Paz Fores, Petitioner v. Ireneo Miranda, Respondent GR no. L-12163 March 4, 1959 Reyes, J.B.L., J.

Miranda was one ofhte passengers on a jeepney driven by Eugenio Luga. While the jeep was descending Sta. Mesa bridge at an excesisve speed, the driver lost control causing it to swerve and hit the bridge wall. Five of the passengers were injured, including Miranda who suffered a fracture of the upper right humerus. He wa subject to a series of operations yet at the time of the trial, he has notyet recovered the use of his right arm.

Luga was charged with serious physicial injuries through reckless imprudence, and upon interposing a plea of guilty, was sentenced accordingly.

It was alleged that the evidence failed to identify the vehicle but this was rejected by the appellate court which found that the jeep carried the plate no. TPU 1163, series of 1952 and registered in the name of Paz Forez and that the vehicle had the name of Dona Paz painted below the windshield. There was no evidence presented to prove the contrary.

Fores also said that she allegedly sold the jeep involved to a Carmen Sackerman.

ISSUE/s: 1.Is the approval of the Public Service Commission necessary for the sale of a public service vehicle even without conveying therewith the authority to operate the same? YES 2. WON moral damages may be awarded. NO.

1. The CA answered YES to this question. Under Sec. 20 of the Public Service Act it was unlawful for the owner, lessee or operator to sell, alienate, mortgage, encumber or lease its property among others without the previous approval and authority of the Commission. The transfer without the authority of the PSC is not effective and binding in so far as the respnsibility of the grantee under the franchise in relation to the public is concerned.

Fores assails this arguing that the in the rulings being applied, the operator did not convey by lease or by sale, the vehicle independently of his rights under the franchise. SC no basis. The prohibition is clear, it was meant to protect the public interest. Until the approval is obtained, in contemplation of law, the vehicle is still under the service of the owner of operator standing in the records of the Commission which the public has to rely on

the sale between the parties is still valid.

2. the P2,000 (reduced from P10,000) and the P3,000 as atty's fees were valid awards of actual damages. As for the moral damages, it must discarded. Moral damages are not recoverable in damage actions rediccted on a breach of the contract of transportation (art. 2219 and 2220 of the NCC). Thus, in case of breach of contract proof of bad faith or fraud is essential to justify an award of moral damages and that a brech of contract cannot be considered included in the descriptive term analogous cases in Art. 2219. Art. 2176 excludes cases where there is a preexisting contractual relation between the parties. The only exception is where death results from the accident. In this case, Art. 2206 provides that the deceased may demand moral damages for mental anguis by reason of the death of the deceased