingly similar; (3) in holding that the word "FREEDOM"
and "FREEMAN" convey the same general impression,
hence must be adjudged to be confusingly similar; (4) in
holding that if the word "FREEDOM" is allowed to be
registered as trademark, although no confusion and
deception will actually take place, the oppositor will
nevertheless be damaged; and (5) in holding that the
oppositor is not required to introduce testimony to
substantiate the claim made in its opposition.
The first four assignments of error are related to each other
and may be considered together. There is no question that if
the details of the two trademarks are to be considered, many
differences would be noted that would enable a careful and
scrutinizing eye to distinguish one trademark from the other.
Thus, we have the vignette of a man wearing a tophat, which
would distinguish the oppositor's label from the triangle with
the letter "F" on the right hand corner of applicant's label.
Then we also have the rectangle enclosing the applicant's
mark, which rectangle is absent in that of the oppositor's. But
differences of variations in the details of one trademark and
of another are not the legally accepted tests of similarity in
trademarks. It has been consistently held that the question of
infringement of a trademark is to be determined by the test
of dominancy. Similarity in size, form, and color, While
relevant, is not conclusive. If the competing trademark
contains the main or essential or dominant features of
another, and confusion and deception is likely to result,
infringement takes place. Duplication or imitation is not
necessary; nor is it necessary that the infringing label should
suggest an effort to imitate. (G. Heilman Brewing Co. vs.
Independent Brewing Co., 191 F., 489, 495, citing Eagle
White Lead Co. vs. Pflugh (CC) 180 Fed. 579.) The question
at issue in cases of infringement of trademarks is whether
the use of the marks involved would be likely to cause
confusion or mistake in the mind of the public or to deceive
purchasers. (Auburn Rubber Corporation vs.Honover
Rubber Co., 107 F. 2d, 588, citing Procter and Gamble Co.
vs. J. L. Prescott Co., 49 F. 2d, 959, 18 CCPA, Patent, 1433;
Pepsodent Co. vs. Comfort Manufacturing Co., 83 F. 2d,
906, 23 CCPA, Patents, 1224.)
When would a trademark cause confusion in the mind of the
public or in those unwary customers or purchasers? It must
be remembered that infringement of a trademark is a form of
unfair competition (Clarke vs. Manila Candy Co., 36 Phil,
100), and unfair competition is always a question of fact. The
universal test has been said to be whether the public is likely
to be deceived. (Alhambra Cigar & Cigarette Co. vs. Mojica,
27 Phil., 266.)
When a person sees an object, a central or dominant idea or
picture thereof is formed in his mind. This dominant picture
or idea is retained in the mind, and the decorations or details
are forgotten. When one sees the city hall of Baguio, the
dominant characteristics which are likely to be retained in the
mind are the portico in the middle of the building, the tower
thereon, the four columns supporting it, and the wings on
both sides. The features that are retained are the peculiar,
dominant features. When one sees the Legislative Building
in Manila, the picture that is retained is that of a majestic low
building with concrete columns all around. In this mind-
picture the slight or minor decorations are lost sight of, and
the central figure only is retained. So is it with a customer or
purchaser who sees a label. He retains in his mind the
dominant characteristics or features or central idea in the
label, and does not retain or forgets the attendant
decorations, flourishes, or variations. The ordinary customer
does not scrutinize the details of the label; he forgets or
overlooks these, but retains a general impression, or a
central figure, or a dominant characteristic. The reason for
the above has been explained in the following manner:
* * * This rule has a basis in experience. The average person
usually will not, and often can not, take in at a casual glance
all, or even a large part of the details of what he looks at.
What part or parts of two trademarks which are alleged to be
similar does the average ordinary buyer see when he looks
at them? What features of them are remembered by the
average buyer? We do not really hear all that is spoken in
our hearing. Far from all we see or hear casually is retained
sufficiently clearly or insufficient detail for us to get a lasting
impression of it which we can remember when we encounter
the mark again. The importance of this rule is emphasized
by the increase of radio advertising in which we are deprived
of the help of our eyes and must depend entirely on the ear.
The average buyer usually seeks a sign, some special,
easily remembered earmarks: of the brand he has in mind. It
may be the color, sound, design, or a peculiar shape or
name. Once his eyes see that or his ear hears it, he is
satisfied. An unfair competitor need not copy the entire mark
to accomplish his fraudulent purpose. It is enough if he takes
the one feature which the average buyer is likely to
remember. (Nims, The Law of Unfair Competition and
Trademarks, 4th ed., Vol. 2, pp. 678-679).
The question of infringement is to be determined by the test
of dominancy. The dissimilarity in size, form and color of the
label and the place where applied are not conclusive. If the
competing label contains the trademark of another, and
confusion or deception is likely to result, infringement takes
place, regardless of the fact that the accessories are
dissimilar. Duplication or exact imitation is not necessary;
nor is it necessary that the infringing label should suggest an
effort to imitate. (G. Heilman Brewing Co. vs. Independent
Brewing Co., 191 F., 489, citing Eagle Co. vs. Pflugh (C.C.)
180 F., 579.)
In order to constitute infringement, it is not necessary that
the trademark be literally copied. * * *. Neither is it necessary
that every word be appropriated. There may be infringement
where the substantial and distinctive part of the trademark is
copied or imitated * * *. Dissimilarity in size, form and color of
the label and place where it is applied are not conclusive
against infringement. * * *. The resemblances may so far
dominate the differences as to be likely to deceive ordinary
purchasers. (Queen Mfg. Co. vs. Isaac Ginsberg Bros. Co.,
25 F 2d, 284, 287. See also Finchley, Inc. vs. George Hess
Co., Inc., et al, 24 F., Supp. 94.)
Upon examination of the trademark of the oppositor-
respondent, one will readily see that the dominant feature is
the word "FREEMAN" written in a peculiar print, slightly
slanting to the right, with a peculiarly written capital letters
"FF" These dominant features or characteristics of
oppositor's trademarks are reproduced or imitated in
applicant's trademark. In the first place, the word
"FREEDOM" conveys a similar idea as the word
"FREEMAN". In the second place, the style in which both
capital "F" are written are similar. The print and slant of the
letters are also similar. An ordinary purchaser or an
unsuspecting customer who has seen the oppositor's label
sometime before will not recognize the difference between
that label and applicant's label. He may notice some
variations, but he will ignore these, believing that they are
variations of the same trademark to distinguish one kind or
quality of goods from another.
For purposes of illustration, the following words have been
held to have the same significance or to have the same
appearance and meaning.
"CELDURA" and "COBDURA".—That both marks
considered as a whole are similar in meaning and
appearance can not be doubted. When spoken as written
they sound very much alike. Similarity of sound alone, under
such circumstances, is sufficient to cause the marks to be
regarded as confusingly similar when applied to
merchandise of the same descriptive properties. (Celanes
Corporation of America vs. E. I. Du Pont de Nemours & Co.
(1946), 154 F. 2d 146 148.)
"SKOAL" and "SKOL", "SKOAL" was held identical in sound
and meaning to "Skol". (Skol Co., Inc., vs. Olson, 151 F. 2d,
200.)
In this jurisdiction we have held that the name "Lusolin" is an
infringement of the trademark "Sapolin," as the sound of the
two names is almost the same, and the labels of containers
being almost the same in respect to color, size, and other
characteristics. (Sapolin Co, vs. Balmeceda and Germann&
Co., 67 Phil., 705.)
In the case of La Insular vs. JaoOge, 47 Phil., 75, plaintiff's
label represented an European female, while defendant's
was a Filipino, but both labels exhibited a matron seated on
a platform with a view of Manila Bay looking towards
Mariveles at sunset. In spite of the fact that the posture and
coloring were slightly different, defendant's labels were
declared to constitute an infringement of plaintiff's labels.
After a careful study, we find that the dominant characteristic
of oppositor's trademark "FREEMAN" has been imitated in
applicants's trademark "Freedom," such as to confuse the
public and unwary customers and purchasers, and to
deceive them into believing that the articles bearing one
label are similar or produced by the same manufacturer as
those carrying the other label. The decision of the Director of
Patents sustaining the opposition and denying the
application must, therefore, be affirmed.
With respect to the fifth assignment of error (first in
petitioner's brief), it must be remembered that the question of
similarity or dissimilarity, while it is a question of opinion, is
to be determined by the court mainly on the basis of the
facsimiles or labels or pictures submitted to the Director of
Patents. In the case at bar, innumerable exhibits were
presented to show the similarity. Similarity or dissimilarity
can be determined by the Director of Patents, or by this
Court on appeal, by a mere examination and comparison of
the competing trademarks. Failure on the part of the
oppositor to submit the testimony of witnesses, who are to
give opinions on the alleged similarity or dissimilarity, can
not, therefore, be a ground for a dismissal of an opposition.
We hold that the Director of Patents did not err in denying
the motion for dismissal presented by the applicant upon the
failure of the oppositor to submit witnesses to sustain his
opposition.
 [ G.R. No. L-8072, October 31, 1956 ]
LIM HOA, PETITIONER, VS. DIRECTOR OF PATENTS,
RESPONDENT.
DECISION
MONTEMAYOR, J.:
On April 26,1949, the petitioner, Lim Hoa, filed with the
Patent Office an application for the registration of a
trademark, consisting of a representation of two midget
roosters in an attitude of combat with the word "Bantam"
printed above them, he claiming that he had used said
trademark on a food seasoning product since April 25 of that
year. The application was published in the Official Gazette in
its issue of February, 1953, released for circulation on April
18, of the same year. On April 30, 1953, the Agricom
Development Co., Inc., a domestic corporation, opposed the
application on several grounds, among others, that the
trademark sought to be registered was confusingly similar to
its register mark, consisting of a pictorial representation of a
hen with the words "Hen Brand" and "Marca Manok", which
mark or brand was also used on a food seasoning product,
before the use of the trademark by the applicant
It is a fact that the family of C. Javier Advincula, since the
year 1946, had adopted and used as a trademark of said
food seasoning product manufactured by it, the pictorial
representation of a hen. In 1947, the members of the
Advincula family organized the Agricom Development Co.,
Inc., the oppositor in this case, and said corporation took
over the manufacture of the same food product of the
Advincula family, including the use of the brand of the
pictorial representation of a hen but adding to it the word
"Hen". In the year 1948, an addition was made to the brand
with the words "Ve-Tsin, Hen Brand" and "Marca Manok,"
and since then, on its food seasoning product at different
times, labels were used, in different colors but bearing the
representation of a hen and the words just mentioned." So
that the application to register applicant's brand, consisting
of two roosters is an attitude of combat, with the word
"Bantam" printed above them, came along after the use and
registration of the mark or brand of the oppositor corporation
and its predecessor, the Advincula family.
After considering the application and the opposition thereto,
and after comparing the two brands, the Director of Patents
issued his order dated June 26, 1954, wherein he found and
held that to allow the registration of the applicant's trademark
would likely cause confusion or "mistake or deceive
purchasers, and he refused registration of said trademark,
under Rule 178 of the Revised Rules of Practice in
Trademark Cases, 1953. The petitioner is now appealling
said order.
After a careful examination of the facts above mentioned,
and after comparing the two brands, we do not hesitate to
say and to hold that there is such similarity between the two
brands s& to cause confusion in the mind of the public that
buys the food seasoning product on the strenght and on the
indication of the trademark or brand identifying or
distinguishing the same. In the case of Go Tiong Sa vs.
Director of Patents, (95 Phil., 1), we had occasion to say the
following:
"* * * It has been consistently held that the question of
infringement of a trademark is to be determined by the test
of dominancy. Similarity in size, form, and color, while
relevant, is not conclusive. If the competing trademark
contains the main or essential or dominant features of
another, and confusion and deception is likely to result,
infringement takes place. Duplication or imitation is not
necessary; nor it is necessary that the infringing-label should
suggest an effort to imitate. (C. Neilman Brewing: Co. vs.
Independent Brewing Co., 191 F. 489, 495, citing Eagle
White Lead Co. v. Pflugh (CC) 180 Fed. 579). The question
at issue in cases of infringement of trademarks is whether
the use of the marks involved would be likely to cause
confusion or mistakes in ihe mind of the public or deceive
purchasers. (Auburn Rubber Corporation vs. Honover
Rubber Co., 107 F 2d 588, 590, citing Procter and Gamble
Co. vs. J. L. Prescot Co., 49 F 2d 959, 18 CCPA, Patents,
1433; Pepsodent Co. vs. Comfort Manufacturing Co., 83 F
2d 906; 23 CCPA, Patents, 124)"
The danger of confusion in trademarks and brands which are
similar may not be so great in the case of commodities or
articles of relatively great value, such as, radio and television
sets, air conditioning units, machinery, etc., for the
prospective buyer, generally the head of the family or a
businessman, before making the purchase, reads the
pamphlets and all literature available, describing the article
he is planning to buy, and perhaps even makes comparisons
with similar articles in the market. He is not likely to be
deceived by similarity in the trademarks because he makes
a more or less thorough study of the same and may even
consult his friends about the relative-merit and performance
of the article or machinery, as compared to others also for
sale. But in the sale of a food seasoning product, a kitchen
article of everyday consumption, the circumstances are far
different. Said product is generally purchased by cooks and
household help, sometimes illiterate who are guided by
pictorial representations and the sound of the word
descriptive of said representation. The two roosters
appearing in the trademark of the applicant and the hen
appearing on the trademark of the oppositor, although of
different sexes, belong to the same family of chicken, known
as manok in all the principal dialects of the Philippines, and
when a cook or a household help or even a housewife buys
a food seasoning product for the kitchen the brand of
"Manok" or "Marca Manok" would most likely be upper most
in her mind and would influence her in selecting the product,
regardless of whether the brand pictures a hen or a rooster
or two roosters. To her, they are all manok. Therein lies the
confusion, even deception.
We do not see why applicant could not have streched his
imagination even a little and' extended his choice to other
members of the animal kingdom, as a brand to differentiate
his product from similar products in the market. In a similar
case decided by this Tribunal wherein, although one brand
consisting of the representation of a rooster was already
being used by one party, another party wanted to register a
similar brand, consisting of two roosters on a similar product,
namely, candy, this Court said:
"Counsel for defendant insists that there is no real
resemblance between a picture of one rooster and a picture
of two roosters; that no person could or would be deceived
by the use by the defendant of a trade-mark wholly distinct
from that of the plaintiff; that the fact that the defendant used
two roosters as its trademark clearly discloses its innocence
of any intent to deceive, since a comparison of the trade-
mark of the plaintiff with that of the defendant makes
apparent at once that was not intended to be an imitation of
the other.
"We ask, however, why, with all the birds in the air, and all
the fishes in the sea, and all the animals on the face of the
earth to chose from, the defendant company selected two
roosters as its trade-mark, although its directors, and
managers must have been well aware of the long-continued
use of a rooster by the plaintiff in connection with the sale
and advertisement of his goods?
"There is nothing the picture of one or more roosters which
in itself is discriptive of the goods sold by the plaintiff or by
the defendant corporation, or suggestive of the quality of
these goods. A cat, or dog, a carabao, a shark, or an eagle
stamped upon the container in which candies are sold would
serve as well as a rooster for purposes of identification as
the product of defendant's factory. Why did defendant select
two roosters as its trade-mark? We can not doubt that it was
because the plaintiff's candies had acquired a certain
reputation under the trade-mark of a rooster, and the
defendant corporation hoped to profit unjustly by that
reputation. Defendant knew that the use of a single rooster
would be prohibited as a technical infringement of plaintiff's
trade-mark, but it hoped that it could avoid that danger by
the use of two roosters; and at the same time get such
advantage as it must have believed it could secure from the
use of a design on the containers of its goods, not absolutely
identical with that used by the plaintiff, but so similar in the
dominant idea as to confuse or mislead the purchasers. * * *"
(Clarke vs. Manila Candy Co., 100Phil. 36).
In view of the foregoing, the order appealed from is hereby
affirmed, with costs. We do not deem it necessary to discuss
and rule upon the other questions raised in £he appeal.
Paras, C. J., Padilla, Bautista Angela, Labrador,
Concepcion, Reyes, J. B. L, and Felix, JJ., concur.
[ G.R. No. L-19297, December 22, 1966 ]
MARVEX COMMERCIAL CO., INC., PETITIONER, VS.
PETRA HAWPIA& CO., AND THE DIRECTOR OF
PATENTS, RESPONDENTS.
DECISION
RUIZ CASTRO, J.:
Petra Hawpia& Co., a partnership duly organised under the
laws of the Philippines and doing business at 543 M. de
Santos (BoticaDivisoria), Manila (hereinafter referred to as
the applicant), on October 14, 1958 filed a petition for the
registration of the trademark "LIONPAS" used on medicated
plaster, with the Philippine Patent Office, asserting its
continuous use in the Philippines since June 9, 1958.[1] The
Marvex Commercial Co., Inc., a corporation also duly
organized under the laws of the Philippines (hereinafter
referred to as the oppositor), on July 24, 1959 filed an
opposition thereto, alleging that the registration of such
trademark would violate its right to and interest in the
trademark "SALONPAS" used on another medicated plaster,
which is registered in its name under Certificate of
Registration 5466, issued by the Director of Patents on
September 29, 1956, and that both trademarks when used
on medicated plaster would mislead the public as they are
confusingly similar.
After due hearing, the Director of Patents in his decision of
August 16, 1961 dismissed the opposition and gave due
course to the petition, stating in part that "confusion, mistake,
or deception among the purchasers will not likely and
reasonably occur" when both trademarks are applied to
medicated plaster. The oppositor moved to have the
decision reconsidered. This motion was denied in a
resolution of November 27, 1961. The oppositor then
interposed the present appeal.
The issues stated by the Director of Patents in his decision
are the same ones now tendered by the oppositor for
resolution, namely, (1) Is the applicant the owner of the
trademark "LI0NPAS"?; (2) Should the application be
rejected on the ground that the applicant made false
representations in placing the phrase "Reg. Phil. Pat. Off."
below the trademark "LIONPAS" on its cartons?; and (3) Is
the "trademark "LIONPAS" confusingly similar to the
trademark "SALONPAS"?
We do not consider the second issue of any importance; we
will thus proceed to resolve the first and third issues.
Is the applicant the owner of the trademark "LIONPAS"?
Under sections 2 and 2-A of the Trade Mark Law, as
amended, the right to register trademarks, tradeoames and
service marks by any person, corporation, partnership or
association domiciled in the Philippines or in any foreign
country, is based on ownership, and the burden is upon the
applicant to prove such ownership (Operators, Inc. vs. The
Director of Patents, et al., L-17901, Oct. 29, 1965).
The Director of Patents found, on the strength of exhibits 5
and 6 for the applicant, that the latter has "satisfactorily
shown" its ownership of the trademark sought to be
registered. Exhibit 5 is a letter dated June 20, 1958, sent by
"OSAKA BOEKI KAISHA, LTD." to the applicant which tends
to show that the former, for a $1 consideration, has
assigned, ceded, and conveyed all its "rights, interests and
goodwill in the tradename LIONPAS Medicated Plaster * * *"
in favor of the latter. Exhibit 6 is a joint "SWORN
STATEMENT" which appears to have been executed by the
presidents of "OSAKA BOEKI KAISHA, LTD." and
"ASUNARO PHARMACEUTICAL INDUSTRY CO.", and
tends to confirm the contents of exhibit 5.
A careful scrutiny of exh. 5 will reveal, however, that the
sender of the letter, "OSAKA BOEKI KAISHA, LTD." and
which appears to be the seller, is merely a representative of
the manufacturer "ASUNARO PHARMACEUTICAL
INDUSTRY CO." There is no proof that as such
representative, the former has been authorised by the latter
to sell the trademark in question. Moreover, exh. 5 on its
face appears to have been signed only by someone whose
position in the company's "Sundries Dept."is not described;
the signature is net legible. It is even contradicted by exh.
While exh. 5 shows that "OSAKA BOEKI KAISHA, LTD." is a
representative of "ASUNARO PHARMACEUTICAL
INDUSTRY CO."; exh. 6 asserts that the former is not a
representative of the latter, but that it is the owner of the
trademark "LIONPAS" (par. 2, exh. 6). At all events, neither
averment can be accorded the weight of an assignment of
ownership of the trademark in question under the Trade
Mark Law. Exh. 5 is not acknowledged. Exh. 6 does not bear
the acknowledgment contemplated by the aforesaid law,
particularly by the last paragraph of section 37 and
paragraph 2 of section 31 of R.A. 166, as amended, which
provide as follows:
"The registration of a mark under the provisions of this
section shall be independent ef the, registration in the
country of origin and the duration, validity or transfer in the
Philippines of such registration shall be governed by the
provisions of this Act." (Sec. 37, last par.) (Italics ours)
"The assignment must be in writing, acknowledged before, a
notary public or other officer authorised to administer oaths
or perform other notarial acts and certified under the hand
and official seal of the notary or other officer." (Sec. 31, par.
2)
In this case, although a sheet of paper is attached to exh. 6,
on which is typewritten a certification that the signatures of
the presidents of the two named companies (referring to the
signatures in exh. 6) "have been duly written by themselves",
this sheet is unmarked, unpaged, unsigned, undated and
unsealed. We have thumbed the record in quest of any
definitive evidence that it is a correct translation of the
Japanese characters found on another unmarked and
unpaged sheet, and have found none.
It follows from the above disquisition that exhs. 5 and 6 are
legally insufficient to prove that the applicant is the owner of
the trademark in question.
As a matter of fact, the other evidence on record
conclusively belies the import of exh. 6. Thus exh. A states
that the applicant is merely the "exclusive distributor" in the
Philippines of the "LIONPAS" penetrative plaster; exh. A-1
describes the applicant as the "Philippine sole distributor" of
"LIONPAS"; exh. B simply states that "LIONPAS" is
"manufactured exclusively for Petra Hawpia& Co. for
distribution in the Philippines."
Not being the owner of the trademark "LIONPAS" but being
merely an importer and/or distributor of the said penetrative
plaster, the applicant is not entitled under the law to register
it in its name (Operators, Inc. vs. Director of Patents, supra).
Upon the third issue, the applicant preliminarily asserts that
there is no justification for this Court to disturb any finding
made by the Director of Patents on appeal. This assertion is
not tenable. Although the Director of Patents is the official
vested by law with the power to administer the registration of
trademarks and tradenames, his opinion on the matter of
similarity or dissimilarity of trademarks and tradenames is
not conclusive upon this Court which may pass upon such
determination.
The "SALONPAS" mark is not before this Court. Our
meticulous examination of the entire record has failed to
yield sample of such mark. We have therefore proceeded to
analyse the two marks, vis-a-vis each other, on the basis of
what we can derive from the record for a comparative study.
And our conclusion, in disagreement with that of the Director
of Patents, is not based on a comparison of the appearance,
form, style, shape, size or format of the trademarks, which
we can not make because, as we have already observed,
the "SALONPAS" mark is not before us, but on a
comparison of the spelling, sound and pronunciation of the
two words.
It is our considered view that the trademarks "SALONPAS"
and "LIONPAS" are confusingly similar in sound.
Both these words have the same suffix, "PAS", which is
used to denote a plaster that adhered to the body with
curative powers. "Pas, being merely descriptive, furnishes no
indication of the origin of the article and therefore is open for
appropriation by anyone (Ethepavs. Director of Patents, L-
20635, March 31, 1966) and may properly become the
subject of a trademark by combination with another word or
phrase.
Two letters of "SALONPAS" are missing in "LIONPAS": the
first letter a and the letter s. Be that as it may, when the two
words are pronounced, the sound effects are confusingly
similar. And where goods are advertised over the radio,
similarity in sound is of especial significance (Co Tiong Sa
vs. Director of Patents, 95 Phil. 1, citing Nims, The Law of
Unfair Competition and Trademarks, 4th ed., vol 2, pp. 676-
679). "The importance of this rule is emphasised by the
increase of radio advertising in which we are deprived of the
help of our eyes and must depend entirely on the ear"
(Operators, Inc. vs. Director of Patents, supra).
The following random list of confusingly similar sounds in the
matter of trademarks, culled from Nims, Unfair Competition
and Trade Marks, 1947, vol. 1, will reinforce our view that
"SALONPAS" and "LIONPAS" are confusingly similar in
sound: "Gold Dust" and "Gold Drop"; "Jantsen" amd "Jass-
Sea"; "Silver Flash" and "Supper-Flash"; "Cascarete" and
"Celborite"; "Celluloid" and "Cellonite"; "Chartreuse" and
"Charseurs"; "Cutex" and "Cuticlean"; "Hebe" and "Meje";
"Kotex" and "Femetex"; "Zuso" and "HooHoo". Leon Amdur,
in his book "Trade-Mark Law and Practice", pp. 419-421,
cites, as earning within the purview of the idem sonans rule,
"Yusea" and "U-C-A", "Steinway Pianos" and "Steinberg
Pianos", and "Seven-Up" and "Lemon-Up". In Co Tiong vs.
Director of Patents, this Court unequivocally said that
"Celdura" and "Cordura" are confusingly similar in sound;
this Court held in Sapolin Co. vs. Balmaceda, 67 Phil. 795
that the name "Lusolin" is an infringement of the trademark
"Sapolin", as the sound of the two names is almost the
same.
In the case at bar, "SALONPAS" and "LIONPAS", when
spoken, sound very much alike. Similarity of sound is
sufficient ground for this Court to rule that the two marks are
confusingly similar when applied to merchandise of the same
descriptive properties (see Celanese Corporation of America
vs. E. I. Du Pont, 154 F. 2d. 146, 148). The registration of
"LIONPAS" cannot therefore be given due course.
ACCORDINGLY, the decision of the respondent Director of
Patents is set aside, and the petition below of the
respondent Petra Hawpia& Co. is hereby dismissed, at the
cost of the latter respondent.
Concepcion, C.J., Reyes, J.B.L., Dizon, Regala, Makalintal,
Bengzon, J.P., Zaldivar and Sanchez, JJ., concur.
[ G.R. No. L-26557, February 18, 1970 ]
AMERICANWIRE& CABLE COMPANY, PETITIONER, VS.
DIRECTOR OF PATENTS AND CENTRAL BANAHAW
INDUSTRIES, RESPONDENTS.
DECISION
REYES, J.B.L., J.:
Appeal filed by the AmericanWire& Cable Company, owner
of the registered trademark DURAFLEX for electric wires,
questioning the correctness of the decision of the Director of
Patents (in Inter Partes Case No. 290) holding that the label
DYNAFLEX and Device for electric wires, sought to be
registered by the Central Banahaw Industries, Inc., is not
similar to herein appellant's patented mark.
On 2 June 1962, Central Banahaw Industries, Inc., applied
with the Director of Patents for registration of the trademark
DYNAFLEX and Device to be used in connection with
electric wires, class 20, which mark applicant allegedly had
been using since 29 March 1962. The AmericanWire and
Cable Co., Inc., another domestic corporation and
authorized user since 10 April 1958 of the registered trade
mark DURAFLEX and Globe representation, for electric
wires, apparatus, machines and supplies, class 20, opposed
the application on the ground that applicant's use of the
trademark DYNAFLEX would cause confusion or result in
mistakes to purchasers intending to buy DURAFLEX electric
wires and goods, the mark being registered allegedly having
practically the same spelling, pronunciation and sound, and
covering the same goods, as that of the opposer. Besides,
opposer contended that there has been no continuous use in
commerce of the applicant's mark.
After due hearing, the Director of Patents rendered decision
holding the applicant's mark DYNAFLEX not to be similar to
the previously registered trademark, DURAFLEX.
Consequently, the application of Central Banahaw Industries
for registration of DYNAFLEX was given due course and the
opposition thereto by American Wire& Cable Company
dismissed. The latter interposed the present appeal.
The issue to be resolved in this proceeding is simple:
whether or not the mark DYNAFLEX and Device is
registrable as label for electric wires, class 20, considering
that the trademark DURAFLEX and Globe representation,
also for electric wires, machines and supplies under class
20, has been registered more than 4 years earlier.
In ruling in favor of the herein application, the Director of
Patents said:
“x xxx The applicant's trademark is a composite mark
consisting of the word DYNAFLEX printed in small letters of
the English alphabet except that letter ‘D’ is capitalized,
within a fanciful device, on top of which is the encircled ini-
tials, in downward sequence, of the Respondent's corporate
name, and Jutting out on two sides of the circle are bolts of
lightning, symbolic of electricity.
"On the other hand, Opposer's trademark is DURAFLEX in
Capitalized print, except that one crosspiece of the letter X is
in the form of a bolt of lightning. The word slants slightly
upward, traversing the center of a figure of the earth or
globe.
“Resorting now to the semantics of the words, it is clear that
both marks are suffixed by the word FLEX. The word
appears in any dictionary having as common meaning 'to
bend'. In Webster's International Dictionary, it is used by the
British on electric cord. However, one mark (Respondent's)
is prefixed with DYNA suggesting power. It is not in itself a
rootword but it has been commonly associated with any
source of power. At most, it could have been derived from
the Greek word 'Dynamis' and, generally, the root words
commonly derived therefrom are 'dynam' and 'dynamo'. The
other (Opposer's) is prefixed with DURA, suggesting
durability, strength and endurance.
"Based on the foregoing comparisons, the trademarks of the
parties are different in appearance, meaning, sound and
connotation and hence, are not confusingly similar."
The pertinent law, Republic Act 166, as amended, on
registrability of trademarks, prescribes:
"SEC. 4. - The owner of a trademark, trade-name or service-
mark used to distinguish his goods, business or services
from the goods, business or services of others shall have the
right to register the same, unless it:
xxxxxxxxxx xxxxx
"(d) Consists of or comprises a mark or trade name which so
resembles a mark or trade-name registered in the
Philippines by another and not abandoned, as to be likely,
when applied to or used in connection with the goods,
business or services of the applicant, to cause confusion or
mistake or to deceive purchasers." (Underlining supplied)
It is clear from the above-quoted provision that the
determinative factor in a contest involving registration of
trade mark is not whether the challenged mark would
actually cause confusion or deception of the purchasers but
whether the use of such mark would likely cause confusion
or mistake on the part of the buying public. In short, to
constitute an infringement of an existing trademark patent
and warrant a denial of an application for registration, the
law does not require that the competing trademarks must be
so identical as to produce actual error or mistake; it would be
sufficient, for purposes of the law, that the similarity between
the two labels is such that there is a possibility or likelihood
of the purchaser of the older brand mistaking the newer
brand for it.
The question is, when is a trademark likely to confuse or
cause the public to mistake one for another? Earlier rulings
of the Court seem to indicate its reliance on the dominancy
test or the assessment of the essential or dominant features
in the competing labels to determine whether they are
confusingly similar.[1] On this matter, the Court said:
"It has been consistently held that the question of
infringement of a trademark is to be determined by the test
of dominancy. Similarity in size, form, and color, while
relevant, is not conclusive. If the competing trademark
contains the main or essential or dominant features of
another, and confusion and deception is likely to result,
infringement takes place. Duplication or imitation is not
necessary, nor is it necessary that the infringing label should
suggest an effort to imitate. (C. Neilman Brewing Co. vs.
Independent Brewing Co., 191 F. 489, 495, citing Eagle
White Lead Co. vs. Pflugh [CC] 180 Fed. 579). The question
at issue in cases of infringement of trademarks is whether
the use of the marks involved would be likely to cause
confusion or mistakes in the mind of the public or deceive
purchasers." (Go Tiongvs. Director of Patents, 95 Phil. 1,
cited in Lim Hoavs. Director of Patents, 100 Phil. 214).[2]
In fact, even their similarity in sound is taken into
consideration, where the marks refer to merchandise of the
same descriptive properties, for the reason that trade idem
sonans constitutes a violation of trade mark patents.[3] Thus,
in the case of Marvex Commercial Co. vs. Hawpia& Co.,[4]
the registration of the trademark "Lionpas" for medicated
plaster was denied for being confusingly similar in sound
with "Salonpas", a registered mark also for medicated
plaster, the Court saying:
"Two letters of 'SALONPAS' are missing in 'LIONPAS', the
first letter a and the letter s. Be that as it may, when the two
words are pronounced, the sound effects are confusingly
similar. And where goods are advertised over the radio,
similarity in sound is of especial significance (Co Tiong Sa
vs. Director of Patents, 95 Phil. 1, citing Nims, The Law of
Unfair Competition and Trademarks, 4th ed., vol. 2, pp. 678-
679). 'The importance of this rule is emphasized by the
increase of radio advertising in which we are deprived of
help of our eyes and must depend entirely on the ear'
(Operators, Inc. vs. Director of Patents, supra.)"
Along the same line are the rulings denying registration of a
mark containing the picture of a fish (Bangus), as label for
soy sauce, for being similar to another registered brand of
soy sauce that bears the picture of the fish carp;[5] or that of
the mark bearing the picture of two roosters with the word
"Bantam", as label for food seasoning (vetsin), which would
confuse the purchasers of the same article bearing the
registered mark "Hen Brand" that features the picture of a
hen.[6]
The present case is governed by the principles laid down in
the preceding cases. The similarity between the competing
trademarks, DURAFLEX and DYNAFLEX, is apparent. Not
only are the initial letters and the last half of the appellations
identical, but the difference exists only in two out of the eight
literal elements of the designations. Coupled with the fact
that both marks cover insulated flexible wires under class 20;
that both products are contained in boxes of the same
material, color, shape and size; that the dominant elements
of the front designs are a red circle and a diagonal zigzag
commonly related to a spark or flash of electricity; that the
back of both boxes show similar circles of broken lines with
arrows at the center pointing outward, with the identical
legend "Cut Out Ring" "Draw From Inside Circle", no
difficulty is experienced in reaching the conclusion that there
is a deceptive similarity that would lead the purchaser to
confuse one product with the other.
The Director of Patents has predicated his decision mostly
on the semantic difference and connotation of the prefixes
"Dura" and "Dyna" of the competing trademarks,
unfortunately forgetting that the buyers are less concerned
with the etymology of the words as with their sound and the
dominant features of the design.
Of course, as pointed out in the decision now on appeal,
there are some differences in the mark on the front portion of
the box. But they pale into insignificance in view of the close
resemblance in the general appearance of the box and the
tradenames of the articles. Indeed, measured against the
dominant-feature standard, applicant's mark must be
disallowed. For, undeniably, the dominant and essential
feature of the article is the trademark itself. Unlike in the
case of commodities that are ordinarily picked up by the
purchaser himself from the grocery or market counters,
electric wires are purchased not by their appearance but by
the size (voltage) and length and, most importantly, by
brand. It is even within layman's knowledge that different
brands of wire have different characteristics and properties;
and for an essential building item as electric wires and
supplies, the owner of the building would not dare risk his
property, perhaps his life, on an unknown or untested brand.
He would only demand for what is recognized to be the best.
Relying on the doctrine enunciated in the Etepha case[7] and
the earlier ruling in Lim Hoavs. Director of Patents,[8]
applicant-appellee contends that the DYNAFLEX mark
would not confuse or deceive the buyers and subscribers of
the DURAFLEX brand, because electrical wires are of great
value and the purchasers thereof are generally intelligent -
the architects, engineers and building contractors. It must
be realized, however, that except perhaps in big
constructions, the designing architect or engineer, or the
contractor who will undertake the work of building, does not
himself purchase or place the order for the purchase of the
materials to be used therein. The task is oftentimes
delegated to another. Nor are said technical men the ones
personally laying down the wiring system in the building that
they could possibly check on whether or not the correct
wires are being used. So that even if the engineer or
contractor will specify in the bill of materials the particular
brand of wires needed, there is no certainty that the desired
product will be acquired. For, unlike the pharmacists or
druggists, the dispensers of hardware or electrical supplies
are not generally known to pay as much concern to the
brand of articles asked for by the customer and of a person
who knows the name of the brand but is not acquainted with
its appearance, the likelihood of the DYNAFLEX product
being mistaken for DURAFLEX is not remote.
Of course, as in all other cases of colorable imitations, the
unanswered riddle is why, of the millions of terms and
combinations of letters and designs available, the appellee
had to choose those so closely similar to another's
trademark if there was no intent to take advantage of the
goodwill generated by the other mark.
FOR THE FOREGOING CONSIDERATIONS, the decision
appealed from is hereby set aside, and the application for
registration of the trademark DYNAFLEX for electric wires,
class 20, is ordered denied. No costs.
[ G.R. No. L-27906, January 08, 1987 ]
CONVERSE RUBBER CORPORATION, PETITIONER, VS.
UNIVERSAL RUBBER PRODUCTS, INC. AND TIBURCIO
S. EVALLE, DIRECTOR OF PATENTS, RESPONDENTS.
RESOLUTION
FERNAN, J.:
The undisputed facts of the case are as follows:
Respondent Universal Rubber Products, Inc. filed an
application with the Philippine Patent office for registration of
the trademark "UNIVERSAL CONVERSE AND DEVICE"
used on rubber shoes and rubber slippers.
Petitioner Converse Rubber Corporation filed its opposition
to the application for registration on grounds that:
a) The trademark sought to be registered is confusingly
similar to the word "CONVERSE" which is part of petitioner's
corporate name "CONVERSE RUBBER CORPORATION"
as to likely deceive purchasers of products on which it is to
be used to an extent that said products may be mistaken by
the unwary public to be manufactured by the petitioner; and,
b) The registration of respondent's trademark will cause
great and irreparable injury to the business reputation and
goodwill of petitioner in the Philippines and would cause
damage to said petitioner within the meaning of Section 8,
R.A. No. 166, as amended.
Thereafter, respondent filed its answer and at the pre-trial,
the parties submitted the following partial stipulation of facts:
“1) The petitioner's corporate name is 'CONVERSE
RUBBER CORPORATION' and has been in existence since
July 31, 1946; it is duly organized under the laws of
Massachusetts, USA and doing business at 392 Pearl St.,
Malden, County of Middlesex, Massachusetts;
2) Petitioner is not licensed to do business in the
Philippines and it is not doing business on its own in the
Philippines; and,
3) Petitioner manufactures rubber shoes and uses thereon
the trademarks'CHUCK TAYLOR' and 'ALL STAR
ANDDEVICE'.[1]
At the trial, petitioner's lone witness, Mrs. Carmen B.
Pacquing, a duly licensed private merchant with stores at the
Sta. Mesa Market and in Davao City, testified that she had
been selling CONVERSE rubber shoes in the local market
since 1956 and that sales of petitioner's rubber shoes in her
stores averaged twelve to twenty pairs a month purchased
mostly by basketball players of local private educational
institutions like Ateneo, La Salle and San Beda.
Mrs. Pacquing, further stated that she knew petitioner's
rubber shoes came from the United States "because it says
there in the trademark Converse Chuck Taylor with star red
or blue and is a round figure and made in U.S.A."[2] In the
invoices issued by her store, the rubber shoes were
described as "Converse Chuck Taylor"[3], "Converse All
Star"[4], "All Star Converse Chuck Taylor"[5], or "Converse
Shoes Chuck Taylor"[6]. She also affirmed that she had no
business connection with the petitioner.
Respondent, on the other hand, presented as its lone
witness the secretary of said corporation who testified that
respondent has been selling on wholesale basis "Universal
Converse" sandals since 1962 and "Universal Converse"
rubber shoes since 1963. Invoices were submitted as
evidence of such sales. The witness also testified that she
had no idea why respondent chose "Universal Converse" as
a trademark and that she was unaware of the name
"Converse" prior to her corporation's sale of "Universal
Converse" rubber shoes and rubber sandals.
Eventually, the Director of Patents dismissed the opposition
of the petitioner and gave due course to respondent's
application. His decision reads in part:
"xxx the only question for determination is whether or not the
applicant's partial appropriation of the Opposer's
[petitioner's] corporate name is of such character that in this
particular case, it is calculated to deceive or confuse the
public to the injury of the corporation to which the name
belongs…
....I cannot find anything that will prevent registration of the
word 'UNIVERSAL CONVERSE' in favor, of the respondent.
In arriving at this conclusion, I am guided by the fact that the
opposer failed to present proof that the single word
"CONVERSE' in its corporate name has become so
identified with the corporation that whenever used, it
designates to the mind of the public that particular
corporation.
The proofs herein are sales made by a single witness who
had never dealt with the petitioner . . . the entry of
Opposer's [petitioner's] goods in the Philippines were not
only effected in a very insignificant quantity but without the
opposer [petitioner] having a direct or indirect hand in the
transaction so as to be made the basis for trademark pre-
emption.
Opposer's proof of its corporate personality cannot establish
the use of the word 'CONVERSE' in any sense, as it is
already stipulated that it is not licensed to do business in the
Philippines, and is not doing business of its own in the
Philippines. If so, it will be futile for it to establish that
'CONVERSE' as part of its corporate name identifies its
rubber shoes. Besides, it was also stipulated that opposer
[petitioner], in manufacturing rubber shoes uses thereon the
trademark 'CHUCK TAYLOR' and 'ALL STAR and DEVICE'
and none other.
Furthermore, inasmuch as the Opposer never presented any
label herein, or specimen of its shoes, whereon the label
may be seen, notwithstanding its witness' testimony touching
upon her identification of the rubber shoes sold in her stores,
no determination can be made as to whether the word
'CONVERSE' appears thereon.
... the record is wanting in proof to establish likelihood of
confusion so as to cause probable damage to the Opposer
."[7]
Its motion for reconsideration having been denied by the
respondent Director of Patents, petitioner instituted the
instant petition for review.
As correctly phrased by public respondent Director of
Patents, the basic issue presented for our consideration is
whether or not the respondent's partial appropriation of
petitioner's corporate name is of such character that it is
calculated to deceive or confuse the public to the injury of
the petitioner to which the name belongs.
"A trade name is any individual name or surname, firm
name, device or word used by manufacturers, industrialists,
merchants and others to identify their businesses, vocations
or occupations".[8] "As the trade name refers to the business
and its goodwill x xx the trademark refers to the goods".[9]
The ownership of a trademark or tradename is a property
right which the owner is entitled to protect "since there is
damage to him from confusion or reputation or goodwill in
the mind of the public as well as from confusion of goods.
The modern trend is to give emphasis to the unfairness of
the acts and to classify and treat the issue as fraud".[10]
From a cursory appreciation of the petitioner's corporate
name "CONVERSE RUBBER CORPORATION', it is evident
that the word "CONVERSE" is the dominant word which
identifies petitioner from other corporations engaged in
similar business. Respondent, in the stipulation of facts,
admitted petitioner's existence since 1946 as a duly
organized foreign corporation engaged in the manufacture of
rubber shoes. This admission necessarily betrays its
knowledge of the reputation and business of petitioner even
before it applied for registration of the trademark in
question. Knowing, therefore, that the word "CONVERSE"
belongs to and is being used by petitioner, and is in fact the
dominant word in petitioner's corporate name, respondent
has no right to appropriate the same for use on its products
which are similar to those being produced by petitioner.
"A corporation is entitled to the cancellation of a mark that is
confusingly similar to its corporate name".[11] "Appropriation
by another of the dominant part of a corporate name is an
infringement".[12]
Respondent's witness had no idea why respondent chose
"UNIVERSAL CONVERSE" as trademark and the record
discloses no reasonable explanation for respondent's use of
the word "CONVERSE" in its trademark. Such unexplained
use by respondent of the dominant word of petitioner's
corporate name lends itself open to the suspicion of
fraudulent motive to trade upon petitioner's reputation, thus:
"A boundless choice of words, phrases and symbols is
available to one who wishes a trademark sufficient unto itself
to distinguish his product from those of others. When,
however, there is no reasonable explanation for the
defendant's choice of such a mark though the field for his
selection was so broad, the inference is inevitable that it was
chosen deliberately to deceive."[13]
The testimony of petitioner's witness, who is a legitimate
trader as well as the invoices evidencing sales of petitioner's
products in the Philippines, give credence to petitioner's
claim that it has earned a business reputation and goodwill
in this country. The sales invoices submitted by petitioner's
lone witness show that it is the word "CONVERSE" that
mainly identifies petitioner's products, i.e. "CONVERSE
CHUCK TAYLOR",[14] "CONVERSE ALL STAR",[15] "ALL
STAR CONVERSE CHUCK TAYLOR",[16] or "CONVERSE
SHOES CHUCK and TAYLOR".[17] Thus, contrary to the
determination of the respondent Director of Patents, the
word "CONVERSE" has grown to be identified with
petitioner's products, and in this sense, has acquired a
second meaning within the context of trademark and
tradename laws.
Furthermore, said sales invoices provide the best proof that
there were actual sales of petitioner's products in the country
and that there was actual use for a protracted period of
petitioner's trademark or part thereof through these sales.
"The most convincing proof of use of a mark in commerce is
testimony of such witnesses as customers, or the orders of
buyers during a certain period."[18] Petitioner's witness,
having affirmed her lack of business connections with
petitioner, has testified as such customer, supporting
strongly petitioner's move for trademark pre-emption.
The sales of 12 to 20 pairs a month of petitioner's rubber
shoes cannot be considered insignificant, considering that
they appear to be of high expensive quality, which not too
many basketball players can afford to buy. Any sale made
by a legitimate trader from his store is a commercial act
establishing trademark rights since such sales are made in
due course of business to the general public, not only to
limited individuals. It is a matter of public knowledge that all
brands of goods filter into the market, indiscriminately sold
by jobbers, dealers and merchants not necessarily with the
knowledge or consent of the manufacturer. Such actual sale
of goods in the local market establishes trademark use
which serves as the basis for any action aimed at trademark
pre-emption. It is a corollary logical deduction that while
Converse Rubber Corporation is not licensed to do business
in the country and is not actually doing business here, it
does not mean that its goods are not being sold here or that
it has not earned a reputation or goodwill as regards its
products. The Director of Patents was, therefore, remiss in
ruling that the proofs of sales presented "was made by a
single witness who had never dealt with nor had never
known opposer [petitioner] x xx without Opposer having a
direct or indirect hand in the transaction to be the basis of
trademark pre-emtpion."
Another factor why respondent's application should be
denied is the confusing similarity between its trademark
"UNIVERSAL CONVERSE AND DEVICE" and petitioner's
corporate name and/or its trademarks "CHUCK TAYLOR"
and "ALL STAR DEVICE" which could confuse the
purchasing public to the prejudice of petitioner.
The trademark of respondent "UNIVERSAL CONVERSE
and DEVICE" is imprinted in a circular manner on the side of
its rubber shoes. In the same manner, the trademark of
petitioner which reads "CONVERSE CHUCK TAYLOR" is
imprinted on a circular base attached to the side of its rubber
shoes.
The determinative factor in ascertaining whether or not
marks are confusingly similar to each other "is not whether
the challenged mark would actually cause confusion or
deception of the purchasers but whether the use of such
mark would likely cause confusion or mistake on the part of
the buying public. It would be sufficient, for purposes of the
law, that the similarity between the two labels is such that
there is a possibility or likelihood of the purchaser of the
older brand mistaking the new brand for it."[19] Even if not all
the details just mentioned were identical, with the general
appearance alone of the two products, any ordinary, or even
perhaps even [sic] a not too perceptive and discriminating
customer could be deceived x xx."[20]
When the law speaks of "purchaser", the reference is to
ordinary average purchasers.[21] "It is not necessary in either
case that the resemblance be sufficient to deceive experts,
dealers, or other persons specially familiar with the
trademark or goods involved."[22]
The similarity in the general appearance of respondent's
trademark and that of petitioner would evidently create a
likelihood of confusion among the purchasing public. But
even assuming, arguendo, that the trademark sought to be
registered by respondent is distinctively dissimilar from those
of the petitioner, the likelihood of confusion would still
subsist, not on the purchaser's perception of the goods but
on the origins thereof. By appropriating the word
"CONVERSE", respondent's products are likely to be
mistaken as having been produced by petitioner. "The risk
of damage is not limited to a possible confusion of goods but
also includes confusion of reputation if the public could
reasonably assume that the goods of the parties originated
from the same source.[23]
It is unfortunate that respondent Director of Patents has
concluded that since the petitioner is not licensed to do
business in the country and is actually not doing business on
its own in the Philippines, it has no name to protect in the
forum and thus, it is futile for it to establish that
"CONVERSE" as part of its corporate name identifies its
rubber shoes. That a foreign corporation has a right to
maintain an action in the forum even if it is not licensed to do
business and is not actually doing business on its own
therein has been enunciated many times by this Court. In La
Chemise Lacoste, S.A. vs. Fernandez, 129 SCRA 373, this
Court, reiterating Western Equipment and Supply Co. vs.
Reyes, 51 Phil. 115, stated that:
"x xx a foreign corporation which has never done any
business in the Philippines and which is unlicensed and
unregistered to do business here, but is widely and favorably
known in the Philippines through the use therein of its
products bearing its corporate and tradename, has a legal
right to maintain an action in the Philippines to restrain the
residents and inhabitants thereof from organizing a
corporation therein bearing the same name as the foreign
corporation, when it appears that they have personal
knowledge of the existence of such a foreign corporation,
and it is apparent that the purpose of the proposed domestic
corporation is to deal and trade in the same goods as those
of the foreign corporation.
"We further held:
xxx xxx xxx
xxx xxx xxx
" ' That company is not here seeking to enforce any legal on
control rights arising from, or growing out of, any business
which it has transacted in the Philippine lslands. The sole
purpose of the action:
" 'Is to protect its reputation, its corporate name, its goodwill,
whenever that reputation, corporate name or goodwill have,
through the natural development of its trade, established
themselves.' And it contends that its rights to the use of its
corporate and trade name:
" 'Is a property right, a right in rem, which it may assert and
protect against all the world, in any of the courts of the world
— even in jurisdictions where it does not transact business
— just the same as it may protect its tangible property, real
or personal, against trespass, or conversion. Citing sec, 10,
Nims on Unfair Competition and Trademarks and cases
cited; secs. 21-22, Hopkins on Trademarks, Trade Names "Tradenames of persons described in the first paragraph of
and Unfair Competition and cases cited.' That point is this section shall be protected without the obligation of filing
sustained by the authorities, and is well stated in Hanover or registration whether or not they form parts of marks.
Star Mining Co. vs. Allen and Wheeler Co. [208 Fed., 513], "[underscoring supplied.]
in which the syllabus says:
WHEREFORE, the decision of the Director of Patents is
" 'Since it is the trade and not the mark that is to be hereby set aside and a new one entered denying
protected, a trademark acknowledges no territorial Respondent Universal Rubber Products, Inc.'s application for
boundaries of municipalities or states or nations, but extends registration of the trademark "UNIVERSAL CONVERSE
to every market where the trader's goods have become AND DEVICE" on its rubber shoes and slippers.
known and identified by the use of the mark.' "
SO ORDERED.
The ruling in the aforecited case is in consonance with the
Convention of the Union of Paris for the Protection of
Industrial Property to which the Philippines became a party
on September 27, 1965. Article 8 thereof provides that "a
trade name [corporate name] shall be protected in all the
countries of the Union without the obligation of filing or
registration, whetheror not it forms partof the trademark".
[underscoring supplied]

The object of the Convention is to accord a national of a

member nation extensive protection "against infringement
and other types of unfair competition" [Vanitary Fair Mills,
Inc. vs. T. Eaton Co., 234 F. 2d 633].

The mandate of the aforementioned Convention finds

implementation in Sec. 37 of RA No. 166, otherwise known
as the Trademark Law:

"Sec. 37. Rights of Foreign Registrants.- Persons who are

nationals of, domiciled in, or have a bona fide or effective
business or commercial establishment in any foreign
country, which is a party to an international convention or
treaty relating to marks or tradenames on the repression of
unfair competition to which the Philippines may be a party,
shall be entitled to the benefits and subject to the provisions
of this Act… x xx
 [ G.R. No. 164321, March 23, 2011 ]
SKECHERS, U.S.A., INC., PETITIONER, VS. INTER
PACIFIC INDUSTRIAL TRADING CORP., AND/OR INTER
PACIFIC TRADING CORP. AND/OR STRONG SPORTS
GEAR CO., LTD., AND/OR STRONGSHOES WAREHOUSE
AND/OR STRONG FASHION SHOES TRADING AND/OR
TAN TUAN HONG AND/OR VIOLETA T. MAGAYAGA
AND/OR JEFFREY R. MORALES AND/OR ANY OF ITS
OTHER PROPRIETOR/S, DIRECTORS, OFFICERS,
EMPLOYEES AND/OR OCCUPANTS OF ITS PREMISES
LOCATED AT S-7, ED & JOE'S COMMERCIAL ARCADE,
NO. 153 QUIRINO AVENUE, PARAÑAQUE CITY,
RESPONDENTS.
TRENDWORKS INTERNATIONAL CORPORATION,
PETITIONER-INTERVENOR, VS. INTER PACIFIC
INDUSTRIAL TRADING CORP. AND/OR INTER PACIFIC
TRADING CORP. AND/OR STRONG SPORTS GEAR CO.,
LTD., AND/OR STRONGSHOES WAREHOUSE AND/OR
STRONG FASHION SHOES TRADING AND/OR TAN
TUAN HONG AND/OR VIOLETA T. MAGAYAGA AND/OR
JEFFREY R. MORALES AND/OR ANY OF ITS OTHER
PROPRIETOR/S, DIRECTORS, OFFICERS, EMPLOYEES
AND/OR OCCUPANTS OF ITS PREMISES LOCATED AT
S-7, ED & JOE'S COMMERCIAL ARCADE, NO. 153
QUIRINO AVENUE, PARAÑAQUE CITY, RESPONDENTS.
RESOLUTION
PERALTA, J.:
For resolution are the twin Motions for Reconsideration[1]
filed by petitioner and petitioner-intervenor from the Decision
rendered in favor of respondents, dated November 30, 2006.
At the outset, a brief narration of the factual and procedural
antecedents that transpired and led to the filing of the
motions is in order.
The present controversy arose when petitioner filed with
Branch 24 of the Regional Trial Court (RTC) of Manila an
application for the issuance of search warrants against an
outlet and warehouse operated by respondents for
infringement of trademark under Section 155, in relation to
Section 170 of Republic Act No. 8293, otherwise known as
the Intellectual Property Code of the Philippines.[2] In the
course of its business, petitioner has registered the
trademark "SKECHERS"[3] and the trademark "S" (within an
oval design)[4] with the Intellectual Property Office (IPO).
Two search warrants[5] were issued by the RTC and were
served on the premises of respondents. As a result of the
raid, more than 6,000 pairs of shoes bearing the "S" logo
were seized.
Later, respondents moved to quash the search warrants,
arguing that there was no confusing similarity between
petitioner's "Skechers" rubber shoes and its "Strong" rubber
shoes.
On November 7, 2002, the RTC issued an Order[6] quashing
the search warrants and directing the NBI to return the
seized goods. The RTC agreed with respondent's view that
Skechers rubber shoes and Strong rubber shoes have
glaring differences such that an ordinary prudent purchaser
would not likely be misled or confused in purchasing the
wrong article.
Aggrieved, petitioner filed a petition for certiorari[7] with the
Court of Appeals (CA) assailing the RTC Order. On
November 17, 2003, the CA issued a Decision[8] affirming
the ruling of the RTC.

Subsequently, petitioner filed the present petition[9]
before
this Court which puts forth the following assignment of
errors:
A. WHETHER THE COURT OF APPEALS
COMMITTED GRAVE ABUSE OF DISCRETION IN
CONSIDERING MATTERS OF DEFENSE IN A
CRIMINAL TRIAL FOR TRADEMARK
INFRINGEMENT IN PASSING UPON THE VALIDITY
OF THE SEARCH WARRANT WHEN IT SHOULD
HAVE LIMITED ITSELF TO A DETERMINATION OF
WHETHER THE TRIAL COURT COMMITTED
GRAVE ABUSE OF DISCRETION IN QUASHING
THE SEARCH WARRANTS.
B. WHETHER THE COURT OF APPEALS
COMMITTED GRAVE ABUSE OF DISCRETION IN
FINDING THAT RESPONDENTS ARE NOT GUILTY
OF TRADEMARK INFRINGEMENT IN THE CASE
WHERE THE SOLE TRIABLE ISSUE IS THE
EXISTENCE OF PROBABLE CAUSE TO ISSUE A
SEARCH WARRANT.[10]
In the meantime, petitioner-intervenor filed a Petition-in-
Intervention[11] with this Court claiming to be the sole
licensed distributor of Skechers products here in the
Philippines.
On November 30, 2006, this Court rendered a Decision[12]
dismissing the petition.
Both petitioner and petitioner-intervenor filed separate
motions for reconsideration.
In petitioner's motion for reconsideration, petitioner moved
for a reconsideration of the earlier decision on the following
grounds:
(a) THIS HONORABLE COURT MUST RE-EXAMINE THE
FACTS OF THIS CASE DUE TO THE SIGNIFICANCE AND
REPERCUSSIONS OF ITS DECISION.
(b) COMMERCIAL QUANTITIES OF THE SEIZED ITEMS
WITH THE UNAUTHORIZED REPRODUCTIONS OF THE
"S" TRADEMARK OWNED BY PETITIONER WERE
INTENDED FOR DISTRIBUTION IN THE PHILIPPINE
MARKET TO THE DETRIMENT OF PETITIONER -
RETURNING THE GOODS TO RESPONDENTS WILL
ADVERSELY AFFECT THE GOODWILL AND
REPUTATION OF PETITIONER.
(c) THE SEARCH WARRANT COURT AND THE COURT
OF APPEALS BOTH ACTED WITH GRAVE ABUSE OF
DISCRETION.
(d) THE SEARCH WARRANT COURT DID NOT
PROPERLY RE-EVALUATE THE EVIDENCE PRESENTED
DURING THE SEARCH WARRANT APPLICATION
PROCEEDINGS.
(e) THE SOLID TRIANGLE CASE IS NOT APPLICABLE IN
THIS CASE, AS IT IS BASED ON A DIFFERENT FACTUAL
MILIEU. PRELIMINARY FINDING OF GUILT (OR
ABSENCE THEREOF) MADE BY THE SEARCH
WARRANT COURT AND THE COURT OF APPEALS WAS
IMPROPER.
(f) THE SEARCH WARRANT COURT OVERSTEPPED ITS
DISCRETION. THE LAW IS CLEAR. THE DOMINANCY
TEST SHOULD BE USED.
(g) THE COURT OF APPEALS COMMITTED ERRORS OF
JURISDICTION.[13]
On the other hand, petitioner-intervenor's motion for
reconsideration raises the following errors for this Court's
consideration, to wit:
(a) THE COURT OF APPEALS AND THE SEARCH
WARRANT COURT ACTED CONTRARY TO LAW AND
JURISPRUDENCE IN ADOPTING THE ALREADY-
REJECTED HOLISTIC TEST IN DETERMINING THE
ISSUE OF CONFUSING SIMILARITY;
(b) THE COURT OF APPEALS AND THE SEARCH
WARRANT COURT ACTED CONTRARY TO LAW IN
HOLDING THAT THERE IS NO PROBABLE CAUSE FOR
TRADEMARK INFRINGEMENT; AND
(c) THE COURT OF APPEALS SANCTIONED THE TRIAL
COURT'S DEPARTURE FROM THE USUAL AND
ACCEPTED COURSE OF JUDICIAL PROCEEDINGS
WHEN IT UPHELD THE QUASHAL OF THE SEARCH
WARRANT ON THE BASIS SOLELY OF A FINDING THAT
THERE IS NO CONFUSING SIMILARITY.[14]
A perusal of the motions submitted by petitioner and
petitioner-intervenor would show that the primary issue
posed by them dwells on the issue of whether or not
respondent is guilty of trademark infringement.
After a thorough review of the arguments raised herein, this
Court reconsiders its earlier decision.
The basic law on trademark, infringement, and unfair
competition is Republic Act (R.A.) No. 8293. Specifically,
Section 155 of R.A. No. 8293 states:
Remedies; Infringement. -- Any person who shall, without
the consent of the owner of the registered mark:
155.1. Use in commerce any reproduction, counterfeit, copy,
or colorable imitation of a registered mark or the same
container or a dominant feature thereof in connection with
the sale, offering for sale, distribution, advertising of any
goods or services including other preparatory steps
necessary to carry out the sale of any goods or services on
or in connection with which such use is likely to cause
confusion, or to cause mistake, or to deceive; or
155.2. Reproduce, counterfeit, copy or colorably imitate a
registered mark or a dominant feature thereof and apply
such reproduction, counterfeit, copy or colorable imitation to
labels, signs, prints, packages, wrappers, receptacles or
advertisements intended to be used in commerce upon or in
connection with the sale, offering for sale, distribution, or
advertising of goods or services on or in connection with
which such use is likely to cause confusion, or to cause
mistake, or to deceive, shall be liable in a civil action for
infringement by the registrant for the remedies hereinafter
set forth: Provided, That the infringement takes place at the
moment any of the acts stated in Subsection 155.1 or this
subsection are committed regardless of whether there is
actual sale of goods or services using the infringing
material.[15]
The essential element of infringement under R.A. No. 8293
is that the infringing mark is likely to cause confusion. In
determining similarity and likelihood of confusion,
jurisprudence has developed tests ? the Dominancy Test
and the Holistic or Totality Test. The Dominancy Test
focuses on the similarity of the prevalent or dominant
features of the competing trademarks that might cause
confusion, mistake, and deception in the mind of the
purchasing public. Duplication or imitation is not necessary;
neither is it required that the mark sought to be registered
suggests an effort to imitate. Given more consideration are
the aural and visual impressions created by the marks on the
buyers of goods, giving little weight to factors like prices,
quality, sales outlets, and market segments.[16]
In contrast, the Holistic or Totality Test necessitates a
consideration of the entirety of the marks as applied to the
products, including the labels and packaging, in determining
confusing similarity. The discerning eye of the observer must
focus not only on the predominant words, but also on the
other features appearing on both labels so that the observer
may draw conclusion on whether one is confusingly similar
to the other.[17]
Relative to the question on confusion of marks and trade
names, jurisprudence has noted two (2) types of confusion,
viz.: (1) confusion of goods (product confusion), where the
ordinarily prudent purchaser would be induced to purchase
one product in the belief that he was purchasing the other;
and (2) confusion of business (source or origin confusion),
where, although the goods of the parties are different, the
product, the mark of which registration is applied for by one
party, is such as might reasonably be assumed to originate
with the registrant of an earlier product, and the public would
then be deceived either into that belief or into the belief that
there is some connection between the two parties, though
inexistent.[18]
Applying the Dominancy Test to the case at bar, this Court
finds that the use of the stylized "S" by respondent in its
Strong rubber shoes infringes on the mark already registered
by petitioner with the IPO. While it is undisputed that
petitioner's stylized "S" is within an oval design, to this
Court's mind, the dominant feature of the trademark is the
stylized "S," as it is precisely the stylized "S" which catches
the eye of the purchaser. Thus, even if respondent did not
use an oval design, the mere fact that it used the same
stylized "S", the same being the dominant feature of
petitioner's trademark, already constitutes infringement
under the Dominancy Test.
This Court cannot agree with the observation of the CA that
the use of the letter "S" could hardly be considered as highly
identifiable to the products of petitioner alone. The CA even
supported its conclusion by stating that the letter "S" has
been used in so many existing trademarks, the most popular
of which is the trademark "S" enclosed by an inverted
triangle, which the CA says is identifiable to Superman. Such
reasoning, however, misses the entire point, which is that
respondent had used a stylized "S," which is the same
stylized "S" which petitioner has a registered trademark for.
The letter "S" used in the Superman logo, on the other hand,
has a block-like tip on the upper portion and a round
elongated tip on the lower portion. Accordingly, the
comparison made by the CA of the letter "S" used in the
Superman trademark with petitioner's stylized "S" is not
appropriate to the case at bar.
Furthermore, respondent did not simply use the letter "S,"
but it appears to this Court that based on the font and the
size of the lettering, the stylized "S" utilized by respondent is
the very same stylized "S" used by petitioner; a stylized "S"
which is unique and distinguishes petitioner's trademark.
Indubitably, the likelihood of confusion is present as
purchasers will associate the respondent's use of the
stylized "S" as having been authorized by petitioner or that
respondent's product is connected with petitioner's business.
Both the RTC and the CA applied the Holistic Test in ruling
that respondent had not infringed petitioner's trademark. For
its part, the RTC noted the following supposed dissimilarities
between the shoes, to wit:
1. The mark "S" found in Strong Shoes is not enclosed
in an "oval design."
2. The word "Strong" is conspicuously placed at the
backside and insoles.
3. The hang tags and labels attached to the shoes bears
the word "Strong" for respondent and "Skechers
U.S.A." for private complainant;
4. Strong shoes are modestly priced compared to the
costs of Skechers Shoes.[19]
While there may be dissimilarities between the appearances
of the shoes, to this Court's mind such dissimilarities do not
outweigh the stark and blatant similarities in their general
features. As can be readily observed by simply comparing
petitioner's Energy[20] model and respondent's Strong[21]
rubber shoes, respondent also used the color scheme of
blue, white and gray utilized by petitioner. Even the design
and "wavelike" pattern of the midsole and outer sole of
respondent's shoes are very similar to petitioner's shoes, if
not exact patterns thereof. At the side of the midsole near
the heel of both shoes are two elongated designs in
practically the same location. Even the outer soles of both
shoes have the same number of ridges, five at the back and
six in front. On the side of respondent's shoes, near the
upper part, appears the stylized "S," placed in the exact
location as that of the stylized "S" on petitioner's shoes. On
top of the "tongue" of both shoes appears the stylized "S" in
practically the same location and size. Moreover, at the back
of petitioner's shoes, near the heelcounter, appears
"Skechers Sport Trail" written in white lettering. However, on
respondent's shoes appears "Strong Sport Trail" noticeably
written in the same white lettering, font size, direction and
orientation as that of petitioner's shoes. On top of the heel
collar of petitioner's shoes are two grayish-white semi-
transparent circles. Not surprisingly, respondent's shoes also
have two grayish-white semi-transparent circles in the exact
same location.
Based on the foregoing, this Court is at a loss as to how the
RTC and the CA,in applying the holistic test,ruled that there
was no colorable imitation, when it cannot be any more clear
and apparent to this Court that there is colorable
imitation.The dissimilarities between the shoes are too trifling
and frivolousthat it is indubitable that respondent's products
will cause confusion and mistake in the eyes of the public.
Respondent's shoes may not be an exact replica of
petitioner's shoes, but the features andoverall design are so
similar and alike that confusion is highly likely.
In Converse Rubber Corporation v. Jacinto Rubber & Plastic
Co., Inc.,[22] this Court, in a case for unfair competition, had
opined that even if not all the details are identical, as long as
the general appearance of the two products are such that
any ordinary purchaser would be deceived, the imitator
should be liable, to wit:
From said examination, We find the shoes manufactured by
defendants to contain, as found by the trial court, practically
all the features of those of the plaintiff Converse Rubber
Corporation and manufactured, sold or marketed by plaintiff
Edwardson Manufacturing Corporation, except for their
respective brands, of course. We fully agree with the trial
court that "the respective designs, shapes, the colors of the
ankle patches, the bands, the toe patch and the soles of the
two products are exactly the same ... (such that) at a
distance of a few meters, it is impossible to distinguish
"Custombuilt" from "Chuck Taylor." These elements are
more than sufficient to serve as basis for a charge of unfair
competition. Even if not all the details just mentioned were
identical, with the general appearances alone of the two
products, any ordinary, or even perhaps even a not too
perceptive and discriminating customer could be deceived,
and, therefore, Custombuilt could easily be passed off for
Chuck Taylor. Jurisprudence supports the view that under
such circumstances, the imitator must be held liable. x x x[23]
Neither can the difference in price be a complete defense in
trademark infringement. In McDonald's Corporation v. L.C.
Big Mak Burger. Inc.,[24] this Court held:
Modern law recognizes that the protection to which the
owner of a trademark is entitled is not limited to guarding his
goods or business from actual market competition with
identical or similar products of the parties, but extends to all
cases in which the use by a junior appropriator of a trade-
mark or trade-name is likely to lead to a confusion of source,
as where prospective purchasers would be misled into
thinking that the complaining party has extended his
business into the field (see 148 ALR 56 et seq; 53 Am. Jur.
576) or is in any way connected with the activities of the
infringer; or when it forestalls the normal potential expansion
of his business (v. 148 ALR 77, 84; 52 Am. Jur. 576, 577). x
x x[25]
Withal, the protection of trademarks as intellectual property
is intended not only to preserve the goodwill and reputation
of the business established on the goods bearing the mark
through actual use over a period of time, but also to
safeguard the public as consumers against confusion on
these goods.[27] While respondent's shoes contain some
dissimilarities with petitioner's shoes, this Court cannot close
its eye to the fact that for all intents and purpose, respondent
had deliberately attempted to copy petitioner's mark and
overall design and features of the shoes. Let it be
remembered, that defendants in cases of infringement do
not normally copy but only make colorable changes.[28] The
most successful form of copying is to employ enough points
of similarity to confuse the public, with enough points of
difference to confuse the courts.[29]
WHEREFORE, premises considered, the Motion for
Reconsideration is GRANTED. The Decision dated
November 30, 2006 is RECONSIDERED and SET ASIDE.
SO ORDERED.

Indeed, the registered trademark owner may use its mark on

the same or similar products, in different segments of the
market, and at different price levels depending on variations
of the products for specific segments of the market.[26] The
purchasing public might be mistaken in thinking that
petitioner had ventured into a lower market segment such
that it is not inconceivable for the public to think that Strong
or Strong Sport Trail might be associated or connected with
petitioner's brand, which scenario is plausible especially
since both petitioner and respondent manufacture rubber
shoes.