Republic of the Philippines

SUPREME COURT
Manila

EN BANC

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". 16They 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)

xxx xxx xxx

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. 24Implicit 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 Carrascoso had
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". 29And 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

xxx xxx xxx

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

xxx xxx xxx

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's testimony. 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.

Concepcion, C.J., Reyes, J.B.L., Barrera, Dizon, Regala, Makalintal, Zaldivar and
Castro, JJ., concur.
Bengzon, J.P., J., took no part.

THIRD DIVISION

PHILIPPINE NATIONAL G.R. No. 157658

RAILWAYS and VIRGILIO J.
BORJA, Present:
Petitioners,
YNARES-
- versus - SANTIAGO, J.,
Chairperson,
AUSTRIA-
COURT OF APPEALS (Second MARTINEZ,
Division), CORAZON C. CHICO-NAZARIO,
AMORES, MA. EMILIE A. NACHURA, and
MOJICA, CECILE C. SISON, DINO REYES, JJ.
C. AMORES, LARISA C.
AMORES, ARMAND JINO C. Promulgated:
AMORES and JOHN C. AMORES,
Respondents. October 15, 2007

x------------------------------------------------------------------------------------x

DECISION

NACHURA, J.:

Before the Court is a petition for review on certiorari under

Rule 45 of the 1997 Rules of Civil Procedure, as amended,
seeking to annul and set aside the Decision[1] of the Court of
Appeals (CA) in CA-G.R. CV No. 54906 which reversed the
Decision[2] of the Regional Trial Court (RTC) of Manila, Branch 28,
in Civil Case No. 92-61987.

The factual antecedents are as follows:

In the early afternoon of April 27, 1992, Jose Amores (Amores)

was traversing the railroad tracks in Kahilum II Street,
Pandacan, Manila. Before crossing the railroad track, he stopped
for a while then proceeded accordingly.[3] Unfortunately, just as
Amores was at the intersection, a Philippine National Railways
(PNR) train with locomotive number T-517 turned up and collided
with the car.[4]
At the time of the mishap, there was neither a signal nor a
crossing bar at the intersection to warn motorists of an
approaching train. Aside from the railroad track, the only visible
warning sign at that time was the defective standard signboard
STOP, LOOK and LISTEN wherein the sign Listen was lacking
while that of Look was bent.[5] No whistle blow from the train was
likewise heard before it finally bumped the car of Amores.[6] After
impact, the car was dragged about ten (10) meters beyond the
center of the crossing.[7] Amores died as a consequence thereof.

On July 22, 1992, the heirs of Amores, consisting of his surviving

wife and six children, herein respondents, filed a Complaint for
Damages[8] against petitioners PNR and Virgilio J. Borja (Borja),
PNRs locomotive driver at the time of the incident, before the
RTC of Manila. The case was raffled to Branch 28 and was
docketed as Civil Case No. 92-61987. In their complaint,
respondents averred that the trains speedometer was defective,
and that the petitioners negligence was the proximate cause of
the mishap for their failure to take precautions to prevent injury to
persons and property despite the dense population in the
vicinity. They then prayed for actual and moral damages, as well
as attorneys fees.[9]

In their Answer,[10] the petitioners denied the allegations, stating

that the train was railroad-worthy and without any defect.
According to them, the proximate cause of the death of Amores
was his own carelessness and negligence, and Amores wantonly
disregarded traffic rules and regulations in crossing the railroad
tracks and trying to beat the approaching train. They admitted that
there was no crossing bar at the site of the accident because it
was merely a barangay road.[11] PNR stressed that it exercised
the diligence of a good father of a family in the selection and
supervision of the locomotive driver and train engineer, Borja, and
that the latter likewise used extraordinary diligence and caution to
avoid the accident. Petitioners further asserted that respondents
had the last clear chance to avoid the accident but recklessly
failed to do so.

After trial on the merits, on August 22, 1996, the RTC

rendered judgment in favor of the petitioners, the dispositive
portion of which reads:
 WHEREFORE, judgment is hereby rendered dismissing the
complaint of the plaintiffs and the defendants counterclaim.

The costs shall be halved and paid equally by the parties.

The counsel for the defendants is hereby ordered to inform this

court who is the legal representative of the deceased
defendant, Virgilio Borja, within ten (10) days from receipt of a
copy of this decision.

SO ORDERED.[12]

The RTC rationalized that the proximate cause of the collision

was Amores fatal misjudgment and the reckless course of action
he took in crossing the railroad track even after seeing or hearing
the oncoming train.

On appeal, the CA reversed the RTC decision, as follows:

WHEREFORE, the assailed Decision of the Regional Trial

Court of Manila, Branch 28 is hereby REVERSED. The
defendants PNR and the estate of Virgilio J. Borja are jointly
and severally liable to pay plaintiffs the following:

1) The amount of P122,300.00 for the cost of damage to

the car; and,

2) The amount of P50,000 as moral damages.

For lack of official receipts for funeral expenses and

specimen of the last pay slip of the deceased, the claim for
reimbursement of funeral expenses and claim for payment of
support is hereby DENIED for lack of basis. Costs against
Defendants.

SO ORDERED.[13]
In reversing the trial courts decision, the appellate court found the
petitioners negligent. The court based the petitioners negligence
on the failure of PNR to install a semaphore or at the very least, to
post a flagman, considering that the crossing is located in a
thickly populated area. Moreover, the signboard Stop, Look and
Listen was found insufficient because of its defective condition as
described above. Lastly, no negligence could be attributed to
Amores as he exercised reasonable diligence in crossing the
railroad track.

Aggrieved by this reversal, the petitioners filed the present

petition for review on certiorari, raising the following grounds:

THE COURT OF APPEALS COMMITTED GRAVE ABUSE OF

DISCRETION IN RENDERING ITS DECISION REVERSING
THE DECISION OF THE REGIONAL TRIAL COURT OF
MANILA BRANCH 28, IN NOT TAKING INTO
CONSIDERATION THE PROVISION OF SECTION 42, R.A.
4136 OF THE LAND TRANSPORTATION AND TRAFFIC
CODE.

II

THE DECISION OF THE COURT OF APPEALS IS

CONTRARY TO THE EVIDENCE ON RECORD ADDUCED IN
THE TRIAL ON THE MERIT IN CIVIL CASE NO. 92-61987.[14]

The petitioners insist that Amores must have heard the trains
whistle and heeded the warning but, noting that the train was still
a distance away and moving slowly, he must have calculated that
he could beat it to the other side of the track before the train
would arrive at the intersection. The petitioners likewise add that
the train was railroad-worthy and that its defective speedometer
did not affect the trains operation. Lastly, they insist that evidence
showed sufficient warning signs strategically installed at the
crossing to alert both motorists and pedestrians.

Respondents, on the other hand, argue that the cause of the

accident was petitioners carelessness, imprudence and laxity in
failing to provide a crossing bar and keeper at the Kahilum II
railway intersection. Considering that Kahilum II Street is in the
middle of a thickly populated squatters area, and many
pedestrians cross the railroad track, notwithstanding the fact that
it is a public street and a main thoroughfare utilized in going to
Herran Street, the presence of adequate warning signals would
have prevented the untimely death of Amores. Another crucial
point raised by the respondents is the manner in which Borja
applied the brakes of the train only when the locomotive was
already very near Amores car, as admitted by witness Querimit.
Finally, respondents claim that Borjas failure to blow the
locomotives horn, pursuant to the usual practice of doing the
same 100 meters before reaching the Kahilum II crossing point is
an earmark of recklessness on the part of the petitioners.

The petition must fail.

The only issue to be resolved in the present case is whether

the appellate court was correct in ascribing negligence on the part
of the petitioners. It was ascertained beyond quandary that the
proximate cause of the collision is the negligence and imprudence
of the petitioner PNR and its locomotive driver, Borja, in operating
the passenger train.

As the action is predicated on negligence, the relevant

provision is Article 2176 of the New Civil Code, which states that:
 Whoever by act or omission causes damage to another, there
being fault or negligence, is obliged to pay for the damage
done. Such fault or negligence, if there was no pre-existing
contractual relation between the parties, is called quasi-delict
and is governed by the provisions of this chapter.

We have thoroughly reviewed the records of the case and

we find no cogent reason to reverse the appellate courts decision.
Negligence has been defined as 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.[15] Using the
aforementioned philosophy, it may be reliably concluded that
there is no hard and fast rule whereby such degree of care and
vigilance is calibrated; it is dependent upon the circumstances in
which a person finds himself. All that the law requires is that it is
perpetually compelling upon a person to use that care and
diligence expected of sensible men under comparable
circumstances.[16]

We hold that the petitioners were negligent when the

collision took place. The transcript of stenographic notes reveals
that the train was running at a fast speed because
notwithstanding the application of the ordinary and emergency
brakes, the train still dragged the car some distance away from
the point of impact. Evidence likewise unveils the inadequate
precautions taken by petitioner PNR to forewarn the public of the
impending danger. Aside from not having any crossing bar, no
flagman or guard to man the intersection at all times was posted
on the day of the incident. A reliable signaling device in good
condition, not just a dilapidated Stop, Look and Listen signage
because of many years of neglect, 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.

As held in the case of Philippine National Railway v.

Brunty,[17] it 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.[18] 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.

The petitioners insist that a train has a right-of-way in a

railroad crossing under the existing laws. They derive their theory
from Section 42 (d), Article III of R.A. 4136, otherwise known as
the Land Transportation and Traffic Code, which states that:

The driver of a vehicle upon a highway shall bring to a full

stop such vehicle before traversing any through highway or
railroad crossing: Provided, That when it is apparent that no
hazard exists, the vehicle may be slowed down to five miles per
hour instead of bringing it to a full stop.
They claim that motorists are enjoined by law to stop, look and
listen before crossing railroad tracks and that a heavier
responsibility rests upon the motorists in avoiding accidents at
level crossings.

It is true that one driving an automobile must use his

faculties of seeing and hearing when nearing a railroad crossing.
However, the obligation to bring to a full stop vehicles moving in
public highways before traversing any through street only accrues
from the time the said through street or crossing is so designated
and sign-posted. From the records of the case, it can be inferred
that Amores exercised all the necessary precautions required of
him as to avoid injury to himself and to others. The witnesses
testimonies showed that Amores slackened his speed, made a full
stop, and then proceeded to cross the tracks when he saw that
there was no impending danger to his life. Under these
circumstances, we are convinced that Amores did everything, with
absolute care and caution, to avoid the collision.

It is settled that every person or motorist crossing a railroad

track should use ordinary prudence and alertness to determine
the proximity of a train before attempting to cross. We are
persuaded that the circumstances were beyond the control of
Amores for no person would sacrifice his precious life if he had
the slightest opportunity to evade the catastrophe. Besides, the
authority in this jurisdiction is that the failure of a railroad company
to install a semaphore or at the very least, to post a flagman or
watchman to warn the public of the passing train amounts to
negligence.[19]

In view of the foregoing, We will now discuss the liability of

petitioner PNR. Article 2180[20] of the New Civil Code discusses
the liability of the employer once negligence or fault on the part of
the employee has been established. The employer is actually
liable on the assumption of juris tantum that the employer failed to
exercise diligentissimi patris families in

the selection and supervision of its employees. The liability is

primary and can only be negated by showing due diligence in the
selection and supervision of the employee, a factual matter that
has not been demonstrated.[21] Even the existence of hiring
procedures and supervisory employees cannot be incidentally
invoked to overturn the presumption of negligence on the part of
the employer.[22]

WHEREFORE, the petition is DENIED. The Decision of the

Court of Appeals dated March 31, 2003 in CA-G.R. CV No. 54906
is hereby AFFIRMED.

SO ORDERED.
G.R. No. 169891 November 2, 2006

PHILIPPINE NATIONAL RAILWAYS, Petitioner,

vs.
ETHEL BRUNTY and JUAN MANUEL M. GARCIA, Respondents.

DECISION

CALLEJO, SR., J.:

This is a Petition for Review on Certiorari of the Decision1 of the Court of Appeals (CA)
in CA-G.R. CV No. 47567 and its Resolution2 denying the motion for reconsideration
thereof. The assailed decision affirmed with partial modification the ruling3 of the
Regional Trial Court (RTC) of Manila, Branch 20, directing petitioner Philippine National
Railways (PNR) to indemnify respondents Ethel Brunty and Juan Manuel M. Garcia for
the death of Rhonda Brunty, and to pay actual and moral damages, attorney’s fees and
cost of suit.

Rhonda Brunty, daughter of respondent Ethel Brunty and an American citizen, came to
the Philippines for a visit sometime in January 1980. Prior to her departure, she,
together with her Filipino host Juan Manuel M. Garcia, traveled to Baguio City on board
a Mercedes Benz sedan with plate number FU 799, driven by Rodolfo L. Mercelita. It
was about 12:00 midnight, January 25, 1980. By then, PNR Train No. T-71, driven by
Alfonso Reyes, was on its way to Tutuban, Metro Manila4 as it had left the La Union
station at 11:00 p.m., January 24, 1980.

By 2:00 a.m., Rhonda Brunty, Garcia and Mercelita were already approaching the
railroad crossing at Barangay Rizal, Moncada, Tarlac. Mercelita, driving at
approximately 70 km/hr, drove past a vehicle, unaware of the railroad track up ahead
and that they were about to collide with PNR Train No. T-71. Mercelita was instantly
killed when the Mercedes Benz smashed into the train; the two other passengers
suffered serious physical injuries.5 A certain James Harrow6 brought Rhonda Brunty to
the Central Luzon Doctor’s Hospital in Tarlac, where she was pronounced dead after
ten minutes from arrival. Garcia, who had suffered severe head injuries, was brought via
ambulance to the same hospital. He was transferred to the Manila Doctor’s Hospital,
and later to the Makati Medical Center for further treatment.7

On July 28, 1981, Ethel Brunty sent a demand letter8 to the PNR demanding payment of
actual, compensatory, and moral damages, as a result of her daughter’s death. When
PNR did not respond, Ethel Brunty and Garcia, filed a complaint9 for damages against
the PNR before the RTC of Manila. The case was raffled to Branch 20 and was
docketed as Civil Case No. 83-18645. They alleged that the death of Mercelita and
Rhonda Brunty, as well as the physical injuries suffered by Garcia, were the direct and
proximate result of the gross and reckless negligence of PNR in not providing the
necessary equipment at the railroad crossing in Barangay Rizal, Municipality of
Moncada, Tarlac. They pointed out that there was no flagbar or red light signal to warn
motorists who were about to cross the railroad track, and that the flagman or switchman
was only equipped with a hand flashlight.10 Plaintiffs likewise averred that PNR failed to
supervise its employees in the performance of their respective tasks and duties, more
particularly the pilot and operator of the train.11 They prayed for the payment of the
following damages:

1.) ₱200,000.00 as actual and compensatory damages to plaintiff Ethel Brunty;

2.) ₱2,800,000.00 for compensatory damages to plaintiff Ethel Brunty

representing lost or unearned income of Rhonda Brunty;

3.) Such amounts of moral and exemplary damages as may be warranted by the
evidence adduced, to plaintiff Ethel Brunty;

4.) At least ₱64,057.61 as actual damages representing medical expenses to

plaintiff Juan Manuel M. Garcia and at least ₱1,000,000.00 as unearned or lost
income of said plaintiff;

5.) At least ₱72,760.00 as actual damages representing cost of the Mercedes

Benz car to plaintiff Juan Manuel M. Garcia;
 6.) Such amounts of moral and exemplary damages as may be warranted by the
evidence adduced, to plaintiff Juan Manuel M. Garcia; and

7.) Attorney’s fees equivalent to at least 15% of the total award to plaintiffs
herein.12

In its Answer,13 PNR claimed that it exercised the diligence of a good father of a family
not only in the selection but also in the supervision of its employees. 14 By way of special
and affirmative defense, it stressed that it had the right of way on the railroad crossing in
question, and that it has no legal duty to put up a bar or red light signal in any such
crossing. It insisted that there were adequate, visible, and clear warning signs
strategically posted on the sides of the road before the railroad crossing. It countered
that the immediate and proximate cause of the accident was Mercelita’s negligence,
and that he had the last clear chance to avoid the accident. The driver disregarded the
warning signs, the whistle blasts of the oncoming train and the flashlight signals to stop
given by the guard.15 As counterclaim, it prayed that it be awarded actual and
compensatory damages, and litigation expenses.16

Plaintiffs filed an Amended Complaint17 dated July 28, 1986 to include, as party plaintiff,
Chemical Industries of the Philippines, Inc. (Chemphil), Garcia’s employer, who claimed
to have paid for the latter’s medical and hospitalization expenses, the services rendered
by the funeral parlor of the deceased, and the expenses in transferring the remains of
Rhonda Brunty to the United States.18

After trial on the merits, the RTC rendered its Decision19 on May 21, 1990 in favor of
plaintiffs. The fallo reads:

WHEREFORE, judgment is hereby rendered in favor of the plaintiffs Ethel Brunty and
Juan Manuel M. Garcia and against the defendant Philippine National Railways
directing the latter to pay the former the sum of:

1. Thirty Thousand Pesos (₱30,000.00) Philippine Currency, for the death of

Rhonda Brunty formerly a resident of 1595 Ashland Avenue, Des Plaines, Illinois,
U.S.A.;

2. One Million Pesos (₱1,000,000.00) Philippine Currency for moral and actual
damages due the heirs of Rhonda Brunty;

3. Seventy-Two Thousand Seven Hundred Sixty Pesos (₱72,760.00) Philippine

Currency for damages sustained by the Mercedes Benz;

4. Fifty Thousand Pesos (₱50,000.00) Philippine Currency as and for attorney's

fees, and;

5. Costs of suit.
SO ORDERED.20

Aggrieved, the PNR appealed the case to the CA, raising the following errors:

I.

THE TRIAL COURT ERRED IN ADJUDGING DEFENDANT-APPELLANT PNR

LIABLE FOR THE DEATH OF RHONDA BRUNTY AND THE CONSEQUENT
AWARD OF DAMAGES DUE THE HEIRS OF RHONDA BRUNTY.

II.

THE TRIAL COURT ERRED IN ADJUDGING DEFENDANT-APPELLANT PNR

LIABLE FOR THE DAMAGES SUFFERED BY PLAINTIFF-APPELLEE’S
MERCEDES BENZ IN THE AMOUNT OF SEVENTY-TWO THOUSAND SEVEN
HUNDRED AND SIXTY PESOS (₱72,760.00).

III.

THE LOWER COURT ERRED IN AWARDING ATTORNEY’S FEES TO THE

PLAINTIFFS-APPELLEES.21

In its Brief, PNR insisted that the sole and proximate cause of the accident was the
negligence and recklessness of Garcia and Mercelita.22 It insisted that it had provided
adequate warning signals at the railroad crossing23 and had exercised due care in the
selection and supervision of its employees.24 The RTC erred in awarding damages to
Rhonda Brunty as she cannot be allowed to receive what she is not in a position to give,
having been a non-resident alien who did not own a property in the Philippines. 25 It
likewise questioned the award of damages on the Mercedes Benz as well as the grant
of attorney’s fees.26 At the very least, Mercelita was guilty of contributory negligence.27

For their part, appellees countered that appellant was grossly and recklessly negligent
in not properly providing the necessary equipment at the railroad crossing in Rizal,
Moncada, Tarlac;28 appellant was negligent in not exercising due diligence of a good
father of a family in the supervision of its employees, particularly the train operator
Alfonso Reyes;29 the car was driven in a careful and diligent manner, and at a moderate
speed, with due regard to all traffic rules and regulations at that particular time;30 the
doctrine of "last clear chance" is not applicable;31 Ethel Brunty is a non-resident alien
who can rightfully file the instant case;32 and they are entitled to recover damages from
appellant.33

The CA rendered the assailed Decision34 on August 15, 2005. The dispositive portion
reads:
WHEREFORE, premises considered, the assailed decision is hereby AFFIRMED with
PARTIAL MODIFICATIONS, increasing the death indemnity award from ₱30,000.00 to
₱50,000.00, and deleting the award for damages sustained by the Mercedes Benz.

SO ORDERED.35

The appellate court affirmed the findings of the RTC as to the negligence of the PNR.
Considering the circumstances prevailing at the time of the fatal accident, it ruled that
the alleged safety measures installed by the PNR at the railroad crossing were not
merely inadequate – they did not satisfy the well-settled safety standards in
transportation.36 However, the CA did not agree with the RTC’s findings on the
contributory negligence of Mercelita, the driver of the Mercedes Benz. It held that
Mercelita could not have foreseen the harm that would befall him and the two other
passengers under the prevailing circumstances, thus, could not be considered guilty of
contributory negligence.37

The PNR, now petitioner, comes before this Court in this Petition for Review on
Certiorari on the following grounds:

I.

THE COURT OF APPEALS ERRED IN MANIFESTLY OVERLOOKING CERTAIN

RELEVANT FACTS NOT DISPUTED BY THE PARTIES AND WHICH, IF PROPERLY
CONSIDERED, WOULD JUSTIFY A DIFFERENT CONCLUSION SUCH AS:

THE RESPONDENTS’ DRIVER OVERTOOK ANOTHER VEHICLE BY

ACCELERATING AT 70 KILOMETERS PER HOUR WITHIN JUST 50 YARDS AWAY
FROM THE RAILROAD TRACKS.

II.

THE FINDINGS OF FACT OF THE COURT OF APPEALS ARE CONTRARY TO

THOSE OF THE TRIAL COURT REGARDING CONTRIBUTORY NEGLIGENCE OF
THE RESPONDENTS’ DRIVER.

III.

THE COURT OF APPEALS ERRED IN NOT APPLYING THE DOCTRINE OF LAST

CLEAR CHANCE IN THE INSTANT CASE.38

Petitioner insists that the proximate cause of the mishap was Mercelita’s disregard of
traffic rules and regulations. Had the court considered the fact that Mercelita had
overtaken another vehicle a few yards before the railroad track, it would have reached a
different conclusion.39 Moreover, petitioner asserts, considering that the decisions of the
RTC and the CA vary as to whether or not Mercelita was guilty of contributory
negligence, the findings of the RTC should prevail. Thus, Mercelita’s contributory
negligence should not have been ignored.40 Lastly, petitioner avers that since there is
freedom of control and greater maneuverability on the part of motor vehicles, it is
obvious that in railroad crossings, they have the last clear chance to prevent or avoid an
unwanted accident from taking place.41

In their Comment42 on the petition, respondents reiterate the findings of the RTC and the
CA that the breach by petitioner of its legal duty to provide adequate and necessary
public safety device and equipment within the area or scene of the accident was the
proximate cause of the mishap.43 While it is true that as a general rule, the trial court is
in the best position to evaluate and observe the conduct and demeanor of the witnesses
presented during the trial, the CA, in the exercise of its appellate jurisdiction, has the
vested right to modify, reject, or set aside the trial court’s evaluation and findings. 44 As to
the application of the doctrine of last clear chance, respondents claim that said issue is
being raised for the first time in this petition.45 Lastly, respondents cite foreign
jurisprudence stating that if the violation is one which gives rise to liability per se for any
resulting injury, the defenses ordinarily available in actions for diligence are barred and
the contributory negligence of the person injured is no defense.46

The Court is thus tasked to answer the following factual questions: (1) As between
petitioner and Mercelita, whose negligence resulted in the unfortunate collision? (2) Is
Mercelita (the driver of the Mercedes Benz) guilty of contributory negligence? Finally,
the application in this case of the doctrine of last clear chance is likewise in question.

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. 47 In Corliss v.
Manila Railroad Company,48 this Court held that negligence is want of the care required
by the circumstances. It is a relative or comparative, not an absolute, term and its
application depends upon the situation of the parties and the degree of care and
vigilance which the circumstances reasonably require.49 In determining whether or not
there is negligence on the part of the parties in a given situation, jurisprudence 50 has laid
down the following test: Did 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, the person is guilty of negligence. The law, in effect, adopts the
standard supposed to be supplied by the imaginary conduct of the discreet pater
familias of the Roman law.

The issue of who, between the parties, was negligent was thoroughly discussed by both
the RTC and the CA. In petitions for review under Rule 45 of the Revised Rules of
Court, only questions of law may be put into issue, and questions of fact as a general
rule, cannot be entertained. The finding of negligence by the RTC, as affirmed by the
CA, is a question of fact which this Court cannot pass upon as it would entail going into
factual matters on which the finding of negligence was based.51 The established rule is
that factual findings of the CA affirming those of the trial court are conclusive and
binding on this Court.52
The records of the instant case show that both the RTC and the CA carefully examined
the factual circumstances surrounding the case, and we find no cogent reason to disturb
the same. It is, however, worthy to emphasize that petitioner was found negligent
because of its failure to provide the necessary safety device to ensure the safety of
motorists in crossing the railroad track. As such, it is liable for damages for violating the
provisions of Article 2176 of the New Civil Code, viz:

Article 2176. Whoever, by act or omission, causes damage to another, there being fault
or negligence, is obliged to pay for the damage done. Such fault or negligence, if there
is no pre-existing contractual relation between the parties, is called a quasi-delict and is
governed by the provisions of this Chapter.

In a long line of cases, the Court held that in order to sustain a claim based on quasi-
delict, the following requisites must concur: (1) damage to plaintiff; (2) negligence, by
act or omission, of which defendant, or some person for whose acts he must respond
was guilty; and (3) connection of cause and effect between such negligence and
damage.53 Applying the foregoing requisites, the CA correctly made the following
conclusions:

It was clearly established that plaintiffs-appellees (respondents herein) sustained

damage or injury as a result of the collision. That there was negligence on the part of
PNR is, likewise, beyond cavil. Considering the circumstances prevailing at the time of
the fatal accident, the alleged safety measures installed by the PNR at the railroad
crossing is not only inadequate but does not satisfy well-settled safety standards in
transportation. x x x

xxxx

x x x An examination of the photographs of the railroad crossing at Moncada, Tarlac

presented as evidence by PNR itself would yield the following: (1.) absence of flagbars
or safety railroad bars; (2.) inadequacy of the installed warning signals; and (3.) lack of
proper lighting within the area. Thus, even if there was a flagman stationed at the site as
claimed by PNR (petitioner), it would still be impossible to know or see that there is a
railroad crossing/tracks ahead, or that there is an approaching train from the Moncada
side of the road since one’s view would be blocked by a cockpit arena. x x x54

Moreover, the CA held that a vehicle coming from the Moncada side would have
difficulty in knowing that there is an approaching train because of the slight curve, more
so, at an unholy hour as 2:00 a.m. Thus, it is imperative on the part of the PNR to
provide adequate safety equipment in the area.55

It 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 in the operation of trains and in the maintenance of the
crossings.56 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 a 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.57

This Court has previously determined the liability of the PNR for damages for its failure
to put a cross bar, or signal light, flagman or switchman, or semaphores. Such failure 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.58

In view of the foregoing, we affirm the factual findings of the CA as well as its conclusion
on petitioner’s negligence.

As to whether or not Mercelita was guilty of contributory negligence, we agree with

petitioner. 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 to which he is required to conform for his own protection.59 To hold a person as
having contributed to his injuries, it must be shown that he performed an act that
brought about his injuries in disregard of warning or signs of an impending danger to
health and body.60 To prove contributory negligence, it is still necessary to establish a
causal link, although not proximate, between the negligence of the party and the
succeeding injury. In a legal sense, negligence is contributory only when it contributes
proximately to the injury, and not simply a condition for its occurrence.61

The court below found that there was a slight curve before approaching the tracks; the
place was not properly illuminated; one’s view was blocked by a cockpit arena; and
Mercelita was not familiar with the road. Yet, it was also established that Mercelita was
then driving the Mercedes Benz at a speed of 70 km/hr and, in fact, had overtaken a
vehicle a few yards before reaching the railroad track. Mercelita should not have driven
the car the way he did. However, while his acts contributed to the collision, they
nevertheless do not negate petitioner’s liability. Pursuant to Article 2179 62 of the New
Civil Code, the only effect such contributory negligence could have is to mitigate liability,
which, however, is not applicable in this case, as will be discussed later. 1âwphi1

As to whether or not the doctrine of last clear chance is applicable, we rule in the
negative. The doctrine of last clear chance states that where both parties are negligent
but the negligent act of one is appreciably later than that of the other, or where it is
impossible to determine whose fault or negligence caused the loss, the one who had
the last clear opportunity to avoid the loss but failed to do so, is chargeable with the
loss. Stated differently, the antecedent negligence of plaintiff does not preclude him
from recovering damages caused by the supervening negligence of defendant, who had
the last fair chance to prevent the impending harm by the exercise of due
diligence.63 The proximate cause of the injury having been established to be the
negligence of petitioner, we hold that the above doctrine finds no application in the
instant case.
We note that the damages awarded by the appellate court consist of (1) ₱50,000.00 as
indemnity for the death of Rhonda Brunty; (2) ₱1,000,000.00 as actual and moral
damages due the heirs of Rhonda Brunty; and (3) ₱50,000.00 as and by way of
attorney’s fees. No damages, however, were awarded for the injuries suffered by
Garcia, yet, the latter never interposed an appeal before the CA nor even before this
Court. The record is, likewise, bereft of any allegation and proof as to the relationship
between Mercelita (the driver) and Rhonda Brunty. Hence, the earlier finding of
contributory negligence on the part of Mercelita, which generally has the effect of
mitigation of liability, does not apply.

As to the amount of damages awarded, a modification of the same is in order,

specifically on the award of actual and moral damages in the aggregate amount of
₱1,000,000.00.

Actual or compensatory damages are those awarded in order to compensate a party for
an injury or loss he suffered. They arise out of a sense of natural justice, aimed at
repairing the wrong done. To be recoverable, they must be duly proved with a
reasonable degree of certainty. A court cannot rely on speculation, conjecture, or
guesswork as to the fact and amount of damages, but must depend upon competent
proof that they have suffered, and on evidence of the actual amount
thereof.64 Respondents, however, failed to present evidence for such damages; hence,
the award of actual damages cannot be sustained. However, as the heirs of Rhonda
Brunty undeniably incurred expenses for the wake and burial of the latter, we deem it
proper to award temperate damages in the amount of ₱25,000.00 pursuant to prevailing
jurisprudence.65 This is in lieu of actual damages as it would be unfair for the victim’s
heirs to get nothing, despite the death of their kin, for the reason alone that they cannot
produce receipts.66

The relatives of the victim who incurred physical injuries in a quasi-delict are not
proscribed from recovering moral damages in meritorious cases. 67 We, therefore,
sustain the award of moral damages in favor of the heirs of Rhonda Brunty.

Moral damages are not punitive in nature, but are designed to compensate 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. Although incapable of pecuniary computation, moral damages must
nevertheless be somehow proportional to and in approximation of the suffering
inflicted.68 In the instant case, the moral suffering of the heirs of Rhonda Brunty was
sufficiently established by Ethel Brunty in her deposition,69 viz:

Q: What have you felt as a result of the death of Rhonda?

A: I felt earnest anguish and mixed feelings of anger and extreme sorrow because she
died so far away and alone, and because her death could so easily be prevented if
there had been adequate and appropriate warning signals at the railroad crossing and it
is just an unbearable and irreparable loss. In so many ways, she was my life. It seemed
to me that losing her was just like losing my own life, or worst, and even now, there is
no end to our bereavement. I am still on constant medication to be able to sleep and to
be able to perform my duties effectively in my job but it does not take away the pain of
loss.70

In People v. Teehankee, Jr.,71 and in Metro Manila Transit Corporation v. Court of

Appeals,72 we awarded moral damages in the amount of ₱1,000,000.00 to the heirs of
the deceased. In Victory Liner, Inc. v. Heirs of Malecdan,73the award of ₱100,000.00 as
moral damages was held in keeping with the purpose of the law, while in Macalinao v.
Ong,74 the amount of ₱50,000.00 was held sufficient. 1âwphi1

Considering the circumstances attendant in this case, we find that an award of

₱500,000.00 as moral damages to the heirs of Rhonda Brunty is proper. In view of
recent jurisprudence, indemnity of ₱50,000.00 for the death of Rhonda Brunty and
attorney’s fees amounting to ₱50,000.00 is likewise proper.

WHEREFORE, premises considered, the Decision of the Court of Appeals dated

August 15, 2005 is AFFIRMED WITH MODIFICATIONS. The award of actual damages
is deleted, and in lieu thereof, temperate damages of ₱25,000.00 is awarded to the
heirs of Rhonda Brunty. The award of moral damages is reduced to ₱500,000.00.

SO ORDERED.

ROMEO J. CALLEJO, SR.

Associate Justice

WE CONCUR:

SECOND DIVISION

CONCEPCION ILAO-ORETA, G.R. No. 172406

Petitioner,
Present:

QUISUMBING, J., Chairperson,

CARPIO,
- versus - CARPIO MORALES,
TINGA, and
VELASCO, JR., JJ.

Promulgated:
SPOUSES EVA MARIE and October 11, 2007
BENEDICTO NOEL
RONQUILLO,
Respondents.

x-----------------------------------------------
- - - -x

DECISION

CARPIO MORALES, J.:

Respondents, spouses Eva Marie Ronquillo (Eva Marie) and
Noel Benedicto (Noel) Ronquillo (the Ronquillo spouses or the
spouses), had not been blessed with a child despite several years
of marriage. They thus consulted petitioner, Dr. Concepcion Ilao-
Oreta (Dr. Ilao-Oreta), an obstetrician-gynecologist-consultant at
the St. Lukes Medical Center where she was, at the time material
to the case, the chief of the Reproductive Endocrinology and
Infertility Section.

Upon Dr. Ilao-Oretas advice, Eva Marie agreed to undergo a

laparoscopic procedure whereby a laparascope would be inserted
through the patients abdominal wall to get a direct view of her
internal reproductive organ in order to determine the real cause of
her infertility.
The procedure was scheduled on April 5, 1999 at 2:00 p.m.,
to be performed by Dr. Ilao-Oreta. At around 7:00 a.m. of said
date, Eva Marie, accompanied by her husband Noel, checked in
at the St. Lukes Medical Center and underwent pre-operative
procedures including the administration of intravenous fluid and
enema.

Dr. Ilao-Oreta did not arrive at the scheduled time for the
procedure, however, and no prior notice of its cancellation was
received. It turned out that the doctor was on a return flight
from Hawaii to, and arrived at 10:00 p.m. of April 5,
1999 in, Manila.

On May 18, 1999, the Ronquillo spouses filed a

complaint[1] against Dr. Ilao-Oreta and the St.
Lukes Medical Center for breach of professional and service
contract and for damages before the Regional Trial Court (RTC)
of Batangas City. They prayed for the award of actual damages
including alleged loss of income of Noel while accompanying his
wife to the hospital, moral damages, exemplary damages, the
costs of litigation, attorneys fees, and other available reliefs and
remedies.[2]

In her Answer,[3] Dr. Ilao-Oreta gave her side of the case as

follows: She went on a honeymoon to Hawaii and was scheduled
to leave Hawaii at 3:00 p.m. of April 4, 1999 for Manila. Aware
that her trip from Hawaii to Manila would take about 12 hours,
inclusive of a stop-over at the Narita Airport in Japan, she
estimated that she would arrive in Manila in the early morning
of April 5, 1999. She thus believed in utmost good faith that she
would be back in Manila in time for the scheduled conduct of the
laparoscopic procedure. She failed to consider the time difference
between Hawaii and the Philippines, however.

In its Answer,[4] the St. Lukes Medical Center contended that

the spouses have no cause of action against it since it performed
the pre-operative procedures without delay, and any cause of
action they have would be against Dr. Ilao-Oreta.

By Decision[5] of March 9, 2001, Branch 84 of

the Batangas RTC, finding that the failure of the doctor to arrive
on time was not intentional, awarded Eva Marie only actual
damages in the total amount of P9,939 and costs of suit. It found
no adequate proof that Noel had been deprived of any job
contract while attending to his wife in the hospital.

On appeal by the spouses, the Court of Appeals, by

Decision[6] of April 21, 2006, finding Dr. Ilao-
[7]
Oreta grossly negligent, modified the trial courts decision as
follows:

WHEREFORE, the trial Courts decision dated March 9,

2001 is affirmed, subject to the modification that the amount of
actual damages, for which both defendants-appellees are jointly
and severally liable to plaintiffs-appellants, is increased to
P16,069.40. Furthermore, defendant-appellee Dr. Ilao-Oreta is
also held liable to pay plaintiff-appellants the following:

(a) P50,000.00 as moral damages;

(b) P25,000.00 as exemplary damages; and

(c) P20,000.00 as attorneys fees.

SO ORDERED.[8] (Underscoring supplied)

Hence, the present Petition for Review[9] of Dr. Ilao-

Oreta raising the following arguments:
 THE COURT A QUO ERRED IN FINDING PETITIONER
TO HAVE ACTED WITH GROSS NEGLIGENCE AND
AWARDING MORAL DAMAGES TO RESPONDENTS.[10]

THE COURT A QUO ERRED IN AWARDING

EXEMPLARY DAMAGES TO RESPONDENTS.[11]

THE COURT A QUO [ERRED] IN AWARDING

ATTORNEYS FEES TO RESPONDENTS.[12]

THE COURT A QUO ERRED IN INCREASING THE

AWARD OF ACTUAL DAMAGES IN FAVOR OF
RESPONDENTS.[13]

Gross negligence implies a want or absence of or failure to

exercise slight care or diligence, or the entire absence of care. It
evinces a thoughtless disregard of consequences without exerting
any effort to avoid them.[14] It is characterized by want of even
slight care, acting or omitting to act in a situation where there is a
duty to act, not inadvertently but willfully and intentionally with a
conscious indifference to consequences in so far as other
persons may be affected.[15]

The records show that before leaving for Hawaii, Dr. Ilao-
Oreta left an admitting order with her secretary for one of the
spouses to pick up, apprised Eva Marie of the necessary
preparations for the procedure, and instructed the hospital staff to
perform pre-operative treatments.[16] These acts of the doctor
reflect an earnest intention to perform the procedure on the day
and time scheduled.

The records also show that on realizing that she missed the
scheduled procedure, Dr. Ilao-Oreta, upon arrival in Manila,
immediately sought to rectify the same, thus:
[ATTY SINJAN] Q: So, can you tell us the reason why you
missed that operation?

[DR. ILAO-ORETA] A: When I scheduled her for the surgery, I

looked at my ticket and so I was to leave Hawaii on April
4 at around 4:00 oclock in the afternoon, so I was
computing 12 hours of travel including stop-over, then
probably I would be in Manila early morning of April 5,
then I have so much time and I can easily do the case at
2:00 oclock, you know it skipped my mind the change in
time.

Q: So when you arrived at 10:00 [PM] in Manila, what did you

do?

A: I called immediately the hospital and I talked with the nurses,

I asked about the patient, Mrs. Ronquillo, and they told
me that she has already left at around 7:00.

Q: And after calling the hospital, what happened?

A: I wanted to call the plaintiffs, but I didnt have their number at

that time, so in the morning I went to my office early
at 8:00 and looked for her chart, because her telephone
number was written in the chart. So, I called them right
away.

Q: Were you able to contact them?

A: I was able to reach Mr. Ronquillo.

Q: In the course of your conversation, what did you tell Mr.

Ronquillo?

A: I apologized to him, I said I was sorry about the time that I

missed the surgery, and I told him that I can do the case
right that same day without Mrs. Ronquillo having to
undergo another [b]arium enema.

Q: What else did you tell him, if any?

 A: I asked him whether I can talk with Mrs. Ronquillo because I
wanted to apologize to her personally.

Q: And what did he say?

A: I could hear on the background that Mrs. Ronquillo was

shouting angrily that she didnt want to talk to me, and that
she didnt want re-scheduling of the surgery . . .

ATTY LONTOK: May we move, your Honor, for the striking out
of the answer, this is purely hearsay.

COURT: Remain on the record.

WITNESS [DR. ILAO-ORETA]: . . . and then Mr. Ronquillo told
me Im sorry, Dra., we cannot re-schedule the
surgery.[17] (Underscoring supplied)

Noel admitted that indeed Dr. Ilao-Oreta called him up after she
arrived in Manila as related by her.[18]

The evidence then shows that Dr. Ilao-Oreta, who had

traveled more than twice to the United States where she obtained
a fellowship in Reproductive Endocrinology and Infertility was
indeed negligent when she scheduled to perform professional
service at 2:00 p.m. on April 5, 1999 without considering the time
difference between the Philippines and Hawaii.

The doctors act did not, however, reflect gross negligence as

defined above. Her argument that

Although petitioner failed to take into consideration the

time difference between the Philippines and Hawaii, the
situation then did not present any clear and apparent harm or
injury that even a careless person may perceive. Unlike in
situations where the Supreme Court had found gross
 negligence to exist, petitioner could not have been conscious of
any foreseeable danger that may occur since she actually
believed that she would make it to the operation that was
elective in nature, the only purpose of which was to determine
the real cause of infertility and not to treat and cure a life
threatening disease. Thus, in merely fixing the date of her
appointment with respondent Eva Marie Ronquillo, petitioner
was not in the pursuit or performance of conduct which any
ordinary person may deem to probably and naturally result in
injury,[19] (Underscoring in original)

thus persuades.

It bears noting that when she was scheduling the date of her
performance of the procedure, Dr. Ilao-Oreta had just gotten
married and was preparing for her honeymoon,[20] and it is of
common human knowledge that excitement attends its
preparations. Her negligence could then be partly attributed to
human frailty which rules out its characterization as gross.

The doctors negligence not being gross, the spouses are not
entitled to recover moral damages.

Neither are the spouses entitled to recover exemplary

damages in the absence of a showing that Dr. Ilao-Oreta acted in
a wanton, fraudulent, reckless, oppressive or malevolent
manner,[21] nor to award of attorneys fees as, contrary to the
finding of the Court of Appeals that the spouses were compelled
to litigate and incur expenses to protect their interest,[22] the
records show that they did not exert enough efforts to settle the
matter before going to court. Eva Marie herself testified:

ATTY. SINJIAN:
Q: Isnt it true that before instituting this present case, you did
not make any demand on Dr. Ilao-Oreta regarding the
 claims which you have allegedly incurred, because of the
failed laparoscopic surgery operation?

A [EVA MARIE]: I will tell the truth. Dr. Augusto Reyes of St.
Lukes . . .

Q: But did you demand?

A: No, I did not demand because

ATTY. SINJIAN: That will be all, your Honor.

ATTY. LONTOK: The witness is still explaining.

WITNESS: Im explaining first. Dr. Augusto Reyes told me that

he will hold the meeting for me and Dr. Oreta to settle
things and reimburse all the money that I spent from the
hospital, and he even suggested Dr. Oreta to personally
talk to me.

ATTY. SINJIAN:
Q: So it was to Dr. Augusto Reyes that you talked?
A: Yes.

Q: But you did not demand anything or write to Dr. Oreta?

A: No.

Q: Before instituting this case?

A: No.[23] (Underscoring supplied)

Finally, Dr. Ilao-Oretas prayer for the reduction of actual

damages is well-taken. Article 2201 of the Civil Code provides:

In contracts and quasi-contracts, the damages for which

the obligor who acted in good faith is liable shall be those which
are the natural and probable consequences of the breach of the
 obligation, and which the parties have foreseen or could have
reasonably foreseen at the time the obligation was constituted.

In fixing the amount of actual damages, the Court of Appeals and

the trial court included expenses which the spouses
incurred prior to April 5, 1999 when the breach of contract
complained of occurred.[24] The Court of Appeals also included the
alleged P300 spent on fuel consumption from the spouses
residence at San Pascual, Batangas to the St.
Lukes Medical Center in Quezon City and the alleged P500 spent
on food in the hospital canteen, both of which are unsubstantiated
by independent or competent proof.[25] The only piece of
documentary evidence supporting the food and fuel expenses is
an unsigned listing.[26] As the fuel and food expenses are not
adequately substantiated, they cannot be included in the
computation of the amount of actual damages. So Premiere
Development Bank v. Court of Appeals[27] instructs:

In the instant case, the actual damages were proven

through the sole testimony of Themistocles Ruguero, the vice
president for administration of Panacor. In his testimony, the
witness affirmed that Panacor incurred losses, specifically, in
terms of training and seminars, leasehold acquisition,
procurement of vehicles and office equipment without, however,
adducing receipts to substantiate the same. The documentary
evidence marked as Exhibit W, which was an ordinary private
writing allegedly itemizing the capital expenditures and losses
from the failed operation of Panacor, was not testified to by any
witness to ascertain the veracity of its content. Although the
lower court fixed the sum of P4,520,000.00 as the total
expenditures incurred by Panacor, it failed to show how and in
what manner the same were substantiated by the claimant with
reasonable certainty. Hence, the claim for actual damages
should be received with extreme caution since it is only based
on bare assertion without support from independent
evidence. Premieres failure to prove actual expenditure
 consequently conduces to a failure of its claim. In determining
actual damages, the court cannot rely on mere assertions,
speculations, conjectures or guesswork but must depend
on competent proof and on the best evidence obtainable
regarding the actual amount of loss.[28] (Underscoring supplied)

The list of expenses cannot replace receipts when they should

have been issued as a matter of course in business
transactions[29] as in the case of purchase of gasoline and of food.

The documented claim for hospital and medical expenses of

the spouses is detailed in the Statement of Account issued by the
hospital, the pertinent entries of which read:

xxxx

GROSS HOSPITAL CHARGES 2,416.50

4/5/1999 1699460 DEPOSITOFFICIAL
RECEIPT (5,000.00)
(5,000.00)
________
4/5/1999 SECOND 0284893 UNUSED MED 0439534 (65.55)
FLOOR HINOX 500 MG CAP
SECOND 0284894 UNUSED MED 0439893 (62.25)
FLOOR PHENERGAN 2 ML
50MG ______ (127.80)
BALANCE DUE (2,711.30)[30]
=======

As extrapolated from the above-quoted entries in the Statement of

Account, P2,288.70 (the gross hospital charges of P2,416.50 less
the unused medicine in the amount of P127.80) was debited from
the P5,000 deposit[31] to thus leave a balance of the deposit in the
amount of P2,711.30, which the trial court erroneously
denominated as confinement fee. The remaining balance
of P2,711.30 was the amount refundable to the spouses.
 Following Eastern Shipping Lines, Inc. v. Court of
Appeals,[32] this Court awards interest on the actual damages to
be paid by Dr. Ilao-Oreta at the rate of 6% per annum from the
time of the filing of the complaint on May 18, 1999, and at 12% per
annum from the finality of this judgment until its satisfaction.

WHEREFORE, the petition is GRANTED. The decision

appealed from is MODIFIED in that

1) the award to respondents-spouses Noel and Eva

Marie Ronquillo of actual damages is REDUCED to P2,288.70, to
bear interest at a rate of 6% per annum from the time of the filing
of the complaint on May 18, 1999 and, upon finality of this
judgment, at the rate of 12% per annum until satisfaction; and

2. The award of moral and exemplary damages and

attorneys fees is DELETED.

SO ORDERED.

CONCHITA CARPIO MORALES

Associate Justice

WE CONCUR:

Republic of the Philippines

Supreme Court
Manila
 THIRD DIVISION

ROBERTO C. SICAM and AGENCIA G.R. NO. 159617

de R.C. SICAM, INC.,
Petitioners,
Present:

YNARES-SANTIAGO, J.,
Chairperson,
- versus - AUSTRIA-MARTINEZ,
CHICO-NAZARIO, and
NACHURA, JJ.

LULU V. JORGE and CESAR

JORGE, Promulgated:
Respondents. August 8, 2007
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
----x

DECISION

AUSTRIA-MARTINEZ, J.:
Before us is a Petition for Review on Certiorari filed by Roberto
C. Sicam, Jr. (petitioner Sicam) and Agencia de R.C. Sicam, Inc.
(petitioner corporation) seeking to annul the Decision[1] of the
Court of Appeals dated March 31, 2003, and its
Resolution[2] dated August 8, 2003, in CA G.R. CV No. 56633.

It appears that on different dates from September to October

1987, Lulu V. Jorge (respondent Lulu) pawned several pieces of
jewelry with Agencia de R. C. Sicam located at No. 17 Aguirre
Ave., BF Homes Paraaque, Metro Manila, to secure a loan in the
total amount of P59,500.00.

On October 19, 1987, two armed men entered the pawnshop and
took away whatever cash and jewelry were found inside the
pawnshop vault. The incident was entered in the police blotter of
the Southern Police District, Paraaque Police Station as follows:

Investigation shows that at above TDPO, while victims were

inside the office, two (2) male unidentified persons entered into
the said office with guns drawn. Suspects(sic) (1) went straight
inside and poked his gun toward Romeo Sicam and thereby tied
him with an electric wire while suspects (sic) (2) poked his gun
toward Divina Mata and Isabelita Rodriguez and ordered them to
lay (sic) face flat on the floor. Suspects asked forcibly the case
and assorted pawned jewelries items mentioned above.

Suspects after taking the money and jewelries fled on board

a Marson Toyota unidentified plate number.[3]

Petitioner Sicam sent respondent Lulu a letter dated October 19,

1987 informing her of the loss of her jewelry due to the robbery
incident in the pawnshop. On November 2, 1987, respondent Lulu
then wrote a letter[4] to petitioner Sicam expressing disbelief
stating that when the robbery happened, all jewelry pawned were
deposited with Far East Bank near the pawnshop since it had
been the practice that before they could withdraw, advance notice
must be given to the pawnshop so it could withdraw the jewelry
from the bank. Respondent Lulu then requested
petitioner Sicam to prepare the pawned jewelry for withdrawal
on November 6, 1987 but petitioner Sicam failed to return the
jewelry.
On September 28, 1988, respondent Lulu joined by her husband,
Cesar Jorge, filed a complaint against petitioner Sicam with the
Regional Trial Court of Makati seeking indemnification for the loss
of pawned jewelry and payment of actual, moral and exemplary
damages as well as attorney's fees. The case was docketed as
Civil Case No. 88-2035.

Petitioner Sicam filed his Answer contending that he is not the

real party-in-interest as the pawnshop was incorporated on April
20, 1987 and known as Agencia de R.C. Sicam, Inc; that
petitioner corporation had exercised due care and diligence in the
safekeeping of the articles pledged with it and could not be made
liable for an event that is fortuitous.

Respondents subsequently filed an Amended Complaint to

include petitioner corporation.

Thereafter, petitioner Sicam filed a Motion to Dismiss as far as he

is concerned considering that he is not the real party-in-interest.
Respondents opposed the same. The RTC denied the motion in
an Order dated November 8, 1989.[5]
After trial on the merits, the RTC rendered its
Decision[6] dated January 12, 1993, dismissing respondents
complaint as well as petitioners counterclaim. The RTC held that
petitioner Sicam could not be made personally liable for a claim
arising out of a corporate transaction; that in the Amended
Complaint of respondents, they asserted that plaintiff pawned
assorted jewelries in defendants' pawnshop; and that as a
consequence of the separate juridical personality of a corporation,
the corporate debt or credit is not the debt or credit of a
stockholder.

The RTC further ruled that petitioner corporation could not be held
liable for the loss of the pawned jewelry since it had not been
rebutted by respondents that the loss of the pledged pieces of
jewelry in the possession of the corporation was occasioned by
armed robbery; that robbery is a fortuitous event which exempts
the victim from liability for the loss, citing the case of Austria v.
Court of Appeals;[7] and that the parties transaction was that
of a pledgor and pledgee and under Art. 1174 of the Civil Code,
the pawnshop as a pledgee is not responsible for those events
which could not be foreseen.

Respondents appealed the RTC Decision to the CA. In a Decision

dated March 31, 2003, the CA reversed the RTC,
the dispositive portion of which reads as follows:

WHEREFORE, premises considered, the instant Appeal is

GRANTED, and the Decision dated January 12, 1993,of the
Regional Trial Court of Makati, Branch 62, is hereby
REVERSED and SET ASIDE, ordering the appellees to pay
appellants the actual value of the lost jewelry amounting
to P272,000.00, and attorney' fees of P27,200.00.[8]

In finding petitioner Sicam liable together with petitioner

corporation, the CA applied the doctrine of piercing the veil of
corporate entity reasoning that respondents were misled into
thinking that they were dealing with the pawnshop owned by
petitioner Sicam as all the pawnshop tickets issued to them bear
the words Agencia de R.C. Sicam; and that there was no
indication on the pawnshop tickets that it was the petitioner
corporation that owned the pawnshop which explained why
respondents had to amend their complaint impleading petitioner
corporation.

The CA further held that the corresponding diligence required of a

pawnshop is that it should take steps to secure and protect the
pledged items and should take steps to insure itself against the
loss of articles which are entrusted to its custody as it derives
earnings from the pawnshop trade which petitioners failed to do;
that Austria is not applicable to this case since the robbery
incident happened in 1961 when the criminality had not as yet
reached the levels attained in the present day; that they are at
least guilty of contributory negligence and should be held liable for
the loss of jewelries; and that robberies and hold-ups are
foreseeable risks in that those engaged in the pawnshop business
are expected to foresee.

The CA concluded that both petitioners should be jointly and

severally held liable to respondents for the loss of the pawned
jewelry.

Petitioners motion for reconsideration was denied in a

Resolution dated August 8, 2003.

Hence, the instant petition for review with the following

assignment of errors:

THE COURT OF APPEALS ERRED AND WHEN IT DID, IT

OPENED ITSELF TO REVERSAL, WHEN IT ADOPTED
UNCRITICALLY (IN FACT IT REPRODUCED AS ITS OWN
WITHOUT IN THE MEANTIME ACKNOWLEDGING IT) WHAT
THE RESPONDENTS ARGUED IN THEIR BRIEF, WHICH
ARGUMENT WAS PALPABLY UNSUSTAINABLE.

THE COURT OF APPEALS ERRED, AND WHEN IT DID, IT

OPENED ITSELF TO REVERSAL BY THIS HONORABLE
COURT, WHEN IT AGAIN ADOPTED UNCRITICALLY (BUT
WITHOUT ACKNOWLEDGING IT) THE SUBMISSIONS OF
THE RESPONDENTS IN THEIR BRIEF WITHOUT ADDING
ANYTHING MORE THERETO DESPITE THE FACT THAT THE
SAID ARGUMENT OF THE RESPONDENTS COULD NOT
 HAVE BEEN SUSTAINED IN VIEW OF UNREBUTTED
EVIDENCE ON RECORD.[9]

Anent the first assigned error, petitioners point out that the CAs
finding that petitioner Sicam is personally liable for the loss of the
pawned jewelries is a virtual and uncritical reproduction of the
arguments set out on pp. 5-6 of the Appellants brief.[10]

Petitioners argue that the reproduced arguments of respondents

in their Appellants Brief suffer from infirmities, as follows:

(1) Respondents conclusively asserted in paragraph 2

of their Amended Complaint that Agencia de R.C. Sicam, Inc. is
the present owner of Agencia de R.C. Sicam Pawnshop, and
therefore, the CA cannot rule against said conclusive assertion
of respondents;

(2) The issue resolved against petitioner Sicam was not among
those raised and litigated in the trial court; and

(3) By reason of the above infirmities, it was error for the CA to

have pierced the corporate veil since a corporation has a
personality distinct and separate from its individual stockholders
or members.

Anent the second error, petitioners point out that the CA finding
on their negligence is likewise an unedited reproduction of
respondents brief which had the following defects:

(1) There were unrebutted evidence on record that petitioners

had observed the diligence required of them, i.e, they wanted to
open a vault with a nearby bank for purposes of safekeeping
the pawned articles but was discouraged by the Central Bank
(CB) since CB rules provide that they can only store the
pawned articles in a vault inside the pawnshop premises and
no other place;
 (2) Petitioners were adjudged negligent as they did not take
insurance against the loss of the pledged jelweries, but it is
judicial notice that due to high incidence of crimes, insurance
companies refused to cover pawnshops and banks because of
high probability of losses due to robberies;

(3) In Hernandez v. Chairman, Commission on Audit (179

SCRA 39, 45-46), the victim of robbery was exonerated from
liability for the sum of money belonging to others and lost by
him to robbers.

Respondents filed their Comment and petitioners filed their Reply

thereto. The parties subsequently submitted their respective
Memoranda.

We find no merit in the petition.

To begin with, although it is true that indeed the CA findings were

exact reproductions of the arguments raised in respondents
(appellants) brief filed with the CA, we find the same to be not
fatally infirmed. Upon examination of the Decision, we find that it
expressed clearly and distinctly the facts and the law on which it
is based as required by Section 8, Article VIII of the Constitution.
The discretion to decide a case one way or another is broad
enough to justify the adoption of the arguments put forth by one of
the parties, as long as these are legally tenable and supported by
law and the facts on records.[11]

Our jurisdiction under Rule 45 of the Rules of Court is limited to

the review of errors of law committed by the appellate
court. Generally, the findings of fact of the appellate court are
deemed conclusive and we are not duty-bound to analyze and
calibrate all over again the evidence adduced by the parties in the
court a quo.[12] This rule, however, is not without exceptions, such
as where the factual findings of the Court of Appeals and the trial
court are conflicting or contradictory[13] as is obtaining in the
instant case.

However, after a careful examination of the records, we find no

justification to absolve petitioner Sicam from liability.

The CA correctly pierced the veil of the corporate fiction and

adjudged petitioner Sicam liable together with petitioner
corporation. The rule is that the veil of corporate fiction may be
pierced when made as a shield to perpetrate fraud and/or confuse
legitimate issues. [14] The theory of corporate entity was not meant
to promote unfair objectives or otherwise to shield them.[15]

Notably, the evidence on record shows that at the time

respondent Lulu pawned her jewelry, the pawnshop was owned
by petitioner Sicam himself. As correctly observed by the CA, in
all the pawnshop receipts issued to respondent Lulu in September
1987, all bear the words Agencia de R. C. Sicam, notwithstanding
that the pawnshop was allegedly incorporated in April 1987. The
receipts issued after such alleged incorporation were still in the
name of Agencia de R. C. Sicam, thus inevitably misleading, or at
the very least, creating the wrong impression to respondents and
the public as well, that the pawnshop was owned solely by
petitioner Sicam and not by a corporation.

Even petitioners counsel, Atty. Marcial T. Balgos, in his

letter[16] dated October 15, 1987 addressed to the Central Bank,
expressly referred to petitioner Sicam as the proprietor of the
pawnshop notwithstanding the alleged incorporation in April
1987.
We also find no merit in petitioners' argument that since
respondents had alleged in their Amended Complaint
that petitioner corporation is the present owner of the pawnshop,
the CA is bound to decide the case on that basis.

Section 4 Rule 129 of the Rules of Court provides that an

admission, verbal or written, made by a party in the course of the
proceedings in the same case, does not require proof. The
admission may be contradicted only by showing that it was made
through palpable mistake or that no such admission was made.
Thus, the general rule that a judicial admission is conclusive upon
the party making it and does not require proof, admits of two
exceptions, to wit: (1) when it is shown that such admission was
made through palpable mistake, and (2) when it is shown that no
such admission was in fact made. The latter exception allows
one to contradict an admission by denying that he made
such an admission.[17]
The Committee on the Revision of the Rules of Court explained
the second exception in this wise:

x x x if a party invokes an admission by an adverse party, but

cites the admission out of context, then the one making the
admission may show that he made no such admission, or that
his admission was taken out of context.

x x x that the party can also show that he made no such

admission, i.e., not in the sense in which the admission is
made to appear.

That is the reason for the modifier such because if the rule
simply states that the admission may be contradicted by
showing that no admission was made, the rule would not really
be providing for a contradiction of the admission but just a
denial.[18] (Emphasis supplied).
While it is true that respondents alleged in their Amended
Complaint that petitioner corporation is the present owner of the
pawnshop, they did so only because petitioner Sicam alleged in
his Answer to the original complaint filed against him that he was
not the real party-in-interest as the pawnshop was incorporated in
April 1987. Moreover, a reading of the Amended Complaint in its
entirety shows that respondents referred to both
petitioner Sicam and petitioner corporation where they
(respondents) pawned their assorted pieces of jewelry and
ascribed to both the failure to observe due diligence
commensurate with the business which resulted in the loss of
their pawned jewelry.

Markedly, respondents, in their Opposition to petitioners Motion to

Dismiss Amended Complaint, insofar as petitioner Sicam is
concerned, averred as follows:

Roberto C. Sicam was named the defendant in the original

complaint because the pawnshop tickets involved in this case
did not show that the R.C. Sicam Pawnshop was a corporation.
In paragraph 1 of his Answer, he admitted the allegations in
paragraph 1 and 2 of the Complaint. He merely added that
defendant is not now the real party in interest in this case.
It was defendant Sicam's omission to correct the pawnshop
tickets used in the subject transactions in this case which was
the cause of the instant action. He cannot now ask for the
dismissal of the complaint against him simply on the mere
allegation that his pawnshop business is now incorporated. It is
a matter of defense, the merit of which can only be reached
after consideration of the evidence to be presented in due
course.[19]
Unmistakably, the alleged admission made in respondents'
Amended Complaint was taken out of context by
petitioner Sicam to suit his own purpose. Ineluctably, the fact that
petitioner Sicam continued to issue pawnshop receipts under his
name and not under the corporation's name militates for the
piercing of the corporate veil.
We likewise find no merit in petitioners' contention that the CA
erred in piercing the veil of corporate fiction of petitioner
corporation, as it was not an issue raised and litigated before the
RTC.

Petitioner Sicam had alleged in his Answer filed with the trial
court that he was not the real party-in-interest because since April
20, 1987, the pawnshop business initiated by him was
incorporated and known as Agencia de R.C. Sicam. In the pre-
trial brief filed by petitioner Sicam, he submitted that as far as he
was concerned, the basic issue was whether he is the real party
in interest against whom the complaint should be directed.[20] In
fact, he subsequently moved for the dismissal of the complaint as
to him but was not favorably acted upon by the trial court.
Moreover, the issue was squarely passed upon, although
erroneously, by the trial court in its Decision in this manner:

x x x The defendant Roberto Sicam, Jr likewise denies liability

as far as he is concerned for the reason that he cannot be
made personally liable for a claim arising from a corporate
transaction.

This Court sustains the contention of the defendant Roberto

C. Sicam, Jr. The amended complaint itself asserts that plaintiff
pawned assorted jewelries in defendant's pawnshop. It has
been held that as a consequence of the separate juridical
personality of a corporation, the corporate debt or credit is not
the debt or credit of the stockholder, nor is the stockholder's
debt or credit that of a corporation.[21]

Clearly, in view of the alleged incorporation of the pawnshop, the

issue of whether petitioner Sicam is personally liable is
inextricably connected with the determination of the question
whether the doctrine of piercing the corporate veil should or
should not apply to the case.

The next question is whether petitioners are liable for the

loss of the pawned articles in their possession.

Petitioners insist that they are not liable since robbery is a

fortuitous event and they are not negligent at all.

We are not persuaded.

Article 1174 of the Civil Code provides:

Art. 1174. Except in cases expressly specified by the law, or

when it is otherwise declared by stipulation, or when the nature
of the obligation requires the assumption of risk, no person shall
be responsible for those events which could not be foreseen or
which, though foreseen, were inevitable.

Fortuitous events by definition are extraordinary events not

foreseeable or avoidable. It is therefore, not enough that the event
should not have been foreseen or anticipated, as is commonly
believed but it must be one impossible to foresee or to avoid. The
mere difficulty to foresee the happening is not impossibility to
foresee the same. [22]

To constitute a fortuitous event, the following elements must

concur: (a) the cause of the unforeseen and unexpected
occurrence or of the failure of the debtor to comply with
obligations must be independent of human will; (b) it must be
impossible to foresee the event that constitutes
the caso fortuito or, if it can be foreseen, it must be impossible to
avoid; (c) the occurrence must be such as to render it impossible
for the debtor to fulfill obligations in a normal manner; and, (d) the
obligor must be free from any participation in the aggravation of
the injury or loss. [23]
The burden of proving that the loss was due to a fortuitous event
rests on him who invokes it.[24] And, in order for a fortuitous event
to exempt one from liability, it is necessary that one has
committed no negligence or misconduct that may have
occasioned the loss. [25]

It has been held that 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. [26]

Petitioner Sicam had testified that there was a security guard in

their pawnshop at the time of the robbery. He likewise testified
that when he started the pawnshop business in 1983, he thought
of opening a vault with the nearby bank for the purpose of
safekeeping the valuables but was discouraged by the Central
Bank since pawned articles should only be stored in a vault inside
the pawnshop. The very measures which petitioners had allegedly
adopted show that to them the possibility of robbery was not only
foreseeable, but actually foreseen and
anticipated. Petitioner Sicams testimony, in effect, contradicts
petitioners defense of fortuitous event.
Moreover, petitioners failed to show that they were free from any
negligence by which the loss of the pawned jewelry may have
been occasioned.

Robbery per se, just like carnapping, is not a fortuitous event. It

does not foreclose the possibility of negligence on the part of
herein petitioners. In Co v. Court of Appeals,[27] the Court held:

It is not a defense for a repair shop of motor vehicles to

escape liability simply because the damage or loss of a thing
lawfully placed in its possession was due
to carnapping. Carnapping per se cannot be considered as a
fortuitous event. The fact that a thing was unlawfully and
forcefully taken from another's rightful possession, as in
cases of carnapping, does not automatically give rise to a
fortuitous event. To be considered as
such, carnapping entails more than the mere forceful
taking of another's property. It must be proved and
established that the event was an act of God or was done
solely by third parties and that neither the claimant nor the
person alleged to be negligent has any participation. In
accordance with the Rules of Evidence, the burden of
proving that the loss was due to a fortuitous event rests
on him who invokes it which in this case is the private
respondent. However, other than the police report of the
alleged carnapping incident, no other evidence was presented
by private respondent to the effect that the incident was not
due to its fault. A police report of an alleged crime, to which
only private respondent is privy, does not suffice to establish
the carnapping. Neither does it prove that there was no fault on
the part of private respondent notwithstanding the parties'
agreement at the pre-trial that the car
was carnapped. Carnapping does not foreclose the possibility
of fault or negligence on the part of private respondent.[28]
Just like in Co, petitioners merely presented the police
report of the Paraaque Police Station on the robbery committed
based on the report of petitioners' employees which is not
sufficient to establish robbery. Such report also does not prove
that petitioners were not at fault.

On the contrary, by the very evidence of petitioners, the CA did

not err in finding that petitioners are guilty of concurrent or
contributory negligence as provided in Article 1170 of the Civil
Code, to wit:

Art. 1170. 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.[29]

Article 2123 of the Civil Code provides that with regard to

pawnshops and other establishments which are engaged in
making loans secured by pledges, the special laws and
regulations concerning them shall be observed, and subsidiarily,
the provisions on pledge, mortgage and antichresis.

The provision on pledge, particularly Article 2099 of the Civil

Code, provides that the creditor shall take care of the thing
pledged with the diligence of a good father of a family. This
means that petitioners must take care of the pawns the way a
prudent person would as to his own property.

In this connection, Article 1173 of the Civil Code further provides:

Art. 1173. The fault or negligence of the obligor consists in the

omission of that diligence which is required by the nature of the
obligation and corresponds with the circumstances of the
persons, of time and of the place. When negligence shows bad
faith, the provisions of Articles 1171 and 2201, paragraph 2
shall apply.
 If the law or contract does not state the diligence which is
to be observed in the performance, that which is expected of
a good father of a family shall be required.
We expounded in Cruz v. Gangan[30] that 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.[31] It is want of care
required by the circumstances.

A review of the records clearly shows that petitioners failed to

exercise reasonable care and caution that an ordinarily prudent
person would have used in the same situation. Petitioners were
guilty of negligence in the operation of their pawnshop business.
Petitioner Sicam testified, thus:

Court:
Q. Do you have security guards in your pawnshop?
A. Yes, your honor.

Q. Then how come that the robbers were able to enter the
premises when according to you there was a security guard?
A. Sir, if these robbers can rob a bank, how much more a
pawnshop.

Q. I am asking you how were the robbers able to enter despite

the fact that there was a security guard?
A. At the time of the incident which happened about 1:00 and
2:00 o'clock in the afternoon and it happened on a Saturday
and everything was quiet in the area BF
Homes Paraaque they pretended to pawn an article in the
pawnshop, so one of my employees allowed him to come in
and it was only when it was announced that it was a hold up.

Q. Did you come to know how the vault was opened?

 A. When the pawnshop is official (sic) open your honor the
pawnshop is partly open. The combination is off.

Q. No one open (sic) the vault for the robbers?

A. No one your honor it was open at the time of the robbery.

Q. It is clear now that at the time of the robbery the vault was
open the reason why the robbers were able to get all the
items pawned to you inside the vault.
A. Yes sir.[32]

revealing that there were no security measures adopted by

petitioners in the operation of the pawnshop. Evidently, no
sufficient precaution and vigilance were adopted by petitioners to
protect the pawnshop from unlawful intrusion. There was no clear
showing that there was any security guard at all. Or if there was
one, that he had sufficient training in securing a
pawnshop. Further, there is no showing that the alleged security
guard exercised all that was necessary to prevent any untoward
incident or to ensure that no suspicious individuals were allowed
to enter the premises. In fact, it is even doubtful that there was a
security guard, since it is quite impossible that he would not have
noticed that the robbers were armed with caliber .45 pistols each,
which were allegedly poked at the employees.[33] Significantly, the
alleged security guard was not presented at all to corroborate
petitioner Sicam's claim; not one of petitioners' employees who
were present during the robbery incident testified in court.

Furthermore, petitioner Sicam's admission that the vault was

open at the time of robbery is clearly a proof of petitioners' failure
to observe the care, precaution and vigilance that the
circumstances justly demanded. Petitioner Sicam testified that
once the pawnshop was open, the combination was already
off. Considering petitioner Sicam's testimony that the robbery took
place on a Saturday afternoon and the area in BF
Homes Paraaque at that time was quiet, there was more reason
for petitioners to have exercised reasonable foresight and
diligence in protecting the pawned jewelries. Instead of taking the
precaution to protect them, they let open the vault, providing no
difficulty for the robbers to cart away the pawned articles.

We, however, do not agree with the CA when it

found petitioners negligent for not taking steps to insure
themselves against loss of the pawned jewelries.

Under Section 17 of Central Bank Circular No. 374, Rules and

Regulations for Pawnshops, which took effect on July 13,
1973, and which was issued pursuant to Presidential Decree No.
114, Pawnshop Regulation Act, it is provided that pawns pledged
must be insured, to wit:

Sec. 17. Insurance of Office Building and Pawns- The place of

business of a pawnshop and the pawns pledged to it must be
insured against fire and against burglary as well as for
the latter(sic), by an insurance company accredited by the
Insurance Commissioner.

However, this Section was subsequently amended by CB Circular

No. 764 which took effect on October 1, 1980, to wit:

Sec. 17 Insurance of Office Building and Pawns The office

building/premises and pawns of a pawnshop must be
insured against fire. (emphasis supplied).
where the requirement that insurance against burglary was
deleted. Obviously, the Central Bank considered it not feasible
to require insurance of pawned articles against burglary.
The robbery in the pawnshop happened in 1987, and considering
the above-quoted amendment, there is no statutory duty imposed
on petitioners to insure the pawned jewelry in which case it was
error for the CA to consider it as a factor in concluding that
petitioners were negligent.

Nevertheless, the preponderance of evidence shows that

petitioners failed to exercise the diligence required of them under
the Civil Code.
The diligence with which the law requires the individual at all
times to govern his conduct varies with the nature of the situation
in which he is placed and the importance of the act which he is to
perform.[34] Thus, the cases of Austria v. Court of
Appeals,[35] Hernandez v. Chairman, Commission on
[36] [37]
Audit and Cruz v. Gangan cited by petitioners in their
pleadings, where the victims of robbery were exonerated from
liability, find no application to the present case.

In Austria, Maria Abad received from Guillermo Austria a pendant

with diamonds to be sold on commission basis, but
which Abad failed to subsequently return because of a robbery
committed upon her in 1961. The incident became the subject of
a criminal case filed against several persons. Austria filed an
action against Abad and her husband (Abads) for recovery of the
pendant or its value, but the Abads set up the defense that the
robbery extinguished their obligation. The RTC ruled in favor
of Austria, as the Abads failed to prove robbery; or, if committed,
that Maria Abad was guilty of negligence. The CA, however,
reversed the RTC decision holding that the fact of robbery was
duly established and declared the Abads not responsible for the
loss of the jewelry on account of a fortuitous event. We
held that for the Abads to be relieved from the civil liability of
returning the pendant under Art. 1174 of the Civil Code, it would
only be sufficient that the unforeseen event, the robbery, took
place without any concurrent fault on the debtors part, and this
can be done by preponderance of evidence; that to be free from
liability for reason of fortuitous event, the debtor must, in addition
to the casus itself, be free of any concurrent or contributory fault
or negligence.[38]

We found in Austria that under the circumstances prevailing at the

time the Decision was promulgated in 1971, the City of Manila
and its suburbs had a high incidence of crimes against persons
and property that rendered travel after nightfall a matter to be
sedulously avoided without suitable precaution and protection;
that the conduct of Maria Abad in returning alone to her house in
the evening carrying jewelry of considerable value would have
been negligence per se and would not exempt her from
responsibility in the case of robbery. However we did not
hold Abad liable for negligence since, the robbery happened ten
years previously; i.e., 1961, when criminality had not reached the
level of incidence obtaining in 1971.
In contrast, the robbery in this case took place in 1987 when
robbery was already prevalent and petitioners in fact had already
foreseen it as they wanted to deposit the pawn with a nearby
bank for safekeeping. Moreover, unlike in Austria, where no
negligence was committed, we found petitioners negligent in
securing their pawnshop as earlier discussed.

In Hernandez, Teodoro Hernandez was the OIC and special

disbursing officer of the Ternate Beach Project of the Philippine
Tourism in Cavite. In the morning of July 1, 1983, a Friday, he
went to Manila to encash two checks covering the wages of the
employees and the operating expenses of the project. However
for some reason, the processing of the check was delayed and
was completed at about 3 p.m. Nevertheless, he decided
to encash the check because the project employees would be
waiting for their pay the following day; otherwise, the workers
would have to wait until July 5, the earliest time, when the main
office would open. At that time, he had two choices: (1) return
to Ternate, Cavite that same afternoon and arrive early evening;
or (2) take the money with him to his house in Marilao, Bulacan,
spend the night there, and leave for Ternate the following day. He
chose the second option, thinking it was the safer one. Thus, a
little past 3 p.m., he took a passenger jeep bound for Bulacan.
While the jeep was on Epifanio de los Santos Avenue, the jeep
was held up and the money kept by Hernandez was taken, and
the robbers jumped out of the jeep and ran. Hernandez chased
the robbers and caught up with one robber who was subsequently
charged with robbery and pleaded guilty. The other robber who
held the stolen money escaped. The Commission on Audit found
Hernandez negligent because he had not brought the cash
proceeds of the checks to his office in Ternate, Cavite for
safekeeping, which is the normal procedure in the handling of
funds. We held that Hernandez was not negligent in deciding
to encash the check and bringing it home
to Marilao, Bulacan instead of Ternate, Cavite due to the lateness
of the hour for the following reasons: (1) he was moved by
unselfish motive for his co-employees to collect their wages and
salaries the following day, a Saturday, a non-working, because
to encash the check on July 5, the next working day after July 1,
would have caused discomfort to laborers who were dependent
on their wages for sustenance; and (2) that choosing Marilao as a
safer destination, being nearer, and in view of the comparative
hazards in the trips to the two places, said decision seemed
logical at that time. We further held that the fact that two robbers
attacked him in broad daylight in the jeep while it was on a busy
highway and in the presence of other passengers could not be
said to be a result of his imprudence and negligence.

Unlike in Hernandez where the robbery happened in a public

utility, the robbery in this case took place in the pawnshop which
is under the control of petitioners. Petitioners had the means to
screen the persons who were allowed entrance to the premises
and to protect itself from unlawful intrusion. Petitioners had failed
to exercise precautionary measures in ensuring that the robbers
were prevented from entering the pawnshop and for keeping the
vault open for the day, which paved the way for the robbers to
easily cart away the pawned articles.

In Cruz, Dr. Filonila O. Cruz, Camanava District Director of

Technological Education and Skills Development Authority
(TESDA), boarded the Light Rail Transit (LRT)
from Sen. Puyat Avenue to Monumento when her handbag was
slashed and the contents were stolen by an unidentified person.
Among those stolen were her wallet and the government-issued
cellular phone. She then reported the incident to the police
authorities; however, the thief was not located, and
the cellphone was not recovered. She also reported the loss to
the Regional Director of TESDA, and she requested that she be
freed from accountability for the cellphone. The Resident Auditor
denied her request on the ground that she lacked the diligence
required in the custody of government property and was ordered
to pay the purchase value in the total amount of P4,238.00. The
COA found no sufficient justification to grant the request for relief
from accountability. We reversed the ruling and found that riding
the LRT cannot per se be denounced as a negligent act more so
because Cruzs mode of transit was influenced by time and money
considerations; that she boarded the LRT to be able to arrive
in Caloocan in time for her 3 pm meeting; that any prudent and
rational person under similar circumstance can reasonably be
expected to do the same; that possession of a cellphone should
not hinder one from boarding the LRT coach as Cruz did
considering that whether she rode a jeep or bus, the risk of theft
would have also been present; that because of her relatively low
position and pay, she was not expected to have her own vehicle
or to ride a taxicab; she did not have a government assigned
vehicle; that placing the cellphone in a bag away from covetous
eyes and holding on to that bag as she did is ordinarily sufficient
care of a cellphone while traveling on board the LRT; that the
records did not show any specific act of negligence on her part
and negligence can never be presumed.

Unlike in the Cruz case, the robbery in this case happened in

petitioners' pawnshop and they were negligent in not exercising
the precautions justly demanded of a pawnshop.

WHEREFORE, except for the insurance aspect, the Decision

of the Court of Appeals dated March 31, 2003 and its Resolution
dated August 8, 2003, are AFFIRMED.

Costs against petitioners.

SO ORDERED.

MA. ALICIA AUSTRIA-MARTINEZ

Associate Justice

WE CONCUR:
Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-4977 March 22, 1910

DAVID TAYLOR, plaintiff-appellee,
vs.
THE MANILA ELECTRIC RAILROAD AND LIGHT COMPANY, defendant-appellant.

W. H. Lawrence, for appellant.

W. L. Wright, for appellee.

CARSON, J.:

An action to recover damages for the loss of an eye and other injuries, instituted by
David Taylor, a minor, by his father, his nearest relative.

The defendant is a foreign corporation engaged in the operation of a street railway and
an electric light system in the city of Manila. Its power plant is situated at the eastern
end of a small island in the Pasig River within the city of Manila, known as the Isla del
Provisor. The power plant may be reached by boat or by crossing a footbridge,
impassable for vehicles, at the westerly end of the island.

The plaintiff, David Taylor, was at the time when he received the injuries complained of,
15 years of age, the son of a mechanical engineer, more mature than the average boy
of his age, and having considerable aptitude and training in mechanics.

On the 30th of September, 1905, plaintiff, with a boy named Manuel Claparols, about 12
years of age, crossed the footbridge to the Isla del Provisor, for the purpose of visiting
one Murphy, an employee of the defendant, who and promised to make them a cylinder
for a miniature engine. Finding on inquiry that Mr. Murphy was not in his quarters, the
boys, impelled apparently by youthful curiosity and perhaps by the unusual interest
which both seem to have taken in machinery, spent some time in wandering about the
company's premises. The visit was made on a Sunday afternoon, and it does not
appear that they saw or spoke to anyone after leaving the power house where they had
asked for Mr. Murphy.

After watching the operation of the travelling crane used in handling the defendant's
coal, they walked across the open space in the neighborhood of the place where the
company dumped in the cinders and ashes from its furnaces. Here they found some
twenty or thirty brass fulminating caps scattered on the ground. These caps are
approximately of the size and appearance of small pistol cartridges and each has
attached to it two long thin wires by means of which it may be discharged by the use of
electricity. They are intended for use in the explosion of blasting charges of dynamite,
and have in themselves a considerable explosive power. After some discussion as to
the ownership of the caps, and their right to take them, the boys picked up all they could
find, hung them on stick, of which each took end, and carried them home. After crossing
the footbridge, they met a little girl named Jessie Adrian, less than 9 years old, and all
three went to the home of the boy Manuel. The boys then made a series of experiments
with the caps. They trust the ends of the wires into an electric light socket and obtained
no result. They next tried to break the cap with a stone and failed. Manuel looked for a
hammer, but could not find one. Then they opened one of the caps with a knife, and
finding that it was filled with a yellowish substance they got matches, and David held the
cap while Manuel applied a lighted match to the contents. An explosion followed,
causing more or less serious injuries to all three. Jessie, who when the boys proposed
putting a match to the contents of the cap, became frightened and started to run away,
received a slight cut in the neck. Manuel had his hand burned and wounded, and David
was struck in the face by several particles of the metal capsule, one of which injured his
right eye to such an extent as to the necessitate its removal by the surgeons who were
called in to care for his wounds.

The evidence does definitely and conclusively disclose how the caps came to be on the
defendant's premises, nor how long they had been there when the boys found them. It
appears, however, that some months before the accident, during the construction of the
defendant's plant, detonating caps of the same size and kind as those found by the
boys were used in sinking a well at the power plant near the place where the caps were
found; and it also appears that at or about the time when these caps were found,
similarly caps were in use in the construction of an extension of defendant's street car
line to Fort William McKinley. The caps when found appeared to the boys who picked
them up to have been lying for a considerable time, and from the place where they were
found would seem to have been discarded as detective or worthless and fit only to be
thrown upon the rubbish heap.

No measures seems to have been adopted by the defendant company to prohibit or

prevent visitors from entering and walking about its premises unattended, when they felt
disposed so to do. As admitted in defendant counsel's brief, "it is undoubtedly true that
children in their play sometimes crossed the foot bridge to the islands;" and, we may
add, roamed about at will on the uninclosed premises of the defendant, in the
neighborhood of the place where the caps were found. There is evidence that any effort
ever was made to forbid these children from visiting the defendant company's premises,
although it must be assumed that the company or its employees were aware of the fact
that they not infrequently did so.

Two years before the accident, plaintiff spent four months at sea, as a cabin boy on one
of the interisland transports. Later he took up work in his father's office, learning
mechanical drawing and mechanical engineering. About a month after his accident he
obtained employment as a mechanical draftsman and continued in that employment for
six months at a salary of P2.50 a day; and it appears that he was a boy of more than
average intelligence, taller and more mature both mentally and physically than most
boys of fifteen.

The facts set out in the foregoing statement are to our mind fully and conclusively
established by the evidence of record, and are substantially admitted by counsel. The
only questions of fact which are seriously disputed are plaintiff's allegations that the
caps which were found by plaintiff on defendant company's premises were the property
of the defendant, or that they had come from its possession and control, and that the
company or some of its employees left them exposed on its premises at the point where
they were found.

The evidence in support of these allegations is meager, and the defendant company,
apparently relying on the rule of law which places the burden of proof of such
allegations upon the plaintiff, offered no evidence in rebuttal, and insists that plaintiff
failed in his proof. We think, however, that plaintiff's evidence is sufficient to sustain a
finding in accord with his allegations in this regard.

It was proven that caps, similar to those found by plaintiff, were used, more or less
extensively, on the McKinley extension of the defendant company's track; that some of
these caps were used in blasting a well on the company's premises a few months
before the accident; that not far from the place where the caps were found the company
has a storehouse for the materials, supplies and so forth, used by it in its operations as
a street railway and a purveyor of electric light; and that the place, in the neighborhood
of which the caps were found, was being used by the company as a sort of dumping
ground for ashes and cinders. Fulminating caps or detonators for the discharge by
electricity of blasting charges by dynamite are not articles in common use by the
average citizen, and under all the circumstances, and in the absence of all evidence to
the contrary, we think that the discovery of twenty or thirty of these caps at the place
where they were found by the plaintiff on defendant's premises fairly justifies the
inference that the defendant company was either the owner of the caps in question or
had the caps under its possession and control. We think also that the evidence tends to
disclose that these caps or detonators were willfully and knowingly thrown by the
company or its employees at the spot where they were found, with the expectation that
they would be buried out of the sight by the ashes which it was engaged in dumping in
that neighborhood, they being old and perhaps defective; and, however this may be, we
are satisfied that the evidence is sufficient to sustain a finding that the company or some
of its employees either willfully or through an oversight left them exposed at a point on
its premises which the general public, including children at play, where not prohibited
from visiting, and over which the company knew or ought to have known that young
boys were likely to roam about in pastime or in play.

Counsel for appellant endeavors to weaken or destroy the probative value of the facts
on which these conclusions are based by intimidating or rather assuming that the
blasting work on the company's well and on its McKinley extension was done by
contractors. It was conclusively proven, however, that while the workman employed in
blasting the well was regularly employed by J. G. White and Co., a firm of contractors,
he did the work on the well directly and immediately under the supervision and control
of one of defendant company's foremen, and there is no proof whatever in the record
that the blasting on the McKinley extension was done by independent contractors. Only
one witness testified upon this point, and while he stated that he understood that a part
of this work was done by contract, he could not say so of his own knowledge, and knew
nothing of the terms and conditions of the alleged contract, or of the relations of the
alleged contractor to the defendant company. The fact having been proven that
detonating caps were more or less extensively employed on work done by the
defendant company's directions and on its behalf, we think that the company should
have introduced the necessary evidence to support its contention if it wished to avoid
the not unreasonable inference that it was the owner of the material used in these
operations and that it was responsible for tortious or negligent acts of the agents
employed therein, on the ground that this work had been intrusted to independent
contractors as to whose acts the maxim respondent superior should not be applied. If
the company did not in fact own or make use of caps such as those found on its
premises, as intimated by counsel, it was a very simple matter for it to prove that fact,
and in the absence of such proof we think that the other evidence in the record
sufficiently establishes the contrary, and justifies the court in drawing the reasonable
inference that the caps found on its premises were its property, and were left where
they were found by the company or some of its employees.

Plaintiff appears to have rested his case, as did the trial judge his decision in plaintiff's
favor, upon the provisions of article 1089 of the Civil Code read together with articles
1902, 1903, and 1908 of that code.

ART. 1089 Obligations are created by law, by contracts, by quasi-contracts, and

illicit acts and omissions or by those in which any kind of fault or negligence
occurs.

ART. 1902 A person who by an act or omission causes damage to another when
there is fault or negligence shall be obliged to repair the damage so done.

ART. 1903 The obligation imposed by the preceding article is demandable, not
only for personal acts and omissions, but also for those of the persons for whom
they should be responsible.

The father, and on his death or incapacity the mother, is liable for the damages
caused by the minors who live with them.

xxx xxx xxx

Owners or directors of an establishment or enterprise are equally liable for

damages caused by their employees in the service of the branches in which the
latter may be employed or on account of their duties.

xxx xxx xxx

The liability referred to in this article shall cease when the persons mentioned
therein prove that they employed all the diligence of a good father of a family to
avoid the damage.

ART. 1908 The owners shall also be liable for the damage caused —
 1 By the explosion of machines which may not have been cared for with due
diligence, and for kindling of explosive substances which may not have been
placed in a safe and proper place.

Counsel for the defendant and appellant rests his appeal strictly upon his contention
that the facts proven at the trial do not established the liability of the defendant company
under the provisions of these articles, and since we agree with this view of the case, it is
not necessary for us to consider the various questions as to form and the right of action
(analogous to those raised in the case of Rakes vs. Atlantic, Gulf and Pacific Co., 7 Phil.
Rep., 359), which would, perhaps, be involved in a decision affirming the judgment of
the court below.

We agree with counsel for appellant that under the Civil Code, as under the generally
accepted doctrine in the United States, the plaintiff in an action such as that under
consideration, in order to establish his right to a recovery, must establish by competent
evidence:

(1) Damages to the plaintiff.

(2) Negligence by act or omission of which defendant personally, or some person

for whose acts it must respond, was guilty.

(3) The connection of cause and effect between the negligence and the damage.

These proposition are, of course, elementary, and do not admit of discussion, the real
difficulty arising in the application of these principles to the particular facts developed in
the case under consideration.

It is clear that the accident could not have happened and not the fulminating caps been
left exposed at the point where they were found, or if their owner had exercised due
care in keeping them in an appropriate place; but it is equally clear that plaintiff would
not have been injured had he not, for his own pleasure and convenience, entered upon
the defendant's premises, and strolled around thereon without the express permission
of the defendant, and had he not picked up and carried away the property of the
defendant which he found on its premises, and had he not thereafter deliberately cut
open one of the caps and applied a match to its contents.

But counsel for plaintiff contends that because of plaintiff's youth and inexperience, his
entry upon defendant company's premises, and the intervention of his action between
the negligent act of defendant in leaving the caps exposed on its premises and the
accident which resulted in his injury should not be held to have contributed in any wise
to the accident, which should be deemed to be the direct result of defendant's
negligence in leaving the caps exposed at the place where they were found by the
plaintiff, and this latter the proximate cause of the accident which occasioned the
injuries sustained by him.
In support of his contention, counsel for plaintiff relies on the doctrine laid down in many
of the courts of last resort in the United States in the cases known as the "Torpedo" and
"Turntable" cases, and the cases based thereon.

In a typical cases, the question involved has been whether a railroad company is liable
for an injury received by an infant of tender years, who from mere idle curiosity, or for
the purposes of amusement, enters upon the railroad company's premises, at a place
where the railroad company knew, or had good reason to suppose, children would be
likely to come, and there found explosive signal torpedoes left unexposed by the
railroad company's employees, one of which when carried away by the visitor, exploded
and injured him; or where such infant found upon the premises a dangerous machine,
such as a turntable, left in such condition as to make it probable that children in playing
with it would be exposed to accident or injury therefrom and where the infant did in fact
suffer injury in playing with such machine.

In these, and in great variety of similar cases, the great weight of authority holds the
owner of the premises liable.

As laid down in Railroad Co. vs. Stout (17 Wall. (84 U. S.), 657), wherein the principal
question was whether a railroad company was liable for in injury received by an infant
while upon its premises, from idle curiosity, or for purposes of amusement, if such injury
was, under circumstances, attributable to the negligence of the company), the principles
on which these cases turn are that "while a railroad company is not bound to the same
degree of care in regard to mere strangers who are unlawfully upon its premises that it
owes to passengers conveyed by it, it is not exempt from responsibility to such
strangers for injuries arising from its negligence or from its tortious acts;" and that "the
conduct of an infant of tender years is not to be judged by the same rule which governs
that of adult. While it is the general rule in regard to an adult that to entitle him to
recover damages for an injury resulting from the fault or negligence of another he must
himself have been free from fault, such is not the rule in regard to an infant of tender
years. The care and caution required of a child is according to his maturity and capacity
only, and this is to be determined in each case by the circumstances of the case."

The doctrine of the case of Railroad Company vs. Stout was vigorously controverted
and sharply criticized in several state courts, and the supreme court of Michigan in the
case of Ryan vs. Towar (128 Mich., 463) formally repudiated and disapproved the
doctrine of the Turntable cases, especially that laid down in Railroad Company vs.
Stout, in a very able decision wherein it held, in the language of the syllabus: (1) That
the owner of the land is not liable to trespassers thereon for injuries sustained by them,
not due to his wanton or willful acts; (2) that no exception to this rule exists in favor of
children who are injured by dangerous machinery naturally calculated to attract them to
the premises; (3) that an invitation or license to cross the premises of another can not
be predicated on the mere fact that no steps have been taken to interfere with such
practice; (4) that there is no difference between children and adults as to the
circumstances that will warrant the inference of an invitation or a license to enter upon
another's premises.
Similar criticisms of the opinion in the case of Railroad Company vs. Stout were
indulged in by the courts in Connecticut and Massachusetts. (Nolan vs. Railroad Co., 53
Conn., 461; 154 Mass., 349). And the doctrine has been questioned in Wisconsin,
Pennsylvania, New Hampshire, and perhaps in other States.

On the other hand, many if not most of the courts of last resort in the United States,
citing and approving the doctrine laid down in England in the leading case of Lynch vs.
Nurding (1 Q. B., 29, 35, 36), lay down the rule in these cases in accord with that
announced in the Railroad Company vs. Stout (supra), and the Supreme Court of the
United States, in a unanimous opinion delivered by Justice Harlan in the case of Union
Pacific Railway Co. vs. McDonal and reconsidered the doctrine laid down in Railroad
Co. vs. Stout, and after an exhaustive and critical analysis and review of many of the
adjudged cases, both English and American, formally declared that it adhered "to the
principles announced in the case of Railroad Co. vs. Stout."

In the case of Union Pacific Railway Co. vs. MacDonald (supra) the facts were as
follows: The plaintiff, a boy 12 years of age, out of curiosity and for his own pleasure,
entered upon and visited the defendant's premises, without defendant's express
permission or invitation, and while there, was by accident injured by falling into a
burning slack pile of whose existence he had no knowledge, but which had been left by
defendant on its premises without any fence around it or anything to give warning of its
dangerous condition, although defendant knew or had reason the interest or curiosity of
passers-by. On these facts the court held that the plaintiff could not be regarded as a
mere trespasser, for whose safety and protection while on the premises in question,
against the unseen danger referred to, the defendant was under no obligation to make
provision.

We quote at length from the discussion by the court of the application of the principles
involved to the facts in that case, because what is said there is strikingly applicable in
the case at bar, and would seem to dispose of defendant's contention that, the plaintiff
in this case being a trespasser, the defendant company owed him no duty, and in no
case could be held liable for injuries which would not have resulted but for the entry of
plaintiff on defendant's premises.

We adhere to the principles announced in Railroad Co. vs. Stout (supra). Applied
to the case now before us, they require us to hold that the defendant was guilty
of negligence in leaving unguarded the slack pile, made by it in the vicinity of its
depot building. It could have forbidden all persons from coming to its coal mine
for purposes merely of curiosity and pleasure. But it did not do so. On the
contrary, it permitted all, without regard to age, to visit its mine, and witness its
operation. It knew that the usual approach to the mine was by a narrow path
skirting its slack pit, close to its depot building, at which the people of the village,
old and young, would often assemble. It knew that children were in the habit of
frequenting that locality and playing around the shaft house in the immediate
vicinity of the slack pit. The slightest regard for the safety of these children would
have suggested that they were in danger from being so near a pit, beneath the
 surface of which was concealed (except when snow, wind, or rain prevailed) a
mass of burning coals into which a child might accidentally fall and be burned to
death. Under all the circumstances, the railroad company ought not to be heard
to say that the plaintiff, a mere lad, moved by curiosity to see the mine, in the
vicinity of the slack pit, was a trespasser, to whom it owed no duty, or for whose
protection it was under no obligation to make provisions.

In Townsend vs. Wathen (9 East, 277, 281) it was held that if a man dangerous
traps, baited with flesh, in his own ground, so near to a highway, or to the
premises of another, that dogs passing along the highway, or kept in his
neighbors premises, would probably be attracted by their instinct into the traps,
and in consequence of such act his neighbor's dogs be so attracted and thereby
injured, an action on the case would lie. "What difference," said Lord
Ellenborough, C.J., "is there in reason between drawing the animal into the trap
by means of his instinct which he can not resist, and putting him there by manual
force?" What difference, in reason we may observe in this case, is there between
an express license to the children of this village to visit the defendant's coal mine,
in the vicinity of its slack pile, and an implied license, resulting from the habit of
the defendant to permit them, without objection or warning, to do so at will, for
purposes of curiosity or pleasure? Referring it the case of Townsend vs. Wathen,
Judge Thompson, in his work on the Law of Negligence, volume 1, page 305,
note, well says: "It would be a barbarous rule of law that would make the owner
of land liable for setting a trap thereon, baited with stinking meat, so that his
neighbor's dog attracted by his natural instinct, might run into it and be killed, and
which would exempt him from liability for the consequence of leaving exposed
and unguarded on his land a dangerous machine, so that his neighbor's child
attracted to it and tempted to intermeddle with it by instincts equally strong, might
thereby be killed or maimed for life."

Chief Justice Cooley, voicing the opinion of the supreme court of Michigan, in the case
of Powers vs. Harlow (53 Mich., 507), said that (p. 515):

Children, wherever they go, must be expected to act upon childlike instincts and
impulses; and others who are chargeable with a duty of care and caution toward
them must calculate upon this, and take precautions accordingly. If they leave
exposed to the observation of children anything which would be tempting to
them, and which they in their immature judgment might naturally suppose they
were at liberty to handle or play with, they should expect that liberty to be taken.

And the same eminent jurist in his treatise or torts, alluding to the doctrine of implied
invitation to visit the premises of another, says:

In the case of young children, and other persons not fully sui juris, an implied
license might sometimes arise when it would not on behalf of others. Thus
leaving a tempting thing for children to play with exposed, where they would be
likely to gather for that purpose, may be equivalent to an invitation to them to
 make use of it; and, perhaps, if one were to throw away upon his premises, near
the common way, things tempting to children, the same implication should arise.
(Chap. 10, p. 303.)

The reasoning which led the Supreme Court of the United States to its conclusion in the
cases of Railroad Co. vs. Stout (supra) and Union Pacific Railroad Co. vs.
McDonald (supra) is not less cogent and convincing in this jurisdiction than in that
wherein those cases originated. Children here are actuated by similar childish instincts
and impulses. Drawn by curiosity and impelled by the restless spirit of youth, boys here
as well as there will usually be found whenever the public is permitted to congregate.
The movement of machinery, and indeed anything which arouses the attention of the
young and inquiring mind, will draw them to the neighborhood as inevitably as does the
magnet draw the iron which comes within the range of its magnetic influence. The
owners of premises, therefore, whereon things attractive to children are exposed, or
upon which the public are expressly or impliedly permitted to enter or upon which the
owner knows or ought to know children are likely to roam about for pastime and in play,
" must calculate upon this, and take precautions accordingly." In such cases the owner
of the premises can not be heard to say that because the child has entered upon his
premises without his express permission he is a trespasser to whom the owner owes no
duty or obligation whatever. The owner's failure to take reasonable precautions to
prevent the child from entering his premises at a place where he knows or ought to
know that children are accustomed to roam about of to which their childish instincts and
impulses are likely to attract them is at least equivalent to an implied license to enter,
and where the child does enter under such conditions the owner's failure to take
reasonable precautions to guard the child against injury from unknown or unseen
dangers, placed upon such premises by the owner, is clearly a breach of duty,
responsible, if the child is actually injured, without other fault on its part than that it had
entered on the premises of a stranger without his express invitation or permission. To
hold otherwise would be expose all the children in the community to unknown perils and
unnecessary danger at the whim of the owners or occupants of land upon which they
might naturally and reasonably be expected to enter.

This conclusion is founded on reason, justice, and necessity, and neither is contention
that a man has a right to do what will with his own property or that children should be
kept under the care of their parents or guardians, so as to prevent their entering on the
premises of others is of sufficient weight to put in doubt. In this jurisdiction as well as in
the United States all private property is acquired and held under the tacit condition that
it shall not be so used as to injure the equal rights and interests of the community (see
U. S. vs. Toribio,1 No. 5060, decided January 26, 1910), and except as to infants of very
tender years it would be absurd and unreasonable in a community organized as is that
in which we lived to hold that parents or guardian are guilty of negligence or imprudence
in every case wherein they permit growing boys and girls to leave the parental roof
unattended, even if in the event of accident to the child the negligence of the parent
could in any event be imputed to the child so as to deprive it a right to recover in such
cases — a point which we neither discuss nor decide.
But while we hold that the entry of the plaintiff upon defendant's property without
defendant's express invitation or permission would not have relieved defendant from
responsibility for injuries incurred there by plaintiff, without other fault on his part, if such
injury were attributable to the negligence of the defendant, we are of opinion that under
all the circumstances of this case the negligence of the defendant in leaving the caps
exposed on its premises was not the proximate cause of the injury received by the
plaintiff, which therefore was not, properly speaking, "attributable to the negligence of
the defendant," and, on the other hand, we are satisfied that plaintiffs action in cutting
open the detonating cap and putting match to its contents was the proximate cause of
the explosion and of the resultant injuries inflicted upon the plaintiff, and that the
defendant, therefore is not civilly responsible for the injuries thus incurred.

Plaintiff contends, upon the authority of the Turntable and Torpedo cases, that because
of plaintiff's youth the intervention of his action between the negligent act of the
defendant in leaving the caps exposed on its premises and the explosion which resulted
in his injury should not be held to have contributed in any wise to the accident; and it is
because we can not agree with this proposition, although we accept the doctrine of the
Turntable and Torpedo cases, that we have thought proper to discuss and to consider
that doctrine at length in this decision. As was said in case of Railroad Co. vs.
Stout (supra), "While it is the general rule in regard to an adult that to entitle him to
recover damages for an injury resulting from the fault or negligence of another he must
himself have been free from fault, such is not the rule in regard to an infant of tender
years. The care and caution required of a child is according to his maturity and capacity
only, and this is to be determined in each case by the circumstances of the case." As
we think we have shown, under the reasoning on which rests the doctrine of the
Turntable and Torpedo cases, no fault which would relieve defendant of responsibility
for injuries resulting from its negligence can be attributed to the plaintiff, a well-grown
boy of 15 years of age, because of his entry upon defendant's uninclosed premises
without express permission or invitation' but it is wholly different question whether such
youth can be said to have been free from fault when he willfully and deliberately cut
open the detonating cap, and placed a match to the contents, knowing, as he
undoubtedly did, that his action would result in an explosion. On this point, which must
be determined by "the particular circumstances of this case," the doctrine laid down in
the Turntable and Torpedo cases lends us no direct aid, although it is worthy of
observation that in all of the "Torpedo" and analogous cases which our attention has
been directed, the record discloses that the plaintiffs, in whose favor judgments have
been affirmed, were of such tender years that they were held not to have the capacity to
understand the nature or character of the explosive instruments which fell into their
hands.

In the case at bar, plaintiff at the time of the accident was a well-grown youth of 15,
more mature both mentally and physically than the average boy of his age; he had been
to sea as a cabin boy; was able to earn P2.50 a day as a mechanical draftsman thirty
days after the injury was incurred; and the record discloses throughout that he was
exceptionally well qualified to take care of himself. The evidence of record leaves no
room for doubt that, despite his denials on the witness stand, he well knew the
explosive character of the cap with which he was amusing himself. The series of
experiments made by him in his attempt to produce an explosion, as described by the
little girl who was present, admit of no other explanation. His attempt to discharge the
cap by the use of electricity, followed by his efforts to explode it with a stone or a
hammer, and the final success of his endeavors brought about by the application of a
match to the contents of the caps, show clearly that he knew what he was about. Nor
can there be any reasonable doubt that he had reason to anticipate that the explosion
might be dangerous, in view of the fact that the little girl, 9 years of age, who was within
him at the time when he put the match to the contents of the cap, became frightened
and ran away.

True, he may not have known and probably did not know the precise nature of the
explosion which might be expected from the ignition of the contents of the cap, and of
course he did not anticipate the resultant injuries which he incurred; but he well knew
that a more or less dangerous explosion might be expected from his act, and yet he
willfully, recklessly, and knowingly produced the explosion. It would be going far to say
that "according to his maturity and capacity" he exercised such and "care and caution"
as might reasonably be required of him, or that defendant or anyone else should be
held civilly responsible for injuries incurred by him under such circumstances.

The law fixes no arbitrary age at which a minor can be said to have the necessary
capacity to understand and appreciate the nature and consequences of his own acts, so
as to make it negligence on his part to fail to exercise due care and precaution in the
commission of such acts; and indeed it would be impracticable and perhaps impossible
so to do, for in the very nature of things the question of negligence necessarily depends
on the ability of the minor to understand the character of his own acts and their
consequences; and the age at which a minor can be said to have such ability will
necessarily depends of his own acts and their consequences; and at the age at which a
minor can be said to have such ability will necessarily vary in accordance with the
varying nature of the infinite variety of acts which may be done by him. But some idea of
the presumed capacity of infants under the laws in force in these Islands may be
gathered from an examination of the varying ages fixed by our laws at which minors are
conclusively presumed to be capable of exercising certain rights and incurring certain
responsibilities, though it can not be said that these provisions of law are of much
practical assistance in cases such as that at bar, except so far as they illustrate the rule
that the capacity of a minor to become responsible for his own acts varies with the
varying circumstances of each case. Under the provisions of the Penal Code a minor
over fifteen years of age is presumed to be capable of committing a crime and is to held
criminally responsible therefore, although the fact that he is less than eighteen years of
age will be taken into consideration as an extenuating circumstance (Penal Code, arts.
8 and 9). At 10 years of age a child may, under certain circumstances, choose which
parent it prefers to live with (Code of Civil Procedure, sec. 771). At 14 may petition for
the appointment of a guardian (Id., sec. 551), and may consent or refuse to be adopted
(Id., sec. 765). And males of 14 and females of 12 are capable of contracting a legal
marriage (Civil Code, art. 83; G. O., No. 68, sec. 1).
We are satisfied that the plaintiff in this case had sufficient capacity and understanding
to be sensible of the danger to which he exposed himself when he put the match to the
contents of the cap; that he was sui juris in the sense that his age and his experience
qualified him to understand and appreciate the necessity for the exercise of that degree
of caution which would have avoided the injury which resulted from his own deliberate
act; and that the injury incurred by him must be held to have been the direct and
immediate result of his own willful and reckless act, so that while it may be true that
these injuries would not have been incurred but for the negligence act of the defendant
in leaving the caps exposed on its premises, nevertheless plaintiff's own act was the
proximate and principal cause of the accident which inflicted the injury.

The rule of the Roman law was: Quod quis ex culpa sua damnum sentit, non intelligitur
sentire. (Digest, book 50, tit. 17 rule 203.)

The Patidas contain the following provisions:

The just thing is that a man should suffer the damage which comes to him
through his own fault, and that he can not demand reparation therefor from
another. (Law 25, tit. 5, Partida 3.)

And they even said that when a man received an injury through his own acts the
grievance should be against himself and not against another. (Law 2, tit.
7, Partida 2.)

According to ancient sages, when a man received an injury through his own acts
the grievance should be against himself and not against another. (Law 2, tit.
7 Partida 2.)

And while there does not appear to be anything in the Civil Code which expressly lays
down the law touching contributory negligence in this jurisdiction, nevertheless, the
interpretation placed upon its provisions by the supreme court of Spain, and by this
court in the case of Rakes vs. Atlantic, Gulf and Pacific Co. (7 Phil. Rep., 359), clearly
deny to the plaintiff in the case at bar the right to recover damages from the defendant,
in whole or in part, for the injuries sustained by him.

The judgment of the supreme court of Spain of the 7th of March, 1902
(93 Jurisprudencia Civil, 391), is directly in point. In that case the court said:

According to the doctrine expressed in article 1902 of the Civil Code, fault or
negligence is a source of obligation when between such negligence and the
injury there exists the relation of cause and effect; but if the injury produced
should not be the result of acts or omissions of a third party, the latter has no
obligation to repair the same, although such acts or omission were imprudent or
unlawful, and much less when it is shown that the immediate cause of the injury
was the negligence of the injured party himself.
The same court, in its decision of June 12, 1900, said that "the existence of the alleged
fault or negligence is not sufficient without proof that it, and no other cause, gave rise to
the damage."

See also judgment of October 21, 1903.

To similar effect Scaevola, the learned Spanish writer, writing under that title in
his Jurisprudencia del Codigo Civil (1902 Anuario, p. 455), commenting on the
decision of March 7, 1902 of the Civil Code, fault or negligence gives rise to an
obligation when between it and the damage there exists the relation of cause and
effect; but if the damage caused does not arise from the acts or omissions of a
third person, there is no obligation to make good upon the latter, even though
such acts or omissions be imprudent or illegal, and much less so when it is
shown that the immediate cause of the damage has been the recklessness of the
injured party himself.

And again —

In accordance with the fundamental principle of proof, that the burden thereof is
upon the plaintiff, it is apparent that it is duty of him who shall claim damages to
establish their existence. The decisions of April 9, 1896, and March 18, July, and
September 27, 1898, have especially supported the principle, the first setting
forth in detail the necessary points of the proof, which are two: An act or
omission on the part of the person who is to be charged with the liability, and the
production of the damage by said act or omission.

This includes, by inference, the establishment of a relation of cause or effect

between the act or omission and the damage; the latter must be the direct result
of one of the first two. As the decision of March 22, 1881, said, it is necessary
that the damages result immediately and directly from an act performed culpably
and wrongfully; "necessarily presupposing a legal ground for imputability."
(Decision of October 29, 1887.)

Negligence is not presumed, but must be proven by him who alleges it.
(Scavoela, Jurisprudencia del Codigo Civil, vol. 6, pp. 551-552.)

(Cf. decisions of supreme court of Spain of June 12, 1900, and June 23, 1900.)

Finally we think the doctrine in this jurisdiction applicable to the case at bar was
definitely settled in this court in the maturely considered case of Rakes vs. Atlantic, Gulf
and Pacific Co. (supra), wherein we held that while "There are many cases (personal
injury cases) was exonerated," on the ground that "the negligence of the plaintiff was
the immediate cause of the casualty" (decisions of the 15th of January, the 19th of
February, and the 7th of March, 1902, stated in Alcubilla's Index of that year); none of
the cases decided by the supreme court of Spain "define the effect to be given the
negligence of its causes, though not the principal one, and we are left to seek the theory
of the civil law in the practice of other countries;" and in such cases we declared that
law in this jurisdiction to require the application of "the principle of proportional
damages," but expressly and definitely denied the right of recovery when the acts of the
injured party were the immediate causes of the accident.

The doctrine as laid down in that case is as follows:

Difficulty seems to be apprehended in deciding which acts of the injured party

shall be considered immediate causes of the accident. The test is simple.
Distinction must be made between the accident and the injury, between the event
itself, without which there could have been no accident, and those acts of the
victim not entering into it, independent of it, but contributing to his own proper
hurt. For instance, the cause of the accident under review was the displacement
of the crosspiece or the failure to replace it. This produces the event giving
occasion for damages—that is, the sinking of the track and the sliding of the iron
rails. To this event, the act of the plaintiff in walking by the side of the car did not
contribute, although it was an element of the damage which came to himself.
Had the crosspiece been out of place wholly or partly through his act or omission
of duty, that would have been one of the determining causes of the event or
accident, for which he would have been responsible. Where he contributes to the
principal occurrence, as one of its determining factors, he can not recover.
Where, in conjunction with the occurrence, he contributes only to his own injury,
he may recover the amount that the defendant responsible for the event should
pay for such injury, less a sum deemed a suitable equivalent for his own
imprudence.

We think it is quite clear that under the doctrine thus stated, the immediate cause of the
explosion, the accident which resulted in plaintiff's injury, was in his own act in putting a
match to the contents of the cap, and that having "contributed to the principal
occurrence, as one of its determining factors, he can not recover."

We have not deemed it necessary to examine the effect of plaintiff's action in picking up
upon defendant's premises the detonating caps, the property of defendant, and carrying
the relation of cause and effect between the negligent act or omission of the defendant
in leaving the caps exposed on its premises and the injuries inflicted upon the plaintiff
by the explosion of one of these caps. Under the doctrine of the Torpedo cases, such
action on the part of an infant of very tender years would have no effect in relieving
defendant of responsibility, but whether in view of the well-known fact admitted in
defendant's brief that "boys are snappers-up of unconsidered trifles," a youth of the age
and maturity of plaintiff should be deemed without fault in picking up the caps in
question under all the circumstances of this case, we neither discuss nor decide.

Twenty days after the date of this decision let judgment be entered reversing the
judgment of the court below, without costs to either party in this instance, and ten days
thereafter let the record be returned to the court wherein it originated, where the
judgment will be entered in favor of the defendant for the costs in first instance and the
complaint dismissed without day. So ordered.

Arellano, C.J., Torres and Moreland, JJ., concur.

Johnson, J., concurs in the result.

FIRST DIVISION

[G.R. No. 129792. December 21, 1999]

JARCO MARKETING CORPORATION, LEONARDO KONG,

JOSE TIOPE and ELISA PANELO, petitioners,
vs. HONORABLE COURT OF APPEALS, CONRADO C.
AGUILAR and CRISELDA R. AGUILAR, respondents.

DECISION
DAVIDE, JR., C.J.:

In this petition for review on certiorari under Rule 45 of the Rules of

Court, petitioners seek the reversal of the 17 June 1996 decision[1] of the
Court of Appeals in C.A. G.R. No. CV 37937 and the resolution[2]denying
their motion for reconsideration. The assailed decision set aside the 15
January 1992 judgment of the Regional Trial Court (RTC), Makati City,
Branch 60 in Civil Case No. 7119 and ordered petitioners to pay
damages and attorneys fees to private respondents Conrado and
Criselda (CRISELDA) Aguilar.
Petitioner Jarco Marketing Corporation is the owner of Syvels
Department Store, Makati City. Petitioners Leonardo Kong, Jose Tiope
and Elisa Panelo are the stores branch manager, operations manager,
and supervisor, respectively. Private respondents are spouses and the
parents of Zhieneth Aguilar (ZHIENETH).
In the afternoon of 9 May 1983, CRISELDA and ZHIENETH were at
the 2nd floor of Syvels Department Store, Makati City. CRISELDA was
signing her credit card slip at the payment and verification counter when
she felt a sudden gust of wind and heard a loud thud. She looked
behind her. She then beheld her daughter ZHIENETH on the floor, her
young body pinned by the bulk of the stores gift-wrapping
counter/structure. ZHIENETH was crying and screaming for
help. Although shocked, CRISELDA was quick to ask the assistance of
the people around in lifting the counter and retrieving ZHIENETH from
the floor.[3]
ZHIENETH was quickly rushed to the Makati Medical Center where
she was operated on. The next day ZHIENETH lost her speech and
thereafter communicated with CRISELDA by writing on a magic
slate. The injuries she sustained took their toil on her young body. She
died fourteen (14) days after the accident or on 22 May 1983, on the
hospital bed. She was six years old.[4]
The cause of her death was attributed to the injuries she
sustained. The provisional medical certificate[5] issued by ZHIENETHs
attending doctor described the extent of her injuries:

Diagnoses:

1. Shock, severe, sec. to intra-abdominal injuries due to blunt injury

2. Hemorrhage, massive, intraperitoneal sec. to laceration, (L) lobe liver

3. Rupture, stomach, anterior & posterior walls

4. Complete transection, 4th position, duodenum

5. Hematoma, extensive, retroperitoneal

6. Contusion, lungs, severe

CRITICAL

After the burial of their daughter, private respondents demanded

upon petitioners the reimbursement of the hospitalization, medical bills
and wake and funeral expenses[6] which they had incurred. Petitioners
refused to pay. Consequently, private respondents filed a complaint for
damages, docketed as Civil Case No. 7119 wherein they sought the
payment of P157,522.86 for actual damages, P300,000 for moral
damages, P20,000 for attorneys fees and an unspecified amount for
loss of income and exemplary damages.
 In their answer with counterclaim, petitioners denied any liability for
the injuries and consequent death of ZHIENETH. They claimed that
CRISELDA was negligent in exercising care and diligence over her
daughter by allowing her to freely roam around in a store filled with
glassware and appliances. ZHIENETH too, was guilty of contributory
negligence since she climbed the counter, triggering its eventual
collapse on her. Petitioners also emphasized that the counter was made
of sturdy wood with a strong support; it never fell nor collapsed for the
past fifteen years since its construction.
Additionally, petitioner Jarco Marketing Corporation maintained that
it observed the diligence of a good father of a family in the selection,
supervision and control of its employees. The other petitioners likewise
raised due care and diligence in the performance of their duties and
countered that the complaint was malicious for which they suffered
besmirched reputation and mental anguish. They sought the dismissal
of the complaint and an award of moral and exemplary damages and
attorneys fees in their favor.
In its decision[7] the trial court dismissed the complaint and
counterclaim after finding that the preponderance of the evidence
favored petitioners. It ruled that the proximate cause of the fall of the
counter on ZHIENETH was her act of clinging to it. It believed
petitioners witnesses who testified that ZHIENETH clung to the counter,
afterwhich the structure and the girl fell with the structure falling on top
of her, pinning her stomach. In contrast, none of private respondents
witnesses testified on how the counter fell. The trial court also held that
CRISELDAs negligence contributed to ZHIENETHs accident.
In absolving petitioners from any liability, the trial court reasoned that
the counter was situated at the end or corner of the 2nd floor as a
precautionary measure hence, it could not be considered as an
attractive nuisance.[8] The counter was higher than ZHIENETH. It has
been in existence for fifteen years. Its structure was safe and well-
balanced. ZHIENETH, therefore, had no business climbing on and
clinging to it.
Private respondents appealed the decision, attributing as errors of
the trial court its findings that: (1) the proximate cause of the fall of the
counter was ZHIENETHs misbehavior; (2) CRISELDA was negligent in
her care of ZHIENETH; (3) petitioners were not negligent in the
maintenance of the counter; and (4) petitioners were not liable for the
death of ZHIENETH.
Further, private respondents asserted that ZHIENETH should be
entitled to the conclusive presumption that a child below nine (9) years
is incapable of contributory negligence. And even if ZHIENETH, at six
(6) years old, was already capable of contributory negligence, still it was
physically impossible for her to have propped herself on the
counter. She had a small frame (four feet high and seventy pounds) and
the counter was much higher and heavier than she was. Also, the
testimony of one of the stores former employees, Gerardo Gonzales,
who accompanied ZHIENETH when she was brought to the emergency
room of the Makati Medical Center belied petitioners theory that
ZHIENETH climbed the counter. Gonzales claimed that when
ZHIENETH was asked by the doctor what she did, ZHIENETH replied,
[N]othing, I did not come near the counter and the counter just fell on
me.[9] Accordingly, Gonzales testimony on ZHIENETHs spontaneous
declaration should not only be considered as part of res gestae but also
accorded credit.
Moreover, negligence could not be imputed to CRISELDA for it was
reasonable for her to have let go of ZHIENETH at the precise moment
that she was signing the credit card slip.
Finally, private respondents vigorously maintained that the
proximate cause of ZHIENETHs death, was petitioners negligence in
failing to institute measures to have the counter permanently nailed.
On the other hand, petitioners argued that private respondents
raised purely factual issues which could no longer be disturbed. They
explained that ZHIENETHs death while unfortunate and tragic, was an
accident for which neither CRISELDA nor even ZHIENETH could
entirely be held faultless and blameless. Further, petitioners adverted to
the trial courts rejection of Gonzales testimony as unworthy of
credence.
As to private respondents claim that the counter should have been
nailed to the ground, petitioners justified that it was not necessary. The
counter had been in existence for several years without any prior
accident and was deliberately placed at a corner to avoid such
accidents. Truth to tell, they acted without fault or negligence for they
had exercised due diligence on the matter. In fact, the criminal
case[10] for homicide through simple negligence filed by private
respondents against the individual petitioners was dismissed; a verdict
of acquittal was rendered in their favor.
The Court of Appeals, however, decided in favor of private
respondents and reversed the appealed judgment. It found that
petitioners were negligent in maintaining a structurally dangerous
counter. The counter was shaped like an inverted L[11] with a top wider
than the base. It was top heavy and the weight of the upper portion was
neither evenly distributed nor supported by its narrow base. Thus, the
counter was defective, unstable and dangerous; a downward pressure
on the overhanging portion or a push from the front could cause the
counter to fall. Two former employees of petitioners had already
previously brought to the attention of the management the danger the
counter could cause. But the latter ignored their concern. The Court of
Appeals faulted the petitioners for this omission, and concluded that the
incident that befell ZHIENETH could have been avoided had petitioners
repaired the defective counter. It was inconsequential that the counter
had been in use for some time without a prior incident.
The Court of Appeals declared that ZHIENETH, who was below
seven (7) years old at the time of the incident, was absolutely incapable
of negligence or other tort. It reasoned that since a child under nine (9)
years could not be held liable even for an intentional wrong, then the
six-year old ZHIENETH could not be made to account for a mere
mischief or reckless act. It also absolved CRISELDA of any negligence,
finding nothing wrong or out of the ordinary in momentarily allowing
ZHIENETH to walk while she signed the document at the nearby
counter.
The Court of Appeals also rejected the testimonies of the witnesses
of petitioners. It found them biased and prejudiced. It instead gave
credit to the testimony of disinterested witness Gonzales. The Court of
Appeals then awarded P99,420.86 as actual damages, the amount
representing the hospitalization expenses incurred by private
respondents as evidenced by the hospital's statement of account.[12] It
denied an award for funeral expenses for lack of proof to substantiate
the same. Instead, a compensatory damage of P50,000 was awarded
for the death of ZHIENETH.
We quote the dispositive portion of the assailed decision,[13] thus:
WHEREFORE, premises considered, the judgment of the lower court is
SET ASIDE and another one is entered against [petitioners], ordering
them to pay jointly and severally unto [private respondents] the
following:

1. P50,000.00 by way of compensatory damages for the death of

Zhieneth Aguilar, with legal interest (6% p.a.) from 27 April 1984;
2. P99,420.86 as reimbursement for hospitalization expenses
incurred; with legal interest (6% p.a.) from 27 April 1984;
3. P100,000.00 as moral and exemplary damages;
4. P20,000.00 in the concept of attorneys fees; and
5. Costs.
Private respondents sought a reconsideration of the decision but the
same was denied in the Court of Appeals resolution[14] of 16 July 1997.
Petitioners now seek the reversal of the Court of Appeals decision
and the reinstatement of the judgment of the trial court. Petitioners
primarily argue that the Court of Appeals erred in disregarding the
factual findings and conclusions of the trial court. They stress that since
the action was based on tort, any finding of negligence on the part of
the private respondents would necessarily negate their claim for
damages, where said negligence was the proximate cause of the injury
sustained. The injury in the instant case was the death of
ZHIENETH. The proximate cause was ZHIENETHs act of clinging to the
counter. This act in turn caused the counter to fall on her. This and
CRISELDAs contributory negligence, through her failure to provide the
proper care and attention to her child while inside the store, nullified
private respondents claim for damages. It is also for these reasons that
parents are made accountable for the damage or injury inflicted on
others by their minor children. Under these circumstances, petitioners
could not be held responsible for the accident that befell ZHIENETH.
Petitioners also assail the credibility of Gonzales who was already
separated from Syvels at the time he testified; hence, his testimony
might have been tarnished by ill-feelings against them.
For their part, private respondents principally reiterated their
arguments that neither ZHIENETH nor CRISELDA was negligent at any
time while inside the store; the findings and conclusions of the Court of
Appeals are substantiated by the evidence on record; the testimony of
Gonzales, who heard ZHIENETH comment on the incident while she
was in the hospitals emergency room should receive credence; and
finally, ZHIENETHs part of the res gestae declaration that she did
nothing to cause the heavy structure to fall on her should be considered
as the correct version of the gruesome events.
We deny the petition.
The two issues to be resolved are: (1) whether the death of
ZHIENETH was accidental or attributable to negligence; and (2) in case
of a finding of negligence, whether the same was attributable to private
respondents for maintaining a defective counter or to CRISELDA and
ZHIENETH for failing to exercise due and reasonable care while inside
the store premises.
An accident pertains to an unforeseen event in which no fault or
negligence attaches to the defendant.[15] It is a fortuitous circumstance,
event or happening; an event happening without any human agency, or
if happening wholly or partly through human agency, an event which
under the circumstances is unusual or unexpected by the person to
whom it happens.[16]
On the other hand, negligence is the omission to do something
which a reasonable man, guided by those considerations which
ordinarily regulate the conduct of human affairs, would do, or the doing
of something which a prudent and reasonable man would not
do.[17] Negligence is the failure to observe, for the protection of the
interest of another person, that degree of care, precaution and vigilance
which the circumstances justly demand, whereby such other person
suffers injury.[18]
Accident and negligence are intrinsically contradictory; one cannot
exist with the other. Accident occurs when the person concerned is
exercising ordinary care, which is not caused by fault of any person and
which could not have been prevented by any means suggested by
common prudence.[19]
The test in determining the existence of negligence is enunciated in
the landmark case of Picart v. Smith,[20] thus: Did the defendant in doing
the alleged negligent act use that reasonable care and caution which an
ordinarily prudent person would have used in the same situation? If not,
then he is guilty of negligence.[21]
 We rule that the tragedy which befell ZHIENETH was no accident
and that ZHIENETHs death could only be attributed to negligence.
We quote the testimony of Gerardo Gonzales who was at the scene
of the incident and accompanied CRISELDA and ZHIENETH to the
hospital:
Q While at the Makati Medical Center, did you hear or notice anything while the
child was being treated?
A At the emergency room we were all surrounding the child. And when the doctor
asked the child what did you do, the child said nothing, I did not come near
the counter and the counter just fell on me.
Q (COURT TO ATTY. BELTRAN)
You want the words in Tagalog to be translated?
ATTY. BELTRAN
Yes, your Honor.
COURT
Granted. Intercalate wala po, hindi po ako lumapit doon. Basta
bumagsak.[22]
This testimony of Gonzales pertaining to ZHIENETHs statement
formed (and should be admitted as) part of the res gestae under
Section 42, Rule 130 of the Rules of Court, thus:

Part of res gestae. Statements made by a person while a startling

occurrence is taking place or immediately prior or subsequent thereto
with respect to the circumstances thereof, may be given in evidence as
part of the res gestae. So, also, statements accompanying an equivocal
act material to the issue, and giving it a legal significance, may be
received as part of the res gestae.

It is axiomatic that matters relating to declarations of pain or

suffering and statements made to a physician are generally considered
declarations and admissions.[23] All that is required for their admissibility
as part of the res gestae is that they be made or uttered under the
influence of a startling event before the declarant had the time to think
and concoct a falsehood as witnessed by the person who testified in
court. Under the circumstances thus described, it is unthinkable for
ZHIENETH, a child of such tender age and in extreme pain, to have lied
to a doctor whom she trusted with her life. We therefore accord
credence to Gonzales testimony on the matter, i.e., ZHIENETH
performed no act that facilitated her tragic death. Sadly, petitioners did,
through their negligence or omission to secure or make stable the
counters base.
Gonzales earlier testimony on petitioners insistence to keep and
maintain the structurally unstable gift-wrapping counter proved their
negligence, thus:

Q When you assumed the position as gift wrapper at the second floor,
will you please describe the gift wrapping counter, were you able to
examine?

A Because every morning before I start working I used to clean that

counter and since it is not nailed and it was only standing on the floor, it
was shaky.

xxx
Q Will you please describe the counter at 5:00 oclock [sic] in the afternoon on
[sic] May 9 1983?
A At that hour on May 9, 1983, that counter was standing beside the verification
counter. And since the top of it was heavy and considering that it was not
nailed, it can collapse at anytime, since the top is heavy.
xxx
Q And what did you do?
A I informed Mr. Maat about that counter which is [sic] shaky and
since Mr. Maat is fond of putting display decorations on tables, he
even told me that I would put some decorations. But since I told
him that it not [sic] nailed and it is shaky he told me better inform
also the company about it. And since the company did not do
anything about the counter, so I also did not do anything about the
counter.[24] [Emphasis supplied]
Ramon Guevarra, another former employee, corroborated the
testimony of Gonzales, thus:
Q Will you please described [sic] to the honorable Court the counter where you
were assigned in January 1983?
xxx
 A That counter assigned to me was when my supervisor ordered me to carry that
counter to another place. I told him that the counter needs nailing and it has
to be nailed because it might cause injury or accident to another since it was
shaky.
Q When that gift wrapping counter was transferred at the second floor on
February 12, 1983, will you please describe that to the honorable Court?
A I told her that the counter wrapper [sic] is really in good [sic] condition; it was
shaky. I told her that we had to nail it.
Q When you said she, to whom are you referring to [sic]?
A I am referring to Ms. Panelo, sir.
Q And what was the answer of Ms. Panelo when you told her that the counter
was shaky?
A She told me Why do you have to teach me. You are only my subordinate and
you are to teach me? And she even got angry at me when I told her that.
xxx
Q From February 12, 1983 up to May 9, 1983, what if any, did Ms. Panelo or any
employee of the management do to that (sic)
xxx
Witness:
None, sir. They never nailed the counter. They only nailed the counter
after the accident happened.[25] [Emphasis supplied]
Without doubt, petitioner Panelo and another store supervisor were
personally informed of the danger posed by the unstable counter. Yet,
neither initiated any concrete action to remedy the situation nor ensure
the safety of the stores employees and patrons as a reasonable and
ordinary prudent man would have done. Thus, as confronted by the
situation petitioners miserably failed to discharge the due diligence
required of a good father of a family.
On the issue of the credibility of Gonzales and Guevarra, petitioners
failed to establish that the formers testimonies were biased and tainted
with partiality. Therefore, the allegation that Gonzales and Guevarras
testimonies were blemished by ill feelings against petitioners since they
(Gonzales and Guevarra) were already separated from the company at
the time their testimonies were offered in court was but mere
speculation and deserved scant consideration.
 It is settled that when the issue concerns the credibility of witnesses,
the appellate courts will not as a general rule disturb the findings of the
trial court, which is in a better position to determine the same. The trial
court has the distinct advantage of actually hearing the testimony of and
observing the deportment of the witnesses.[26] However, the rule admits
of exceptions such as when its evaluation was reached arbitrarily or it
overlooked or failed to appreciate some facts or circumstances of
weight and substance which could affect the result of the case.[27] In the
instant case, petitioners failed to bring their claim within the exception.
Anent the negligence imputed to ZHIENETH, we apply the
conclusive presumption that favors children below nine (9) years old in
that they are incapable of contributory negligence. In his book,[28] former
Judge Cezar S. Sangco stated:

In our jurisdiction, a person under nine years of age is conclusively

presumed to have acted without discernment, and is, on that account,
exempt from criminal liability. The same presumption and a like
exemption from criminal liability obtains in a case of a person over nine
and under fifteen years of age, unless it is shown that he has acted with
discernment. Since negligence may be a felony and a quasi-delict and
required discernment as a condition of liability, either criminal or civil, a
child under nine years of age is, by analogy, conclusively presumed to
be incapable of negligence; and that the presumption of lack of
discernment or incapacity for negligence in the case of a child over nine
but under fifteen years of age is a rebuttable one, under our law. The
rule, therefore, is that a child under nine years of age must be
conclusively presumed incapable of contributory negligence as a matter
of law. [Emphasis supplied]

Even if we attribute contributory negligence to ZHIENETH and

assume that she climbed over the counter, no injury should have
occurred if we accept petitioners theory that the counter was stable and
sturdy. For if that was the truth, a frail six-year old could not have
caused the counter to collapse. The physical analysis of the counter by
both the trial court and Court of Appeals and a scrutiny of the
evidence[29]on record reveal otherwise, i.e., it was not durable after
all. Shaped like an inverted L, the counter was heavy, huge, and its top
laden with formica. It protruded towards the customer waiting area and
its base was not secured.[30]
 CRISELDA too, should be absolved from any contributory
negligence. Initially, ZHIENETH held on to CRISELDAs waist, later to
the latters hand.[31] CRISELDA momentarily released the childs hand
from her clutch when she signed her credit card slip. At this precise
moment, it was reasonable and usual for CRISELDA to let go of her
child. Further, at the time ZHIENETH was pinned down by the counter,
she was just a foot away from her mother; and the gift-wrapping counter
was just four meters away from CRISELDA.[32] The time and distance
were both significant. ZHIENETH was near her mother and did not loiter
as petitioners would want to impress upon us. She even admitted to the
doctor who treated her at the hospital that she did not do anything; the
counter just fell on her.
WHEREFORE, in view of all the foregoing, the instant petition is
DENIED and the challenged decision of the Court of Appeals of 17 June
1996 in C.A. G.R. No. CV 37937 is hereby AFFIRMED.
Costs against petitioners.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. L-12858 January 22, 1918

THE UNITED STATES, plaintiff-appellee,

vs.
SANTIAGO PINEDA, defendant-appellant.

Francisco and Lualhati for appellant.

Acting Attorney-General Paredes for appellee.

MALCOLM, J.:

This appeal requires a construction and an application, for the first time, of the penal
provisions of the Pharmacy Law.

Santiago Pineda, the defendant, is a registered pharmacist of long standing and the
owner of a drug store located at Nos. 442, 444, Calle Santo Cristo, city of Manila. One
Feliciano Santos, having some sick horses, presented a copy of a prescription obtained
from Dr. Richardson, and which on other occasions Santos had given to his horses with
good results, at Pineda's drug store for filling. The prescription read — "clorato de
potasa — 120 gramos — en seis papelitos de 20 gramos, para caballo." Under the
supervision of Pineda, the prescription was prepared and returned to Santos in the form
of six papers marked, "Botica Pineda — Clorato potasa — 120.00 — en seis papeles —
para caballo — Sto. Cristo 442, 444, Binondo, Manila." Santos, under the belief that he
had purchased the potassium chlorate which he had asked for, put two of the packages
in water the doses to two of his sick horses. Another package was mixed with water for
another horse, but was not used. The two horses, to which had been given the
preparation, died shortly afterwards. Santos, thereupon, took the three remaining
packages to the Bureau of Science for examination. Drs. Peña and Darjuan, of the
Bureau of Science, on analysis found that the packages contained not potassium
chlorate but barium chlorate. At the instance of Santos, the two chemists also went to
the drug store of the defendant and bought potassium chlorate, which when analyzed
was found to be barium chlorate. (Barium chlorate, it should be noted, is a poison;
potassium chlorate is not.) Dr. Buencamino, a veterinarian, performed an autopsy on
the horses, and found that death was the result of poisoning.

Four assignments of error are made. The first is that the lower court erred in admitting
the testimony of the chemist Pena and Darjuan as to their purchase of potassium
chlorate at the drug store of the accused, which substance proved on analysis to be
barium chlorate. What the appellant is here relying on is the maxim res inter alios acta.
As a general rule, the evidence of other offenses committed by a defendant is
inadmissible. But appellant has confused this maxim and this rule with certain
exceptions thereto. The effort is not to convict the accused of a second offense. Nor is
there an attempt to draw the mind away from the point at issue and thus to prejudice
defendant's case. The purpose is to ascertain defendant's knowledge and intent, and to
fix his negligence. If the defendant has on more than one occasion performed similar
acts, accident in good faith is possibly excluded, negligence is intensified, and
fraudulent intent may even be established. It has been said that there is no better
evidence of negligence than the frequency of accidents. (See 10 R. C. L., pp. 938, 940.)
The United States Supreme Court has held that:

On the trial of a criminal case the question relates to the tendency of certain
testimony to throw light upon a particular fact, or to explain the conduct of a
particular person, there is a certain discretion on the part of the trial judge which
a court of errors will not interfere with, unless it manifestly appear that the
testimony has no legitimate bearing upon the question at issue, and is calculated
to prejudice the accused.

Whenever the necessity arises for a resort to circumstantial evidence, either from
the nature of the inquiry or the failure of direct proof, objections to the testimony
on the ground of irrelevancy are not favored.

Evidence is admissible in a criminal action which tends to show motive, although

it tends to prove the commission of another offense by the defendant. (Moore vs.
U. S. [1893], 150 U. S., 57.)
The second assignment of error is that the lower court erred in finding that the
substance sold by the accused to Feliciano Santos on the 22d of June, 1916, was
barium chlorate and not potassium chlorate. The proof demonstrates the contrary.

The third and fourth assignments of error that the lower court erred in finding that the
accused has been proved guilty beyond a reasonable doubt of an infraction of Act No.
597, section 17, as amended. The third assignment contains the points we should
consider, including, we may remark, a somewhat difficult question concerning which the
briefs have given little assistance.

The Pharmacy Law was first enacted as Act No. 597, was later amended by Act Nos.
1921, 2236, and 2382, and is now found as Chapter 30 of the Administrative Code. The
law provides for a board of pharmaceutical examiners, and the examination and
registration of pharmacists, and finally contains sundry provisions relative to the practice
of pharmacy. High qualification for applicants for the pharmaceutical; examination are
established. The program of subjects for the examination is wide. Responsibility for the
quality of drugs is fixed by section 17 of the Pharmacy Law, as amended (now
Administrative Code [1917], section 751), in the following term:

Every pharmacist shall be responsible for the quality of all drugs, chemicals,
medicines, and poisons he may sell or keep for sale; and it shall be unlawful for
any person whomsoever to manufacture, prepare, sell, or administer any
prescription, drug, chemical, medicine, or poison under any fraudulent name,
direction, or pretense, or to adulterate any drug, chemical, medicine, or poison so
used, sold or offered for sale. Any drug, chemical, medicine, or poison shall be
held to be adulterated or deteriorated within the meaning of this section if it
differs from the standard of quality or purity given in the United States
Pharmacopoeia.

The same section of the Pharmacy Law also contains the following penal provision:
"Any person violating the provisions of this Act shall, upon conviction, be punished by a
fine of not more than five hundred dollar." The Administrative Code, section 2676,
changes the penalty somewhat by providing that:

Any person engaging in the practice of pharmacy in the Philippine Islands

contrary to any provision of the Pharmacy Law or violating any provisions of said
law for which no specific penalty s provided shall, for each offense, be punished
by a fine not to exceed two hundred pesos, or by imprisonment for not more than
ninety days, or both, in the discretion of the court.

These are the provisions of law, pursuant to which prosecution has been initiated and
which it is now incumbent upon us to construe.

Turning to the law, certain points therein as bearing on our present facts must be
admitted. Thus, defendant is a pharmacist. As a pharmacist, he is made responsible for
the quality of all drugs and poisons which he sells. And finally it is provided that it shall
be unlawful for him to sell any drug or poison under any "fraudulent name." It is the one
word "fraudulent" which has given the court trouble. What did the Legislature intend to
convey by this restrictive adjective?

Were we to adhere to the technical definition of fraud, which the appellant vigorously
insists upon, it would be difficult, if not impossible, to convict any druggist of a violation
of the law. The prosecution would have to prove to a reasonable degree of certainty that
the druggist made a material representation; that it was false; that when he made it he
knew that it was false or made it recklessly without any knowledge of its truth and as
positive assertion; that he made it with the intention that it should be acted upon by the
purchaser; that the purchaser acted in reliance upon it, and that the purchased thereby
suffered injury. Such a construction with a literal following of well-known principles on
the subject of fraud would strip the law of at least much of its force. It would leave the
innocent purchaser of drugs, who must blindly trust in the good faith and vigilance of the
pharmacist, at the mercy of any unscrupulous vendor. We should not, therefore, without
good reason so devitalize the law.

The profession of pharmacy, it has been said again and again, is one demanding care
and skill. The responsibility of the druggist to use care has been variously qualified as
"ordinary care," "care of a special high degree," "the highest degree of care known to
practical men." Even under the first conservative expression, "ordinary care" with
reference to the business of a druggist, the Supreme Court of Connecticut has said
must be held to signify "the highest practicable degree of prudence, thoughtfulness, and
vigilance, and most exact and reliable safeguards consistent with the reasonable
conduct of the business, in order that human life may not be constantly be exposed to
the danger flowing from the substitution of deadly poisons for harmless medicine."
(Tombari vs. Connors [1912], 85 Conn., 235. See also Willson vs. Faxon, Williams and
Faxon [1913], 208 N. Y., 108; Knoefel vs. Atkins [1907], 81 N. E., 600.) The "skill"
required of a druggist is denominated as "high" or "ample." (Peters vs. Jackson [1902],
50 W. Va., 644; 57 L. R. A., 428.) In other words, the care required must be
commensurate with the danger involved, and the skill employed must correspond with
the superior knowledge of the business which the law demands.

Under one conception, and it should not be forgotten that the case we consider are civil
in nature, the question of negligence or ignorance is irrelevant. The druggist is
responsible as an absolute guarantor of what he sells. In a decision which stands alone,
the Supreme Court of Kentucky said:

As applicable to the owners of drug stores, or persons engaged in vending drugs

and medicines by retail, the legal maxim should be reversed. Instead of caveat
emptor, it should be caveat venditor. That is to say, let him be certain that he
does not sell to a purchaser or send to a patient one drug for another, as arsenic
for calomel, cantharides for or mixed with snakeroot and Peruvian bark, or even
one innocent drug, calculated to produce a certain effect, in place of another sent
for and designed to produce a different effect. If he does these things, he cannot
escape civil responsibility, upon the alleged pretext that it was an accidental or
 an innocent mistake; that he had been very careful and particular, and had used
extraordinary care and diligence in preparing or compounding the medicines as
required, etc. Such excuses will not avail him. (Fleet vs. Hollenkemp [1852], 56
Am. Dec., 563.)

Under the other conception, in which the proof of negligence is considered as material,
where a customer calls upon a druggist for a harmless remedy, delivery of a poisonous
drug by mistake by the druggist is prima facie negligence, placing the burden on him to
show that the mistake was under the circumstances consistent with the exercise of due
care. (See Knoefel vs. Atkins, supra,) The druggist cannot, for example in filling a
prescription calling for potassium chlorate give instead to the customer barium chlorate,
a poison, place this poison in a package labeled "potassium chlorate," and expect to
escape responsibility on plea of mistake. His mistake, under the most favorable aspect
for himself, was negligence. So in a case where a druggist filled an order for calomel
tablets with morphine and placed the morphine in a box labeled calomel, it was said:

It is not suggested, nor can we apprehend that it is in any wise probable, that the
act of furnishing the wrong drug in this case was willful. If it was furnished by the
clerk, it was undoubtedly a mistake and unintentional. However, it was a mistake
of the gravest kind, and of the most disastrous effect. We cannot say that one
holding himself out as competent to handle such drugs, and who does so, having
rightful access to them, and relied upon by those dealing with him to exercise
that high degree of caution and care called for by the peculiarly dangerous nature
of this business, can be heard to say that his mistakes by which he furnishes a
customer the most deadly of drugs for those comparatively harmless is not, in
and of itself, gross negligence, and that of an aggravated form. (Smith's Admrx.
vs. Middleton [1902], 56 L. R. A., 484.)

The rule of caveat emptor cannot apply to the purchase and sale of drugs. The vendor
and the vendee do not stand at arms length as in ordinary transactions. An imperative
duty is on the druggist to take precautions to prevent death or serious injury to anyone
who relies on his absolute honesty and peculiar leaning. The nature of drugs is such
that examination would not avail the purchaser anything. It would be idle mockery for
the customer to make an examination of a compound of which he can know nothing.
Consequently, it must be that the druggist warrants that he will deliver the drug called
for.

In civil cases, the druggist is made liable for any injury approximately resulting from his
negligence. If B negligently sells poison under the guise of a beneficial drug to A, he is
liable for the injury done to A. In a case, which has repeatedly been termed the leading
case on the subject and which has been followed by the United States Supreme Court,
it was said, "Pharmacists or apothecaries who compound or sell medicines, if they
carelessly label a poison as a harmless medicine, and sent it so labeled into the market,
are liable to all persons who, without fault on their part, are injured by using it as such
medicine, in consequence of the false label; the rule being that the liability in such a
case arises not out of any contract or direct privity between the wrong-doer and the
person injured, but out of the duty which the law imposes on him to avoid acts in their
nature dangerous to the lives of others." (Nat. Savings Bank vs. Ward [1879], 100 U. S.,
195, following Thomas vs. Winchester [1852], 2 Seld. [N. Y.], 387.) In reality, for the
druggist, mistake is negligence and care is no defense. Throughout the criminal law, run
the same rigorous rules. For example, apothecaries or apothecary clerks, who are guilty
of negligence in the sale of medicine when death ensues in consequence, have been
held guilty of manslaughter. (See Tessymond's Case [1828], 1 Lewin, C. C., 169.)

Bearing these general principles in mind, and remembering particularly the care and
skill which are expected of druggist, that in some jurisdictions they are liable even for
their mistake and in others have the burden placed upon them to establish that they
were not negligent, it cannot be that the Philippine Legislature intended to use the word
"fraudulent" in all its strictness. A plea of accident and mistake cannot excuse for they
cannot take place unless there be wanton and criminal carelessness and neglect. How
the misfortune occurs is unimportant, if under all the circumstances the fact of
occurrence is attributed to the druggist as a legal fault. Rather considering the
responsibility for the quality of drugs which the law imposes on druggists and the
position of the word "fraudulent" in juxtaposition to "name," what is made unlawful is the
giving of a false name to the drug asked for. This view is borne out by Spanish
translation, which we are permitted to consult to explain the English text. In the Spanish
"supuesto" is used, and this word is certainly not synonymous with "fraudulent." The
usual badges of fraud, falsify, deception, and injury must be present-but not scienter.

In view of the tremendous an imminent danger to the public from the careless sale of
poisons and medicines, we do not deem it too rigid a rule to hold that the law penalizes
any druggist who shall sell one drug for another whether it be through negligence or
mistake.

The judgment of the lower court, sentencing the defendant to pay a fine of P100, with
subsidiary imprisonment in case of insolvency, and to pay the costs, is affirmed with the
cost of this instance against the appellant, without prejudice to any civil action which
may be instituted. So ordered.

Arellano, C.J., Torres, Johnson, Carson, Araullo, and Street, JJ., concur.