EVELYN TOLOSA VSNATIONAL LABOR RELATIONS COMMISSION, QWANA KAIUN (FUMIO NAKAGAWA), ASIA BULK TRANSPORT PHILS. INC., PEDRO GARATE and MARIO ASIS

G.R. No. 149578 April 10, 2003

Facts:

Captain Virgilio Tolosa ( husband of Evelyn Tolosa) was master of the vessel M/V Donna owned by Quana-Kaiun, and was hired through its manning agent, Asia Bulk Transport Phils., Inc. (Asia Bulk). During channeling activities upon the vessel’s departure from Yokohama on November 6, 1992, Capt. Tolosa was drenched with rainwater. Subsequently, he contracted fever on November 11 which was later on accompanied by loose bowel movement for the succeeding 12 days. His condition was reported to Asia Bulk and the US Coast Guard Headquarters in Hawaii on November 15. However, before he could be evacuated, he died on November 18, 1992.

Evelyn Tolosa, the widow, filed a complaint before the POEA for damages against Pedro Garate, Chief Mate of the vessel, Mario Asis, Second Mate, Asia Bulk and Quana-Kaiun. The case was transferred to the NLRC. The Labor Arbiter ruled in favor of the widow, awarding actual damages plus legal interest, as well as moral and exemplary damages and attorney’s fees. On appeal to the NLRC, the decision of the Labor Arbiter was vacated and the complaint was dismissed for lack of jurisdiction over the subject matter of the action pursuant to the provisions of the Labor Code, as amended. Sustaining the NLRC, the CA ruled that the labor commission had no jurisdiction over the subject matter of the action filed by petitioner. Her cause did not arise from an employer-employee relation, but from a quasi-delict or tort. Under Article 217 (a)(4) of the Labor Code which allows an award of damages incident to an employer-employee relation, the damages awarded were not proper as she is not an employee, but merely the wife of an employee.

Issues:

(1) Whether or not the Labor Arbiter and the NLRC had jurisdiction over petitioner’s action.

(2) Whether or not the monetary award granted by the Labor arbiter has already reached finality.

Held:

(1) The Court affirmed that the claim for damages was filed not for claiming damages under the Labor Code but under the Civil Code. The Court was convinced that the allegations were based on a quasi-delict or tort. Also, she had claimed for actual damages for loss of earning capacity based on a life expectancy of 65 years, which is cognizable under the Civil Code and can be recovered in an action based on a quasi-delict. Though damages under a quasi-delict may be recoverable under the jurisdiction of labor arbiters and the NLRC, the relief must be based on an action that has reasonable casual connection with the Labor Code, labor statutes or CBA’s. It must be noted that a worker’s loss of earning capacity and backlisting are not to be equated with wages, overtime compensation or separation pay, and other labor benefits that are generally cognized in labor disputes. The loss of earning capacity is a relief or claim resulting from a quasi-delict or a similar cause within the realm of Civil Law. In the present case, Evelyn Tolosa’s claim for damages is not related to any other claim under Article 217, other labor

statutes, or CBA’s. She cannot anchor her claim for damages to Article 161 of the Labor Code, which does not grant or specify a claim or relief. This provision is only a safety and health standard under Book IV of the same Code. The enforcement of this labor standard rests with the labor secretary. It is not the NLRC but the regular courts that have jurisdiction over action for damages, in which the employer-employee relation is merely incidental, and in which the cause of action proceeds from a different source of obligation such as a tort.

(2) On the finality of the award, the Court ruled that issues not raised in the court below cannot be raised for the first time on appeal. Thus, the issue being not brought to the attention of the Court of Appeals first, this cannot be considered by the Supreme Court. It would be tantamount to denial of the right to due process against the respondents to do so.

DELSAN TRANSPORTATION VS. C & A CONSTRUCTION, INC.

G.R. no. 156034 October 1, 2003

Facts:

C & A construction, construct a deflector wall at the Vitas reclamation Area in Tondo, Manila it was not formally turnover to National Housing Authority though it was completed in 1994. On 12:00 midnight of October 20, 1994 Captain Demetrio T. Jusep of M/V Delsan Express receive a report that that a typhoon was going to hit Manila after eight (8) hours. At 8:35 a.m. he tried to seek shelter but it was already congested. At 10:00 a.m. Capt. Jusep drop the anchor at the vicinity of Vitas mouth, the waves were already reaching 8 to 10 feet. The ship was dragged by the wind toward the Napocor power barge Capt. Jusep ordered a full stop of the vessel to avoid the collision but when the engine was re-started, it hit the deflector wall constructed by the respondent. P456,198.24 was the damaged cause by the incident. C & A construction demanded payment of the damages from Capt. Jusep but the latter refused to pay due to the cause of the incident was by a fortuitous event. The trial court ruled that Captain Jusep was not guilty of negligence in applying the “emergency rule” because it had taken necessary precautions to avoid accident. The Court of Appeals reversed & set aside the decision of the trial court. Captain Jusep was found guilty of negligence in transferring the vessel only at 8:35 a.m. of October 21,1994 and held liable for damages in waiting until 8:35 a.m. before transfering the vessel to sought shelter.

Issues:

(1) Whether or not Capt. Jusep was negligent.

(2) Whether or not the petitioner is solidarily liable under Art. 2180 of the Civil Code for Quasi-Delict.

Held:

(1) The court finds Captain Jusep is guilty of negligence, the failure to take immediate and appropriate action under the circumstances, despite the knowledge that there is typhoon but

he waited for the lapse of eight (8) hours instead. Captain Jusep showed an inexcusable lack of care and caution which an ordinary prudent person would have observed in the same situation. The trial court erred in applying the emergency rule because the danger where Captain Jusep found himself was caused by his own negligence.

(2) The court finds the petitioner liable for the negligent act of Capt. Jusep. Whenever an employee’s negligence causes damage to another, it instantly arise a presumption that the employer failed to exercise the care and diligence of supervision of his employee. In Fabre ,jr. v Court of Appeals held that due diligence requires consistent compliance of rules & regulation for the guidance and actual implementation of rules. But the petitioner fails to give any evidence that its rule are strictly implemented and monitored in compliance therewith petitioner is therefore liable for the negligent act of Capt. Jusep. The amount of P 456, 198.27 due earn 6% interest per annum from October 3, 1995 until the finality of the decision.

SPS. ANTONIO C. SANTOS and ESPERANZA C. SANTOS, NORA BARNALO, BELINDA LUMACTAD, MARIENELA DY, NIKKA SANTOS and LEONARDO FERRERVS. HON. NORMANDIE B. PIZARDO(Presiding Judge, RTC Quezon City) DIONISO M SIBAYAN and VIRON TRANSPORTATION COMPANY (rep. VIRGILIO Q. RONDARIS)

G.R. no. 151452 July 29, 2005

Facts:

Dionisio M. Sibayan was charged with reckless imprudence resulting to multiple homicide and multiple physical injuries due to the vehicle collision between Viron Transit bus driven by Sibayan and a Lite Van Ace. However the municipal circuit trial court was no pronouncement of civil liability. The petitioners filed a complaint for damages to the respondents pursuant to their reservation to file a separate civil action citing Sibayan’s judgment conviction. And it was moved to dismiss by the Viron Transit. The petitioners opposed and contends that the motion to dismiss that be ten (10) years from the judgment of criminal action is the prescription and therefore it is within the period since it was just barely two (2) years had elapse.

The complaint was dismissed by the trial court due to the ground that the cause of action had prescribed; based on quasi-delict that it prescribes four (4) years from the accrual of the cause of action. Again the petitioners filed a reconsideration that the complaint is not based on quasi- delict but on the final judgment of conviction in the criminal case which prescribes ten (10) years upon the finality of the judgment. The motion for reconsideration of the petitioners was denied by the trial court based on quasi-delict in Article 1146 of the Civil Code that the complaint was filed more than four (4) years after the vehicular activities therefore it prescribes already.

On the petition for certiorari the petitioners filed to the Court of Appeals it was dismissed the same error in the choice or mode of appeal. It also denies the petitioners’ motion for and the petitioners failed to allege that the petition was brought within the recognized exceptions for the allowance of certiorari in lieu of appeal. Petitioners insist that it should be enforced in the complaint that arose in ex delicto and not based on quasi-delict. Since the action is based on the criminal liability of private respondents, the cause of action accrued from the finality of the judgment of conviction. Private respondents insisted, pointing out the averments in the complaint make out a cause of action for quasi delict in Article 2176 and 2180 of the Civil Code. The prescriptive period of four (4) years should be reckoned from the time the

accident took place. Viron transit also alleges that its subsidiary liability cannot be enforced since Sibayan was not ordered to pay damages in the criminal case, in sitting Art. 103 of Revised Penal Code the civil aspect of the case were instituted in the criminal case and no reservation to file a separate civil case was made. Respondents likewise allege that the petitioners should have appealed the adverse order of the trial court. Petitioners filed a reply and the private respondents also filled a rejoinder both in reiteration of their arguments. Hence this petition.

Issues:

Whether or not the dismissal of the action was based on culpa aquiliana is a bar to the enforcement of the subsidiary liability of the employer?

Held:

The dismissal of the action based on culpa aquiliana is not a bar to the subsidiary liability of the employer. Because the Article 103 of the R.P.C. operates with controlling force to obviate the possibility of the aggrieved party being deprived of indemnity even after the rendition of a final judgment convicting the employee. The trial court should not have dismissed the complaint on the ground of prescription, but instead allowed the complaint for damages ex delicto to be prosecuted on the merits, this does not offend the policy that the reservation or institution of a separate civil waives the other civil actions but this is merely an avoidance of multiple suits. The action for damages based on quasi- delict should be considered waived no occasion for petitioners to file multiple suits against private respondets as available to them is to pursue damages ex delicto.

G.R. No. 116617 November 16, 1998

METRO MANILA TRANSIT CORPORATION (MMTC), PEDRO A. MUSA, CONRADO TOLENTINO, FELICIANA CELEBRADO and THE GOVERNMENT SERVICE INSURANCE SYSTEM, petitioners, vs.COURT OF APPEALS, SPS. RODOLFO V. ROSALES and LILY R. ROSALES, respondents.

G.R. No. 126395 November 16, 1998

RODOLFO V. ROSALES, and LILY R. ROSALES, petitioners, vs.THE COURT OF APPEALS, METRO MANILA TRANSIT CORPORATION, (MMTC) PEDRO A. MUSA, CONRADO TOLENTINO, FELICIANA CELEBRADO and THE GOVERNMENT SERVICE INSURANCE SYSTEM, respondents.

Facts:

Musa was the driver of MMTC bus no. 27 (MMTC an operator of a passenger busses within the Metro Manila area). The spouses Rosales were parents of Liza Rosalie who was hit by

Musa, when crossing Katipunan Avenue in Quezon City. A witness said that that Liza was already near the center of the street when the bus hit her. Musa is found guilty of reckless imprudence resulting in homicide and sentenced imprisonment to maximum penalty by the Regional Trial Court. The spouses Rosales filed an independent civil action for damages against MMTC, Musa, MMTC Acting General Manager Conrado Tolentino, and the Government Service Insurance System (GSIS). The Regional Trial Court of Quezon City found MMTC and Musa guilty of negligence and ordered them to pay damages and attorney’s fees.

The parties appealed both to the Court of Appeals. The court affirmed the decision of the trial court with the modification of deleting the Actual damages and awarding in lieu thereof the death indemnity. The spouses filed a motion for reconsideration in a resolution to partly granted by increasing the indemnity for the death of Liza Rosalie. Musa and MMTC assailed the decision of Court of Appeals. The spouses Rosales contended that the death indemnity set at Actual damages, increasing the amount of damages awarded, and to hold all the defendants-respondents solidarily liable. The conclusions of the Court of Appeals affirm the trial court bars a reversal of the finding of liability against petitioners MMTC and Musa, that such findings are whimsical, capricious, and arbitrary can they be overturned. To the contrary both the Court of Appeals and Regional Trial Court are anchored on the evidence submitted by the parties.

Issue:

(1) Whether or not the employers are held liable for the damages caused by their employees (art. 2180 of Civil Code)

(2) Whether or not the question of damages are subject of the appeal

(3) Whether or not the Court of Appeals erred in absolving the GSIS liability

Held:

(1) The Supreme Court cannot consider the same as sufficiently persuasive proof that there was observance of due diligence in the selection and supervision of employees, they fail to submit any other evidence which might obviate the nature of the testimony. MMTC is primarily liable for damages for the negligence of its employee in view of Art. 2180. Pursuant to Art. 2181 it can recover from its employee what it may pay; the spouses have the option of enforcing the judgment against either MMTC or Musa. The court held that the responsibility of two or more persons who are liable for a quasi delict is solidary, in view of Art. 2194.

(2) The court held the question of damages. (1) As to the indemnity for Death, it is fixed at P50, 000 to conform the Court of Appeals increased the indemnity. (2) Actual Damages, based on Article 2199 that one is entitled to an “adequate compensation only for such pecuniary loss suffered by as duly proved”. The spouses Rosales only submitted receipts showing that the expenses were only P60, 226.65. Hence the spouses Rosales are entitled to recover only the P60, 226.65. (3) Moral Damages under Art. 2206 the ascendants of the deceased may demand moral damages for mental anguish by reason of the death of the deceased. The spouses Rosales presented evidence of the intense moral suffering they had gone through as a result of the loss of Liza Rosalie who was their youngest child; (People v Teehankee) the Court awarded P1 million as moral damages for the loss of a minor child. Hence the Court holds that the MMTC and Musa are solidarily liable to the spouses Rosales in the amount of P1 million as Moral damages for the death of Liza Rosalie. (4) Exemplary damages. It is recovered upon the case involving quasi-delicts if the defendants acted with gross negligence, the records indicate that

there was a pending criminal case against Musa with another branch of the Regional Trial Court, Quezon City for reckless imprudence resulting in slight physical injuries; it also shows that he failed to stop his vehicle at once after the eye witnesses shouted at him. Under the circumstances the Court deemed it reasonable to award the spouses Rosales Exemplary damages in the amount of P5000, 000. (5) Attorney’s Fees. In pursuant of Article 2208, attorney’s fees may be recovered when, exemplary damages are awarded. We held an award of attorney’s fees to be reasonable (Sulpicio Lines V Court of Appeals) the death of a minor child in the sinking of the vessel. (6) Compensation for Loss of Earning Capacity. The compensation of this nature is awarded not for loss of earnings but for loss of capacity to earn money. (People v Teehankee) compensation should be allowed for loss of earning capacity resulting from the death of a minor. Evidence shows that Liza Rosalie was a good student, promising artist, and obedient child. The total net earning capacity (life expectancy is equivalent to 2/3 multiply by the difference of eighty (80) and the age of the deceased) amounts to P321, 870.12.

(3) With respect to the GSIS, they contended that it was the insurer in a contract for third party liability it had with the MMTC. In Article 2180 (4) mentions “managers” this term is used in the sense of “employers”. Thus, Tolentino and Celebrado cannot be held for the tort of Pedro Musa. The GSIS admitted in its answer that it was the insurer of the MMTC for the third party liability with respect to MMTC Bus no. 27 to the extent of P 50,000. Hence the spouses have the option to claim the said amount from the GSIS.

EQUITABLE LEASING CORPORATION VS LUCITA SUYOM, MARISSA ENAMO, MYRNA TAMAYO & FELIX OLEDAN

G.R. no. 143360 September 5, 2002

Facts:

Raul Tutor was the driver of a Fuso tractor rammed into the house cum store of Myrna Tamayo. Was charged and convicted of reckless imprudence resulting in multiple homicide and multiple physical injuries in Metropolitan Trial Court of Manila. Respondents filed against Raul Tutor, Ecatine Corporation and Equitable Leasing Corporation a complaint for damages docketed as Civil case in the RTC of Manila. Upon motion of the plaintiffs’ counsel in the Trial court an order dropping Raul Tutor, Ecatine and Edwin Lim from the Complaint, because they could not be found. Petitioners answer with counterclaim that the vehicle had already been sold to Ecatine and that Tutor was an employee not of Equitable, but of Ecatine.

The RTC rendered its Decision ordering petitioner to pay actual and moral damages and attorney’s fee to the respondents it held that since the Deed of Sale between petitioner and Ecatine had not been registered with the Land Transportation Office, thus the petitioner was liable to respondents.

The Court of Appeals held that petitioner was still to be legally deemed the owner/ operator of the tractor, even if that vehicle had been the subject of a Deed of Sale on file with the LTO still remained in petitioners’ name. And CA upheld respondents to claim for moral damages against petitioner because the appellate court considered Tutor (driver) an agent of the registered owner/ operator.

Issues:

(1) Whether or not the Court of Appeals and the trial Court gravely erred when they decided and held that petitioners was liable for damages suffered by private respondents based on quasi-delict for the negligent acts of a driver who was not the employee of the petitioner

(2) Whether or not the Court of Appeals and the trial court gravely erred when they awarded moral damages to private respondents despite their failure to prove that the injuries they have suffered brought by the petitioner’s wrongful act.

Held:

(1) In negligence cases under Article 103 of the Revised Penal Code, employers may be held subsidiarily liable for felonies, committed by their employees in the discharge of the latter’s duties. This liability attaches when the employees found to be insolvent and thus unable to satisfy the civil liability adjudged. Under Article 2176 in relation to Article 2180 of the Civil Code, and quasi-delict may be instituted against the employer for an employee’s act or omission, respondents having failed to recover anything in the criminal case. The evidence is clear that the deaths and the injuries suffered by respondents and their kins were due to the fault of the driver of the Fuso tractor. The lease Agreement of between petitioner and Edwin Lim stipulated that ownership of the subject tractor will be registered in the name of the petitioner, until the value of the vehicle has been fully paid. Thus the deaths and the injuries complained of, because it was the registered owner of the tractor at the time of the accident.

(2) Moral damages is designed to compensate and alleviate in some way the physical suffering, mental anguish, fright, serious anxiety, wounded feelings and similar injury caused by a person. Must proportional to and in approximation of the suffering inflicted, so because moral damages are payment award designed to compensate the claimant for actual injury suffered, not to impose a penalty on the wrong doer. Article 2219 (2) provides that the liability of the petitioner as the registered owner of the vehicle, respondents have satisfactorily shown the existence of the factual basis for the award and its causal connection to the acts of Raul Tutor. Indeed, the damages and injuries suffered by respondents were the proximate result of petitioner’s tortuous act or omission. Thus the evidence gives no doubt that such discretion was properly and judiciously exercised by the trial court.

MR. & MRS. ENGRACIO FABRE, JR. and PORFIRIO CABIL VS. COURT OF APPEALS, THE WORD FOR THE WORLD CHRISTIAN FELLOWSHIP, INC., AMYLINE ANTONIO, JOHN RICHARDS, GONZALO GONZALES, VICENTE V. QUE, JR., ICLI CORDOVA, ARLENE GOJOCCO, ALBERTO ROXAS CORDERO, RICHARD BAUTISTA, JOCELYN GARCIA, YOLANDA CORDOVA, NOEL ROQUE, EDWARD TAN, ERNESTO NARCISO, ENRIQUETA LOCSIN, FRANCIS NORMAN O. LOPES, JULIUS CAESAR, GARCIA, ROSARIO MA. V. ORTIZ, MARIETTA C. CLAVO, ELVIE SENIEL, ROSARIO MARA-MARA, TERESITA REGALA, MELENDA TORRES, MARELLA MIJARES, JOSEFA CABATINGAN, MARA NADOC, DIANE MAYO, TESS PALATA, MAYETTE JOCSON, ARLENE Y. MOTIZ, LIZA MAYO, CARLOS RANARION, ROSAMARIA T. RADOS and BERNADETTE FERRER

G.R. no. 111127 July 26, 1996

Facts:

Engracio Fabre, jr. and his wife were owners Mazda minibus. Private respondent Word for the World Christian Fellowship Inc. arranged with petitioners for the transportation of 33 members of its Young Adults Ministry from Manila to La union and back, paid the amount of P3,000.00. Petitioner Porfirion Cabil drove the minibus. However, the bridge at Carmen was under repair, Cabil take the detour, it was 11:30 pm, the road was slippery because it was raining, causing the bus running at speed 50 kilometers per hour, to skid to the left road shoulder. The bus hit the traffic steel brace and sign along the road and rammed the fence of one Jesus Escano, then turned over and landed on its left side, coming to a full stop only after a series of impacts. Several passengers were injured. The driver claimed that that he did not see the curve until it was too late, because it was dark and no sign on the road.

Seriously injured, Amyline Antonio brought this case in the RTC of Makati. No convincing evidence was shown that the minibus was properly checked for travel to long distance trip. The RTC renders judgment against defendants Mr. & Mrs. Engracio Fabre, Jr. and Porfirio Cabil y Jamil are ordered to pay jointly and severally to the plaintiffs. Court of appeals affirmed the decision of the trial court with respect to Amyline and sustained the trial court’s finding that the petitioner Cabli failed to exercise due care and precaution in the operation of his vehicle. The Court of Appeals held that the Fabre were themselves presumptively negligent. Petitioners raise the following issues;

Issues:

(1) Whether or not petitioners were negligent

(2) Whether or not petitioners were liable for the injuries suffered by private respondents

(3) Whether or not damages can be awarded and in the positive up what extent.

Held:

(1) The court finds that the Fabre failed to exercise the diligence of a good father of the family in the selection and supervision of their employee is fully supported by the evidence on record of by factual findings of the two courts as final and conclusive. As to the driver, Porfirion Cabil given the conditions of the road and considering that the trip was Cabil’s first one outside of Manila, he should have been driven his vehicle at a moderate speed. There is a testimony that, that portion of the road should only be running 20 kilometers per hour, so at the speed of 50 kilometers per hour, Cabil was running very high. Cabil was found by the Court grossly negligent and should be held liable for the injuries suffered by the private respondents Amyline Antonio.

(2) No distinction between one whose principal business activity is the carrying of persons or goods or both, the law avoided distinction between a person or enterprise offering transportation service on a regular or scheduled basis. As common carriers the Fabre should exercise “extraordinary diligence for the safe transportation of the passengers to their destination. Supporting the finding of the trial court and of the appellate court that petitioners are liable under Arts. 2176 and 2180 for quasi-delict, fully justify findings them guilty of breach of contract of carriage the Civil Code.

(3) The award of damages should be awarded and in favor of Amyline Antonio. The award of exemplary damages and attorney’s fees was also properly made. However, for the same reason that it was error for the appellate court to increase the award of compensatory damages, we

hold that it was also error for it to increase the award of moral damages and reduce the award of attorney’s fees, inasmuch as private respondents, in whose favor the awards were made, have not appealedWithin the purview of Art. 2219 (2) providing for the payment of moral damages in cases of quasi delict. Thus the petitioners are ordered to pay jointly and severally the private respondent Amyline Antonio.

AMADOR CORPUA and ROMEO GONZALESVSEDISON LUGUE and CATHERINE BALUYOT

G.R. no. 137772 July 29, 2005

Facts:

Jimmy Basilio was driving the Isuzu KC-20 passenger jeep it collided with the tanker truck driven by Gerardo Lim, the K-20 was thrown towards the left lane and it was bumped by Mazda Minibus being driven by herein Romeo Gonzales who was then trying to overtake the KC-20, as a result of the impact, the K-C20 was thrown across the highway where it was again hit by the minibus pushing the former towards a deep portion on the left side of the road. The passengers of KC-20, including respondent Edison Lugue suffered Physical injuries. Lugue the victim filed an action for damages from the incident before the RTC of Balanga against Amador Corpuz and Romeo Gonzales (owner and driver of the minibus); Oscar Jaring and Gerardo Lim (owner and driver of the tanker truck) the defendants filed a third-party complaint against Ricardo Santiago and Jimmy Basilio (owner/operator and driver of the KC-20). The Trial Court rendered a decision holding jointly and severally liable Ricardo Santiago, Jimmy Basilio, Oscar Jaring, Gerardo Lim, Amador Corpuz, and Romeo Gonzales. The court renders decision in favor of the plaintiffs and against all the defendants and third-party defendants.

Oscar Jaring and Gerardo Lim appeals on the Court of Appeals the court dismissed the plaintiffs Santiago and Basilio. The Court of Appeals Affirmed with the Trial courts decision and modified that Defendants Ricardo Santiago and Jimmy Basilio are declared jointly and severally liable with defendants-appellants Amador Corpuz and Romeo Gonzales and Defendants-appeallants Oscar and Gerardo Lim are absolved from liability and the complaint as against them is Dismissed. Hence Amador Corpuz and Romeo Gonzales filed and instant petition.

Issue:

Whether or not the appellate court erred in holding them liable for damages based on the findings of facts adduced by the trial court.

Held:

From the testimonies as well as the discussion of the Trial Court, it is clear that the proximate cause of the injuries suffered by respondents Lugue was the collision between the KC-20 and the Tanker truck. It is clear that it was the reckless imprudence of the driver of the KC-20, Jimmy Basilio, which set the other events in motion which eventually led to the passengers of the KC-20 sustaining physical injuries. However no merit in appeal of Amador Corpuz and Romeo Gonzales ( Mazda minibus) in its testimony that Gonzales signaled to avoid hitting the

KC-20, petitioner failed to do so because the KC-20 had moved to the position blocking the way of the minibus. The Court granted the petition, the decision of the Court of Appeals finding petitioners liable is Reversed and Set aside, in all other respect the court Affirmed with the other decision.

CONRADO AGUILAR, SR.VSCOMMERCIAL SAVINGS BANK and FERNAND BORJA

G.R. no. 128705 July 29, 2001

Facts:

Conrado Aguilar, Sr. is the father of the victim (Conrado aguilar, Jr.) in a vehicular accident involving a Lanser car registered in the name of the respondent bank and was driven by Ferdinand G. Borja (assistant vice president of Commercial Bank). As Aguilar Jr. and his companions crossed the road, the lancer driven by Fernand Borja, overtook a passenger jeepney the lanser hit Aguilar and Semella (friend) and caused their death. Conrado, Sr. filed a complaint for damages against the respondents in the Regional Trial Court of Makati. Within the reglementary period Borja did not file his answer he was then declared in default by the trial court. Petitioners counsel showed that Borja was negligent in driving the car. The trial court held defendants (respondents) liable for Aguilar’s death ordering the defendants, jointly and severally to pay to the plaintiff damages. On the cross-claim of the defendant bank, the cross-defendant Ferdinand Borja is ordered to pay the cross-claimant whatever amount the latter may have paid by virtue of decision. The trial court declared that Borja’s negligence, carelessness & imprudence caused the victim’s death. Article 2180 of the Civil code, the negligence of the employee is presumed to be that of the employer, whose liability is primarily and direct and that respondents bank failed to exercise due diligence in the selection of its employees.

Respondent bank appealed to the Court of Appeals, the Court of Appeals found it meritorious the appellate court found no evidence that Borja had acted as respondent bank’s assistant vice-president at the time of the mishap. The court of appeals reversed the trial court’s decision. Petitioner’s motion for reconsideration was denied. Hence this petition.

Issue:

Whether or not respondent bank, as the lancer’s owner, is liable for damages.

Held:

The Supreme Court hold with the trial court that the law does not allow the respondents to do so; the law, with its aim and policy in mind, does not relieve him directly of the responsibility that the law fixes and places upon him as incident or consequence of registration. The respondent bank has no any justification for relieving him of liability the failure to comply with the registration that the law demands and requires. And that the defendant- appellant herein, is primarily responsible for the damage caused to the vehicle of the plaintiff-appellee, but he

has a right to be indemnified by the real actual owner of the amount that he may be required to pay as damage for the injury caused to the plaintiff-appellant. For as long as the respondent bank remained the registered owner of the car involved in the vehicular accident, it could not escape primary liability for the death of petitioner’s son.

PROFESSIONAL SERVICES, INC.VSNATIVIDAD and ENRIQUE AGANA

G.R. no. 126297 January 31, 2007

NATIVIDAD and ENRIQUE AGANAVSJUAN FUENTES

G.R. no. 127590 January 31, 2007

Facts:

Natividad Agana was rushed to the Medical City Hospital Dr. Miguel Ampil diagnosed her to be suffering from “cancer of the sigmoid”. Dr. Ampil performed the surgery and found the malignancy in her sigmoid necessitating the removal. Dr. Juan Fuentes performs hysterectomy Dr. Ampil took over, completed the operation and closed the incision. The attending nurse entered the remarks that the sponge count lacking 2. Since nowhere to be found the surgeon avail to continue closure. After a couple of days, Natividad complained of excruciating pain she consulted both the doctors about it but they told that it was natural consequence of the surgery. Dr. Ampil. Natividad, went to the United States after four months of consultation and laboratory examinations, she was free of cancer. Natividad flew back to the Philippines, still suffering from pains, her daughter found gauze protruding from her Vagina. Then after the pain intensified, prompting Natividad to seek treatment. Dr. Ramon Gutierez detected the presence of another foreign object in her vagina – a foul-smelling gauze which badly infected her vaginal vault. Natividad underwent another surgery to remedy the damage.

Natividad and her husband filed with the RTC, Quezon City a complaint for damages against the Professional Services, Inc. (PSI), owner of the Medical City Hospital, Dr. Ampil, and Dr. Fuentes. Enrique Agana also filed with the Professional Regulation Commission (PRC) an administrative complaint for gross negligence and malpractice against Dr. Ampil and Dr. Fuentes. The PRC Board of Medicine heard the case but it failed to acquire jurisdiction over Dr. Ampil who was then in the United States. The case was pending; Natividad died and was duly substituted by her above-named children (the Aganas). RTC rendered its Decision in favor of the Aganas, finding PSI, Dr. Ampil and Dr. Fuentes liable for negligence and malpractice, ordering the defendants PROFESSIONAL SERVICES, INC., Dr Miguel Ampil and Dr. Juan Fuentes to pay to the plaintiffs, jointly and severally, except in respect of the award for exemplary damages and the interest thereon which are the liabilities of defendants Dr. Ampil and Dr. Fuentes.

Aggrieved, PSI, Dr. Fuentes and Dr. Ampil interposed an appeal to the Court of Appeals, Aganas filed with the RTC a motion for a partial execution of its Decision. Aganas again filed a motion for an alias writ of execution against the properties of PSI and Dr. Fuentes. RTC granted the motion and issued the corresponding writ, prompting Dr. Fuentes to file with the Court of Appeals a petition for certiorari and prohibition, with prayer for preliminary injunction. During

its pendency, the Court of Appeals issued a Resolution5 granting Dr. Fuentes’ prayer for injunctive relief.

PRC Board of Medicine rendered its Decision in Administrative Case dismissing the case against Dr. Fuentes. The prosecution failed to show that Dr. Fuentes was the one who left the two pieces of gauze inside Natividad’s body. The Court of Appeals rendered its Decision Dr. Miguel Ampil is liable to reimburse defendant-appellant Professional Services, Inc., whatever amount the latter will pay or had paid to the plaintiffs-appellees. Dr. Ampil filed a motion for reconsideration, but it was denied in a Resolution

Aganas maintain that the Court of Appeals erred in finding that Dr. Fuentes is not guilty of negligence or medical malpractice, invoking the doctrine of res ipsa loquitur. Dr. Ampil asserts that the Court of Appeals erred in finding him liable for negligence and malpractice.

Issues:

(1) Whether the Court of Appeals erred in holding Dr. Ampil liable for negligence and malpractice

(2) Whether the Court of Appeals erred in absolving Dr. Fuentes of any liability

(3) Whether PSI may be held solidarily liable for the negligence of Dr. Ampil.

Held:

(1) Dr. Ampil is liable for Negligence and Malpractice, an attempt to absolve himself, gears the Court’s attention to other possible causes of Natividad’s detriment. His arguments are purely conjectural and without basis. He did not present any evidence to prove that the American doctors were the ones who put or left the gauzes in Natividad’s body. Neither submit evidence to rebut the correctness of the record of operation, particularly the number of gauzes used. As to the alleged negligence of Dr. Fuentes, we are mindful that Dr. Ampil examined his (Dr. Fuentes’) work and found it in order.

(2) The court is not convinced, that the Court of Appeals Erred in Absolving Dr. Fuentes of any Liability. It was duly established that Dr. Ampil was the lead surgeon during the operation of Natividad. He requested the assistance of Dr. Fuentes only to perform hysterectomy when he (Dr. Ampil) found that the malignancy in her sigmoid area had spread to her left ovary. Dr. Fuentes performed the surgery and thereafter reported and showed his work to Dr. Ampil. The latter examined it and finding everything to be in order, allowed Dr. Fuentes to leave the operating room. Dr. Ampil then resumed operating on Natividad. He was about to finish the procedure when the attending nurses informed him that two pieces of gauze were missing. A "diligent search" was conducted, but the misplaced gauzes were not found. Dr. Ampil then directed that the incision be closed. During this entire period, Dr. Fuentes was no longer in the operating room and had, in fact, left the hospital.

(3) The issue of whether PSI is solidarily liable with Dr. Ampil for damages, that PSI, failed to adduce evidence showing that it exercised the diligence of a good father of a family in the accreditation and supervision of the latter. Moreover PSI is also directly liable to the Aganas. When a doctor practices medicine in a hospital setting, the hospital and its employees are deemed to sub serve him in his ministrations to the patient and his actions are of his own

responsibility. The nature of the relationship between the hospital and the physicians is an employer-employee relationship the hospitals exercise significant control in the hiring and firing of consultants and in the conduct of their work within the hospital premises. Doctors who apply for ‘consultant’ slots, are required to submit proof of completion of residency, their educational qualifications, evidence of accreditation by the appropriate board (diplomate), evidence of fellowship in most cases, and references. These requirements in other words, private hospitals, hire, fire and exercise real control over their attending and visiting ‘consultant’ staff. The hiring, and the right to terminate consultants all fulfill the important hallmarks of an employer-employee relationship, with the exception of the payment of wages. PSI publicly displays in the lobby of the Medical City Hospital the names and specializations of the physicians associated or accredited by it, including those of Dr. Ampil and Dr. Fuentes. PSI failed to discharge its burden under the last paragraph of Article 2180 cited must be adjudged solidarily liable with Dr. Ampil.

ROGELIO P. NOGALES, for himself and on behalf of the minors, ROGER ANTHONY, ANGELICA, NANCY, and MICHAEL CHRISTOPHER, all surnamed NOGALES, petitioners, vs.CAPITOL MEDICAL CENTER, DR. OSCAR ESTRADA, DR. ELY VILLAFLOR, DR. ROSA UY, DR. JOEL ENRIQUEZ, DR. PERPETUA LACSON, DR. NOE ESPINOLA, and NURSE J. DUMLAO, respondents.

G.R. No. 142625 December 19, 2006

Facts:

Corazon Nogales ("Corazon"), 37 years old pregnant with her fourth child, under the exclusive prenatal care of Dr. Oscar Estrada ("Dr. Estrada"). The Doctor noted an increase in her blood pressure and development of leg edema indicating preeclampsia. Corazon started to experience mild labor pains Dr. Estrada advised her immediate admission to the Capitol Medical Center ("CMC"). The staff nurse noted the written admission request of Dr. Estrada. Due to the "Consent on Admission and Agreement" and "Admission Agreement" signed by Corazon’s husband she was then brought to the labor room of the CMC.

Corazon manifest moderate vaginal bleeding which rapidly became profusely, Dr. Espinola ordered immediate hysterectomy. Rogelio was made to sign”Consent to Operation." Due to the inclement weather, Dr. Espinola arrived an hour late. He examined the patient and ordered some resuscitative measures to be administered. Despite Dr. Espinola's efforts, Corazon died the cause of death was "hemorrhage, post partum."

Petitioners filed a complaint for damages with the Regional Trial Court of Manila contending that defendant physicians and CMC personnel were negligent in the treatment and management of Corazon's condition also in the selection and supervision of defendant physicians and hospital staff. The defendant fail to file their answer to the complaint the trial court declared Dr. Estrada, Dr. Enriquez, and Nurse Dumlao in default. CMC, Dr. Villaflor, Dr. Uy, Dr. Espinola, and Dr. Lacson filed their respective answers denying and opposing the allegations in the complaint. The trial court rendered judgment finding Dr. Estrada solely liable for damages.

Petitioners appealed the trial court's decision, The Court of Appeals affirmed the decision of the trial court. Petitioners filed a motion for reconsideration which was denied in its

Resolution. Hence, petitioners filed a Manifestation that respondents "need no longer be notified of the petition because they are not involved in the issue raised before the [Court], regarding the liability of [CMC]." The Court of Appeals concluded that since Rogelio engaged Dr. Estrada as the attending physician of his wife, any liability for malpractice must be Dr. Estrada's sole responsibility. While it found the amount of damages fair and reasonable, the Court of Appeals held that no interest could be imposed on unliquidated claims or damages. Hence this petition.

Issue:

Whether or not CMC is vicariously liable for the negligence?

Held:

On the Liability of CMC

CMC is vicariously liable for Dr. Estrada's negligence based on Article 2180 in relation to Article 2176 of the Civil Code. Art. 2180. The obligation imposed by article 2176 is demandable not only for one's own acts or omissions, but also for those of persons for whom one is responsible. Employers shall be liable for the damages caused by their employees. The records show that Rogelio testified that he and his wife specifically chose Dr. Estrada to handle Corazon's delivery not only because of their friend's recommendation, but more importantly because of Dr. Estrada's "connection with a reputable hospital, to provide the best medical care and support services for Corazon's delivery.

On the Liability of the Other Respondents

There was no evidence showing that the other respondents are liable for negligent act. The records show that all are acting with good faith.

On the Award of Interest on Damages

The award of interest on damages is proper and allowed under Article 2211 of the Civil Code, which states that in crimes and quasi-delicts, interest as a part of the damages may, in a proper case, be adjudicated in the discretion of the court. The Court partly grants the petition finds respondent Capitol Medical Center vicariously liable for the negligence of Dr. Oscar Estrada. The actual damages and moral damages should each earn legal interest at the rate of six percent (6%) per annum computed from the date of the judgment of the trial court.

JOSE S. AMADORA, LORETA A. AMADORA, JOSE A. AMADORA JR., NORMA A. YLAYA PANTALEON A. AMADORA, JOSE A. AMADORA III, LUCY A. AMADORA, ROSALINDA A. AMADORA, PERFECTO A. AMADORA, SERREC A. AMADORA, VICENTE A. AMADORA and MARIA TISCALINA A. AMADORA, petitioners vs.HONORABLE COURT OF APPEALS, COLEGIO DE SAN JOSE-RECOLETOS, VICTOR LLUCH SERGIO P. DALMASO JR., CELESTINO DICON, ANIANO ABELLANA, PABLITO DAFFON thru his parents and

natural guardians, MR. and MRS. NICANOR GUMBAN, and ROLANDO VALENCIA, thru his guardian, A. FRANCISCO ALONSO, respondents.

G.R. No. L-47745 April 15, 1988

Facts:

Alfredo Amadora (17years old) scheduled to graduate High School on April 16, 1972. On April 13, 1972, while in their school, Pablito Daffon, fired a gun that mortally hit Alfredo, ending all his expectations and his life as well. Daffon petitioners, as the victim's parents was convicted of homicide thru reckless imprudence and filed a civil action for damages under Article 2180 of the Civil Code against the Colegio de San Jose-Recoletos, its rector, school principal, the dean of boys, and the physics teacher, together with Daffon and two other students, through their respective parents. The complaint against the students was later dropped. After trial, the Court of First Instance of Cebu held the remaining defendants liable to the plaintiffs representing death compensation, loss of earning capacity, costs of litigation, funeral expenses, moral damages, exemplary damages, and attorney's fees. On appeal to the respondent court, the decision was reversed and all the defendants were completely absolved. Hence this petition.

Issues:

(1) Whether or not the Colegio de San Jose-Recoletes liable

(2) Whether or not the rector, the high school principal and the dean of boys liable

(3) Whether or not the teacher-in-charge is liable

(4) Whether or not the absence of a teacher-in-charge is a probability that the dean of boys be held liable

(5) Whether or not the Colegio de San Jose-Recoletos can be held directly liable under the article 1903 of Civil code due to the teacher or the head of the school of arts and trades responsible for the damage caused by the student or apprentice.

Held:

(1) Alfredo Amadora was fatally shot, in the custody of Colegio de San Jose-Recoletos though the fourth year classes had formally ended. It was immaterial if he was in the school to finish his physics experiment or to submit his physics report for what is important is that he was there for a legitimate purpose for going to the premises of the school.

(2) The rector, the high school principal and the dean of boys cannot be held liable because none of them was the teacher-in-charge. Not the direct control and influence exerted by the teacher placed in charge of particular classes the evidence of the parties does not disclose who the teacher-in-charge of the offending student was. The mere fact that Alfredo Amadora had gone to school for his physics report did not necessarily make the physics teacher, respondent Celestino Dicon, the teacher-in-charge of Alfredo's killer.

(3) There was no showing that Dicon as the teacher-in-charged was negligent in enforcing discipline upon Daffon in observance of the rules and regulations of the school, his absence when the tragedy happened cannot be considered against him because he was not supposed or required to report to school on that day. And it has not been established that it was caused by his laxness in enforcing discipline upon the student. On the contrary, the private respondents have proved that they had exercised due diligence, through the enforcement of the school regulations, in maintaining that discipline.

(4) Probably the dean of boys should be held liable in the absence of teacher-in-charged in view of the evidence that he had earlier confiscated an unlicensed gun from one of the students and returned the same later to him without taking disciplinary action or reporting the matter to higher authorities. This was clearly negligence on his part, he deserves sanctions from the school, though it does not link him to the shooting of Amador it has not been shown that he confiscated and returned pistol was the gun that killed the petitioners' son.

(5) Finally, Colegio de San Jose-Recoletos cannot be held directly liable under the article because only the teacher or the head of the school of arts and trades is made responsible for the damage caused by the student or apprentice. It cannot be held to answer for the tort committed by any of the other private respondents for none of them has been found to have been charged with the custody of the offending student or has been remiss in the discharge of his duties in connection with such custody.

AVELINO CASUPANAN and ROBERTO CAPITULO, petitioners, vs.MARIO LLAVORE LAROYA, respondent.

G.R. No. 145391 August 26, 2002

Facts:

Two vehicles, one driven by Mario Llavore Laroya the other owned by Roberto Capitulo and driven by petitioner Avelino Casupanan , figured in an accident. As a result, two cases were filed with the Municipal Circuit Trial Court of Tarlac. Laroya filed a criminal case against Casupanan for reckless imprudence resulting in damage to property. Casupanan and Capitulo also filed a civil case against Laroya for quasi-delict. When the civil case was filed, the criminal case was then at its preliminary investigation stage.

Casupanan and Capitulo filed a Motion for Reconsideration insisted that the civil case is a separate civil action which can proceed independently of the criminal case. The MCTC denied the motion for reconsideration. Casupanan and Capitulo filed a petition for certiorari before the Regional Trial Court of Tarlac, assailing the MCTC’s Order of dismissal.

The RTC rendered judgment dismissing the petition for certiorari for lack of merit. The order of dismissal issued by the MCTC is a final order which disposes of the case and therefore the proper remedy should have been an appeal. The RTC further held that certiorari is not a substitute for a lost appeal. Finally, the RTC declared that even on the premise that the MCTC erred in dismissing the civil case, such error is a pure error of judgment and not an abuse of discretion. Casupanan and Capitulo filed a Motion for Reconsideration but the RTC denied the same .

Issue:

Whether or not the accused in a pending criminal case for reckless imprudence can validly file, simultaneously and independently, a separate civil action for quasi-delict against the private complainant in the criminal case.

Held:

Under the Administrative Circular, the order of dismissal is without prejudice to refiling the complaint, unless the order of dismissal expressly states it is with prejudice. Thus, the MCTC’s dismissal, being silent on the matter, is a dismissal without prejudice. The criminal case is based on culpa criminal punishable under the Revised Penal Code while the civil case is based on culpa aquiliana actionable under Articles 2176 and 2177 of the Civil Code. Any aggrieved person can invoke these articles provided he proves, by preponderance of evidence, that he has suffered damage because of the fault or negligence of another. Either the private complainant or the accused can file a separate civil action under these articles. There is nothing in the law or rules that state only the private complainant in a criminal case may invoke these articles. If the separate civil action was filed before the commencement of the criminal action, the civil action, if still pending, was suspended upon the filing of the criminal action until final judgment was rendered in the criminal action. This rule applied only to the separate civil action filed to recover liability ex-delicto.

FGU INSURANCE CORPORATION, petitioner, vs.COURT OF APPEALS, FILCAR TRANSPORT, INC., and FORTUNE INSURANCE CORPORATION, respondents.

G.R. No. 118889 March 23, 1998

Facts:

Two-car collided at dawn. Both are Mitsubishi Colt Lancers, cruising along Epifanio de los Santos Avenue, Mandaluyong City, figured in a traffic accident. The other owned by Lydia F. Soriano was being driven by Benjamin Jacildone, while the other car, owned by respondent FILCAR Transport, Inc. (FILCAR), and driven by Peter Dahl-Jensen as lessee. The car owned by FILCAR swerved to the right hitting the left side of the car of Soriano. At that time Dahl-Jensen, a Danish tourist, did not possess a Philippine driver's license. FGU Insurance Corporation, paid the latter by way of subrogation, it sued Dahl-Jensen and respondent FILCAR as well as respondent Fortune Insurance Corporation (FORTUNE) as insurer of FILCAR for quasi-delict before the Regional Trial Court of Makati City.

Summons was not served on Dahl-Jensen he was no longer staying at his given address; upon motion of petitioner, Jensen was dropped from the complaint. The trial court dismissed the case for failure of petitioner to substantiate its claim of subrogation. Court of Appeals affirmed the ruling of the trial court although only the fault or negligence of Dahl-Jensen was sufficiently proved but not that of respondent FILCAR, petitioner failed to establish its cause of

action for sum of money based on quasi-delict. Petitioner insists that respondents are liable on the strength being the registered owner of a vehicle and is liable for damages suffered by third persons although the vehicle is leased to another.

Issue:

(1) Whether or not the damages suffered by a third party, may be an action based on quasi-delict against a rent-a-car company

(2) Whether or not its insurer held liable for fault or negligence of the car lessee in driving the rented vehicle

Held:

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

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

RAFAEL REYES TRUCKING CORPORATION, petitioner,

VS.

PEOPLE OF THE PHILIPPINES and ROSARIO P. DY (for herself and on behalf of the minors Maria Luisa, Francis Edward, Francis Mark and Francis Rafael, all surnamed Dy), respondents.

G.R. No. 129029. April 3, 2000

Facts:

Provincial Prosecutor Patricio T. Durian of Isabela filed amended information with Regional Trial Court, charging Romeo Dunca y de Tumol with reckless imprudence resulting in double homicide and damage to property, the said accused being the driver of a Trailer Truck Tractor registered in the name of Rafael Reyes Trucking Corporation, drove and operated in a negligent, careless and imprudent without taking the necessary precautions to prevent injuries to persons and damage to property, causing by such negligence the said trailer truck to hit and bump a Nissan Pick-up driven by Feliciano Balcita and Francisco Dy, Jr., and Pacquing, resulted reckless imprudence resulting in double homicide and damage to property.

Upon arraignment the accused entered a plea of not guilty. The offended party made a reservation to file a separate civil action against the accused arising from the offense charged. The offended parties actually filed with the RTC, Isabela, a complaint against petitioner Rafael Reyes Trucking Corporation, as employer of driver Romeo Dunca y de Tumol, based on quasi delict. The petitioner settled the claim of the heirs of Feliciano Balcita (the driver of the other vehicle involved in the accident). The trial court consolidated both criminal and civil cases and conducted a joint trial of the same. The trial court rendered a joint decision finding the accused Romeo Dunca y de Tumol guilty beyond reasonable doubt of the crime of Double Homicide through Reckless Imprudence with violation of the Motor Vehicle Law, ordering the plaintiff to pay to the defendants the actual damages, and the dismissal of the complaint.

Issues:

(1) Whether or not Rafael Reyes Trucking can be held liable because of filing separate civil action base on quasi-delict

(2) Whether or not the award of damages in the criminal case was proper

Held:

(1) First issue, the answer is in the negative. Rafael Reyes Trucking Corporation, as employer of the accused who has been adjudged guilty in the criminal case for reckless imprudence, can not be held subsidiarily liable because of the filing of the separate civil action based on quasi delict against it. In view of the reservation to file, and the subsequent filing of the civil action for recovery of civil liability, the same was not instituted with the criminal action. Such separate civil action was for recovery of damages under Article 2176 of the Civil Code, arising from the same act or omission of the accused

(2) Second issue, the award of damages in the criminal case was improper because the civil action for the recovery of civil liability was waived in the criminal action by the filing of a separate civil action against the employer, civil indemnity is not part of the penalty for the crime committed." The only issue brought before the trial court in the criminal action is whether accused Romeo Dunca y de Tumol is guilty of reckless imprudence resulting in homicide and damage to property. The action for recovery of civil liability is not included therein, but is covered by the separate civil action filed against the petitioner as employer of the accused truck-driver.

LARRY ESTACION, Petitioner, vs.NOE BERNARDO, thru and his guardian ad litem ARLIE BERNARDO, CECILIA BANDOQUILLO and GEMINIANO QUINQUILLERA, Respondents.

G.R. No. 144723 February 27, 2006

Facts:

Noe Bernardo was a passenger of jeepney driven by Geminiano Quinquillera , owned by respondent Cecilia Bandoquillo, Noe hung or stood on the left rear carrier of the vehicle. The jeepney stopped by the right shoulder of the road to pick up passengers. Suddenly, an Isuzu cargo truck, owned by petitioner and driven by Gerosano, which was traveling in the same direction, hit the rear end portion of the Fiera, the cargo truck smashed respondent Noe against the Fiera crushing his legs and feet which made him fall to the ground. Noe was brought to the Silliman University Medical Center where his lower left leg was amputated. Noe, through his guardian ad litem Arlie Bernardo, filed with the RTC of Dumaguete City a complaint for damages arising from quasi delict against the registered owner of the cargo truck and his driver Gerosano. And he prayed for actual damages, loss of income, moral and exemplary damages, attorney’s fees, litigation expenses and costs of suit.

Owner of the truck and driver Gerosano filed an answer denying the allegations in the complaint. They filed a third party complaint against respondents Bandoquillo and Quinquillera, as owner and driver of the Fiera. The reckless imprudence of the respondent driver was the proximate cause of the accident. Respondents Bandoquillo and Quinquillera filed their answer to the third party complaint asking for the dismissal of the third party complaint and for payment of attorney’s fees.

Driver Gerosano was charged criminally for reckless imprudence resulting to multiple physical injuries with damage to property before the MCTC of Negros Oriental. MCTC finding him guilty of the crime charged and was sentenced him and to pay the costs. RTC rendered its judgment in the civil case ordering defendants Gerosano and Estacion, to pay plaintiff, jointly or solidarily to the actual damages, moral damages, attorney’s fee and the litigation expenses. Petitioner appealed to the CA. CA rendered the assailed decision which affirmed in toto the decision of the trial court. Petitioner’s motion for reconsideration was denied. Hence, the herein petition for review.

Issues:

(1) Whether the Court of Appeals erred in not finding that Larry Estacion exercised a due diligence as of a good father of the family to prevent damage despite the abundance of evidence to that effect;

(2) Whether the court of appeals erred in not holding that Larry Estacion exercised due diligence in the selection and supervision of his employee and in maintaining his cargo truck roadworthy and in good condition

(3) Whether the court of appeals erred in exonerating respondents Cecilia Bandoquillio and Geminiano Quinquillera.

Held:

(1) The court held that petitioner failed to overcome the presumption of negligence thus he is liable for the negligence of his driver Gerosano; the respondents failed to prove it otherwise. The obligation imposed by Article 2176 is demandable not only for one’s own acts or omissions, but also for those of persons for whom one is responsible.

(2) There was also no proof that he exercised diligence in maintaining his cargo truck roadworthy and in good operating condition. While petitioner’s mechanic driver testified that he made a routine check up on October 15, 1982, one day before the mishap happened, and found the truck operational, there was no record of such inspection.

(3) Modification for the ruling of the Court of Appeals that respondents Bandoquillo and Quinquillera are liable for the negligent act of their driver. The judgment was ordering defendants Gerosano and Estacion, as well as third party defendants Bandoquillo and Quinquillera, to pay plaintiff, jointly and solidarily, the award of damages, since there was contributory negligence on the part of respondent Noe, petitioner’s liability should be mitigated in accordance with Article 2179.

RADIO COMMUNICATIONS OF THE PHILIPPINES, INC. (RCPI),Petitioner, vs.ALFONSO VERCHEZ, GRACE VERCHEZ-INFANTE, MARDONIO INFANTE, ZENAIDA VERCHEZ-CATIBOG, AND FORTUNATO CATIBOG, Respondents.

G.R. No. 164349 January 31, 2006

Facts:

Editha Hebron Verchez was confined due to an ailment. Grace Verchez-Infante (daughter) went to the Radio Communications of the Philippines, Inc. (RCPI) to send a telegram to her sister Zenaida Verchez-Catibog (Zenaida) who was residing at Quezon City reading: "Send check money Mommy hospital." Grace paid was issued a receipt. Three days after, no response received from her, Grace sent a letter to Zenaida, thru JRS Delivery Service, reprimanding her for not sending any financial aid. After Zenaida received Grace’s letter, with her husband Fortunato Catibog, left for Sorsogon. On her arrival she disclaimed having received any telegram. Zenaida, and her husband, brought Editha to the Veterans Memorial Hospital.

The telegram from RCPI was delivered to Zenaida 25 days later, Editha’s husband Alfonso Verchez (Verchez), by letter demanded an explanation from the manager of the Service Quality Control Department of the RCPI, Mrs. Lorna D. Fabian, who replied, that due to the occurrence of radio link connecting the points of communication encountered radio noise and interferences such that subject telegram did not initially registered in the receiving teleprinter machine .

Verchez’s lawyer thereupon wrote RCPI’s manager Fabian, by letter requesting for a conference but no representative of RCPI showed up at said date and time. On April 17, 1992, Editha died. Verchez, with his daughters Grace and Zenaida and spouses, filed a complaint against RCPI before the RTC for damages, the judgment of RTC rendered in favor of the plaintiffs and against the defendant, and on appeal, the Court of Appeals, affirmed the trial court’s decision. Hence, RCPI’s present petition for review on certiorari at the Supreme Court

Issue:

(1) "Is the award of moral damages proper even if the trial court found that there was no direct connection between the injury and the alleged negligent acts?

(2) "Are the stipulations in the ‘Telegram Transmission Form,’ in the nature "contracts of adhesion?

Held:

(1) RCPI’s stand fails. Its liability is anchored on culpa contractual or breach of contract with regard to Grace, and on tort with regard to her co-plaintiffs-herein-co-respondents. Base on Article 1170 of the Civil Code provides: “Those who in the performance of their obligations are guilty of fraud, negligence, or delay, and those who in any manner contravene the tenor thereof, are liable for damages.

Passing on this codal provision, this Court explained:

In culpa contractual x x x the mere proof of the existence of the contract and the failure of its compliance justify, prima facie , a corresponding right of relief . The law, recognizing the obligatory force of contracts, will not permit a party to be set free from liability for any kind of misperformance of the contractual undertaking or a contravention of the tenor thereof. A breach of contract confers upon the injured party a valid cause for recovering that which may have been lost or suffered.

(2) RCPI misunderstands the nature of a contract of adhesion. It is construed strictly against the party who drafted it or gave rise to any ambiguity therein, it is stricken down as void and unenforceable or subversive of public policy when the weaker party is imposed upon in dealing with the dominant bargaining party and is reduced to the alternative of taking it or leaving it, completely deprived of the opportunity to bargain on equal footing. This Court holds that the contract is one of adhesion which is void is, given the facts and circumstances of the case the petition is DENIED, and the decision of the Court of Appeals is AFFIRMED.

V.V. SOLIVEN REALTY CORP., PETITIONER, VS. LUIS KUNG BENG T. ONG., RESPONDENT.

G.R. No. 147869, January 26, 2005

Held:

V.V. Soliven Realty Corp. and Luis Kung Beng T. Ong signed a Contract to Sell. After 10 years from the signing of the Contract to Sell, despite respondent’s full payment of the purchase price, petitioner failed and refused to execute the deed of absolute sale and to deliver to respondent the certificate of title over the lot. Respondent filed a letter-complaint with the Housing and Land Use Regulatory Board (“HLURB”) praying for the delivery of the certificate of title over the lot and the refund of his excess payment.

Petitioner denied respondent’s allegation of full payment of the purchase price of the lot and the excess payment on the amortization. HLURB found that respondent had already fully paid the purchase price of the lot and that he had an excess payment.

Petitioner filed a petition for review with the HLURB Board of Commissioners which affirmed in toto the decision HLURB. Petitioner appealed the decision of the HLURB Board of Commissioners to the Office of the President. Petitioner claimed that respondent had “no cause of action because the subject lot was levied [on] execution in connection with Civil, hence the same should be deemed lost through fortuitous event.”

Unknown to respondent, the lot was levied on execution on in Civil Case. Subsequently, a certificate of sale was annotated on the certificate of title. However, petitioner was able to redeem the lot. Before its redemption, petitioner subdivided the lot into two. Consequently, the certificate of title to the lot, one of the subdivided lot was cancelled and two certificates of title were issued, petitioner sold one of the property to a certain Rogelio Vizon Carpio, Jr.

Meanwhile, the Office of the President dismissed petitioner’s appeal and affirmed the decision of the HLURB Board of Commissioners. Petitioner filed a petition with the Court of Appeals questioning the decision of the Office of the President. The Court of Appeals denied the petition.

Issues:

THE COURT OF APPEALS ERRED IN AWARDING DAMAGES AND ATTORNEY’S FEES WHEN THE SAME WAS NOT SPECIFICALLY PRAYED FOR IN THE COMPLAINT. EVEN GRANTING THAT THERE WAS A PRAYER FOR DAMAGES AND ATTORNEY’S FEES, RESPONDENT FAILED TO FURNISH SUFFICIENT BASIS FOR [SUCH] AWARD.

Held:

True, respondent failed to allege specifically in the complaint his claim for damages and attorney’s fees. This lack of specific allegation is understandable because no counsel assisted respondent at the time. It was only when the instant case reached the Court of Appeals when respondent’s substitute (Ma. Dolores T. Ong), who was already represented by counsel, expressly pleaded for damages and attorney’s fees.

Respondent’s substitute attached an affidavit to her comment to the petition before the Court of Appeals stating that respondent’s death was “partly due to the stress, frustration over the lot as he had suffered sleepless nights, mental anguish and anxiety.” The affidavit further stated that “petitioner has caused [her] family great anxiety, mental anguish and injury.” this Court can award nominal damages to respondent’s heirs. Nominal damages are not intended for indemnification of loss suffered but for the vindication or recognition of a right violated or invaded. Nominal damages are recoverable where the plaintiff has suffered some injury the amount of which the evidence fails to show. The Court also sets aside the award of attorney’s fees for lack of basis.

G.R. No. 122039 May 31, 2000

VICENTE CALALAS, petitioner,vs.COURT OF APPEALS, ELIZA JUJEURCHE SUNGA and FRANCISCO SALVA, respondents.

Facts:

Eliza Jujeurche G. Sunga, a college freshman at the Siliman University, took a passenger jeepney owned and operated by petitioner Vicente Calalas. Sunga was given by the conductor an "extension seat," at the rear end of the vehicle. Sunga gave way to the outgoing passenger. Just as she was doing so, an Isuzu truck driven by Iglecerio Verena and owned by Francisco Salva bumped the left rear portion of the jeepney. As a result, Sunga was injured and confinement in the hospital. Her attending physician certified she would remain on a cast for a period of three months and would have to ambulate in crutches during said period.

Sunga filed a complaint for damages against Calalas, alleging violation of the contract of carriage. Calalas, on the other hand, filed a third-party complaint against Francisco Salva, the owner of the Isuzu truck. The lower court rendered judgment against Salva as third-party defendant and absolved Calalas of liability, holding that it was the driver of the Isuzu truck who was responsible for the accident. It took cognizance of another case, filed by Calalas against Salva and Verena, for quasi-delict, the same court held Salva and his driver Verena jointly liable to Calalas for the damage to his jeepney.

On appeal to the Court of Appeals, the ruling of the lower court was reversed and dismissed the third-party complaint against Salva and adjudged Calalas liable for damages to Sunga. Hence this petition.

Issues:

(1)Whether or not the negligence of Verena was the proximate cause of the accident negates the liability and that to rule otherwise would be to make the common carrier an insurer of the safety of its passengers.

(2) Whether or not that the bumping of the jeepney by the truck owned by Salva was a caso fortuito.

(3) Whether or not the award of moral damages to Sunga is supported evidence.

Held:

(1) Finding Salva and his driver Verena liable for the damage to petitioner's jeepney, should be binding on Sunga. It is immaterial that the proximate cause of the collision between the jeepney and the truck was the negligence of the truck driver. The doctrine of proximate cause is applicable only in actions for quasi-delict, not in actions involving breach of contract. The doctrine is a device for imputing liability to a person where there is no relation between him and another party. In such a case, the obligation is created by law itself. But, where there is a pre-existing contractual relation between the parties, it is the parties themselves who create the obligation, and the function of the law is merely to regulate the relation thus created. Insofar as contracts of carriage are

concerned, some aspects regulated by the Civil Code are those respecting the diligence required of common carriers with regard to the safety of passengers as well as the presumption of negligence in cases of death or injury to passengers.

(2) This is also true of petitioner's contention that the jeepney being bumped while it was improperly parked constitutes caso fortuito. The jeepney was not properly parked, its rear portion being exposed about two meters from the broad shoulders of the highway, and facing the middle of the highway in a diagonal angle and that petitioner's driver took in more passengers than the allowed seating capacity of the jeepney. Petitioner should have foreseen the danger of parking his jeepney with its body protruding two meters into the highway.

(3) In this case, there is no legal basis for awarding moral damages since there was no factual finding by the appellate court that petitioner acted in bad faith in the performance of the contract of carriage. Sunga's contention that petitioner's admission in open court that the driver of the jeepney failed to assist her in going to a nearby hospital cannot be construed as an admission of bad faith. The fact that it was the driver of the Isuzu truck who took her to the hospital does not imply that petitioner was utterly indifferent to the plight of his injured passenger. If at all, it is merely implied recognition by Verena that he was the one at fault for the accident.

HEIRS OF THE LATE TEODORO GUARING, JR., petitioners, vs.COURT OF APPEALS, PHILIPPINE RABBIT BUS LINES, INC., and ANGELES CUEVAS, respondents. MENDOZA, J.:

G.R. No. 108395 March 7, 1997

Facts:

There was a collision between Teodoro Guaring, Jr., driving Mitsubishi Lancer while, Philippine Rabbit Bus No. 415, driven by Angeles Cuevas, and a Toyota Cressida car, driven by Eligio Enriquez. The Mitsubishi Lancer was heading north following the Philippine Rabbit Bus No. 415. On the other hand, the Toyota Cressida was cruising on the opposite lane, bound for Manila. Killed in the collision were Teodoro Guaring, Jr., who was driving the Lancer, and Dolores Enriquez, who was riding in the Cressida, while injured were Bonifacio Clemente and the occupants of the Toyota Cressida.

Petitioners, heirs of Teodoro Guaring, Jr., brought an action for damages, based on quasi delict, in the Regional Trial Court of Manila. Their evidence tended to show that the Rabbit bus tried to overtake Guaring's car and that in so doing it hit the right rear portion of Guaring as a result of which it collided with the Toyota Cressida car coming from the opposite direction. On the other hand the Private respondents, presented evidence tending to show that the accident was due to the negligence of the deceased Guaring. They claimed that it was Guaring who tried to overtake that as a result of the collision the Lancer was thrown back to its lane where it crashed into the Rabbit bus.

Regional Trial Court rendered judgment finding Philippine Rabbit Bus Lines, Inc. and its driver, Angeles Cuevas, at fault, and holding them solidarily liable for damages to petitioners. From the RTC’s judgment, private respondent Philippine Rabbit Bus Lines, Inc. appealed in the court of appeals. The appellate court held that since the basis of petitioners' action was the alleged negligence of the bus driver, the latter's acquittal in the criminal case rendered the civil case based on quasi delict untenable. Hence, this petition. Petitioners contend that:

Issue:

Whether the judgment in the criminal case extinguished the liability of private respondent Philippine Rabbit Bus Lines, Inc. and its driver, Angeles Cuevas, for damages for the death of Teodoro Guaring, Jr.

Held:

Since the appellee's civil action is predicated upon the negligence of the accused which does not exist as found by the trial court in the said criminal case, it necessarily follows that the acquittal of the accused in the criminal case carries with it the extinction of the civil responsibility arising therefrom. Otherwise stated, the fact from which the civil action might arise, the negligence of the accused, did not exist. The finding in the criminal case that accused Cuevas was not negligent and the proximate cause of the accident was the act of deceased Guaring in overtaking another vehicle ahead of him likewise it also exonerates PRB from any civil liability.

HERMANA R. CEREZO, petitioner, vs.DAVID TUAZON, respondent.

G.R. No. 141538 March 23, 2004

Facts:

Country Bus Lines passenger bus collided with a tricycle. Tricycle driver Tuazon filed a complaint for damages against Mrs. Cerezo, as owner of the bus line, her husband Attorney Juan Cerezo ("Atty. Cerezo"), and bus driver Danilo A. Foronda ("Foronda").

His complaint that the driver of the Country Bus willfully, unlawfully, and feloniously operate the said motor vehicle in a negligent, careless, and imprudent manner without due regard to traffic rules and regulations, and without taking the necessary precaution to prevent loss of lives or injuries, his negligence, carelessness and imprudence resulted to severe damage to the tricycle and serious physical injuries to plaintiff thus making him unable to walk and becoming disabled, with his thumb and middle finger on the left hand being cut.

Tuazon filed a motion to litigate as a pauper. Subsequently, the trial court issued summons against Atty. Cerezo and Mrs. Cerezo ("the Cerezo spouses"). The Cerezo spouses filed a comment with motion for bill of particulars and granted by the court. Atty. Elpidio B. Valera appeared on behalf of the Cerezo spouses. Valera filed an urgent ex-parte motion

praying for the resolution of Tuazon’s motion to litigate as a pauper and for the issuance of new summons on the Cerezo spouses to satisfy proper service in accordance with the Rules of Court. The trial court issued an order resolving Tuazon’s motion to litigate as a pauper and the Cerezo spouses’ urgent ex-parte motion. The Court is satisfied from the unrebutted testimony of the plaintiff that he is entitled to prosecute his complaint in this case as a pauper under existing rules.

Cerezo spouses filed an urgent ex-parte motion for reconsideration. The trial court denied the motion for reconsideration. The trial court issued an order directing the Cerezo spouses to file their answer within fifteen days from receipt of the order. The Cerezo spouses did not file an answer. Tuazon filed a motion to declare the Cerezo spouses in default. The trial court issued an order declaring the Cerezo spouses in default and authorizing Tuazon to present his evidence.

After considering Tuazon’s testimonial and documentary evidence, the trial court ruled in Tuazon’s favor. The trial court made no pronouncement on Foronda’s liability because there was no service of summons on him. The trial court held Mrs. Cerezo solely liable for the damages sustained by Tuazon arising from the negligence of Mrs. Cerezo’s employee, pursuant to Article 2180 of the Civil Code.

Mrs. Cerezo received a copy of the decision. She filed before the trial court a petition for relief from judgment on the grounds of "fraud, mistake or excusable negligence." Testifying before the trial court, both Mrs. Cerezo and Atty. Valera denied receipt of notices of hearings and of orders of the court. Tuazon did not testify but presented documentary evidence to prove the participation of the Cerezo spouses in the case.

The trial court issued an order denying the petition for relief from judgment. The trial court refused to grant relief from judgment because the Cerezo spouses could have availed of the remedy of appeal. The Cerezo spouses not only failed to prove fraud, accident, mistake or excusable negligence by conclusive evidence, they also failed to prove that they had a good and substantial defense. The trial court noted that the Cerezo spouses failed to appeal because they relied on an expected settlement of the case.The Cerezo spouses subsequently filed before the Court of Appeals a petition for certiorari.

The Cerezo spouses filed before this Court of appeals a petition for review on certiorari the Court rendered a resolution denying the petition for review on certiorari for failure to attach an affidavit of service of copies of the petition and failed to show that the Court of Appeals committed a reversible error. Undaunted, the Cerezo spouses filed before the Court of Appeals a petition for annulment of judgment, with prayer for restraining order. The Court of Appeals denied the petition for annulment of judgment in a resolution records show that the petitioner having availed of a petition for relief, the remedy of an annulment of judgment is no longer available.

Issues:

(1) Whether or not the case needed to be reviewed

(2) Whether or not the lower courts and the court of appeals gravely erred in rendering decision

(3) Whether or not the petitioners are liable for damages

Held:

(1) The Supreme Court held that the petition has no merit. The issues are interrelated. An examination of the records of the entire proceedings shows that It is either by sheer ignorance or by malicious manipulation of legal technicalities that they have managed to delay the disposition of the present case, to the detriment of pauper litigant Tuazon. For these reasons, the present petition should be dismissed for utter lack of merit. The issues raised in the present petition to clear any doubt about the correctness of the decision of the trial court.

(2) The lower courts and the court of appeals did not erred in rendering their decision, and was infact competent to decide the case in favor of Tuazon and against Mrs. Cerezo even in the absence of Foronda. Contrary to Mrs. Cerezo’s contention, Foronda is not an indispensable party to the present case. It is not even necessary for Tuazon to reserve the filing of a separate civil action because he opted to file a civil action for damages against Mrs. Cerezo who is primarily and directly liable for her own civil negligence. this court affirms the decision thereto.

(3) There is a modification that the amount due shall earn legal interest at 6% per annum computed from 30 May 1995, the date of the trial court’s decision.

SUPREME TRANSLINER INC., FELIPE SIA and NOVENCIO FLORES, petitioners, vs.HON. COURT OF APPEALS, GLORIA BRAZAL and minor LOTIS BRAZAL, represented by her father, NOEL BRAZAL, respondents.

G.R. No. 125356 November 21, 2001

Facts:

Felipe Sia and Supreme Transliner Inc. are the registered owners of a bus driven by co-petitioner Novencio Flores. The bus collided with a passenger jeepney carrying private respondents Gloria and Lotis Brazal. The jeepney was owned and registered in the name of Marcelino Villones and driven by Reynaldo Decena. Private respondents suffered injuries. They instituted Civil Case for damages against petitioners based on quasi-delict and against Villones and Decena for breach of contract. Petitioners, in turn, filed a third-party complaint against Country Bankers Insurance Company, insurer of the Supreme Transliner bus.

Decena and Villones testified on their own behalf and presented witnesses that the jeepney was about fifteen passengers, including private respondents Gloria and Lotis Brazal. Supreme Transliner bus coming from the opposite direction suddenly appeared on a curved portion of the road and overtook another jeepney, which it was then following. Thereafter, the bus collided with Decena's jeepney.

Petitioners presented Novencio Flores and Moises Alvarez, the Manager of Supreme Transliner. Both testified that the passenger jeepney was running very fast when the accident occurred. On the third-party complaint, petitioners showed that they already submitted the required documents for insurance claim and that Country Bankers Insurance Company promised to settle the claim, but did not.

Trial court rendered its judgment, finding that the plaintiffs [have] established by preponderance of evidence the allegations of the complaint. Declared that Flores was negligent in operating the bus while, Sia failed to exercise the diligence of a good father of a family in the choice, supervision and direction of his employees.

On the third-party complaint, the trial court found that Supreme Transliner had insured the bus with Country Bankers, paid the premiums for the period covering the accident, and made an insurance claim by notifying the insurer and submitting the required documents. However, until the filing of the complaint, Country Bankers had not acted upon Supreme Transliner's claim. The trial court ordered Country Bankers to pay third-party plaintiffs an amount not exceeding P50,000.

Petitioners appealed to the Court of Appeals. The appealed Affirmed with the RTC. Petitioners filed a motion for reconsideration but this was denied. Hence, this petition, where petitioners raise the following:

Issues:

(1) Who has the burden of proving herein petitioners' liability?

(2) May the evidence presented by Decena and Villones be considered in determining preponderance of evidence against herein petitioners?

Held:

(1) The party, whether plaintiff or defendant, who asserts the affirmative of the issue has the burden of proof to obtain a favorable judgment. For the defendant, an affirmative defense is one which is not a denial of an essential ingredient in the plaintiffs cause of action, but one which, if established, will be a good defense both private respondents as well as the jeepney driver Reynaldo Decena and its owner Marcelino Villones claim that the bus driver, Novencio Flores, was liable for negligently operating the bus. For private respondents, the claim constitutes their cause of action against petitioners which said private respondents must prove by preponderance of evidence. At the same time, the same claim is a matter of affirmative defense on the part of Decena and Villones who are impleaded as co-defendants of petitioners. Therefore, both private respondents as well as the said co-defendants had the burden of proving petitioners' negligence by the quantum of proof required to establish the latter's liability, by preponderance of evidence.

(2) The court rule in affirmative. The evidence presented by the jeepney owner and its driver, Villones and Decena, forms part of the totality of the evidence concerning the negligence committed by petitioners as defendants in quasi-delict case. Preponderance of evidence is determined by considering all the facts and circumstances of the case, culled from the evidence, regardless of who actually presented it. Petitioners' liability were proved by the evidence presented by Decena and Villones at the trial, taken together with the evidence presented by the victims of the collision, namely herein private respondents Gloria and Lotis Brazal.

GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS), petitioner, vs.COURT OF APPEALS (former Tenth Division), VICTORIA JAIME VDA. DE KHO, for herself and minor ROY ROLAND, GLORIA KHO VDA. DE CALABIA for herself and minors MARY GRACE, WILLIE, JR., VOLTAIRE, GLENN, and MAY, all surnamed CALABIA, DANIEL KHO, JOSEFINA KHO, EMERITA KHO APEGO, ANTONIO KHO and TERESITA KHO, respondents.

G.R. No. 101439 June 21, 1999

Facts:

National Food Authority (NFA, formerly National Grains Authority) was the owner of a Chevrolet truck which was insured against liabilities for death of and injuries to third persons with the GSIS. The said truck driven by Guillermo Corbeta collided with a public utility vehicle, a Toyota Tamaraw. The Toyota Tamaraw was owned and operated by Victor Uy, under the name and style of "Victory Line." The Tamaraw was a total wreck. All the collision victims were passengers of the Toyota Tamaraw. Three (3) cases were filed with the Court of First Instance of Agusan del Norte and Butuan City.

The first, Civil Case for quasi-delict, damages and attorney's fees, was commenced by Uy and against NFA and Corbeta. The second, for damages, was filed by an injured passenger, Librado Taer, against Uy, the operator of the public utility vehicle, and insurer, Mabuhay Insurance and Guaranty Co. (MIGC). In turn, Uy filed a cross-claim against MIGC and a third-party complaint against Corbeta and NFA. The third, Civil Case was instituted by herein private respondents against the following: NFA and Corbeta for damages due to quasi-delict; GSIS as insurer of the truck; Uy for breach of contract of carriage; and MIGC as insurer of the Toyota Tamaraw.

These cases were consolidated and partially tried by Judge Fortunate A. Vailoces, of the then Court of First Instance of Agusan del Norte and Butuan City.

These cases were transferred to the Regional Trial Court. RTC’s decision holding that Corbeta's negligence was the proximate cause of the collision. Concluded, if both vehicles had traveled in their respective lanes, the incident would not have been occurred. However, the Chevy cargo truck had crossed over to the other lane which, under traffic rules, was the lane of the Toyota Tamaraw. Corbeta and NFA appealed the decision of the trial court to the Court of Appeals. GSIS also elevated the decision to the same appellate court. The Court of Appeals agreed with the conclusions of the trial court and finding no reversible error, the decisions of the Court a quo are AFFIRMED in toto, with costs against the appellants.

GSIS and NFA filed their motions for reconsideration respectively, which were denied by the respondent court in its Resolution, only GSIS filed this petition for review on certiorari.

Issue:

Whether the respondent court erred in holding GSIS solidarily liable with the negligent insured/owner-operator of the Chevrolet truck for damages awarded to private respondents which are beyond the limitations of the insurance policy.

Held:

The Supreme Court GRANTED the petition in this case the records reveal that, the private respondents sent a notice of loss to the petitioner informing the latter of the accident. The notice constitutes evidence of the loss they suffered by reason of the vehicular collision. the defense of laches or prescription is deemed waived because of petitioner's failure to raise it not only before but also during the hearing. (GSIS) was impleaded as insurer of NFA. But under the CMVLI law, the petitioner could only be held liable under its contract of insurance. And pursuant to the CMVLI law, its liability is primary, and not dependent on the recovery of judgment from the insured. Hence, GSIS is directly liable to the private respondents, the Petitioner is ordered to pay the death indemnity to each group of heirs of the deceased, and for medical expenses of Victoria Jaime Vda. de Kho; and Gloria Kho Vda. de Calabia.

While Guillermo Corbeta, National Foods Authority, and Mabuhay Insurance & Guaranty Co., Inc., jointly and severally, are ordered to pay private respondents' claims minus the amounts that GSIS must pay to the injured victims and the heirs of the deceased victims.

Norma Mangalig and Narciso Solano petitioners,

Versus-

Hon. Edelwina Catubig-Pastoral, Judge of the Regional Trial Court, 1st Judicial Region, San Carlos City, Pangasinan, branch 56 and Apolinario Serquina, Jr., respondents.

G.R. No. 143951 October 25, 2005

Facts:

Apolinario Serquina, Jr. filed before the RTC a complaint for damages against petitioners Norma Mangaliag and Narciso Solano. The complaint alleges that due to the gross negligence, carelessness and imprudence of petitioner Solano in driving the truck, private respondent and his co-passengers sustained serious injuries and permanent deformities; when a dump truck owned by petitioner Mangaliag and driven by her employee, petitioner Solano, coming from the opposite direction, tried to overtake and bypass a tricycle in front of it and thereby encroached the left lane and sideswiped the tricycle ridden by private respondent.

Petitioners filed their answer with counterclaim denying that private respondent has a cause of action against them. They attributed fault or negligence in the vehicular accident on the tricycle driver, Jayson Laforte, who was allegedly driving without license. Petitioners filed a motion to dismiss on the ground of lack of jurisdiction over the subject matter of the claim, alleging that the Municipal Trial Court (MTC) has jurisdiction over the case since the principal amount prayed falls within its jurisdiction.

Petitioners filed a motion for reconsideration but it was denied by the respondent RTC Judge. Hence, they appeal for petition for certiorari, with prayer for the issuance of a temporary restraining order. The RTC resolved to issue the temporary restraining order prayed for by petitioners. Consequently, the respondent RTC Judge desisted from hearing further the Civil Case.

Issue:

Whether or not the petition for certiorari with a prayer for the issuance of a temporary restraining order, set asides the Order of the Regional Trial Court (RTC) of the action for damages.

Held:

The Supreme Court held that the instant petition for certiorari is DISMISSED for lack of merit. The judicial hierarchy of courts is not an iron-clad rule. It generally applies to cases involving warring factual allegations. For this reason, litigants are required to repair to the trial courts at the first instance to determine the truth or falsity of these contending allegations on the basis of the evidence of the parties. Cases which depend on disputed facts for decision cannot be brought immediately before appellate courts as they are not triers of facts. the court’s jurisdiction in a case of quasi-delict causing physical injuries would only be based on the claim for actual damages and the complaint is filed in the MTC, it can only award moral damages in an amount within its jurisdictional limitations, a situation not intended by the framers of the law. The Regional Trial Court, is DIRECTED to continue with the trial proceedings in Civil Case and resolve the case with dispatch.

VICTOR ORQUILA & HONORATA ORQUIOLAVSCOURT OF APPEALS, ETC.

G.R. No. 141463 August 6, 2002

Facts:

Petitioner spouse purchased the subject land in 1964 from Mariano Lising. The spouse acquired the land in question without knowledge of any defect in the title of Lising. Shortly afterwards, they built their conjugal home on said land.

It was only in 1998, when the sheriff of Quezon City tried to execute the judgment in Civil Case Q-12918, that they had notice to private respondent’s adverse claim.

Issue:

Can the institution of Civil case serve as notice of such adverse claim to petitioners?

Held:

No, it cannot since petitioner-spouses were not impleded therein as parties. As bilders in good faith and innocent purchases for value, petitioners have rights over the subject property and, hence are proper parties in interest in any case thereon. Consequently, private respondents should have impleaded them in Civil Case Q-12918.

Since they failed to do so, petitioners cannot be reached by the decision in said case. No man shall be affected by any proceeding to which he is a stranger, and strangers to a case are not bound by any judgment rendered by the court.

THE CONSOLIDATED BANK and TRUST CORPORATION, petitioner, vs. COURT OF APPEALS and L.C. DIAZ and COMPANY, CPA’s, respondents.

G.R. No. 138569. September 11, 2003

Facts:

L.C. Diaz opened a savings account with Solidbank, through its cashier, Mercedes Macaraya. Macaraya instructed the messenger of L.C. Diaz, Ismael Calapre (“Calapre”), to deposit the money with Solidbank. Macaraya also gave Calapre the Solidbank passbook. Macaraya, together with Calapre, went to Solidbank and presented to Teller No. 6 the deposit slip and check. When Macaraya asked for the passbook, teller told that someone got the passbook but she could not remember to whom she gave the passbook. When Macaraya asked Teller No. 6 if Calapre got the passbook, Teller No. 6 answered that someone shorter than Calapre got the passbook.

L.C. Diaz through its Chief Executive Officer, Luis C. Diaz (“Diaz”), called up Solidbank to stop any transaction using the same passbook until he could open a new account. On the same day that L.C. Diaz learned of the unauthorized withdrawal the day before, The withdrawal slip bore the signatures of the authorized signatories of L.C. Diaz, namely Diaz and Rustico L. Murillo. The signatories, however, denied signing the withdrawal slip. A certain Noel Tamayo received the P300,000.

In an Information L.C. Diaz charged its messenger, Emerano Ilagan (“Ilagan”) and one Roscon Verdazola with Estafa through Falsification of Commercial Document. The Regional Trial Court dismissed the criminal case after the City Prosecutor filed a Motion to Dismiss. L.C. Diaz through its counsel demanded from Solidbank the return of its money. Solidbank refused. L.C. Diaz filed a Complaint for Recovery of a Sum of Money against Solidbank with the Regional Trial Court. The trial court rendered a decision absolving Solidbank and dismissing the complaint. L.C. Diaz then appealed to the Court of Appeals. Court of Appeals issued its Decision reversing the decision of the trial court.

On the other hand Court of Appeals issued its Resolution denying the motion for reconsideration of Solidbank. The appellate court, however, modified its decision by deleting the award of exemplary damages and attorney’s fees. Solidbank seeks the review of the decision and resolution of the Court of Appeals

Issues:

(1) THE COURT OF APPEALS ERRED IN HOLDING THAT PETITIONER BANK SHOULD SUFFER THE LOSS FOR ALLOWING THE WITHDRAWAL OF P300,000.00 TO RESPONDENT’S MESSENGER EMERANO ILAGAN.

(2) THE COURT OF APPEALS ERRED IN NOT MITIGATING THE DAMAGES AWARDED AGAINST PETITIONER UNDER ARTICLE 2197 OF THE CIVIL CODE, NOTWITHSTANDING ITS FINDING THAT PETITIONER BANK’S NEGLIGENCE WAS ONLY CONTRIBUTORY.

Held:

(1) The Supreme Court AFFIRMED the decision of the Court of Appeals L.C. Diaz was not at fault that the passbook landed in the hands of the impostor. Solidbank was in possession of the passbook while it was processing the deposit. After completion of the transaction, Solidbank had the contractual obligation to return the passbook only to Calapre, the authorized representative of L.C. Diaz. Solidbank failed to fulfill its contractual obligation because it gave the passbook to another person.

(2) In this case, L.C. Diaz was guilty of contributory negligence in allowing a withdrawal slip signed by its authorized signatories to fall into the hands of an impostor. Thus, the liability of Solidbank should be reduced. L.C. Diaz must shoulder 40% of the actual damages awarded by the appellate court. Solidbank must pay the other 60% of the actual damages.

SPOUSES MARCELO B. ARENAS and ANITA T. ARENAS, petitioners, vs. THE HON. COURT OF APPEALS, SPOUSES CONRADO S. ROJAS AND ROSALINA BAUZON ROJAS, respondents.

G.R. No. 126640. November 23, 2000

Facts:

Rosalina B. Rojas was the co-owner of a two-story building located in Calasiao, Pangasinan. Rojas entered into a verbal contract of lease with petitioner Marcelo B. Arenas over one stall located at the ground floor of the building, on a month to month basis. Petitioner Arenas used the leased premises as an optical clinic. Rojas wanted to demolish and reconstruct the building and terminated her lease contract with petitioner Arenas. Respondents sent petitioners a notice of termination and a demand to vacate the premises However, petitioners refused to vacate the premises. Rojas filed a complaint for “Unlawful Detainer and Damages” against petitioner Arenas. Arenas filed his answer to the complaint and counterclaim for moral damages, exemplary damages and attorney’s fees, stating that the case was maliciously filed. Municipal Trial Court decided against petitioner. Arenas appealed to the Regional Trial Court. Regional Trial Court denied the appeal and affirmed the decision of the Municipal Trial Court in toto.

Regional Trial Court issued a temporary restraining order enjoining the Municipal Trial Court, from hearing Civil Case. The temporary restraining order also directed respondents to cease and desist from “committing acts of disturbances” respondents moved the trial court to dismiss the case. Trial court denied the motion to dismiss for lack of merit. Respondents filed with the trial court their answer to the complaint with counterclaim, reiterating their motion to dismiss with an alternative motion to suspend the proceedings. The trial court issued a resolution stating that it had jurisdiction to hear, try and decide Civil Case The trial court decided the case in favor of petitioners.

Respondents appealed to the Court of Appeals. The Court of Appeals rendered its decision reversing that of the trial court and dismissing petitioner’s complaint. The Court of

Appeals reasoned that since petitioners interposed a counterclaim for moral and exemplary damages they were barred from instituting Civil Case. Hence this petition.

Issues:

(1) Whether the causes of action complained of in the Regional Trial Court were in the nature of compulsory counterclaims that must be pleaded in Civil Case of the Municipal Trial Court.

(2) Whether or not that the acts complained of in Civil Case No. 16890 arose after the filing of the complaint and the answer in Civil Case No. 658. Thus, damages arising from such acts could not be raised therein as compulsory counterclaims.

Held:

(1) The appeal is meritorious the court agree with petitioners that the causes of action pleaded the trial court erred in for touching on the propriety of the ejectment case which was settled and affirmed on appeal We agree with petitioners that the acts complained of were not founded on the contract of lease but could constitute violations of the Civil Code provisions on Human Relations, of articles 19-21 of civil code. The fact that the rule on summary procedure governs ejectment cases emphasizes the point that an action for damages incapable of pecuniary estimation can not be pleaded as counterclaims therein. It cannot be overemphasized that the reason for the rule on summary procedure is to prevent undue delays in the disposition of cases. To achieve this, the filing of certain pleadings is prohibited and the periods for acting on motions as well as on the case itself are relatively reduced.

(1) In lieu thereof, the Court renders judgment setting aside the decision of the Regional Trial Court, Pangasinan, Branch 39, Lingayen, in Civil Case No. 16890, and REMANDING the case to the court of origin with instructions that the court shall hear the case with all deliberate dispatch, limiting itself to the determination of whether the acts committed by respondents constitute quasi-delict, entitling petitioners to the damages prayed for. The trial court shall report to the Court the progress of the case on a month to month basis.

SAN ILDEFONSO LINES, INC., and EDUARDO JAVIER, petitioners, vs.COURT OF APPEALS (Thirteenth Division) and PIONEER INSURANCE and SURETY CORPORATION, respondents.

G.R. No. 119771 April 24, 1998

Facts:

Annie U. Jao drove the Toyota lite ace van and a passenger bus of herein petitioner San Ildefonso Lines, Inc. (hereafter, SILI) figured in a vehicular mishap. A criminal case was thereafter filed with the Regional Trial Court charging the driver of the bus, herein petitioner

Eduardo Javier, with reckless imprudence resulting in damage to property with multiple physical injuries.

Private respondent Pioneer Insurance and Surety Corporation (PISC), as insurer of the van and subrogee, filed a case for damages against petitioner SILI with the Regional Trial Court of Manila, seeking to recover the sums it paid the assured under a motor vehicle insurance policy as well as other damages.

Petitioners filed a Manifestation and Motion to Suspend Civil Proceedings grounded on the pendency of the criminal case against petitioner Javier in the Pasig RTC and the failure of respondent PISC to make a reservation to file a separate damage suit in said criminal action. This was denied by the Manila Regional Trial Court

After their motion for reconsideration the Order was denied, petitioners elevated the matter to this Court via petition for certiorari which was, however, referred to public respondent Court of Appeals for disposition. A decision adverse to petitioners once again was rendered by respondent court, upholding the assailed Manila Regional Trial Court Order. Hence, this petition for review after a motion for reconsideration was denied.

Issue:

If a criminal case was filed, can an independent civil action based on quasi-delict under Article 2176 of the Civil Code be filed if no reservation was made in the said criminal case?

Held:

On the chief issue of "reservation", There is no dispute that these so-called "independent civil actions" are the exceptions to the primacy of the criminal action over the civil action. There is no dispute that these so-called "independent civil actions" based on the aforementioned Civil Code articles are the exceptions to the primacy of the criminal action over the civil action Although the separate civil action filed in this case was without previous reservation in the criminal case, nevertheless since it was instituted before the prosecution presented evidence in the criminal action, and the judge handling the criminal case was informed thereof, then the actual filing of the civil action is even far better than a compliance with the requirement of an express reservation that should be made by the offended party before the prosecution presents its evidence.

The Supreme Court assailed with the decision of the Court of Appeals. Clearly then, private respondent PISC, as subrogee is not exempt from the reservation requirement with respect to its damages suit based on quasi-delict arising from the same act or ommission of petitioner Javier complained of in the criminal case. As private respondent PISC merely stepped into the shoes of Ms. Jao (as owner of the insured Toyota van), then it is bound to observe the procedural requirements which Ms. Jao ought to follow had she herself instituted the civil case.

PHILTRANCO SERVICE ENTERPRISES, INC. and ROGACIONES MANILHIG, petitioner, vs.COURT OF APPEALS and HEIRS OF THE LATE RAMON ACUESTA, respondents.DAVIDE, JR., J.:

G.R. No. 120553 June 17, 1997

Facts:

The private respondents alleged that the petitioners were guilty of gross negligence, recklessness, violation of traffic rules and regulations, abandonment of victim, and attempt to escape from a crime. To support their allegations, the private respondents presented eight witnesses. Petitioners filed an Answer wherein they alleged that petitioner Philtranco exercised the diligence of a good father of a family in the selection and supervision of its employees, including petitioner Manilhig who had excellent record as a driver and had undergone months of rigid training before he was hired.

The petitioners further claimed that it was the negligence of the victim in overtaking two tricycles, without taking precautions such as seeing first that the road was clear, which caused the death of the victim. The latter did not even give any signal of his intention to overtake. The petitioners were not able to present their evidence, as they were deemed to have waived that right by the failure of their counsel to appear at the scheduled hearings. The trial court then issued an Order declaring the case submitted for decision. Motions for the reconsideration of the said Order were both denied. The trial court handed down a decision ordering the petitioners to jointly and severally pay the private respondents.

The petitioners interposed this appeal by way of a petition for review the Decision of the Court of Appeals that affirming the Decision of the Regional Trial Court, which ordered the petitioners to pay the private respondents damages as a result of a vehicular accident.

Issues:

(1) IN APPLYING ART. 2194, INSTEAD OF ART. 2180, OF THE CIVIL CODE, AND IN HOLDING THAT PETITIONER PHILTRANCO CAN NOT INVOKE THE DEFENSE OF DILIGENCE OF A GOOD FATHER OF A FAMILY.

(2) IN AWARDING DAMAGES TO RESPONDENTS AND/OR IN NOT FINDING THE TRIAL COURT'S AWARD OF DAMAGES EXCESSIVE.

Held:

(1) The Supreme Court have consistently held that the liability of the registered owner of a public service vehicle, like petitioner Philtranco, for damages arising from the tortious acts of the driver is primary, direct, and joint and several or solidary with the driver. As to solidarity, Article 2194 expressly provides. Since the employer's liability is primary, direct and solidary, its only recourse if the judgment for damages is satisfied by it is to recover what it has paid from its employee who committed the fault or negligence which gave rise to the action based on quasi-delict. Article 2181 of the Civil Code.

(2) The trial court erroneously fixed the "death indemnity. We concur with petitioners' view that the trial court intended the award of "P200,000.00 as death indemnity" not as compensation for loss of earning capacity. Even if the trial court intended the award as

indemnity for loss of earning capacity, the same must be struck out for lack of basis. There is no evidence on the victim's earning capacity and life expectancy.

RUBEN MANIAGO, petitioner, vs.THE COURT OF APPEALS (First Division) HON. RUBEN C. AYSON, in his capacity as Acting Presiding Judge, Regional Trial Court, Branch IV, Baguio City, and ALFREDO BOADO, respondents.

G.R. No. 104392 February 20, 1996

Facts:

Alfredo Boado owned a passenger jeepney that has figured in a vehicular accident by a bus, his driver Herminio Andaya was charged with a criminal case for reckless imprudence resulting in damage to property and multiple physical injuries. A civil case for damages was filed by private respondent Boado against petitioner. The complaint was assigned to the same court. Petitioner moved for the suspension of the proceedings in the civil case against him, citing the pendency of the criminal case against his driver. But the trial court, denied petitioner's motion on the ground that pursuant to the Civil Code, the action could proceed independently of the criminal action, in addition to the fact that the petitioner was not the accused in the criminal case.

Petitioner took the matter on certiorari and prohibition to the Court of Appeals, the Court of Appeals dismissed his petition. Hence this petition for review on certiorari.

Issue:

Whether despite the absence of such reservation, private respondent may nonetheless bring an action for damages against petitioner under the provisions of article 1276 & 1280.

Held:

Based on these provisions, petitioner argues that the civil action against him was impliedly instituted in the criminal action previously filed against his employee because private respondent did not reserve his right to bring this action separately. In the present case, the criminal action was filed against the employee, bus driver. Had the driver been convicted and found insolvent, his employer would have been held subsidiarily liable for damages. But if the right to bring a separate civil action (whether arising from the crime or from quasi delict) is reserved, there would be no possibility that the employer would be held liable because in such a case there would be no pronouncement as to the civil liability of the accused. In such a case the institution of a separate and independent civil action under the Civil Code would not result in the employee being held liable for the same act or omission. That the action is against the employer to enforce his vicarious liability under Art. 2180 of the Civil Code. Though not an accused in the criminal case, the employer is very much a party, as long as the right to bring or institute a separate action (whether arising from crime or from quasi delict) is not reserved.

RAYMUNDO ODANI SECOSA, EL BUENASENSO SY and DASSAD WAREHOUSING and PORT SERVICES, INCORPORATED, petitioners, vs. HEIRS OF ERWIN SUAREZ FRANCISCO, respondents.

G.R. No. 160039. June 29, 2004

Facts:

Erwin Suarez Francisco, a student of the Manila Central University, was riding a motorcycle. At the same time, petitioner, Raymundo Odani Secosa, was driving an Isuzu cargo truck it was owned by petitioner, Dassad Warehousing and Port Services, Inc. Traveling behind the motorcycle driven by Francisco was a sand and gravel truck, which in turn was being tailed by the Isuzu truck driven by Secosa.

When Secosa overtook the sand and gravel truck, he bumped the motorcycle causing Francisco to fall. The rear wheels of the Isuzu truck then ran over Francisco, which resulted in his instantaneous death. Fearing for his life, petitioner Secosa left his truck and fled the scene of the collision.

Respondents, the parents of Erwin Francisco, filed an action for damages against Raymond Odani Secosa, Dassad Warehousing and Port Services, Inc. and Dassad’s president, El Buenasucenso Sy. The complaint was docketed as Civil case of the RTC the court a quo rendered a decision in favor of herein respondents.

Petitioners appealed the decision to the Court of Appeals, which affirmed the appealed decision in toto.

Issue:

Whether petitioner Dassad Warehousing and Port Services, Inc. exercised the diligence of a good father of a family in the selection and supervision of its employees, we find the assailed decision to be in full accord with pertinent provisions of law and established jurisprudence.

Held:

Article 2176 of the Civil Code provides: Whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no pre-existing contractual relation between the parties, is called a quasi-delict and in Article 2180, in pertinent part, states:The obligation imposed by article 2176 is demandable not only for one’s own acts or omissions, but also for those of persons for whom one is responsible. Employers shall be liable for the damages caused by their employees and household helpers acting within the scope of their assigned tasks, even though the former are not engaged in any business or industry. Thus, the petition is DENIED. The assailed decision is AFFIRMED Dassas Warehousing and Port Services, Inc. exercised the diligence of a good father of a family in the selection and supervision of its employees, we find the assailed decision to be in full accord with pertinent provisions of law and established jurisprudence.

AMERICAN EXPRESS INTERNATIONAL, INC., VersusNOEL CORDERO

G.R. No. 138550 October 14, 2005

Facts:

American Express International was a foreign corporation that issues charge cards use to purchase goods and services at accredited merchants worldwide to its customers. Nilda Cordero, wife of respondent Noel Cordero, was issued an American Express charge card. An extension charge card, was likewise issued to respondent Noel Cordero which he also signed.Respondent, together with his family went on a three-day holiday trip to Hong Kong. The group went to the Watson’s Chemist Shop Noel picked up some chocolate candies and handed to the sales clerk his American Express extension charge card to pay for his purchases. Susan Chong, the store manager, informed respondent that she had to confiscate the card. Thereupon, she cut respondent’s American Express card in half with a pair of scissors. This, according to respondent, caused him embarrassment and humiliation. Hence, Nilda had to pay for the purchases using her own American Express charge card.

The card is placed in the “Inspect Airwarn Support System.” Once a card suspected of unauthorized use is placed in the system, the person to whom the card is tendered must verify the identity of the holder. If the true identity of the card owner is established, the card is honored and the charges are approved. Otherwise, the card is revoked or confiscated.

Respondent filed with the RTC, a complaint for damages against petitioner, docketed as Civil Case. He prayed for the award of moral damages and exemplary damages, as well as attorney’s fees as a result of the humiliation he suffered. The trial court found that “the inexcusable failure of defendant (petitioner herein) to inform plaintiff (respondent herein) of the incident despite sufficient time was the proximate cause of the confiscation and cutting of plaintiff’s extension card which exposed the latter to public humiliation for which defendant should be held liable.”

Upon appeal, the Court of Appeals rendered the assailed Decision affirming the trial court’s Decision with modification in the sense that the amounts of damages awarded were reduced

Hence, the instant petition is raise.

Issues:

Whether the lower courts gravely erred in holding for moral damages, exemplary damages and attorney’s fees

Held:

Petitioner can revoke respondent’s card without notice, as was done. It bears reiterating that the subject card would not have been confiscated and cut had respondent talked to petitioner’s representative and identified himself as the genuine cardholder. It is thus safe to conclude that there was no negligence on the part of petitioner and that, therefore, it cannot be held liable to respondent for damages.