G.R. No. L-24803 May 26, 1977 PEDRO ELCANO and PATRICIA ELCANO, n !"# $ %a&a% !y a' A'%#ndan!

' o( A)a& !o E*%ano, d#%#a'#d,plaintiffs-appellants, vs. REGINALD +ILL, , no$, and MAR-IN +ILL, a' (a!"#$ and Na!.$a* G.a$d an o( 'a d , no$, defendantsappellees. Appeal from the order of the Court of First Instance of Quezon City dated January 29, 9!" in Civil Case #o. Q-$ %2, &edro 'lcano et al. vs. (e)inald *ill et al. dismissin), upon motion to dismiss of defendants, the complaint of plaintiffs for recovery of dama)es from defendant (e)inald *ill, a minor, married at the time of the occurrence, and his father, the defendant +arvin *ill, ,ith ,hom he ,as livin) and )ettin) su-sistence, for the .illin) -y (e)inald of the son of the plaintiffs, named A)apito 'lcano, of ,hich, ,hen criminally prosecuted, the said accused ,as ac/uitted on the )round that his act ,as not criminal, -ecause of 0lac. of intent to .ill, coupled ,ith mista.e.0 Actually, the motion to dismiss -ased on the follo,in) )rounds1 . 2he present action is not only a)ainst -ut a violation of section , (ule %3, ,hich is no, (ule III, of the (evised (ules of Court4 2. 2he action is -arred -y a prior 5ud)ment ,hich is no, final and or in res-adjudicata4 6. 2he complaint had no cause of action a)ainst defendant +arvin *ill, -ecause he ,as relieved as )uardian of the other defendant throu)h emancipation -y marria)e. 7&. 26, (ecord 8p. 9, (ecord on Appeal.:; ,as first denied -y the trial court. It ,as only upon motion for reconsideration of the defendants of such denial, reiteratin) the a-ove )rounds that the follo,in) order ,as issued1 Considerin) the motion for reconsideration filed -y the defendants on January 9, 9!" and after thorou)hly e<aminin) the ar)uments therein contained, the Court finds the same to -e meritorious and ,ell-founded. =*'('F>(', the >rder of this Court on ?ecem-er $, 9!9 is here-y reconsidered -y orderin) the dismissal of the a-ove entitled case. @> >(?'('?. Quezon City, &hilippines, January 29, 9!". 7p. 9%, (ecord 8p. 2 , (ecord on Appeal.; *ence, this appeal ,here plaintiffs-appellants, the spouses 'lcano, are presentin) for >ur resolution the follo,in) assi)nment of errors1 2*' A>='( C>B(2 '(('? I# ?I@+I@@I#C 2*' CA@' DE B&*>A?I#C 2*' CAAI+ >F ?'F'#?A#2@ 2*A2 I 2*' &('@'#2 AC2I># I@ #>2 >#AE ACAI#@2 DB2 AA@> A FI>AA2I># >F @'C2I># , (BA' %3, #>= (BA' , >F 2*' ('FI@'? (BA'@ >F C>B(2, A#? 2*A2 @'C2I># 67c; >F (BA' , (BA'@ >F C>B(2 I@ A&&AICADA'4 II 2*' AC2I># I@ DA(('? DE A &(I>( JB?C+'#2 =*IC* I@ #>= FI#AA >( ('@A?JB?IC2A4 III 2*' &(I#CI&A'@ >F QBA@I-?'AIC2@, A(2ICA'@ 2 3! 2> 2 99 >F 2*' CIFIA C>?', A(' I#A&&AICADA' I# 2*' I#@2A#2 CA@'4 and IF

2*A2 2*' C>+&AAI#2 @2A2'@ #> CAB@' >F AC2I># ACAI#@2 ?'F'#?A#2 +A(FI# *IAA D'CAB@' *' =A@ ('AI'F'? A@ CBA(?IA# >F 2*' >2*'( ?'F'#?A#2 2*(>BC* '+A#CI&A2I># DE +A((IAC'. 7pa)e 9, (ecord.; It appears that for the .illin) of the son, A)apito, of plaintiffs-appellants, defendant- appellee (e)inald *ill ,as prosecuted criminally in Criminal Case #o. " %2 of the Court of First Instance of Quezon City. After due trial, he ,as ac/uitted on the )round that his act ,as not criminal -ecause of 0lac. of intent to .ill, coupled ,ith mista.e.0 &arenthetically, none of the parties has favored Bs ,ith a copy of the decision of ac/uittal, presuma-ly -ecause appellants do not dispute that such indeed ,as the -asis stated in the courtGs decision. And so, ,hen appellants filed their complaint a)ainst appellees (e)inald and his father, Atty. +arvin *ill, on account of the death of their son, the appellees filed the motion to dismiss a-ove-referred to. As =e vie, the fore)oin) -ac.)round of this case, the t,o decisive issues presented for >ur resolution are1 . Is the present civil action for dama)es -arred -y the ac/uittal of (e)inald in the criminal case ,herein the action for civil lia-ility, ,as not reversedH 2. +ay Article 2 $% 72nd and last para)raphs; of the Civil Code he applied a)ainst Atty. *ill, not,ithstandin) the undisputed fact that at the time of the occurrence complained of. (e)inald, thou)h a minor, livin) ,ith and )ettin) su-sistenee from his father, ,as already le)ally marriedH 2he first issue presents no more pro-lem than the need for a reiteration and further clarification of the dual character, criminal and civil, of fault or ne)li)ence as a source of o-li)ation ,hich ,as firmly esta-lished in this 5urisdiction in Barredo vs. Garcia, 36 &hil. !%3. In that case, this Court postulated, on the -asis of a scholarly dissertation -y Justice Doco-o on the nature of culpa aquiliana in relation to culpa criminal or delito and mereculpa or fault, ,ith pertinent citation of decisions of the @upreme Court of @pain, the ,or.s of reco)nized civilians, and earlier 5urisprudence of our o,n, that the same )iven act can result in civil lia-ility not only under the &enal Code -ut also under the Civil Code. 2hus, the opinion holds1 2he, a-ove case is pertinent -ecause it sho,s that the same act machinist. come under -oth the &enal Code and the Civil Code. In that case, the action of the a)ent .illeth un5ustified and fraudulent and therefore could have -een the su-5ect of a criminal action. And yet, it ,as held to -e also a proper su-5ect of a civil action under article 9%2 of the Civil Code. It is also to -e noted that it ,as the employer and not the employee ,ho ,as -ein) sued. 7pp. ! "-! !, 36 &hil.;. 1 It ,ill -e noticed that the defendant in the a-ove case could have -een prosecuted in a criminal case -ecause his ne)li)ence causin) the death of the child ,as punisha-le -y the &enal Code. *ere is therefore a clear instance of the same act of ne)li)ence -ein) a proper su-5ect matter either of a criminal action ,ith its conse/uent civil lia-ility arisin) from a crime or of an entirely separate and independent civil action for fault or ne)li)ence under article 9%2 of the Civil Code. 2hus, in this 5urisdiction, the separate individuality of a cuasi-delito or culpa aquiliana, under the Civil Code has -een fully and clearly reco)nized, even ,ith re)ard to a ne)li)ent act for ,hich the ,ron)doer could have -een prosecuted and convicted in a criminal case and for ,hich, after such a conviction, he could have -een sued for this civil lia-ility arisin) from his crime. 7p. ! 3, 36 &hil.; 2 It is most si)nificant that in the case 5ust cited, this Court specifically applied article 9%2 of the Civil Code. It is thus that althou)h J. F. *ouse could have -een criminally prosecuted for rec.less or simple ne)li)ence and not only punished -ut also made civilly lia-le -ecause of his criminal ne)li)ence, nevertheless this Court a,arded dama)es in an independent civil action for fault or ne)li)ence under article 9%2 of the Civil Code. 7p. ! $, 36 &hil.; 3 2he le)al provisions, authors, and cases already invo.ed should ordinarily -e sufficient to dispose of this case. Dut inasmuch as ,e are announcin) doctrines that have -een little understood, in the past, it mi)ht not he inappropriate to indicate their foundations. Firstly, the (evised &enal Code in articles 6!" punishes not only rec.less -ut also simple ne)li)ence. If ,e ,ere to hold that articles 9%2 to 9 % of the Civil Code refer only to fault or ne)li)ence not punished -y la,, accordin)ly to the literal import of article %96 of the Civil Code, the le)al institution of culpa aquiliana ,ould have very little scope and application in actual life. ?eath or in5ury to persons and dama)e to property- throu)h any de)ree of ne)li)ence - even the sli)htest - ,ould have to -e Idemnified only throu)h the principle of civil lia-ility arisin) from a crime. In such a state of affairs, ,hat sphere ,ould remain for cuasi-delito or culpa aquilianaH =e are loath to impute to the la,ma.er any intention to -rin) a-out a situation so a-surd and anomalous. #or are ,e, in the interpretation of the la,s, disposed to uphold the letter that .illeth rather than the spirit that )iveth life. =e ,ill not use the literal meanin) of the la, to smother and render almost lifeless a principle of such ancient ori)in and such full-)ro,n development as culpa aquiliana or cuasi-delito, ,hich is conserved and made endurin) in articles 9%2 to 9 % of the @panish Civil Code.

@econdary, to find the accused )uilty in a criminal case, proof of )uilt -eyond reasona-le dou-t is re/uired, ,hile in a civil case, preponderance of evidence is sufficient to ma.e the defendant pay in dama)es. 2here are numerous cases of criminal ne)li)ence ,hich can not -e sho,n -eyond reasona-le dou-t, -ut can -e proved -y a preponderance of evidence. In such cases, the defendant can and should -e made responsi-le in a civil action under articles 9%2 to 9 % of the Civil Code. >ther,ise. there ,ould -e many instances of unvindicated civil ,ron)s. 0 Ubi jus Idemnified remedium.0 7p. !2%,36 &hil.; Fourthly, -ecause of the -road s,eep of the provisions of -oth the &enal Code and the Civil Code on this su-5ect, ,hich has )iven rise to the overlappin) or concurrence of spheres already discussed, and for lac. of understandin) of the character and efficacy of the action for culpa aquiliana, there has )ro,n up a common practice to see. dama)es only -y virtue of the civil responsi-ility arisin) from a crime, for)ettin) that there is another remedy, ,hich is -y invo.in) articles 9%2- 9 % of the Civil Code. Althou)h this ha-itual method is allo,ed -y, our la,s, it has nevertheless rendered practically useless and nu)atory the more e<peditious and effective remedy -ased on culpa aquiliana or culpa extra-contractual. In the present case, ,e are as.ed to help perpetuate this usual course. Dut ,e -elieve it is hi)h time ,e pointed out to the harms done -y such practice and to restore the principle of responsi-ility for fault or ne)li)ence under articles 9%2 et se/. of the Civil Code to its full ri)or. It is hi)h time ,e caused the stream of /uasi-delict or culpa aquiliana to flo, on its o,n natural channel, so that its ,aters may no lon)er -e diverted into that of a crime under the &enal Code. 2his ,ill, it is -elieved, ma.e for the -etter safe)uardin) or private ri)hts -ecause it realtor, an ancient and additional remedy, and for the further reason that an independent civil action, not dependin) on the issues, limitations and results of a criminal prosecution, and entirely directed -y the party ,ron)ed or his counsel, is more li.ely to secure ade/uate and efficacious redress. 7p. !2 , 36 &hil.; Contrary to an immediate impression one mi)ht )et upon a readin) of the fore)oin) e<cerpts from the opinion in Carcia that the concurrence of the &enal Code and the Civil Code therein referred to contemplate only acts of ne)li)ence and not intentional voluntary acts - deeper reflection ,ould reveal that the thrust of the pronouncements therein is not so limited, -ut that in fact it actually e<tends to fault or culpa. 2his can -e seen in the reference made therein to the @entence of the @upreme Court of @pain of Fe-ruary 9, 9 9, supra, ,hich involved a case of fraud or estafa, not a ne)li)ent act. Indeed, Article %96 of the Civil Code of @pain, in force here at the time of Carcia, provided te<tually that o-li)ations 0,hich are derived from acts or omissions in ,hich fault or ne)li)ence, not punishable by law, intervene shall -e the su-5ect of Chapter II, 2itle IF of this -oo. 7,hich refers to /uasi-delicts.;0 And it is precisely the underline /ualification, 0not punisha-le -y la,0, that Justice Doco-o emphasized could lead to an ultimo construction or interpretation of the letter of the la, that 0.illeth, rather than the spirit that )iveth lift- hence, the rulin) that 07=;e ,ill not use the literal meanin) of the la, to smother and render almost lifeless a principle of such ancient ori)in and such full-)ro,n development as culpa aquiliana orquasi-delito, ,hich is conserved and made endurin) in articles 9%2 to 9 % of the @panish Civil Code.0 And so, -ecause Justice Daco-o ,as Chairman of the Code Commission that drafted the ori)inal te<t of the ne, Civil Code, it is to -e noted that the said Code, ,hich ,as enacted after the Carcia doctrine, no lon)er uses the term, not punisha-le -y la,,0 there-y ma.in) it clear that the concept of culpa aquiliana includes acts ,hich are criminal in character or in violation of the penal la,, ,hether voluntary or matter. 2hus, the correspondin) provisions to said Article %96 in the ne, code, ,hich is Article !2, simply says, 0>-li)ations derived from quasi-delicto shall -e )overned -y the provisions of Chapter 2, 2itle IFII of this Doo., 7on quasi-delicts; and -y special la,s.0 +ore precisely, a ne, provision, Article 2 33 of the ne, code provides1 A(2. 2 33. (esponsi-ility for fault or ne)li)ence under the precedin) article is entirely separate and distinct from the civil lia-ility arisin) from ne)li)ence under the &enal Code. Dut the plaintiff cannot recover dama)es t,ice for the same act or omission of the defendant. Accordin) to the Code Commission1 02he fore)oin) provision 7Article 2 33; throu)h at first si)ht startlin), is not so novel or e<traordinary ,hen ,e consider the e<act nature of criminal and civil ne)li)ence. 2he former is a violation of the criminal la,, ,hile the latter is a 0culpa a/uiliana0 or /uasi-delict, of ancient ori)in, havin) al,ays had its o,n foundation and individuality, separate from criminal ne)li)ence. @uch distinction -et,een criminal ne)li)ence and 0culpa e<tracontractual0 or 0cuasi-delito0 has -een sustained -y decision of the @upreme Court of @pain and maintained as clear, sound and perfectly tena-le -y +aura, an outstandin) @panish 5urist. 2herefore, under the proposed Article 2 33, ac/uittal from an accusation of criminal ne)li)ence, ,hether on reasona-le dou-t or not, shall not -e a -ar to a su-se/uent civil action, not for civil lia-ility arisin) from criminal ne)li)ence, -ut for dama)es due to a /uasi-delict or Gculpa a/uilianaG. Dut said article forestalls a dou-le recovery.0, 7(eport of the Code; Commission, p. !2.; Althou)h, a)ain, this Article 2 33 does seem to literally refer to only acts of ne)li)ence, the same ar)ument of Justice Daco-o a-out construction that upholds 0the spirit that )iveth lift- rather than that ,hich is literal that .illeth the intent of the la,ma.er should -e o-served in applyin) the same. And considerin) that the preliminary chapter on human relations of the ne, Civil Code definitely esta-lishes the separa-ility and independence of lia-ility in a civil action for acts criminal in character 7under Articles 29 to 62; from the civil responsi-ility arisin) from crime fi<ed -y Article %% of the (evised &enal Code, and, in a sense, the (ules of Court, under @ections 2 and 6 7c;, (ule , contemplate also the same separa-ility, it is 0more con)ruent ,ith the spirit of la,, e/uity and 5ustice, and more in harmony ,ith modern pro)ress0- to -orro, the felicitous relevant lan)ua)e in Ra es vs. !tlantic. Gulf and "acific #o., 3 &hil. 6"9, to hold, as =e do hold, that Article 2 3!, ,here it refers to 0fault or ne)li)encia covers not only acts 0not punisha-le -y la,0 -ut also acts criminal in character, ,hether intentional and voluntary or ne)li)ent. Conse/uently, a separate civil action lies a)ainst the offender in a criminal act, ,hether or not he is criminally prosecuted and found )uilty or

ac/uitted, provided that the offended party is not allo,ed, if he is actually char)ed also criminally, to recover dama)es on -oth scores, and ,ould -e entitled in such eventuality only to the -i))er a,ard of the t,o, assumin) the a,ards made in the t,o cases vary. In other ,ords, the e<tinction of civil lia-ility referred to in &ar. 7e; of @ection 6, (ule , refers e<clusively to civil lia-ility founded on Article %% of the (evised &enal Code, ,hereas the civil lia-ility for the same act considered as a quasi-delict only and not as a crime is not estin)uished even -y a declaration in the criminal case that the criminal act char)ed has not happened or has not -een committed -y the accused. Driefly stated, =e here hold, in reiteration of Carcia, thatculpa aquiliana includes voluntary and ne)li)ent acts ,hich may -e punisha-le -y la,.4 It results, therefore, that the ac/uittal of (e)inal *ill in the criminal case has not e<tin)uished his lia-ility for quasidelict, hence that ac/uittal is not a -ar to the instant action a)ainst him. Comin) no, to the second issue a-out the effect of (e)inaldGs emancipation -y marria)e on the possi-le civil lia-ility of Atty. *ill, his father, it is also >ur considered opinion that the conclusion of appellees that Atty. *ill is already free from responsi-ility cannot -e upheld. =hile it is true that parental authority is terminated upon emancipation of the child 7Article 623, Civil Code;, and under Article 693, emancipation ta.es place 0-y the marria)e of the minor 7child;0, it is, ho,ever, also clear that pursuant to Article 699, emancipation -y marria)e of the minor is not really full or a-solute. 2hus 07';mancipation -y marria)e or -y voluntary concession shall terminate parental authority over the childGs person. It shall ena-le the minor to administer his property as thou)h he ,ere of a)e, -ut he cannot -orro, money or alienate or encum-er real property ,ithout the consent of his father or mother, or )uardian. *e can sue and -e sued in court only ,ith the assistance of his father, mother or )uardian.0 #o, under Article 2 $%, 072;he o-li)ation imposed -y article 2 3! is demanda-le not only for oneGs o,n acts or omissions, -ut also for those of persons for ,hom one is responsi-le. 2he father and, in case of his death or incapacity, the mother, are responsi-le. 2he father and, in case of his death or incapacity, the mother, are responsi-le for the dama)es caused -y the minor children ,ho live in their company.0 In the instant case, it is not controverted that (e)inald, althou)h married, ,as livin) ,ith his father and )ettin) su-sistence from him at the time of the occurrence in /uestion. Factually, therefore, (e)inald ,as still su-servient to and dependent on his father, a situation ,hich is not unusual. It must -e -orne in mind that, accordin) to +anresa, the reason -ehind the 5oint and solidary lia-ility of presuncion ,ith their offendin) child under Article 2 $% is that is the o-li)ation of the parent to supervise their minor children in order to prevent them from causin) dama)e to third persons. / >n the other hand, the clear implication of Article 699, in providin) that a minor emancipated -y marria)e may not, nevertheless, sue or -e sued ,ithout the assistance of the parents, is that such emancipation does not carry ,ith it freedom to enter into transactions or do any act that can )ive rise to 5udicial liti)ation. 7@ee +anresa, Id., Fol. II, pp. 3!!-3!3, 33!.; And surely, .illin) someone else invites 5udicial action. >ther,ise stated, the marria)e of a minor child does not relieve the parents of the duty to see to it that the child, ,hile still a minor, does not )ive ans,era-le for the -orro,in)s of money and alienation or encum-erin) of real property ,hich cannot -e done -y their minor married child ,ithout their consent. 7Art. 6994 +anresa, supra.; Accordin)ly, in >ur considered vie,, Article 2 $% applies to Atty. *ill not,ithstandin) the emancipation -y marria)e of (e)inald. *o,ever, inasmuch as it is evident that (e)inald is no, of a)e, as a matter of e/uity, the lia-ility of Atty. *ill has -ecome millin), su-sidiary to that of his son. =*'('F>(', the order appealed from is reversed and the trial court is ordered to proceed in accordance ,ith the fore)oin) opinion. Costs a)ainst appellees.

G.R. No. 74041

0.*y 29, 1987

T+E PEOPLE O1 T+E P+ILIPPINE2, plaintiff-appellee, vs. ROGELIO LIGON y TRIA2 and 1ERNANDO GA3AT y ALMERA, accused, 1ERNANDO GA3AT y ALMERA, accused-appellant. 2his is an appeal from the 5ud)ment of the (e)ional 2rial Court of +anila, Dranch II, rendered on Fe-ruary 3, 9$!, convictin) the accused-appellant, Fernando Ca-at, of the crime of (o--ery ,ith *omicide and sentencin) him to reclusion perpetua. 2he victim ,as Jose (osales y >rtiz, a ,@eventeen-year old ,or.in) student ,ho ,as earnin) his .eep as a ci)arette vendor. *e ,as alle)edly ro--ed of 's ci)arette -o< containin) ci)arettes ,orth &6%%.%% more or less. >nly Fernando Ca-at ,as arrested and -rou)ht to trial and convicted. 2he other accused, (o)elio Ai)on, ,as never apprehended and is still at lar)e. 2he fatal incident happened on a @unday, >cto-er 26, 9$6 at a-out !1 % p.m. 2he accused, Fernando Ca-at, ,as ridin) in a 93$ Fol.s,a)en Jom-i o,ned -y his father, Antonio Ca-at, and driven -y the other accused, (o)elio Ai)on. 2he Jom-i ,as comin) from 'spana @treet )oin) to,ards the direction of Quiapo. Fernando Ca-at ,as seated -eside the driver, in the front seat -y the ,indo, on the ri)ht side of the Jom-i. At the intersection of Quezon Doulevard and Aerma @treet -efore turnin) left to,ards the underpass at C.+. (ecto Avenue, the Jom-i had to stop as the traffic li)ht ,as red. =hile ,aitin) for the traffic li)ht to chan)e, Fernando Ca-at -ec.oned a ci)arette vendor, Jose (osales y >rtiz 7(osales for short; to -uy some ci)arettes from him. (osales approached the Jom-i and handed Ca-at t,o stic.s of ci)arettes. =hile this transaction ,as occurrin), the traffic li)ht chan)ed to )reen, and the Jom-i driven -y (o)elio Ai)on suddenly moved for,ard. As to ,hat precisely happened -et,een Ca-at and (osales at the crucial moment, and immediately thereafter, is the su-5ect of conflictin) versions -y the prosecution and the defense. It is not controverted, ho,ever, that as the Jom-i continued to speed to,ards Quiapo, (osales clun) to the ,indo, of the Jom-i -ut apparently lost his )rip and fell do,n on the pavement. (osales ,as rushed -y some -ystanders to the &hilippine Ceneral *ospital, ,here he ,as treated for multiple physical in5uries and ,as confined thereat until his death on >cto-er 6%, 9$6. Follo,in) close -ehind the Jom-i at the time of the incident ,as a ta<ica- driven -y &rudencio Castillo. *e ,as -ehind the Jom-i, at a distance of a-out three meters, travellin) on the same lane in a sli)htly o-li/ue position 70a little -it to the ri)ht0;.2 As the Jom-i did not stop after the victim fell do,n on the pavement near the foot of the underpass, Castillo pursued it as it sped to,ards (o<as Doulevard, -eepin) his horn to ma.e the driver stop. =hen they reached the Auneta near the (izal monument, Castillo sa, an o,ner-type 5eep ,ith t,o persons in it. *e sou)ht their assistance in chasin) the Jom-i, tellin) them 0na aa sidente n$ tao.06 2he t,o men in the 5eep 5oined the chase and at the intersection of Fito Cruz and (o<as Doulevard, Castillo ,as a-le to overta.e the Jom-i ,hen the traffic li)ht turned red. *e immediately -loc.ed the Jom-i ,hile the 5eep pulled up ri)ht -ehind it. 2he t,o men on -oard the 5eep turned out to -e police officers, &atrolmen Aeonardo &u)ao and &eter I)nacio. 2hey dre, their )uns and told the driver, (o)elio Ai)on, and his companion, Fernando Ca-at, to ali)ht from the Jom-i. It ,as found out that there ,as a third person inside the Jom-i, a certain (odolfo &rimicias ,ho ,as sleepin) at the rear seat. 9 2he three ,ere all -rou)ht -y the police officers to the =estern &olice ?istrict and turned over to &fc. Fernan &ayuan. 2he ta<icadriver, &rudencio Castillo, also ,ent alon) ,ith them. 2he ,ritten statements of Castillo and (odolfo &rimicias ,ere ta.en -y the traffic investi)ator, &fc. Fernan &ayuan." &ayuan also prepared a 2raffic Accident (eport, dated >cto-er 26, 9$6.! Fernando Ca-at and (odolfo &rimicias ,ere released early mornin) the follo,in) day, -ut (o)elio Ai)on ,as detained and turned over to the City FiscalGs >ffice for further investi)ation. Investi)atin) Fiscal Alfredo Cantos, filed an information in court a)ainst (o)elio Ai)on dated ?ecem-er !, 9$6 char)in) him ,ith *omicide thru (ec.less Imprudence.3 @i< months later, ho,ever, or on June 2$, 9$9, Assistant Fiscal Cantos filed another information a)ainst (o)elio Ai)on and Fernando Ca-at for (o--ery ,ith *omicide. $*e filed the latter information on the -asis of a @upplemental Affidavit of &rudencio Castillo 9 and a 5oint affidavit of

Armando 'spino and (omeo Castil, ci)arette vendors, ,ho alle)edly ,itnessed the incident on >cto-er 26, 9$6. % 2hese affidavits ,ere already prepared and merely s,orn to -efore Fiscal Cantos on January 3, 9$9. >n >cto-er 6 , 9$6, an autopsy ,as conducted -y the medico-le)al officer of the #ational Dureau of Investi)ation, ?r. >rlando F. @alvador, ,ho stated in his autopsy report that the cause of death of (osales ,as 0pneumonia hypostatic, -ilateral, secondary to traumatic in5uries of the head.0 2he prosecution tried to esta-lish, throu)h the sole testimony of the ta<ica- driver, &rudencio Castillo, that Ca-at )ra--ed the -o< of ci)arettes from (osales and pried loose the latterGs hand from the ,indo, of the Jom-i, resultin) in the latter fallin) do,n and hittin) the pavement. In its decision, the trial court summarized the testimony of Castillo as follo,s1 At a-out !1%% oGcloc. in the evenin) of >cto-er 26, 9$6, Castillo ,as then drivin) his ta<ica- alon) Aerma @treet near Far 'astern Bniversity, and at the intersection of Aerma and Quezon Doulevard, the traffic li)ht chan)ed from )reen to red. 2he vehicular traffic stopped and &rudencio CastilloGs ta<i ,as ri)ht -ehind a Fol.s,a)en Jom-i. =hile ,aitin) for the traffic li)ht to chan)e to )reen, Castillo Idly ,atched the Fol.s,a)en Jom-i and sa, Ca-at, the passen)er sittin) -eside the driver, si)nal to a ci)arette vendor. 2he ci)arette vendor, (osales, approached the ri)ht side of the Jom-i. =hile (osales ,as handin) the ci)arettes to Ca-at, the traffic li)ht suddenly chan)ed to )reen. =hen the Jom-i moved for,ard, Ca-at suddenly )ra--ed the ci)arette -o< held -y (osales. 2a.en a-ac., Jose (osales ran -eside the Jom-i and ,as a-le to hold on to the ,indo,sill of the ri)ht front door ,ith his ri)ht hand. =hile (osales ,as clin)in) to the ,indo,sill, ,ith -oth feet off the )round, the Jom-i continued to speed to,ards the C.+. (ecto underpass. Castillo, ,ho ,as closely follo,in) the Jom-i, then sa, Ca-at forci-ly remove the hand of (osales from the ,indo,sill and the latter fell face do,n on Quezon Doulevard near the (ecto underpass. 2 2he version of the defense, on the other hand, ,as summarized -y the court as follo,s1 >n the date and time in /uestion, Fernando Ca-at, 6 years old, an under,riter, ,as on -oard the Fol.s,a)en Jom-i driven -y (o)elio Ai)on. 2he Jom-i had to stop at the intersection of Aerma @treet and Quezon Doulevard ,hen the traffic li)ht turned red. Fernando Ca-at, ,ho ,anted to -uy ci)arettes, called a ci)arette vendor ,ho approached the ri)ht side of the Jom-i. Ca-at -ou)ht t,o stic.s of ci)arettes and handed to the ci)arette vendor, (osales, a &".%% -ill. In order to chan)e the &".%% -i), (osales placed his ci)arette -o< containin) assorted ci)arettes on the ,indo,sill of the front door of the Jom-i -et,een the arm of Ca-at and the ,indo, frame. @uddenly, the traffic li)ht chan)ed from red to )reen and (o)elio Ai)on moved the vehicle for,ard, heedless of the transaction -et,een Ca-at and the ci)arette vendor. As the vehicle sped on,ard, the ci)arette -o< ,hich ,as s/ueezed -et,een the ri)ht arm of Ca-at and the ,indo, frame fell inside the Jom-i. (osales then ran -eside the vehicle and clun) to the ,indo,sill of the movin) vehicle. Ca-at testified that ,hen he sa, the ci)arette vendor clin)in) on the side of the front door, he told Ai)on to veer to the ri)ht in order that (osales could )et off at the side,al.. *o,ever, Ca-at declared, that Ai)on said that it could not -e done -ecause of the movin) vehicular traffic. 2hen, ,hile the vehicle slo,ed do,n and Ai)on ,as maneuverin) to the ri)ht in an attempt to )o to,ard the side,al., (osales lost his )rip on the ,indo, frame and fell to the pavement of Quezon Doulevard. Ca-at alle)edly shouted at Ai)on to stop -ut Ai)on replied that they should )o on to Aas &inas and report the incident to the parents of Ca-at, and later they ,ould come -ac. to the scene of the incident. *o,ever, ,hile the Jom-i ,as speedin) alon) ?e,ey Doulevard, it ,as -loc.ed -y the ta<i of &rudencio Castillo and a 5eep driven -y policemen. Ca-at and Ai)on ,ere -rou)ht to police head/uarters, -ut neither of them e<ecuted any ,ritten statement. 6 2he trial court )ave full credence to the prosecutionGs version, statin) that there can -e no dou-t that Ca-at forci-ly too. or )ra--ed the ci)arette -o< from (osales -ecause, other,ise, there could -e no reason for the latter to run after the Jom-i and han) on to its ,indo,. 2he court also -elieved CastilloGs testimony that Ca-at forci-ly removed or pried off the ri)ht hand of (osales from the ,indo,sill of the Jom-i, other,ise, the latter could not have fallen do,n, havin) already -een a-le to -alance himself on the step-oard. >n the other hand, the trial court dismissed as incredi-le the testimony of Ca-at that the ci)arette vendor placed the ci)arette -o< on the ,indo,sill of the Jom-i, holdin) it ,ith his left hand, ,hile he ,as tryin) to )et from his poc.et the chan)e for the "-peso -ill of Ca-at. 2he court said that it is of common .no,led)e that ci)arette vendors plyin) their trade in the streets do not let )o of their ci)arette -o<4 no vendor lets )o of his precious -o< of ci)arettes in order to chan)e a peso -in )iven -y a customer. As a rule, the findin)s of fact of the trial court are accorded )reat respect and are not distur-ed on appeal, unless it is sho,s that the findin)s are not supported -y the evidence, or the court failed to consider certain material facts and circumstances in its evaluation of the evidence. In the case at -ar, a careful revie, of the record sho,s that certain material facts and circumstances had -een overloo.ed -y the trial court ,hich, if ta.en into account, ,ould alter the result of the case in that they ,ould introduce an element of reasona-le dou-t ,hich ,ould entitle the accused to ac/uittal. =hile the prosecution ,itness, Castillo, may -e a disinterested ,itness ,ith no motive, accordin) to the court a quo, 0other than to see that 5ustice -e done,0 his testimony, even if not tainted ,ith -ias, is not entirely free from dou-t -ecause his o-servation of the event could have -een faulty or mista.en. 2he ta<ica- ,hich Castillo ,as drivin) ,as lo,er in hei)ht compared to the Jom-i in ,hich Ca-at ,as ridin)-a fact admitted -y Castillo at the trial. 9 Judicial notice may also -e ta.en of the fact that the rear ,indshield of the 93$ Fol.s,a)en Jom-i is on the upper portion, occupyin) appro<imately one-third 7 K6; of the rear end of the vehicle, thus ma.in) it visually difficult for Castillo to o-serve clearly ,hat transpired inside the Jom-i at the front end ,here Ca-at ,as seated. 2hese are circumstances ,hich must -e ta.en into consideration in evaluatin) CastilloGs testimony as to ,hat e<actly happened -et,een Ca-at and the ci)arette vendor durin) that crucial moment -efore the latter fell do,n. As the ta<ica- ,as ri)ht -ehind the Jom-i, follo,in) it at a distance of a-out three meters, CastilloGs line of vision ,as partially o-structed -y the -ac.

part of the Jom-i. *is testimony that he sa, Ca-at )ra- the ci)arette -o< from (osales and forci-ly pry loose the latterGs hand from the ,indo,sill of the Jom-i is thus su-5ect to a reasona-le dou-t, specially considerin) that this occurrence happened in 5ust a matter of seconds, and -oth vehicles durin) that time ,ere movin) fast in the traffic. =e find it si)nificant that in his statement )iven to the police that very evenin), " Castillo did not mention that he sa, Ca-at forci-ly pryin) off the hand of (osales from the ,indo,sill of the Jom-i, althou)h the police report prepared -y the investi)atin) officer, &fc. Fermin +. &ayuan, on the same date, stated that ,hen the traffic si)nal chan)ed to )reen and the driver stepped on the )as, the ci)arette -o< of the ci)arette vendor 7(osales; ,as )ra--ed -y the passen)er Ca-at and 0instantly the former clun) to the door and ,as dra))ed at a distance ,hile at the same time the latter punched the vendorGs arm until the same 7sic; fell to the pavement,0 thus sho,in) that durin) the police investi)ation Castillo must have )iven a statement to the police ,hich indicated that Ca-at did somethin) to cause (osales to fall from the Jom-i. ! It ,as -y ,ay of a supplementary affidavit prepared -y the la,yer of the complainant and s,orn to -y Castillo -efore the Assistant City Fiscal on January 3, 9$9 that this vital detail ,as added. 2his supplementary affidavit ,as made the -asis for filin) another information char)in) -oth Ca-at and the driver ,ith the crime of (o--ery ,ith *omicide. Considerin) the a-ove circumstances, the Court is not convinced ,ith moral certainty that the )uilt of the accused Fernando Ca-at has -een esta-lished -eyond reasona-le dou-t. In our vie,, the /uantum of proof necessary to sustain Ca-atGs conviction of so serious a crime as ro--ery ,ith homicide has not -een met in this case. *e is therefore entitled to ac/uittal on reasona-le dou-t. *o,ever, it does not follo, that a person ,ho is not criminally lia-le is also free from civil lia-ility. %avvphi% =hile the )uilt of the accused in a criminal prosecution must -e esta-lished -eyond reasona-le dou-t, only a preponderance of evidence is re/uired in a civil action for dama)es. 3 2he 5ud)ment of ac/uittal e<tin)uishes the civil lia-ility of the accused only ,hen it includes a declaration that the facts from ,hich the civil lia-ility mi)ht arise did not e<ist. $ 2he reason for the provisions of Article 29 of the Civil Code, ,hich provides that the ac/uittal of the accused on the )round that his )uilt has not -een proved -eyond reasona-le dou-t does not necessarily e<empt him from civil lia-ility for the same act or omission, has -een e<plained -y the Code Commission as follo,s1 2he old rule that the ac/uittal of the accused in a criminal case also releases him from civil lia-ility is one of the most serious fla,s in the &hilippine le)al system. It has )iven rise to num-erless instances of miscarria)e of 5ustice, ,here the ac/uittal ,as due to a reasona-le dou-t in the mind of the court as to the )uilt of the accused. 2he reasonin) follo,ed is that inasmuch as the civil responsi-ility is derived from the criminal offense, ,hen the latter is not proved, civil lia-ility cannot -e demanded. 2his is one of those cases ,here confused thin.in) leads to unfortunate and deplora-le conse/uences. @uch reasonin) fails to dra, a clear line of demarcation -et,een criminal lia-ility and civil responsi-ility, and to determine the lo)ical result of the distinction. 2he t,o lia-ilities are separate and distinct from each other. >ne affects the social order and the other, private ri)hts. >ne is for the punishment or correction of the offender ,hile the other is for reparation of dama)es suffered -y the a))rieved party. 2he t,o responsi-ilities are so different from each other that article $ 6 of the present 7@panish; Civil Code reads thus1 02here may -e a compromise upon the civil action arisin) from a crime4 -ut the pu-lic action for the imposition of the le)al penalty shall not there-y -e e<tin)uished.0 It is 5ust and proper that, for the purposes of the imprisonment of or fine upon the accused, the offense should -e proved -eyond reasona-le dou-t. Dut for the purpose of indemnifyin) the complainin) party, ,hy should the offense also -e proved -eyond reasona-le dou-tH Is not the invasion or violation of every private ri)ht to -e proved only -y a preponderance of evidenceH Is the ri)ht of the a))rieved person any less private -ecause the ,ron)ful act is also punisha-le -y the criminal la,H For these reasons, the Commission recommends the adoption of the reform under discussion. It ,ill correct a serious defect in our la,. It ,ill close up an ine<hausti-le source of in5ustice a cause for disillusionment on the part of the innumera-le persons in5ured or ,ron)ed. 9 In the instant case, ,e find that a preponderance of evidence e<ists sufficient to esta-lish the facts from ,hich the civil lia-ility of Ca-at arises. >n the -asis of the trial courtGs evaluation of the testimonies of -oth prosecution and defense ,itnesses at the trial and applyin) the /uantum of proof re/uired in civil cases, ,e find that a preponderance of evidence esta-lishes that Ca-at -y his act and omission ,ith fault and ne)li)ence caused dama)e to (osales and should ans,er civilly for the dama)e done. Ca-atGs ,ilfull act of callin) (osales, the ci)arette vendor, to the middle of a -usy street to -uy t,o stic.s of ci)arettes set the chain of events ,hich led to the death of (osales. 2hrou)h fault and ne)li)ence, Ca-at 7 ; failed to prevent the driver from movin) for,ard ,hile the purchase ,as completed4 72; failed to help (osales ,hile the latter clun) precariously to the movin) vehicle, and 76; did not enforce his order to the driver to stop. Finally, Ca-at ac/uiesced in the driverGs act of speedin) a,ay, instead of stoppin) and pic.in) up the in5ured victim. 2hese proven facts ta.en to)ether are firm -ases for findin) Ca-at civilly lia-le under the Civil Code2% for the dama)e done to (osales. =*'('F>(', 5ud)ment is rendered ac/uittin) the appellant Ca-at for the crime of (o--ery ,ith *omicide. *o,ever, he is here-y held civilly lia-le for his acts and omissions, there -ein) fault or ne)li)ence, and sentenced to indemnify the heirs of Jose (osales y >rtiz in the amount of & ".%%%.%% for the latterGs death, & ,366.6" for hospital and medical e<penses, and &9, %%.%% for funeral e<penses. 2he alle)ed loss of income amountin) to &2%,%%%.%%, not -ein) supported -y sufficient evidence, is ?'#I'?. Costs de officio.

G.R. No. 9869/ 0an.a$y 27, 1993 04AN 0. 2564IA, CORA7ON C. 2564IA, CARLOTA C. 2564IA, CARLO2 C. 2564IA and ANT+ON5 C. 2564IA, petitioners, vs. T+E +ONORA3LE CO4RT O1 APPEAL2, and T+E MANILA MEMORIAL PAR8 CEMETER5, INC., respondents. CAMPO2, 0R., J.: *erein petitioners, Juan J. @y/uia and Corazon C. @y/uia, Carlota C. @y/uia, Carlos C. @y/uia, and Anthony @y/uia, ,ere the parents and si-lin)s, respectively, of the deceased Ficente Juan @y/uia. >n +arch ", 939, they filed a complaint 1 in the then Court of First Instance a)ainst herein private respondent, +anila +emorial &ar. Cemetery, Inc. for recovery of dama)es arisin) from -reach of contract andKor /uasi-delict. 2he trial court dismissed the complaint. 2he antecedent facts, as )athered -y the respondent Court, are as follo,s1 >n +arch ", 939, Juan, Corazon, Carlota and Anthony all surnamed @y/uia, plaintiff-appellants herein, filed a complaint for dama)es a)ainst defendant-appellee, +anila +emorial &ar. Cemetery, Inc. 2he complaint alle)ed amon) others, that pursuant to a ?eed of @ale 7Contract #o. !$$"; dated Au)ust 23, 9!9 and Interment >rder #o. 3 %! dated July 2 , 93$ e<ecuted -et,een plaintiffappellant Juan J. @y/uia and defendant-appellee, the former, father of deceased Ficente Juan J. @y/uia authorized and instructed defendant-appellee to inter the remains of deceased in the +anila +emorial &ar. Cemetery in the mornin) of July 2", 93$ conforma-ly and in accordance

,ith defendant-appellantGs 7sic; interment procedures4 that on @eptem-er 9, 93$, preparatory to transferrin) the said remains to a ne,ly purchased family plot also at the +anila +emorial &ar. Cemetery, the concrete vault encasin) the coffin of the deceased ,as removed from its niche under)round ,ith the assistance of certain employees of defendant-appellant 7sic;4 that as the concrete vault ,as -ein) raised to the surface, plaintiffs-appellants discovered that the concrete vault had a hole appro<imately three 76; inches in diameter near the -ottom of one of the ,alls closin) out the ,idth of the vault on one end and that for a certain len)th of time 7one hour, more or less;, ,ater drained out of the hole4 that -ecause of the aforesaid discovery, plaintiffsappellants -ecame a)itated and upset ,ith concern that the ,ater ,hich had collected inside the vault mi)ht have risen as it in fact did rise, to the level of the coffin and flooded the same as ,ell as the remains of the deceased ,ith ill effects thereto4 that pursuant to an authority )ranted -y the +unicipal Court of &araLa/ue, +etro +anila on @eptem-er 9, 93$, plaintiffs-appellants ,ith the assistance of licensed morticians and certain personnel of defendant-appellant 7sic; caused the openin) of the concrete vault on @eptem-er ", 93$4 that upon openin) the vault, the follo,in) -ecame apparent to the plaintiffs-appellants1 7a; the interior ,alls of the concrete vault sho,ed evidence of total floodin)4 7-; the coffin ,as entirely dama)ed -y ,ater, filth and silt causin) the ,ooden parts to ,arp and separate and to crac. the vie,in) )lass panel located directly a-ove the head and torso of the deceased4 7c; the entire linin) of the coffin, the clothin) of the deceased, and the e<posed parts of the deceasedGs remains ,ere dama)ed and soiled -y the action of the ,ater and silt and ,ere also coated ,ith filth. ?ue to the alle)ed unla,ful and malicious -reach -y the defendant-appellee of its o-li)ation to deliver a defect-free concrete vault desi)ned to protect the remains of the deceased and the coffin a)ainst the elements ,hich resulted in the desecration of deceasedGs )rave and in the alternative, -ecause of defendant-appelleeGs )ross ne)li)ence conforma-ly to Article 2 3! of the #e, Civil Code in failin) to seal the concrete vault, the complaint prayed that 5ud)ment -e rendered orderin) defendant-appellee to pay plaintiffs-appellants &6%,%%%.%% for actual dama)es, &"%%,%%%.%% for moral dama)es, e<emplary dama)es in the amount determined -y the court, 2%M of defendant-appelleeGs total lia-ility as attorneyGs fees, and e<penses of liti)ation and costs of suit. 2 In dismissin) the complaint, the trial court held that the contract -et,een the parties did not )uarantee that the cement vault ,ould -e ,aterproof4 that there could -e no /uasi-delict -ecause the defendant ,as not )uilty of any fault or ne)li)ence, and -ecause there ,as a pre-e<istin) contractual relation -et,een the @y/uias and defendant +anila +emorial &ar. Cemetery, Inc.. 2he trial court also noted that the father himself, Juan @y/uia, chose the )ravesite despite .no,in) that said area had to -e constantly sprin.led ,ith ,ater to .eep the )rass )reen and that ,ater ,ould eventually seep throu)h the vault. 2he trial court also accepted the e<planation )iven -y defendant for -orin) a hole at the -ottom side of the vault1 02he hole had to -e -ored throu)h the concrete vault -ecause if it has no hole the vault ,ill 7sic; float and the )rave ,ould -e filled ,ith ,ater and the di))in) ,ould caved 7sic; in the earth, the earth ,ould caved 7sic; in the 7sic; fill up the )rave.0 3 From this 5ud)ment, the @y/uias appealed. 2hey alle)ed that the trial court erred in holdin) that the contract allo,ed the floodin) of the vault4 that there ,as no desecration4 that the -orin) of the hole ,as 5ustifia-le4 and in not a,ardin) dama)es. 2he Court of Appeals in the ?ecision 4 dated ?ecem-er 3, 99% ho,ever, affirmed the 5ud)ment of dismissal. &etitionerGs motion for reconsideration ,as denied in a (esolution dated April 2", 99 . / Bnsatisfied ,ith the respondent CourtGs decision, the @y/uias filed the instant petition. 2hey alle)e herein that the Court of Appeals committed the follo,in) errors ,hen it1 . held that the contract and the (ules and (esolutions of private respondent allo,ed the floodin) of the vault and the entrance thereto of filth and silt4 2. held that the act of -orin) a hole ,as 5ustifia-le and corollarily, ,hen it held that no act of desecration ,as committed4 6. overloo.ed and refused to consider relevant, undisputed facts, such as those ,hich have -een stipulated upon -y the parties, testified to -y private respondentGs ,itnesses, and admitted in the ans,er, ,hich could have 5ustified a different conclusion4 9. held that there ,as no tort -ecause of a pre-e<istin) contract and the a-sence of faultKne)li)ence4 and ". did not a,ard the &2",%%%.%% actual dama)es ,hich ,as a)reed upon -y the parties, moral and e<emplary dama)es, and attorneyGs fees. At the -ottom of the entire proceedin)s is the act of -orin) a hole -y private respondent on the vault of the deceased .in of the -ereaved petitioners. 2he latter alle)e that such act ,as either a -reach of private respondentGs contractual o-li)ation to provide a sealed vault, or, in the alternative, a ne)li)ent act ,hich constituted a /uasi-delict.

#onetheless, petitioners claim that ,hatever .ind of ne)li)ence private respondent has committed, the latter is lia-le for desecratin) the )rave of petitionersG dead. In the instant case, =e are called upon to determine ,hether the +anila +emorial &ar. Cemetery, Inc., -reached its contract ,ith petitioners4 or, alternatively, ,hether private respondent ,as )uilty of a tort. =e understand the feelin)s of petitioners and empathize ,ith them. Bnfortunately, ho,ever, =e are more inclined to ans,er the fore)oin) /uestions in the ne)ative. 2here is not enou)h )round, -oth in fact and in la,, to 5ustify a reversal of the decision of the respondent Court and to uphold the pleas of the petitioners. =ith respect to herein petitionersG averment that private respondent has committed culpa aquiliana, the Court of Appeals found no ne)li)ent act on the part of private respondent to 5ustify an a,ard of dama)es a)ainst it. Althou)h a pre-e<istin) contractual relation -et,een the parties does not preclude the e<istence of a culpa aquiliana, =e find no reason to disre)ard the respondentGs Court findin) that there ,as no ne)li)ence. Art. 2 3!. =hoever -y act or omission causes dama)e to another, there -ein) fault or ne)li)ence, is o-li)ed to pay for the dama)e done. &uch fault or ne$li$ence' if there is no preexistin$ contractual relation between the parties' is called a quasi-delict . . . . 7'mphasis supplied;. In this case, it has -een esta-lished that the @y/uias and the +anila +emorial &ar. Cemetery, Inc., entered into a contract entitled 0?eed of @ale and Certificate of &erpetual Care0 6 on Au)ust 23, 9!9. 2hat a)reement )overned the relations of the parties and defined their respective ri)hts and o-li)ations. *ence, had there -een actual ne)li)ence on the part of the +anila +emorial &ar. Cemetery, Inc., it ,ould -e held lia-le not for a quasi-delict or culpa aquiliana, -ut for culpa contractual as provided -y Article 3% of the Civil Code, to ,it1 2hose ,ho in the performance of their o-li)ations are )uilty of fraud, ne)li)ence, or delay, and those ,ho in any manner contravene the tenor thereof, are lia-le for dama)es. 2he +anila +emorial &ar. Cemetery, Inc. -ound itself to provide the concrete -o< to -e send in the interment. (ule 3 of the (ules and (e)ulations of private respondent provides that1 (ule 3. 'very earth interment shall -e made enclosed in a concrete -o<, or in an outer ,all of stone, -ric. or concrete, the actual installment of ,hich shall -e made -y the employees of the Association. 7 &ursuant to this a-ove-mentioned (ule, a concrete vault ,as provided on July 23, 93$, the day -efore the interment, and ,as, on the same day, installed -y private respondentGs employees in the )rave ,hich ,as du) earlier. After the -urial, the vault ,as covered -y a cement lid. &etitioners ho,ever claim that private respondent -reached its contract ,ith them as the latter held out in the -rochure it distri-uted that the . . . lot may hold sin)le or dou-le internment 7sic; under)round in sealed concrete vault.0 8 &etitioners claim that the vault provided -y private respondent ,as not sealed, that is, not ,aterproof. Conse/uently, ,ater seeped throu)h the cement enclosure and dama)ed everythin) inside it. =e do not a)ree. 2here ,as no stipulation in the ?eed of @ale and Certificate of &erpetual Care and in the (ules and (e)ulations of the +anila +emorial &ar. Cemetery, Inc. that the vault ,ould -e ,aterproof. &rivate respondentGs ,itness, +r. ?e<ter *eusch.el, e<plained that the term 0sealed0 meant 0closed.0 9 >n the other hand, the ,ord 0seal0 is defined as . . . any of various closures or fastenin)s . . . that cannot -e opened ,ithout rupture and that serve as a chec. a)ainst tamperin) or unauthorized openin).0 10 2he meanin) that has -een )iven -y private respondent to the ,ord conforms ,ith the cited dictionary definition. +oreover, it is also /uite clear that 0sealed0 cannot -e e/uated ,ith 0,aterproof0. =ell settled is the rule that ,hen the terms of the contract are clear and leave no dou-t as to the intention of the contractin) parties, then the literal meanin) of the stipulation shall control. 11 Contracts should -e interpreted accordin) to their literal meanin) and should not -e interpreted -eyond their o-vious intendment. 12 As ruled -y the respondent Court1 =hen plaintiff-appellant Juan J. @y/uia affi<ed his si)nature to the ?eed of @ale 7'<hi-it 0A0; and the attached (ules and (e)ulations 7'<hi-it 0 0;, it can -e assumed that he has accepted defendant-appelleeGs underta.in) to merely provide a concrete vault. *e can not no, claim that said concrete vault must in addition, also -e ,aterproofed 7sic;. It is -asic that the parties are -ound -y the terms of their contract, ,hich is the la, -et,een them 7(izal Commercial Dan.in) Corporation vs. Court of Appeals, et al. 3$ @C(A 369;. =here there is nothin) in the contract ,hich is contrary to la,, morals, )ood customs, pu-lic order, or pu-lic policy, the validity of the contract must -e sustained 7&hil. American Insurance Co. vs. Jud)e &ineda, 3" @C(A 9 !;. Consonant ,ith this rulin), a contractin) party cannot incur a lia-ility more than ,hat is e<pressly specified in his underta.in). It cannot -e e<tended -y implication, -eyond the terms of the contract 7(izal Commercial Dan.in) Corporation vs. Court of Appeals, supra;. And as a rule of evidence, ,here the terms of an a)reement are reduced to ,ritin), the document itself, -ein)

constituted -y the parties as the e<positor of their intentions, is the only instrument of evidence in respect of that a)reement ,hich the la, ,ill reco)nize, so lon) as its 7sic; e<ists for the purpose of evidence 7@tar.ie, 'v., pp. !9$, !"", Jasheenath vs. Chundy, " =.(. !$ cited in Francisco, (evised (ules of Court in the &hil. p. "6, 936 'd.;. And if the terms of the contract are clear and leave no dou-t upon the intention of the contractin) parties, the literal meanin) of its stipulations shall control 7@antos vs. CA, et al., C. (. #o. $6!!9, #ov. 6, 9$94 &rudential Dan. N 2rust Co. vs. Community Duilders Co., Inc., !" @C(A 2$"4 Dalatero vs. IAC, "9 @C(A "6%;. 13 =e hold, therefore, that private respondent did not -reach the tenor of its o-li)ation to the @y/uias. =hile this may -e so, can private respondent -e lia-le for culpa aquiliana for -orin) the hole on the vaultH It cannot -e denied that the hole made possi-le the entry of more ,ater and soil than ,as natural had there -een no hole. 2he la, defines ne)li)ence as the 0omission of that dili)ence ,hich is re/uired -y the nature of the o-li)ation and corresponds ,ith the circumstances of the persons, of the time and of the place.0 14 In the a-sence of stipulation or le)al provision providin) the contrary, the dili)ence to -e o-served in the performance of the o-li)ation is that ,hich is e<pected of a )ood father of a family. 2he circumstances surroundin) the commission of the assailed act O -orin) of the hole O ne)ate the alle)ation of ne)li)ence. 2he reason for the act ,as e<plained -y *enry Flores, Interment Foreman, ,ho said that1 Q It has -een esta-lished in this particular case that a certain Ficente Juan @y/uia ,as interred on July 2", 93$ at the &araLa/ue Cemetery of the +anila +emorial &ar. Cemetery, Inc., ,ill you please tell the *on. Court ,hat or ,hether you have participation in connection ,ith said internment 7sic;H A A day -efore Juan 7sic; @y/uia ,as -uried our personnel du) a )rave. After di))in) the ne<t mornin) a vault ,as ta.en and placed in the )rave and ,hen the vault ,as placed on the )rave a hole ,as placed on the vault so that ,ater could come into the vault -ecause it was rainin$ heavily then -ecause the vault has no hole the vault ,ill float and the )rave ,ould -e filled ,ith ,ater and the di))in) ,ould caved 7sic; in and the earth, the earth ,ould 7sic; caved in and fill up the )rave. 1/ 7'mphasis ours; '<cept for the foremanGs opinion that the concrete vault may float should there -e a heavy rainfall, from the a-ovementioned e<planation, private respondent has e<ercised the dili)ence of a )ood father of a family in preventin) the accumulation of ,ater inside the vault ,hich ,ould have resulted in the cavin) in of earth around the )rave fillin) the same ,ith earth. 2hus, findin) no evidence of ne)li)ence on the part of private respondent, =e find no reason to a,ard dama)es in favor of petitioners. In the li)ht of the fore)oin) facts, and construed in the lan)ua)e of the applica-le la,s and 5urisprudence, =e are constrained to AFFI(+ in toto the decision of the respondent Court of Appeals dated ?ecem-er 3, 99%. #o costs. @> >(?'('?.

2ERGIO 1. NAG4IAT, doin) -usiness .nd#$ !"# na,# and '!y*# 2ERGIO 1. NAG4IAT ENT., INC., 9 CLAR8 1IELD TA:I, INC., petitioners, vs. #A2I>#AA AAD>( ('AA2I>#@ COMMI22ION ;T+IRD DI-I2ION<, NATIONAL ORGANI7ATION O1 =OR8INGMEN and !' ,#,>#$', LEONARDO T. GALANG, et al., respondents.

Are private respondent-employees of petitioner Clar. Field 2a<i, Inc., ,ho ,ere separated from service due to the closure of Clar. Air Dase, entitled to separation pay and, if so, in ,hat amountH Are officers of corporations ipso facto lia-le 5ointly and severally ,ith the companies they represent for the payment of separation payH 2hese /uestions are ans,ered -y the Court in resolvin) this petition for certiorari under (ule !" of the (ules of Court assailin) the (esolutions of the #ational Aa-or (elations Commission 72hird ?ivision; 8 : promul)ated on Fe-ruary 2$, 999,82: and +ay 6 , 999.86: 2he Fe-ruary 2$, 999 (esolution affirmed ,ith modifications the decision89: of Aa-or Ar-iter Ariel C. @antos in #A(C Case #o. (AD-III- 2-2933-9 . 2he second (esolution denied the motion for reconsideration of herein petitioners. 2he #A(C modified the decision of the la-or ar-iter -y )rantin) separation pay to herein individual respondents in the increased amount of B@P 2%.%% for every year of service or its peso e/uivalent, and holdin) @er)io F. #a)uiat 'nterprises, Inc., @er)io F. #a)uiat and Antolin 2. #a)uiat, 5ointly and severally lia-le ,ith Clar. Field 2a<i, Inc. 70CF2I0;.

T"# 1a%!'

2he follo,in) facts are derived from the records of the case1 &etitioner CF2I held a concessionaireGs contract ,ith the Army Air Force '<chan)e @ervices 70AAF'@0; for the operation of ta<i services ,ithin Clar. Air Dase. @er)io F. #a)uiat ,as CF2IGs president, ,hile Antolin 2. #a)uiat ,as its vice-president. Ai.e @er)io F. #a)uiat 'nterprises, Incorporated 70#a)uiat 'nterprises0;, a tradin) firm, it ,as a family-o,ned corporation. Individual respondents ,ere previously employed -y CF2I as ta<ica- drivers. ?urin) their employment, they ,ere re/uired to pay a daily 0-oundary fee0 in the amount of B@P2!."% for those ,or.in) from 1%% a.m. to 21%% noon, and B@P23.%% for those ,or.in) from 21%% noon to 21%% midni)ht. All incidental e<penses for the maintenance of the vehicles they ,ere drivin) ,ere accounted a)ainst them, includin) )asoline e<penses. 2he drivers ,or.ed at least three to four times a ,ee., dependin) on the availa-ility of ta<ica-s. 2hey earned not less than B@P ".%% daily. In e<cess of that amount, ho,ever, they ,ere re/uired to ma.e cash deposits to the company, ,hich they could later ,ithdra, every fifteen days. ?ue to the phase-out of the B@ military -ases in the &hilippines, from ,hich Clar. Air Dase ,as not spared, the AAF'@ ,as dissolved, and the services of individual respondents ,ere officially terminated on #ovem-er 2!, 99 . 2he AAF'@ 2a<i ?rivers Association 70driversG union0;, throu)h its local president, 'duardo Castillo, and CF2I held ne)otiations as re)ards separation -enefits that should -e a,arded in favor of the drivers. 2hey arrived at an a)reement that the separated drivers ,ill -e )iven &"%%.%% for every year of service as severance pay. +ost of the drivers accepted said amount in ?ecem-er 99 and January 992. *o,ever, individual respondents herein refused to accept theirs. Instead, after disaffiliatin) themselves from the driversG union, individual respondents, throu)h the #ational >r)anization of =or.in)men 70#>=+0;, a la-or or)anization ,hich they su-se/uently 5oined, filed a complaint8": a)ainst 0@er)io F. #a)uiat doin) -usiness under the name and style @er)io F. #a)uiat 'nterprises, Inc., Army-Air Force '<chan)e @ervices 7AAF'@; ,ith +ar. *ooper as Area @ervice +ana)er, &acific (e)ion, and AAF'@ 2a<i ?rivers Association ,ith 'duardo Castillo as &resident,0 for payment of separation pay due to terminationKphase-out. @aid complaint ,as later amended8!: to include additional ta<i drivers ,ho ,ere similarly situated as complainants, and CF2I ,ith Antolin 2. #a)uiat as vice president and )eneral mana)er, as party respondent. In their complaint, herein private respondents alle)ed that they ,ere re)ular employees of #a)uiat 'nterprises, althou)h their individual applications for employment ,ere approved -y CF2I. 2hey claimed to have -een assi)ned to #a)uiat 'nterprises after havin) -een hired -y CF2I, and that the former thence mana)ed, controlled and supervised their employment. 2hey averred further that they ,ere entitled to separation pay -ased on their latest daily earnin)s of B@P ".%% for ,or.in) si<teen 7 !; days a month. In their position paper su-mitted to the la-or ar-iter, herein petitioners claimed that the cessation of -usiness of CF2I on #ovem-er 2!, 99 , ,as due to 0)reat financial losses and lost -usiness opportunity0 resultin) from the phase-out of Clar. Air Dase -rou)ht a-out -y the +t. &inatu-o eruption and the e<piration of the (&-B@ military -ases a)reement. 2hey admitted that CF2I had a)reed ,ith the driversG union, throu)h its &resident 'duardo Castillo ,ho claimed to have had -lan.et authority to ne)otiate ,ith CF2I in -ehalf of union mem-ers, to )rant its ta<i driver-employees separation pay e/uivalent to &"%%.%% for every year of service. 2he la-or ar-iter, findin) the individual complainants to -e re)ular ,or.ers of CF2I, ordered the latter to pay them & ,2%%.%% for every year of service 0for humanitarian consideration,0 settin) aside the earlier a)reement -et,een CF2I and the driversG union of &"%%.%% for every year of service. 2he la-or ar-iter re5ected the alle)ation of CF2I that it ,as forced to close -usiness due to 0)reat financial losses and lost -usiness opportunity0 since, at the time it ceased operations, CF2I ,as profita-ly earnin) and the cessation of its -usiness ,as due to the untimely closure of Clar. Air Dase. In not a,ardin) separation pay in accordance ,ith the Aa-or Code, the la-or-ar-iter e<plained1

02o allo, respondents e<emption from its 7sic; o-li)ation to pay separation pay ,ould -e inhuman to complainants -ut to impose a monetary o-li)ation to an employer ,hose profita-le -usiness ,as a-ruptly shot 7sic; do,n -y force ma5eure ,ould -e unfair and un5ust to say the least.0 83: and thus, simply a,arded an amount for 0humanitarian consideration.0 *erein individual private respondents appealed to the #A(C. In its (esolution, the #A(C modified the decision of the la-or ar-iter -y )rantin) separation pay to the private respondents. 2he concludin) para)raphs of the #A(C (esolution read1 02he contention of complainant is partly correct. >ne-half month salary should -e B@P 2%.%% -ut this amount can not -e paid to the complainant in B.@. ?ollar ,hich is not the le)al tender in the &hilippines. &aras, in commentin) on Art. 299 of the #e, Civil Code, defines le)al tender as Gthat ,hich a de-tor may compel a creditor to accept in payment of the de-t. 2he complainants ,ho are the creditors in this instance can -e compelled to accept the &hilippine peso ,hich is the le)al tender, in ,hich case, the ta-le of conversion 7e<chan)e rate; at the time of payment or satisfaction of the 5ud)ment should -e used. *o,ever, since the choice is left to the de-tor, 7respondents; they may choose to pay in B@ dollar.G 7&hoeni< Assurance Co. vs. +acondray N Co. Inc., A-2"%9$, +ay 6, 93"; In dischar)in) the a-ove o-li)ations, @er)io F. #a)uiat 'nterprises, ,hich is headed -y @er)io F. #a)uiat and Antolin #a)uiat, father and son at the same time the &resident and Fice-&resident and Ceneral +ana)er, respectively, should -e 5oined as indispensa-le party ,hose lia-ility is 5oint and several. 7@ec. 3, (ule 6, (ules of Court;08$: As mentioned earlier, the motion for reconsideration of herein petitioners ,as denied -y the #A(C. *ence, this petition ,ith prayer for issuance of a temporary restrainin) order. Bpon postin) -y the petitioners of a surety -ond, a temporary restrainin) order89: ,as issued -y this Court en5oinin) e<ecution of the assailed (esolutions.

I''.#'

2he petitioners raise the follo,in) issues -efore this Court for resolution1 0I. =hether or not pu-lic respondent #A(C 76rd ?iv.; committed )rave a-use of discretion amountin) to lac. of 5urisdiction in issuin) the appealed resolution4 II. =hether or not +essrs. 2eofilo (afols and (omeo #. Aopez could validly represent herein private respondents4 and, III. =hether or not the resolution issued -y pu-lic respondent is contrary to la,.08
%:

&etitioners also su-mit t,o additional issues -y ,ay of a supplement 8 : to their petition, to =it1 that &etitioners @er)io F. #a)uiat and Antolin #a)uiat ,ere denied due process4 and that petitioners ,ere not furnished copies of private respondentsG appeal to the #A(C. As to the procedural lapse of insufficient copies of the appeal, the proper forum -efore ,hich petitioners should have raised it is the #A(C. 2hey, ho,ever, failed to /uestion this in their motion for reconsideration. As a conse/uence, they are deemed to have ,aived the same and voluntarily su-mitted themselves to the 5urisdiction of the appellate -ody. Anent the first issue raised in their ori)inal petition, petitioners contend that #A(C committed )rave a-use of discretion amountin) to lac. or e<cess of 5urisdiction in unilaterally increasin) the amount of severance pay )ranted -y the la-or ar-iter. 2hey claim that this ,as not supported -y su-stantial evidence since it ,as -ased simply on the self-servin) alle)ation of respondents that their monthly ta.e-home pay ,as not lo,er than P29%.%%. >n the second issue, petitioners aver that #>=+ cannot ma.e le)al representations in -ehalf of individual respondents ,ho should, instead, -e -ound -y the decision of the union 7AAF'@ 2a<i ?rivers Association; of ,hich they ,ere mem-ers. As to the third issue, petitioners incessantly insist that @er)io F. #a)uiat 'nterprises, Inc. is a separate and distinct 5uridical entity ,hich cannot -e held 5ointly and severally lia-le for the o-li)ations of CF2I. And similarly, @er)io F. #a)uiat and Antolin #a)uiat ,ere merely officers and stoc.holders of CF2I and, thus, could not -e held personally accounta-le for corporate de-ts. Aastly, @er)io and Antolin #a)uiat assail the (esolution of #A(C holdin) them solidarily lia-le despite not havin) -een impleaded as parties to the complaint. Individual respondents filed a comment separate from that of #>=+. In sum, -oth aver that petitioners had the opportunity -ut failed to refute, the ta<i driversG claim of havin) an avera)e monthly earnin) of P29%.%%4 that individual respondents -ecame mem-ers of #>=+ after disaffiliatin) themselves from the AAF'@ 2a<i ?rivers Association ,hich, throu)h the manipulations of its &resident 'duardo Castillo, unconsciona-ly compromised their separation pay4 and that #a)uiat 'nterprises, -ein) their indirect employer, is solidarily lia-le under the la, for violation of the Aa-or Code, in this case, for nonpayment of their separation pay. 2he @olicitor Ceneral un/ualifiedly supports the alle)ations of private respondents. In addition, he su-mits that the separate personalities of respondent corporations and their officers should -e disre)arded and considered one and the same as these ,ere used to perpetrate in5ustice to their employees.

T"# Co.$!?' R.* n)

As ,ill -e discussed -elo,, the petition is partially meritorious.

1 $'! I''.#@ Amount of Separation Pay

Firmly, ,e reiterate the rule that in a petition for certiorari filed pursuant to (ule !" of the (ules of Court, ,hich is the only ,ay a la-or case may reach the @upreme Court, the petitionerKs must clearly sho, that the #A(C acted ,ithout or in e<cess of 5urisdiction or ,ith )rave a-use of discretion. 8 2: Aon)-standin) and ,ell-settled in &hilippine 5urisprudence is the 5udicial dictum that findin)s of fact of administrative a)encies and /uasi-5udicial -odies, ,hich have ac/uired e<pertise -ecause their 5urisdiction is confined to specific matters, are )enerally accorded not only )reat respect -ut even finality4 and are -indin) upon this Court unless there is a sho,in) of )rave a-use of discretion, or ,here it is clearly sho,n that they ,ere arrived at ar-itrarily or in disre)ard of the evidence on record.8 6: #evertheless, this Court carefully perused the records of the instant case if only to determine ,hether pu-lic respondent committed )rave a-use of discretion, amountin) to lac. of 5urisdiction, in )rantin) the clamor of private respondents that their separation pay should -e -ased on the amount of P29%.%%, alle)edly their minimum monthly earnin)s as ta<i drivers of petitioners. In their amended complaint -efore the (e)ional Ar-itration Dranch in @an Fernando, &ampan)a, herein private respondents set forth in detail the ,or. schedule and financial arran)ement they had ,ith their employer. 2herefrom they inferred that their monthly ta.e-home pay amounted to not less than P29%.%%. *erein petitioners did not -other to refute nor offer any evidence to controvert said alle)ations. (emainin) undisputed, the la-or ar-iter adopted such facts in his decision. &etitioners did not even appeal from the decision of the la-or ar-iter nor manifest any error in his findin)s and conclusions. 2hus, petitioners are in estoppel for not havin) /uestioned such facts ,hen they had all opportunity to do so. &rivate respondents, li.e petitioners, are -ound -y the factual findin)s of (espondent Commission. &etitioners also claim that the closure of their ta<i -usiness ,as due to )reat financial losses -rou)ht a-out -y the eruption of +t. &inatu-o ,hich made the roads practically impassa-le to their ta<ica-s. Ai.e,ise ,ell-settled is the rule that -usiness losses or financial reverses, in order to sustain retrenchment of personnel or closure of -usiness and ,arrant e<emption from payment of separation pay, must -e proved ,ith clear and satisfactory evidence.8 9: 2he records, ho,ever, are devoid of such evidence. 2he la-or ar-iter4 as affirmed -y #A(C, correctly found that petitioners stopped their ta<i -usiness ,ithin Clar. Air Dase -ecause of the phase-out of B.@. military presence thereat. It ,as not due to any )reat financial loss -ecause petitionersG ta<i -usiness ,as earnin) profita-ly at the time of its closure. =ith respect to the amount of separation pay that should -e )ranted, Article 2$6 of the Aa-or Code provides1 0< < < In case of retrenchment to prevent losses and in cases of closures or cessation of operations of esta-lishment or underta.in) not due to serious -usiness losses or financial reverses, the separation pay shall -e e/uivalent to one 7 ; month pay or at least one-half 7Q; month pay for every year of service, ,hichever is hi)her. A fraction of at least si< 7!; months shall -e considered one 7 ; ,hole year.0 Considerin) the a-ove, ,e find that #A(C did not commit )rave a-use of discretion in rulin) that individual respondents ,ere entitled to separation pay 8 ": in the amount P 2%.%% 7one-half of P29%.%% monthly pay; or its peso e/uivalent for every year of service. 2#%ond I''.#@ NOWM's Personality to Represent Individual Respondents !mployees

>n the /uestion of #>=+Gs authority to represent private respondents, ,e hold petitioners in estoppel for not havin) seasona-ly raised this issue -efore the la-or ar-iter or the #A(C. #>=+ ,as already a party-liti)ant as the or)anization representin) the ta<i driver-complainants -efore the la-or ar-iter. Dut petitioners ,ho ,ere partyrespondents in said complaint did not assail the 5uridical personality of #>=+ and the validity of its representations in -ehalf of the complainin) ta<i drivers -efore the /uasi-5udicial -odies. 2herefore, they are no, estopped from raisin) such /uestion -efore this Court. In any event, petitioners ac.no,led)ed -efore this Court that the ta<i drivers alle)edly represented -y #>=+, are themselves parties in this case.8 !:

T" $d I''.#@ "ia#ility of Petitioner $orporations and %&eir Respe'tive Offi'ers

2he resolution of this issue involves another factual findin) that #a)uiat 'nterprises actually mana)ed, supervised and controlled employment terms of the ta<i drivers, ma.in) it their indirect employer. As adverted to

earlier, factual findin)s of /uasi-5udicial -odies are -indin) upon the court in the a-sence of a sho,in) of )rave a-use of discretion. Bnfortunately, the #A(C did not discuss or )ive any e<planation for holdin) #a)uiat 'nterprises and its officers 5ointly and severally lia-le in dischar)in) CF2IGs lia-ility for payment of separation pay. =e a)ain remind those concerned that decisions, ho,ever concisely ,ritten, must distinctly and clearly set forth the facts and la, upon ,hich they are -ased.8 3: 2his rule applies as ,ell to dispositions -y /uasi-5udicial and administrative -odies.

Na(uiat !nterprises Not "ia#le

%!,8

$:

In impleadin) #a)uiat 'nterprises as solidarily lia-le for the o-li)ations of CF2I, respondents rely on Articles %38 9: and %982%: of the Aa-or Code.

Dased on factual su-missions of the parties, the la-or ar-iter, ho,ever, found that individual respondents ,ere re)ular employees of CF2I ,ho received ,a)es on a -oundary or commission -asis. =e find no reason to ma.e a contrary findin). Aa-or-only contractin) e<ists ,here1 7 ; the person supplyin) ,or.ers to an employer does not have su-stantial capital or investment in the form of tools, e/uipment, machinery, and ,or. premises, amon) others4 and 72; the ,or.ers recruited and placed -y such person are performin) activities ,hich are directly related to the principal -usiness of the employer. 82 : Independent contractors, mean,hile, are those ,ho e<ercise independent employment, contractin) to do a piece of ,or. accordin) to their o,n methods ,ithout -ein) su-5ect to control of their employer e<cept as to the result of their ,or..822: From the evidence proffered -y -oth parties, there is no su-stantial -asis to hold that #a)uiat 'nterprises is an indirect employer of individual respondents much less a la-or only contractor. >n the contrary, petitioners su-mitted documents such as the driversG applications for employment ,ith CF2I,826: and social security remittances829: and payroll82": of #a)uiat 'nterprises sho,in) that none of the individual respondents ,ere its employees. +oreover, in the contract82!: -et,een CF2I and AAF'@, the former, as concessionaire, a)reed to purchase from AAF'@ for a certain amount ,ithin a specified period a fleet of vehicles to -e 0.e7pt; on the road0 -y CF2I, pursuant to their concessionaireGs contract. 2his indicates that CF2I -ecame the o,ner of the ta<ica-s ,hich -ecame the principal investment and asset of the company. &rivate respondents failed to su-stantiate their claim that #a)uiat 'nterprises mana)ed, supervised and controlled their employment. It appears that they ,ere confused on the personalities of @er)io F. #a)uiat as an individual ,ho ,as the president of CF2I, and @er)io F. #a)uiat 'nterprises, Inc., as a separate corporate entity ,ith a separate -usiness. 2hey presumed that @er)io F. #a)uiat, ,ho ,as at the same time a stoc.holder and director823: of @er)io F. #a)uiat 'nterprises, Inc., ,as mana)in) and controllin) the ta<i -usiness on -ehalf of the latter. A closer scrutiny and analysis of the records, ho,ever, evince the truth of the matter1 that @er)io F. #a)uiat, in supervisin) the-ta<i drivers and determinin) their employment terms, ,as rather carryin) out his responsi-ilities as president of CF2I. *ence, #a)uiat 'nterprises as a separate corporation does not appear to -e involved at all in the ta<i -usiness. 2o illustrate further, ,e refer to the testimony of a driver-claimant on cross e<amination. 0Atty. @uarez Is it not true that you applied not ,ith @er)io F. #a)uiat -ut ,ith Clar. Field 2a<iH =itness I applied for 7sic; @er)io F. #a)uiat Atty. @uarez @er)io F. #a)uiat as an individual or the corporationH =itness G@er)io F. #a)uiat na tao.G Atty. @uarez =ho is @er)io F. #a)uiatH =itness *e is the one mana)in) the @er)io F. #a)uiat 'nterprises and he is the one ,hom ,e -elieve as our employer. Atty. @uarez =hat is e<actly the position of @er)io F. #a)uiat ,ith the @er)io F. #a)uiat 'nterprisesH =itness *e is the o,ner, sir.

Atty. @uarez *o, a-out ,ith Clar. Field 2a<i Incorporated ,hat is the position of +r. #a)uiatH =itness =hat I .no, is that he is a concessionaire. <<< Atty. @uarez Dut do you also .no, that @er)io F. #a)uiat is the &resident of Clar. Field 2a<i, IncorporatedH =itness Ees. sir. Atty. @uarez *o, a-out +r. Antolin #a)uiat ,hat is his role in the ta<i services, the operation of the Clar. Field 2a<i, IncorporatedH =itness *e is the vice president.082$: And, althou)h the ,itness insisted that #a)uiat 'nterprises ,as his employer, he could not deny that he received his salary from the office of CF2I inside the -ase.829: Another driver-claimant admitted, upon the proddin) of counsel for the corporations, that #a)uiat 'nterprises ,as in the tradin) -usiness ,hile CF2I ,as in ta<i services. 86%: In addition, the Constitution86 : of CF2I-AAF'@ 2a<i ?rivers Association ,hich, admittedly, ,as the union of individual respondents ,hile still ,or.in) at Clar. Air Dase, states that mem-ers thereof are the employees of CF2I and 07f;or collective -ar)ainin) purposes, the definite employer is the Clar. Field 2a<i Inc.0 From the fore)oin), the ineludi-le conclusion is that CF2I ,as the actual and direct employer of individual respondents, and that #a)uiat 'nterprises ,as neither their indirect employer nor la-or-only contractor. It ,as not involved at all in the ta<i -usiness. <<< <<<

$)%I president solidarily lia#le

&etitioner-corporations ,ould li.e,ise ,ant to avoid the solidary lia-ility of their officers. 2o -olster their position, @er)io F. #a)uiat and Antolin 2. #a)uiat specifically aver that they ,ere denied due process since they ,ere not parties to the complaint -elo,.862: In the -roader interest of 5ustice, ,e, ho,ever, hold that @er)io F. #a)uiat, in his capacity as president of CF2I, cannot -e e<onerated from 5oint and several lia-ility in the payment of separation pay to individual respondents. !.#. Ransom (abor Union-##(U vs. )(R# 866: is the case in point. A.C. (ansom Corporation ,as a family corporation, the stoc.holders of ,hich ,ere mem-ers of the *ernandez family. In 936, it filed an application for clearance to close or cease operations, ,hich ,as duly )ranted -y the +inistry of Aa-or and 'mployment, ,ithout pre5udice to the ri)ht of employees to see. redress of )rievance, if any. Dac.,a)es of 22 employees, ,ho en)a)ed in a stri.e prior to the closure, ,ere su-se/uently computed at & !9,9$9.%%. Bp to @eptem-er 93!, the union filed a-out ten 7 %; motions for e<ecution a)ainst the corporation, -ut none could -e implemented, presuma-ly for failure to find levia-le assets of said corporation. In its last motion for e<ecution, the union as.ed that officers and a)ents of the company -e held personally lia-le for payment of the -ac.,a)es. 2his ,as )ranted -y the la-or ar-iter. In the corporationGs appeal to the #A(C, one of the issues raised ,as1 0Is the 5ud)ment a)ainst a corporation to reinstate its dismissed employees ,ith -ac.,a)es, enforcea-le a)ainst its officer and a)ents, in their individual, private and personal capacities, ,ho ,ere not parties in the case ,here the 5ud)ment ,as renderedH0 2he #A(C ans,ered in the ne)ative, on the )round that officers of a corporation are not lia-le personally for official acts unless they e<ceeded the scope of their authority. >n certiorari, this Court reversed the #A(C and upheld the la-or ar-iter. In imposin) 5oint and several lia-ility upon the company president, the Court, spea.in) throu)h +me. Justice Ameurfina +elencio-*errera, ratiocinated this ,ise1 07-; *o, can the fore)oin) 7Articles 2!" and 236 of the Aa-or Code; provisions -e implemented ,hen the employer is a corporationH 2he ans,er is found in Article 2 27c; of the Aa-or Code ,hich provides1 G7c; G'mployerG includes any person actin$ in the interest of an employer' directly or indirectly. 2he term shall not include any la-or or)anization or any of its officers or a)ents e<cept ,hen actin) as employer.G

2he fore)oin) ,as culled from @ection 2 of (A !%2, the +inimum =a)e Aa,. @ince (A#@>+ is an artificial person, it must have an officer ,ho can -e presumed to -e the employer, -ein) the Gperson actin) in the interest of 7the; employerG (A#@>+. 2he corporation, only in the technical sense, is the employer. 2he responsi-le officer of an employer corporation can -e held personally, not to say even criminally, lia-le for nonpayment of -ac. ,a)es. 2hat is the policy of the la,. < < < 7c; If the policy of the la, ,ere other,ise, the corporation employer can have devious ,ays for evadin) payment of -ac. ,a)es. < < < 7d; 2he record does not clearly identify Gthe officer or officersG of (A#@>+ directly responsi-le for failure to pay the -ac. ,a)es of the 22 stri.ers. In the a-sence of definite proof in that re)ard, ,e -elieve it should -e presumed that the responsi-le officer is the &resident of the corporation ,ho can -e deemed the chief operation officer thereof. 2hus, in (A !%2, criminal responsi-ility is ,ith the *+ana$er or in his default, the person actin) as such.G In (A#@>+, the &resident appears to -e the +ana)er.0 7Bnderscorin) supplied.; @er)io F. #a)uiat, admittedly, ,as the president of CF2I ,ho actively mana)ed the -usiness. 2hus, applyin) the rulin) in !. #. Ransom, he falls ,ithin the meanin) of an 0employer0 as contemplated -y the Aa-or Code, ,ho may -e held 5ointly and severally lia-le for the o-li)ations of the corporation to its dismissed employees. +oreover, petitioners also conceded that -oth CF2I and #a)uiat 'nterprises ,ere 0close family corporations0869: o,ned -y the #a)uiat family. @ection %%, para)raph ", 7under 2itle III on Close Corporations; of the Corporation Code, states1 07"; 2o the e<tent that the stoc.holders are actively en)a)e7d; in the mana)ement or operation of the -usiness and affairs of a close corporation, the stoc.holders shall -e held to strict fiduciary duties to each other and amon) themselves. @aid stoc.holders shall -e personally lia-le for corporate torts unless the corporation has o-tained reasona-ly ade/uate lia-ility insurance.0 7underscorin) supplied; #othin) in the records sho, ,hether CF2I o-tained 0reasona-ly ade/uate lia-ility insurance40 thus, ,hat remains is to determine ,hether there ,as corporate tort. >ur 5urisprudence is ,antin) as to the definite scope of 0corporate tort.0 'ssentially, 0tort0 consists in the violation of a ri)ht )iven or the omission of a duty imposed -y la,. 86": @imply stated, tort is a -reach of a le)al duty. 86!: Article 2$6 of the Aa-or Code mandates the employer to )rant separation pay to employees in case of closure or cessation of operations of esta-lishment or underta.in) not due to serious -usiness losses or financial reverses, ,hich is the condition o-tainin) at -ar. CF2I failed to comply ,ith this la,-imposed duty or o-li)ation. Conse/uently, its stoc.holder ,ho ,as actively en)a)ed in the mana)ement or operation of the -usiness should -e held personally lia-le. Furthermore, in +!+ Realty ,evelopment vs. )(R#,863: the Court reco)nized that a director or officer may still -e held solidarily lia-le ,ith a corporation -y specific provision of la,. 2hus1 0< < < A corporation, -ein) a 5uridical entity, may act only throu)h its directors, officers and employees. >-li)ations incurred -y them, actin) as such corporate a)ents, are not theirs -ut the direct accounta-ilities of the corporation they represent. 2rue, solidary lia-ilities may at times -e incurred -ut only ,hen e<ceptional circumstances ,arrant such as, )enerally, in the follo,in) cases1 @cl-a, <<< <<< <<<

9. =hen a director, trustee or officer is made, -y specific provision of la,, personally lia-le for his corporate action.0 7footnotes omitted; As pointed out earlier, the fifth para)raph of @ection %% of the Corporation Code specifically imposes personal lia-ility upon the stoc.holder actively mana)in) or operatin) the -usiness and affairs of the close corporation. In fact, in postin) the surety -ond re/uired -y this Court for the issuance of a temporary restrainin) order en5oinin) the e<ecution of the assailed #A(C (esolutions, only @er)io F. #a)uiat, in his individual and personal capacity, principally -ound himself to comply ,ith the o-li)ation thereunder, i.e., 0to )uarantee the payment to private respondents of any dama)es ,hich they may incur -y reason of the issuance of a temporary restrainin) order sou)ht, if it should -e finally ad5ud)ed that said principals ,ere not entitled thereto.086$: 2he Court here finds no application to the rule that a corporate officer cannot -e held solidarily lia-le ,ith a corporation in the a-sence of evidence that he had acted in -ad faith or ,ith malice. 869: In the present case, @er)io #a)uiat is held solidarily lia-le for corporate tort -ecause he had actively en)a)ed in the mana)ement and operation of CF2I, a close corporation.

Antolin Na(uiat not personally lia#le

Antolin 2. #a)uiat ,as the vice president of the CF2I. Althou)h he carried the title of 0)eneral mana)er0 as ,ell, it had not -een sho,n that he had acted in such capacity. Furthermore, no evidence on the e<tent of his participation in the mana)ement or operation of the -usiness ,as proffered. In this li)ht, he cannot -e held solidarily lia-le for the o-li)ations of CF2I and @er)io #a)uiat to the private respondents.

1o.$!" I''.#: No *enial of *ue Pro'ess

Aastly, in petitionersG @upplement to their ori)inal petition, they assail the #A(C (esolution holdin) @er)io F. #a)uiat and Antolin 2. #a)uiat 5ointly and severally lia-le ,ith petitioner-corporations in the payment of separation pay, averrin) denial of due process since the individual #a)uiats ,ere not impleaded as parties to the complaint. =e advert to the case of !.#. Ransom once more. 2he officers of the corporation ,ere not parties to the case ,hen the 5ud)ment in favor of the employees ,as rendered. 2he corporate officers raised this issue ,hen the la-or ar-iter )ranted the motion of the employees to enforce the 5ud)ment a)ainst them. In spite of this, the Court held the corporation president solidarily lia-le ,ith the corporation. Furthermore, @er)io and Antolin #a)uiat voluntarily su-mitted themselves to the 5urisdiction of the la-or ar-iter ,hen they, in their individual capacities, filed a position paper 89%: to)ether ,ith CF2I, -efore the ar-iter. 2hey cannot no, claim to have -een denied due process since they availed of the opportunity to present their positions. =+ERE1ORE, the fore)oin) premises considered, the petition is &A(2AE C(A#2'?. 2he assailed Fe-ruary 2$, 999 (esolution of the #A(C is here-y +>?IFI'? as follo,s1 7 ; &etitioner Clar. Field 2a<i, Incorporated, and @er)io F. #a)uiat, president and co-o,ner thereof, are -R,.R., to pay, 5ointly and severally, the individual respondents their separation pay computed at B@P 2%.%% for every year of service, or its peso e/uivalent at the time of payment or satisfaction of the 5ud)ment4 72; &etitioner @er)io F. #a)uiat 'nterprises, Incorporated, and Antolin 2. #a)uiat are !B&-(/., from lia-ility in the payment of separation pay to individual respondents. 2O ORDERED.