CZARINA T. MALVAR VS. KRAFT FOODS PHILS., INC.

AND/OR
BIENVENIDO BAUTISTA, KRAFT FOODS INTERNATIONAL
G.R. No. 183952. September 9, 2013

FACTS:

In 1988, Kraft Foods Phils., (KRAFT) hired Czarina Malvar as its

Corporate Planning Manager. She rose in the ranks and became the
Vice President for Finance in the Southeast Asia region of Kraft Foods
International, KFPIs mother company. In 1999, the chairman of the
board of KFPI and concurrently the VP and Area Director for SEA,
sent Malvar a memo directing her to explain why no administrative
sanctions should be imposed on her for possible breach of trust and
confidence and for willful violation of company rules and regulations.
She was places under preventive suspension and ultimately she was
served a notice of termination. Malvar, aggrieved, filed a
complaint for illegal suspension and illegal dismissal against KFPI and
Bautista in the NLRC. The Labor Arbiter found and declared her
suspension and dismissal illegal and ordered her reinstatement. The
judegment became final and executory however Malvars award was
reduced. Both parties appealed the computation of the NLRC. While
pending appeal, Malvar and the respondents entered into a
compromise agreement wherein Malvar would be paid 40 million
pesos. Malvar moved to withdraw the case in view of the compromise
agreement . But before the court could act on the motion to
dismiss/withdraw, a motion for intervention to protect the Attorney's
rights was filed. It appears that, to the intervenors surprise, Malvar
unceremoniously and without any justifiable reason terminated its
legal service and required it to withdraw from the case. The
intervenor indicated that Malvars precipitate action had baffled,
shocked and even embarrassed the intervenor, because it had done
everything legally possible to serve and protect her interest. It added
that it could not recall any instance of conflict or misunderstanding
with her, for on the contrary, she had even commended it for its
dedication and devotion to her case.

ISSUE:

Whether or not KRAFT is jointly and severally liable to pay the

intervenor Law firm?

HELD:

The respondents would be liable if they were shown to have

connived with Malvar in the execution of the compromise agreement,
with the intention of depriving the intervenor of its attorneys fees.
Therefore they would be solidarily liable with her for the attorneys
fees as stipulated in the written agreement under the theory that they
unfairly and unjustly interfered with the intervenors professional
relationship with Malvar.

The respondents were complicit in Malvar's move to deprive

the Intervenor of its duly earned contingent fees. At this juncture, the
Court notes that the compromise agreement would have Malvar waive
even the substantial stock options already awarded by the NLRC's
decision, which ordered the respondents to pay to her, among others,
the value of the stock options and all other bonuses she was entitled
to or would have been entitled to had she not been illegally dismissed
from her employment. This ruling was affirmed by the CA. But the
waiver could not negate the Intervenor's right to 10% of the value of
the stock options she was legally entitled to under the decisions of the
NLRC and the CA, for that right was expressly stated in the written
agreement between her and the Intervenor. Thus, the Intervenor
should be declared entitled to recover full compensation in
accordance with the written agreement because it did not assent to
the waiver of the stock options, and did not waive its right to that part
of its compensation.

The circumstances show that Malvar and the respondents

needed an escape from greater liability towards the intervenor, and
from the possible obstacle to their plan to settle to pay. Thereby, she
and the respondents became joint tort-feasors who acted adversely
against the interests of the Intervenor. Under Article 2194 of the Civil
Code, joint tort-feasors are solidarily liable for the resulting damage.
 NATIONAL POWER CORPORATION V. COURT OF APPEALS

G.R. No. 119121. August 14, 1998.

FACTS:

A convoy of four (4) dump trucks owned by the National Power

Corporation (NPC) left Marawi city bound for Iligan city.
Unfortunately, enroute to its destination, one of the trucks with plate
no. RFT-9-6-673 driven by a certain Gavino Ilumba figured in a head-
on-collision with a Toyota Tamaraw. The incident resulted in the death
of 3 persons riding in the Toyota Tamaraw, as well as physical injuries
to 17 other passengers. The heirs of the victims then filed a complaint
for damages against National Power Corporation (NPC) and PHESCO
Incorporated (PHESCO) before the then Court of First Instance of
Lanao del Norte, Marawi City. When defendant PHESCO filed its
answer to the complaint it contended that it was not the owner of the
dump truck which collided with the Toyota Tamaraw but NPC.
Moreover, it asserted that it was merely a contractor of NPC with the
main duty of supplying workers and technicians for the latters
projects. On the other hand, NPC denied any liability and countered
that the driver of the dump truck was the employee of PHESCO. Trial
court absolved NPC and ordered PHESCO, Inc. and Gavino Ilumba to
pay jointly and severally the plaintiffs thru the Dansalan College the
sum of P954,154.55 representing the actual or compensatory
damages incurred by the plaintiffs; and P50,000.00 representing
Attorneys fees. Dissatisfied, PHESCO appealed. CA reversed the trial
courts judgment. Chagrined by the sudden turnaround, NPC filed a
motion for reconsideration of said decision which was, however,
denied on February 9, 1995. Hence, this petition.

ISSUE:

Whether or not NPC is liable for the tort of driver Gavino

Ilumba?

HELD:

YES. In the case at bar, there is no doubt that PHESCO was

engaged in labor-only contracting vis-a-vis NPC and as such, it is
considered merely an agent of the latter. So, even if PHESCO hired
driver Gavino Ilumba, as PHESCO is admittedly a labor only
contractor of NPC, the statute itself establishes an employer-employee
relationship between the employer NPC and the employee (driver
Ilumba) of the labor only contractor (PHESCO).

Consequently, we hold PHESCO not liable for the tort of driver

Ilumba, as there was no employment relationship between PHESCO
and driver Ilumba. Under Article 2180 of the Civil Code, to hold the
employer liable for torts committed by his employees within the scope
of their assigned task, there must exist an employer-employee
relationship.
 Also, the position of NPC that even assuming that a labor only
contract exists between it and PHESCO, its liability will not extend to
third persons who are injured due to the tortious acts of the employee
of the labor-only contractor, stated otherwise, its liability shall only be
limited to violations of the Labor Code and not quasi-delicts is
misplaced. It bears stressing that the action was premised on the
recovery of damages as a result of quasi-delict against both NPC and
PHESCO, hence, it is the Civil Code and not the Labor Code which is
the applicable law in resolving this case.

An implementing rule on labor cannot be used by an employer as a

shield to avoid liability under the substantive provisions of the Civil
Code.

In this regard, NPC's liability is direct, primary and solidary with

PHESCO and the driver. Of course, NPC, if the judgment for damages
is satisfied by it, shall have recourse against PHESCO and the driver
who committed the negligence which gave rise to the action.
 LIGHT RAIL TRANSIT AUTHORITY & RODOLFO ROMAN vs.
MARJORIE NAVIDAD, HEIRS OF THE LATE NICANOR NAVIDAD
& PRUDENT SECURITY AGENCY. G.R. No. 145804. February 6,
2003.

FACTS:

Navidad was drunk when he entered the boarding platform of

the LRT. He got into an altercation with the Security Guard Junelito
Escartin. They had a fistfight and Navidad fell onto the tracks and was
killed instantaneously upon being hit by a moving train operated by
Rodolfo Roman. The Heirs of Navidad filed a complaint for damages
against Escartin, the train driver (Roman), the LRTA, the Metro
Transit Organization and Prudent Security Agency (agency of security
guards) for the death of her husband. The trial court found Prudent
and Escartin jointly and severally liable for damages to the heirs. The
Court of Appeals however reversed the decision of the RTC by
exonerating Prudent and instead held the LRTA and the train driver
Romero jointly and severally liable as well as removing the award for
compensatory damages and replacing it with nominal damages.

The reasoning of the CA was that a contract of carriage already

existed between Navidad and LRTA by virtue of his having purchased
train tickets and the liability was caused by the mere fact of Navidad's
death after being hit by the train being managed by the LRTA and
operated by Roman. The CA also blamed LRTA for not having
presented expert evidence showing that the emergency brakes could
not have stopped the train on time.

ISSUES:

(1) Whether or not LRTA and/or Roman is liable for the death.

(2) Whether or not Escartin and/or Prudent are liable.

(3) Whether or not nominal damages may coexist with

compensatory damages.

RULING:

(1) Yes. The foundation of LRTA's liability is the contract of

carriage and its obligation to indemnify the victim arising from the
breach of that contract by reason of its failure to exercise the high
diligence required of a common carrier.

(2) Fault was not established. If Prudent is to be held liable, it

would be for a tort under Art. 2176 in conjunction with Art. 2180.
Once the fault of the employee Escartin is established, the employer,
Prudent, would be held liable on the presumption that it did not
exercise the diligence of a good father of the family in the selection
and supervision of its employees.

(3) No. It is an established rule that nominal damages cannot

co-exist with compensatory damages. The award of nominal damages
in addition to actual damages is untenable. Nominal damages are
adjudicated in order that a right of the plaintiff, which has been
violated or invaded by the defendant, may be vindicated or
recognized, and not for the purpose of indemnifying the plaintiff for
any loss suffered by him. It is an established rule that nominal
damages cannot co-exist with compensatory damages. The award was
deleted.