TABLE OF CONTENTS

I. Negligence 1 Professional Services Inc. v Agana

Professional Services vs. Agana (Captain of the Ship Doctrine) Facts: Dr. Ampil (did anterior resection surgery) and Dr. Fuentes (did only hysterectomy) of Medical City operated on Natividad Agana. The operation was flawed, because the nurse recorded that two sponges were lacking despite her announcing this to the surgeon ("announced to surgeon, searched done but to no avail continue for closure). Because Natividad continued experiencing pain in her anal region, she consulted Dr Ampil and Dr Fuentes about it. Dr Ampil said that the pain is a natural consequence of the surgery. Dr Ampil further told her that the pain would later subside. Natividad went to the US to seek further treatment, but to no avail. She returned to the PH. Later her daughter removed a piece of gauze from her protruding from her vagina. Natividad sought more treatment from Polymedic General Hospital, where Dr Gutierrez detected another foreign object in her vagina, a gauze, and that another surgical operation needed to be done to her to remedy the damage to her. Thus, she and her husband filed a complaint for damages vs the owner of Medical City (Professional Services Inc.), Dr Ampil and Dr Fuentes, alleging negligence for leaving 2 pieces of gauze inside her body and concealing their acts of negligence. Her husband Enrique also filed with the PRC an admin complaint vs the two doctors for gross negligence and malpractice. These were later consolidated. RTC found for the Aganas, CA affirmed. Hence this petition. Issues/Held: 1. Liability of the Surgeon--Dr. Ampil is the negligent party. The surgeons used gauzes as sponges to control the bleeding, and immediately thereafter the nurses who assisted noted in their report that the sponge was lacking, and that such anomaly was announced to surgeon but to no avail. Later, 2 gauzes were extracted from the same spot of Natividads body. Dr. Ampil did not inform Natividad about the missing two pieces of gauze. Worse, he even misled her that the pain she was experiencing was the ordinary consequence of her operation. Had he been more candid, Natividad could have taken the immediate and appropriate medical remedy to remove the gauzes from her body. To our mind, what was initially an act of negligence by Dr. Ampil has ripened into a deliberate wrongful act of deceiving his patient. 2. Liability of Dr. Fuentes--Dr Fuentes is cleared of any liability. It was duly established that Dr. Ampil was the lead surgeon (hence, captain of the ship) during the operation of Natividad. He requested the assistance of Dr. Fuentes only to perform hysterectomy when 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. Under the "Captain of the Ship" rule, the operating surgeon is the person in complete charge of the surgery room and all personnel connected with the operation. Their duty is to obey his orders.16 As stated before, Dr. Ampil was the lead surgeon. In other words, he was the "Captain of the Ship." That he discharged such role is evident from his following conduct: (1) calling Dr. Fuentes to perform a hysterectomy; (2) examining the work of Dr. Fuentes and finding it in order; (3) granting Dr. Fuentes permission to leave; and (4) ordering the closure of the incision. To our mind, it was this act of ordering the closure of the incision notwithstanding that two pieces of gauze remained unaccounted for, that caused injury to Natividads body. Clearly, the control and management of the thing which caused the injury was in the hands of Dr. Ampil, not Dr. Fuentes. 3. Liability of the hospital--PSI liable. 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, visiting or attending, are required to submit proof of completion of residency, their educational qualifications, generally, evidence of accreditation by the appropriate board (diplomate), evidence of fellowship in most cases, and references. These requirements are carefully scrutinized by members of the hospital administration or by a review committee set up by the hospital who either accept or reject the application. Private hospitals, hire, fire and exercise real control over their attending and visiting consultant staff. While consultants are not, technically employees, x x x, the control exercised, 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.
Orlando Garcia Jr. (Community Diagnostic Center) v Salvador 2

GARCIA, JR. (COMMUNITY DIAGNOSTIC CENTER) vs. SALVADOR G.R. No. 168512. March 20, 2007 YNARES-SANTIAGO, J. FACTS: Ranida Salvador, a trainee in the Limay Bulk Handling Terminal Inc. (LBHTI) underwent a medical exam at Community Diagnostic Center (CDC) as a prerequisite to regular employment. The test result showed that she was HBs Ag: Reactive or Hepa B positive, so she was terminated from her job. Her father Ramon upon learning about her state of health suffered a heart attack and had to be hospitalized at Bataan Doctors Hospital (BDH). Ranida took another HBs Ag test at the BDH, which showed that shes non-reactive so she returned to LBHTI to get her job back but the company doctor advised her to have a confirmatory test at CDC using the Micro-Elisa Method. The test at the CDC indicated a negative result. Ranida also underwent another HBs Ag test at the Bataan Doctors Hospital using the Micro-Elisa Method and the result indicated that she was non-reactive. After submitting the two results to LBHTI, she was rehired. Ranida filed a complaint for damages for gross negligence and incompetence against the examining medical technologist Garcia and pathologist Castro for the erroneous

interpretation of the results. The RTC dismissed the complaint for insufficiency of evidence but the CA reversed ordering Garcia to pay moral & exemplary damages & attorneys fees and exonerated Castro for lack of participation in the issuance of the results. ISSUE: Is petitioner liable for damages to the respondents for issuing an incorrect HBs AG test result? HELD: YES. Negligence is the failure to observe for the protection of the interest of another person that degree of care, precaution and vigilance which the circumstances justly demand, whereby such other person suffers injury. The elements of an actionable conduct are: 1) duty, 2) breach, 3) injury, and 4) proximate causation which are all present in the case at bar. Ranida suffered injury as a direct consequence of Garcias failure to comply with the mandate of the laws and rules. She was terminated from the service for failing the physical examination; suffered anxiety because of the diagnosis; and was compelled to undergo several more tests. All these could have been avoided had the proper safeguards been scrupulously followed in conducting the clinical examination and releasing the clinical report. The legal basis for the award of damages to a party who suffers damage whenever one commits an act in violation of some legal provision is provided in Article 20 of the New Civil Code. The Court affirmed the decision of the CA finding Garcia guilty of gross negligence and liable to pay respondents P50K moral damages, P50K exemplary damages and P25K attorneys fees.
Cantre v Sps Go 3

Cantre versus Spouses John David Go and Nora Go G.R. No. 160889, April 27, 2007 Ponente: Quisimbing, J. Facts: Dr. Milagros L. Cantre is a specialist in Ob-Gyn at the Dr. Jesus Delgado Memorial Hospital. She attended to Nora Go, who was admitted at the said hospital on 19 April 1992. When Nora gave birth to her 4th son, she suffered profuse bleeding inside her womb due to some parts of the placenta which were not completely expelled from her womb after delivery. She then suffere hypovolemic shock, resulting to low blood pressure. One of the medical procedures to treat her was the use of droplight to warm Nora and her baby. John Go, Nora's husband, saw that there was a wound in the left arm of Nora. John asked the nurses what had caused the wound and was told that it was a burn. However, D. Cantre said that the blood pressure cuff caused the injury. When John David brought Nora to the NBI, the medico-legal officer testified that the injury was a burn caused by a droplight. Spouses Go filed a complaint for recovery for damages due to negligence against Dr. Cantre. The trial court awarded the damages. The Court of Appeals affirmed the decision. Issue: Whether Dr. Cantre and the hospital are liable for the injury. Held: Yes. Following the "captain of the ship" principle, Dr. Cantre is responsible for any injuries that arise due to negligence even one by his medical staff. Whether the injury was

caused by the blood pressure cuff or by the droplight, petitioner was still negligent in her duties as Nora's attending physician. Intent is immaterial in negligence cases because where negligence exists and is proven, it automatically gives the injured right to reparation for the damage caused. In cases involving medical negligence, the doctrine of res ipsa loquitur allows the mere existence of an injury to justify presumption of negligence. The requisites are: 1. The accident is of a kind which ordinarily does not occur in the absence of someone's negligence; 2. It is caused by an instrumentality within the excluive control of the defendant.; and 3. The possibility of contributing conduct which would make the plaintiff responsible is eliminated. As to the first requisite, the gaping wound on Nora's arm is certainly not an ordinary occurrence in the act of delivering a baby, far removed from the organs involve in the process of giving birth. As to the second requisite, both the droplight and the blood pressure cuff are within the exclusive control of the physician in charge under the captain of the ship doctrine. As to the third requisite, the gaping wound on Nora's arm, by its nature could only be caused by something external to her and outside her control as she was unconscious while in hypovolemic shoch. Hence, she could not have contributed to her own injury. Thus, Dr. Cantre and the hospital are obliged to pay Nora for moral damages suffered as a proximate result of Dr. Cantre's negligence.
Filinvest Land Inc. v Flood-affected Homeowners of Meritville Alliance 4

Filinvest Land Inc. v. Flood-Affected Homeowners of Meritville Alliance Gr. No. 165955, August 10, 2007 Sandoval- Gutierrez, J. Facts: Filinvest Land, Inc has developed a subdivision called Meritville Townhouse Subdivision (Meritville), the first low-cost townhouse project in Pulang Lupa, Las Pias City. The project site is located near the heavily-silted Naga River. Respondents herein, who purchased their housing units from petitioner, are fifty-four (54) of the residents of Meritville. Subsequently, the area around Meritville was developed. New subdivisions were built with elevations higher than that of Meritville. This development turned Meritville into a catch basin from rains during the wet season and from water coming from the Naga River every time it overflows. Respondents suffered damages on their townhouses during the floods on August, 1993 and March and August, 1994. To remedy the problem, petitioner installed a pumping station and improved the drainage system but these remedies were not enough. On June 15, 1996, respondents filed with the Housing and Land Use Regulatory Board (HLURB) a complaint against petitioner, praying that petitioner be ordered to transfer them to its other flood-free housing projects, allowing them to sell-back their affected units. The HLURB Arbiter, found that petitioner was negligent in preventing the flooding. The HLURB Board of Commissioners affirmed the

Arbiters findings, which was later affirmed in subsequent appeals before the Office of the President and the Court of Appeals. Issue: Whether petitioners negligence caused the flooding in Meritville. Held: No, the Court held that petitioner was not negligent. First, it is not disputed that the Meritville is the first subdivision to be developed in the locality and that subsequent developments elevated the surrounding areas to a level higher by more than one meter than that of Meritville. Naturally, the water from these surrounding areas would flow to the lower area which is Meritville. It has to be emphasized that prior to these developments, there was no flooding in the subdivision. Second, Article 502 of the Civil Code provides that rivers and their natural bed are of public dominion. As Naga River is a public property, hence, it is the government which should address the problem. Under Sec. 3 of RA 7974 and Sec.17 of the Local Government Code, the provisions state that a city should provide among its basic services drainage and sewerage and flood control management. Thus, it is the City Government of Las Pias City which has the duty to control the flood in Meritville.
Corinthian Gardens Association Inc. v Sps Reynaldo and Maria Luisa Tanjangco 5

CORINTHIAN GARDENS ASSOCIATION, INC., petitioner, vs. SPOUSES REYNALDO and MARIA LUISA TANJANGCO, and SPOUSES FRANK and TERESITA CUASO, respondent. GR 160795 June 27, 2008 FACTS: Respondents-spouses Tanjangco own Lots 68 and 69 located at Corinthian Gardens Subdivision, Quezon City, which is managed by petitioner Corinthian Gardens Association, Inc. (Corinthian). On the other hand, respondents-spouses Cuaso own Lot 65 which is adjacent to the Tanjangcos lots. Before the Cuasos constructed their house on Lot 65, a relocation survey was necessary. Corinthian referred Engr. De Dios to the Cuasos. Before, during and after the construction of the said house, Corinthian conducted periodic ocular inspections in order to determine compliance with the approved plans. Unfortunately, after the Cuasos constructed their house employing the services of C.B. Paraz & Construction Co., Inc. (C.B. Paraz) as builder, their perimeter fence encroached on the Tanjangcos Lot 69 by 87 square meters. ISSUE: Whether Corinthian should be held liable to pay 5% of the judgment money to Spouses Tanjangco on account of the encroachment made by Spouses Cuaso. HELD: Yes, Corinthian is negligent. Corinthian cannot and should not be allowed to justify or excuse its negligence by claiming that its approval of the Cuasos building plans was only limited to a so-called "table inspection;" and not actual site measurement. To accept some such

postulate is to put a premium on negligence. Corinthian was not organized solely for the defendants Cuasos. It is also the subdivision of the plaintiffs-spouses Tanjangcos - and of all others who have their dwelling units or abodes therein. Pertinently, its Manual of Rules and Regulations stipulates in Section 3 thereof that, No new construction can be started unless the building plans are approved by the Association x x x. The payment by the Cuasos to Corinthian of pre-construction and membership fees in the Association must necessarily entail the creation of certain obligations on the part of Corinthian. For duties and responsibilities always go hand in hand with rights and privileges. In sum, Corinthians failure to prevent the encroachment of the Cuasos perimeter wall into Tanjangcos property despite the inspection conducted constitutes negligence and, at the very least, contributed to the injury suffered by the Tanjangcos.
National Power Corp. v Heirs of Noble Casionan 6

National Power Corporation (NPC) v. Heirs of Noble Casionan G.R. No. 165969 November 27, 2008 REYES, R.T., J.: Facts: Sometime in the 1970s, petitioner NPC installed high -tension electrical transmission lines traversing the trail leading to Sangilo, Itogon, Benguet. Eventually, some of the transmission lines sagged and dangled reducing their distance from the ground to only about 8 to 10 feet. This posed a great threat to passersby who were exposed to the danger of electrocution especially during the wet season. Leaders of the community made verbal and written requests for NPC to institute safety measures but no action was taken. In 1995, Noble and his co-pocket miner Melchor Jimenez were carrying bamboo poles horizontally on their shoulder, with Noble carrying the shorter pole. Noble walked ahead as they passed through the trail underneath the NPC high-tension lines on their way to their workplace. As Noble was going uphill and turning left on a curve, the tip of the bamboo pole that he was carrying touched one of the dangling high-tension wires. Noble was electrocuted and he died as a consequence. Issue: Whether or not NPC was negligent and if there was contributory negligence on the part of Noble. Held: NPC was negligent. The sagging high tension wires were an accident waiting to happen. The lines were sagging around 8 to 10 feet in violation of the required distance of 18 to 20 feet. If the transmission lines were properly maintained by NPC, the bamboo pole carried by Noble would not have touched the wires. He would not have been electrocuted. Noble was not guilty of contributory negligence. Hence, NPC is not entitled to a mitigation of its liability. The trail where Noble was electrocuted was regularly used by members of the community. There were no warning signs to inform passersby of the impending danger to their lives should they accidentally touch the high tension wires. Also, the trail was the only viable

way from Dalicon to Itogon. Hence, Noble should not be faulted for simply doing what was ordinary routine to other workers in the area.
Ngo Sin Sing and Dy Ngo v Li SengGiap and Sons Inc. and Const. Tech. Dev. Corp. 7

NGO SIN SING and TICIA DY NGO vs. LI SENG GIAP & SONS, INC., and CONTECH CONSTRUCTION TECHNOLOGY DEVELOPMENT CORPORATION G.R. No. 170596; November 28, 2008 Ponente: NACHURA, J.: FACTS: Petitioner spouses Ngo Sin Sing and Ticia Dy Ngo owned a lot at 745 Caballero St., Binondo. In 1978, they decided to construct a 5-storey concrete building thereon, the NSS Building, and for this project, they contracted the services of Contech Construction Technology Development Corporation (Contech) as their General Contractor. Adjacent to their lot is a semiconcrete building known as the Li Seng Giap Building (LSG Building), owned by Li Seng Giap & Sons, Inc. (respondent). During the construction of the NSS Building, the respondent, through its general manager, John T. Lee, received complaints from their tenants about defects in the building. An inspection of the premises revealed that the excavation made by Contech on petitioners' land was close to the common boundary, exposing the foundation of the LSG Building. As a gesture of goodwill to their neighbors, the petitioners assured the respondent that repairs would be undertaken by their contractor. In December 1979, Contech announced that it had completed repairs on the LSG Building. Notwithstanding this assurance, more defects in the LSG Building appeared. Apparently, the LSG Building was continuously sagging and the respondent felt that it was no longer safe to occupy the building. In 1981, the respondent was constrained to consult engineers, E.S. de Castro Ph.D. and Associates, through Control Builders Corporation, to investigate the cause of the damages in the LSG Building and to determine its present structural integrity. It was immediately noticed that the LSG Building underwent differential settlement. The consultants then concluded that the structural failure of the LSG Building resulted from the differential settlement caused by the excavation during the construction of the NSS Building and recommended the complete demolition of the LSG Building. The demolition and reconstruction of the building was estimated to cost the respondents about P8,021,687.00. The respondents demanded that the petitioners rebuild the LSG Building or pay the cost of the same, which the petitioners refused. Thus, a complaint for sum of money was filed against Ngo Sin Sing, Ticia Dy Ngo and Contech Construction Technology Development Corporation with the RTC of Manila. After due hearing, the trial court ruled that the defendants were negligent. However, the trial court also stated that the plaintiff was likewise not without fault. The trial court noted that the LSG Building was originally a 2-storey building and the plaintiff added two more floors without providing the necessary foundation and reinforcement causing the building to sag. On appeal, CA affirmed the trial court's decision with modification. ISSUE: Whether or not respondents own negligence was the proximate cause of the damage to its building, or at least, amounted to contributory negligence warranting reduction of the award.

HELD: YES. The additional two floors put up on the LSG Building could have overburdened the foundation's load-bearing capacity and contributed to the sagging of the building. As the trial court correctly ruled: "adding more floors without touching or reinforcing the building's bottom line or foundation are already manifestive of some negligence or ignorance on the part of said building owner. x x x Had plaintiff stuck to his original building 2-storey with its kind of foundation, the excavation by its adjacent neighbor would not matter much or affect the building in question at the outset." Contributory negligence is conduct on the part of the injured party, contributing as a legal cause to the harm he has suffered, which falls below the standard to which he is required to conform for his own protection. In this case, considering that respondent's negligence must have necessarily contributed to the sagging of the LSG Building, a reduction of the award is warranted. We, therefore, agree with the trial court that respondent should likewise share in the cost of the restructuring of its building.
Norman Gaid v People 8

Norman Gaid v People FACTS: At around 12:00 noon on 25 October 2001, petitioner was driving his passenger jeepney along a two-lane road where the Laguindingan National High School is located toward the direction of Moog in Misamis Oriental. At the time several students were coming out of the school premises. Meanwhile, a fourteen year old student, Michael Dayata (Dayata), was seen sitting near a store on the left side of the road. From where the left side of the road, it appears that Dayata raised his left hand to flag down petitioners jeepney which was traveling on the right lane of the road. However, neither did petitioner nor the conductor, Dennis Mellalos (Mellalos), saw anybody flagging down the jeepney to ride at that point. Dayata was then seen lying on the ground and caught in between the rear tires. Petitioner felt that the left rear tire of the jeepney had bounced and the vehicle tilted to the right side. Mellalos heard a shout that a boy was run over, prompting him to jump off the jeepney to help the victim. Petitioner stopped and saw Mellalos carrying the body of the victim. Mellalos loaded the victim on a motorcycle and brought him to the hospital. Dayata was first brought to the Laguindingan Health Center, but it was closed. Mellalos then proceeded to the El Salvador Hospital. Upon advice of its doctors, however, Dayata was brought to the Northern Mindanao Medical Center where he was pronounced dead on arrival. The Municipal Circuit Trial Court (MCTC) found petitioner guilty beyond reasonable doubt of the crime charged. It held petitioner negligent in his driving considering that the victim was dragged to a distance of 5.70 meters from the point of impact. He was also scored for not stopping his vehicle after noticing that the jeepneys left rear tire jolted causing the vehicle to tilt towards the right. On appeal, the RTC affirmed in toto the decision of the MCTC. The Court of Appeals affirmed the trial courts judgment with modification in that it found petitioner guilty only of simple negligence resulting in homicide. It exonerated petitioner from the charge of reckless imprudence resulting to homicide on the ground that he was not driving

recklessly at the time of the accident. However, the appellate court still found him to be negligent when he failed to promptly stop his vehicle to check what caused the sudden jotting of its rear tire. ISSUE: WON the petitioner is negligent HELD: No. The presence or absence of negligence on the part of petitioner is determined by the operative events leading to the death of Dayata which actually comprised of two phases or stages. The first stage began when Dayata flagged down the jeepney while positioned on the left side of the road and ended when he was run over by the jeepney. The second stage covered the span between the moment immediately after the victim was run over and the point when petitioner put the jeepney to a halt. The court held that he cannot be held liable for reckless imprudence resulting in homicide, as found by the trial court. The proximate cause of the accident and the death of the victim was definitely his own negligence in trying to catch up with the moving jeepney to get a ride. The evidence on record do not show that the jeepney dragged the victim after he was hit and run over by the jeepney. Quite the contrary, the evidence discloses that the victim was not dragged at all. The prosecution was not able to establish that the proximate cause of the victims death was petitioners alleged negligence, if at all, even during the second stage of the incident.
Sps Luigi Guanio and Hernandez-Guanio v Makati Shangri-La Hotel and Resort 9

Spouses Luigi M. Guanio and Anna Hernandez-Guanio v. Makati Shangri-La Hotel and Resort, Inc., G.R. No. 190601, February 7, 2011 Facts: For their wedding, Sps Guanio booked at the Makati Shangri-La Hotel. They claimed that during the reception, the guests complained of delay in service of the food, the salmon were small and didnt correspond to the ones in the food tasting, the hotel waiters were ruled and unapologetic, and that they were compelled to pay for their drinks despite the open bar agreement. Thus, petitioners filed a complaint for breach of contract and damages before the RTC Makati. In their answer, the hotel alleged that the reason for the delay was the sudden increase of the guest list from 370 max to 480. The RTC found for the Sps Guanio, relying on the apology letter that said that the hotel disappointed the spouses. CA reversed the RTC decision, holding that the proximate cause of the injury was the unexpected increase in the guests, entirely attributable to the Sps Guanio. Hence, this petition. Issue: Whether the doctrine of proximate is applicable in the case at bar.

Held: No. The Court finds that since petitioners complaint arose from a contract, the doctrine of proximate cause finds no application to it. The doctrine of proximate cause is applicable only in actions for quasi-delicts, 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. What applies in the present case is Article 1170 of the Civil Code which reads: Art. 1170. Those who in the performance of their obligations are guilty of fraud, negligence or delay, and those who in any manner contravene the tenor thereof, are liable for damages.
Filipinas Synthetic Fiber Corp. v Wilfredo De Los Santos 10

Filipinas Synthetic Fiber Corp. v Wilfredo De Los Santos G.R. No. 152033, March 16, 2011 Peralta, J.: FACTS: On September 30, 1984, Teresa Elena Legarda-de los Santos, the wife of respondent Wilfredo de los Santos was fetched by Wilfredos brother Armando, husband of respondent Carmina Vda. de los Santos, from Rizal Theater to after Teresas theater performance. Armando drove a 1980 Mitsubishi Galant Sigma, a company car assigned to Wilfredo. Two other members of the cast of production joined Teresa Elena in the Galant Sigma. Around 11:30 p.m., while travelling along the Katipunan Road (White Plains), the Galant Sigma collided with the shuttle bus owned by petitioner and driven by Alfredo S. Mejia (Mejia), an employee of petitioner Filipinas Synthetic Corp. The Galant Sigma was dragged about 12 meters from the point of impact, across the White Plains Road landing near the perimeter fence of Camp Aguinaldo, where the Galant Sigma burst into flames and burned to death beyond recognition all four occupants of the car. A criminal charge for reckless imprudence resulting in damage to property with multiple homicide was brought against Mejia, which was decided in favor of Mejia (shuttle driver). A consolidated civil case was filed by the families of the deceased against Mejia. The RTC ruled in favor of herein respondents. After the denial of the motion for reconsideration, petitioner appealed to the CA and the CA affirmed the decision of the RTC. Hence this petition stating that the respondent court erred in finding Mejia negligent, such not being supported by evidence on record. ISSUE:

WON Mejia was negligent? HELD: Petitioner argues that the RTC admitted that De los Santos made a turn along White Plains Road without exercising the necessary care which could have prevented the accident from happening. According to petitioner, the sudden turn of the vehicle used by the victims should also be considered as negligence on the part of the driver of that same vehicle, thus, mitigating, if not absolving petitioners liability. However, the said argument deserves scant consideration. It was well established that Mejia was driving at a speed beyond the rate of speed required by law, specifically Section 35 of Republic Act No. (RA) 4136. Under the New Civil Code, unless there is proof to the contrary, it is presumed that a person driving a motor vehicle has been negligent if at the time of the mishap, he was violating any traffic regulation. Apparently, in the present case, Mejias violation of the traffic rules does not erase the presumption that he was the one negligent at the time of the collision. Even apart from statutory regulations as to speed, a motorist is nevertheless expected to exercise ordinary care and drive at a reasonable rate of speed commensurate with all the conditions encountered which will enable him to keep the vehicle under control and, whenever necessary, to put the vehicle to a full stop to avoid injury to others using the highway. A closer study of the Police Accident Report, Investigation Report and the sketch of the accident would reveal nothing but that the shuttle bus was traveling at such a reckless speed that it collided with the car bearing the deceased.
Rodolfo Regala v Federico Carin 11

Rodolfo Regala v Federico Carin G.R. No. 141761, July 28, 2006 PUNO, J.: FACTS: Petitioner and respondent are adjacent neighbors at Spirig Street, BF Resort Village, Las Pias City. When petitioner decided to renovate his one storey residence by constructing a second floor, he under the guise of merely building an extension to his residence, approached respondent sometime in May 1998 for permission to bore a hole through a perimeter wall shared by both their respective properties, to which respondent verbally consented on condition that petitioner would clean the area affected by the work. Regalas real intention was to build a second floor, in fact with a terrace atop the dividing wall. In the course of the construction of the second floor, respondent and his wife Marietta suffered from the dust and dirt which fell on their property. As petitioner failed to address the problem to respondents satisfaction, respondent filed a letter-complaint with the Office of the City Engineer and Building Official of Las Pias City on June 9, 1998. The Las Pias City RTC rendered judgment in favor of respondent whom it awarded moral damages in the sum of P100,000, exemplary damages of

P100,000 and attorneys fees of P50,000 plus costs of suit. The Court of Appeals affirmed the trial courts decision with modification by reducing the award of moral and exemplary damages to P50,000 and P25,000 ISSUE: WON Regala was guilty of negligence HELD: YES. There was fault or negligence on the part of the defendant when he did not provide sufficient safety measures to prevent causing a lot of inconvenience and disturbance to the plaintiff and his family. The evidence presented by the plaintiff regarding the dirt or debris, as well as the absence of devices or safety measures to prevent the same from falling inside plaintiffs property, were duly established. It did not help the cause of the defendant that he made a lot of misrepresentations regarding the renovations on his house and he did not initially have a building permit for the same. In fact, it was only after the construction works were completed that the said permit was issued and upon payment of an administrative fine by the defendant. Malice or bad faith implies a conscious and intentional design to do a wrongful act for a dishonest purpose or moral obliquity; it is different from the negative idea of negligence in that malice or bad faith contemplates a state of mind affirmatively operating with furtive design or ill will. While the Court harbors no doubt that the incidents which gave rise to this dispute have brought anxiety and anguish to respondent, it is unconvinced that the damage inflicted upon respondents property was malicious or willful, an element crucial to merit an award of moral damages under Article 2220 of the Civil Code. Petitioner, however, cannot steer clear from any liability whatsoever. Respondent and his familys rights to the peaceful enjoyment of their property have, at the very least, been inconvenienced from the incident borne of petitioners construction work. Any pecuniary loss or damage suffered by respondent cannot be established as the records are bereft of any factual evidence to establish the same. Nominal damages may thus be adjudicated in order that a right of the plaintiff, respondent herein, which has been violated or invaded by the defendant, petitioner herein, may be vindicated or recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered by him.
Dr.Rubi Lim v Sps Soliman 12

Dr. Rubi Li versus Spouses Reynaldo And Lina Soliman G.R. No. 165279, June 07, 2011 Villarama, Jr., J Facts: On July 7, 1993, respondents' 11-year old daughter, Angelica Soliman, underwent a biopsy of the mass located in her lower extremity at the St. Luke's Medical Center (SLMC). Results showed that Angelica was suffering from osteosarcoma, osteoblastic type, a high-grade (highly malignant) cancer of the bone which usually afflicts teenage children. Following this diagnosis

and as primary intervention, Angelica's right leg was amputated by Dr. Jaime Tamayo in order to remove the tumor. As adjuvant treatment to eliminate any remaining cancer cells, and hence minimize the chances of recurrence and prevent the disease from spreading to other parts of the patient's body (metastasis), chemotherapy was suggested by Dr. Tamayo. Dr. Tamayo referred Angelica to another doctor at SLMC, herein petitioner Dr. Rubi Li, a medical oncologist. On August 18, 1993, Angelica was admitted to SLMC. However, she died on September 1, 1993, just eleven (11) days after the (intravenous) administration of the first cycle of the chemotherapy regimen. On examination of the body of Angelica, it was found out that she died out of "Hypovolemic shock secondary to multiple organ hemorrhages and Disseminated Intravascular Coagulation." On February 21, 1994, respondents filed a damage suit against petitioner and others. Respondents charged them with negligence and disregard of Angelica's safety, health and welfare. Since the medical records of Angelica were not produced in court, the trial and appellate courts had to rely on testimonial evidence, principally the declarations of petitioner and respondents themselves. In dismissing the complaint, the trial court held that petitioner was not liable for damages as she observed the best known procedures and employed her highest skill and knowledge in the administration of chemotherapy drugs on Angelica but despite all efforts said patient died. Appeal was granted and reversed the ruling of the RTC; hence, the petition to the Supreme Court. Issue: Whether the petitioner can be held liable for failure to fully disclose serious side effects to the parents of the child patient who died while undergoing chemotherapy, despite the absence of finding that petitioner was negligent in administering the said treatment. Held: The Supreme Court ruled in the negative. The doctrine of informed consent applies in the case. There are four essential elements a plaintiff must prove in a malpractice action based upon the doctrine of informed consent: "(1) the physician had a duty to disclose material risks; (2) he failed to disclose or inadequately disclosed those risks; (3) as a direct and proximate result of the failure to disclose, the patient consented to treatment she otherwise would not have consented to; and (4) plaintiff was injured by the proposed treatment." The gravamen in an informed consent case requires the plaintiff to "point to significant undisclosed information relating to the treatment which would have altered her decision to undergo it. Examining the evidence on record, it can be clearly seen that there was adequate disclosure of material risks inherent in the chemotherapy procedure performed with the consent of Angelica's parents. Respondents could not have been unaware in the course of initial treatment and amputation of Angelica's lower extremity, that her immune system was already weak on account of the malignant tumor in her knee. When petitioner informed the respondents beforehand of the side effects of chemotherapy which includes lowered counts of white and red

blood cells, decrease in blood platelets, possible kidney or heart damage and skin darkening, there is reasonable expectation on the part of the doctor that the respondents understood very well that the severity of these side effects will not be the same for all patients undergoing the procedure. Hence, the ruling of the RTC is reinstated.
Albert Tison v Sps Gregorio Pomasin and Consorcia Ponce Pomasin 13

Tison v Spouses Pomasin G.R. No. 173180 PEREZ, J.: FACTS: Two vehicles, a tractor-trailer and a jitney,1 figured in a vehicular mishap along Maharlika Highway in Barangay Agos, Polangui, Albay last 12 August 1994. Laarni Pomasin (Laarni) was driving the jitney towards the direction of Legaspi City while the tractor-trailer, driven by Claudio Jabon (Jabon), was traversing the opposite lane going towards Naga City.2 The opposing parties gave two different versions of the incident. Gregorio Pomasin (Gregorio), Laarnis father, was on board the jitney and seated on the passengers side. He testified that while the jitney was passing through a curve going downward, he saw a tractor-trailer coming from the opposite direction and encroaching on the jitneys lane. The jitney was hit by the tractor-trailer and it was dragged further causing death and injuries to its passengers.3 On the other hand, Jabon recounted that while he was driving the tractor-trailer, he noticed a jitney on the opposite lane falling off the shoulder of the road. Thereafter, it began running in a zigzag manner and heading towards the direction of the truck. To avoid collision, Jabon immediately swerved the tractor-trailer to the right where it hit a tree and sacks of palay. Unfortunately, the jitney still hit the left fender of the tractor-trailer before it was thrown a few meters away. The tractor-trailer was likewise damaged.4 Multiple death and injuries to those in the jitney resulted. respondents filed a complaint for damages against petitioners before the Regional Trial Court (RTC) of Antipolo. They alleged that the proximate cause of the accident was the negligence, imprudence and carelessness of petitioners. Respondents prayed for indemnification for the heirs of those who perished in the accident, petitioners countered that it was Laarnis negligence which proximately caused the acciden the Regional Trial Court rendered judgment in favor of petitioners dismissing the complaint for damages, t The trial court considered the testimony of Jabon regarding the incident more convincing and reliable than that of Gregorios, a mere passenger, whose observation and attention to the road is not as focused as that of the driver. The trial court concluded that Laarni caused the collision of the jitney and the tractor-trailer. The Court of Appeals disagreed with the trial court and ruled that the reckless driving of Jabon caused the vehicular collision.

ISSUE: Who is the negligent party or the party at fault? RULING: The trial court found that the jitney driver was negligent. We give weight to this finding greater than the opposite conclusion reached by the appellate court that the driver of the tractor-trailer caused the vehicular collision. One reason why the trial court found credible the version of Jabon was because his concentration as driver is more focused than that of a mere passenger So that as between the respective versions of the plaintiffs thru their passenger and that of the defendants thru their driver as to the cause or antecedent causes that led to the vehicular collision in this case, the version of the driver of defendant should ordinarily be more reliable than the version of a mere passenger of Plaintiffs vehicle, simply because the attention of the passenger is not as much concentrated on the driving as that of the driver, consequently the capacity for observation of the latter of the latter on the matter testified to which is the precise point of inquiry --- the proximate cause of the accident --- is more reasonably reliable. Moreover, the passengers vision is not as good as that of the driver from the vantage point of the drivers seat especially in nighttime, thus rendering a passengers opportunity for observation on the antecedent causes of the collision lesser than that of the driver. There was no showing that the tractor-trailer was speeding. There is a preponderance of evidence that the tractor-trailer was in fact ascending. Considering its size and the weight of the tractor-trailer, its speed could not be more than that of a fully loaded jitney which was running downhill in a zigzagging manner. Neither can it be inferred that Jabon was negligent the negligence of Gregorios daughter, Laarni was the proximate cause of the accident. We did not lose sight of the fact that at the time of the incident, Jabon was prohibited from driving the truck due to the restriction imposed on his drivers license, The Court of Appeals concluded therefrom that Jabon was violating a traffic regulation at the time of the collision. Driving without a proper license is a violation of traffic regulation. Under Article 2185 of the Civil Code, the legal presumption of negligence arises if at the time of the mishap, a person was violating any traffic regulation. However, in Sanitary Steam Laundry, Inc. v. Court of Appeals,27 we held that a causal connection must exist between the injury received and the violation of the traffic regulation. It must be proven that the violation of the traffic regulation was the proximate or legal cause of the injury or that it substantially contributed thereto In the instant case, no causal connection was established between the tractor-trailer drivers restrictions on his license to the vehicular collision. Furthermore, Jabon was able to sufficiently explain that the Land Transportation Office merely erred in not including restriction code 8 in his license.
Sps Fernando and Lourdes Viloria v Continental Airlines 14

SPOUSES FERNANDO & LOURDES VILORIA vs. CONTINENTAL AIRLINES, INC. (CAI), GR No. 188288 (16 January 2012)

FACTS Fernando agreed to buy airline tickets on board CAI after Margaret Mager of Holiday Travel (HT) agency informed him that there were no available seats at Amtrak. Subsequently, Fernando requested Mager to reschedule their flight. Mager informed him that flights to Newark, New Jersey, USA via CAI were fully booked and offered the alternative flight via Frontier Air. Since alternative flight would be more costly and would mean traveling by night, Fernando opted to request for a refund. Mager denied his request as said tickets were nonrefundable. When Fernando saw an Amtrak station nearby, he made inquiries and was told that there were seats available anytime. Fernando confronted Mager with the Amtrak tickets, telling her that she had misled them into buying CAI tickets by misrepresenting that Amtrak was already fully booked. Fernando reiterated his demand for a refund but Mager denied it. Fernando sent a letter to CAI demanding a refund. Continental Micronesia denied his request and advised him that he may take said tickets to any CAI ticketing location for re-issuance of new tickets. When Fernando went to CAIs ticketing office to have the tickets replaced by a single round trip ticket to Los Angeles under his name, he was informed that Lourdes ticket was non-transferable, thus, cannot be used for the purchase of a ticket in his favor. Sps. Viloria filed a complaint against CAI. CAI interposed, among other things, that it should not be liable for Magers acts because she was not a CAI employee. Citing Articles 1868 and 1869 of the Civil Code, RTC-Antipolo City ruled that Mager was CAIs agent, hence, bound by her bad faith and misrepresentation. On appeal, the Court of Appeals (CA) reversed RTC-Antipolo Citys decision and ruled that CAI cannot be held liable for Magers act in the absence of any proof that a principal -agent relationship existed between CAI and HT, as the contract was not an agency but that of a sale. Hence, this petition. ISSUE assuming that an agency relationship existed between the two, would CAI be bound by the acts of HTs agents and employees such as Mager? HELD Yes. SC mentioned that an examination of its pronouncements in China Air Lines, Ltd. v. Court of Appeals, et al. [264 Phil 15 (1990)] will reveal that an airline company is not completely exonerated from any liability for the tort committed by its agents employees. A prior determination of the nature of the passengers cause of action is necessary. If the passengers cause of action against the airline company is premised on culpa aquiliana or quasi-delict for a tort committed by the employee of the airline companys agent, there must be an independent

showing that the airline company was at fault or negligent or has contributed to the negligence or tortuous conduct committed by the employee of its agent. The mere fact that the employee of the airline companys agent has committed a tort is not sufficient to hold the airline company liable. There is no vinculum juris between the airline company and its agents employees and the contractual relationship between the airline company and its agent does not operate to create a juridical tie between the airline company and its agents employees. Article 2180 of the Civil Code does not make the principal vicariously liable for the tort committed by its agents employees and the principal-agency relationship per se does not make the principal a party to such tort; hence, the need to prove the principals own fault or negligence. On the other hand, if the passengers cause of action for damages against the airline company is based on contractual breach or culpa contractual, it is not necessary that there be evidence of the airline companys fault or negligence. As SC stated in China Air Lines, "in an action based on a breach of contract of carriage, the aggrieved party does not have to prove that the common carrier was at fault or was negligent. All that he has to prove is the existence of the contract and the fact of its non-performance by the carrier." SC denied the petition.

II.

Affirmative Duties and Miscellaneous Activities 15

Rogelio Nogales v Capitol Medical Center

NOGALES vs CAPITOL MEDICAL CENTER Case Digest ROGELIO NOGALES vs. CAPITOL MEDICAL CENTER et al. G.R. No. 142625 December 19, 2006 Facts: Pregnant with her fourth child, Corazon Nogales ("Corazon"), who was then 37 years old, was under the exclusive prenatal care of Dr. Oscar Estrada ("Dr. Estrada") beginning on her fourth month of pregnancy or as early as December 1975. Around midnight of 25 May 1976, Corazon started to experience mild labor pains prompting Corazon and Rogelio Nogales ("Spouses Nogales") to see Dr. Estrada at his home. After examining Corazon, Dr. Estrada advised her immediate admission to the Capitol Medical Center ("CMC"). t 6:13 a.m., Corazon started to experience convulsionsAt 6:22 a.m., Dr. Estrada, assisted by Dr. Villaflor, applied low forceps to extract Corazon's baby. In the process, a 1.0 x 2.5 cm. piece of cervical tissue was allegedly torn.At 6:27 a.m., Corazon began to manifest moderate vaginal bleeding which rapidly became profuse. Corazon died at 9:15 a.m. The cause of death was "hemorrhage, post partum. Issue: Whether or not CMC is vicariously liable for the negligence of Dr. Estrada.

Ruling: Private hospitals, hire, fire and exercise real control over their attending and visiting "consultant" staff. The basis for holding an employer solidarily responsible for the negligence of its employee is found in Article 2180 of the Civil Code which considers a person accountable not only for his own acts but also for those of others based on the former's responsibility under a relationship of patria potestas. In general, a hospital is not liable for the negligence of an independent contractor-physician. There is, however, an exception to this principle. The hospital may be liable if the physician is the "ostensible" agent of the hospital. This exception is also known as the "doctrine of apparent authority. For a hospital to be liable under the doctrine of apparent authority, a plaintiff must show that: (1) the hospital, or its agent, acted in a manner that would lead a reasonable person to conclude that the individual who was alleged to be negligent was an employee or agent of the hospital; (2) where the acts of the agent create the appearance of authority, the plaintiff must also prove that the hospital had knowledge of and acquiesced in them; and (3) the plaintiff acted in reliance upon the conduct of the hospital or its agent, consistent with ordinary care and prudence. In the instant case, CMC impliedly held out Dr. Estrada as a member of its medical staff. Through CMC's acts, CMC clothed Dr. Estrada with apparent authority thereby leading the Spouses Nogales to believe that Dr. Estrada was an employee or agent of CMC.
III. Defenses in Negligence Cases 16

Tedeorico Manzanares v People

Teoderico Manzanares v. People of the Philippines gr nos. 153760-61 oct. 12, 2006 Facts: At about 2:30 oclock in the afternoon of 13 January 1983, a vehicular collision took place along MacArthur Highway in Bulacan nvolving an Isuzu six-wheeler truck and a passenger jeepney. The Isuzu truck was owned by petitioner Manhattan Enterprises, Inc. and was then driven by petitioner Teodorico Manzanares. The passenger jeepney, on the other hand, was registered in the name of Teodoro Basallo. It was established during the trial that the passenger jeepney was heading southwards in the direction of Manila while the Isuzu truck was heading the opposite way. The incident resulted in the deaths of the driver of the passenger jeepney Jesus Basallo, Miguel Anas, Ferdinand Exaltacion, and Antonio Pasco. It also inflicted serious physical injuries to some of the passengers. The families of the deceased Ferdinand Exaltacion[2] and Miguel Anas[3] instituted separate civil cases for damages against petitioners Manzanares, Manhattan Enterprises, Inc., the latters managing partner, Eduardo Yang, and the operator of the passenger jeepney, Teodoro Basallo. The heirs of Antonio Pasco opted to file a complaint

against petitioners Manhattan Enterprises Co. and Teodorico Manzanares. Two of those who sustained injuries also filed their respective complaints against petitioners and Teodoro Basallo. In her complaint,[6] Felicidad Tomaquin claimed that because of the incident, she would not be able to report to her work in a factory for more than twelve months while Cita Vicente demanded that she be paid her salary for the two-month period that she was unable to perform her job as a secretary in a law firm in Bulacan. Teodoro Basallo was sued on the basis of breach of contract of carriage as he was the registered owner of the passenger jeepney. Teodoro Basallo alleged that while he owned the passenger jeepney involved in the collision, the same was on lease to his brother and the jeepneysdriver, Jesus Basallo for P100.00 a day thus, he did not have a contract of carriage with anyone. ISSUE: whether respondent Basallo is presumed negligent having contributory negligence in this case. Held: no. As to petitioners argument that Jesus Basallo should be presumed negligent because he was driving with an expired license and the passenger jeepney owned by his brother Teodorico did not have a franchise to operate, we hold that the same fails to convince. The defense of contributory negligence does not apply in criminal cases committed through reckless imprudence, since one cannot allege the negligence of another to evade the effects of his own negligence.
Universal Aquarius Inc. v QC Human Resources Management Corp. 17

Universal Aquarius Inc. v QC Human Resources Management Corp. G.R. NO. 155990, September 12, 2007 AUSTRIA-MARTINEZ, J.: FACTS: Universal is engaged in the manufacture and distribution of chemical products in Metro Manila. It operates a chemical plant in Antipolo City. Tan, as a proprietor under the name and style of Marman, is engaged in the trading, delivery and distribution of chemical products in Metro Manila, with a depot in Antipolo City adjoining Universal's chemical plant. Q.C. Human Resources Management Corporation (Resources) is engaged in supplying manpower to various establishments. They supplied Universal with about 74 temporary workers to assist Universal in their operations in Antipolo. Capocyan, claiming to be the general counsel/national president of the labor organization called Obrero Pilipino sent a Notice of Strike to Universal. Later, Resources informed the Regional Office of the Department of Labor and Employment that the officers and members of Obrero Pilipino are its employees and not employees of Universal. Five days later, Capocyon and 36

other union officers and members of Obrero Pilipino conducted a strike and as such disrupting its business operations. Marman's depot, which is adjoining Universal's plant, suffered a similar fate. Later, Universal and Tan filed a Complaint against the strikers and Resources at the RTC for breach of contract and damages suffered due to the disruption of their respective business operations. Then, Universal forged an agreement with Obrero Pilipino ending the labor dispute. Universal and Tan then filed a Notice of Dismissal as against the strikers. Resources filed a Motion to Dismiss, contending that the complaint stated no cause of action against it since there is nothing in the allegations thereof that it participated in the acts committed by its employees. The RTC denied, but upon appeal the CA dismissed the case. ISSUE: Whether or not Tan can claim for damages? HELD: NO. The court finds that she has no cause of action against Resources. A thorough reading of the allegations of the Complaint reveals that Tan's claim for damages clearly springs from the strike effected by the employees of Resources. It is settled that an employer's liability for acts of its employees attaches only when the tortious conduct of the employee relates to, or is in the course of, his employment. An employer incurs no liability when an employees conduct, act or omission is beyond the range of employment. In the case at bar, when Resources' employees staged a strike, they were acting on their own, beyond the range of their employment. Thus, Resources cannot be held liable for damages caused by the strike staged by its employees.
Cayao-Lasam v SpsRamolete 18

Cayao-Lasam v. Sps. Ramolete FACTS Three months pregnant Editha Ramolete, respondent, was brought to the Lorma Medical Center (LMC) in San Fernando, La Union due to vaginal bleeding. Upon advice of petitioner relayed via telephone, Editha was admitted to the LMC on the same day. A pelvic sonogram was then conducted on Editha revealing the fetus weak cardiac pulsation. Due to persistent and profuse vaginal bleeding, petitioner advised Editha to undergo a Dilatation and Curettage Procedure (D&C) or "raspa." Petitioner performed the D&C procedure. Editha was discharged from the hospital the following day. Editha was once again brought at the LMC, as she was suffering from vomiting and severe abdominal pains. Editha was attended by Dr. de la Cruz, Dr. Mayo and Dr. Komiya. Dr. Mayo

allegedly informed Editha that there was a dead fetus in the latters womb. After, Editha underwent laparotomy, she was found to have a massive intra-abdominal hemorrhage and a ruptured uterus. Thus, Editha had to undergo a procedure for hysterectomy and as a result, she has no more chance to bear a child. Editha and her husband Claro Ramolete (respondents) filed a Complaint for Gross Negligence and Malpractice against petitioner before the Professional Regulations Commission (PRC). Respondents alleged that Edithas hysterectomy was caused by petitioners unmitigated negligence and professional incompetence in conducting the D&C procedure and the petitioners failure to remove the fetus inside Edithas womb. Petitioner contended that it was respondents negligence and omission in insisting to be discharged against doctors advice and her unjustified failure to return for check-up that contributed to her life-threatening condition. Board of Medicine (the Board) of the PRC rendered a Decision,14 exonerating petitioner from the charges filed against her. The case was then elevated to the CA. ISSUE WON respondent can claim damages against petitioner HELD No. Medical malpractice is a particular form of negligence which consists in the failure of a physician or surgeon to apply to his practice of medicine that degree of care and skill which is ordinarily employed by the profession generally, under similar conditions, and in like surrounding circumstances. In order to successfully pursue such a claim, a patient must prove that the physician or surgeon either failed to do something which a reasonably prudent physician or surgeon would not have done, and that the failure or action caused injury to the patient. There are four elements involved in medical negligence cases: duty, breach, injury and proximate causation. Respondents did not present any expert testimony to support their claim that petitioner failed to do something which a reasonably prudent physician or surgeon would have done. Petitioner, on the other hand, presented the testimony of Dr. Augusto M. Manalo, who was clearly an expert on the subject. Dr. Manalo specializes in gynecology and obstetrics, authored and co-authored various publications on the subject, and is a professor at the University of the Philippines. According to him, his diagnosis of Edithas case was "Ectopic Pregnancy Interstitial (also referred to as Cornual), Ruptured." In stating that the D&C procedure was not the proximate cause of the rupture of Edithas uterus resulting in her hysterectomy. It is evident from his testimony that the D&C procedure was not the proximate cause of the rupture of Edithas uterus. the D&C procedure was conducted in accordance with the standard practice, with the same level of care that any reasonably competent doctor would use to treat a condition under the same circumstances, and that there was nothing irregular in the way the petitioner dealt with Editha. In the testimony of Dr. Manalo, he stated further that assuming that there was in fact a misdiagnosis, the same would have been rectified if Editha followed the petitioners order to return for a check-up.

Based on the evidence presented in the present case under review, in which no negligence can be attributed to the petitioner, the immediate cause of the accident resulting in Edithas injury was her own omission when she did not return for a follow-up check up, in defiance of petitioners orders. The immediate cause of Edithas injury was her own act; thus, she cannot recover damages from the injury.

IV.

Causation 19

Cresencia Achevara v Elvira Ramos

CRESENCIA ACHEVARA, ALFREDO ACHEVARA, and BENIGNO VALDEZ vs. ELVIRA RAMOS, JOHN ARNEL RAMOS, and KHRISTINE CAMILLE RAMOS G.R. No. 175172 September 29, 2009 Ponente: PERALTA, J.: FACTS: Respondents filed a complaint for damages against petitioners for the death of Arnulfo Ramos in a vehicular accident that happened along Barangay Tablac, Candon, Ilocos Sur. Crescencia Achevara was sued as the operator of the passenger jeep driven by Benigno Valdez (Valdez), which was involved in the vehicular accident. Respondents alleged that Valdez was driving a passenger jeep in a reckless, careless, and negligent manner when he tried to overtake a motorcycle, causing the passenger jeep to encroach on the opposite lane and bump the oncoming vehicle driven by Arnulfo Ramos. Petitioners denied the allegations and claimed that Valdez was driving southward at a moderate speed when he saw an owner-type jeep coming from the south and heading north, running in a zigzag manner, and encroaching on the west lane of the road. To avoid a collision, Valdez drove the passenger jeep towards the shoulder of the road, west of his lane, but the owner-type jeep continued to move toward the western lane and bumped the left side of the passenger jeep. Petitioners alleged that it was Arnulfo Ramos who was careless and negligent in driving a motor vehicle, which he very well knew had a mechanical defect. ISSUE: Whether or not respondents may be held liable for the collision. HELD: The court ruled in the negative. Foreseeability is the fundamental test of negligence. To be negligent, a defendant must have acted or failed to act in such a way that an ordinary reasonable man would have realized that certain interests of certain persons were unreasonably subjected to a general but definite class of risks.

Seeing that the owner-type jeep was wiggling and running fast in a zigzag manner as it travelled on the opposite side of the highway, Valdez was made aware of the danger ahead if he met the owner-type jeep on the road. Yet he failed to take precaution by immediately veering to the rightmost portion of the road. The court finds that Valdez is guilty of inexcusable negligence by neglecting to take such precaution, which a reasonable and prudent man would ordinarily have done under the circumstances and which proximately caused injury to another. However, the court also believes that Arnulfo Ramos is guilty of gross negligence for knowingly driving a defective jeep on the highway. An ordinarily prudent man would know that he would be putting himself and other vehicles he would encounter on the road at risk for driving a mechanically defective vehicle. Under the circumstances, a prudent man would have had the owner-type jeep repaired or would have stopped using it until it was repaired. Gross negligence is the absence of care or diligence as to amount to a reckless disregard of the safety of persons or property. The acts of negligence of Arnulfo Ramos and Benigno Valdez were contemporaneous when Ramos continued to drive a wiggling vehicle on the highway despite knowledge of its mechanical defect, while Valdez did not immediately veer to the rightmost side of the road upon seeing the wiggling vehicle of Ramos. The doctrine of last clear chance applies to a situation where the plaintiff was guilty of prior or antecedent negligence, but the defendant who had the last fair chance to avoid the impending harm and failed to do so is made liable for all the consequences of the accident, notwithstanding the prior negligence of the plaintiff. However, the doctrine does not apply where the party charged is required to act instantaneously, and the injury cannot be avoided by the application of all means at hand after the peril is or should have been discovered. The doctrine of last clear chance does not apply to this case, because even if it can be said that it was Valdez who had the last chance to avoid the mishap, Valdez no longer had the opportunity to avoid the collision. Considering that the time the owner-type jeep encroached on the lane of Valdez to the time of impact was only a matter of seconds, he no longer had the opportunity to avoid the collision.
Lambert Ramos v COL Realty Corporation 20

LAMBERT S. RAMOS vs. C.O.L. REALTY CORPORATION G.R. No. 184905 August 28, 2009 Ponente: YNARES-SANTIAGO, J FACTS: A vehicular accident took place along Katipunan Avenue, Quezon City, between a Toyota Altis owned by C.O.L. Realty Corporation, and driven by Aquilino Larin (Aquilino), and a Ford Expedition, owned by Lambert Ramos (Ramos) and driven by Rodel Ilustrisimo (Rodel). A passenger of the Altis, Estela Maliwat (Estela) sustained injuries and was immediately rushed to the hospital for treatment.

C.O.L. Realty averred that its driver, Aquilino, was slowly driving the Toyota Altis along Rajah Matanda Street and has just crossed the center lane of Katipunan Avenue when the Ford Expedition violently rammed against the cars right rear door and fender. On the other hand, Ramos maintained that the Altis crossed Katipunan Avenue from Rajah Matanda Street despite the MMDA order prohibiting vehicles to pass through the intersection and the concrete barriers placed thereon. ISSUE: Whether or not Ramos may be held liable for the negligence of his employee Rodel. HELD: There is no doubt that Aquilinos violation of the MMDA prohibition against crossing Katipunan Avenue from Rajah Matanda Street was the proximate cause of the accident. His negligence is established by the fact that he violated a traffic regulation. This finds support in Article 2185 of the Civil Code which states that: "Unless there is proof to the contrary, it is presumed that a person driving a motor vehicle has been negligent if at the time of the mishap, he was violating any traffic regulation. Moreover, it was the proximate cause of the accident, and thus precludes any recovery for any damages suffered by respondent from the accident. Proximate cause is defined as that cause, which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces the injury, and without which the result would not have occurred. The proximate legal cause is that acting first and producing the injury, either immediately or by setting other events in motion, all constituting a natural and continuous chain of events, each having a close causal connection with its immediate predecessor, the final event in the chain immediately effecting the injury as a natural and probable result of the cause which first acted, under such circumstances that the person responsible for the first event should, as an ordinary prudent and intelligent person, have reasonable ground to expect at the moment of his act or default that an injury to some person might probably result therefrom. If Aquilino heeded the MMDA prohibition against crossing Katipunan Avenue from Rajah Matanda, the accident would not have happened. This specific untoward event is exactly what the MMDA prohibition was intended for. Thus, a prudent and intelligent person who resides within the vicinity where the accident occurred, Aquilino had reasonable ground to expect that the accident would be a natural and probable result if he crossed Katipunan Avenue since such crossing is considered dangerous on account of the busy nature of the thoroughfare and the ongoing construction of the Katipunan-Boni Avenue underpass. According to the principle embodied in Article 2179 of the Civil Code, that when the plaintiffs own negligence was the immediate and proximate cause of his injury, he cannot recover damages. As to the alleged Rodel's contributory negligence- the court finds it unnecessary to delve into it, since it cannot overcome or defeat Aquilinos recklessness which is the immediate and proximate cause of the accident.

Agusan Del NOrte Electric Cooperative Inc. v Angelina Balen

21

AGUSAN DEL NORTE ELECTRIC COOPERATIVE, INC. (ANECO) vs. ANGELITA BALEN G.R. No. 173146, November 25, 2009 NACHURA, J.: Facts: Agusan del Norte Electric Cooperative, Inc. (ANECO) is a duly organized and registered consumers cooperative, engaged in supplying electricity in the province of Agusan del Norte and in Butuan City. In 1981, ANECO installed an electric post with its main distribution line of 13,000 kilovolts traversing Angelita Balens (Balens) residence. Balens father, Miguel, protested the installation with the District Engineers Office and with ANECO, but no action was done. The antenna pole touched ANECOs main distribution line which resulted in their electrocution of Balen, Hercules Lariosa and Celestino Exclamado. As a result, Exclamado died instantly, while Balen and Lariosa suffered extensive third degree burns. ANECO denied the allegations and contend that the complaint did not allege any wrongful act on the part of ANECO, and that respondents acted with gross negligence and evident bad faith. The RTC ruled in favor of the respondents and the CA affirmed the decision. Issue: Whether or not the proximate cause of the injury was ANECOs negligence in installing its main distribution line over Balens residence. Held: Yes. Negligence the failure to observe for the protection of the interests of another person that degree of care, precaution, and vigilance which the circumstances justly demand, by reason of which such other person suffers injury. The issue of who, between the parties, was negligent is a factual issue that this Court cannot pass upon, absent any whimsical or capricious exercise of judgment by the lower courts or an ample showing that they lacked any basis for their conclusions. The unanimity of the CA and the trial court in their factual ascertainment that ANECOs negligence was the proximate cause of the injuries sustained by respondents is conclusive upon the Court. The evidence shows that the house of Miguel Balen already existed before the high voltage wires were installed by ANECO above it. Knowing that it was installing a main distribution line of high voltage over a populated area, ANECO should have practiced caution, care and prudence by installing insulated wires, or else found an unpopulated area for the said line to traverse. The clearance requirements for the installation of said line were met by ANECO does not suffice to exonerate it from liability. There is also a scarcity of evidence in the records showing that

ANECO put up the precautionary sign: WARNING-HIGH VOLTAGE-KEEP OUT at or near the house of Miguel Balen as required. Therefore, ANECOs act of leaving unprotected and uninsulated the main distribution line over Balens residence was the proximate cause of the incident which claimed Exclamados life and injured respondents Balen and Lariosa.

V.

Human Relations: Intentional Torts 22

Titus Villanueva v E mma Rosqueta

TITUS B. VILLANUEVA vs. EMMA M. ROSQUETA G.R. No. 180764 , January 19, 2010 Ponente: ABAD, J.: FACTS: This case is about the right to recover damages for alleged abuse of right committed by a superior public officer in preventing a subordinate from doing her assigned task and being officially recognized for it. Respondent Emma M. Rosqueta (Rosqueta), formerly Deputy Commissioner of the Revenue Collection and Monitoring Group of the Bureau of Customs (the Bureau), tendered her courtesy resignation from that post on January 23, 2001, shortly after President Gloria Macapagal-Arroyo assumed office. But five months later on June 5, 2001, she withdrew her resignation, claiming that she enjoyed security of tenure and that she had resigned against her will on orders of her superior. Meantime, on July 13, 2001 President Arroyo appointed Gil Valera (Valera) to respondent Rosquetas position. Hence, the position is under litigation initiated by Rosqueta where the court approved a writ of preliminary injunction enjoining Villanueva from implementing Valeras appointment. During the Bureaus celebration of its centennial anniversary, its special Panorama magazine edition featured all the customs deputy commissioners, except respondent Rosqueta. The souvenir program, authorized by the Bureaus Steering Committee headed by petitioner Villanueva to be issued on the o ccasion, had a space where Rosquetas picture was supposed to be but it instead stated that her position was "under litigation." Meanwhile, the commemorative billboard displayed at the Bureaus main gate included Valeras picture but not Rosquetas. With this, Rosqueta filed a complaint for damages alleging that Villanueva maliciously excluded her from the centennial anniversary memorabilia. Further, she claimed that he prevented her from performing her duties as Deputy Commissioner, withheld her salaries, and refused to act on her leave applications. ISSUE: Whether or not Villanueva is liable for damages under the principle of abuse of right? HELD:

YES. Under the abuse of right principle found in Article 19 of the Civil Code,a person must, in the exercise of his legal right or duty, act in good faith. He would be liable if he instead acts in bad faith, with intent to prejudice another. Complementing this principle are Articles 20 and 21of the Civil Code which grant the latter indemnity for the injury he suffers because of such abuse of right or duty. Petitioner Villanueva ignored the injunction shows bad faith and intent to spite Rosqueta who remained in the eyes of the law the Deputy Commissioner. His exclusion of her from the centennial anniversary memorabilia was not an honest mistake by any reckoning. Indeed, he withheld her salary and prevented her from assuming the duties of the position. As the Court said in Amonoy v. Spouses Gutierrez, a partys refusal to abide by a court order enjoining him from doing an act, otherwise lawful, constitutes an abuse and an unlawful exercise of right.

VI.

Human Dignity 23

People v Dante Gragasin y Par

People v Dante Gragasin y Par BBB, AAAs mother, narrated that at around 9:00 oclock in the evening o f 23 September 2001, AAA, then 9 years old, sought permission from her so she could go to her grandmothers house to see the dress AAA was going to wear during the fiesta. BBBs house was about 50 meters away from her grandmothers house. After some time and AAA had not returned home, BBB followed her daughter to the house of her mother-in-law and saw her daughter in the kitchen "jumping and putting on her short pants." BBB then saw accused-appellant, a helper in said house, lying on his bed totally naked and pretending to be asleep. By that time, AAA had already run out of the house. Thereafter, BBB went out to ask the help of a councilwoman in XXX and Omar Saturno, a policeman from XXX, and asked them to go check on the appearance of accusedappellant who was totally naked, and the appearance of AAA. Saturno tried but failed to contact the police station. Afterwards, they proceeded to BBBs house where BBB asked her daughter AAA what happened to her. In the presence of the councilwoman and the policeman, AAA narrated that she was raped by accused-appellant. Because they could not reach the police station as it was nighttime already, the policeman advised them to wait until the next morning to have accused-appellant summoned by the barangay officials. BBB and her husband CCC controlled their urge to confront and kill the accused, and decided to leave him alone so he would not escape. RTC found accused guilty beyond reasonable doubt of rape. CA affirmed. Hence this appeal where accused poses as defense that since there is no sperm found in the victim, there is no rape. Held: Accused-appellants contention that there can be no consummated rape, considering the absence of spermatozoa in the victim's vagina, is of no merit. The absence of spermatozoa does

not negate the conclusion that it was his penis that was inserted into the victim's vagina. Jurisprudence is replete with examples where, despite the absence of spermatozoa, the accused was still found guilty of consummated rape. People v. Dones held that the important consideration in rape cases is not the emission of semen, but the penetration of the female genitalia by the male organ. In People v. Bato, this Court affirmed that the presence or absence of spermatozoa is immaterial in a prosecution for rape, the important consideration not being the emission of semen, but the unlawful penetration of the female genitalia by the male organ. Similarly, this Court stressed in People v. Arivan that the absence of spermatozoa in the private complainant's sex organ does not disprove rape. It could be that the victim washed or urinated prior to her examination, which may well explain the absence of spermatozoa.
Zenaida Gregorio v CA 24

ZENAIDA R. GREGORIO vs. COURT OF APPEALS, SANSIO PHILIPPINES, INC., and EMMA J. DATUIN G.R. No. 179799 September 11, 2009 NACHURA, J.: FACTS: Respondents Emma J. Datuin and Sansio Philippines, Inc. filed an affidavit of complaint for violation of B.P. Blg. 22 against petitioner Zenaida R. Gregorio a proprietor of Alvi Marketing. The MTC issued a warrant of arrest and she was subsequently arrested while visiting her family house in Quezon City. On the other hand, Gregorio alleged that she could not have issued the bounced checks as she did not have a checking account with the bank on which the checks were drawn; the signature on the bounced checks were radically and patently different from her own signature. Gregorio then filed a complaint for damages against Sansio and Datuin, that as a result of her wrongful arrest and arraignment, she suffered helplessness, hunger and humiliation and being distraught. Datuin and Sansio meanwhile filed a Motion to Dismiss on grounds that Gregorios complaint arose from grounds of compensation arising from malicious prosecution. ISSUES: Is Gregorio entitled to damages arising from her wrongful? (yes) Is the complaint, a civil suit filed by Gregorio, is based on quasi-delict or malicious prosecution? HELD: Basic is the legal principle that the nature of an action is determined by the material averments in the complaint and the character of the relief sought. Gregorios civil complaint, read in its entirety, is a complaint based on quasi-delict under Article 2176, in relation to Article 26 of the Civil Code, rather than on malicious prosecution. Gregorio claimed damages for the embarrassment and humiliation she suffered when she was suddenly arrested at her city residence in Quezon City while visiting her family. She was, at the time of her arrest, a respected

Kagawad in Oas, Albay. Gregorio anchored her civil complaint on Articles 26,[21] 2176,[22] and 2180[23] of the Civil Code. Noticeably, despite alleging either fault or negligence on the part of Sansio and Datuin, Gregorio never imputed to them any bad faith in her complaint. YES. Article 26 of the Civil Code grants a cause of action for damages, prevention, and other relief in cases of breach, though not necessarily constituting a criminal offense, of the following rights: (1) right to personal dignity; (2) right to personal security; (3) right to family relations; (4) right to social intercourse; (5) right to privacy; and (6) right to peace of mind. It appears that Gregorios rights to personal dignity, personal security, privacy, and peace of mind were infringed by Sansio and Datuin when they failed to exercise the requisite diligence in determining the identity of the person they should rightfully accuse of tendering insufficiently funded checks. This fault was compounded when they failed to ascertain the correct address of petitioner, thus depriving her of the opportunity to controvert the charges, because she was not given proper notice. Although she was never found at the office address in the criminal complaint, Gregorio was conveniently arrested by armed operatives in Quezon City, while she was visiting family. She suffered embarrassment and humiliation over her sudden arrest and detention and she had to spend time, effort, and money to clear her tarnished name and reputation, considering that she had held several honorable positions in different organizations and offices in the public service, particularly her being a Kagawad in Oas, Albay at the time of her arrest. There exists no contractual relation between Gregorio and Sansio. On the other hand, Gregorio is prosecuting Sansio, under Article 2180 of the Civil Code, for its vicarious liability, as employer, arising from the act or omission of its employee Datuin.
PO3 Benito Sombilon Jr. v People 25

PO3 Benito Sombilon Jr. v People G.R. No. 175528 LEONARDO-DE CASTRO, J.: Facts: On 15 Aug 1998, a 15-year old girl was investigated by PO3 Sombilon at the Calinan Polcie Station, Davao City in a complaint filed against her fir theft. She was alleged to have been taken inside a room where her hands were electrocuted to induce a confession. Simultaneously, she was touched all over her body, her breasts, belly and private parts and kissed on the cheek, for more than an hour. She was brought to the hospital while trembling and coherent. The RTC found Sombilon guilty of acts of lasciviousness. CA affirmed. Sombion contends that having merely touched the victi, it did not constitute lewdness but merely unjust vexation. Issue: Whether Sombilon's acts constitute lewdness. Held:

The term lewd is commonly defined as something indecent or obscene; it is characterized by or intended to excite crude sexual desire. That an accused is entertaining a lewd or unchaste design is necessarily a mental process the existence of which can be inferred by overt acts carrying out such intention, i.e., by conduct that can only be interpreted as lewd or lascivious. The presence or absence of lewd designs is inferred from the nature of the acts themselves and the environmental circumstances. In the instant case, the intention of petitioner was intended neither to merely annoy or irritate the victim nor to force her to confess the theft. He could have easily achieved that when he electrocuted the latter. Petitioner intended to gratify his sexual desires. Petitioner succeeded in fondling the victims breasts intense enough to cause multiple slight contusions of bilateral breast areas.

VII.

Torts with Independent Civil Action 26

GMA Network Inc. v Jesus Bustos

GMA Network and Rey Vidal v. Bustos, et al GR. No. 146848, October 17,2006 Garcia, J. Facts: In August 1987, the Board of Medicine of the Professional Regulation Commission (PRC) conducted the physicians licensure examinations. Out of the total two thousand eight hundred thirty-five (2,835) examinees who took the examinations, nine hundred forty-one (941) failed. On February 10, 1988, a certain Abello and over two hundred other unsuccessful examinees filed a Petition for Mandamus before the RTC of Manila to compel the PRC and the board of medical examiners to re-check and reevaluate the test papers. As alleged, mistakes in the counting of the total scores and erroneous checking of answers to test questions vitiated the results of the examinations. This filing was covered by petitioner in its news report, the following a text of the news report which was aired and televised on February 10,1988: The petitioners said that the haphazard and whimsical and capricious checking should now be stopped once and for all. They said that the nine years formal studies and the one year internship not to mention the expenses and the blood, sweat, and tears of the students and their families will have been rendered nugatory. The petitioners also noted that Com. Francia had promised last January 12 to rectify the errors in the checking and yet they have not received the appropriate action promised whereas the next exams have been set for Feb. 20, 21, 27 and 28. Alleging that the report was false, malicious and one-sided and it exposed them to hatred, contempt and ridicule, the respondents, who are physicians and former members of the Board of Medicine, instituted a damage suit before the RTC of Makati on September 21, 1988. Petitioner contended that the telecast was contextually concise and objective narration of a matter of public concern, thus, it is privileged. The RTC agreed with herein petitioners. However, the Court of Appeals reversed its decision, awarding damages in favour of herein respondents.

Issue: Whether the televised news report is libelous. Held: No, the Court held that what petitioner reported was privileged and thus, the award of damages is untenable. The Court ruled that the subject news report was clearly a fair and true report, a simple narration of the allegations contained in and circumstances surrounding the filing by the unsuccessful examinees of the petition for mandamus before the court, and made without malice. Thus, we find the petitioners entitled to the protection and immunity of the rule on privileged matters under Article 354 (2) of the Revised Penal Code. It follows that they too cannot be held liable for damages sought by the respondents, who, during the period material, were holding public office.

VIII.

The Defendants 27

Joseph Saludaga v Far Eastern University

JOSEPH SALUDAGA, petitioner, vs. FAR EASTERN UNIVERSITY and EDILBERTO C. DE JESUS in his capacity as President of FEU, respondents. G.R. No. 179337 April 30, 2008 FACTS: Petitioner Joseph Saludaga was a sophomore law student of respondent Far Eastern University (FEU) when he was shot by Alejandro Rosete (Rosete), one of the security guards on duty at the school premises on August 18, 1996. Petitioner filed a complaint for damages against respondents on the ground that they breached their obligation to provide students with a safe and secure environment and an atmosphere conducive to learning. Respondents, in turn, filed a Third-Party Complaint7 against Galaxy Development and Management Corporation (Galaxy), the agency contracted by respondent FEU to provide security services within its premises and Mariano D. Imperial (Imperial), Galaxy's President, to indemnify them for whatever would be adjudged in favor of petitioner, if any; and to pay attorney's fees and cost of the suit. RTC ruled in favor of petitioner but CA reversed the lower courts ruling. Thus, this petition. ISSUE:

Whether or not FEU, De Jesus (FEUs president), Rosete (security guard), Galaxy (agency) and Imperial (Galaxys president) should be held liable. HELD: FEU is liable. It is undisputed that petitioner was enrolled as a sophomore law student in respondent FEU. As such, there was created a contractual obligation between the two parties. On petitioner's part, he was obliged to comply with the rules and regulations of the school. On the other hand, respondent FEU, as a learning institution is mandated to impart knowledge and equip its students with the necessary skills to pursue higher education or a profession. It is settled that in culpa contractual, the mere proof of the existence of the contract and the failure of its compliance justify, prima facie, a right of relief. Respondents failed to discharge the burden of proving that they exercised due diligence in providing a safe learning environment for their students. Respondent De Jesus should not be held solidarily liable with respondent FEU because none of the exceptions laid down in Powton Conglomerate, Inc. v. Agcolicol in order for an officer of a corporation to be held liable, was established in the instant case. Evidence duly supports the findings of the trial court that Galaxy is negligent not only in the selection of its employees but also in their supervision. Indeed, no administrative sanction was imposed against Rosete despite the shooting incident; moreover, he was even allowed to go on leave of absence which led eventually to his disappearance. Unlike respondent De Jesus, we deem Imperial to be solidarily liable with Galaxy for being grossly negligent in directing the affairs of the security agency.
Medardo Cadiente v Bithuel Macas Magsaysay 28

MEDARDO AG. CADIENTE v BITHUEL MACAS G.R. NO. 161946 : November 14, 2008 QUISUMBING, Acting C.J.: Facts: On July 19, 1994, at about 4:00 p.m. 15-year old student Bithuel Macas was standing on the shoulder of the road at the intersection of Buhangin and San Vicente Streets. He was bumped and run over by a Ford Fiera, driven by Chona C. Cimafranca. Macas suffered severe muscular and major vessel injuries and the surgeon had to amputate both legs up to the groins in order to save his life. Cimafranca had since absconded and disappeared. Records showed that the Ford Fiera was registered in the name of Atty. Medardo Cadiente. However, Cadiente claimed that when the accident happened, he was no longer the owner of the said Ford Fiera which was already sold to Engr. Jalipa. But there was no transfer of registration happened. The victim's father, Samuel Macas, filed a complaint for torts and damages against Cimafranca and Cadiente.

Issues: (1) Whether or not there was contributory negligence on the part of Macas; and (2) Whether or not the petitioner Cadiente and third-party defendant Jalipa are jointly and severally liable to the victim. Held: (1) None. The victim was standing on the shoulder, which was the uncemented portion of the highway and intended for pedestrian use alone. Running vehicles are not supposed to pass through the said portion of the highway. However, the Ford Fiera, took off from the cemented part of the highway, inexplicably swerved to the shoulder, and recklessly bumped and ran over an innocent victim. The victim was just where he should be when the unfortunate event transpired. (2) Yes. The registered owner of any vehicle, even if he had already sold it to someone else, is primarily responsible to the public for whatever damage or injury the vehicle may cause. Since the Ford Fiera was still registered in the petitioner's name at the time when the misfortune took place, the petitioner cannot escape liability. Atty. Medardo Ag. Cadiente and Engr. Rogelio Jalipa are jointly and severally liable for damages to the plaintiff for their own negligence.
Filipinas Synthetic Fiber Corporation v Wilfredo De Los Santos 29

FILIPINAS SYNTHETIC FIBER CORPORATION VS. WILFREDO DE LOS SANTOS, BENITO JOSE DE LOS SANTOS, MARIA ELENA DE LOS SANTOS AND CARMINA VDA. DE LOS SANTOS G.R. No. 152033, March 16 : 201 PERALTA, J.: FACTS: Teresa Elena Legarda-de los Santos (Teresa Elena), the wife of Wilfredo de los Santos (Wilfredo), performed at the Rizal Theater as a member of the cast for the musical play, Woman of the Year. Wilfredos brother Armando de los Santos (Armando), husband of Carmina Vda. de los Santos, went to the Rizal Theater to fetch Teresa Elena after the latter's performance. He drove a 1980 Mitsubishi Galant Sigma (Galant Sigma), company car assigned to Wilfredo. At Katipunan Road (White Plains), the Galant Sigma collided with the shuttle bus owned by petitioner and driven by Alfredo S. Mejia (Mejia), an employee of petitioner. The Galant Sigma was dragged about 12 meters from the point of impact, across the White Plains Road landing

near the perimeter fence of Camp Aguinaldo, where the Galant Sigma burst into flames and burned to death beyond recognition all four occupants of the car. A criminal charge for reckless imprudence resulting in damage to property with multiple homicide was brought against Mejia, which was decided in favor of Mejia. RTC: decided in favor of respondents. WHEREFORE, in view of the foregoing this Court finds Filipinas Synthetic Fiber Corporation and Alfredo S. Mejia, defendants in both cases, jointly and severally, to pay the herein plaintiffs damages. CA: Decision of RTC AFFIRMED. ISSUE: (1) Whether or not SFC exercise the due diligence of a good father of a family in the selection and supervision of its employees; (2) Whether or not Mejia was negligent and therefore liable for damages HELD: The petition lacks merit. Petitioner insists that it exercised the due diligence of a good father of a family in the selection and supervision of its employees. Under Article 2180 of the New Civil Code, when an injury is caused by the negligence of the employee, there instantly arises a presumption of law that there was negligence on the part of the master or employer either in the selection of the servant or employee, or in supervision over him after selection or both. The liability of the employer under Article 2180 is direct and immediate; it is not conditioned upon prior recourse against the negligent employee and a prior showing of the insolvency of such employee. Due diligence in the supervision of employees on the other hand, includes the formulation of suitable rules and regulations for the guidance of employees and the issuance of proper instructions intended for the protection of the public and persons with whom the employer has relations through his or its employees and the imposition of necessary disciplinary measures upon employees in case of breach or as may be warranted to ensure the performance of acts indispensable to the business of and beneficial to their employer. To this, we add that actual implementation and monitoring of consistent compliance with said rules should be the constant concern of the employer, acting through dependable supervisors who should regularly report on their supervisory functions. In order that the defense of due diligence in the selection and supervision of employees may be deemed sufficient and plausible, it is not enough to emptily invoke the existence of said company guidelines and policies on hiring and supervision. As the negligence of the employee

gives rise to the presumption of negligence on the part of the employer, the latter has the burden of proving that it has been diligent not only in the selection of employees but also in the actual supervision of their work. The mere allegation of the existence of hiring procedures and supervisory policies, without anything more, is decidedly not sufficient to overcome such presumption.
IX. Strict Liability 30

Emilio Gancayco v City Government of QC and MMDA

GANCAYCO vs CITY GOVERNMENT OF QUEZON CITY AND METRO MANILA DEVELOPMENT AUTHORITY G.R. No. 177807 October 11, 2011 SERENO, J.: Facts: In the early 1950s, retired Justice Emilio A. Gancayco bought a parcel of land located at 746 EDSA covered by Transfer Certificate of Title (TCT) No. RT114558. On 27 March 1956, the Quezon City Council issued Ordinance No. 2904 which required the relevant property owner to construct an arcade with a width of 4.50 meters and height of 5.00 meters along EDSA, from the north side of Santolan Road to one lot after Liberty Avenue, and from one lot before Central Boulevard to the Botocan transmission line. The ordinance covered the property of Justice Gancayco. Subsequently, sometime in 1965, Justice Gancayco sought the exemption of a two-storey building being constructed on his property from the application of Ordinance No. 2904 that he be exempted from constructing an arcade on his property. The City Council acted favorably on Justice Gancaycos request and issued Resolution No. 7161, S-66, subject to the condition that upon notice by the City Engineer, the owner shall, within reasonable time, demolish the enclosure of said arcade at his own expense when public interest so demands. Decades after, in 2003, the Metropolitan Manila Development Authority (MMDA) conducted operations to clear obstructions along the sidewalk of EDSA in Quezon City pursuant to Metro Manila Councils (MMC) Resolution No. 02-28, Series of 2002. The resolution authorized the MMDA and local government units to clear the sidewalks, streets, avenues, alleys, bridges, parks and other public places in Metro Manila of all illegal structures and obstructions. On 28 April 2003, the MMDA sent a notice of demolition to Justice Gancayco alleging that a portion of his building violated the National Building Code of the Philippines (Building Code) in relation to Ordinance No. 2904. The MMDA gave Justice Gancayco fifteen (15) days to clear the portion of the building that was supposed to be an arcade along EDSA.

Justice Gancayco did not comply with the notice. Soon after the lapse of the fifteen (15) days, the MMDA proceeded to demolish the party wall. At the time of the demolition, the affected portion of the building was being used as a restaurant. Justice Gancayco filed a Petition for a temporary restraining order and/or writ of preliminary injunction seeking to prohibit the MMDA and the City Government of Quezon City from demolishing his property. In his Petition, he alleged that the ordinance authorized the taking of private property without due process of law and just compensation and that the ordinance was selective and discriminatory in its scope and application. He thus sought the declaration of nullity of Ordinance No. 2904 and the payment of damages. Alternately, he prayed for the payment of just compensation should the court hold the ordinance valid. The City Government of Quezon City claimed that the ordinance was a valid exercise of police power, regulating the use of property in a business zone. In addition, it pointed out that Justice Gancayco was already barred by estoppel, laches and prescription. Similarly, the MMDA alleged that Justice Gancayco could not seek the nullification of an ordinance that he had already violated, and that the ordinance enjoyed the presumption of constitutionality. It further stated that the questioned property was a public nuisance impeding the safe passage of pedestrians. Finally, the MMDA claimed that it was merely implementing the legal easement established by the ordinance No. 2904. The RTC rendered its decision in favor of Justice Gancayco. It held that the questioned ordinance was unconstitutional, ruling that it allowed the taking of private property for public use without just compensation. The Court of Appeals (CA) partly granted the appeal. It upheld the validity of ordinance lifted the injunction against the enforcement and implementation of the ordinance. Nevertheless, the CA held that the MMDA went beyond its powers when it demolished the subject property. ISSUE: Whether or not the wing wall of Justice Gancaycos building is a public nuisance. HELD: Yes. The wing walls of the building are not nuisances per se. The fact that in 1966 the City Council gave Justice Gancayco an exemption from constructing an arcade is an indication that the wing walls of the building are not nuisances per se. The wing walls do not per se immediately and adversely affect the safety of persons and property. The fact that an ordinance may declare a structure illegal does not necessarily make that structure a nuisance. Article 694 of the Civil Code defines nuisance as any act, omission, establishment, business, condition or property, or anything else that (1) injures or endangers the health or safety of others; (2) annoys or offends the senses; (3) shocks, defies or disregards decency or morality; (4) obstructs or interferes with the free passage of any public highway or street, or any body of

water; or, (5) hinders or impairs the use of property. A nuisance may be per se or per accidens. A nuisance per se is that which affects the immediate safety of persons and property and may summarily be abated under the undefined law of necessity. Clearly, when Justice Gancayco was given a permit to construct the building, the city council or the city engineer did not consider the building, or its demolished portion, to be a threat to the safety of persons and property. This fact alone should have warned the MMDA against summarily demolishing the structure. Neither does the MMDA have the power to declare a thing a nuisance. Only courts of law have the power to determine whether a thing is a nuisance.
X. Damages 31

Ariel Santos v People

Santos vs. PEOPLE OF THE PHILIPPINES G.R. No. 161877, March 23, 2006 Facts: Petitioner Ariel Santos y Cadiente, then the Labor Arbiter of the National Labor Relations Commission (NLRC), Regional Arbitration Branch No. III, San Fernando, Pampanga, was charged with violation of Section 3(e) of Republic Act (R.A.) No. 3019, as amended, otherwise known as the Anti-Graft and Corrupt Practices Act. That on March 11, 1993 and June 15, 1993 respectively, in San Fernando, Pampanga, the abovenamed accused, being then the Labor Arbiter of the [NLRC], Regional Arbitration Branch No. III, San Fernando, Pampanga, while in the performance of his quasi-judicial functions, taking advantage of his position and committing the offense in relation to his office, did then and there willfully, unlawfully, criminally and through evident bad faith and manifest partiality towards Abraham Mose, complainant in NLRC-RAB Case No. RO3-198-79 captioned Abraham Mose vs. Plaza Hotel/Apartments, cause undue injury to Conrado L. Tiu, the owner of the Plaza Hotel/Apartments, in the following manner: accused despite the pendency of the motion for reconsideration of his Order dated October 21, 1992 directing the issuance of a writ of execution and the opposition to the motion for execution as well as the motion to quash writ of execution, issued first a writ of execution dated March 11, 1993 followed by an alias writ of execution dated June 15, 1993, without acting on the said motions and opposition anymore, and as a consequence thereof, undue injury was caused to Conrado L. Tiu while giving unwarranted benefit and advantage to Abraham Mose. In the same decision, the Sandiganbayan (Third Division) adjudged petitioner guilty as charged and, accordingly, sentenced him. Issue:

Whether or not the act of petitioner was tainted with or attended by evident partiality causing undue injury to private complainant Conrado L. Tiu. Held: The case was dismissed. According to the court the term undue injury in the context of Section 3 (e) of the Anti-Graft and Corrupt Practices Act punishing the act of "causing undue injury to any party," has a meaning akin to that civil law concept of actual damage. The Court said so in Llorente vs. Sandiganbayan, thus: In jurisprudence, undue injury is consistently interpreted as actual damage. Undue has been defined as more than necessary, not proper, [or] illegal; and injury as any wrong or damage done to another, either in his person, rights, reputation or property [; that is, the] invasion of any legally protected interest of another. Actual damage, in the context of these definitions, is akin to that in civil law. In turn, actual or compensatory damages is defined by Article 2199 as, "Except as provided by law or by stipulation, one is entitled to an adequate compensation only for such pecuniary loss suffered by him as he has duly proved. Such compensation is referred to as actual or compensatory damages. Fundamental in the law on damages is that one injured by a breach of a contract, or by a wrongful or negligent act or omissionshall have a fair and just compensation commensurate to the loss sustained as a consequence of the defendants act. Actual pecuniary compensation is awarded as a general rule, . Actual damages are primarily intended to simply make good or replace the loss caused by the wrong. Petitioner admitted issuing the two writs of execution without first resolving Plaza Hotel's motion for reconsideration of his October 21, 1992 Order. He argued, however, that it was his ministerial duty to issue the writs aforementioned, the finality of the decision sought to be enforced, i.e., the decision of Labor Arbiter Palumbarit, having set in upon the dismissal, with finality, by this Court of Plaza Hotels petition for certiorari in G.R. No. 77105 assailing said decision. From the foregoing narration of events, it is fairly clear that Plaza Hotels motion for reconsideration immediately referred to above was directed against petitioners order of October 21, 1992 directing the issuance of a writ of execution for the amount stated therein. Be this as it may, petitioners pose respecting his ministerial duty to order the execution of a final and executory decision of Andres Palumbarit is as simplistic as it is misleading. As it were, petitioner failed to resolve said motion for reconsideration and instead issued on March 11, 1993 a writ of execution. Worse still, he proceeded to issue an alias writ of execution despite the issuance by the NLRC Proper of a TRO enjoining the implementation of the underlying writ. Under the circumstances, Plaza Hotel was within its right to secure the services of counsel - for a fee of P68,500.00 - and, to apply for injunctive relief and then pay P11,800.00 for the supersedeasbond to stay the implementation of the writ of execution in question. In net

effect, Plaza Hotel incurred damages rendered necessary by the illegal or improper acts of petitioner. Petitioner, being a labor arbiter of the NLRC, discharges quasi-judicial functions. His act of issuing the two writs of execution without first resolving the pending motion for reconsideration of his October 21, 1992 Order, and despite the existence of a TRO was clearly tainted with or attended by evident partiality causing undue injury to private complainant Conrado L. Tiu.
Marikina Auto Line Transport Corp. v People 32

Marikina Auto Line Transport Corp. v People G.R. No. 152040. Mar 31, 2006 Callejo, Sr., J.: FACTS: Erlinda V. Valdellon is the owner of a two-door commercial apartment located at No. 31 Kamias Road, Quezon City. The Marikina Auto Line Transport Corporation (MALTC) is the owneroperator of a passenger bus with Plate Number NCV-849. Suelto, its employee, was assigned as the regular driver of the bus. At around 2:00 p.m. on October 3, 1992, Suelto was driving the aforementioned passenger bus along Kamias Road, Kamuning, Quezon City, going towards Epifanio de los Santos Avenue (EDSA). The bus suddenly swerved to the right and struck the terrace of the commercial apartment owned by Valdellon located along Kamuning Road. Valdellon demanded payment of P148,440.00 to cover the cost of the damage to the terrace. The bus company and Suelto offered a P30,000.00 settlement which Valdellon refused. Valdellon filed a criminal complaint for reckless imprudence resulting in damage to property against Suelto. Valdellon also filed a separate civil complaint against Suelto and the bus company for damages. Suelto maintained that, in an emergency case, he was not, in law, negligent. Both the trial court and the CA ruled in against herein petitioners. ISSUE: WON the sudden emergency rule applies in the case at bar. HELD: It was the burden of petitioners herein to prove petitioner Sueltos defense that he acted on an emergency, that is, he had to swerve the bus to the right to avoid colliding with a passenger jeep coming from EDSA that had overtaken another vehicle and intruded into the lane of the bus. The sudden emergency rule was enunciated by this Court in Gan v. Court of Appeals,23 thus: [O]ne who suddenly finds himself in a place of danger, and is required to act without time to consider the best means that may be adopted to avoid the impending danger, is not guilty of

negligence if he fails to adopt what subsequently and upon reflection may appear to have been a better method unless the emergency in which he finds himself is brought about by his own negligence. Under Section 37 of Republic Act No. 4136, as amended, otherwise known as the Land Transportation and Traffic Code, motorists are mandated to drive and operate vehicles on the right side of the road or highway: SEC. 37. Driving on right side of highway. Unless a different course of action is required in the interest of the safety and the security of life, person or property, or because of unreasonable difficulty of operation in compliance herewith, every person operating a motor vehicle or an animal-drawn vehicle on a highway shall pass to the right when meeting persons or vehicles coming toward him, and to the left when overtaking persons or vehicles going the same direction, and when turning to the left in going from one highway to another, every vehicle shall be conducted to the right of the center of the intersection of the highway. Section 35 of the law provides, thus: Sec. 35. Restriction as to speed.(a) Any person driving a motor vehicle on a highway shall drive the same at a careful and prudent speed, not greater nor less than is reasonable and proper, having due regard for the traffic, the width of the highway, and of any other condition then and there existing; and no person shall drive any motor vehicle upon a highway at such a speed as to endanger the life, limb and property of any person, nor at a speed greater than will permit him to bring the vehicle to a stop within the assured clear distance ahead. In relation thereto, Article 2185 of the New Civil Code provides that "unless there is proof to the contrary, it is presumed that a person driving a motor vehicle has been negligent, if at the time of mishap, he was violating any traffic regulation." By his own admission, petitioner Suelto violated the Land Transportation and Traffic Code when he suddenly swerved the bus to the right, thereby causing damage to the property of private respondent. However, the trial court correctly rejected petitioner Sueltos defense, in light of his contradictory testimony vis--vis his Counter-Affidavit submitted during the preliminary investigation: It is clear from the photographs submitted by the prosecution (Exhs. C, D, G, H & I) that the commercial apartment of Dr. Valdellon sustained heavy damage caused by the bus being driven by Suelto. "It seems highly improbable that the said damages were not caused by a strong impact. And, it is quite reasonable to conclude that, at the time of the impact, the bus was traveling at a high speed when Suelto tried to avoid the passenger jeepney." Such a conclusion finds support in the decision of the Supreme Court in People vs. Ison, 173 SCRA 118, where the Court stated that "physical evidence is of the highest order. It speaks more eloquently than a hundred witnesses." The pictures submitted do not lie, having been taken immediately after the

incident. The damages could not have been caused except by a speeding bus. Had the accused not been speeding, he could have easily reduced his speed and come to a full stop when he noticed the jeep. Were he more prudent in driving, he could have avoided the incident or even if he could not avoid the incident, the damages would have been less severe.
Bankard Inc. v Dr. Antonio Novak Feliciano 33

Bankard Inc. v Dr. Antonio Novak Feliciano G.R. No. 141761, July 28, 2006 PUNO, J.: FACTS: Dr. Antonio Feliciano is the holder of PCIBank Mastercard and an extension card was issued to his wife, Mrs. Marietta N. Feliciano. On June 19, 1995, respondent used his PCIBank Mastercard to pay a breakfast bill in Canada but the card was dishonored for payment. He found out that according to the bank, he failed to pay his last billing which he denied. He called his secretary in the Philippines to verify the payment. The following day, respondent met with Dr. Bumanlag to reimburse her for the cost of the breakfast the previous day. Thereafter, Dr. Bumanlag accompanied the respondent to a prestigious mall in Toronto, where the latter bought several dressing items. Respondent presented the same card for payment which was dishonored to the embarrassment of Feliciano. Worse, the manager of the department store confiscated the card in front of Dr. Bumanlag and other shoppers. On October 5, 1995, respondent filed a case against the bank. On July 22, 1997, the trial court decided the case in favor of respondent. Although the claim for actual damages was disallowed for lack of proof, petitioner was ordered to pay:(1) P1,000,000.00 as moral damages, (2)P200,000.00 as exemplary damages, and (3) P100,000.00 for attorneys fees and costs of suit. Petitioner was likewise ordered to restore respondents good name with the merchant establishment in Canada which confiscated his Mastercard, and to return the card with apologies to respondent. Petitioner filed a petition for review with the Court of Appeals which affirmed the lower courts decision. ISSUE: WON Bankard is liable to Dr. Feliciano for damages HELD: YES. Petitioner alleged that it suspended the privileges of respondent's credit card only after it received the fraud alert from Indonesia, and after its fraud analyst, Mr. Lopez, tried to contact both the respondent and his wife at his clinic and at home. At first blush, bad faith or malice appears not to be attributable to petitioner. However, we find that its efforts at personally contacting respondent regarding the suspension of his credit card fall short of the degree of diligence required by the circumstances. Petitioner claims that it suspended respondent's card to protect him from fraudulent transactions. While petitioner's motive has to be lauded, we find it lamentable that petitioner was not equally zealous in protecting respondent from potentially

embarrassing and humiliating situations that may arise from the unsuspecting use of his suspended PCIBank Mastercard. Considering the widespread use of access devices in commercial and other transactions, petitioner and other issuers of credit cards should not only guard against fraudulent uses of credit cards but should also be protective of genuine uses thereof by the true cardholders. In the case at bar, the duty is much more demanding for the evidence shows that respondent is a credit cardholder for more than ten (10) years in good standing, and has not been shown to have violated any of the provisions of his credit card agreement with petitioner. Considering the attendant circumstances, we find petitioner to have been grossly negligent in suspending respondent's credit card. To reiterate, moral damages may be awarded in a breach of contract when the defendant acted fraudulently or in bad faith, or is guilty of gross negligence amounting to bad faith.
Asian Construction and Development Corp. v COMFAC Corp. 34

ASIAN CONSTRUCTION AND DEVELOPMENT CORPORATION vs COMFAC CORPORATION G.R. No. 163915 October 12, 2006 FACTS: ASIAKONSTRUCT awarded respondent COMFAC Corporation a contract for raised flooring system for the PNOC-EDC, LGPP HVAC Marshalling Station Building, in Leyte and another contract for airconditioning and ventilation system for the PNOC-EDC Marshalling and Relay Building of Leyte HVAC Switchyard Project, costing P1,698,635 and P4,000,000, respectively. In November 1996, COMFAC turned over the project to PNOC, and issued the Certificates of Completion, which were confirmed by Rene T. Soriao, Group Manager of ASIAKONSTRUCT. COMFAC then sent ASIAKONSTRUCT demand letters for the unpaid balance of P1,969,863.50. However, ASIAKONSTRUCT failed to pay the amount, prompting COMFAC to file a complaint for collection. It also prayed for attorneys fees equivalent to 20% of the amount demanded, plus P2,000 attorneys fee per appearance, and exemplary damages of P500,000. The trial court rendered judgment in favor of the COMFAC. ASIAKONSTRUCT elevated the case to the Court of Appeals with certain modifications on the amount of damages to be awarded. ISSUE: Whether or not the respondent is entitled to attorneys fees HELD: Attorneys fees cannot be awarded. Attorneys fees are not to be awarded every time a party wins a suit. Article 2208 of the Civil Code demands factual, legal and equitable justifications for the award of attorneys fees and its basis cannot be left to speculation and conjecture. Attorney's fee

is allowed when a claimant is compelled to litigate with third persons or incur expenses to protect his interest by reason of an unjustified act or omission on the part of the party from whom it is sought. Indeed, COMFAC was forced to litigate to collect payments, but due to lack of findings on the amount to be awarded, and since there is no sufficient showing of bad faith in ASIAKONSTRUCTs refusal to pay, other than an erroneous assertion of the righteousness of its cause, the attorneys fee cannot be awarded against it.
Philippine National Railways v Ethel Brunty and Juan Manuel Garcia 35

PHILIPPINE NATIONAL RAILWAYS vs. ETHEL BRUNTY and JUAN MANUEL M. GARCIA G.R. No. 169891 November 2, 2006 FACTS: Rhonda Brunty, daughter of respondent and an American citizen, came to the Philippines for a visit sometime in January 1980. Prior to her departure, she, together with her Filipino host Juan Garcia, traveled to Baguio City on board a sedan, driven by Mercelita around midnight. Driving at approximately 70 km/hr, and unaware of the railroad track up ahead, they collided with PNR Train No. T-71. Mercelita was instantly killed when the sedan smashed into the train; the two other passengers suffered serious physical injuries. Rhonda Brunty was brought to a Hospital in Tarlac, where she was pronounced dead after ten minutes from arrival. Garcia, who had suffered severe head injuries, was brought via ambulance to the same hospital but then was transferred to two other hospitals for further treatment. Ethel Brunty then sent a demand letter to the PNR demanding payment of actual, compensatory, and moral damages, as a result of her daughters death. When PNR did not respond, Ethel Brunty and Garcia, filed a complaint for damages against the PNR. They alleged that the death of Mercelita and Rhonda Brunty, as well as the physical injuries suffered by Garcia, were the direct and proximate result of the gross and reckless negligence of PNR in not providing the necessary equipment at the railroad crossing. Plaintiffs likewise averred that PNR failed to supervise its employees in the performance of their respective tasks and duties, more particularly the pilot and operator of the train. The RTC rendered its Decision in favor of plaintiffs. The CA affirmed the decision but with partial modifications increasing the death indemnity award from P30,000.00 to P50,000.00, and deleting the award for damages sustained by the sedan. ISSUE: Whether or not the court erred in awarding the damages HELD:

No but a modification of the same is in order, specifically on the award of actual and moral damages in the aggregate amount of P1,000,000.00. Actual or compensatory damages are those awarded in order to compensate a party for an injury or loss he suffered. They arise out of a sense of natural justice, aimed at repairing the wrong done. To be recoverable, they must be duly proved with a reasonable degree of certainty. A court cannot rely on speculation, conjecture, or guesswork as to the fact and amount of damages, but must depend upon competent proof that they have suffered, and on evidence of the actual amount thereof. Respondents, however, failed to present evidence for such damages; hence, the award of actual damages cannot be sustained. However, as the heirs of Rhonda Brunty undeniably incurred expenses for the wake and burial of the latter, we deem it proper to award temperate damages in the amount of P25,000.00 pursuant to prevailing jurisprudence. Moral damages are not punitive in nature, but are designed to compensate and alleviate in some way the physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation, and similar injury unjustly caused a person. Although incapable of pecuniary computation, moral damages must nevertheless be somehow proportional to and in approximation of the suffering inflicted. In the instant case, the moral suffering of the heirs of Rhonda Brunty was sufficiently established by Ethel Brunty in her deposition, Considering the circumstances attendant in this case, we find that an award of P500,000.00 as moral damages to the heirs of Rhonda Brunty is proper. In view of recent jurisprudence, indemnity of P50,000.00 for the death of Rhonda Brunty and attorneys fees amounting to P50,000.00 is likewise proper.
Conrado Magbanua et al. v PilarJunsay et al. 36

G.R. No. 132659 February 12, 2007 CONRADO MAGBANUA and ROSEMARIE MAGBANUA-TABORADA, the latter assisted by her husband ARTEMIO TABORADA,Petitioners, vs. PILAR S. JUNSAY, assisted by her husband VICENTE JUNSAY, IBARRA LOPEZ, and JUANITO JACELA, CHICO-NAZARIO, J.: Facts: Petitioner Rosemarie Magbanua, who worked as a housemaid in the residence of complainant and herein respondent Pilar S. Junsay was charged as a co-accused with the crime of Robbery. Petitioner was acquitted by the trial court. Petitioner Rosemarie Magbanua filed a complaint for damages for malicious prosecution against respondent Junsay. Allegedly, due to respondents false, malicious, and illegal actuations, the latter suffered untold pain, shame, humiliation, worry, and mental anguish. Petitioners

maintained that Rosemarie suffered physical pain and mental torture due to the filing of the false criminal charge against her. On 25 July 1995, the RTC rendered a Decision dismissing the Complaint. The RTC applied the established rule that for a malicious prosecution suit to succeed, two indispensable elements must be shown to exist, to wit: (a) malice and (b) absence of probable cause. It found that the elements were not successfully shown by petitioners. It held that the mere filing of a suit does not render a person liable for malicious prosecution should he be unsuccessful for the law could not have meant to impose a penalty on the right to litigate. Issue: Whether or not respondent is liable for malicious prosecution Held: No. To constitute malicious prosecution, however, there must be proof that the prosecution was prompted by a sinister design to vex and humiliate a person, and that it was initiated deliberately by the defendant knowing that his charges were false and groundless. Concededly, the mere act of submitting a case to the authorities for prosecution does not make one liable for malicious prosecution. The four elements that must be shown to concur to recover damages for malicious prosecution. Therefore, for a malicious prosecution suit to prosper, the plaintiff must prove the following: (1) the prosecution did occur, and the defendant was himself the prosecutor or that he instigated its commencement; (2) the criminal action finally ended with an acquittal; (3) in bringing the action, the prosecutor acted without probable cause; and (4) the prosecution was impelled by legal malice -- an improper or a sinister motive. Applying the rule to the case at bar, we affirm the findings of the RTC and the Court of Appeals that there was no proof of a sinister design on the part of the respondents to vex or humiliate petitioner Rosemarie by instituting the criminal case against her and her co-accused. Respondent Pilar who was robbed of her valuable belongings can only be expected to bring the matter to the authorities. There can be no evil motive that should be attributed to one, who, as victim of a crime institutes the necessary legal proceedings.
Manila Electric Company v Ma. Victoria Jose 37

MANILA ELECTRIC COMPANY v Ma. Victoria Jose (GR No. 152769, February 14, 2007) FACTS: Victoria has been a MERALCO customer since 1987 with service address Quezon City. On July 14, 1995, Meralco Polyphase Inspector Santiago Inoferio visited the residence of Victoria to conduct an inspection. After inspection, Inoferio issued a Service Inspection Report where he

stated that there was a burned out insulation. Inoferio recommended that Victorias billing be adjusted and her record updated. On October 3, 1995, Meralco issued to Victoria a differential adjustment billing for P232,385.20. According to MERALCO, this defect caused the meter not to register the correct KWH consumption registering only 50% of the consumption. Victoria requested Meralco to reconsider its finding on the ground that the defect was a fortuitous event and that it was due to the negligence of Meralco personnel that the defects were not earlier detected and repaired. Meralco did not accede to her request but offered an installment payment scheme. Victoria refused to pay the billing adjustment. On November 21, 1995, she received from Meralco an Overdue Account Notice which contains a reminder that if she fails settle her account, they will disconnect her from their electric services. Victoria filed with RTC, Quezon City, a Complaint for Injunction with Damages and Writ of Preliminary Injunction. After trial, Victoria prevailed with an award Moral and Exemplary damages for P500,000.00 each and attorney's fees. Meralco appealed to CA which affirmed the trial court. ISSUE: Whether CA erred in holding that MERALCO is liable for Moral and Exemplary damages And attorney's fees. RULING: The Court ruled that the awarded moral and exemplary damages were excessive. It was reduced to P100,000.00 and P50,000.00. Meralcos gross negligence* in the maintenance of its devices and equipment and its arbitrary issuance of a differential billing to Victoria brought upon the latter much anxiety and aggravation. It should therefore be liable to her for moral damages. It should also be liable for exemplary damages to curb similar arbitrary practices. However, the Court found that the award of both damages to be excessive. Moral damages and exemplary damages are not intended to enrich the complainant in order to punish the defendant. Moral damages are for reparation of the spiritual status quo ante; a means to assuage the moral suffering of the complainant brought about by the culpable action of the defendant. The award of moral damages must then be commensurate to the suffering or proportionate to the wrong committed. An award of P100,000.00 approximates the anxiety suffered by Victoria. As to exemplary damages, the purpose in holding a defendant liable for it is deterrence. Meralco must curb its callousness toward its customers and its inattention to its duty of keeping its facilities and equipment well maintained. The Court hold that the award of P50,000.00 would suffice. (*Meralco acknowledged that the standard precaution it should take in the maintenance of its electric meters is to subject the same to polyphase meter test twice every year. It appears, however, that with reference to Meter No. 31D551-57, the same was subjected to polyphase meter test for the first time in 1995, or seven years from its installation in 1987. Such delay in inspection constitutes gross negligence on the part of Meralco in the maintenance of said electric meter; thus, it should bear sole liability for any loss arising from the defects in said meter, including any unregistered and unbilled electric consumption.)

People v Rolando Cabinan

38

PEOPLE OF THE PHILIPPINES V. ROLANDO CABINAN G.R. No. 176158, March 27, 2007 FACTS: On December 13, 2000, between 9:00 oclock and 10:00 oclock in the evening, victim Eleuterio Lucas was having a drinking spree at his residence in upper Bigte, Norzagaray, Bulacan with a group that included his brother, his bestfriend and Orlando Cabinan, brother of the accusedappellant. A commotion broke out after an altercation ensued between Eleuterios bestfriend and Orlando Cabinan. Eleuterio tried to pacify them. Orlando then left the place and went to a nearby billiard hall where his brother, accused-appellant Rolando Cabinan, was playing billiards. Orlando told the accused-appellant about the fight and immediately, the two (2) brothers proceeded to the house of Eleuterio. When the Cabinan brothers reached Eleuterios house, Orlando had a fistfight with one of the guests of victim Eleuterio. Eleuterio again tried to diffuse the fight, but accused-appellant Rolando threw the bottle of gin he was holding, hitting Eleuterio on the head. The bottle exploded due to the impact. Accused-appellant ran away after the explosion. Victim Eleuterio, on the other hand, was rushed to the hospital, but because of the injuries he sustained, he died at the East Avenue Medical Center in Quezon City. Only the accused-appellant testified for his defense. He alleged that when he threw the bottle, it exploded to his own surprise. He then ran away from the scene of the fight. He also claims he had no intention of killing the victim when he threw the gin bottle at him; that he wanted to diffuse the fight between Roberto and Eleuterio hence he threw the bottle, unaware that it contained explosives. The prosecution, along with the victims family, adamantly prays for damages and other civil indemnities. The lower courts found him guilty of Murder. Hence, this appeal. ISSUE: Whether or not the respondent is liable for damages HELD: Accused-appellants claim that he did not know that the bottle of gin was actu ally an explosive fails to persuade. He admitted having been at the scene of the crime because his brother sought his help after a mauling incident in Liwasan, Norzagaray. Evidently, he went to the crime scene purposely to take vengeance for his brother. If he really wanted to stop a duel he witnessed when he arrived there, then he could have resorted to peaceful and reasonable means to achieve this purpose. The circumstances that, first, the bottle of gin thrown against the victim turned out to be an explosive, and second, the victim was hit exactly in the head are clear indicators of the malicious intent of the accused-appellant. We agree with the trial court that appellant is guilty of murder. Appellants attack was treacherous; it was sudden and made from behind, catching the victim unaware and unable to defend himself.

The heirs of the victim are entitled to the amount of P50,000.00 as civil indemnity, which is mandatory and is granted without need of any evidence or proof of damages other than the commission of the crime. They are likewise entitled to the award of moral damages in view of the violent death of the victim and the resultant grief of his family. The award of actual damages was without basis as the heirs of the victim failed to submit documentary evidence to substantiate their claim. In lieu thereof, temperate damages, in the amount of P25,000.00, must be awarded considering that it was established that Eleuterios family incurred expenses for his hospitalization and burial. Finally, exemplary damages should also have been awarded to the heirs of the victim since the qualifying circumstance of treachery was established by the prosecution. If a crime is committed with an aggravating circumstance, either qualifying or generic, an award of P25,000.00 as exemplary damages is justified under Article 2230 of the New Civil Code. This kind of damage is intended to serve as a deterrent to serious wrongdoings, and as a vindication of undue sufferings and wanton invasion of the rights of an injured or a punishment for those guilty of outrageous conduct.
Emmanuel Aznar v Citibank NA (Philippines) 39

EMMANUEL B. AZNAR V. CITIBANK N.A. PHILIPPINES G.R. No. 164273, March 28, 2007 FACTS: Emmanuel B. Aznar (Aznar), a known businessman in Cebu, is a holder of a Preferred Master Credit Card (Mastercard) bearing number 5423-3920-0786-7012 issued by Citibank with a credit limit of P150,000.00. As he and his wife, Zoraida, planned to take their two grandchildren, Melissa and Richard Beane, on an Asian tour, Aznar made a total advance deposit of P485,000.00 with Citibank with the intention of increasing his credit limit toP635,000.00. With the use of his Mastercard, Aznar purchased plane tickets to Kuala Lumpur for his group worth P237,000.00. On July 17, 1994, Aznar, his wife and grandchildren left Cebu for the said destination. Aznar claims that when he presented his Mastercard in some establishments in Malaysia, Singapore and Indonesia, the same was dishonored and when he tried to use the same in Ingtan Tour and Travel Agency (Ingtan Agency) in Indonesia to purchase plane tickets to Bali, it was again dishonored for the reason that his card was blacklisted by Citibank. Such dishonor forced him to buy the tickets in cash. He further claims that his humiliation caused by the denial of his card was aggravated when Ingtan Agency spoke of swindlers trying to use blacklisted cards. Aznar and his group returned to the Philippines on August 10, 1994. Aznar filed a motion to re-raffle the case alleging impartiality of the president judge. The new judge ruled in favor of Aznar. On appeal, the Court of Appeals ruled in favor of CITIBANK and held that Aznar had no personal knowledge of the blacklisting of his card and only presumed the same when it was dishonored in certain establishments; that such dishonor is not sufficient to prove that his card was blacklisted. ISSUE:

Whether or not Aznar has established his claim against CITIBANK in the case at bar HELD: Aznar failed to prove with a preponderance of evidence that CITIBANK blacklisted his card or place the same on the hot list. Aznar in his testimony admitted that he had no personal knowledge that his card was blacklisted by CITIBANK and only presumed such fact from the dishonor of his card. It is settled that in order that a plaintiff may maintain an action for damages of which he complains, he must establish that such injuries resulted from a breach of duty which the defendant owed to the plaintiff a concurrence of injury to the plaintiff and legal responsibility by the person causing it. The underlying basis for the award of tort damages is the premise that an individual was injured in contemplation of law; thus there must first be a breach before damages may be awarded and the breach of such duty should be the proximate cause of the injury. It is not enough that one merely suffered sleepless nights, mental anguish or serious anxiety as a result of the actuations of the other party. It is also required that a culpable act or omission was factually established, that proof that the wrongful act or omission of the defendant is shown as the proximate cause of the damage sustained by the claimant and that the case is predicated on any of the instances expressed or envisioned by Arts. 2219 and 2220 of the Civil Code. In culpa contractual or breach of contract, moral damages are recoverable only if the defendant has acted fraudulently or in bad faith, or is found guilty of gross negligence amounting to bad faith, or in wanton disregard of his contractual obligations. The breach must be wanton, reckless, malicious or in bad faith, oppressive or abusive. While the Court commiserates with Aznar for whatever undue embarrassment he suffered when his credit card was dishonored by Ingtan Agency, especially when the agencys personnel insinuated that he could be a swindler trying to use blacklisted cards, the Court cannot grant his present petition as he failed to show by preponderance of evidence that Citibank breached any obligation that would make it answerable for said suffering. Petition denied.
Philippine Commercial International Bank v Joseph Anthony Alejandro 40

PCIB v. Alejandro GR No. 175587 September 21, 2007 Facts: Respondent, a resident of Hong Kong, executed a promissory note in favor of petitioner. In view of the fluctuations in the foreign exchange rates which resulted in the insufficiency of deposits assigned by respondent as security for the loan, petitioner requested the latter to put up additional security for the loan. Respondent, however, sought a reconsideration of said request pointing out petitioner's alleged mishandling of his account due to its failure to carry out his instructions. Subsequently, petitioner filed a Complaint for Sum of Money with prayer for

issuance of a writ for preliminary attachment. The trial court granted the application and issued the writ ex parte. Respondent filed a motion to quash the writ contending that the withdrawal of his unassigned deposits was not fraudulent as it was approved by the petitioner. The trial court issued an order quashing the writ. Issue: WON petitioner is liable for damages for the improper issuance of the writ of preliminary attachment against respondent. Held: Petitioner is liable for damages. Anent the actual damages, the CA is correct in not awarding the same inasmuch as the respondent failed to establish the amount garnished by the petitioner. Nevertheless, nominal damages may be awarded to a plaintiff whose right has been violated or invaded by the defendant, for the purpose of vindicating or recognizing that right, and for indemnifying the plaintiff for any loss suffered by him. In this case, the award of nominal damages is proper considering that the right of respondent to use his money has been violated by its garnishment.
Manila Electric Company v TEAM Electronics Corp et al 41

Manelco v. TEAM electronics corporation GR No. 131723 December 13, 2007 Facts: Respondent TEAM enetered into a Contract of lease with respondent Ultra for the use of the former's DCIM building until September 1991. A year thereafter, a team of petitioner's inspectors conducted a surprise inspection of the electric meters installed in the DCIM building and found the same to be tampered with and did not register the actual power consumption of the building. Petitioner informed TEAM ofthe results and demanded for payment. TEAM referred the demand letter to ULtra which, in turn, informed TEAM that its Executive Vice President had already met with petitioner's representative. For failure to pay the differential billing, petitioner disconnected the electricity of DCIM building. TEAM demanded for reconnection but petitioner refused to heed the demand. Issue: WON petitioner is liable for damages. Held:

Actual damages are compensation for an injury that will put the injured party in the position where it was before the injury. They pertain to such injuries or losses that are actually sustained and susceptible of measurement. Basic is the rule that to recover actual damages, not only must the amount of loss be capable of proof; it must also be actually proven with a teasonable degree of certainty, premised upon competent proof or the best evidence obtainable. Despite the appellate court's conclusion that no tampering was committed, it held ultra solidarily liable with petitioner only because the former, as occupant of the building, promised to settle the claims of the latter. This ruling is erroneous. Exemplary damages are imposed by way of example or correction for the public good in addition to moral, temperate, liquidated, or compensatory damages. In this case, to serve as an example - that before a disconnection of electrical supply can be effected by a public utility, the requisites of the law must be complied with -- we affirm the award of 200,000 as exemplary damages.
Manila Electric Company v MatildeMacabagdal Ramoy et al. 42

MANILA ELECTRIC COMPANY V. MATILDE MACABAGDAL RAMOY, et. al. G.R. NO. 158911 March 4, 2008 AUSTRIA-MARTINEZ, J. FACTS: National Power Corporation (NPC) filed with the MTC Quezon City a case for ejectment against several persons allegedly illegally occupying its properties in Baesa, Quezon City. Among the defendants in the ejectment case was Leoncio Ramoy, one of the plaintiffs. The MTC of Quezon City rendered judgment for the plaintiff [MERALCO] and "ordering the defendants to demolish or remove the building and structures they built on the land of the plaintiff and to vacate the premises." In the case of Leoncio Ramoy, the Court found that he was occupying a portion of a lot with the exact location of his apartments indicated in the location map. In 1990 NPC wrote Meralco requesting for the "immediate disconnection of electric power supply to all residential and commercial establishments beneath the NPC transmission lines along Baesa. Meralco decided to comply with NPC's request and issued notices of disconnection to all establishments affected including plaintiffs Leoncio Ramoy , Matilde Ramoy/Matilde Macabagdal, Rosemarie Ramoy, Durian, Valiza and Panado. Meralco requested NPC for a joint survey to determine all the establishments which are considered under NPC property in view of the fact that "the houses in the area are very close to each other" Shortly thereafter, a joint survey was conducted and the NPC personnel pointed out the electric meters to be disconnected. When the Meralco employees were disconnecting plaintiffs' power connection, plaintiff Leoncio Ramoy objected by informing the Meralco foreman that his property was outside the NPC property and pointing out the monuments showing the boundaries of his property. However, he was threatened and told not to interfere by the armed men who accompanied the Meralco employees. Afterwhich, the plaintiffs-lessees left the premises. During the ocular inspection, it was found out that the residence of plaintiffs-spouses Leoncio and Matilde Ramoy was indeed outside the NPC property. This was confirmed by defendant's

witness, Monsale and also admitted that he did not inform his supervisor about this fact nor did he recommend re-connection of plaintiffs' power supply. ISSUES: 1. WHETHER MERALCO WAS NEGLIGENT WHEN IT DISCONNECTED THE SUBJECT ELECTRIC SERVICE OF RESPONDENTS 2. WHETHER THE CA ERRED WHEN IT AWARDED MORAL AND EXEMPLARY DAMAGES AND ATTORNEY'S FEES AGAINST MERALCO RULING: 1. YES. The Court agrees with the CA that under the factual milieu of the present case, MERALCO failed to exercise the utmost degree of care and diligence required of it. To repeat, it was not enough for MERALCO to merely rely on the Decision of the MTC without ascertaining whether it had become final and executory. The utmost care and diligence required of MERALCO necessitates such great degree of prudence on its part, and failure to exercise the diligence required means that MERALCO was at fault and negligent in the performance of its obligation. In Ridjo Tape, the Court explained: [B]eing a public utility vested with vital public interest, MERALCO is impressed with certain obligations towards its customers and any omission on its part to perform such duties would be prejudicial to its interest. For in the final analysis, the bottom line is that those who do not exercise such prudence in the discharge of their duties shall be made to bear the consequences of such oversight. This being so, MERALCO is liable for damages under Article 1170 of the Civil Code. 2. YES. In order that moral damages may be awarded, there must be pleading and proof of moral suffering, mental anguish, fright and the like. While respondent alleged in his complaint that he suffered mental anguish, serious anxiety, wounded feelings and moral shock, he failed to prove them during the trial. Indeed, respondent should have taken the witness stand and should have testified on the mental anguish, serious anxiety, wounded feelings and other emotional and mental suffering he purportedly suffered to sustain his claim for moral damages. Mere allegations do not suffice; they must be substantiated by clear and convincing proof. No other person could have proven such damages except the respondent himself as they were extremely personal to him. Thus, only respondent Leoncio Ramoy, who testified as to his wounded feelings, may be awarded moral damages. With regard to exemplary damages, Article 2232 of the Civil Code provides that in contracts and quasi-contracts, the court may award exemplary damages if the defendant, in this case MERALCO, acted in a wanton, fraudulent, reckless, oppressive, or malevolent manner, while Article 2233 of the same Code provides that such damages cannot be recovered as a matter of right and the adjudication of the same is within the discretion of the court.

The Court finds that MERALCO fell short of exercising the due diligence required, but its actions cannot be considered wanton, fraudulent, reckless, oppressive or malevolent. Records show that MERALCO did take some measures, i.e., coordinating with NPC officials and conducting a joint survey of the subject area, to verify which electric meters should be disconnected although these measures are not sufficient, considering the degree of diligence required of it. Thus, in this case, exemplary damages should not be awarded. Since the Court does not deem it proper to award exemplary damages in this case, then the CA's award for attorney's fees should likewise be deleted.
B.F. Metal (Corporation) vs Court of Appeals B.F. METAL v. LOMOTAN G.R. No. 170813, April 16, 2008 Facts: In the morning of 03 May 1989, respondent Rico Umuyon was driving the owner-type jeep owned by respondents, Spouses Rolando and Linaflor Lomotan. Suddenly, at the opposite lane, the speeding ten-wheeler truck driven by Onofre Rivera overtook a car by invading the lane being traversed by the jeep and rammed into the jeep. The jeep was a total wreck while Umuyon suffered injuries, which entailed his hospitalization for 19 days. Also in view of the injuries he sustained, Umuyon could no longer drive, reducing his daily income from P150.00 to P100.00. Respondents instituted a separate and independent civil action for damages against petitioner BF Metal Corporation and Rivera before the RTC of Antipolo, Rizal. The complaint essentially alleged that defendant Riveras gross negligence and recklessness was the immediate and proximate cause of the vehicular accident and that petitioner failed to exercise the required diligence in the selection and supervision of Rivera. The complaint prayed for the award of actual, exemplary and moral damages and attorneys fees in favor of respondents Among the documentary evidence presented were the 1989 cost estimate of Pagawaan Motors, Inc., an auto-repair shop, which pegged the repair cost of the jeep at P96,000.00, and the cost estimate of Fajardo Motor Works done in 1993, which reflected an increased repair cost at P130,655.00. The trial court rendered its decision, holding the defendants negligent and ordering them to pay the plaintiffs P96,700.00 for cost of the owner-type jeep , P15,000.00 for medical expenses, P50,000.00 for loss of earnings as actual damages, plus moral and exemplary damages and attorney's fees. Petitioner and Rivera appealed the decision to the Court of Appeals, which affirmed such decision but modified the amount of damages awarded to respondents, increasing the award for actual damages to P130,655.00, for cost of repairing the owner-type jeep. Petitioner now assails the damages awarded by the appellate court. It argues that the best evidence obtainable to prove with a reasonable degree of certainty the value of the jeep is the acquisition cost or the purchase price of the jeep minus depreciation for one year of use equivalent to 10% of the purchase price. Issues: (1) whether the amount of actual damages based only on a job estimate should be lowered; 43

(2) whether Spouses Lomotan are also entitled to moral damages; and (3) whether the award of exemplary damages and attorneys is warranted Held: To justify an award of actual damages, there must be competent proof of the actual amount of loss. Credence can be given only to claims which are duly supported by receipts. In the instant case, no evidence was submitted to show the amount actually spent for the repair or replacement of the wrecked jeep. Spouses Lomotan presented two different cost estimates to prove the alleged actual damage of the wrecked jeep. However, neither estimate is competent to prove actual damages. Courts cannot simply rely on speculation, conjecture or guesswork in determining the fact and amount of damages. As correctly pointed out by petitioner, the best evidence to prove the value of the wrecked jeep is reflected in the Deed of Sale showing the jeeps acquisition cost at P72,000.00. An award of moral damages would require, firstly, evidence of besmirched reputation or physical, mental or psychological suffering sustained by the claimant; secondly, a culpable act or omission factually established; thirdly, proof that the wrongful act or omission of the defendant is the proximate cause of the damages sustained by the claimant; and fourthly, that the case is predicated on any of the instances expressed or envisioned by Article 2219 and Article 2220 of the Civil Code. In culpa aquiliana, or quasi-delict, (a) when an act or omission causes physical injuries, or (b) where the defendant is guilty of intentional tort, moral damages may aptly be recovered. This rule also applies, as aforestated, to breaches of contract where the defendant acted fraudulently or in bad faith. In culpa criminal, moral damages could be lawfully due when the accused is found guilty of physical injuries, lascivious acts, adultery or concubinage, illegal or arbitrary detention, illegal arrest, illegal search, or defamation. Undoubtedly, petitioner is liable for the moral damages suffered by respondent Umuyon. Its liability is based on a quasi-delict or on its negligence in the supervision and selection of its driver, causing the vehicular accident and physical injuries to respondent Umuyon. Rivera is also liable for moral damages to respondent Umuyon based on either culpa criminal or quasi-delict. Since the decision in the criminal case, which found Rivera guilty of criminal negligence, did not award moral damages, the same may be awarded in the instant civil action for damages. However, there is no legal basis in awarding moral damages to Spouses Lomotan whether arising from the criminal negligence committed by Rivera or based on the negligence of petitioner under Article 2180. Article 2219 speaks of recovery of moral damages in case of a criminal offense resulting in physical injuries or quasi-delicts causing physical injuries, the two instances where Rivera and petitioner are liable for moral damages to respondent Umuyon. Article 2220 does speak of awarding moral damages where there is injury to property, but the injury must be willful and the circumstances show that such damages are justly due. There being no proof that the accident was willful, Article 2220 does not apply. Exemplary damages cannot be recovered as a matter of right; the court will decide whether or not they should be adjudicated. In quasi-delicts, exemplary damages may be granted if the defendant acted with gross negligence. While the amount of the exemplary damages need not be proved, the plaintiff must show that he is entitled to moral, temperate or compensatory damages before the court may consider the question of whether or not exemplary damages should be awarded.

Spouses Lomotan have shown that they are entitled to compensatory damages while respondent Umuyon can recover both compensatory and moral damages. To serve as an example for the public good, the Court affirms the award of exemplary damages in the amount of P100,000.00 to respondents. Because exemplary damages are awarded, attorneys fees may also be awarded in consonance with Article 2208 (1). The Court affirms the appellate courts award of attorneys fees in the amount of P25,000.00. Sesbreno v CA 44

RAUL H. SESBREO vs. COURT OF APPEALS G.R. No. 161390, April 16, 2008 NACHURA, J.: Facts: Mrs. Rosario Sen and other camineros hired petitioner Atty. Raul Sesbreno to prosecute Civil Cases Nos. R-10933 and R-11214 and agreed to pay 30% percent of whatever back salaries, damages, etc. that they may recover in the mandamus and other cases that they filed against the Province of Cebu by final judgement. Further, they agreed to take care of all expenses in connection with the said cases. The camineros obtained favorable judgment when RTC of Cebu ordered that they be reinstated to their original positions with back salaries, together with all privileges and salary adjustments or increases. Aggrieved, the Commissioner of Public Highways and the District Engineer filed certiorari cases before this Court where the petitioner willingly rendered further legal assistance and represented the camineros. When respondent Eduardo R. Gullas assumed the position of governor of Cebu, he proposed the compromise settlement of all mandamus cases then pending against the province which included Civil Cases Nos. R-10933 and R-11214 handled by the petitioner. The camineros and the province of Cebu, through then Gov. Gullas forged a Compromise Agreement which includes immediate payment of full backwages and salaries as awarded by the trial court and the amounts payable to the employees concerned represented by Atty. Raul H. Sesbreo is subject to said lawyers charging and retaining liens as registered in the trial court and in the Honorable Court of Appeals. Apparently, the camineros waived their right to reinstatement embodied in the CFI decision and the province agreed that it immediately pay them their back salaries and other claims. Thus, the Supreme Court adopted said compromise agreement in its decision. The trial court then ordered the issuance of a partial writ of execution directing the payment of only 45% of the amount due them based on the computation of the provincial engineering office as audited by the authority concerned. The court did not release the remaining 55%, thus holding in abeyance the payment of the lawyers fees pending the determination of the final amount of such fees. However, instead of complying with the court order directing partial payment, the province of Cebu directly paid the camineros the full amount of their adjudicated claims.

Thus, petitioner filed the complaint for Damages (Thru Breach of Contract) and Attorneys Fees against the Province of Cebu, the provincial governor, treasurer, auditor, and engineer in their official and personal capacities, as well as against his former clients (the camineros). He alleged that by directly paying the camineros the amounts due them, the respondents induced the camineros to violate their written contract for attorneys fees. He likewise claimed that they violated the compromise agreement approved by the Court by computing t he camineros money claims based on the provincial instead of the national wage rate which, consequently, yielded a lower amount. However, he moved to dismiss the case against the camineros after their differences has been settled. The RTC rendered a decision in favor of the petitioner. The CA reversed the trial courts decision Issue: Whether or not respondents are liable for damages for breach of contract. Held: No. The compromise agreement had been validly entered into by the respondents and the camineros and the same became the basis of the judgment rendered by this Court. In fact, the judgment had already been fully satisfied by the respondents by giving the full payment. Considering that the parties agreed to a compromise, the payment would have to be based on the amount agreed upon by them in the compromise agreement approved by the court. And since the compromise agreement had assumed finality, this Court can no longer delve into its substance, especially at this time when the judgment had already been fully satisfied. The Court cannot allow the petitioner to question anew the compromise agreement on the pretext that he suffered damage. As long as he was given the agreed percentage (30%) of the amount received by the camineros, then, the agreement is deemed complied with, and petitioner cannot claim to have suffered damage. Additionally, the petitioner even withdrew his complaint against his clients on the ground that he had settled his differences with them. The records do not show that the Province of Cebu induced the camineros to violate their contract with the petitioner; nor do the records show that they paid their obligation in order to cause prejudice to the petitioner. Clearly, no fixed amount was specifically provided for in their contract nor was a specified rate agreed upon on how the money claims were to be computed.
People v Toribio Jabinniao and John Doe 45

PEOPLE VS TORIBIO JABINIAO JR. AND JOHN DOE G.R. NO. 179499 APRIL 30, 2008 CHICO-NAZARIO, J. Facts: Jabiniao was charged with Robbery with Homicide before the RTC of CDO. He and John Doe entered into the dwelling of Maria Divina Pasilang and her family at around 1AM on August 27, 1998. The accused kicked the spouses awake, pointed a gun at them, and demanded money.

The accused also shot Ruben Pasilang, Marias husband, causing his death. Upon the arrest of the accused, Maria Divina positively identified him as her husbands killer but Jabiniao averred that he was sick with a stomach ache that night. His claim was substantiated by three witnesses. Nevertheless, he was found guilty of the said crime. He appealed such decision and also contested the civil liabilities imposed upon him for the crime committed. Issue: W/N the award of civil indemnity, moral damages, actual damages, exemplary damages, and temperate damages were proper. Held: Yes. When death occurs due to a crime, the following damages may be recovered: civil indemnity ex delicto for the death of the victim, actual or compensatory damages, moral damages, exemplary damages, attorneys fees and expenses, and interest in proper cases. The award for civil indemnity is mandatory and is granted to the heirs of the victim without need of proof other than the commission of the crime. The amount of P75,000.00 as civil indemnity is awarded only if the crime is qualified by circumstances which warrant the imposition of the death penalty. Moral damages are awarded in cases of violent deaths even in the absence of proof of mental and emotional suffering of the victims heirs, because the violent and sudden death of a loved one invariably and necessarily brings about emotional pain and anguish on the part of the victims family. Exemplary damages may be imposed when the crime is committed with one or more aggravating circumstances. As held above, appellant Jabiniaos crime was aggravated by (1) the use of an unlicensed firearm; (2) commission of the crime in the dwelling of the victims; and (3) treachery. An award for loss of earning capacity is also proper in the present case.
Heirs of PurisimiaNala v Artemio Cabansag 46

Heirs of Purisimia Nala v Cabansag G.R. No. 161188. June 13, 2008 Austria-Martinez, J.: Facts: On July 23, 1990, Artemio Cabansag bought a 50 sq m property from sps Gomez, which property is a part of a 400 sq m lot registered in the name of sps Gomez. In Oct 1991, he received a letter demand from Atty Del Prado in Behalf of Purisimia Nala, asking for payment of rentals accruing from 1987 to 1991 until he leaves the premises, claiming that said property belong to her (Nala). Another demand letter was received in May 14, 1991, and because of such demands, Cabansag suffered damages and was constrained to file the case against Nala and Atty Del Prado.

Nala claims that the property is part of a 800 sq m property owned by her late husband, Eulogio Duyan, which was subsequently divided into 2 parts, which a 400 sq m was conveyed to sps Gomez in a fictitious deed of sale, with the agreement that the same will be held in trust for Duyans children. The trial court rendered a decision ordering Nala and Atty Del Prado to pay jointly and severally moral damages, exemplary damages, attorneys fees and costs of litigation. CA affirmed with modifications. Hence, this Petition. Petitioner asserts that CA erred in not taking taking cognizance of CA-G.R. CV No. 49163, which cases decision previously awarded to Nala and her children the reconveyance of the property in question. Issue: WON Nala is guilty of Abuse of Right? Held: No. Art. 19. Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith. The foregoing provision sets the standards which may be observed not only in the exercise of one's rights but also in the performance of one's duties. When a right is exercised in a manner which does not conform with the norms enshrined in Article 19 and results in damage to another, a legal wrong is thereby committed for which the wrongdoer must be held responsible. But a right, though by itself legal because recognized or granted by law as such, may nevertheless become the source of some illegality. A person should be protected only when he acts in the legitimate exercise of his right; that is, when he acts with prudence and in good faith, but not when he acts with negligence or abuse. There is an abuse of right when it is exercised only for the purpose of prejudicing or injuring another. The exercise of a right must be in accordance with the purpose for which it was established, and must not be excessive or unduly harsh; there must be no intention to injure another. In order to be liable for damages under the abuse of rights principle, the following requisites must concur: (a) the existence of a legal right or duty; (b) which is exercised in bad faith; and (c) for the sole intent of prejudicing or injuring another. In the present case, there is nothing on record which will prove that Nala and her counsel, Atty. Del Prado, acted in bad faith or malice in sending the demand letters to respondent. In the first place, there was ground for Nala's actions since she believed that the property was owned by her husband Eulogio Duyan and that respondent was illegally occupying the same. She had no knowledge that spouses Gomez violated the trust imposed on them by Eulogio and surreptitiously sold a portion of the property to respondent. It was only after respondent filed the case for damages against Nala that she learned of such sale. The bare fact that respondent claims ownership over the property does not give rise to the conclusion that the sending of the demand letters by Nala was done in bad faith. Absent any evidence presented by respondent, bad faith or malice could not be attributed to petitioner since Nala was only trying to protect their interests over the property.

Moreover, respondent failed to show that Nala and Atty. Del Prado's acts were done with the sole intention of prejudicing and injuring him. It may be true that respondent suffered mental anguish, serious anxiety and sleepless nights when he received the demand letters; however, there is a material distinction between damages and injury. Injury is the legal invasion of a legal right while damage is the hurt, loss or harm which results from the injury. Thus, there can be damage without injury in those instances in which the loss or harm was not the result of a violation of a legal duty. In such cases, the consequences must be borne by the injured person alone; the law affords no remedy for damages resulting from an act which does not amount to a legal injury or wrong. These situations are often called damnum absque injuria
City Government of Tagaytay v Hon. Eleuterio Guerrero 47

CITY GOVERNMENT OF TAGAYTAY v. HON. GUERRERO G.R. Nos. 140743 & 140745, G.R. Nos. 141451-52, September 17, 2009 NACHURA, J.: FACTS: Tagaytay-Taal Tourist Development Corporation (TTTDC) is the registered owner of two parcels of land and it incurred real estate tax liabilities on the said properties for the tax years 1976 to 1983. The City Government of Tagaytay offered the properties for sale at a public auction. Being the only bidder, a certificate of sale was executed in favor of the City of Tagaytay and was correspondingly inscribed on the titles of the lands . The City of Tagaytay filed an unnumbered petition for entry of new certificates of title in its favor before the Regional Trial Court (RTC) of Cavite. RTC granted the petition. The TTTDC appealed to the CA. The subject properties were later purchased by Amuerfina Melencio-Herrera and Emiliana MelencioFernando (Melencios) for the amount equivalent to the taxes and penalties due to the same. Meanwhile, during the pendency of the case before the CA, TTTDC filed a petition for nullification of the public auction involving the disputed properties on the ground that the properties were not within the jurisdiction of the City of Tagaytay and thus, beyond its taxing authority. On the other hand, the City of Tagaytay averred that based on its Charter, said properties are within its territorial jurisdiction. The RTC denied this motion. ISSUE: WON the City of Tagaytay is liable for damages to the Melencios HELD: YES. The City of Tagaytay acted in bad faith when it levied real estate taxes on the subject properties, and should be held accountable for all the consequences thereof, including the void sale of the properties to the Melencios. The City of Tagaytay is accountable for erroneously assessing taxes on properties outside its territorial jurisdiction. The failure of the city officials in this case to verify if the property is within its jurisdiction before levying taxes on the same constitutes gross negligence. The negligence of its officers in the performance of their official functions gives rise to an action ex contractu and quasi ex-delictu. Under the doctrine of respondeat superior, the City of Tagaytay is liable for all the necessary and natural consequences of the negligent acts of its city officials. It is liable for the tortious acts committed by its agents who sold the properties to the Melencios despite the clear mandate of RA No 1418, separating Barrio Birinayan from its jurisdiction and transferring the same to the Province of Batangas.

The City of Tagaytay is liable to return the full amount paid by the Melencios during the auction sale of the subject properties by way of actual damages. Moral damages are awarded to enable the injured party to obtain means, diversions or amusements that will serve to alleviate the moral suffering the person has undergone, by reason of defendant's culpable action. The award is aimed at restoration, as much as possible, of the spiritual status quo ante. Thus, it must be proportionate to the suffering inflicted. The Melencios are likewise entitled to exemplary damages. Exemplary or corrective damages are imposed by way of example or correction for the public good, in addition to the moral, temperate, liquidated, or compensatory damages.
Duenas v Alice Guce-Africa 48

DUENAS VERSUS ALICE GUCE-AFRICA G.R. No. 165679 October 5, 2009 DEL CASTILLO, J. Facts: The family of Africa was supposed to hold a family reunion on April 18, 1998 on their ancestral home in San Vicente, Banay-banay, Lipa City. It was the wedding date of her sister Sally Guce, and Africas other siblings from the United States of America, as well as her mother, were expected to return to the country. The wedding ceremony was set to be held at the familys ancestral house at where Africas relatives planned to stay while in the Philippines. Africa found the occasion an opportune time to renovate their ancestral house. Thus, in January 1998 she entered into a Construction Contract with Dueas for the demolition of the ancestral house and the construction of a new four-bedroom residential house. The parties agreed that Africa would pay P500,000.00 to the petitioner, who obliged himself to furnish all the necessary materials and labor for the completion of the project. Dueas likewise undertook to finish all interior portions of the house on or before March 31, 1998, or more than two weeks before Sallys wedding. On April 18, 1998, however, the house remained unfinished. The wedding ceremony was thus held at the Club Victorina and Africas relatives were forced to stay in a hotel. Her mother lived with her children, transferring from one place to another. On July 27, 1998, Africa filed a Complaint for breach of contract and damages against Dueas before the RegionalTrial Court of Pasig City. She alleged, among others, that Dueas started the project without securing the necessary permit, that Dueas unjustly and fraudulently abandoned the project leaving it substantially unfinished and incomplete and that despite several demands being made, Dueas obstinately refused to make good his contractual obligations. Both the trial court and the court of appeals ruled in favor of Africa and awarded actual damages. Hence, the recourse to the Supreme Court Issue: Whether or not Africa is entitled to actual damages. Held: The Supreme Court rules that Africa is entitled to temperate damages in lieu of actual damage.

In the case there is an absence of competent proof on the amount of actual damages suffered. Nonetheless, Africa is still entitled to temperate damages, articles 2216, 2224 and 2225 of the Civil Code applies in the present case. Temperate or moderate damages may be recovered when some pecuniary loss has been suffered but its amount cannot, from the nature of the case, be proved with certainty The amount thereof is usually left to the discretion of the courts but the same should be reasonable, bearing in mind that temperate damages should be more than nominal but less than compensatory. There is no doubt that Africa sustained damages due to the breach committed by the petitioner. The transfer of the venue of the wedding, the repair of the substandard work, and the completion of the house necessarily entailed expenses. However, as earlier discussed, Africa failed to present competent proof of the exact amount of such pecuniary loss. Hence, the petition is partially granted.
Metropolitan Bank and Trust Co. v BA Finance Corp and Malayan Insurance 49

METROPOLITAN BANK AND TRUST COMPANY (formerly ASIANBANK CORPORATION) VS BA FINANCE CORPORATION and MALAYAN INSURANCE CO., INC. G.R. No. 179952 December 4, 2009 CARPIO MORALES, J.: FACTS: Lamberto Bitanga (Bitanga) obtained from respondent BA Finance Corporation (BA Finance) a P329,280 loan to secure which, he mortgaged his car to respondent BA Finance. Bitanga thus had the mortgaged car insured by respondent Malayan Insurance Co., Inc. (Malayan Insurance) which issued a policy stipulating that, loss, if any shall be payable to BA FINANCE CORP. as its interest may appear. The car was stolen. On Bitangas claim, Malayan Insurance issued a check payable to the order of B.A. Finance Corporation and Lamberto Bitanga for P224,500, drawn against China Banking Corporation (China Bank). The check was crossed. Without the indorsement or authority of his co-payee BA Finance, Bitanga deposited the check to his account with the Asianbank Corporation (Asianbank), now merged with herein petitioner Metropolitan Bank and Trust Company (Metrobank). Bitanga subsequently withdrew the entire proceeds of the check. Bitangas loan became past due, but despite demands, he failed to settle it. ISSUE: WON petitioner liable to BA Finance for the full value of the check and WON petitioner is liable for exemplary damages. HELD: Yes. Petitioner, as the collecting bank or last indorser, generally suffers the loss because it has the duty to ascertain the genuineness of all prior indorsements considering that the act of presenting the check for payment to the drawee is an assertion that the party making the presentment has done its duty to ascertain the genuineness of prior indorsements. Accordingly, one who credits the proceeds of a check to the account of the indorsing payee is liable in conversion to the non-indorsing payee for the entire amount of the check.

Yes. Article 2231 of the Civil Code, which provides that in quasi-delict, exemplary damages may be granted if the defendant acted with gross negligence, thus applies. The business of a bank is affected with public interest; thus it makes a sworn profession of diligence and meticulousness in giving irreproachable service. For this reason, the bank should guard against in injury attributable to negligence or bad faith on its part.
Doris U. Sunbanun vs. Aurora B. Go SUNBANUN vs. GO GR NO. 163280 FACTS: Respondent Aurora B. Go leased the entire ground floor of petitioners residential house for one year which was to expire on 7 July 1996. As required under the lease contract, respondent paid a deposit of P16,000 to answer for damages and unpaid rent. To earn extra income, respondent accepted lodgers, mostly her relatives, from whom she received a monthly income of P15,000. Respondent paid the monthly rental until March 1996 when petitioner drove away respondents lodgers by telling them that they could stay on the rented premises only until 15 April 1996 since she was terminating the lease. The lodgers left the rented premises by 15 April 1996, and petitioner then padlocked the rooms vacated by respondents lodgers. Respondent filed an action for damages against petitioner. Respondent alleged that she lost her income from her lodgers for the months of April, May, and June 1996 totaling P45,000. Respondent, who worked in Hongkong, also incurred expenses for plane fares and other travel expenses in coming to the Philippines and returning to Hongkong. On the other hand, petitioner argued that respondent violated the lease contract when she subleased the rented premises. Besides, the lease contract was not renewed after its expiration on 7 July 1996; thus, respondent had no more right to stay in the rented premises. ISSUE: WON the petitioner is liable for damages to respondent. HELD: Yes. In this case, it is undisputed that petitioner ejected respondents lodgers three months before the expiration of the lease contract on 7 July 1996. Petitioner maintains that she had the right to terminate the contract prior to its expiration because respondent allegedly violated the terms of the lease contract by subleasing the rented premises. Petitioners assertion is belied by the provision in the lease contract which states that the lessee can use the premises as a dwelling or as lodging house. Furthermore the lease contract clearly provides that petitioner leased to respondent the ground floor of her residential house for a term of one year commencing from 7 July 1995. Thus, the lease contract would expire only on 7 July 1996. However, petitioner started ejecting respondents lodgers in March 1996 by informing them that the lease contract was only until 15 April 1996. Clearly, petitioners act of ejecting respondents lodgers resulted in respondent losing income from her lodgers. Hence, it was proper for the trial court and the appellate court to order petitioner to pay respondent actual damages in the amount of P45,000. Northwest Airlines v Sps Heshan 51 50

NORTHWEST AIRLINES, INC., Petitioner, - versus -

SPOUSES EDWARD J. HESHAN AND NELIA L. HESHAN AND DARA GANESSA L. HESHAN, REPRESENTED BY HER PARENTS EDWARD AND NELIA HESHAN, Respondents. G.R. No. 179117 February 3, 2010 J. Carpio-Morales Facts: In July 1998, Edward Heshan (Edward) purchased three (3) roundtrip tickets from Northwest Airlines, Inc. (petitioner) for him, his wife Nelia Heshan (Nelia) and daughter Dara Ganessa Heshan (Dara) for their trip from Manila to St. Louis, Missouri, USA and back to attend an ice skating competition where then seven yearold Dara was to participate. On the date of their scheduled flight to Manila, they arrived early at the airport and were second in line at the check-in counter. However, they were asked to step aside and wait to be called again. They were not issued boarding passes and were asked to board the plane only ten minutes prior to the departure. Only to find out that there is only one seat left, the couple gave the seat to their daughter and asked the crew if there will be other seats for them. They were instead given the folding seats at the rear of the plane and was thereafter told, that they either take them or disembark the plane. The family disembarked and took another flight. Aggrieved, the filed an action for breach of contract and damages against petitioner. the RTC ruled in favor of respondents and awarded 3million pesos for moral damages and Php 500,000.00 for exemplary damages. The CA affirmed but reduced the amount of moral damages to 2million. Issue:Whether or not error was committed in awarding excessive damages. Held:Yes. There is a need to substantially reduce the moral damages awarded by the appellate court. While courts are given discretion to determine the amount of damages to be awarded, it is limited by the principle that the amount awarded should not be palpably and scandalously excessive. Moral damages are neither intended to impose a penalty to the wrongdoer, nor to enrich the claimant. Taking into consideration the facts and circumstances attendant to the case, an award to respondents of P500,000, instead of P2,000,000, as moral damages is to the Court reasonable.
Oceaneering Contractors Phil. Inc. v Barreto, doing business as NNB Lighterage 52

Oceaneering Contractors (Phil), Inc. vs. Barreto G.R. No. 184215. February 9, 2011 PEREZ, J.:

FACTS: Nestor N. Barretto is the owner of the Barge which was licensed and permitted to engage in coastwise trading. On 27 November 1997, Barretto and Oceaneering Contractors (Phils.), Inc. entered into a Time Charter Agreement for the purpose of transporting construction materials from Manila to Ayungon, Negros Oriental. In accordance with the agreement, Oceaneering's hired stevedores loaded the barge with construction materials in the presence of and under the direct supervision of the broker Manuel Velasco and Barretto's Bargemen. On 5 December 1997, however, Barretto'sBargeman executed a Marine Protest reporting that the barge reportedly capsized in the vicinity of Cape Santiago, Batangas. Barretto commenced the instant suit with the filing of his complaint for damages against Oceaneering of the supposed fact that the mishap was caused by the incompetence and negligence of the latter's personnel in loading the cargo. Oceaneering, on the other hand, averred that the accident was caused by the negligence of Barretto's employees and the dilapidated hull of the barge which rendered it unseaworthy. As a consequence, Oceaneering prayed for the grant of its counterclaims for the value of its cargo in the sum of P4,055,700.00, salvaging expenses in the sum of P125,000.00, exemplary damages, attorney's fees and litigation expenses. The RTC rendered a decision, dismissing both Barretto's complaint and Oceaneering's counterclaims for lack of merit as well as the value of its lost cargo. On appeal, the CA affirmed the denial on the ground of failure to prove the value of actual damages. Hence, this petition. ISSUE: WON Oceaneering is entitled for the award of actual damages. HELD: YES. The rule is long and well settled that there must be pleading and proof of actual damages suffered for the same to be recovered. In addition to the fact that the amount of loss must be capable of proof, it must also be actually proven with a reasonable degree of certainty, premised upon competent proof or the best evidence obtainable. The burden of proof of the damage suffered is, consequently, imposed on the party claiming the same who should adduce the best evidence available in support thereof. In this case, Oceaneering correctly fault the CA for not granting its claim for actual damages or, more specifically, the portions thereof which were duly pleaded and adequately proved before the RTC. While concededly not included in the demand letters dated 12 March 199849 and 13 July 1998 Oceaneering served Barretto, the former's counterclaims for the value of its lost cargo in the sum of P4,055,700.00 and salvaging expenses in the sum of P125,000.00 were distinctly pleaded and prayed for in the 26 January 1999 answer it filed a quo.
Heirs of Jose Marcial Ochoa v Heirs of Jose Marcial Ochoa 53

Heirs of Jose Marcial Ochoa v. G&S Transport Corp., and G&S Transport Corp. v Heirs of Jose Marcial Ochoa GR 170071 and 170125; March 9, 2011 Del Castillo, J FACTS: A complaint for damages was filed by the Heirs of Ochoa against G&S with the RTC Pasig on account of Jose Marcial Ochoas death while onboard an Avis taxicab which fell from a flyover and landed on EDSA. The taxi was owned and operated by G&S. The RTC adjudged G&S guilty of breach of contract of carriage and ordered it to pay the heirs indemnity and moral and

exemplary damages. The CA affirmed that the driver, Padilla failed to employ reasonable foresight, diligence and care needed to exempt G&S from liability. It also ordered that the award for loss of income be deleted and moral damages be reduced on account of the income certificate issued by Marcials employer, USAID, was unreliable and not supported by competent evidence. ISSUES: 1) Whether or not G&S is liable. 2) Whether or not the acquittal of Padilla in the criminal case is immaterial to the instant case for breach of contract. 3) Whether the heirs should be indemnified for loss of income based on the unsupported USAID certification. HELD: 1) Yes. In a contract of carriage, it is presumed that the common carrier is at fault or is negligent when a passenger dies or is injured. In fact, there is even no need for the court to make an express finding of fault or negligence on the part of the common carrier. This statutory presumption may only be overcome by evidence that the carrier exercised extraordinary diligence.[38] Unfortunately, G & S miserably failed to overcome this presumption. Both the trial court and the CA found that the accident which led to Jose Marcials death was due to the reckless driving and gross negligence of G & S driver, Padilla, thereby holding G & S liable to the heirs of Jose Marcial for breach of contract of carriage. 2) Yes. The action filed by the Heirs is primarily for the recovery of damages arising from breach of contract of carriage allegedly committed by G&S. Clearly, it is an independent civil action arising from contract which is separate and distinct from the criminal action for reckless imprudence resulting in homicide filed by the heirs against Padilla by reason of the same incident. Hence, regardless of Padillas acquittal or conviction in said criminal case, same has no bearing in the resolution of the present case. 3) No. A research on USAID reveals that It is an independent federal government agency that receives over-all foreign policy guidance from the Secretary of the State [of the United States].[49] Given this background, it is highly improbable that such an agency will issue a certification containing unreliable information regarding an employees income. Besides, there exists a presumption that official duty has been regularly performed.[50] Absent any showing to the contrary, the correctness of the certification is correct, especially so where the authenticity, due execution and correctness of said certification have not been put in issue either before the trial court or the CA. Verily, the USAID certification cannot be said to be self-serving because it does not refer to an act or declaration made out of court by the heirs themselves as parties to this case. Clearly, the CA erred in deleting the award for lost income on the ground that the USAID Certification supporting such claim is self-serving and unreliable. Said certification is sufficient basis for the court to make a fair and reasonable estimate of Jose Marcials loss of earning capacity.
Ricardo Bangyan v RCBC 54

RICARDO B. BANGAYAN v. RIZAL COMMERCIAL BANKING CORPORATION AND PHILIP SARIA, G.R. No. 149193 April 4, 2011 SERENO, J.: FACTS: Ricardo Bangayan had a savings account and a current account with one of the branches of respondent Rizal Commercial Banking Corporation (RCBC). Which had an automatic transfer condition wherein checks issued by the depositor may be funded by any of the two accounts. On 26 June 1992, RCBC in favor of nine corporations, Bangayan purportedly signed a Comprehensive Surety Agreement (the Surety Agreement). The funds in Bangayans accounts with RCBC would be used as security to guarantee any existing and future loan obligations, advances, credits/increases and other obligations, including any and all expenses that these corporations may incur with respondent bank. The following are the transactions of RCBC in relation to the Surety Agreement vis--vis Bangayan. On 26 June 1992 two of the corporations whose performance were guaranteed therein LBZ Commercial and Peaks Marketing were issued separate commercial letters of credit by RCBC for the importation of PVC resin from Korea. Three days later RCBC issued a third letter of credit in favor of another corporation, Final Sales Enterprise, whose obligations to respondent bank were likewise secured by Bangayan under the Surety Agreement. Mr. Lao claimed that respondent bank would not have extended the letters of credit in favor of the three corporations without Bangayan acting as surety. On 26 August 1992, a fourth letter of creditwas issued by RCBC for the importation of materials from Korea, this time by Lotec Marketing. The Korea Exchange Bank was designated as the advising bank for Lotec Marketings letter of credit. On 15 September 1992, after the arrival of the shipments of the first three corporations from Korea, the Bureau of Customs (BOC) demanded via letter of the same date from respondent RCBC, which facilitated the three letters of credit, the remittance of import duties in the amount of PhP13,265,225. Mr. Lao then allegedly called Bangayan and informed him of the BOCs demand for payment of import duties. According to Mr. Lao, Bangayan allegedly replied that he understood the situation and assured Mr. Lao that he was doing everything he could to solve the problem. Considering the BOCs demand, RCBC decided to put on hold the funds in petitioner Bangayans accounts by virtue of the authority given to it by petitioner under the Surety Agreement. Thus, the bank refused payments drawn from Bangayans deposits, unless there was an order from the BOC. Bangayan, however, contests this action since respondent bank did not present any writ of garnishment that would authorize the freezing of his funds. On 18 September 1992, two of the seven checks that were drawn against Bangayans Current Account No. 0109-8232-5 were presented for payment to respondent RCBC. On the same day, the amounts PhP3,650,000 and PhP4,500,000 were successively debited from the said current account. On 21 September 1992, the same amounts in the two checks were credited to Bangayans current account, under the transaction reference code CM, that stands for credit memo. Moreover, Bangayans Checks Nos. 93799 and 93800 issued in favor of United Pacific

Enterprises were also returned by respondent RCBC with the notation REFER TO DRAWER. On the same day that the checks were referred to Bangayan by respondent RCBC, United Pacific Enterprises, through Mr. Dente, demanded from Bangayan the payment of PhP8,150,000, which corresponded to the amounts of the two dishonored checks that were issued to it. On 24 September 1992, the Korea Exchange Bank informed RCBC through a telex that it had already negotiated the fourth letter of credit for Lotec Marketings shipment, which amounted to US$712,800 and, thereafter claimed reimbursement from RCBC. This particular shipment by Lotec Marketing became the subject matter of an investigation conducted by BOC, according to RCBC. Both parties agreed that the BOC likewise conducted an investigation covering the importation of the three corporations LBZ Commercial, Peaks Marketing and Final Sales Enterprise - that were opened through the letters of credit issued by RCBC. On 09 October 1992, Saria, who was an Account Officer of RCBC Binondo signed and executed a Statement before the BOC, with the assistance of Atty. Arnel Z. Dolendo of RCBC, on the banks letters of credit issued in favor of the three corporations. Bangayan cited this incident as the basis for the allegation in the Complaint he subsequently filed that RCBC had disclosed to a third party (the BOC) information concerning the identity, nature, transaction and deposits including details of transaction related to and pertaining to his deposits with the said bank, in violation of the Bank Secrecy Act. On the same date, when Lotec Marketings loan obligation under the fourth letter of credit became due and demandable RCBC issued an advice that it would debit the amount of PhP12,762,600 from Bangayans account to partially satisfy the guaranteed corporations loan. On 12 October 1992, the amount of PhP12,762,600 was debited from Bangayans account. RCBC claimed that amount was debited to partially pay Lotec Marketings outstanding obligation (PhP18,047,033.60). Lotec Marketing, thereafter, paid the balance of its obligation to respondent RCBC. On 13 October 2010, the three corporations earlier adverted to paid the corresponding customs duties demanded by the BOC. Receipts were subsequently issued, the by BOC for the corporations payments, copies of which were received by Atty. Nelson The trial court considered this as payment by petitioner of the three corporations obligations for cust om duties. RCBC then released to the corporations the necessary papers for their PVC. Thereafter, respondent resin shipments which were imported through the banks letters of credit. On 15 October 2010, five other checks of petitioner Bangayan were presented for payment to RCBC. On 16 October 1992, these five checks were also dishonored by RCBC on the ground that they had been drawn against insufficient funds. On 20 October 1992, Hinomoto Trading Company, Bangayan make good on his payments. On 21 October 1992, the other payee of the three other dishonored checks, likewise made a final demand on petitioner to replace the dishonored instruments. On 23 October 1992, Bangayan, through counsel, demanded that RCBC restore all the funds to his account and indemnify him for damages. On 30 October 1992, PhP19,427.15 was credited in Bangayans account. On 09 November 1992, Bangayan filed a complaint for damages against respondent RCBC. He argues that at the time the dishonored checks were issued, there were sufficient funds in his accounts to cover them that he was informed by personnel of respondent

RCBC that his accounts were garnished, but no notice or writ of garnishment was ever shown to him and that his name and reputation were tarnished because of the dishonor of checks that were issued in relation to his automotive business. Furthermore, Bangayan also alleged that RCBC disclosed to a third party (the BOC) classified information about the identity and nature of the transactions and deposits, in violation of the Bank Secrecy Act. In its defense RCBC claims that Bangayan signed a Surety Agreement in favor of several companies that defaulted in their payment of customs duties that resulted in the imposition of a lien over the accounts, particularly for the payment of customs duties assessed by the Bureau of Customs. The bank further claimed that it had funded the letter of credit. Further as to the violation of the bank secrecy RCBC counters that no confidential information on petitioners bank accounts was disclosed. The RTC dismissed the complaint of Bangayan, which was affirmed by the CA. ISSUE: Whether or not there was malice or bad faith on the part of RCBC in the dishonor of the checks? HELD: No. First, Bangayan failed to establish how his signature in the Surety Agreement was forged. Before a private document is offered as authentic, its due execution and authenticity must be proved: (a) either by anyone who has seen the document executed or written; or (b) by evidence of the genuineness of the signature or handwriting of the maker. As a rule, forgery cannot be presumed and must be proved by clear, positive and convincing evidence. Mr. Lao, witness for RCBC, identified the Surety Agreement as well as the genuineness of Bangayans signature. Second, the mere absence of notarization does not necessarily render the Surety Agreement invalid. Third, the annex of the Surety Agreement does not bear Bangayans signature is not a sufficient ground to invalidate the main agreement altogether. As the records will bear out, the Surety Agreement enumerated the names of the corporation whose obligations Bangayan are securing. It enumerated not only the names of the corporations but their respective addresses as well. Fourth, Bangayan never contested the existence of the Surety Agreement prior to the filing of the Complaint. When Mr. Lao informed him of the letter from the BOC regarding the failure of the three corporations to pay the customs duties under the letters of credit, the Bangayan assured RCBC that he is doing everything he can to solve the problem. If he purportedly never signed the Surety Agreement, he would have been surprised or at least perplexed that RCBC would contact him regarding the three corporations letters of credit. In this case, RCBC, as the issuing bank had to make prompt payment when the obligation became due and demandable. Precisely because of the independence principle in letters of credit and the need for prompt payment, RCBC required a Surety Agreement from Bangayan before issuing the letters of credit in favor of the four corporations. In all seven dishonored checks,

RCBC properly exercised its right as a creditor under the Surety Agreement to apply Bangayans funds in his accounts as security for the obligations of the four corporations under the letters of credit. Thus, Bangayan cannot attribute any wrong or misconduct to respondent RCBC since there was no malice or bad faith on the part of respondent in dishonoring the checks.
People v Villarico 55

People vs. Villarico FACTS: An information for murder was all the accused. After trial, the RTC convicted the four accused of homicide aggravated by dwelling. The RTC accorded faith to the positive identification of the accused by the Prosecutions witnesses, and di sbelieved their denial and alibis due to their failure to show the physical improbability for them to be at the crime scene, for the distances between the crime scene and the places where the accused allegedly were at the time of the commission of the crime were shown to range from only 100 to 700 meters.[17] The RTC found, however, that the Prosecution was not able to prove treachery, an aggravating circumstance according to the RPC. On appeal, the CA modified the RTCs decision, holding instead that murd er was established beyond reasonable doubt because the killing was attended by treachery. ISSUE: Whether or not damages shall be awarded in favour of the heirs of the victim. RULING: The Supreme Court affirmed the finding of guilt for the crime of murder, but modify the civil liability. There is no question that the CA justly pronounced all the four accused guilty beyond reasonable doubt of murder. However, the CA did not explain why it did not review and revise the grant by the RTC of civil liability in the amount of only P50,000.00. Thereby, the CA committed a plainly reversible error for ignoring existing laws, like Article 2206 of the Civil Code,[53] which prescribes a death indemnity separately from moral damages, and Article 2230 of the Civil Code,[54] which requires exemplary damages in case of death due to crime when there is at least one aggravating circumstance; and applicable jurisprudence, specifically, People v. Gutierrez,[55] where we held that moral damages should be awarded to the heirs without need of proof or pleading in view of the violent death of the victim, and People v.Catubig,[56] where we ruled that exemplary damages were warranted whenever the crime was attended by an aggravating circumstance, whether qualifying or ordinary. Here, the aggravating circumstance of treachery, albeit attendant or qualifying in its effect, justified the grant of exemplary damages. A rectification should now be made, for, indeed, gross omissions, intended or not, should be eschewed. It is timely, therefore, to remind and to exhort all the trial and appellate courts to be always mindful of and to apply the pertinent laws and jurisprudence on the kinds and amounts of indemnities and damages appropriate in criminal cases lest oversight and omission will unduly add to the sufferings of the victims or their heirs.

The court grant to the heirs of Haide P75,000.00 as death indemnity;[59] P75,000.00 as moral damages;[60] and P30,000.00 as exemplary damages.[61] As clarified in People v. Arbalate,[62] damages in such amounts are to be granted whenever the accused are adjudged guilty of a crime covered by Republic Act No. 7659, like the murder charged and proved herein.
Philippine Savings Bank v Sps Castillo 56

Philippine Savings Bank vs Spouses Castillo GR No 193178 May 30, 2011 Facts: The Spouses Alfredo and Elizabeth Catillo were the owners of land in Tondo, Manila. Romeo Capati and Aquilina Lobo were also owners of another lot in the same area. Capati and Aquilina obtained a loan with real estate mortgage over such properties from the Philippine Savings Bank as shown by a promissory note given. From the time that the loan was released, such interest rate was increased or decreased by the bank, the highest being 29 percent and the lowest being 15.5 percent per year of the PN. Capati and Aquilina were given notice of such change in interest but they never confirmed nor questioned it. Alfredo however sent a letter to the bank to reduce the interest but the bank did not agree The respondents paid their amortizations but there came a time they started failing to pay Despite demand letters from the bank, the respondents still failed to pay, hence the extra judicial foreclosure of the properties. The properties where then sold and awarded to the bank as the only bidder. Because the bank was the mortgagee, they no longer paid the amount and instead credited such amount to the loan. A certificate of sale was then executed and the respondents did not redeem the land within one year. So Alfredo wrote the bank stating they would like an extension of 60 days to buy the property offering 3 million. Although the bank acceded, respondents did not redeem properties. The respondents then filed a case against the bank for reformation of the instrument and to declare the foreclosure as void. It is noteworthy to include that the ruling of the CA is that the banks interest rates are unreasonable and is liable for damages (moral, exemplary and attorneys fees) Issue: Whether or not there should be an award for damages or attys fees against the bank. Held: Moral damages are not recoverable simply because a contract has been breached. They are recoverable only if the party from whom it is claimed acted fraudulently or in bad faith or in wanton disregard of his contractual obligations. The breach must be wanton, reckless, malicious or in bad faith, and oppressive or abusive. Likewise, a breach of contract may give rise to exemplary damages only if the guilty party acted in a fraudulent or malevolent manner. In this case, we are not sufficiently convinced that fraud, bad faith, or wanton disregard of contractual obligations can be imputed to petitioner simply because it unilaterally imposed the changes in interest rates, which can be attributed merely to bad business judgment or attendant negligence. Bad faith pertains to a dishonest purpose, to some moral obliquity, or to the conscious doing of a wrong, a breach of a known duty attributable to a motive, interest or ill will that partakes of the nature of fraud. Respondents failed to sufficiently establish this

requirement. Thus, the award of moral and exemplary damages is unwarranted. In the same vein, respondents cannot recover attorneys fees and litigation expenses. Accordingly, these awards should be deleted. However, as regards the above mentioned award for refund to respondents of their interest payments in excess of 17% per annum, the same should include legal interest. In Eastern Shipping Lines, Inc. v. Court of Appeals, we have held that when an obligation is breached, and it consists in the payment of a sum of money, the interest on the amount of damages shall be at the rate of 12% per annum, reckoned from the time of the filing of the complaint.
People v RodendoRebucan y Lamsin 57

PEOPLE OF THE PHILIPPINES vs.ROSENDO REBUCAN y LAMSIN G.R. No. 182551 July 27, 2011 LEONARDODE CASTRO, J.: FACTS: That on or about the 6th day of November, 2002, in the Municipality of Carigara, Province of Leyte, Rosendo Rebucan y Lamsin, with deliberate intent to kill, with treachery and evident premeditation and abuse of superior strength, did then and there willfully, unlawfully and feloniously attack, assault and wound FELIPE LAGERA Y OBERO, 65 years old and RANIL TAGPIS Y LAGERA, 1 year old, with the use of a long bolo (sundang) which the accused had provided himself for the purpose. The RTC found accused ROSENDO REBUCAN y LAMSIN, GUILTY beyond reasonable doubt of the crime of DOUBLE MURDER charged under the information and sentenced to suffer the maximum penalty of DEATH, and to pay civil indemnity to the heirs of Felipe Lagera and Ramil Tagpis, Jr. in the amount of Seventy-Five Thousand (P75,000.00) Pesos for each victim and moral damages in the amount of SeventyFive Thousand (P75,000.00) Pesos to each; and Pay the cost. The CA modified the judgment of the RTC. The appellate court adopted the position of the Office of the Solicitor General (OSG) that the felonious acts of the accused-appellant resulted in two separate crimes of murder as the evidence of the prosecution failed to prove the existence of a complex crime of double murder. The award of civil indemnity is reduced to P50,000.00 for each victim; the award of moral damages is likewise reduced toP50,000.00 for each victim. Further, exemplary damages in the amount of P25,000.00 is awarded to the heirs of each victim ISSUE: Whether or not CA was correct in awarding exemplary damages in the in the instant case. RULING: Yes. Anent the award of damages, when death occurs due to a crime, the following may be recovered: (1) civil indemnity ex delicto for the death of the victim; (2) actual or compensatory damages; (3) moral damages; (4) exemplary damages; (5) attorney's fees and expenses of litigation; and (6) interest, in proper cases. Civil indemnity is mandatory and granted to the heirs of the victim without need of proof other than the commission of the crime. Similarly, moral damages may be awarded by the court for the mental anguish suffered by the heirs of the victim by reason of the latters death. The award

of exemplary damages, on the other hand, is provided under Articles 2229-2230 of the Civil Code, viz: Art. 2229. Exemplary or corrective damages are imposed, by way of example or correction for the public good, in addition to the moral, temperate, liquidated or compensatory damages. Art. 2230. In criminal offenses, exemplary damages as a part of the civil liability may be imposed when the crime was committed with one or more aggravating circumstances. Such damages are separate and distinct from fines and shall be paid to the offended party. In People v. Dalisay, the Court clarified that "[b]eing corrective in nature, exemplary damages, therefore, can be awarded, not only in the presence of an aggravating circumstance, but also where the circumstances of the case show the highly reprehensible or outrageous conduct of the offender. In much the same way as Article 2230 prescribes an instance when exemplary damages may be awarded, Article 2229, the main provision, lays down the very basis of the award."
People v Edgar Evangelio y Gallo, et al 58

PEOPLE VS. EDGAR EVANGELIO y GALLO, ET AL G.R. No. 181902, August 31, 2011 PERALTA, J.: Facts: This is an appeal from the Decision of the Court of Appeals (CA) affirming the trial court's judgment finding Joseph Evangelio guilty beyond reasonable doubt of the crime of Robbery. Appellant Joseph Evangelio (Joseph), accused Edgar Evangelio (Edgar), Atilano Agaton (Atilano) and Noel Malpas y Garcia (Noel) with intent to gain and armed with a handgun and deadly/bladed weapons forcibly enter the inhabited house/residence of BBB in Tacloban City and while inside, by means of violence and intimidation using said arms on the latter and the other occupants therein, and took personal properties from said residence. They herded all the other members of the household whom they caught and bound their hands and feet, and thereafter, placed masking tapes over their captives eyes. They also had carnal knowledge of AAA, a 17-year-old minor, against her will and consent while she was unconscious on the bathroom floor. AAA was examined by Dr. Angel Cordero, a medico-legal officer of the Philippine National Police (PNP) Crime Laboratory the following day and found that she sustained deep healing lacerations and shallow healed lacerations. He concluded that AAA was in a non-virgin state physically and that findings are compatible with recent loss of virginity and with recent sexual intercourse". Atilano and Edgar were not arraigned because of a pending case in Bacolod City, while Noel remained at large. The appellant was positively identified by the prosecution witnesses as one of the perpetrators of the crime of robbery with rape. In his defense, appellant denied having committed the crimes charged and interposed alibi as a defense. He was sleeping in his house at Diit, Tacloban City with his mother and sisters.

The trial court did not order the appellant to return the items taken from the victims but, instead, directed the payment of actual damages amounting to PhP336,000.00. The said amount is the value of the items taken from the spouses BBB and CCC. It also ordered the award of moral damages in the amount of PhP50,000.00 to the spouses BBB and CCC as well as actual damages amounting to PhP3,000.00 and moral damages amounting to PhP20,000.00 in favor of Edelyn. Issue: Are BBB, CCC and Edelyn entitled for the award of actual and moral damages? Held: No. In this case, the prosecution established that appellant and his three co-accused took the pieces of jewelry and valuables of the spouses BBB and CCC by means of violence and intimidation. Although the victim AAA did not exactly witness the actual rape because she was unconscious at that time, circumstantial evidence shows that the victim was raped by the appellant and the other accused. As for the award of damages, under Article 105 of the RPC, the appellant is obliged to return the items he took from the spouses BBB and CCC. If appellant can no longer return the articles taken, he is obliged to make reparation for their value, taking into consideration their price and their special sentimental value to the offended parties. Should restitution be no longer possible, appellant shall pay the spouses BBB and CCC the value of the stolen pieces of jewelry and valuables. The trial court's award of moral damages in the amount of PhP50,000.00 to the spouses BBB and CCC is not proper. In order that a claim for moral damages can be justified, it must be anchored on proof showing that the claimant experienced moral suffering, mental anguish, serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation or similar injury. The victim spouses BBB and CCC, did not present any evidence of their moral sufferings as a result of the robbery. Thus, there is no basis for the grant of moral damages in connection with the robbery. The CA was also correct in deleting the award of actual damages amounting to PhP3,000.00 and moral damages amounting to PhP20,000.00 in favor of Edelyn. The information for robbery with rape filed against the accused shows that Edelyn is not one of the complainants therein and there is no description of the pieces of jewelry and valuables allegedly taken from her. The appellant was not informed that he was being charged of robbery in so far as Edelyn is concerned. In line with prevailing jurisprudence, AAA is entitled to civil indemnification. Upon the finding of rape, the victim is entitled to civil indemnity. In addition, AAA is entitled to moral damages pursuant to Article 2219 of the Civil Code, without the necessity of additional pleadings or proof other than the fact of rape. Moral damages is granted in recognition of the victim's injury necessarily resulting from the odious crime of rape. Such award is separate and distinct from the civil indemnity.

Development Bank of the Philippines v Traverse Development Corporation

59

Development Bank of the Philippines vs. Traverse Development Corporation G.R. No. 169293, October 5, 2011 Ponente: LEONARDO-DE CASTRO, J.: FACTS: The Development of the Philippines (DBP)-Tarlac Branch granted a Real Estate Loan of 910,000.00 to Traverse Development Corporation (Traverse) for the construction of its three-storey commercial building at Taedo St., Tarlac City. To secure the payment of this loan, Traverse constituted a mortgage on the land on which the building was to be built on July 21, 1980.Among the conditions imposed by DBP in the mortgage contract was Traverses acquisition of an insurance coverage for an amount not less than the loan, to be endorsed in DBPs favor. From 1980 to 1981, Traverse submitted to DBP three policies in accordance with the insurance condition in the mortgage contract. Originally, the fire insurance was under the FGU Insurance for one (1) million, but the DBP transferred the building insurance to Central Surety & Insurance Company (Central) for the same terms. On August 9, 1982, a fire of undetermined origin razed and gutted Traverses building. The following day, Traverse informed Central of the mishap and requested it to immediately conduct the necessary inspection, evaluation, and investigation however Central denied the proposal of one (1) million claim of Traverse. Hence, Traverse instituted a case in the court. Traverse averred that it was obvious from the beginning that Central was unable or unwilling to fulfill its liability. Traverse impleaded DBP as a co-defendant because of its alleged failure or refusal to convince Central to pay Traverses claims, considering that it transferred Traverses insurance to Central without Traverses knowledge. The RTC adjudged DBP to be solidarily liable with Central for damages, attorneys fees, and costs of suit in view of its refusal or failure to pursue the claim against Central. The RTC said that as beneficiary-assignee of the Policy, DBP should not have stopped at following-up its claim through letters and telegrams but should have either filed its own case against Central or joined Traverse as a co-plaintiff. ISSUE: Whether or not DBP can be held solidarily liable with Central for the payment of attorneys fees and cost of litigation hence answerale to damages, attorneys fees and cost of suit? HELD: NO. Even if it were true that DBP had a hand in the transfer of Traverses insurance coverage to Central, such act is not sufficient to hold it solidarily liable with Central for the payment of attorneys fees and cost of litigation under paragraph (2) of Article 2208. This Court also cannot sustain the insinuation that DBPs lax attitude in pursuing its claim against Central was tantamount to bad faith as to make it liable for attorneys fees and costs of suit. Even a resort to the principle of equity will not justify making DBP liable. The award of attorneys fees is the exception rather than the rule and the court must state explicitly the legal reason for such award. The general rule is that attorneys fees cannot be recovered as part of damages because of the policy that no premium should be placed on the right to litigate. They are not to be awarded every time a party wins a suit. The power of the court to award attorneys fees under Article 2208 demands factual, legal, and equitable justification. Even when a claimant is compelled to litigate with third persons or to incur expenses to protect his rights, still attorneys fees may not

be awarded where no sufficient showing of bad faith could be reflected in a partys pers istence in a case other than an erroneous conviction of the righteousness of his cause.